Sitting of 17 January 1984

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

  CONTINGENCIES FUND 1982–83
  Ordered, That there be laid before the House Accounts of the Contingencies Fund, 1982–83, showing:

  (1) the Receipts and Payments in connection with the Fund in the year ended the 31st day of March 1983;

  (2) the Distribution of the Capital of the Fund at the commencement and close of the year; with the Report of the Comptroller and Auditor General thereon. — [Mr. Donald Thompson.]

Oral Answers to Questions
  DEFENCE

    Radar Equipment
    Mr. Jannerasked the Secretary of State for Defence whether he will take steps to increase research and development in the United Kingdom on radar equipment for naval vessels.
    The Under-Secretary of State for Defence Procurement (Mr. John Lee): Our overall investment in naval radars in the United Kingdom, including production as well as research and development, has been increasing in real terms and will continue to do so. I am glad to say that naval radars manufactured in the United Kingdom are as good as any in the world.
    However, it is the Government's policy, wherever practicable, to meet our requirements for naval radars—and, indeed, other major equipments—by competition between commercial products rather than from Ministry of Defence-funded special developments. The Ministry of Defence therefore expects to be spending less on such developments in future. However, we will continue to maintain a substantial intramural and extramural research programme in the field of naval radars.
    Mr. Janner: In view of the recent success of the Sea Wolf naval points defence missile system in destroying an Exocet sea-skimming missile of the type that caused such destruction during the Falkland Islands campaign, can the Minister say whether he has any further plans for equipping the Navy with these missiles? Will he recognise the need for such orders in the Marconi plants in my constituency, which have done such marvellous work in this connection in the past and which were caused such anxiety when the naval Estimates were cut a short time ago?
    Mr. Lee: The hon. and learned Gentleman is a consistent advocate of Marconi's cause, and I acknowledge that. We were delighted with the success of Sea
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    Wolf in intercepting at maximum range an Exocet missile, which I announced in the Navy debate at the end of November. That confirms Sea Wolf's position as the best all-round point defence missile system in the world. I congratulate all the contractors involved, including British Aerospace and Marconi, on this achievement. It was announced yesterday that the Ministry of Defence had placed a second production order for Sea Wolf with radars, to be made by Marconi Radar Systems Ltd. It is a valuable order for the company. We shall continue to fit Sea Wolf to type 22 frigates on build and to the future type 23 frigates. In addition, we are examining options for improving the air defence capability of a number of in-service vessels, but no decisions have yet been taken.
    Mr. Michael Marshall: Does my hon. Friend agree that, in reaching decisions on the future of naval radar, it is also important to have an early decision on surface-to-surface guided weapons? On that score, does he hold out any hope for an early decision on SSGWs and an all-British solution to that problem?
    Mr. Lee: I know of my hon. Friend's continued interest in the SSGW, but he must not attempt to draw me and have me prejudge the decision. All I can say is that the decision will be taken as soon as is practicable and possible.
    Mr. Conlan: In view of the ever-increasing cost of this class of work and the further need for commonality, certainly within NATO, is there not a case for collaborative agreements between ourselves and our European NATO allies?
    Mr. Lee: That is a matter that we always have in mind.
    Sir Antony Buck: Does not my hon. Friend's answer amount to the fact that Sea Wolf is a great success, but that it would never have come about if there had been any element of nationalisation in the firms concerned? I have in mind particularly the future of Marconi. Is it not important that the company should not have a sword of Damocles in the form of possible nationalisation hanging over it?
    Mr. Lee: I thank my hon. and learned Friend for his question. We seek maximum competition in MOD procurement.

    Cruise Missiles
    Mr. Dubsasked the Secretary of State for Defence what representations he has received about cruise missiles at Greenham common.
    Mr. Teddy Taylorasked the Secretary of State for Defence how many letters he has received in his official capacity on the issue of cruise over the past year.
    The Secretary of State for Defence (Mr. Michael Heseltine): I received 2,102 letters from Members of Parliament and from members of the public during 1983.
    Mr. Dubs: Is the Secretary of State aware that Members of Parliament are grateful that he has acknowledged our representations that we should be allowed to visit Greenham common, a visit which I believe has been arranged for next Tuesday? Will he confirm that it is his intention that the visit should take place by helicopter? What is the reason for this appalling waste of public money, if that is what is to happen? Is it because

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    the Secretary of State is afraid that some of us might talk to the women of Greenham common before entering the base?
    Mr. Heseltine: From my knowledge of events, Labour Members who wish to talk to the Greenham common women have already taken the opportunity to do so.
    Mr. Taylor: In view of the massive propaganda drive being conducted by the CND and other organisations, will my right hon. Friend take every opportunity to get across the basic fact that we could very quickly get rid of cruise missiles if only the Russians would agree to remove their comparable weapons? Secondly, will my right hon. Friend point out that we are trying to defend ourselves against a regime which sends protesters against nuclear weapons to prison or psychiatric hospitals?
    Mr. Heseltine: My hon. Friend goes to the heart of the matter. We in the NATO Alliance have spent four years trying to avoid the need to deploy cruise missiles, and it is only because the Soviet Union refused to conclude satisfactorily the arms control negotiations with us that we took the inevitable steps, in policy terms, that we did.
    Mr. Strang: Is the Secretary of State aware that I delivered to his office this morning a large chunk of concrete which the Greenham common women believe was thrown over the perimeter fence on to one of their tents in the middle of the night just before Christmas by a British soldier? Has he noticed the recent reports in the press of the harassment of the Greenham common women by British soldiers? Will he take this opportunity to make it clear that he is opposed to any such harassment and that if any Member of Parliament provides him with precise details of any such incident it will be investigated?
    Mr. Heseltine: I think that I can help the hon. Gentleman. I am against members of the armed forces throwing concrete at people.
    Mr. Soames: Does my right hon. Friend agree that the deployment of cruise represents a significant setback for Soviet foreign policy and that the women of Greenham common are in no way representative of public opinion?
    Mr. Heseltine: My hon. Friend is right, and the reason why the ladies of Greenham common have to go to such lengths to get publicity for their cause is that they cannot be elected and voice their views in a democratic forum.
    Mr. Denzil Davies: Will the right hon. Gentleman answer the question asked by my hon. Friend the Member for Battersea (Mr. Dubs)? Is it a fact that the Ministry of Defence is making arrangements to fly Members of Parliament into Greenham common? If that is so, why is it being done in this way? Of what is the Secretary of State afraid?
    Mr. Heseltine: We shall make arrangements to fly those hon. Members who wish to see Greenham common to the base by fixed-wing aircraft. The reason for that is clear. We think that it will enable Members of Parliament to go about their legitimate functions of representing and inquiring into these matters without the need to face organised demonstrations—
    Mr. Willie W. Hamilton: Now we know.
    Mr. Heseltine: —by people who are seeking media coverage for a cause and whom right hon. and hon. Gentlemen would be free to consult if it were in their interest to do so.
    Mr. Denzil Davies rose—
    Mr. Speaker: Order. There are other questions on this matter.

    Information Services
    Mr. Greenwayasked the Secretary of State for Defence if he will make a statement on the information services of his Department.
    The Minister of State for the Armed Forces (Mr. John Stanley): Seventy-one service men and 268 civil servants are engaged in the information services of the Department and of the individual armed services. They are concerned primarily with informing the public about the Government's defence policy and of the activities of the armed forces.
    Mr. Greenway: Will my hon. Friend ensure that his Department makes available suitable material to schools and educational and other institutions setting out the NATO and Western defence case, to ensure that there is a proper balance in peace studies and allied subjects?
    Mr. Stanley: I assure my hon. Friend that publications from my Department to inform the public about various aspects of defence policy are freely available to teachers and those in the academic world who want to have the Government's view.
    Mr. McNamara: Will the Minister take care to advise regular officers taking part in presentation schemes and teams that when speaking to the public they should not indulge in what might appear to be political polemics either about Governments or parties in this country or about the rulers of states abroad?
    Mr. Stanley: As the hon. Gentleman is aware, the armed services have a strict tradition of party political neutrality. The presentations whereby the armed services seek to explain their respective roles that are carried on under this Government have been carried on under successive Governments.

    Lebanon (British Troops)
    Mr. Proctorasked the Secretary of State for Defence if he will estimate the costs of British troops in the Lebanon during 1984; and if he will make a statement.
    Mr. Stanley: If the British contingent of the multinational force were to remain in Beirut throughout 1984, the additional cost of having our men there rather than at their normal location would be in the region of £800,000. The British contingent continues to patrol in Beirut and to provide the security force for the ceasefire committee, both of which roles are highly valued.
    Mr. Proctor: Will my hon. Friend take this opportunity to pay a tribute to the British officers and men who carry out their work with such distinction, especially in protecting the ceasefire committee?
    Mr. Stanley: I am grateful to my hon. Friend for raising that question. I readily pay a warm tribute to the outstanding contribution that has been made by our small contingent to the multinational force, which has exercised influence to the good out of all proportion to its size.
    Mr. Russell Johnston: Is the Minister able to develop the Prime Minister's implication of her wish for an orderly transfer from a British force to a United Nations'

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    peacekeeping force, a view which the Liberal/Social Democratic alliance supports'? Has he any thought of giving such a force a more effective mandate than UNIFIL had in the south of Lebanon?
    Mr. Stanley: For some time we have felt that the development of the United Nations existing role in the Lebanon would be a practical way of providing an alternative to the multinational force, and we are continuing to discuss that possibility with all interested parties.
    Mr. Stokes: Is my hon. Friend aware that everyone realises the magnificent part which our small number of troops have played in Beirut? Is their sole purpose there merely to guard a building in which from time to time peace discussions are held? What is the long-term future of these troops? Are they not every day being exposed to unnecessary dangers?
    Mr. Stanley: The function of the troops in Beirut is to provide physical evidence of the presence of the multinational force by patrolling in Beirut. It is also to provide the all-important security force for the ceasefire committee. It is unlikely that the ceasefire committee would be meeting if its various members were not satisfied with the adequacy of the security arrangements, as they certainly currently are with the British presence.
    Mr. Tom Clarke: In view of President Reagan's statement yesterday, does the Minister accept that we in Britain have a responsibility to ease world tension, that the Lebanon is a part of the world where that can occur if we involve the United Nations and that a large number of people who are extremely well informed doubt the wisdom of the presence of British troops?
    Mr. Stanley: There is little doubt that if the four components the MNF were withdrawn the violence and bloodshed in Beirut would be far greater than it is at present.
    Mr. Budgen: If it is necessary to withdraw British troops from the Lebanon, why is it thought that United Nations troops would do a better or different job?
    Mr. Stanley: The United Nations, by its nature, tends to have a more permanent existence—for example, as in Cyprus—than the multinational force, which has always been envisaged as a temporary response to the particular serious situation that has arisen in Beirut.
    Mr. Denzil Davies: Is the Minister aware that we all agree that the British troops have done a marvellous job in the impossible, dangerous situation in which the Government have irresponsibly put them? Is it not a fact that the British troops went in on the coat tails of President Reagan and the Government are now totally out of control of the situation? The troops will come out if President Reagan wants them to come out, and they will stay there if he does not. Why can we not show some independence in British foreign policy?
    Mr. Stanley: The right hon. Gentleman appears to have forgotten that when the British component first went into Beirut it did so with the support of the Opposition. He can be certain that the Government continue to take an independent view of the problem. Our view is that it is in the interests of stability in Beirut that the four component members of the MNF act together and that we should stay in Beirut.

    Royal Ordnance Factory, Alsager
    Mrs. Dunwoodyasked the Secretary of State for Defence whether he has any plans for the sale of Alsager royal ordnance factory.
    The Minister of State for Defence Procurement (Mr. Geoffrey Pattie): We have at present no plans for the sale of ROF Radway Green, Alsager. As I said in the House yesterday, we shall be considering carefully the best means of privatising the royal ordnance factories either as a group or in parts.
    Mrs. Dunwoody: As that particular ordnance factory has contributed more than £194 million in sales for the taxpayer in the past 10 years. will the Minister tell the House what safeguards are to be built in to ensure that if the factory is sold he will know who holds the shares, as it is painfully obvious that no safeguards are envisaged by the Government and that any foreign national whatever could hold controlling shares through a second or third company?
    Mr. Pattie: The safeguards will be the same as those adopted for other forms of privatisation carried out by the Government and will no doubt be enshrined in the articles of association of the new company.

    Experimental Aircraft Project
    Mr. Robert Atkinsasked the Secretary of State for Defence if he will make a statement about the current status of the experimental aircraft project.
    Mr. Pattie: I refer my hon. Friend to the answer that I gave him on 1 November 1983.
    Mr. Atkins: Is my hon. Friend aware of the continued and increasing concern of my constituents working in the British aerospace industry and of others throughout the country about this project? In view of the imminent decline in Tornado production, will he say something about the agreements made by the air staffs on the future European fighter aircraft and about the industrial cooperation that must follow if the project is to go ahead? Will he also give us some idea of the time scale?
    Mr. Pattie: I am sure that the House will welcome the outline joint staff target signed on 16 December by the chiefs of air staff of the five participating countries. The importance of this is that it represents further progress than has ever been achieved before, in the sense that all the air forces have now agreed a common requirement. It is now time for all the industries concerned to play their part. I do not suggest that the process will be easy, but we believe that there are great advantages in a joint programme and we are working hard to that end.
    Mr. Bill Walker: Does my hon. Friend agree that in any aircraft purchasing the important thing is to ensure that the aircraft purchased is the most suitable to do the job for the Royal Air Force? Does he further agree that in considering this project it is important to ensure that the requirements of the RAF are not subjected to or negated by other requirements?
    Mr. Pattie: I agree with my hon. Friend, but I remind him that one of the five signatories was the chief of air staff of the Royal Air Force, who recognised that the future requirements of the RAF were catered for in the outline staff target.

    Cruise Missiles
    Dr. Marekasked the Secretary of State for Defence if he has had any representations from other Governments about the targeting of cruise missiles to be deployed in the United Kingdom.
    Mr. Heseltine: Her Majesty's Government have discussed NATO's twin track decision on INF deployment and arms control with a wide range of foreign Governments. I do not, however, propose to disclose the contents of the discussions.
    Dr. Marek: Will the Secretary of State give an assurance that none of the cruise missiles deployed in this country will be targeted on inhabited areas such as the Ruhr which are within the perimeters of our NATO allies? Will he reconsider his policy of not commenting on the targeting of missiles? If, after reconsidering the policy, he still declines to comment, will he urge the controlling power to consider the matter and to make a statement on it?
    Mr. Heseltine: The hon. Gentleman has already raised this with my right hon. Friend the Prime Minister and I cannot and would not wish to add to her reply. He will be fully aware, however, that the purpose of NATO is that of a defensive alliance. Targeting policy is therefore bound to be designed with that object in mind.
    Mr. Cyril D. Townsend: Is my right hon. Friend satisfied with Ministry of Defence arrangements for informing the Soviet Union of the nuclear-free zones in the United Kingdom so that that country's targeting can be kept continually up to date?
    Mr. Heseltine: I am extremely grateful to my hon. Friend. I must be frank and admit that he has spotted a lacuna in our organisation which I shall immediately seek to rectify.
    Mr. Boyes: I would not be as sure as the hon. Member for Bexleyheath (Mr. Townsend).
    Is the Secretary of State aware—and if so has he discussed this with his NATO allies — that an announcement by the joint cruise missile project office stated that on 19 November this year a cruise missile identical to those that have been installed in Britain failed on a test trial after a very short journey and that only 84 out of 130 missiles had been successful? I am certain that our NATO allies are not so confident about the safety of the cruise missiles that we have in Britain.
    Mr. Heseltine: The hon. Gentleman will be aware that there is a nuclear safety committee which advises the Government and which has satisfied itself about the safety of these weapon systems. He will also be aware that it is the same procedure as that which existed under the previous Labour Government.
    Mr. Rathbone: Can my right hon. Friend give us some idea not so much about the targeting of cruise as about the briefing that he may have given to his right hon. and learned Friend the Foreign Secretary prior to the talks in Stockholm, with regard to cruise particularly?
    Mr. Heseltine: I am very grateful to my hon. Friend, who I know has taken a great deal of interest in these matters. My right hon. and learned Friend the Foreign Secretary and myself, as members of the Government, have a very clear joint objective for the Stockholm talks,
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    and that is to persuade the Soviet Union to take them seriously and seek meaningful arrangements, which are readily available from the Western Alliance.
    Mr. Denzil Davies: The Secretary of State may be reluctant to talk about targeting, but is it not clear from literature published in the United States and in Europe that the cruise missile is targeted on military targets which would be considered significant if a war were to break out in Europe? Is it not a fact that, rather than be obsessed with cruise missiles, he should try to move—[Interruption.] The right hon. Gentleman is as obsessed with cruise missiles as other people are. That is one of our condemnations of his defence policy. Should he not move away from his obsession and realise that cruise missiles, like battlefield nuclear weapons, are a product of NATO's out-of-date concept of fighting a limited nuclear war? If we could move NATO away from the first use of nuclear weapons, is it not the case that cruise weapons, like battlefield nuclear weapons, would not be necessary?
    Mr. Heseltine: I think that on reflection the right hon. Gentleman might feel that the obsession is his. The trouble With his obsession is that he talks only about the NATO cruise deployment. He seems to be completely oblivious to the fact that over the last decade the Soviet Union has developed a range of cruise missiles capable of being launched from ground, sea or air. He never seems to have any complaints about that.
    Mr. Ron Daviesasked the Secretary of State for Defence if he is satisfied with the present arrangements for the dispersal of cruise missiles from Greenham common for training purposes.
    Mr. Heseltine: As I have already made clear, the arrangements will be adequate to enable the personnel to train fully for their operational role. I am not prepared to discuss details.
    Mr. Davies: Will the Secretary of State confirm that to enable cruise missiles to be maintained at a state of operational readiness they will have to be dispersed throughout the countryside? Will he say whether, in the event of peaceful demonstrations which will undoubtedly accompany the dispersal of those missiles, the security of those missiles and the policing of those demonstrations will be the responsibility of unarmed British policemen or of armed American service men?
    Mr. Heseltine: On the first question that the hon. Gentleman puts to me about the need to deploy off base, the weapons systems could be fired from within the base, but, as the last White Paper made clear, the system is designed to be widely deployed off base.
    Mr. Boyes: That is why the right hon. Gentleman has no control over them.
    Mr. Heseltine: If training exercises take place, the position is that they will not be training exercises using live weapons systems. I imagine that the proper answer to the hon. Gentleman in that context is that there will not be a need for the guards accompanying those deployments to be armed with live weapons.

    Greenham Common
    Mr. Andrew MacKayasked the Secretary of State for Defence if he will make a statement on security at the Greenham common base.
    Mr. Stanley: Security at the base is under constant review. A number of further security measures have been implemented in recent months and others are under consideration.
    Mr. MacKay: Does my hon. Friend agree that we should keep in perspective the security threat posed by the so-called peace women? We should not over-react by spending too high a percentage of the defence budget on guarding the Greenham common base and playing straight into the hands of CND and its supporters, who would like the money spent on defence to be spent elsewhere.
    Mr. Stanley: I agree with my hon. Friend. Clearly, a balance must be struck between the security needs of the base and, as he rightly points out, not creating an unnecessary and unjustified diversion of both finance and manpower into protecting the outer perimeter fence.
    Mr. Flannery: Is it not a fact that the women who have got into Greenham common have proved that there is no real security there, and is the hon. Gentleman aware that his hon. Friend who represents the area, the hon. Member for Newbury (Mr. Michael McNair-Wilson), has actually said that? Is it not also a fact that to get in — one wonders whether this is how the missiles will be got out—Members of Parliament and delegations will have to go over the women's heads in helicopters? Is that the sort of security the exists at that base, not to mention the obscenities perpetrated by American troops against the women outside the base—[Interruption.]—which some of us have witnessed, including concrete blocks being thrown at the women by American troops. [HON. MEMBERS: "Rubbish."] We have seen that happen.
    Mr. Stanley: I assure the hon. Gentleman and the House that the Greenham women have not proved that there is no security at the base. There has been no penetration of the highest security areas.
    Dr. Mawhinney: I acknowledge the need for a balance, but does my hon. Friend accept that the repeated illegal excursions of these women on to the base is a matter of growing national concern? Does he further accept that it is equally a matter of concern that appropriately severe measures do not appear to be taken against those who break the law in this fashion?
    Mr. Stanley: I agree with my hon. Friend that the penetration even of the outer perimeter fence must be a matter of concern. That is why, as I said in my main answer, we have taken a number of measures to improve security, and further measures are under consideration. The question of sanctions is a matter for the Home Secretary.
    Mr. Denzil Davies: In regard to breaking the law and sanctions in this case, is it not a fact that two different laws apply to the security forces at Greenham common? If a British soldier breaks the law, he is subject to the common law of Great Britain. If an American soldier breaks the law, he is subject only to American military law. If the Government desire acceptance of their cruise missiles programme, why do they not make sure that American soldiers are also subject to British law?
    Mr. Stanley: The view which the right hon. Gentleman has expressed is completely incorrect. The Visiting Forces Act is on the statute book on the same basis as it has been for successive Governments. I urge him to
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    read in detail the excellent speech by the Under-Secretary of State for the Home Department when answering one of the Christmas Adjournment debates, in which he set out the legal position extremely fully and succinctly.

    Warsaw Pact (Meetings)
    Mr. Adleyasked the Secretary of State for Defence when he next expects to meet any of his Warsaw pact counterparts; and what matters he expects to discuss.
    Mr. Pattie: Neither I nor any of my ministerial colleagues in the Ministry of Defence have any current plans to do so.
    Mr. Adley: In the eventuality that meetings at Stockholm may take place between representatives of NATO Governments and Warsaw pact Governments, will my hon. Friend and his colleagues make it abundantly clear to those members of the Warsaw pact that appeasement and pacifism are alien doctrines, certainly to the 13 million people who voted Conservative at the last general election and, presumably, to members of the Social Democratic party, and that we in this country will continue to defend the right to choose our own Government and defence policy unless and until there is at least some evidence that the Soviet Union is prepared to withdraw its missiles from the eastern European countries?
    Mr. Pattie: I am sure that the ruling authorities in the Soviet Union are aware of that position. The confidence-building measures that are being discussed in Stockholm today will relate to various matters, including the notification of manoeuvres and other matters on which we have taken the initiative in recent years.
    Mr. Douglas: How many observers do we have at Warsaw pact manoeuvres and how many observers does the pact have at ours?
    Mr. Pattie: Without prior notice, I could not answer that question. However, we have gone beyond what might be called the statutory requirement. We have taken the initiative to inform the Warsaw pact of manoeuvres, when it was not strictly necessary for us to do so under the agreement, and we have offered it facilities for observers. I shall write to the hon. Gentleman on the subject.
    Mr. Wilkinson: Could my hon. Friend suggest to the Secretary of State that, at the next NATO ministerial meeting, he should discuss seriously with his NATO counterparts a response to the suggestions of First Secretary Andropov about reductions in chemical weapons by the Warsaw pact?
    Mr. Pattie: I am sure that my right hon. Friend has heard my hon. Friend's important suggestion, but a realistic and worthwhile response from the Soviet Union to the initiative taken by the Government late last year is still awaited.
    Mr. Fisher: When the Minister and the Secretary of State get around to meeting their Warsaw pact counterparts, will they discuss with them the 18 practical steps suggested by the former United States Secretary of Defence, Robert McNamara, for reducing the risk of nuclear war?
    Mr. Pattie: The steps to which the hon. Gentleman refers will, I hope, be among the subjects considered at the discussions in Stockholm, which will begin today and will last for some time.
    Mr. Johnston: In what respect, if any, will the position of Her Majesty's Government in Stockholm differ from that of the American Administration?
    Mr. Pattie: The position of Her Majesty's Government on the confidence-building measures is the same as that of other members of the NATO Alliance, in that we wish to see an improvement in those measures, if the Soviet Union will reciprocate.

    SS20 Missiles
    Mr. Chapmanasked the Secretary of State for Defence what is his latest estimate of the number of SS20 missiles targeted on western Europe.
    Mr. Stanley: There are currently 243 SS20 missiles targeted on western Europe, which means 729 SS20 warheads.
    Mr. Chapman: Is it not the case that if, at any time over the past four years, Russia had agreed to dismantle its SS20s, cruise need not have been deployed? Far from doing so, the Russians tripled the number targeted on western Europe. Is it not still Government policy, nevertheless, that we would withdraw cruise if the Russians agreed to dismantle all of their SS20s?
    Mr. Stanley: I can confirm that NATO's clear policy is to withdraw both its cruise and Pershing II missiles if the Soviet Union removes its SS20s, and its SS4s and SS5s.
    Mr. Kirkwood: While I recognise that there has been an increase in the number of SS20s, may I ask the Minister to turn his attention to newspaper reports last week to the effect that the United States is at present turning out eight nuclear warheads each day? What will that do for the confidence-building measures in Stockholm?
    Mr. Stanley: The hon. Gentleman must consider the historical perspective. It was the Soviet Union which took the initiative in producing a new type of longer-range intermediate ballistic missile. It began to deploy them in 1977 and the numbers have increased remorselessly ever since. When NATO took its dual track decision in 1979, there were 81 missiles facing west. By November 1981 there were 171, and there are now 243. The escalation has been wholly on the Soviet side.
    Mr. Cormack: How many so-called peace camps are there outside the SS20 bases?
    Mr. Stanley: As my hon. Friend knows, the answer is zero. That is symptomatic of the profound differences between our two societies.

    MINIS
    Mr. Eggarasked the Secretary of State for Defence if he will make a statement on the introduction of the Management Information System for Ministers into his Department.
    Mr. Heseltine: The Management Information System for Ministers—MINIS—is now firmly established in the
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    Ministry for Defence and is the focus for work aimed at improving the management of resources and increasing efficiency. In the initial MINIS round, some quarter of a million service men and civilians and the resources they manage have been encompassed by the system. The information has provided the basis for Ministers and senior officials to review organisational structures in the Department and the responsibilities and objectives of managers in different areas. MINIS has already led to management improvements, particularly through clarification of responsibilities, and has identified a range of areas for work directed towards improving efficiency and reducing the costs of defence overheads. This will be a continuing process.
    Mr. Eggar: Can my right hon. Friend yet say what savings he expects as a direct result of the introduction of MINIS?
    Mr. Heseltine: I am grateful for my hon. Friend's continuing interest in this matter. However, I cannot answer that question because substantial economies have been pursued and achieved in the Ministry of Defence over a number of years and the recent initiatives are a continuation of that process.
    Mr. Skinner: If the Secretary of State is so anxious to cut the cost of information services, and is so worried about the public relations image of the Ministry of Defence, why is it that when a young girl in his Department decides to take part in a bit of information servicing and sends some news to the newspapers, at no cost to the Ministry of Defence, he takes her to court?
    Mr. Heseltine: I did not.

    Cruise Missiles
    Mr. Cartwrightasked the Secretary of State for Defence when he anticipates further deployment of cruise missiles at Greenham common.
    Mr. Heseltine: NATO deployments of cruise and Pershing II missiles are due to be completed over a five-year period. The programme for the deployment of 96 ground-launched cruise missiles at Greenham common will be completed well within that period, but I am not prepared to discuss specific details of further deliveries. As we have made clear, NATO's plans can be halted, modified or revised if results in negotiations in Geneva warrant it.
    Mr. Cartwright: Now that NATO has demonstrated its resolve by making the initial deployment of cruise and Pershings, will Her Majesty's Government press strongly for a limited, deliberate suspension of further deployments to encourage the Soviets to return to meaningful negotiations in Geneva?
    Mr. Heseltine: No, we would not be prepared to do that. What we would do, which I think achieves the purpose that the hon. Gentleman has in mind, would be to make it clear to the Soviet Union that any weapon systems that have been already deployed can be removed if the Soviet Union will reach meaningful arms control arrangements with us.
    Mr. Nicholls: If my right hon. Friend accepts that what we have heard from the Labour Benches today shows, as always, how unfitted they are to be entrusted with the

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    defence of the realm, what does he make of the fact that, while the alliance still has pretensions of grandeur about Government, during the past 48 hours we have seen that the position of the SDP on Polaris and the deployment of cruise is at variance with that of its Liberal partners? Does he think that that will appeal to the electorate and show that the alliance is fitted for office?
    Mr. Heseltine: I suppose that if one has two policies, they could, arguably, be better than one, if the one is no good.
    Mr. Hal Millerasked the Secretary of State for Defence if the initial programme of installation of cruise missiles in the United Kingdom has now been completed.
    Mr. Heseltine: The first ground-launched cruise missiles at RAF Greenham common became operational at the end of 1983, in accordance with NATO's December 1979 decision.
    Mr. Miller: While congratulating my right hon. Friend on the successful completion of that much-needed initial programme, may I ask what is happening on the ground now in the Soviet Union since the breakdown of the talks? Has there been any further deployment of SS20s in eastern Europe?
    Mr. Heseltine: All the indications and information available to us show that the Soviet Union is continuing with the arms build-up in all categories of weapons systems, including the SS20s, which has characterised its recent defence policy.
    Mr. Willie W. Hamilton: As cruise missiles are increasingly deployed, will there not be an increased risk of confrontation between American military personnel and British civilians? In such circumstances, will not those American personnel come under the purview and discipline of the American military? All the evidence of recent years shows that the penalties imposed in such circumstances by the American military authorities are derisory. Will the Secretary of State review the operation of the Visiting Forces Act in the light of the new ball game?
    Mr. Heseltine: The hon. Gentleman raises a serious question. We have considered the Visiting Forces Act to see whether the satisfaction expressed in it by the previous Labour Government justifies our continued confidence. In the main, it certainly does. I would accept the significance of the hon. Gentleman's point of view to this extent—the Government have a clear mandate for the deployment of the cruise weapon system. It is necessary for us to take the appropriate steps to carry out that mandate. There is no way in which we shall seek, or encourage, the frustration of that mandate by people who were unable to prevent the Government's election.
    Mr. Denzil Davies: Will the Secretary of State clarify the confusion created by his Minister of State and confirm that if an American soldier engaged in security duties at Greenham common commits a prima facie criminal act he is subject in the first place not to English law but American military law? Will he confirm that that is the position?
    Mr. Heseltine: My hon. Friend answered the question perfectly accurately. Visiting forces are governed in this country by the Visiting Forces Act 1952. In one way or the other, anyone found guilty of a crime is covered by the law of the land, with the option of the process of law being
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    pursued either in the country itself or in the home country of the forces themselves. That position was set out clearly in the recent debate to which my hon. Friend drew attention, and that is the position which was found be perfectly satisfactory by the previous Labour Government.
    Mr. Willie W. Hamilton: No.
    Later—
    Mr. Boyes: On a point of order, Mr. Speaker. I am not convinced that the Secretary of State for Defence gave the House a correct interpretation of the Visiting Forces Act 1952. Might I ask the Home Secretary to read carefully what the Secretary of State for Defence said, and if what he said is not correct to publish a correction in the Official Report?
    Mr. Speaker: What the hon. Gentleman has said will have been heard.

  PRIME MINISTER

    Engagements
    Mr. Adleyasked the Prime Minister if she will list her official engagements for 17 January.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House I shall be having further meetings later today.
    Mr. Adley: While I welcome the progress of the negotiations about the future of Hong Kong and the recent statements from the Chinese Government, may I ask my right hon. Friend whether she agrees that once an agreement has been reached between Her Majesty's Government and the Chinese Government the people of Hong Kong would have to accept responsibility if they were to seek in any way to reject the agreement reached between the two Governments?
    The Prime Minister: As my hon. Friend knows, our aim is to agree with China, through negotiations, and to reach an arrangement which will maintain the stability and prosperity of Hong Kong in a way acceptable to the people of Hong Kong, to this Parliament and to the people of China. Yesterday I saw the Governor of Hong Kong together with all the unofficial members of EXCO, and repeated our commitment to Hong Kong.
    Dr. Owen: As the Prime Minister justifies her decision to go ahead with the rate-capping Bill, which has been criticised extensively, on the basis that she pledged to do so to the electorate, how does she square that with a similar pledge that she gave to the electorate to abolish rates in October 1974, which she gave again to the electorate in 1979, and with her statement in the House in July 1983 that she would maintain rates?
    The Prime Minister: I seem to remember that the Labour party, of which the right hon. Gentleman was a member, won the 1974 election, and that the Liberal party eventually kept the Labour Government in power for a longer period than it would otherwise have held office
    Sir Paul Bryan: Now that 1983 is behind us, would this be a good time for the Prime Minister to remind the country that during the election the shadow Chancellor of the Exchequer forecast a double figure inflation rate by the end of the year should the Tories win?
    The Prime Minister: I am grateful to my hon. Friend. The success of the Government in getting down inflation and in holding it down is quite outstanding. When we returned to power, a 5 per cent. rate of inflation was thought almost impossible. We now regard 5 per cent. as high and we must get it down further.
    Mr. Winnick: Will the right hon. Lady inform the House of the going rate that a company must donate to the Tory party so that its chairman stands a reasonably good chance of receiving a knighthood? Is it a coincidence that, since 1979, 60 per cent. of the industrialists who have received knighthoods have been associated with companies which have donated to her party?
    The Prime Minister: As the hon. Gentleman knows, any recommendations that I make go to the Political Honours Scrutiny Committee, whose powers I have strengthened.
    Mr. Greenwayasked the Prime Minister if she will list her official engagements for 17 January.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Greenway: Is my right hon. Friend aware that no Labour or Lib/Lab Government ever guaranteed pensioners travel passes in London, and that the Greater London council is currently raising pensioners' rates by millions of pounds to fund its spurious campaign to save their travel passes after its abolition? Will my right hon. Friend underwrite the promises of Conservative London boroughs to continue pensioners' travel passes?
    The Prime Minister: My hon. Friend is right. It has been the policy of successive Governments that local authorities are in the best position to judge the needs in this respect—[Interruption.]—
    Mr. Speaker: Order. This sort of interruption takes time out of Question Time.
    The Prime Minister: My hon. Friend is correct in saying that the GLC has been running a scurrilous campaign and frightening many elderly people by causing them to think that their passes will not continue. The London Boroughs Association has recommended that the London boroughs take over the responsibility for this. The Government stand ready to discuss with the London boroughs any financial effect upon them—including any equalisation effect—of this or any other service that is similarly transferred.
    Mr. Barron: Will the Prime Minister make a statement to the House about her involvement in the contract that was negotiated between Oman and Cementation International Ltd. and the involvement of members of her family?
    Hon. Members: Cheap.
    The Prime Minister: I am answerable in the House for my actions as Prime Minister and I do so answer. As part of my public duty, I make strenuous efforts to secure contracts for this country. I do not decide upon those contracts. The decisions are made by the Governments who award those contracts. I do not distinguish between companies in Britain. My job is to ensure that we get the contracts and the business here. As a result of the middle east tour, hundreds of millions of pounds worth of contracts came to this country.
    Sir Michael Shaw: Is my right hon. Friend aware that, had she taken the opposite course and not sought to assist the British company to gain an important contract with the middle east, she would have heard criticism from the Opposition and from the whole of the country, and such criticism would have been justified and genuine?
    The Prime Minister: I speak up for Britain and I am pleased that I do so successfully. I am pleased that, as a result, much business comes here.
    Mr. Hume: Will the Prime Minister explain to the House why she chose to visit the Drummadd barracks of the Ulster Defence Regiment when she visited Northern Ireland before Christmas? Is she aware of the deep feelings of outrage within the Catholic community that arose from that visit? Does she agree that she could have visited any barracks anywhere in Northern Ireland. and that in choosing to visit the Drummadd barracks in the same week in which eight members of the regiment were charged with sectarian murders of Catholics in Northern Ireland she thereby gave an unfortunate Christmas present to the forces of violence in Northern Ireland?
    The Prime Minister: I visited the barracks, which are the headquarters of the resident unit of the Grenadier Guards. I am entitled to do that. There were some members of the Ulster Defence Regiment there. The UDR does a superlative job. I visited it because it was the headquarters of the Grenadier Guards. I hope that no one is criticising me for that. May I make it quite clear that I am the first to condemn violence or terrorism anywhere, and especially in Northern Ireland.
    Mr. Simon Hughesasked the Prime Minister if she will list her official engagements for Tuesday 17 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Hughes: Will the Prime Minister announce a new year resolution to the House today, giving her commitment not only to support the campaign for freedom of information in 1984 but to allow local authorities the freedom which she has always proclaimed is the right of everybody in the land?
    The Prime Minister: No, Sir. With regard to local authorities the House has, I believe, the overriding right to have taxation within its decision. Everyone has a vote for a Member of the House; not everyone has a vote for local authorities. Many who have to contribute to the rates of local authorities do not have a vote. It is fully in keeping with democracy and with the Chancellor of the Exchequer's duty of controlling public expenditure that we should have the right here to cap rates.
    Mr. Kinnock: On the subject of information and, indeed, taxation, yesterday the Treasury published figures showing that £2·2 billion more will be taken out of wage packets this year than in 1979, despite the fact that there are 2 million fewer wage packets. How much of the higher stoppages by the Government, who are committed to reducing taxation, was due to the need to pay for much higher unemployment?
    The Prime Minister: The total cost of unemployment is of the order of £5 billion. I have given the figure many times to the right hon. Gentleman. Unemployment under the national insurance scheme costs something like £1·6

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    billion and the rest is for social security. That is the amount that is paid out. Although there is an increasing amount of tax coming in, may I point out that that is more than accounted for by the increase in average earnings, because on the whole the standard of living of those who have been in work has gone up, after they have paid tax.
    Mr. Kinnock: Is the Prime Minister aware that her figure of £5 billion is utterly implausible, even on the basis of straightforward multiplication? It would not be enough even to pay the benefits that have to go to the extra unemployed who have been created by the Government. Can she explain in real terms why, under her Government, £7 billion more is being paid in expenditure taxes and over £3 billion more in national insurance? How can she conclude, as she did on Sunday, that somehow this is not taxation.
    The Prime Minister: The one main reason why a great deal more is being paid both in income tax and expenditure taxes is that wages, earnings and the standard of living have gone up under this Government.
    Sir Geoffrey Finsberg: Is my right hon. Friend aware that the total burden of national insurance surcharge and corporation tax on businesses is less than the amount paid in rates by commerce? Is she aware that this is why business and industry want the legislation that we will be considering today? Can she assure them that the legislation will go through both Houses with the utmost dispatch?
    The Prime Minister: I share my hon. Friend's view. The heaviest tax paid by all those in business and commerce is what they pay in rates, which is in the order of £6 billion. They pay that tax regardless of whether or not they make any profits. Of course, that comes off the tax that they pay to Her Majesty's Government. They and the overwhelming majority of the people want legislation to restrain the increase in rates.
    Mr. Cartwrightasked the Prime Minister if she will list her official engagements for Tuesday 17 January.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Cartwright: Does the Prime Minister recall advising the Conservative party conference in 1965 against removing the power of local councils to levy rates on the grounds that that would undermine the entire basis of local government? Is that not just what the Rates Bill will do?
    The Prime Minister: The Bill leaves enormous powers to levy rates. If some authorities had not overspent so much, last year's rate burden would have almost stood still. No, authorities still have considerable powers to levy rates but they do not have unlimited power to do so.
    Mr. Yeo: Does my right hon. Friend agree that as a substantial part of the rates are paid by businesses, which have no vote—
    Mr. Boyes: Rubbish.
    Mr. Yeo: —the argument that the rate-capping Bill is a threat to local democracy amounts to no more than a pool of crocodile tears which have been shed by people whose real attitude to democracy can be seen by their resistance to the Trade Union Bill?
    The Prime Minister: Yes. Some 60 per cent. of rates are paid by business and commerce. The overwhelming majority of rates are paid by people who do not necessarily have a vote in the election of the authority that imposes those rates.
    Mr. Ryman: Is the Prime Minister aware of the failure of an important building society in London a few days ago? Is she further aware that thousands of investors have been jeopardised in that they have been unable to withdraw their savings? Will she introduce legislation to reform building societies to afford real and effective protection for investors?
    The Prime Minister: As the hon. Gentleman knows, the building society in question has been taken over by the Woolwich. I believe that all investors will be paid. The takeover was arranged extremely well and has protected the interests of investors in what was the New Cross building society.

Theft from Shops
3.31 pm
Mr. Greville Janner: I beg to move,
That leave be given to bring in a Bill to require that all prosecutions for shop theft shall be brought by the police; and for related purposes.
The Bill has two purposes. The first is to end the tragic, inefficient and awful system under which in Greater London and a few other areas the police will not take prosecutions for what they choose to call petty theft. That leaves private people, especially those who run shops, to decide whether or not to prosecute, and to bring prosecutions when they have neither the resources nor the ability to make such decisions in the interests of justice or in a way that is fair to the people involved.
The Bill's second purpose is to ensure that once the power provided by the Bill is used by the police, and only by the police, they shall take steps which are already in operation in several forces, including Leicestershire and Essex. They should seek to ensure that elderly and, especially, ill people and sometimes young people—and those who have not previously committed offences—are not prosecuted when a caution or hospital treatment is society's best response to the commission of an offence which, notably when committed by elderly women, is often a minor form of suicide. Indeed, such cases often lead to suicide.
People in Leicestershire suffered the tragic death of Lady Isabel Barnett. She was a friend of many right hon. and hon. Members. Her case should never have been brought to trial. Instead, she should have received hospital treatment. I am pleased that, since then, the Leicestershire police force has changed its system and now uses its resources properly in an attempt to ensure that people such as her are not prosecuted. I have a list of some 33 people who have recently committed suicide as a result of shoplifting prosecutions. Their names were given to me by Mr. Ken Norman, the organiser of the Portia Trust. I pay tribute to him, to Regina Dollar of Crisis Counselling for Alleged Shoplifters, and to the Samaritans for their work.
We are attempting to take the burden of prosecution away from the shops, which are not in a position to bear it. I am pleased to say that, with reservations, those who represent the retailers, the shops and their associations, support at least part of the Bill. They do not want the burden of prosecution.
I have received a host of replies to my questions from retailers, who say that they wish that the police would take it over. The British Retailers' Association, which represents multiple retailers and department stores, says that the police should take the burden of prosecution for theft and shoplifting. Woolworth's, Sainsbury's, and the Association for the Prevention of Theft in Shops all declare that prosecutions for theft should be instituted by the police, not by shopkeepers.
All those groups and companies have expressed one reservation. They say, with amazing unanimity, that the police have the duty and resources to decide whether to prosecute. If the police decide not to do so, and if the private citizen says that the police have got it wrong, they claim that they should retain the right themselves to prosecute. They would like to hold their stock and to retail it. It is not possible for the burden to be imposed on the police, as it should be, and then for shopkeepers to retain
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for themselves a residual right of prosecution. The Bill's sponsors, who are in an all-party group, believe that it is the duty of the police to decide whether to prosecute and that they should exercise it properly.
I am pleased to inform the House that the Commissioner of Police of the Metropolis has written to me:
"in principle we are prepared to accept responsibility for all prosecutions of shoplifters".
He adds, quite understandably:
"there are severe resource and other financial implications arising from this policy."
Indeed there are. It is right that the police should be equipped to carry out such duties properly, but surely it is better for the public that the police should have the resources to do the job properly than to have people wrongly brought before the courts. Legal proceedings involve massive expense.
The present system is unjust to traders, and it does not bring people to trial any more frequently than the other system—when they should be brought to trial. It causes tragedy for some of the guilty—and it is not in the interests of justice, especially for those accused who are elderly and infirm. It creates pain, hardship and suffering to innocent people caught up in the extraordinarily difficult world of the self-service store. In a moment of forgetfulness, their lives may be ruined. People are stopped by store detectives, whose spokesmen have said over and again that it is for the courts to decide whether or not an accused is guilty. It is not a matter for the courts to decide at that stage. The question is: should the case go to court?
The accused may have to wait for more than a year before the case comes to court, particularly if he elects for trial by jury. Although awaiting the perils of trial is an occupational hazard for professional criminals, for whom none of us has any brief, awaiting trial is a misery for honest people. They may be found innocent, but only after having faced and endured the trials of coming to trial. Even an acquittal has its miseries. Thousands of them suffer mental hardship and breakdowns, long before their cases are heard. Happily, only a minority of people—a tragic and wretched one none the less—decide that they wish to live no longer as a result of their experience.
This is a modest Bill. It would set aright a peculiarly unhappy and characteristic misery of the modern world of shopping. It has a certain degree of support from shops and traders who, rightly or wrongly, bear the blame, as Woolworth did recently. It has the support of the police, provided that they have the resources, who wish to do well by the community and who recognise that that is part of their job.
Question put and agreed to.
Bill ordered to be brought in by Mr. Greville Janner, Mr. David Alton, Mr. Tony Blair, Miss Betty Boothroyd, Sir Bernard Braine, Mr. Tom Cox, Mr. David Knox, Mr. Michael Latham, Mr. Roy Mason, Mr. David Mudd and Mr. Alec Woodall.

Theft from Shops
  THEFT FROM SHOPS
  Mr. Greville Janner accordingly presented a Bill to require that all prosecutions for shop theft shall be brought by the police; and for related purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 23 March and to be printed. [Bill 83.]
Orders of the Day

  Rates Bill
  Order for Second Reading read.
  Mr. Speaker: Before we proceed with the Bill, I should like to say that I have received more than 76 applications from hon. Members to speak in the debate. As the defender of the interests of Back Benchers, I make a special appeal for very short contributions from Privy Councillors, even from the Front Benches, and from Back Benchers too.
  3.42 pm
  The Secretary of State for the Environment (Mr. Patrick Jenkin): I beg to move, That the Bill be now read a Second time.
  The Government were elected in 1979 on a policy to restore the ability of this country to earn its living and to sustain and improve the standard of living and the quality of our public services. At the heart of that policy has been the need to curb the demands made both on individuals and on businesses by the public sector by reducing the burden of public spending and taxation. As a consequence of the measures taken so far, which were endorsed in the general election in June, inflation has come down and is set to fall still further, competitiveness is now improving, business confidence is now reviving, we are climbing out of the recession ahead of many of our competitors, and although much remains to be done the prospects for the British economy look better than they have looked for many years. If we are to achieve our goals, we must continue to urge restraint in public spending and work to reduce the taxes that people and businesses have to pay.
  The Bill is about local public spending and local taxation. Although some have sought to deny it—I think that the right hon. Member for Manchester, Gorton (Mr. Kaufman) did so—successive Governments have always regarded local government expenditure as part of public spending. Rates are certainly part of taxation. I do not need to remind the House of how my Labour predecessors, in the years up to 1979, called on local authorities again and again to make substantial cuts in spending in order to strengthen the economy and defeat inflation. In 1976 the right hon. Member for Bethnal Green and Stepney (Mr. Shore) demanded of local authorities a 7 per cent. volume cut over four years, chiefly from capital spending. A year earlier the late Tony Crosland warned local government, speaking in the town hall in Manchester, "The party's over."
  In the past local government has, by and large, responded. The local authority associations, then and now, accept without question that it is the responsibility of the Government, accountable as they are to the House, to set the total of public spending and that it is the responsibility of local government to abide broadly by the guideliness that have been set.
  When the Conservative Government came into office in 1979 the volume of local authority current spending was set to rise by about 6 per cent. over the four years to 1982–83. Clearly that was inconsistent with the Government's policy objectives. Accordingly, in the 1980 rate support grant settlement, my right hon. Friend the Member for Henley (Mr. Heseltine) called on local
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  authorities as a whole to cut the volume of their current spending in 1981–82 to a level around 5½ per cent. below the outturn for 1978–79.
  What happened then is a matter of history. Instead of reducing current spending, local authorities as a whole increased it and this year, 1983–84, local authority budgets are running 4 per cent. above the 1978–79 spending in volume terms. In cost terms, taking account of general inflation, the increase is 9 per cent. That is the measure of the increasing burden local authorities are putting on the rest of the economy. In cash terms, spending is now £2½ billion higher than had been intended, equivalent to some £140 for each and every household in the country.
  As we all know, however, that pattern is not even across the country. A few local authorities — and the Government are very grateful to them—have succeeded in reducing their spending. A much larger number have managed to hold their spending pretty well level in volume terms. But a minority have allowed their spending to rise very sharply indeed. The result has been that year after year, after figures for current local authority spending have been approved by the House in the public expenditure debate, my right hon. Friend the Chancellor has had to add back hundreds of millions of pounds to reflect the overspending; and year after year, in spite of thus raising the base line, local authorities as a whole have continued to overspend still further. In this year,1983–84, local authorities have budgeted to exceed their targets by no less than £750 million.
  The crucial fact is that 75 per cent. of this overspend can be laid at the door of just 16 conspicuously extravagant councils.
  Mr. D. N. Campbell-Savours rose—
  Mr. Jenkin: Perhaps I can get further on and then I will certainly give way.
  I should like to give the House a few figures because they tell the story very clearly. Since 1978–79 the average increase in councils' current spending in cash terms has been 86 per cent. But what is one to say about Islington or Greater Manchester, where the spending has gone up 105 per cent. in the same period?
  Mr. Reg Freeson: What about grants?
  Mr. Jenkin: This is spending. This has nothing to do with grants. I should have thought that the right hon. Gentleman would have understood the difference. I am sorry, the right hon. Gentleman's question was not clear.
  What is one to think of Greenwich, where it has gone up 114 per cent., or Leicester or Camden?
  Several Hon. Members rose—
  Mr. Jenkin: Let me get a little further on because it is important that the House should hear the case. What is one to think of Hackney, whose expenditure has increased by no less than 154 per cent.? And of course top of the league, unrivalled for profligacy, is the GLC, whose spending has gone up no less than 185 per cent. Central Government have had to pay the cost of that.
  There is another way to measure overspending and that is to compare it with grant-related expenditure, the assessment of the amount needed to provide a standard level of service. Any authority with a reasonable expenditure policy may be spending at or below GRE but will not be substantially above it. Yet 25 authorities this year budgeted to spend more than 25 per cent. above the

  167
  GRE level. They include Sheffield at 26 per cent. above and Newcastle—I am not surprised that hon. Members express astonishment—at 31 per cent. above.
  Several Hon. Members rose—
  Mr. Speaker: Order.
  Mr. Jenkin: Haringey budgeted at 37 per cent. above GRE, Lewisham at 51 per cent. above GRE, and of course south Yorkshire budgeted at over 76 per cent. above its GRE. The majority of councils which budget close to or, as some do, below their GRE are entitled to feel deeply indignant that this minority—
  Several Hon. Members rose—
  Mr. Jenkin: Here they come, defending the high spenders.
  Mr. Campbell-Savours: If the electors of those local authorities want their authorities to hire more teachers, more social workers, more lollipop women and more social service people, surely it is the entitlement and right of those authorities to provide their electors with those people. Is it not wrong for the Government to interfere and say "No"?
  Mr. Jenkin: The hon. Gentleman is quite wrong. As I said before, all the local authority associations accept that it is the duty of local authorities— [HON. MEMBERS: "No."] Yes, it is—as a whole to abide by the broad general guidelines in spending that are laid down by the House. That was the policy of our predecessors and it is our policy now.
  Dr. Oonagh McDonald rose—
  Mr. Jenkin: No, I shall not give way.
  Of course, with profligate spending on such a scale, it is the ratepayers who suffer. In the four years between 1979 and 1983, while the RPI rose 55 per cent. and earnings rose 65 per cent., domestic rates went up on average no less than 91 per cent. [HON. MEMBERS: "Why?"] In 10 authorities, rates have increased by more than 145 per cent. since 1979–80. The GLC rate went up by 118 per cent. in just two years. [Interruption.] The right hon. Member for Brent, East (Mr. Freeson) was a member of my Department when the Labour Government reduced the rate support grant from 66 per cent. to 61 per cent., and of course this Government have continued the same policy, as the right hon. Gentleman knows, of seeking to increase the accountability of local authorities to their electors.
  Mr. Freeson: Whatever the bandying about between one decade and another on rate support grant levels, can the right hon. Gentleman tell us when, before the advent of this Government, there has been such a major and sharp reduction in central Government assistance to local authorities within such a short period as four to five years? Secondly, will he answer the question that was put to him in the intervention? He complains about the rate increases that he has just listed, but he does not speak about the equivalent cuts in Government assistance to the very authorities about which he complains. Let us have both sides of the story.
  Mr. Jenkin: The right hon. Gentleman is singularly unconvincing, bearing in mind that he was a member of
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  the Department of the Environment when it reduced the percentage of rate support grant from 66 per cent. to 61 per cent. [HON. MEMBERS: "Answer."] Yes, I shall answer. If local authorities had budgeted in line with the targets that were approved by the House, their rates would have gone up, on average, by less than the cost of living. I can justify those figures, and no doubt in Committee we shall be pressed on that matter.
  Let us consider the level of rates. Of course, inner London boroughs are not responsible for education, but the average borough rate in inner London is 52·5p in the pound. In Camden, it is 78p, in Islington 94p, and in Greenwich 99p. In Southwark, it is now the staggering figure of 116p. In the metropolitan districts, which are education authorities, the average district rate is 142p. In Sheffield, it is 199p, having risen no less than 29 per cent. in two years, and in Newcastle it is now 216p.
  Mr. Keith Speed: Am I correct in assuming that if the rate support grant had stayed at 60 per cent. the rates, on average, instead of going up by 95 per cent. between 1979 and 1983, would have gone up by only 62 per cent.?
  Mr. Jenkin: My hon. Friend is experienced in these matters. He will know that it is difficult to gauge what might have happened. [HON. MEMBERS: "Oh."] It is not simple arithmetic. [Interruption.] If Labour Members will allow me, I shall answer the point, although it is not a simple question. If reducing the proportion of rate support grant, as the previous Government did, increases the accountability of local authorities to their local ratepayers, which it does, one cannot say what the spending might have been if the reduction had not been made. That is a simple fact. One can do the arithmetical calculation, and I am sure that my hon. Friend has got that right, but that does not say what would have happened if the reduction in the proportion of rate support grant had not taken place.
  I am sometimes asked whether the purpose of the Bill is primarily to cut spending or primarily to protect ratepayers. The answer is that it is both, because extravagant spending produces intolerable rate demands.
  Mr. Allan Roberts rose—
  Mr. Jenkin: Nearly 60 per cent. of rates in England are paid by non-domestic ratepayers, over—
  Mr. Dave Nellist rose—
  Mr. Jenkin: —two thirds of that share being paid by industrial and commercial firms.
  Mr. Nellist: The right hon. Gentleman is misleading the House.
  Mr. Speaker: Order. The hon. Gentleman must not say that.
  Mr. Nellist rose—
  Mr. Speaker: Order. If the hon. Gentleman is able to catch my eye later, he will be able to make his own speech.
  Mr. Jenkin: I am not misleading the House. If the hon. Gentleman had listened, he would have heard me say "non-domestic ratepayers". Two thirds of that share is paid by industrial and commercial firms. In these high-spending, high-rating areas, industry has suffered grievously from the burden of rates. In Sheffield, the chamber of trade's survey shows that rates per employee, which in 1979–80 were £255 per employee, have risen in

  169
  1983–84 to £787. Industry knows that rates cost jobs and that rates are a larger burden than national insurance surcharge and corporation tax combined. Excessive rates have added to unemployment difficulties in some areas and are certainly one of the reasons for the exodus of small firms from the inner cities.
  I can illustrate that with one or two examples. The firm of Sykes Pumps in Charlton said:
  "One of the main reasons we decided to close our Charlton factory and move to Gloucestershire was the very high rate increases in Greenwich in recent years. This has meant the loss of about 100 to 150 jobs in Greenwich."
  Let us take the case of Cedar Transport, also in Greenwich, which said:
  "The 150 per cent. increase in rates over four years has forced us to increase our charges and we have lost many customers. Our company used to run 39 vehicles, it now runs 6. It employed 50 people and now employs 10".
  There is the plant hire company in Southwark, which said:
  "Next year's increase on top of the 220 per cent. increase over the last five years will take virtually all our profits. We would like to stay in Southwark but we will be forced out. We currently employ 50 people. Most of these jobs will be lost in Southwark".
  Every one of my hon. Friends who represent an inner city constituency will have heard that said over and over again.
  The Government have sought to increase accountability to local electors. The block grant made high spending more expensive at the margin. Local spending targets, with the holdback of grant for those who went above them, put even greater pressure on the high spenders. Supplementary rates have been banned. The Audit Commission has been set up and has started its work. Authorities must publish manpower numbers. Despite all those measures, the overspending has continued. The huge bulk of it is attributable to relatively few high-spending authorities that have made it clear that they do not regard themselves as being under any obligation to pay heed to the Government's guidelines, as endorsed each year by the House. That is the nub of the problem.
  Dr. McDonald: Will the right hon. Gentleman give way?
  Mr. Jenkin: No, I shall not.
  The question for the House is whether we do something about that problem or whether we just continue to let it rip. The Government, after deep consideration of the alternatives, concluded that we had to take action, and the Bill embodies our proposals.
  What would be the alternatives? One alternative, which many hon. Members on both sides of the House hoped might provide a solution, would lie in finding some alternative system of taxation to rates. In the 1981 Green Paper we set out the arguments for and against various forms of local government revenue—raising that might replace the rates. Each of the possible options—a sales tax, a local income tax, a poll tax or a local share of central Government revenues—was examined minutely. Each solution had its admirers, but each suffered from fatal defects. In the event, none could be proved to be a suitable replacement for rates. None could be introduced quickly. There was no evidence that any would have had any impact on local authority overspending.
  There has always been that dilemma. The more buoyant and more painless a local tax might be, the less would be the incentive for councils to economise. If councils were determined to overspend, in the way that I have been describing, the Government would face exactly the same problem, whichever system of taxation applied.
  Mr. Nellist rose—
  Mr. Jenkin: Another alternative would be to transfer a major service such as education to central Government, but surely central financing of education would inevitably lead to centralised control of education. I have never detected much enthusiasm for that solution.
  Many have called for increased accountability, and there are a number of provisions in part III of the Bill that help in that direction. Clause 13 marks an important change in the relationship between local authorities and business ratepayers. In future, there is to be a statutory duty on rating and major precepting authorities to consult representatives of industrial and commercial ratepayers on their budget and rating proposals each year. Many do so already, and where such arrangements are working well we do not seek to interfere. Regulations will specify the information that must be made available to the representatives of business, and we envisage a code of practice that will allow the duty to be implemented flexibly.
  Mr. Nellist: Will the right hon. Gentleman give way on that point?
  Mr. Jenkin: No.
  Mr. Nellist: While the Minister is having a drink, will he give way?
  Mr. Jenkin: While on the subject of business rates, mention two further changes. Schedule 1 will from 1985–86 give all non-domestic ratepayers the right to pay rates by instalments—domestic ratepayers already have this facility. For next year I have made an order to raise the limits for rateable value to £10,000 in London and £5,000 elsewhere. In the following year, the option will be available to all non-domestic ratepayers. I shall make regulations exempting empty industrial properties from rates.
  The Bill includes also an important provision to increase accountability of councils to domestic ratepayers. Many domestic occupiers of council properties — we have heard this complaint over the years—do not pay their rates direct but have them included in their rents. Such occupiers will, from 1985, receive clear notice of their rating liability and a copy of the information about their council's budget which councils send out. We propose also to issue new rate demand rules for 1985–86.
  I do not pretend—I make this absolutely clear—that those measures, useful as they will be, will have more than a small impact on accountability. The real problem is that the link between local spending, local rates and voting in local elections has become very tenuous. More than half of local authority net spending is met by Exchequer grant. Of the remainder raised from rates, nearly 60 per cent. comes from non-domestic ratepayers — industrial and commercial firms, public authorities, health authorities, universities, nationalised industries and a huge range of other bodies. None of those ratepayers has votes, and together they account for nearly 60 per cent. of the half of the money raised locally. Only 22 per cent. of local expenditure is met by the domestic ratepayer.
  The difficulties do not stop there.
  Mr. Eric S. Heffer: What is the next step?
  Mr. Jenkin: Only about 35 per cent. of local electors on average are householders who pay full rates.
  Mr. John Cartwright: Change the system.
  Mr. Jenkin: That is what we are doing. In some areas, the figures are even lower. The proportion of electors who are full ratepayers in Tower Hamlets may be as small as 28 per cent.; in Sheffield it is 26 per cent.; and in Newcastle it is 24 per cent.
  Mr. Robin Squire: Many of us agree with my right hon. Friend's assessment that the present accountability is unacceptably low and should be improved. Will my right hon. Friend explain carefully how this Bill will improve the accountability of councils to their local electors?
  Mr. Jenkin: The House has a duty to step in to protect the ratepayers in those areas with inadequate accountability. Even those who pay full rates in those areas know that on average for every £5 of spending they support they need to contribute only £1. When people talk about elective dictatorships, perhaps that is what they mean. Those who call for greater accountability owe it to the House to explain what they mean. Presumably no one is proposing votes for companies. [HON. MEMBERS: "Why not?"] It would be difficult to achieve. Conversely, are people arguing for the end of rate rebates and supplementary benefits for those on low incomes?
  Mr. A. J. Beith: Is the Secretary of State implying that someone who is assessed by the state as being in need of assistance with the payment of rates is less entitled to the full value of his vote?
  Mr. Jenkin: I am not saying that.
  Mr. Heffer: Yes, you are.
  Mr. Jenkin: I am not saying that. I am arguing that, where the nexus between rates and the votes has become as slender as it has in some areas, the system does not work very well.
  Mr. Nellist: Will the Minister give way on that point?
  Mr. Jenkin: I am talking about accountability. Where lies the accountability of local councillors when those who pay most of the rates have no votes while many of those entitled to vote pay no rates? It is hardly surprising that in such areas councillors feel free to spend money like water. [Interruption.] I have said that for most of local government the system works reasonably well, although I am sure that more councils could run their services more economically and efficiently. The real problem lies in the small minority where the system has broken down.
  Mr. Guy Barnett: Will the Minister give way?
  Mr. Jenkin: No, I shall not.
  Alternative taxes would not solve the problem.
  Mr. Guy Barnett: Will the Minister give way?
  Mr. Jenkin: With respect, I shall not give way as I understand that more than 76 hon. Members wish to speak.
  Several Hon. Members rose—
  Mr. Speaker: Order. I said at the beginning of the debate that I was anxious to call as many Back Benchers as possible. The more interruptions there are, the more difficult that will be.
  Mr. Jenkin: Alternative taxes would not solve the problem, and if we do not contemplate giving votes to
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  companies or abolishing rate rebates, what is left? That is the question to which the House must address itself. Part I of the Bill provides the Government's answer. We have to put an upper limit on the spending and rating activities of the few authorities which have proved impervious to all other pressures. That provision will be backed up by the general reserve scheme which I shall now describe.
  Clause 1 contains the power to prescribe a maximum for the rate or precept of a selected authority. As we have frequently said, we envisage that between 12 and 20 of the highest spending authorities will be selected. Clause 2 provides for selecting authorities whose expenditure appears to the Secretary of State to be excessive having regard to general economic conditions, but the clause also sets out two very important exemptions. Councils spending less than £10 million per year and councils spending below their GRE will be exempt from part I of the Bill. Furthermore, as many local authorities now recognise, because the Government intend to confine selection to only a very few of the highest spenders the mere fact, for instance, that a council may spend a point or two above its target certainly does not mean that it will automatically be selected.
  What, then, will be the criteria? The kind of question that we shall ask is whether a council's spending is exceptionally high compared with that of similar authorities and how its spending compares with its GRE. Under the selective scheme we are going for only between 12 and 20 councils, so obviously we shall be looking only at councils which are spending very substantially in excess of their GRE. The great majority of councils thus have nothing whatever to fear from the selective scheme.
  Mr. Allan Roberts: Will the Minister give way.
  Mr. Jenkin: No.
  There is, however, a second criterion that we shall have in mind. There would be no purpose in applying part I of the Bill to any council which was showing itself ready to cut its expenditure satisfactorily without the need for selection. Here we shall look at the council's performance against its spending targets. If there are councils which, although historically high spenders, are making significant efforts to economise, we should, of course, wish to take full account of that. The 1984–85 budgets which will be settled in the next few weeks will provide the initial basis for rate limitation, so it is not too late even now for some of those high-spending councils to decide to take action.
  One further point should be made. We are, of course, well aware of the devices for manipulating accounts to an authority's advantage—the so-called "creative accounting." In determining which councils to select for rate limitation we shall look at genuine spending levels and genuine spending reductions.
  Mr. Nellist: Will the Minister give way?
  Mr. Hal Miller: Will my right hon. Friend give way?
  Mr. Jenkin: I give way to my hon. Friend the Member for Bromsgrove (Mr. Miller).
  Mr. Nellist: What about the Opposition?
  Mr. Miller: On the important subject of the exemption from rate-capping of authorities whose expenditure does not exceed GRE, will my right hon. Friend deal with the position of authorities whose targets are set below their GRE but which are subject to penalty in other respects?
  Mr. Jenkin: I entirely understand my hon. Friend's point.
  Mr. Guy Barnett: Will the Minister give way?
  Mr. Jenkin: No, I am answering my hon. Friend's point. I fully understand the point and shall refer to it, if I may so put it, obliquely later in my speech.
  Mr. Martin Flannery: On a point of order, Mr. Speaker.
  Mr. Speaker: Before taking the point of order, I appeal once again to the House to let the Secretary of State finish his speech. That will enable more Back Benchers to be called. Interruptions take up a great deal of time.
  Mr. Flannery: My point of order is this, Mr. Speaker. The Minister seems to reserve special venom for Sheffield, which he has mentioned no fewer than five times. Would it not be reasonable for him to give way to the Opposition just once on this as he is prepared to give way whenever a Conservative Member seeks to intervene?
  Mr. Speaker: The Minister gives way to whomever he wishes, but I hope that he will not give way too often as it takes time from the debate.
  Mr. Jenkin: I have given way to more Opposition Members than Conservative Members. Perhaps I may now continue my description of the system under part I of the Bill.
  Having selected the authority, we shall then fix the level of spending under clause 3. If an authority feels that it has special problems in cutting spending, it can ask for that level to be raised. If the level can be agreed, well and good—under clause 4 the appropriate maximum rate would follow. If no agreement is reached, however, it will be for the Government to put their proposals for rate limits to the House and for the House to give its approval before the limit takes effect. Once a rate limit is set, the authority cannot go above it. It will be a legal maximum and if the authority tries to set a higher rate its ratepayers will not have to pay it.
  To deal with an aspect raised in the press and elsewhere, there can be no doubt whatever that the proposals in part I of the Bill will result in a significant reduction in the level of local spending. Perhaps I may describe what would have happened if this selective capping power had been on the statute book in time for 1983–84. Eighteen authorities increased their current spending between 1982–83 and 1983–84 by 12 per cent. Assuming inflation at about 5 per cent., that is a volume growth of an average of 7 per cent. in one year. If our rate-capping proposals had restricted the expenditure of those authorities so that they reduced the volume of their expenditure by, say, only 3 per cent., spending would have been £300 million less than it is now likely to be—in just one year. Over a run of years, and taking into account the response of other authorities to the Bill, I have no doubt that the savings will be very substantial indeed.
  Part I of the Bill therefore does precisely what we said in our election manifesto we should do, that is,
  "legislate to curb excessive and irresponsible rate increases by high-spending councils".
  Mr. Roland Boyes: Will the Minister give way?
  Mr. Jenkin: I come now to the second leg of this policy—part II of the Bill—which provides for the
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  reserve scheme. I fully understand the anxieties which have been expressed about this, but perhaps I may set them in context.
  First, the Government hope that this part of the Bill will never have to be invoked. We hope that the powers in part I, coupled with the existing system of block grant, expenditure targets and the other measures in the Bill, will bring local government spending into line with the Government's guidelines. Accordingly, the Bill provides firm safeguards. Part II can be brought into force only after consultations with the local authority associations and then with the approval of each House of Parliament by means of an order subject to the affirmative procedure.
  In clause 10(2) there is also a power to exempt authorities from part II in any year by reference to spending levels. I am sure that Parliament would wish to be satisfied about any proposed exemption before approving the main order. I attach great importance to those safeguards. They ensure that the authority to introduce the general scheme rests firmly with both Houses of Parliament and that Parliament cannot act without the views of the local authority associations first being ascertained.
  I know that many of my right hon. and hon. Friends are concerned about the circumstances in which it might be necessary for the Government to put to Parliament a proposal to introduce the general rate limitation scheme. Under part I, the selective scheme will catch the highest spending authorities. There is, however, a second tier of overspenders, less serious perhaps, whose spending and rating is certainly contributing to the overall problem, but who will, I believe, respond not only to the pressures of the grant system but also to a very real desire to avoid rate limitation under either the selective or the general scheme. There are as well, of course, the 80 per cent. of responsible authorities which are at present budgeting at or close to their targets.
  What I would say to the House, therefore, is this. Any decision about whether there should be a move to general limitation must depend on the future spending decisions of not just a few authorities but of a significant number of authorities. If it becomes apparent that, for whatever reason, a substantial block of authorities are spending irresponsibly and so are pursuing a course calculated to overturn the Government's expenditure plans, we should have to consider asking the House to implement the general scheme. But I repeat that we do not want to have to do that. Only if the spending decisions of a substantial number of authorities cause us to act would we contemplate asking the House to activate the power.
  Mr. Nellist rose—
  Mr. Jenkin: I said at the outset of my speech that I understand the fears of those who dislike this legislation, not least those felt by local government itself, but it is not only on this side of the House that the excesses of some of the councils whose spending and rating behaviour are the root cause of this legislation have aroused disgust. I know that there are many in local government and many hon. Members of all parties on the Opposition Benches who deplore the way that some councils have been conducting their affairs. Some of the most responsible low-spending councils have in a sense had to pay the penalty for the excesses of the few. Because we have been

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  unable to put a curb on those excesses, I and my predecessors have had to fix targets and hold back regimes that have made life extremely difficult for the many.
  In addition, because of the overspending on current account, we have had to look for savings on capital account, something that I am sure none of us would have wished to see. If the House gives us the power in the Bill to curb the excesses of the few extravagant, irresponsible high spenders, I believe that we can look forward to restoring that traditional relationship with the vast majority of local authorities that have served this country well in the past.
  In the meantime, when one has councils whose spending has risen nearly twice as fast as the average, councils whose spending exceeds GRE by as much as 20, 30 or even 50 per cent., councils whose rates have risen three or four times as fast as the cost of living, councils where the small proportion of domestic ratepayers who pay full rates are powerless to curb that headlong rush to profligacy, I say that it is the duty of the House to act. We have a duty to protect ratepayers from blatant exploitation. We have a duty to ensure that all parts of the public sector work within national economic policies. Other efforts to make these few authorities see reason have failed. That is why we seek the powers in the Bill, and I commend it to the House.
  4.24 pm
  Dr. John Cunningham: It is widely believed that the Bill being discussed today is one of the most fundamentally important measures to come before Paliament for a very long time. It is appropriate and fitting that there is such a high attendance for the debate because, if enacted, this measure will give the Government and Whitehall control over a wide range of aspects affecting the everyday lives of millions of people. That would be a very serious and fundamental change, and Parliament should pause and deeply consider whether such change is justified or necessary. Hasty and ill-considered constitutional upheaval could have very serious consequences.
  We have just heard a rather pathetic speech by the Secretary of State.
  Mr. Nellist: Not rather pathetic; very pathetic.
  Dr. Cunningham: It is the culmination of a lamentable performance over several months by the Secretary of State to persuade the House that the Bill has any vestige of merit. He was devoid of conviction, which is not surprising because his case lacks any sound principle and intellectual foundation.
  No one in the House interested in democratic freedoms, local choice or local decision-taking, no one interested in the decentralisation of power, no one who opposes bureaucratic central control—Whitehall domination—could espouse the case embodied in this most sinister measure to control freedom proposed by any British Government this century.
  Mr. John Heddle (Mid-Staffordshire)rose—
  Dr. Cunningham: It is safe to conclude from his performance that, when these proposals came before the Tory Cabinet during the last Parliament, the Secretary of State was in the majority which decisively rejected them
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  on no fewer than four occasions. The Bill will do nothing to redress the manifest failure of the Government to resolve the major difficulties of local government finance, which are largely of the Government's making. Nor will the Bill do anything to reform the rates, as is claimed.
  The Bill is not about rates reform, and it is quite deliberately and misleadingly named. The Bill should more accurately be called the "Abolition of Local Democracy Bill". Its central purpose is to eliminate the right of local communities to elect councils that will provide the level of community services that people desire.
  The Secretary of State said that there was a tenuous link between local voting and rates. The tenuous link is between local voting and the Conservative party. That is what the right hon. Gentleman is really concerned about. The Bill aims to prevent locally elected councillors from deciding what priorities to choose for the people who vote them into office.
  Mr. Heddle rose—
  Dr. Cunningham: The Bill seeks to allow Ministers and civil servants to negate local democratic elections and to give bureaucrats more power over the budgets and services of towns, cities and counties than their elected councillors. Little wonder, then, that the Bill has been so comprehensively "rubbished" by all local authority associations, the professions, the press and the academic world. It is to the credit of Tory leaders in the Association of County Councils and the Association of District Councils that they have clearly and concisely denounced their own Government's policy. The Bill is a complete rejection of the Conservative party's long tradition of local government independence and has aroused more opposition from the grass roots of a party in government than any Bill in memory.
  In this House, too, serious doubts and fundamental objections have been expressed in ever-growing numbers. We shall see this evening the true nature of the Conservative party displayed. If the Bill is given a Second Reading, the Conservative party will have totally forfeited any claim to be the party of individual freedom, local domocracy or democratic choice. What price now the 1976 Dimbleby lecture by Lord Hailsham—still a member of the Cabinet—that he entitled "The threat of an elective dictatorship"?
  The reality is that this measure is a giant stride—the most serious and sinister yet — along the pathway to central control of all aspects of life in this country. The Government have consistently followed that pathway in all their legislation. In industrial policy, police powers, the Water Act 1983, health and social security proposals and in their general approach to information, always present, there have been more powers to Ministers and less openness and less public information. In the local government sphere it is a pathway littered with a trail of broken and castaway Tory promises.
  The Government have espoused the cause of elective dictatorship with a vengeance, not just in legislation but in public appointments—in Whitehall, in the nationalised industries, in the Health Service and throughout public administration—and it has been the "one of us" syndrome. The time for this House to call a halt to these dangerous, unhealthy and unnecessary accretions of power to the centre of British Government is now. They will not produce better accountability or

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  better government or improve public administration. Perhaps the present Government can best be described in the words of Sir William Rees-Mogg, a former Tory parliamentary candidate, who said that the Conservatives had
  "ceased to be gentlemen without becoming democrats."
  The Government's case for the Bill rests on a ramshackle framework of dubious assertions, unsubstantiated political claims and wholly dishonest financial and economic arguments. Conversely, the major constitutional change envisaged was given scant regard by the Secretary of State.
  Ministers claim that the Bill is necessary because local government expenditure is out of control, that the medium-term financial strategy is threatened—we thought that had disappeared without trace some time ago—that the rates increases of the last five years have been solely the fault of local councils, that councils are no longer accountable to ratepayers, that only about 35 per cent. of local electors pay rates, that business has no vote, that rates are a tax on jobs and an important part of business costs and that local authorities have broken the consensus and defied the will of Parliament.
  Those points have emerged in speeches by Ministers who have been forced to make such public utterances in an attempt to staunch the melting away of support. It is important to examine this ragbag of half truths, fabrications and deceptions in some detail and, in so doing, to expose the absolute dishonesty of the Government's case. I shall do that now.
  In the fiscal year 1983–84, local government "overspending"—a pejorative claim in any event—is £771 million — 0·6 per cent. of the planning total for public expenditure. Total local government spending has in fact fallen in real terms. While central Government's current spending has risen as a share of national income—from 27 per cent. to 29 per cent. in the last five years—local government's share has fallen from 10·5 per cent. to 10·2 per cent.
  Overall, local government current expenditure in cash terms has, it is true, increased by 90 per cent. in the same period, but central Government's similar expenditure has gone up by 93 per cent. Which is out of control? Who is profligate?
  The major cause of rising rates in the last few years has been the reduction of rate support grant by the Conservatives. This support has been reduced by £2,800 million between 1978–79 and 1984–85. In addition, over that period, an accumulated loss to local government of about £9 billion has occurred. Without those reductions, and with decline in the economy, tax increases of at least 3p in the pound would have been necessary. Instead, the burden was shifted to the rates.
  Much has been made of the impact of rates on industry and jobs. In 1979, when the Conservatives came to office, rates represented 0·6 per cent. of gross output, 1·6 per cent. of value added and 3 per cent. of wages and salaries. If those figures have increased, who has been responsible? All available evidence suggests that rates form a very small proportion of the cost structure of industry. Moreover, industry's share of the rate burden has been falling. In 1975–76 it was 13·4 per cent. of total rates in England and Wales, and by last year it had fallen to 11 per cent.
  The Secretary of State frequently referred to Sheffield, and he mentioned Manchester and Newcastle as
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  overspenders. If we take the increases in net current expenditure since 1978–79—the right hon. Gentleman's own figures, which he placed in the Library in answer to a parliamentary question from me — we find that Sheffield's expenditure has increased by the average increase for all local authority spending; that Newcastle's, at 70·1 per cent., is less than the retail price index; and that Manchester's, at 68 per cent., is lower than that. That is the reality of the situation in those three cities.
  Between 1975 and 1981, rates on business fell by 20 per cent. in real terms. Since then they have risen as the Government have deliberately switched the burden of expenditure from the Exchequer to the rates, and it is no use Conservative Members denying that. The Under-Secretary of State for the Environment, who is to reply to this debate, wrote to Surrey county council in July 1983 admitting it. He wrote:
  "Such reductions inevitably put more of the burden of financial expenditure on to local ratepayers."
  He went on:
  "I recognise that this has marked effects on the share of grant"—
  referring to the reduction of grant—
  "and on percentage increases in rates for authorities like Surrey."
  There we had a Minister from the Department sponsoring the Bill admitting the reality of that fact. That fact has also been made clear in leading articles in The Times and in the Financial Times, most recently today.
  The right hon. Member for Chesham and Amersham (Sir I. Gilmour), speaking on "The World at One" today, said:
  "The reason the rates go up every year is because the rate support grant is cut."
  Sir Robin Day then said:
  "But that is what the Labour party says."
  The right hon. Gentleman replied:
  "It is not a matter of what the Labour party says. it is the truth."
  Compared with VAT, the national insurance surcharge, energy costs, interest rates and the monetarist blizzard that has caused record bankruptcies and closures, rates are relatively unimportant.
  The London chamber of commerce, in a survey of manufacturing and service industries, asked a number of questions about rates and businesses, and a similar exercise was conducted in the south-east. The results, which have been published, show that business men regard rates as of lesser significance than labour costs, payroll taxes, bank charges, other taxes, rent and transport costs. There is not much evidence there to support the Government's assertions.
  Sir Kenneth Lewis: I have a business in the London borough of Camden where there are many small and medium-sized businesses. Rates have become so high in the past year or two years that we have had to cut staff numbers in order to pay for the increases.
  Dr. Cunningham: Presumably that is why the CBI decided to locate its headquarters there.
  As the Financial Times and many economists have pointed out, there are no persuasive macro-economic arguments for the Bill either. Changes in local authority rates expenditure have no significant effect on either central Government expenditure or the public sector borrowing requirement. Councils contribute to the PSBR only through that part of their expenditure already under Whitehall control and supported through the rate support

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  grant. Changes in rateborne expenditure do not affect the rate of monetary growth—for what that is worth—and it is not certain that lower rates would solve any business problems. According to the Department of the Environment's own survey of enterprise zones, a substantial proportion of the rate relief given within zones is immediately offset by increases in rents charged by property companies. The rates are, and always have been, a tax on property. They are not a tax on jobs.
  The Chancellor of the Exchequer recently said that since 1979 local authority current expenditure had risen by 9 per cent. more than prices in general. That is true, but the equivalent figure for central Government expenditure in the same period is over 13 per cent. The Chancellor also said that the yield of non-domestic rates had doubled in that period. That also may be true, but the yield of central Government taxation has also doubled in that period—from £43·1 billion to £87·8 billion. What was the Chancellor trying to prove?
  There is another misconception in the Government's case—that the public sector is unproductive and crowds out private investment. Nothing could be further from the truth. Local authority expenditure provides massive business opportunities for private enterprise. Hence the drive to privatise what local authorities are doing.
  The Secretary of State has said many times—he has said it again today — that only a small number of councils need fear the proposals. Many of those councils — the so-called hit-list authorities—are recognised by the Government as having special problems. They are partnership councils. Rates control in such areas renders nonsensical that most important aspect of inner city policy. More than £400 million is pushed by the Secretary of State and his colleagues into special projects in the very councils where he now hopes to save hundreds of millions of pounds. In reality, the Secretary of State would have to act against several dozen councils to achieve worthwhile savings, unless he intends to decimate services and jobs in the conurbations and cities. That is the real reason why the general power to control any local authority budget in the land is required by the Secretary of State; and that is why that power is in the Bill.
  The bureaucratic nightmare inherent in the application of such powers is clear. One envisages civil servants deciding budgets on South Tyneside, Newcastle-upon-Tyne, Hackney, Liverpool, Manchester, Sheffield, Buckinghamshire or Surrey. One envisages civil servants deciding which services can continue and which must be cut, how many teachers and home helps there should be, and what the level of bus fares should be. If it were not so stupid, it would be funny.
  There is a massive inconsistency between the Minister's statement that he is concerned only to control a few authorities and his insistence on the inclusion in the Bill of such general powers. The general powers have to be there because the Government's real policy objectives are concerned far more with the overall approach of authorities than with the handful of councils that the Minister talks about. The Government know that although they argue that three quarters of the alleged overspending is done by a handful of authorities, a specific power could yield only comparatively small reductions in expenditure in any one year.
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  We must also remember that the so-called specific or selective powers could be generally applied. There are no restrictions in the Bill on the Secretary of State's use of the specific powers. The Secretary of State will exercise his powers to discipline authorities in accordance with principles that he will determine. Those principles do not appear in the Bill, and no restriction is placed upon the Secretary of State's freedom to use them.
  The timetable envisaged is also a bureaucratic nightmare—
  Mr. Patrick Jenkin: Purely as a matter of accuracy, I hope that the hon. Gentleman recognises that the statement of principles has to be laid before the House and that, unless the spending limit is agreed, it is only with the authority of the House that the capping process can take effect. It is not true that it is a matter for the Secretary of State alone.
  Dr. Cunningham: We shall examine the matter in some detail in Committee. The Secretary of State's interpretation of the Bill is different from my own.
  There will be many months of negotiations between the officials of the Secretary of State and the local authorities before anything comes before the House. Until those discussions and negotiations have been concluded, Parliament will have no say in the matter.
  Does anyone who has seriously considered the implications of this fundamental constitutional change really believe Ministers who say that the powers will be used only in a limited way? That would belie the experience of the House and of local government over the past five years. I challenge the Government to clarify their intentions by inserting a limit on the number of local authorities to be controlled under the Bill. That would prove that they do not intend to undermine services and to reduce expenditure across the board.
  In the past few days there has been a slow march of Cabinet Ministers to the lectern to send messages to their constituents in support of the Bill. Perhaps most pathetic of all was the performance of the Secretary of State for Education and Science. Within a week of being told by his own inspectors of the threat to standards in the education service caused by the shortage of resources and announcing an initiative to improve standards, he made a speech in support of the Bill and called on education authorities to cut their expenditure further. What a denial of his obligations and responsibilities that was.
  Since their election, the Government have made seven major changes in the system of financing local government. The resulting instability, confusion, hostility and distrust are plain and all too predictable. At each new attempt to gain compliance, Secretaries of State gave assurances that were subsequently ratted on.
  Clause 2 of the Bill clearly states that grant-related expenditure is now to be used as a test of overspending. The present Secretaries of State for Defence and for Employment assured the House and the local government associations that grant-related expenditure assessments would specifically not be used in that way.
  On 17 May 1982, in answer to a parliamentary question, the Secretary of State for Defence said:
  "I have not at any time proposed grant-related expenditure assessments as the targets for individual authorities." —[Official Report, 17 May, 1982; Vol. 24, c. 5.]
  Earlier, on 8 July 1980, the Secretary of State for Employment said:

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  "Some people have suggested imposing individual cash limits on every authority. That would be a very serious step indeed. … When the public funds have been distributed, it is then a matter for individual local authorities and their councillors as to what their expenditure decisions are. It is their choice between services, their choice as to the volume of expenditure on those services, and their choice as to the rate levels that they decide to impose."
  On the same day the Secretary of State said that grant-related poundage and grant-related expenditure
  "is in no sense a prescriptive definition by central Government of what the local authorities should spend".—[Official Report, 8 July 1980; Vol. 988, c. 304–313.]
  The Conservative-controlled Association of District Councils says of grant-related expenditure assessments:
  "They are grossly unsuitable as individual targets because of the numerous and significant anomalies they contain."
  The Secretary of State now proposes to go back on those commitments.
  To underline those points, it is worth considering a few examples. Grant-related expenditure in Hackney is £59·25 million. Its budget is £81·34 million. Is it supposed that a cut of over £21 million can be enforced upon the London borough of Hackney? Similar arguments apply in Newcastle, south Yorkshire, Sheffield and the Tory-controlled shire counties. The differences between GREs and budgets are often colossal. If cuts of such magnitude are envisaged, some services would cease and areas of local administration would collapse with misery, deprivation, neglect and massive job losses.
  In any case, between 1979 and 1983 Newcastle—on the hit list apparently—and Thamesdown—at the top of it apparently—and Middlesbrough raised expenditure by less than was needed even to keep pace with inflation. Why are those authorities under attack now?
  Local authorities were also promised that the hold-back and penalty system would affect only a few councils. This year, dozens are to be penalised including 23 out of 37 members of the Association of County Councils. Next year, according to the Conservative chairman of the ACC, John Lovill, all members of the Association of County Councils will be affected by the penalty system.
  As Mr. Noel Hepworth, the director of the Chartered Institute of Public Finance and Accountancy, demonstrated in an excellent article in The Times yesterday, the argument about which authorities should be controlled and what tests should be used is exceedingly confused. He also shares the view that these proposals are unlikely to produce immediately, or in the foreseeable future, reductions in spending to the level that the Government apparently require. We understand that the Secretary of State was so embarrassed about the predicament of Reigate that the Department of Employment computer became so overworked that it disappeared up its own VDU in an attempt to find a solution. The list of broken assurances and promises cast aside is one of the principal reasons why all local authority associations have said, "Enough is enough."
  I challenge the Secretary of State to tell the House how much expenditure he expects to save in the first year of its operation if the Bill becomes law. If the Tory manifesto hit list is used and those authorities apparently marked out for abolition are discounted, an overspend of barely £82 million remains. Does the House believe that a major constitutional change is required to tackle that problem, or is the Government's secret intention to control many more council budgets and to slash services to millions of people?
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  It is pathetic and frightening to listen to the arguments that we have had from Ministers in favour of overriding the will of local voters. Apparently, the only manifesto that now matters is the Tory one in general elections, which in 1983 was supported by 31 per cent. of the electorate. We are told that the elderly, disabled, unemployed and disadvantaged should not have as much say as business men about the services upon which they depend. That is a naked attack on local democracy and universal franchise. We are told that business has no vote. That means that Ministers want business people to have two votes.
  Ministers have argued that one person only in a household pays the rates. That demonstrates—
  Mr. Patrick Jenkin: I understand, of course, that the hon. Gentleman —[Interruption.] —wrote those words before he heard what I said. I specifically reject those suggestions.
  Dr. Cunningham: In that case, why have successive Ministers been deploying the argument for so long? Ministers have argued that only one person in a household pays rates, and that demonstrates how little they understand family income and expenditure in ordinary family homes, where everyone who can contributes to the family budget.
  It is also explained that only 35 per cent. of local electors pay full rates and that therefore accountability is diminished. By the same token, only 45 per cent. of national electors pay tax. What are we arguing about? These arguments are spurious excuses for the Government to run roughshod over the local democratic process. No one disputes that Parliament's will is paramount, but the Government have broken the consensus with local government, not the reverse.
  It is untrue that there was ever any agreement between central and local government about aggregate expenditure. The Government's claim that an agreement existed that local authorities' aggregated expenditure should not exceed planning totals determined by Government is a fabrication. Nor is it practicable to suggest that Parliament will decide the detail of individual council budgets and services. That will be done by civil servants — the codification of "Yes, Minister".
  This fundamental constitutional change will not enhance local democracy; it will diminish it. The reasons for the Bill are political and not economic. First, it is an attack upon the public sector—on the public provision of decent services for the community by the community. Secondly, a political response to the appeal to curb local government to make it accountable to more central control will make local government less accountable to local ratepayers. Local authorities make an essential and vital contribution to the well-being of the communities that they serve. They provide crucial services on which the stability and well-being of our society depends — education, housing, public health, the environment, social services and the police.
  The Bill seeks to remove from local authorities the right of control over those services and concentrate power within Government to an extent unparalleled since local councils were created.
  The Bill aims to remove the bulwark of local rights used by councils of all political persuasions to prevent the worst excesses of the failure of the Government's economic

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  policies damaging the interests of those least able to defend themselves. It is a further attempt to redistribute resources away from those who need them most and a further step towards the compassionless society that the Prime Minister seems so determined to establish.
  Coming on top of the disgraceful rate support grant statement in December, the Bill can leave no one in any doubt about the Prime Minister's intentions to subjugate the democratic process as a subterfuge for that unmentionable political reason for this measure and to disguise the fact that the Prime Minister herself has ratted on perhaps the greatest vote-catching promise of all—to abolish rates altogether. In the Bill, rates are to be enshrined in central Government policy — a canon of Tory policy — which is the absolute reverse of that promise.
  The Secretary of State has even threatened to resign if the Bill is not carried. It is worth while remembering that the right hon. Member for Henley (Mr. Heseltine), the previous Secretary of State for the Environment who is now the Secretary of State for Defence, published and then withdrew two local government Bills in the previous Parliament. He neither threatened nor offered to resign. He did, however, threaten to resign, we are told, if rates control was imposed upon him by the Prime Minister and the Treasury—quite a comparison between him and the present Secretary of State for the Environment. The time to stop the Bill is now. The House of Commons should ensure that it is withdrawn.
  What we require are Government discussions with local authority associations, involving all political parties, on the restructuring of local government finance. Such talks should begin immediately to prevent further absurdities from occurring.
  Could the Secretary of State for the Environment, who moved the Second Reading of the Bill, be the same person who, at a Conservative party summer school, said:
  "It is essential that local authority spending programmes should be subject to the democratic control of local councils. Grants can be fixed at such a level that local authorities' expenditure could be made within an acceptable increase in the rates. If any particular authority wishes to spend more than this then that excess must come wholly from the rates. The resistance of local ratepayers could usually be relied upon to prevent extravagance".
  Can the Prime Minister, who has foisted the Bill on her Cabinet, be the same person who said:
  "One must always keep sufficient expenditure with the local authorities; otherwise the whole basis of local government is undermined for good and all. The task of a local councillor who was not responsible for rating would be absolutely marvellous. He could demand everything, the sky would be the limit and he could blame the Government always if he did not get it. It would cease to be local government. It would cease to have any semblance of responsibility whatever. In these circumstances I think I should very much like to be a local councillor. One would get the best of all worlds."
  It would be tempting to say, if only to frighten some Conservative Members, that two can play the game of controlling council budgets. But on behalf of my right hon. and hon. Friends I give Parliament this assurance, and I also give it to local electors—
  Mr. Harry Greenway: A solemn pledge, no doubt.
  Dr. Cunningham: You are such a fathead that you would not know anything about this matter.
  Mr. Greenway: That is an insult to Mr. Speaker.
  Dr. Cunningham: We in the Labour party want none of this Bill. We refute the arguments for it. We denounce the philosophy behind it. It is economically, democratically and morally indefensible. We shall fight it, and I invite all hon. Members who value and support local freedom to join us.
  5.5 pm
  Mr. Edward Heath: The Bill raises for me a matter of principle of the deepest importance. I believe this to be the case with many Conservatives, both inside and outside the House. It goes to the very root of Conservative philosophy, which has endured for centuries. It has always been Conservative philosophy that one of our main purposes in politics is to balance the power existing in our society. In particular, we have been opposed to the centralisation of power because we have throughout realised the intense dangers to freedom that that holds for everyone. The Bill deals with the balance of power betwen central and local government, and weighs it now heavily on the side of central Government.
  My right hon. Friend the Prime Minister said in answer to a question this afternoon that it had long been accepted that the local authorities knew best. With that I agree entirely. If they know best how they wish to carry on their services, they should be enabled to raise the resources needed for those purposes. One cannot say that they know best and then deny them the means by which they may carry out their judgment. Nor can I accept the view expressed by my right hon. Friend the Prime Minister later that, because the House is responsible for financial matters and national taxation, it should therefore take over the responsibility for the rate taxation of local authorities. The logical conclusion of that view is that all local government finance should be taken over by central Government. Of course, some people wish to do that and have so argued for a considerable time. They have said, "Very well, take over the entire education expenditure and the police and all other services and finance them from central Government, and then there would not be a rate burden". That policy has been rejected by successive Conservative Governments for the reasons that I have given.
  I entered the House in 1950 having fought an election on Mr. Churchill's theme that we were to set the people free. The theme was not to set the people free to do what we tell them but to set the people free. With it went a companion theme, that local government should be local. I have fought every election since 1950 on that theme.
  Mr. Nicholas Budgen rose—
  Mr. Heath: The Bill does not accord with either of the two themes set out by Mr. Churchill at that time and to which I, for one, have always adhered.
  Mr. Budgen: My right hon. Friend may remember clause 13 of the Counter-Inflation Bill 1973. When he introduced the White Paper, he said:
  "We also have had to strike a balance between the improvement of local authority services and the impact of rates on the lower-paid. For these reasons we have accordingly increased the rate support grant to local authorities"—
  Mr. Speaker: Order. I hope that this will not be a speech.
  Mr. Budgen: My right hon. Friend continued:
  "and we are asking for powers to monitor the rates position with them to see that the changeover to revaluation is not in any way abused."—[Official Report, 24 January 1973; Vol. 849, c. 472.]
  How does that square with my right hon. Friend's assertions on rate principles?
  Mr. Heath: It squares perfectly well. It was designed to help local authorities in their difficulties. Any Government are entitled to ask for statistics to ascertain how they should help, how much help should be given and whether current help is being used. I am sorry that my hon. Friend should have lowered himself to such a level.
  Secondly, the Bill confers enormous powers on the Secretary of State. It is in his discretion to determine what the criteria are for the action that he takes. The extent to which he applies the criteria lies also within his discretion. Further, it is within his discretion to exempt certain authorities from the criteria without anyone knowing his reasons for doing so. Those are draconian powers in both the selective section of the Bill and in the general powers section. They are powers such as we have never taken before, even in two world wars. This is why I regard the conferment of the powers as a matter of principle of the utmost importance.
  The hon. Member for Copeland (Dr. Cunningham) deployed the pragmatic arguments in postulating whether the operation is worth while. As I am dealing with the issue as a matter of principle, those to me are arguments of a different calibre. However, I agree that it is necessary to ask my right hon. Friend, "But what are you getting in return for taking these draconian powers and for bitter fighting in the House, with Conservative councillors who are our supporters, and with many of those who really care about the constitutional basis of this country?" I deeply resent the accusation that has been made against Conservative councillors who are opposed to the Bill to the effect that they are opposing it purely on account of their vested interests and because they want to feather their own nests. No suggestion could be more unworthy. No councillor has an easy job today, and we should reject that argument completely.
  I have been worried by the difference in emphasis in the White Paper on the purpose of the general powers when compared with what has been said by my right hon. Friends from the Government Front Bench since the Bill was published and the adverse criticism of it arose. In the White Paper it appears to be taken for granted that it will be a simple and straightforward business to take over the general powers if that is what the Government decide to do in the interest of their monetary or financial policies. Since the White Paper's publication, Minister after Minister has said, "That would be done only in the most extreme case." The Secretary of State has emphasised that again today. If my right hon. Friend thinks that that would be done in only the most extreme case, much the best thing would be not to take the necessary power. Let him come to the House and ask for the necessary power if an extreme case arises. The House would then be able to judge whether extreme powers were necessary.
  That is not the entire answer because there is nothing to prevent my right hon. Friend doing everything that he can under the general powers and the selective powers, except for the £10 million limit. That is the only inhibiting factor and that applies only to the smallest of local authorities. My right hon. Friend may say in Committee,
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  "I give up that part of the Bill", but that will not prevent abuse by a Minister of the whole of local government finance except for the smallest entities. As there is no provision for the indexation of the £10 million, the number of authorities that will come under the general powers will steadily increase. An offer from a Minister to abandon the general powers provisions would not alter the argument of principle on this issue.
  I am fully aware of the problems that surround rates. I recognise that there is a difference between this period and that which prevailed 10 years ago. At that time the pressure was for changes in domestic rating. That was understandable because there was a feeling of injustice on the part of pensioners who were single ratepayers who lived next door to a house that was occupied by several wage earners. They felt it unjust that they should have to pay the same rates. In dealing with that feeling of injustice, we extended the rate rebate system extensively in the 1970–74 Parliament.
  Industry remains in a state of depression and obviously feels the burden of rates considerably. It is felt especially by small businesses. We know that from our own constituency experience. That does not alter the fact that when rates are set against the total production of industry and its manpower and other costs, they are seen to be a comparatively small ingredient. Nevertheless, every ingredient matters. But that does not justify the argument that has been constantly advanced that the proposed changes should be made because business men do not have votes. Under our electoral system, there are those who have votes on matters with which they are not concerned and those who do not have votes on some matters with which they are concerned. That is accepted as part of the electoral system. However, we know from constituency experience that many business men live in the constituency in which their business is located, live in the borough and live in the rate-levying authority, and can influence it. Perhaps it would be a good thing if many of them took a more active part in local government.
  My right hon. Friend the Secretary of State says that: in some areas the public are not responsive to what a local authority does or to its rates. Surely the answer is to persuade the people to be more responsive, and as a party we have that responsibility. From time to time the party has had amazing success in some of the Labour-controlled; authorities that have been damned this afternoon.
  One of the many requirements is for local business men, members of chambers of commerce and others to take their part in local government. I welcome the provisions in the Bill for consultation between industrial organisations, commercial organisations and local authorities before the spending programme is set. That shows a movement towards consensus that I feared had been lost some time ago. That is to be welcomed but it is not the same thing as taking part in local government.
  I ask myself how many members of the Institute of Directors are local councillors or do any work for the election of local councillors. How many members of the CBI are so engaged? I recognise that there are notable exceptions, including notable firms that require their members to take part in this work. However, to the great majority, local government is something to be left en one side. We are seeing one of the consequences of that.
  Sir Nicholas Bonsor: I am sure that my right hon. Friend will appreciate that most business men,

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  especially at a time of deep recession, have only a limited amount of time at their disposal. It is wholly unrealistic to expect them to be able to give the enormous amount of time that is now necessary to devote to local government business. How would my right hon. Friend represent, or have represented, the interests of domestic ratepayers who live in areas where the majority of the voters do not themselves pay rates? How are they and the business ratepayers to be protected if the Government take no action?
  Mr. Heath: Those in that position can take part in local activity in the area in which their businesses are based. I appreciate my hon. Friend's argument about the amount of work that business men have to do, but that applies to all sections of society. It applies to professional men and to all others except those who have retired. If retired business men want to take part, I suggest that they should do so. The attitude of putting it on one side is not acceptable.
  In regard to the relationship between local authorities and voters we have made a mistake in the past, with the Greater London council and other authorities, in having a gap of four years between elections. Of course, this was done for a good reason, which was to cut down expenditure on elections and, as some said, to give continuity. But it has prevented the electorate reacting speedily, as is desirable, to the work of a local authority. It has also meant that in the GLC there has been a swing every four years from one side to the other. Therefore, as a practical proposal, it would be useful to move to a system of more frequent elections.
  I do not wish to go into all the statistics that have already been mentioned—
  Mr. Robin Maxwell-Hyslop: A brief speech.
  Mr. Heath: It would be briefer if I was not interrupted by my hon. Friend muttering behind me.
  The general conclusion of those who have examined the statistics is that no major macro-economic benefit will accrue to the Chancellor of the Exchequer or" to my right hon. Friend the Secretary of State by the action which he is taking. If one is judging this purely on the benefits as against the costs, which will be political and much more dangerous, my right hon. Friend will not get any great benefit out of it.
  I wish my right hon. Friend had given more details and an overall balanced assessment of what the burdens of local authorities have been, because they have been much more considerable than he indicated. In my constituency of Bexley there has been a Conservative council for many years. It is now over 22 per cent. above the assessment and some 2 per cent. over the target. Other councils, which have struggled hard to keep down their expenditure, are in a similar position. Councils such as Barnet, which includes Finchley, are all over the target. Local authorities must be given a fairer assessment of their expenditure.
  I want to conclude by referring to the action that I think should be taken. The Government have turned down all alternatives. They turned down first the re-rating of agriculture, which would be a means of getting back some of the money spent on the common agricultural policy. I can understand that the advice may have been that there
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  are political objections to this. With modern technology there could be a local income tax combined with national income tax but its great weakness would be that it would not bring home to the local voter or the local resident what expenditure was being incurred through the activities of his local council. That must be a major disadvantage.
  We have had inquiries on functions and on the structure of local government — Redcliffe-Maud. We have had inquiries on the finance of local government. We have never had a proper inquiry into the relationship between the functions and the finance of local government.
  Mrs. Elaine Kellett-Bowman: Why did my right hon. Friend not institute one?
  Mr. Heath: It has been said that a further inquiry, or discussions between parties on finance, is required. It is necessary to examine finance and functions to get the balance right so that there can be a decision as to whether some functions individually should be taken over by other authorities or by central Government or whether funds should be increased for local government to deal with the burdens that it has.
  I do not want to see the Bill carried through. I ask my right hon. Friend what we would have been saying about centralisation and control from Whitehall if the Labour party, as the Government, had introduced such a Bill. The complexity of the Bill will lead to an enormous growth of bureaucracy. Ministers themselves will not have the time to go into the details of each local authority and it will have to be left to civil servants. Those who are so strongly supporting the Bill but, at the same time in leaders in the press, are damning bureaucracy ought to think about that aspect of it. I do not believe that these powers should be given to the Minister. The Bill should not be kept on the Floor of the House.
  My right hon. Friend has offered to resign. That is the last thing I want him to do. I have great respect and affection for him. I am grateful to him for what he did in the Parliament of 1970 to 1974 and what he has done in the Government since. All I am asking him to do is to recognise that to deal with these few authorities and an amount which is a minute part of either Government expenditure or the public borrowing requirement is not worth a breach of a major Conservative principle. He will gain respect if he takes the Bill away and lets us have a proper analysis of the functions and finances of local government. Let him come back with the answer for that. Then he will get the praise of both sides of the House and of the country.
  5.26 pm
  Mr. Brian Sedgemore: In opposing the Bill I am conscious that no words of mine would be capable of expressing its devastating constitutional consequences or its chilling social concomitants. When the Secretary of State goes to bed at night and shuts his eyes, whatever else he does I am sure that he does not think of Hackney and the poorest people in the poorest borough in the country, according to the 'Z' indices of his Department.
  We have asked the Secretary of State, as a reasonable man, to come to Hackney and see the kind of burdens faced by a society where there is barely social cohesion in the struggle for survival. As an unreasonable man, the Secretary of State has refused to come to Hackney because

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  he is not prepared to face his duties, obligations and moral and political responsibilities. Therefore, the borough of Hackney is doing the only thing it can—it is taking the Secretary of State for the Environment to court, and proceedings are about to start. I suspect that when he appears in the dock he will be found guilty of robbing pensioners, children and the sick.
  The borough of Hackney will ask the High Court of Justice to undertake a judicial review of the operation of the Minister's function under section 59 of the Local Government, Planning and Land Act 1980 and section 8 of the Local Government Finance Act 1982 on the grounds that the Secretary of State's actions have been unreasonable, capricious, unfair and unlawful.
  There are four strands in the thinking behind the impending High Court action. First, the Secretary of State has not paid attention to whether his targets are attainable. Secondly, he has had no regard to the effects of his targets on Hackney's statutory duties and responsibilities. Thirdly, in the targets that he has set for this year, he has maliciously and unlawfully intended to penalise Hackney for expenditure undertaken in previous years. Fourthly, he is in error in assuming that the grant-related expenditure targets that he has set are an expression of the real social needs of Hackney.
  I invite the House to agree that it is arrogant and constitutionally dangerous for the Secretary of State to maintain that he and his civil servants alone know the proper way in which to solve the problems faced by Hackney.
  According to the 1981 census, 17 per cent. of Hackney's population is of pensionable age, 22 per cent. is under 15 years of age. the current rate of male adult unemployment is 26·8 per cent. and 10 per cent. of households have to share a bath. Moreover, two out of three households do not own a car. Hackney has the highest proportion of single parent families of any borough in the country and suffers the worst overcrowding in London. Wages there are 7 per cent. below the national average and more than 20 per cent. below the London average. Babies born in Hackney are 2 lb. lighter than those born in Hampstead because of nutritional deficiency, and 27 per cent. of Hackney's residents were born overseas.
  As councillors in Hackney are struggling to deal with more widespread and intense problems than those encountered in any other part of the country, how dare the Secretary of State, the almighty and omnipotent, tell them how to deal with their problems? That simply does not make sense.
  My plea is that the Secretary of State should have some regard for local democracy in Hackney. He should also have some regard for his being Secretary of State for the Environment. This morning I spoke to officers of Hackney council. They told me that, acting independently of councillors, they conducted an inquiry to assess what cuts can be made. They said that, irrespective of what councillors want to do, even if they were to make millions of pounds worth of cuts in public expenditure, they would still end up £10 million over target if they carried out their statutory duties and basic obligations to meet social needs in the borough. They maintain that the Secretary of State is asking them to do the impossible. They know that that is the truth and are prepared to swear to that effect in the
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  High Court. Is the Secretary of State ordering Hackney to behave unreasonably, capriciously, unfairly and unlawfully? That seems to be the effect of the Bill.
  We have reached present circumstances through two routes. Their cause is not through massive overspending by Hackney but through a series of changed definitions which have operated from 1980–81. As we have changed those definitions from the transitional arrangements to the barest definitions of targets and bases, we have slowly screwed down boroughs, such as Hackney, so that they are now told that they are overspending massively. That is not true.
  On a national level, we already have government by the corporate state. That is not democratic. The Bill will result in the corporate state eliding with and then becoming part of the authoritarian state as state power increases massively. I cannot believe that the British people, least of all the people of Hackney, are prepared to put up with that burden. I hope that the House will oppose the Bill.
  5.34 pm
  Sir Hugh Rossi: My right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) has expressed the greatest reservations about the Bill. He echoed reservations similar to those that others of my right hon. and hon. Friends have expressed elsewhere in recent days. I have no doubt that they all represent areas that are well administered. I can understand that where local councillors are struggling to set the rates at a level which ratepayers can bear, they will feel some resentment that the Government should now find it necessary to reserve for themselves general powers to interfere in their hard work. However, not all local authorities are of that calibre.
  I ask my right hon. and hon. Friends who feel in the way that I have described—for the best reasons and as a result of high principle—not to do or say anything that would mean the loss of the selective powers which are proposed in the Bill.
  My constituency falls within the London borough of Haringey. That borough has the unenviable distinction of being the highest rated in Greater London. The non-domestic rate is now 261p in the pound. Moreover, we have suffered an increase in rates of 127 per cent. in the past five years. The effect of that is devastating.
  Mr. Jack Straw: Will the hon. Gentleman give way?
  Sir Hugh Rossi: No. Mr. Speaker has asked us to proceed quickly, and I am trying to do that.
  People are leaving the borough in droves. They tell me that they cannot afford to live in the area. They move across the borough border — sometimes a matter of hundreds of yards — to Enfield and Barnet where rates levied on identical properties are about one third less than those levied in Haringey.
  Mr. Straw: Will the hon. Gentleman give way?
  Sir Hugh Rossi: No, I shall not.
  Mr. Robert N. Wareing: Tell us about the Tories' rate support grant.
  Sir Hugh Rossi: There are reasons for what I have described.
  In the last 12 years, over which the Labour party has been in control in Haringey, the authority's staff has

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  increased by 30 per month. At the same time there has been a dramatic decrease in population. Schools have closed down because of falling school rolls, but the number of teaching and non-teaching staff has increased substantially. A direct labour force, which is losing money hand over fist, is kept on for doctrinaire reasons in spite of its being uncompetitive. Private property has been bought wholesale and kept empty. I calculate the loss in rates, rents and interest charges from those properties to be about £4 million a year. I could explain why the rates are so high in Haringey compared with other London boroughs. At the root of the problem, however, is bad administration.
  Accountability is another consideration. As I have said before — it is now almost a cliché—the relationship between local government and its electorate is now one of taxation without representation and representation without taxation. When that exists, it is not possible to rely on the ballot box to control the budget as councillors know that they can appeal successfully to elements in the community that they represent which are more interested in expenditure being increased than in rates being under control. That is what appertains in my constituency.
  In such circumstances, it is right — my constituents are asking for it—that the Government should intervene to protect ratepayers by putting a ceiling on rates. That ceiling should be reasonable and responsible, and below it councillors should be free to order their priorities in any way that they wish. There must be such protection, and, under the present system, the ballot box does not provide it. That is my short plea. I hope that my right hon. and hon. Friends will bear it in mind.
  5.39 pm
  Mr. Stan Crowther: The theme of the speech of the hon. Member for Hornsey and Wood Green (Sir H. Rossi) appears to be that if democratically elected authorities do not exercise the powers which the House has given them as he wants those powers should be taken away. That is the heart of the Bill. That is why it is so utterly foreign to the the traditions of the country and the House.
  This is a most extraordinary Bill not simply because of the very serious constitutional consequences but because it comes from a party that is supposed to be philosophically dedicated to freedom and against centralisation. That is what makes it such a strange Bill.
  Today is a very black day for anyone who has any feeling for local government. I know that the many hon. Members on both sides of the House who have spent many years on local authorities, as elected representatives, as I have, will be able to do nothing but shed tears for our democracy if the Bill is given a Second Reading tonight. Democracy began at local level in this country. The local government traditions in England go back far beyond the origins of Parliament itself. The anti-local government campaign that has been the prelude to the introduction of the Bill is one of the most disgraceful episodes in our political history. A propaganda campaign, orchestrated by Ministers and supported by some sections of the press, has completely changed the meanings of some words.
  The word "overspending" has come to mean something quite different from what it meant last year or the year before. Overspending by a local authority means the
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  authority spending more than it intended. According to Ministers, it means authorities spending more than the Ministers intended them to spend. There has been a complete change in the meaning of that word.
  Ministers pretend that the Bill is necessary because some local authorities have broken a sort of gentleman's agreement and are in breach of a convention that the total of local authority expenditure has always been controlled by Ministers. The fiction has been put around that authorities, because they are controlled by nasty, irresponsible people, are in breach of that convention. There never was such a convention. The figures that the Government used to publish on the total of local authority expenditure were never targets but merely estimates. To suggest that local government officers have broken an agreement is an absurd distortion of the truth.
  That point was made by the right hon. Member for Old Bexley and Sidcup (Mr. Heath). I thought that he put his finger on the point very well. I only wish that he had understood the need to get local government finance right before altering the structure of local government in 1971–72. However, I am pleased to note that he has learnt it now.
  There has never been a need for Ministers even to influence, much less control, the total of local government expenditure. There is no economic case for that. The level of rates has no bearing whatever on the national economy, except to the very limited extent that they can affect a company's competitiveness. [HON. MEMBERS: "That is right."] I am glad to hear that Conservative Members agree with me. That extent is vary marginal. I do not want to cover the same ground as my hon. Friend the Member for Copeland (Dr. Cunningham). He made an outstandingly good speech from the Opposition Front Bench. However, I must say something on this point. Rates are a very small element in production costs. I do not know why the Government should feel it right to control that tiny bit while apparently not taking any steps to bring down energy costs, which are a much more significant factor.
  Mr. Barry Porter: What about labour costs?
  Mr. Crowther: Is the hon. Gentleman saying that he wants a statutory wages policy? Let him tell us.
  Mr. Porter indicated dissent.
  Mr. Crowther: That would be the logical outcome of the Government's philosophy.
  If Ministers are concerned about the rate burden on industry, let them tell the House and industry why they have deliberately increased that burden over the past four years by drastic reductions in the rate support grant. My hon. Friend the Member for Copeland made that point, and I hope that it will not be overlooked. I get rather cross when people such as those in the Confederation of British Industry and the chambers of commerce constantly criticise local authorities for increasing rates and do not place the blame where it belongs.
  In my constituency in south Yorkshire, the county council is on the hit list. The Minister regards it as an authority that overspends. Much of its expenditure is on the extremely popular fares policy, which is almost unanimously supported throughout the county. That expenditure is reflected in the precept in the rates paid in my constituency.

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  The rate imposed on industry in Rotherham in the current financial year, despite the heavy precept from the county council, is 132·90p in the pound. In 1979–80 it was 77·53p in the pound. If the 1979 level of rate support grant had been maintained, the commercial rate needed to meet the current year's expenditure would have been only 96·85p in the pound — 36p less. It can be said, quite properly, that if the rate support grant had been maintained perhaps the council would have decided to increase total expenditure. That is fair, but it is speculation. What is an absolutely incontrovertible fact is that almost two thirds of the increase in rates imposed on industry in Rotherham in the past four years is directly attributable to cuts in the Government grant. No one can escape that fact.
  Therefore, the Government's case on industrial rates is totally false. All that is left is the argument about domestic rates. My hon. Friend rightly said that members of households contribute to the rates. It is nonsense to say that only X per cent. of people pay rates. Indirectly, everyone who lives in a house helps to pay the rates. Those are the people who have the right, through the ballot box, to change the membership of the local authority. Surely that is what should happen in a democratic society.
  If the Bill is enacted, the Department of the Environment will become the majority party on every local authority in Britain. That will make a hollow farce of our elections. The Secretary of State should tell the House when he proposes to introduce a Bill to abolish elected local authorities. That is what the path that we are now on is leading to.
  I welcome the fact that some Conservative Members have expressed their opposition to the Bill. I was particularly pleased to hear the comments of the right hon. Member for Guildford (Mr. Howell), who in the debates on the Transport Bill spent a long time expressing the opposite view to the one that he now holds. I am pleased to hear about his conversion. We are assured on biblical authority that
  "joy shall be in heaven over one sinner that repenteth, more than over ninety and nine just persons."
  Those Conservative Members will gain nothing but honour and respect from the public if they vote with us against this appalling Bill.
  5.48 pm
  Mr. Geoffrey Rippon: I am sorry to have to say that I believe that this is one of the most deplorable Bills that has been brought before the House in all the time that I have been a Member.
  The Prime Minister said just before Christmas that the proposal to cap rates was overwhelmingly popular among ratepayers. That may be true, but, if so, it is because the public profoundly misunderstands the nature, purpose and effect of the Bill. Its nature is undemocratic and contrary to the spirit of our unwritten constitution. Its purpose is to create the illusion of rate reform and rate reduction while avoiding the fundamental changes in the structure of local government finance that are needed. The effect will be damaging to local democracy but minimal in its consequences for the national economy or, for that matter, for rates or rating reform. On the Secretary of State's own figures, if this Bill were in operation today some £300 million might have been saved by capping. That is out of a total of over £12 billion of rate expenditure and in
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  relation to a total national expenditure of £126 billion. This is why I say that it is a sledgehammer Bill just to crack a few nuts.
  Before Christmas I told my right hon. Friend the Leader of the House that I thought that this was
  "a classic example of elective dictatorship."—[Official Report, 22 December 1983; Vol. 51, c. 570.]
  and that phrase has been taken up. It is, of course, a phrase taken from the Lord Chancellor's notable book ''The Dilemma of Democracy", in which he argued powerfully that in this country we are halfway between two inconsistent theories about the nature of democracy, indeed about the whole nature and function of government. The first theory is that of centralised bureaucracy, which the Lord Chancellor describes as "elective dictatorship" and the second is that of limited government which is, in the Lord Chancellor's language, the doctrine of freedom under the law. The Lord Chancellor is right when he says that there is ultimately no possibility of compromise between those two theories.
  One of the specific consequences of an elective dictatorship, according to the Lord Chancellor, would be the destruction of local authonomy. "The Dilemma of Democracy" — I think that the Secretary of State for Education rather likes these reading lists — should be compulsory reading for every member of the Cabinet except, of course, the Lord Chancellor, who should simply be reminded that he wrote it.
  In the White Paper the Secretary of State has proclaimed that
  "we live in a unitary and not a federal state".
  That rather over-simplistic view raises the question of what state we live in or what sort of state we want. We are only a unitary state in the sense that Parliament is supreme. We can pass whatever legislation we like, pass this Bill, extend our life, censor the press. The only limitations are moral and unwritten and are based on the acceptance of the need for certain checks and balances, including the maintenance of the historic relationship between central and local government.
  In an article on 5 January, the New York Times pointed out that the rule of law in British society has become very limited by American standards and it commented,
  "talk of Parliamentary supremacy really amounts to giving the executive a free hand."
  Of course, it does not have to be so. If the House has the will, then it has the power to curb the executive. This is the real issue before the House today.
  There may, as my hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) said earlier, be a case for rate-capping selected authorities where it can be shown that they have abused their powers and functions, but each case ought to be examined on its merits and approved by Parliament, because when we rate-cap a local authority we are, as it were, putting it into commission. The criterion for such action should be clearly defined and should be in the legislation.
  The observations that the Secretary of State made today are of no help to us at all. He says that he might do it "on this basis" or "on that basis". This is a totally unfettered discretion that he seeks and that I do not think he ought to be allowed to have. There can be no case at ail to my mind for the sweeping general power sought by the Government.
  It is not sufficient, as the Secretary of State says, for it to be a reserve power which he does not expect to use.

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  If that is the case, why have it? There is no merit at all in the argument that clause 9 provides that this great sweeping general power can be approved only by an order passed by both Houses of Parliament. We know what that means—an hour and a half's debate at ten o'clock with no possibility of amendment. No one can describe that as bringing this sweeping general power back under the control of Parliament.
  A Conservative Government may believe that they will always exercise their power wisely, but that is not a good reason for increased central control. It has never been a principle of Conservative Government, wet or dry, Right or Left, that the gentleman in Whitehall knows best. In fact, we used to go about proclaiming "Town hall, not Whitehall", and how foolish Mr. Douglas Jay was to say that the gentleman in Whitehall really does know best. Legislation should not rely on the good intentions of present Ministers; on the contrary, it should provide restraints on a bad Minister who may exercise power unwisely in the future. My right hon. and hon. Friends are very happy that power should be in the hands of the Secretary of State at present, but suppose that Secretary of State were Mr. Ken Livingstone, who might take the view that it would be right to rate-cap rural authorities that were spending too much so that more money could go into inner city areas.
  Since 1601 every local authority has had the right to levy the rate that it considers necessary to fulfil its statutory functions. That does not mean that it can spend anything it likes. It is bound by the doctrine of ultra vires. Its capital expenditure has always been controlled. For the rest, it must justify expenditure by relation to a statutory function. The only freedom that it has is the so-called tuppenny rate, and there has been criticism because that has been abused. However, even if that were abolished altogether, there could be no more than the saving of the tuppenny rate.
  The truth about this Bill is that, quite apart from it being a major constitutional measure, it is as if the Government are trying to disguise the realities of the rating situation by showing that they are just doing something. In my view, the constitutional issue is so important that, as we have had no debate on the White Paper, the minimum of intervals between First Reading and the debate today and no opportunity, because of the recess, to discuss it in committee, the Government ought to agree to take the Committee stage on the Floor of the House. If they are not prepared to do that on an issue of this kind, I shall certainly vote against the Second Reading of the Bill today. If the Government think so well of the Bill and if it is so popular, they will be only too glad to have its merits proclaimed as widely as possible.
  The truth is that the Bill does nothing to deal with the real problems of rates, rating reform and the distribution of rates. I accept that industry and commerce have a grievance. They pay something like 57 per cent. of the total rate. That is because successive Governments have deliberately moved the burden of rates away from voters to non-voters. We should redress that. We should consider a measure of industrial de-rating. That would create real jobs and real growth. I would certainly be willing to see a measure of that kind go through the House. However, as we have shifted the burden from voters to non-voters, so we have shifted the burden of expenditure from central
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  Government to local government. We say that the rates are a bad tax, yet we have loaded the rates with more and more of the public expenditure. So, in spite of the fact that local authorities have reduced their expenditure while central Government have increased it, in real terms the rate burden has gone up.
  I shall illustrate this by reference to Northumberland. Had the central grant been the same this year as in 1977–78 the rate would have been 103p in the pound instead of 158p. However, I do not think that many of the ratepayers really understand how this has been done. It may be right for the Government to reduce general Government expenditure and the general contributions to rates, but the Government should not then pretend that this has no effect on the rate bill that is presented. No one suggests that local authorities should have complete autonomy when central Government provide so much of the expenditure, but the powers of this Bill are totally unnecessary and will lead to greater confusion.
  We have been told that there have already been seven grant systems and four Bills, two withdrawn. We could make this another. As a result of what the Government have already done, the local government finance system is in utter chaos. It is a complex, unscientific, muddled mess and whether the authority is extravagant or prudent, Socialist or Conservative, it does not know from year to year, even month to month, what grant conditions are to be imposed. The Bill does nothing to improve that situation. The Government have come to the conclusion: "Something must be done. This is something. Let's do it." Once again, we shall find that they have produced a measure that will make a badly handled situation worse. Once again, we shall find that the parliamentary convenience of today will become the parliamentary embarrassment of tomorrow.
  I must say in conclusion, having been involved in local government for much of my political life, that I feel a sense of despair that a Conservative Government are bringing to the House a measure that is so basically bad, so potentially dangerous and, in the final analysis, so pathetically inadequate.
  6 pm
  Mrs. Renée Short: The Secretary of State made a puny and unconvincing speech when he introduced his Bill this afternoon. The Bill has been condemned by every Conservative Member who has spoken in the debate. My hon. Friend the Member for Copeland (Dr. Cunningham), speaking from the Opposition Front Bench, dealt with the Bill very powerfully. The strength of the arguments that he advanced should have convinced the whole House that we should not vote for the Second Reading tonight and that the Bill should be thrown out.
  The Secretary of State said that the Bill was about local tax. He also said that it was about local spending. He should have said, if he wished to describe the Bill adequately, that it is about local coercion—coercion of local authorities to do what the Government intend them to do—which will have a devastating effect on the local services that are provided by local authorities.
  The Government intend, in the Bill, to take direct control over rating, and thus over the expenditure decisions of local authorities, taking away the right of local authorities to make their own decisions. That will deny local electorates the right to decide for themselves the

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  expenditure policies that they wish to pursue. Thus, central Government will be a dictator, telling local authorities what expenditure decision they may make. Councillors will become puppets of the Government, carrying out only policies approved by this Government, and having the freedom merely to do what the Government
  Hitherto local government has had the power to make decisions to spend money on policies and programmes presented to its electors. I speak as one who for many years before I came to this place was a member of a county council, and a rural district council. Those policies and programmes are approved by a majority of voters at elections and are then carried out by the council after the election. That is democracy, is it not?
  I shall quote the words of the Minister then responsible for local government in 1980, in the Standing Committee considering the Local Government Planning and Land Bill:
  "My Department will not be in the business of saying how much each authority should spend, where it should or should not make cuts or on what it should spend money … We have said that our concern is the distribution of public money … the ultimate decision on rating and on the volume of expenditure on local authorities is a matter for the councillors themselves."—[Official Report, Standing Committee D, 27 March 1980; c. 840–41.]
  That is what the Secretary of State is now denying to local authorities. It was as described in 1980, and so it should continue to be. If electors do not care for the way in which councillors spend ratepayers' money, they always have a remedy: they have the opportunity, at elections, to vote the councillors out of office.
  The concentration of more and more power in the hands of this Government poses a threat to democracy. To sweep away the budgetary freedom of local authorities, merely because their ideas about the use of that freedom are different from those of this Government, is both dangerous and scandalous. In a unitary state such as we have, local government has considerable responsibility—far greater than in a federal state — because it is only the democratic, elected check on the concentration of all Government power in one central dictatorship. I hope that local electors will make sure that all Tory councillors and candidates who support this Bill are defeated when those electors next have the opportunity to vote. I hope that they will bear in mind, when the next election comes around, that those Conservative Members have had the nerve to go into the Lobby and support the Bill tonight.
  I remind the House that if we had a Secretary of State who believed in subsidising urban public transport, for example, many of our so-called overspending local authorities could become underspending local authorities overnight. This measure means that henceforth the Secretary of State will be involved in the detailed budgetary process of every local authority, interfering in business that is not his business. He will have to have regard to their balances and their levels of spending. Will he then tell local authorities where specific cuts have to be made? Will he dictate to them how to carry out their duties? Will he tell them what to spend or not spend on particular services? Perhaps the Minister will reply to these questions.
  The Bill represents an unprecedented increase in the dictatorial powers of this Government. As a consequence of this Government's majority, Parliament will be quite
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  unable to help any local authority that appeals against the dictatorial powers of the Secretary of State. Arbitrary power will replace local budgetary processes.
  My own local authority has managed—frequently by reducing expenditure—to contain the net budget roughly in line with the Government target. However, it is becoming more and more difficult, and the latest projections of our target, GREA and expenditure levels indicate severe problems for subsequent years So although Wolverhampton is complying with targets, the position could change dramatically in a year or two.
  My local authority provides a first-rate service for its ratepayers. It has an excellent school meals service, providing good and well-balanced meals, with a good choice. I understand that the education committee of the Herts county council — an overwhelmingly Tory county council — has just decided to cut out school meals altogether to save £1·5 million. My local authority would never dream of doing that. I hope that the Hertfordshire ratepayers will remember what they did.
  My local authority provides community services for the handicapped, elderly people and small children. There are also services for minority groups, maintaining good relations in a multicultural society. It provides a rich pattern of activities — probably better than those provided by most other local authorities in areas with similar problems. We give a great deal of help to deprived families, whose children are deprived as a result of this Government's policies which have put 3·5 million people out of work and created 18 per cent. unemployment in Wolverhampton. The community services for young people in the area are varied and rich. Those young people are denied the opportunity of getting jobs when they leave school, and instead do a year's activity on some of the Manpower Services Commission schemes, on which the Government are spending money instead of providing proper jobs. My authority believes that we should help young people after that year, thus avoiding the problems that would arise if they were left without help. Many services are provided in my local authority, giving a rich and varied pattern to the community.
  Our GREA in Wolverhampton, at £99·887 million recently notified for 1984–85, is now lower than the Government's target of £100·248 million. So we shall probably spend more than the GREA next year, even if we avoid grant penalties which, of course, are calculated in relation to targets and GREAs.
  It is no argument to say that the Government, for economic reasons, must control expenditure by local authorities if that expenditure is financed by rates. As long as local authorities finance their increased spending out of their local rates and balance their budgets without borrowing to cover any deficit, their expenditure poses no problems for the public sector borrowing requirement and the money supply. So why on earth do the Government not leave local authorities to manage their own affairs as they see fit, as they have been given the support and confidence of their local electorate to carry out the policies presented to their electorate at the time of the local elections?
  I hope that Tory Members will join us in the Lobby tonight to ensure that this pernicious Bill is thrown out of the House.
  6.10 pm
  Mr. Fred Silvester: My right hon. and learned Friend the Member for Hexham

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  (Mr. Rippon) said at the beginning of his speech that this proposal has the support of ratepayers, and went on to imply that that was because they were either too stupid or too ignorant to understand the implications. The House responds to talk about large-scale economic policies and principles of the constitution. However, the kernel of this Bill is about ratepayers, people smarting under bills going up by £100 or £200 a year, who see no respite. I shall say something about both economic and constitutional issues before returning to the ratepayer.
  The Government have helped to obscure the issue by justifying the Bill on the ground that Governments must control the total amount of local government expenditure. They say that local authorities account for one quarter of expenditure and therefore must be controlled. However, the Government already do that — they control grants and borrowing and have many statutory and other methods of bringing persuasion to bear on local authorities. As has been made clear in the debate, they have succeeded to a great measure. Local authority total expenditure has fallen. Local authorities take a smaller share of public expenditure now, and a roughly similar proportion of gross domestic product. Without Government pressure, that would not have happened, and without continued Government pressure it will not continue. However, the Bill is not needed for that purpose.
  Nobody believes, in this debate at any rate, that overspending on arbitrary targets by £770 million, or less than 0·6 per cent. of public expenditure, will shatter the economy. We should not look at the Bill from that point of view. That is trying to give a veneer of scientific respectability to the old business of horse trading and political bargaining and negotiation that has been the basis of local and national government for as long as we can remember.
  From the Opposition to the Government, critics hail the Bill as the end of local government as we know it. That is completely untrue. Such people have a romantic view of the independence of local government. Councils never have been, are not and should not be, independent. Parliament lays down their functions, funds many of their services and even lays down rules for their staff. Governments override local policies on schools or council houses and the Government pick up the pieces and pay the bill when things go wrong. For example, what happens to all the costs that arise when the policies of a council contribute to the decline of business activities in the city centres?
  We should be careful how we alter the balance between local and national government, but we must not pretend that we should never do it. The truth is that the case for part II is weak, and my right hon. Friend the Secretary of State has not advanced it very strongly today. This may lead to the demise of part II during the passage of the Bill, but the case for part I is overwhelming. The case starts and finishes with the ratepayer, just as it did when the Government made their original promise.
  I remind the Government of that original promise to abolish the domestic rate. We have reneged on that promise. When the 1981 Green Paper was published we stated again that it was our aim to
  "remedy as fully as possible the shortcomings of the existing system".
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  We have failed in that aim. Nothing has changed. People still perceive rates as unfair and arbitrary, which they are.
  There are some wise people who knowingly say, "I told you so." They will list for one, at the drop of the hat, all the complications, the need for revenue, the lack of agreement about an alternative. They parade the excuses for failure and they exhibit that age-old error of those on the inside looking out—they forget the customer. They forget the poor old ratepayer. The customers have long since made their decision. They want public services paid for in a fairer way than rates, if not entirely then at least in good measure. We gave the original promise for good reasons and the good reasons still exist.
  Instead of switching from the unfair to the fairer we have loaded costs on to the rates. In 1979–80, 8·56 per cent. of general government revenue was raised on the rates. The forecasts for 1983–84 put the proportion at 10·41 per cent. We have raised £2·3 billion more on the rates than if we had kept to the old percentage. The proportion of local government expenditure borne by fairer taxes has fallen from 61 per cent. to 52·8 per cent. My right hon. Friend proposes to switch rate support grant next year towards 51·9 per cent, and I shall have great difficulty in supporting him in that move.
  The Government justify the switch from fairer central taxes to unfair rates by saying that if the ratepayers pay more of the total they will take more interest and bring the councils to account. That is sheer humbug. The White Paper admits, and much has been made of this today, the facts about the sluggish relationship between voting and paying. Practice and theory are widely different. The link is at best sluggish and in some cases non-existent.
  As a result, we have councils of which the composition does not change and in which councillors and officials hardly ever feel under threat. The absence of periodic spring cleaning produces bad, fat and sloppy administration, in which vested interests bed down undisturbed. It would happen to national Governments if we did not throw them out from time to time. The cost of these circumstances is not borne by those who live in the leafy lanes of Conservative shires but by the ratepayers of the long-entrenched big-spending authorities. They need part I, and it ill becomes any of my hon. Friends who have already broken a promise about reforming rates to deny ratepayers this much chance of relief.
  Part I has a limited objective, which is to tackle the profligate. Some local authorities are profligate and some are not. We shall have to make a stab at the worst offenders, and the Bill provides Parliament with the means to oversee that choice. It would be absurd to imagine that a detailed examination of all authorities is expected and in part I the Bill excludes three quarters of them. The Bill provides for a rigorous examination, forcing local authorities into public justification in front of people who have the resources and muscle to be taken seriously. If the high spenders are right, that will soon become apparent. If not, it is time that they were brought down to size.
  I hope that the Government will keep their eye on this simple objective. I am not greatly interested in whether Manchester hits the Government target. Nor am I hoodwinked if Manchester expenditure increases less than the others in percentage terms. As the highest spender outside London, it has room to change. A small increase on too much is worse than a big increase on too little. However, I want to know why it costs Manchester twice as much to empty the dustbins as it costs Birmingham,

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  Newcastle or Bradford, or why it costs 20 per cent. more to educate children in Manchester than in Sheffield, and more than 50 per cent. more than it costs in Leeds. Our dustbins are no cleaner and our children are no better educated. Why is it that if we merely come down to the average for metropolitan districts Manchester could knock £100 off the average rate bill?
  "Individuals and ratepayers' groups tended to favour abolition, while representatives of local government and the professions thought on the whole that domestic rates should be kept."
  Well, they would, wouldn't they? However, local government is for the customer and not for the councillors or professions. We go through a great pretence of independence which gives the councils a nice feeling and the ratepayers a pain in the neck.
  Teachers' salaries are negotiated centrally. The Government in the past have taken charge — they will again — if they do not like the results of the negotiations. About 83 per cent. of police costs are salary costs and, within that, the pay of the police is settled centrally and the establishment approved by the Home Secretary. Higher education outside the universities is paid for out of a national fund and redistributed according to the siting of the institutions. It is a national fund paid out of unfair rates rather than fairer taxes. Those are examples of items better paid centrally.
  We are breaking our promise and imposing real hardship on many ratepayers and unnecessary complications on the local government system in the pursuit of an illusion about council independence. Part I may not be much compared with what we promised, but at least let us use it to give some relief to the hard pressed.
  6.22 pm
  Mr. John Cartwright: I regard the Bill as a logical step along the road of centralisation down which the Government started in 1979, but it is worth remembering that it is a step that the Government implied on a number of occasions that they would not take. Among the many well-thumbed statements made by the Secretary of State for Employment, when Minister for Local Government and Environmental Services, during the passage of the Local Government, Planning and Land (No. 2) Bill is his statement on 27 March 1980:
  "My Department will not be in the business of saying how much each local authority should spend, where it should or should not make cuts or on what it should spend money."
  The right hon. Gentleman continued:
  "the ultimate decision on rating and on the volume of expenditure of local authorities is a matter for the councillors themselves." —[Official Report, Standing Committee D, 27 March 1980; c. 840–41.]
  It will not be a matter for the councillors themselves if this Bill gets on the statute book.
  A number of speakers, including the hon. Member for Manchester, Withington (Mr. Silvester), have made it clear that the Government's economic argument does not stand up to any scrutiny. Even taking the Government's arbitrary decisions on targets, the total overspending is only 0·6 per cent. of total public expenditure. Surely no one is really trying to persuade us that the great economic recovery through which we are supposed to be going will be jeopardised by that type of overspending, especially when it is set against the margin of error of the public sector borrowing requirement or the fact that local government has been far more successful than central Government in controlling its expenditure.
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  A good deal has been made in the debate so far about the burden of rates on industry and commerce. We ought to recognise that rates can be a problem, especially for small firms, when there are sudden, steep rises in rate levels. We cannot disguise the fact that rates are an element in overall industrial and commercial costs. lf the Government are really bothered about the problem, there are far better ways of tackling it. They could take a measure of industrial derating if they felt that that was a way forward. They could take a much better step to transfer the non-domestic rate to central Government. That rate could be replaced by a local income tax as part of a general reform of local government finance.
  The difficulty, as successive speakers have pointed out, is that the Government have been forced to bring in the Bill because they raised expectations that they could not meet. They raised expectations in 1974 about the abolition of the domestic rate. All the talk about the reform of local government finance during the past couple of years raised expectations again. The Government are unwilling or unable to deliver a proper, thoroughgoing reform of local government finance, so they introduced this shoddy Bill as a sign that they were doing something to protect ratepayers.
  The central part of the Secretary of State's speech was about the protection of ratepayers. He made the case that central Government power must be invoked to protect ratepayers against extravagant overspending local authorities. I declare an interest, because I noticed that the London borough of Greenwich figured prominently on the target or hit list — whatever it is called. I have lived in that borough for more than 20 years. I represented the borough on its local authority for nine years, and have represented it in Parliament for another nine years. I am a former leader of that local authority.
  I do not accept that council's spending priorities, many of which are out of sympathy with the average Greenwich ratepayer and voter. But if I were to remove all the things that I dislike in that council's spending — the police advisers, women's advisers, magazines, campaign organisers and the rest of the trendy Left-wing froth—I do not believe that the London borough of Greenwich could get its spending down to the levels that the Government are setting for it without cutting into the services that are vital in a borough that has more than its fair share of social deprivation, which has suffered deindustrialisation very rapidly and very high levels of unemployment.
  To find some impartial support for that statement, I looked up the figures produced by the Audit Commission for Local Authorities in England and Wales, which is a creature of this Government. It was established by the Local Government Finance Act 1982. The Audit Commission has produced a profile of Greenwich in which it compares Greenwich spending with a number of similar London boroughs. Those similar London boroughs were Ealing, Enfield, Hounslow, Lewisham, Merton, Redbridge and Waltham Forest. The majority are outer London boroughs and Tory-controlled. I looked with great interest to see how Greenwich compared with those paragons of virtue. Spending per head of population in Greenwich is £231·50; the lowest figure for that clutch of authorities is £205·10 and the highest is £395·70. The average figure is £310. Greenwich —the focal point of

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  this tremendous ministerial criticism as a wicked overspender—is well below the average of that group of authorities.
  Mr. Patrick Jenkin: The hon. Gentleman is comparing an inner London authority, which is not an education authority, with outer London authorities which are such authorities. I may have misunderstood what he is trying to say. He must compare authorities in the same class.
  Mr. Cartwright: Surely the right hon. Gentleman is not suggesting that the Audit Commission had not noticed that. The services that I am citing are the same for all the authorities in the group. I did not want to delay the House by going through each of the services, but naturally they do not include education because as the right hon. Gentleman rightly said, Greenwich is not an education authority. I was comparing like with like. The Audit Commission also compared like with like. I am not a friend of the political leadership of the London borough of Greenwich, but I say in fairness that those figures do not support the idea that Greenwich is way out of line in its spending levels. Even if it were, I believe that local spending priorities are a matter for local debate and argument.
  I shall back my chances and those of other political opponents of the present town hall regime, and we shall battle this matter out in the right place — the London borough of Greenwich. We have already had some success in parliamentary elections. I should not be a Member of Parliament if we had not. We will fight our own battle. We do not need big brother or interfering auntie from Whitehall to help us in that argument.
  Mr. Peter Bottomley: Surely one of the major points is that if domestic and industrial ratepayers face a rate increase of 59 per cent. in one year, which may be followed by similar increases for another two years before there are local elections when the political bounds of the council may change, it may be too late to improve employment, the standard of living and ratepayers' interests in the borough.
  Mr. Cartwright: I would put my trust in the political ingenuity of my supporters and those of the hon. Member for Eltham (Mr. Bottomley) in ensuring that our case is put before the people of Greenwich and they have a chance for voting for it.
  To misquote the right hon. and learned Member for Hexham (Mr. Rippon), the Government are taking a sledgehammer to crack a few Left-wing nuts and, in so doing, are putting at risk the whole system of democratic local self-government built up over generations in this country.
  There are far better ways to tackle the problem. If we had a fair voting system for local elections, it would be impossible for unrepresentative small groups to take power in town halls on the basis of a very small percentage of the electorate. As the right hon. Member for Old Bexley and Sidcup (Mr. Heath) implied, a local income tax would create a far more direct link between those who pay for local services and those who make the spending decisions. That would do wonders in raising interest in local government and increasing the turnout at local elections.
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  I believe that if local people are given the essential tools to do the job, they will be far better at controlling local authority expenditure than all the bureaucrats in their Whitehall offices.
  The suggestion that there will be a genuine safeguard in parliamentary scrutiny cannot be taken seriously. Clause 2 makes it clear that an authority will be designated for rate capping by an order laid before but not approved by Parliament. Only when the whole process of negotiation is complete will parliamentary approval be involved. Even then, clause 4 provides that the order
  "may relate to two or more authorities."
  How many authorities will be involved? Will there be a mass production line and a conveyor belt system for trundling rate-capped authorities through the House? In any case, how effective will the scrutiny be? None of us is naive enough to suppose that we shall be considering the merits of the case. The Whips will be applied and what the Secretary of State wants the Secretary of State will get. Parliamentary approval is thus a complete charade.
  In any case, I was not elected to Parliament to usurp the functions of the policy and resources committee of a local authority or to go through the budgets of individual local councils. Local councillors are elected to do that job, and they should be told to get on with it. I certainly wish them to be made accountable, but not to a bunch of mandarins in Marsham street. They should be accountable downwards to the people whom they are elected to serve. The Bill confuses responsibility and will give inefficient councils a perfect alibi. After the rate-capping performance, they will be able to say that central Government have interfered and mucked everything up so it is not the councillors' fault that services are bad and rates are high.
  Social Democrats and Liberals reject the whole basic approach of the Bill and the idea that central Government have a right and a duty to control local authority spending. We want alternative independent sources of power and decision making. We reject the dead, cold hand of Whitehall uniformity. We wish to encourage the diversity, the initiative and the sensitivity that are the life blood of genuine local self-government. The Bill threatens that, and we look forward to playing our part in fighting it every inch of the way.
  6.34 pm
  Mr. Reg Prentice: I begin by referring to a figure that my right hon. Friend the Secretary of State used in his speech and that has subsequently been mentioned in the debate. He implied that if the powers had been available for use in the current financial year he might have used them against 18 high-spending authorities, with a saving of about £300 million. I draw two conclusions from that.
  First, the relief for the hard-pressed ratepayers of Islington, Sheffield or wherever will be far more modest than they have been led to expect from Government statements and media treatment of the measure and certainly does not justify a Bill of this consequence.
  Secondly, savings of that order are utterly irrelevant to the Government's macroeconomic problems, so I hope that we shall hear no more about the need for the Treasury to have powers of this kind because local authority spending is about 25 per cent. of total public expenditure. Since 1979, the Government have been more successful than any post-war Government in bringing public spending

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  under control, and they should not be too modest about that. They successfully brought down inflation. They did not need these powers for that purpose then and they do not need them for it now. Moreover, Britain competes in world markets with many federal countries in which the Government have far less power over total public expenditure than the British Government have had for many years. I hope, therefore, that we shall hear no more claims from Ministers about a macroeconomic case for the Bill.
  The Bill will provide no substantial relief for ratepayers so long as the Government intend to use the specific powers only in respect of 12 to 20 authorities.
  Mr. Tony Marlow: My right hon. Friend dismisses the economic case, but since 1979 real expenditure by local authorities has increased by about 4 per cent., which amounts to considerably more than £300 million. My right hon. Friend the Secretary of State did not say that he would have applied the powers as my right hon. Friend suggests. He was merely giving an example. The overall effect would be to prevent local authority expenditure from growing so that the 4 per cent. increase in the past four years could not be repeated in the next four years. The saving would therefore be not £300 million but 4 per cent. over the next four years, which is a far greater sum with a far greater impact on the economy.
  Mr. Prentice: I shall not give way again as we have all been asked to be brief, but I am grateful to my hon. Friend the Member for Northampton, North, (Mr. Marlow) as he has helped me to lead on to my next point.
  The Bill could certainly have a far greater effect if the powers were used more widely than in specific counteraction against high-spending authorities. Even if the general power were never brought into use, there is no limit to the number of local authorities which could be tackled and the extent to which this could be done through the specific powers in part I. Only if it were intended to increase the use of the powers over the years would it be worth while for the Government to introduce a measure of such constitutional importance. We all know from experience that when Governments have powers of this kind they tend to use them more and more as the years go by and there will be pressure every year from the CBI, the Treasury, hard-pressed ratepayers and many other sources, including Members of Parliament, for the Government to use the powers more drastically.
  Against that background, there is clearly a constitutional argument, and I resent the attitude of some people in the House and in the media who suggest that that is not so. If the Bill is to have any real impact, it will alter the balance between national and local government in Britain. If we embark upon such a move at all, we should do so with very great care. The fact that the United Kingdom in a unitary and not a federal state makes local government more important, not less important. In a democracy of this kind, it is vital to have a certain disperal of power among various elected bodies which will sometimes conflict with one another. Parliament, of course, is sovereign, but over many generations Parliament in its wisdom has delegated to local authorities important powers over important aspects of people's lives. Local government in Britain thus fulfils at least part of the function which in a federal country would be fulfilled by the individual states.
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  Local government has been a tremendous success story. I wish sometimes that its spokesmen were not so apologetic and that people in the media who have never served on a local authority would not sneer at it in the way that they do. The fact is that over the last century or more in this country local government has built up a system of public education, a system of municipal housing, many elements in the Health Service, the police force and many other vital public and social services that make up the quality of life in Britain. These have been achievements of local government. To take an example with which I was intimately concerned when I was the Minister responsible for the disabled, in the past 13 or 14 years there has been a great expansion by local authorities of personal social services to chronically sick and disabled people, bringing more dignity into their lives.
  All these achievements are achievements of local government. It might be argued that all this could have been done by some sort of national Government machinery. I suppose that one could imagine a concept whereby every director of education was the county officer of DES or every director of social services was the county officer of DHSS. If that had been the case in the past 100 years, I believe that our public services would have been of lower quality and, incidentally, probably would have cost much more. They would certainly have had to bear the burden of a vast regional and national bureaucracy in order that decisions could be made. For goodness sake, let us not slip towards that position by accident, as we might do if the Bill were fully implemented.
  I preface my other criticism by saying that I condemn as strongly as anyone some of the extreme Left-wing Socialist authorities in the country. The advent of people like Mr. Livingstone and Mr. Blunkett has produced a new ball game. We are looking at local authorities concerned primarily not with serving their communities but with fighting a class war, and that produces a new situation of which the Government have to take note. [Interruption.] My advice to hon. Gentlemen is that they should not keep interrupting. I am on the same side as them, so they ought to listen and, if they care about the future of the Labour party, some of them ought to be condemning the Livingstones and Blunketts of this world.
  What my right hon. Friends on the Front bench propose in this measure would help the tactics of the hard Left in local government because the last vestiges of responsibility will now be taken away. Every budgeting exercise by a Left-wing controlled authority will lose all touch with reality. It may be said that some of them are out of touch with reality now, but they will no longer be under a compulsion to stay in touch with reality. All they need do every year will be to draw up a manifesto.
  Mr. Wareing: Whose side is the hon. Gentleman on?
  Mr. Prentice: I am sorry to prolong my speech, Mr. Deputy Speaker, but I am bound to put in this comment. If one thing would persuade me to vote with the Government tonight, it is the conduct of some Opposition Members. Fortunately, I am immune to that.
  I want to go on to repeat the point that I think has been made insufficiently in the debate. The real decisions every year on the selected authorities will be made by the Secretary of State or, as other hon. Members have said, by civil servants in his Department. All that the councillors need do is to draw up a manifesto. They will then give

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  every pressure group in the locality everything it wants in every department, and they can blame the Secretary of State when the targets are not reached.
  There will be the further consequence, I think, that it will become a kind of virility symbol for the hard Left to be in that category. I want the House to imagine the situation of a Labour-controlled authority in which the controlling Labour group is in what is now called the soft Left category but it has a hard Left element in its ranks and a strong hard Left element in its general management committee. What would they say? They would say: "Why are our comrades in the next town being rate-capped and we are not? Why are we not on the Tory Government's check list? Why are we cosily co-operating with a reactionary Tory Government to keep spending down?" [HON. MEMBERS: "Hear, hear."] When hon. Members cheer, they give strength to the argument. I repeat: it will become a virility symbol of the hard Left to be on the hit list. The Secretary of State will find that, unwittingly, he is encouraging those forces that he is trying to oppose.
  If I may say so, I see some parallel here with the history of the Conservative Government in the past 15 years on the subject of industrial relations. In 1971, for the best of all motives, the Industrial Relations Act was brought in, and it was a practical failure, I think, because of fundamental misunderstandings by Ministers of the time of what made trade union militants tick.
  The trade union legislation passed since 1980 has been very much more successful in dealing with the problems of industrial relations. In the understanding of local government Ministers seem to have reached approximately the same point that they reached in the early 1970s in the understanding of industrial relations. If the Government are trying to fight the hard Left, I wish they would listen to people who know something about it. I believe that they are heading, without intending to do so, for making a bad situation worse.
  Those of us who care about the failure of local democracy will recognise that many changes are needed. One of the basic changes needed is a change in the rating system, or at least the identification and the implementation of some other source of finance to go alongside local authority rates. Ministers ought not to give up the search for achieving that objective. I know the difficulties. I do not want to say this in a critical way, but I think that people throughout the country will expect Ministers to go on looking for an alternative to the rates. The Government could also have some sort of rate capping for non-domestic rates. I think that there is strength in the argument on behalf of the business community.
  Above all, the Government should sit down in genuine consultation with the representatives of local authorities to try to strengthen the accountability of local government. I do not have time to go into my own ideas on that, but I suggest that the questions to be asked are the following. How can we encourage men and women of ability to continue to make the sacrifices that are needed to serve their communities as councillors? Secondly, how can we encourage professional men and women and administrators to continue to seek a career in local government when they might make more money outside? Thirdly, how can we encourage more citizens to take a
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  continuing critical and constructive interest in the affairs of local government so that local government elections become more of a reality?
  These are difficult challenges, and I think they should not be dodged. We shall not encourage any of those objectives if local government is to be clobbered by central Government year after year by some new technique with the Government saying every year, "We were trying something last year, and now we are going to try something else," because people in local government are becoming very discouraged, and their morale is suffering as a result of that process.
  Therefore, I urge my right hon. Friends to think again.
  6.49 pm
  Mr. Ken Eastham: First, I think it is fair to comment on some of the remarks made by the Secretary of State. I felt that it was a very jaundiced presentation. On numerous occasions prior to today's debate we have witnessed the right hon. Gentleman in broadcasts and interviews and statements to the newspapers giving some very distorted views about the real position.
  I represent an inner city, and it is the inner cities that are often at the receiving end of the venom that is regularly pumped out by the Secretary of State. I am sure that every hon. Member with local authority interests has been snowed under by protests about the concept of the Bill. Those protests have come not just from Labour authorities and organisations; dozens of Tory organisations have written to Labour Members, just as, I am sure, they have written to Conservative Members. They have come from voluntary organisations of all kinds, including housing and youth organisations. I shall not delay the House by giving examples. They all state that the Bill would be detrimental to the quality of life.
  The Secretary of State frequently talks about making savings, but we must get the matter in perspective and realise that he is really talking about cuts; and there is a big difference between making legitimate savings and imposing cuts that will be detrimental to the needs of the community.
  The hon. Member for Manchester, Withington (Mr. Silvester) still does not seem to understand the facts of life when he speaks, for example, about education in Manchester. Why does education cost about 20 per cent. more in Manchester than in other cities? That is the kind of question the hon. Gentleman poses, and I will answer him, though he could easily obtain the facts from the local education authorities.
  The inner cities, including Manchester, spend more on education because of the higher percentage of ethnic minority groups who require special education assistance. We also have a higher incidence of poverty in our schools, with more parents appealing for necessary clothing for their children, and many more free school meals are given. We also have the problem of population movement. All those factors increase the cost of education.
  It is wrong for the general public to think that money is being wasted in strict educational terms in the classroom. The environment and the needs of the community in the inner city areas cause the problem. I am sure that the hon. Member for Withington has had that explained to him on numerous occasions. I appreciate,

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  however, that it is more attractive if statements appear in local Tory newspapers to the effect that money is being wasted on education, when that is far from the truth.
  The Secretary of State often blatantly distorts the position when he refers to local authorities being "overspenders", and "waste" is another favourite word of his.
  Dr. John Marek: An example of distortion appears in paragraph 1.22 of the White Paper, where it is stated that during the period April 1979 to April 1983 rates went up by 91 per cent. while the retail price index went up by only 55 per cent. If, in that White Paper, the base point had been taken correctly and if account had been taken of the loss of rate support grant and of the fact that domestic rate relief had stayed still, then instead of the difference being 36 per cent. one way, it would have been 2 per cent. the other way. Does it not lower the authority of this House and of the Government when, although the statements may be right in themselves, together they give the wrong impression?
  Mr. Eastham: I am grateful to my hon. Friend for making the very point to which I was coming next. I tabled a parliamentary question on the subject of rate support grant and received a reply on 21 December confessing that the Government's aggregate Exchequer support had fallen by 10 per cent. in cost terms. Although the Secretary of State keeps telling local authorities that their rates are going up, even a blind man can see some of the consequences of reducing the rate support grant.
  It is dishonest of the right hon. Gentleman to sit with a look of innocence on his face when he does not understand the basic economics of local authorities. I urge him to start afresh and spend a few years in local authority service. Then he may comprehend what the problem is all about.
  Not long ago the Minister for Housing and Construction. accompanied by the hon. Member for Withington and local Conservative councillors, came to Manchester to see some of the housing stock. The Minister spoke of the standards that were demanded and of the need for more maintenance work to be carried out on council houses. Did it not dawn on him that the local authority would be only too delighted to spend more on maintaining its housing stock if only the Government would allow that expenditure? That is an example of the contradictions that occur. In that case the Minister and local newspapers condemned the town hall for not spending more on maintaining council houses, but they did not refer to the consequences of the cuts being made by central Government.
  A few organisations, such as the CBI—in my view, they have been put up to it—have written in support of rate capping. They are on their own in supporting the Bill. After all, in many inner city areas industry has much to answer for. After industrialising areas, its chemical and other spoil heaps have been left for local authorities to clean up. Rivers and canals have had to be cleaned. Industry has left it to local ratepayers to clean up and pick up the bill.
  The Minister quoted two letters to show, he said, that industry had moved to areas where rates were cheaper. He was, of course, making a case for Conservative authorities when he spoke about cheaper rates and the need to protect jobs. I have news for the right hon. Gentleman. Adjacent
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  to Manchester was the largest industrial estate in Britain — Trafford Park. At one time up to 80,000 workers were employed there. Today there are probably no more than 15,000. That is a Conservative authority where the rates are lower than in the other 10 local districts. How does that square with the letters from which the right hon. Gentleman quoted? How can rates be driving industry away and causing the loss of jobs?
  The inner cities have many problems. In the inner city of Manchester—the core of 10 districts—there are three teaching hospitals and the Christie's hospital, which is a specialist cancer hospital. No less than 93 per cent. of the patients at the Christie hospital are not residents of Manchester. However, the Manchester social services department has to pay the social workers who see to the day-to-day needs of those patients. The bill for paying those social workers to support those patients amounts to £1·5 million a year. Does the Minister expect the city to stop supporting and supplying the social workers in those hospitals in order to save money? Does he consider that we are wasting money there? How does the Minister suggest that we should offset some of the financial liabilities that are not strictly the responsibility of the inner city?
  On the other side of the coin, fanning enjoys the highest subsidies of all and pays no rates whatsoever. Nothing is done or said about that. No-one suggests that the fanners should chip in more money towards the costs of the local authorities.
  Before the Government talk about overspending, they might find it useful on occasions to look at their own management. The Public Accounts Committee considers Government overspending. For example, there was the sale of Hamilton house. That building, which was sold for £700,000, was discovered to be worth £15 million. Was that not a waste of public money? We could also consider the Crown Agents. Their speculations may have cost the Government, the nation and the taxpayers hundreds of millions of pounds, but very little was said about that.
  The Government cannot even control their own tax system, yet they have the hard-faced cheek to talk about the inefficiency and overspending of local authorities. From experience, I can say that local authorities are far more efficient about expenditure and accountability than the present Government.
  I agree with the Government that nobody likes paying rates. By the same rule, nobody likes paying taxes. However, people need and demand services, and they legitimately criticise the Government for making handouts to their frends through legislation, for stripping national assets, for privatisation and for the sale of lucrative interests on the cheap. The Conservatives do not criticise such activities, yet they take away the resources that should provide for the day-to-day needs of the less well off in the inner cities.
  The Bill will not improve local government. It will increase the misery of the old, the poor, children and minority groups, and it will affect housing and health. The Minister clearly wants dictatorial powers. I hope that the Bill will be rejected tonight.
  7.5 pm
  Sir Geoffrey Finsberg: The hon. Member for Manchester, Blackley (Mr. Eastham) made one comment with which I agree. lie said that we have all been inundated with letters about the Bill.

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  So we have. They have mostly been duplicated, stereotyped letters, all containing the same parrot phrases originating in Transport House. We have received precious few genuine letters. I can tell those of my right hon. Friends and hon. Friends who are unhappy about the Bill that the majority of the genuine letters that I have received have come from the ratepayers who have to foot the bill. They are not interested in neat, constitutional, university debating speeches.
  I fully support the Bill. However, I am not wholly uncritical of it. It is three years too late. Those of us who had served in local government knew three years ago that the Blunketts, the Livingstones and the Hodges would laugh and raise two fingers if we withdrew the rate support grant and expected the voters to put them out. In the rotten boroughs of Sheffield, Islington and the like, there was no way in which that could happen.
  Dr. Cunningham: Disgraceful.
  Sir Geoffrey Finsberg: Yes, it is disgraceful that the ratepayers have to suffer in that way.
  My right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) has said that he came to the House in 1950 when the slogan was "Set the people free". I was in local government at that time. I had just defeated Anthony Greenwood and Baroness Serota, taking their council seats. I was also an active Young Conservative. My right hon. Friend failed to remind the House of the other half of the phrase. Sir Winston also said "Trust the people".
  Mr. Frank Dobson: Except in Sheffield.
  Sir Geoffrey Finsberg: What the people are saying now is, "For goodness sake, protect the ratepayers." One trusts the people, but in places such as Sheffield and Camden few of those who pay full rates can command a majority of the votes.
  Let nobody pretend that the legislation is unconstitutional. Under the framework of law and custom connecting central and local government, local government has always spent within national guidelines. Until about 1970, nobody argued against that. I am talking about the facts of life, not about constitutional theories. I led Camden borough council during the one period when the Conservatives controlled it.
  Mr. Dobson: Only in part.
  Sir Geoffrey Finsberg: I led the Conservatives there in opposition and in power. In terms of rateable value, it was the fourth wealthiest local authority in the country. In 1968, there was a Tory council and a Labour Government. The Labour Government asked for restraint in local government expenditure. That Government were so unpopular that I could have defied them. I could have said that we would spend as much as we considered necessary. However, I and my colleagues knew that we were not an alternative parliament. We would spend money in accordance with what the Government, of whatever party, said that the nation could afford. If that pattern still prevailed, there would be no need for the legislation.
  I was also at that time not vice-president but deputy chairman of the Associaton of Municipal Corporations, which was Tory-controlled. The chairman was my noble
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  Friend Lord Marshall. We all honourably observed the request of the Labour Government that we should restrain expenditure. There was no need for legislation.
  It is the Left wing of the Labour party that has made the legislation necessary. My right hon. Friend the Member for Daventry (Mr. Prentice) knows a great deal about the hard Left. He knows that the hard Left is deliberately stirring up the Government in order to try to harm local government. As most of us know, the situation suits the book of the hard Left.
  Let us consider the rate burden of Mr. Average Citizen in Camden. There is an ILEA precept and a GLC precept on his residential property, with a rateable value of £500 —less than the rateable value of many properties in Camden. In 1965–66, that ratepayer would have paid £233. In 1971–72 he would have paid £385. In the current year, he will pay £2,537. That is a 1,000 per cent. increase. Part of the cause, of course, is the loss of the Government grant, but that was courted deliberately by ILEA and the GLC. They spend their money on glossy publications, most of whose contents are untrue. They set up committees for which there is no statutory requirement. They spend hundreds of thousands of pounds on political assistants for their elected councillors, none of whom is necessary. There is no requirement by statute for the GLC and the London boroughs to have anti-police committees, women's committees or employment committees. If they were to cut much of this expenditure, life would be much easier. It is, however, even worse—
  Mr. Tony Banks rose—
  Sir Geoffrey Finsberg: I shall not give way. If the hon. Gentleman catches your eye, Mr. Deputy Speaker, he can make his own speech.
  What I resent even more are the despicable tactics being practised by the authorities in Greater London. They are printing cards at the ratepayers' expense for pensioners to fill in. The pensioners are told that their bus passes are at risk, although the Labour party knows that that is a deliberate fabrication. There is a poster campaign throughout London on matters for which they have no statutory responsibility—Ken Livingstone's nuclear-free zones and his anti-racist year. If he understood market research, he would know that he is having exactly the opposite effect to what he wants.
  Worse than that, however, is the fear which is being instilled into ordinary people. I have a letter from a teacher who runs literacy classes. It contains four letters from students, and they all end by saying:
  "Please vote against the ILEA cuts so that our class can carry on."
  Each one uses the same words. That is the type of propaganda that has been put into people's minds. [Interruption.] The trouble with the Labour party is that it hates the truth.
  I have a letter from someone who says:
  "I come from Vietnam. I live in Camden and go to adult classes."
  It finishes:
  "I hope that you will do everything to stop the proposed cuts. I ask you demand the restoration of £150 million rate support grant."
  Who put such words into people's minds for them to send to Members of Parliament? That is the type of spontaneous nonsense that we are receiving. I believe that the people who indulge in such tactics know before they start that the battle is lost and that Parliament will pass the legislation.

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  The Secretary of State spoke about the problems of the business community. Hon. Members will know that not merely the CBI but the Association of British Chambers of Commerce, the London Chamber of Commerce and the Chemical Industries Association all provide jobs for people. They say, as we know, that high rates are driving them out of business, and that is why unemployment is increasing.
  I believe that local government should be allowed to spend only if Parliament has specifically authorised the expenditure in general terms. Let me remind one or two of my right hon. and hon. Friends of certain facts. We all fought the last general election on a manifesto which promised the abolition of the metropolitan counties and rate capping. No one was in ignorance of the Government's determination to put those measures through.
  Mr. Boyes rose—
  Sir Geoffrey Finsberg: If any of my right hon. and hon. Friends said to their electors specifically, "I dissociate myself from that," fine. I acquit my hon. Friend the Member for Milton Keynes (Mr. Benyon), who did the same about the right-to-buy provisions and most of the central legislation that we tried to pass. He and I remain good friends. Anyone who failed to dissociate himself is repudiating his voters, and, more importantly, his workers, because I should not be here and nor would my right hon. and hon. Friends without the hard work of the sloggers who go from door to door, and who raise the 50 pences and the voters who voted for us. They are being let down by any of my right hon. and hon. Friends—
  Mr. Dobson rose—
  Sir Geoffrey Finsberg: —who are not prepared to keep to the manifesto promises which they backed. If they did not dissociate themselves from the manifesto, of course they backed it.
  I am sorry that my right hon. Friend the Member for Old Bexley and Sidcup is not here, but I know that he will not mind my saying that he will recall our commitment to the Common Market in the 1970 manifesto. He will remember the great pressure that there was on certain hon. Members who did not support that legislation. It was said that the voters expected us to do our duty because they had voted for us. I suggest that there is little difference between that manifesto commitment and the recent one.
  I say to the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore), who has just returned to the Chamber, that when I was a Minister in the Department of the Environment I was a partnership chairman and went to Hackney. I told Hackney some of the ways in which it could reduce its expenditure to spend more money on sensible things. Hackney chose not to do so. It threw out its moderate leader and its second semi-moderate leader and it now has the hard Left. It is among the most extravagant local authorities in London. One sympathises with the poor, long-suffering voters and residents of Hackney. Somehow they have to bring themselves to throw out that mob or rely upon the Government to protect them. The Government will protect them by passing this legislation.
  I hope that there is no truth in the belief that there are those, particularly in the media, who are fostering the idea that perhaps the other place might decide not to pass the
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  Bill. The other place also has a convention that if something was a general election manifesto commitment it does not try to block it. I do not believe that it will, but I do not want any of my right hon. and hon. Friends who are unhappy about the Bill to try to build up the other place into thinking that it might be able to do something about it.
  I agree with only one thing that the hon. Member for Copeland (Dr. Cunningham) said. It was his criticism about the Bill's title. The Rates Bill is an innocuous title. I believe that in Committee it could well be amended to something like Relief for Domestic Ratepayers Bill. They are the people who put Conservative Members into power on the clear and specific pledge that they would cap the rates. I am not prepared to let them down, and I hope that my right hon. and hon. Friends will not either.
  7.18 pm
  Mr. Dafydd Wigley: We have heard a speech that has had one characteristic. It is the first speech that has wholeheartedly supported the Government. If that is the tone of the people who support the measure, the House and the country know much more having heard the speech. The speech had an element of, "Trust some of the people some of the time, but do not trust them if they live in Sheffield or Camden." That is the sort of democracy to which we are coming. We have heard about a democratic means test. Conservative Members who have better fundamentals than the hon. Member for Hampstead and Highgate (Sir G. Finsberg) should think seriously about the Bill. The answer in Camden and elsewhere is to convince the people that the policies are wrong. If the hon. Gentleman cannot do that, he should not hide behind Parliament in forcing through measures that the local people do not want.
  The Bill is cheap, brassy and opportunist, and is before the House because we are debating the failure of successive Governments to respond to the Layfield report and the failure of other Government measures since 1979 to deal with the rate problem.
  I oppose the Bill for three reasons. First, I am opposed in principle to the centralisation that is contained within the Bill, and the constitutional implications of centralisation. Secondly, I oppose the Bill for the practical reasons that it is unfair, discriminating and impractical. Thirdly, the Bill is irrelevant in dealing with the real problems facing Wales.
  We are witnessing the inevitable danger implicit in a unitary state. The saying is that power devolved is power retained. The Bill means that, ultimately, the powers of local authorities will be overriden by the Government. It is not devolution that we need, but a proper framework of local democracy as the only tong-term defence against the centralist command politics that lie behind the Bill is basic constitutional change that will give the nations, regions, counties and districts of these islands formal constitutional safeguards against a centralist enemy.
  As to principle, we are attacking the fundamentals of local democracy. Powers are being removed from properly elected councillors who also fought their elections on manifestos and gave commitments to their electorates. By taking away such power, we are reducing local responsibility. We shall have to live with the consequences of such action in the fullness of time. For every failure of

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  local councils in the future, the tendency will be to blame central Government rather than the local authorities that are carrying the responsibility where it properly lies.
  The Prime Minister said earlier today that democratic answerability exists because Parliament has been directly elected. The reality is that in the areas that the Bill attacks, such as Sheffield and elsewhere, the voters did not elect the Government and did not vote for the programme that the Government put forward at the general election. In other words, the Bill is political, aimed at narrow political purposes. That is a dangerous precedent.
  The Bill is also discriminatory. If two companies in different district council areas are making identical products, one in a council area with an expenditure of less than £10 million and the other in a council area with an expenditure of slightly more than £10 million, the rates may be fiddled by central Government in one area and not in the other. The Bill thus discriminates between the interests of private individuals and companies. Should the Bill be treated as a hybrid Bill, affecting different interests in different ways? That is a constitutional question to which the House should address itself later. It is significant that so early in 1984 we are moving towards central control by Whitehall bureaucrats.
  I am making a practical criticism and not a theoretical one. The idea seems to be that Whitehall knows best what is good for people in various areas of these islands. Inevitably, Whitehall will get involved in the amount of education, social service, housing and road provision in every nook and cranny of these islands. That is a crazy way to move forward. We shall not have better decisions or cheaper services on that basis.
  The objectives described in the consultative document will not be reached in this Bill. The size of the public sector borrowing requirement, which is referred to in the consultation paper, will not be affected. As to protection for the non-domestic ratepayers, in Wales the non-domestic sector paid only 13 per cent. of revenue expenditure in 1982–83. Rates represent only 2 per cent. of manufacturing wages in England and Wales and they are allowable against profits for tax. The real effect of rates is not on businesses but on the purchaser and the taxpayer. If the Government are concerned about the effect on the business ratepayer, why did they reduce the grants to local government, which led inevitably to higher rates?
  Rates have increased from 1974–75 to 1982–83 in the county of Gwynedd by 159 per cent. but the RPI has increased by 210 per cent. Rates have increased considerably less than the RPI.
  The level of grant aid in England has dropped from 66 per cent. in 1976 to 51 per cent. in 1984–85. The reduction is generally accepted to equal a saving of 4p in the standard rate of income tax. The grant was increased initially from 61·5 per cent to 66 per cent. specifically to finance the Houghton pay award to teachers, which is still being paid, together with its successor, the Clegg award. The grant subsequently has been reduced to 51 per cent. and the ratepayer must meet the difference as a result of a calculated and deliberate act of central Government policy.
  The Secretary of State's criticisms about increases in local authority spending are misleading. First, in criticising the percentage increase, he presupposes that the base was correct at the beginning of the period, which is
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  not necessarily correct in many areas. Secondly, he presupposes that there is no possibility of a disproportionate change in need in those areas throughout the period. Thirdly, he used the term "spending irresponsibly", which is an entirely subjective measuring rod and cannot be defined by the Bill or by any of its subsequent regulations.
  The £10 million cut-off for applicability is not subject to indexation and erosion will take place. At present few authorities will be included, but in the fullness of time the limit could affect the vast majority of local authorities, should the Government choose to allow it to do so. Even if the Government do not operate in that way, that does not mean that a successor Conservative Government will not choose to do so.
  The Government claim that business does not have a business vote. I do not like the implication of that. The implication seems to be that because some people have more money than others—I see that some Conservative Members nodding—they should have a larger influence in democracy. If we are going in that direction—I note that some Conservative Members seem to be concurring with that view — the people of these islands should be aware of the fact.
  The Bill applies to Wales, although it is not needed or called for in that country. It does not extend to Northern Ireland or Scotland. I appreciate that the circumstances are different in those countries and that they have different legislation.
  The Association of District Councils in Wales — reference had been made to it supporting the Bill in other areas — does not support this measure. Clwyd and Gwynedd, which comprise 11 district councils, have sent a telemessage saying that they are unanimously resolved to reaffirm total opposition to the Bill. In that area, five of the nine seats are held by Conservative Members in Westminster. Opposition exists in the form of those who represent the Conservative party in the local authorities as well as within other parties. Wales has no need for the Bill because the structure of local government finance in Wales is different. The Secretary of State for Wales, who is on the Government Front Bench, will shortly be introducing orders into the House and we shall have a debate on the RSG distribution in Wales next week or the week after. As I have said, the distribution formula in Wales is different. There is a different treatment of joint funding in Wales when assessing overspending and Wales has different patterns of need in housing and in the old industrial areas. The level of resources is different in Wales. Average per capita personal wealth is only 70 per cent. of that in the United Kingdom. The structure of public bodies in Wales is different, especially the health authorities, as is their interface with the local authorities and the water authorities. People in Wales are demanding better control of the level of water rates but the Bill does nothing about that.
  Few Welsh districts will come over the £10 million threshold and if the Welsh counties are guilty of anything, it is of under-provision in specific areas. The details of Welsh county overspending in 1983–84 shows that it is £20 million on an aggregate target value of £1,034 million, which is less than 2 per cent. The Secretary of State has said that the level will most likely fall to 1 per cent., allowing for budget drift in the future.

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  Wales has no need for the Bill. I hope that if it is not defeated tonight — I will be voting against it— we shall have an opportunity in Committee or on Report to move an amendment to exclude Wales from its provisions.
  7.30 pm
  Mr. David Amess: I rise to address the House for the first time, mindful of the fact that anything I say as long as I am a Member of this place will probably have been said by someone else before me and put more eloquently.
  I am greatly honoured to have the privilege of representing the people of Basildon. The burden of responsibiliy is made all the more heavy by my following no fewer than five extremely able predecessors, all of whom remain Members of this place. I refer to my hon. Friend the hon. and learned Member for Fylde (Sir E. Gardner) and my hon. Friends the Members for Castle Point (Sir B. Braine), for Holland with Boston (Mr. Body), for Brentwood and Ongar (Mr. McCrindle) and for Billericay (Mr. Proctor), all of whom served the House with distinction and diligence. I hope that they will long continue to be Members of this place. I do not wish to forget Eric Moonman, who is no longer a Member of this place but who used to sit on the Labour Benches. He was one of the most hardworking and conscientious Back Bench constituency Members of his time and he is still regarded with great affection by many of my constituents.
  As an East-Ender, I am especially pleased that so many of my constituents were my former neighbours from that most warmhearted part of London. I tried for a number of years to persuade those good people to cast their vote for me but I never persuaded enough of them to do so to enable me to win an election.
  When the electors of Basildon returned me to this place, they created, I believe, a unique circumstance. As far as I am aware, I am the only Conservative Member in this Parliament who does not have within his constituency a county or district Conservative councillor. I hope that I shall prove to be the forerunner of many successful Conservative candidates in Basildon at all tiers of government, and I shall work towards that end. Although there may be an uneasy relationship occasionally between the local Member and the district council in the meantime, I shall not be deflected from the course set when I was elected. I have always accepted the maxim that creative tension is beneficial, and I hope that it will prove to be so in Basildon.
  Basildon was designated as a new town in January 1949. The town has blossomed and grown and has finally matured into one of the most exciting places in Britain. The town can be conveniently divided into Fryerns, Langdon Hills, Vange, Pitsea, Nethermayne and Lee Chapel, all nestling in the heart of the beautiful Essex countryside. There can be few places in the country where the effects of this Government's policies can be so beneficially seen as in Basildon. It is a town which has imaginatively, through the help of the development corporation, grasped its opportunities. The opening of the M25 has further enhanced its attractiveness as a centre for commerce and industry. We have probably the finest shopping centre in the country, if not in Europe.
  We have our problems in the town, but those with open minds are working together to try to solve them. It is self-evident that the future success of Basildon is linked inextricably to a growing and expanding economy with
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  minimal inflation, and it is for these reasons that I welcome the introduction by my right hon. Friend the Secretary of State for the Environment of the Rates Bill. The Bill is a vital ingredient to the success of the Government's economic policies. It is absurd to have a national economic policy that is at odds with a local economic policy.
  Rate reform is long overdue and the Bill will go some little way to meeting that need. I welcome the Bill but there are some aspects of it that I regret. I am still convinced that there is a practical alternative to the present rates system and I am disappointed that the Government feel unable, after great deliberation, to recommend one. The poll tax still has an irresistable attraction for me, if only because of the intellectual exercise of seeing which sectors of our society would be happy to disfranchise themselves.
  Before commenting on the core of the Bill, I shall draw the attention of the House to two clauses that have great merit. I know that clause 13 will be warmly welcomed by representatives of industry and commerce in Basildon, as indeed throughout the country. At long last we have some element of democracy, with the requirement of consultation, remembering that non-domestic ratepayers provide over 50 per cent. of local authorities' income. I hoped that businesses would be given the vote and am a little concerned about the form of consultation and the notice that will be taken of it. I am concerned also about the recommendations that will be made. Schedule I, paragraph 19, widens the circumstances in which rate relief is available to institutions for the disabled. It represents a much-needed change.
  As we have already heard from my right hon. Friend, it is most unfortunate that some parts of the Bill have had to be introduced. In a perfect world where all local councils were under Conservative control, I am sure that such legislation would be unnecessary. The Government have made a genuine attempt not to resort to this type of legislation, but continued non-compliance by certain councils has made this action necessary. It is ridiculous to suggest that the Bill threatens local democracy. Anyone would think that local government was self-financing. It is conveniently forgotten that 52 per cent. of rate fund revenue in 1982–83 in England and Wales came from the national Exchequer.
  Some local authorities have made magnificent efforts to control expenditure and maintain a high calibre of services. The first that I wish to mention is the London borough of Redbridge, where I still serve as a councillor and which includes part of the constituency that is represented by my right hon. Friend the Secretary of State for the Environment. The authority has kept within the guidelines, yet continues to serve the community well.
  Essex county council also runs a tight ship and still manages to maintain services. Oh, that I could wax lyrical about Basildon district council! We have heard earlier how the selective scheme for rate limitation will be applied to relatively few of the high-spending councils, but unfortunately Basildon district council may be among that number. This is an example of an authority that has gone out of its way to thwart the Government's economic policies. Far from merely maintaining services, the council has set about expanding them in the most cavalier and irresponsible fashion.
  I shall give some examples of Basildon district council's wastefulness of ratepayers' money. First, the

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  costs of administration of council houses is five times higher than that of the development corporation. It is about £4 a house instead of 75p. Secondly, there is the cost of unnecessary area rent offices. The office at Laindon, for example, was opened at a cost of £90,000. Thirdly, there is the nuclear-free zone nonsense. The council has given grants to local CND groups and has spent £6,000 on a peace festival. I look forward to the district auditor's remarks on such expenditure.
  Oh, and then there is the "Caring Friend" strategy. The council's theme is that of the caring council, and speaker systems blast out the caring council theme tune all over the town. The council spent £26,000 purchasing a "caring friend" caravan and after a month the wheels dropped off. A sex advice centre for young people called Grapevine has been set up at a cost of £52,000. Golf courses and bowling alleys run by the district authority made a loss last year of £41,800, at least. A legal advisory service has been set up, despite the perfectly adequate citizens' advice bureau, at a cost of £68,000. Wat Tyler park is being built at a cost of £150,000 on a munitions dump in an area where deposits of asbestos have been discovered.
  An officer has now been appointed to advise the adminstration, which amounts to him being a Labour political adviser. A publicity officer has been appointed to the administration; this is really to help the Labour party promote its views through the monthly distribution of the so-called council information sheet "Link"—a platform for the distortion and misrepresentation of Government policy. In Basildon approximately 70 per cent. of rates, representing £8·4 million, goes on salaries and other associated staff costs.
  Despite all this, many companies have been attracted to the area—the Ford tractor plant, Marconi Avionics, Rothmans, Yardleys, the Distillers group and Gordon's gin, to name but a few. Should any business man or entrepreneur wish to find an area in the United Kingdom in which to set up a business there is no finer place than Basildon where there is a willing, enthusiastic and skilled work force available.
  We are fighting hard to attract new business to the area. However, last year Littlewoods, a major retail outlet, pulled out of the area, blaming the high level of rates. Just recently we have had the devastating news that Carreras Rothmans may leave Basildon in April. Whilst I would not single out the level of rates as the main reason, it cannot help when decisions such as this have to be made when there is a rates bill of £0·5 million, particularly when contrasted with the rates paid by other Carreras factories in Spennymoor and Darlington.
  Charity has been described as that amiable quality that moves us to condone in others the sins and vices to which we ourselves are addicted. Full of amiable qualities as right hon. and hon. Members of the Opposition are, and addicted as they may be to using public money to buy trinkets and ideological toys, their vigorous defence of prodigality and inefficiency sterns more from a desire to preserve some corner of a field from reselection than any real commitment to the wasting of money as such.
  I hope that by taking control of the taxpayers' money that is going to local councils, we shall eventually be able to reduce the amounts being taken from the taxpayer. By making local government more efficient we shall ease the burden on businesses. Last June the Conservative party
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  placed before the British people a manifesto part of which contained proposals for the introduction of this Bill. Although the Opposition have never accepted the fact, the Conservative party gained an emphatic victory at the polls and an endorsement of those proposals. We have the full support of the people on this matter and we are determined that the Bill will become law.
  7.43 pm
  Mr. Nicholas Brown (Newcastle-upon-Tyne, East): At the risk of inciting dissent from those behind me, I congratulate the hon. Member for Basildon (Mr. Amess) on his maiden speech. I do not agree with what he said, but it was no worse than the speech of the Minister. I wish the hon. Member well in what time he has in Parliament.
  The Bill is appalling. The only good thing I could find in it was schedule 1, paragraph 19, which gives a small measure of rate relief to disabled people's organisations.
  The Bill is born of dogma, not necessity, and of the argument about the nature of wealth in our society. It is the child of those who believe that all wealth is generated in the private sector and that a good education or a high standard of health care is not wealth but a luxury. This measure is not necessary for the Government's management of the economy. Local rates do not affect the public sector borrowing requirement or the money supply except in the area of capital schemes and borrowing. The Executive already have power to control these. Even what the Conservative party would regard as the most excessive local government expenditure is covered by revenue so it does not affect the borrowing requirement. If inflation is the issue in the management of the economy, the Government must explain the inconsistency in their approach which leads them to see rises in rates as an evil but to insist on rises in fuel costs.
  The real reasons for the Bill are to be found in the parliamentary brief circulated by the Confederation of British Industry and also in the prejudices of the Conservative party. The CBI tells us about the burden of the rates, yet, as we have heard in the debate, nationally rates amount to less than 1 per cent. of industry's costs. The CBI brief states this key fact in a different way; it says that rates yield more than mainstream corporation tax. Quite so. All that proves is that, no matter how agile the accountant is, he cannot find a way for a business to avoid paying the rates.
  We were told that enterprise zones, with their nil rate burden, would help enterprising business men. They helped some enterprising business men but not those they were supposed to help. While the rates have gone altogether, site owners have been able to put the rents up. That is enterprising, but it does not create wealth for anybody except the owners of the sites. I am sure that that is not what was intended.
  The Minister told us of companies whose owners allege that rates have driven them out of business or forced them to reduce the size of their businesses. He has told us that he wants only to curb a few naughty councils and that the rest will be all right if they are good. The Minister is a good Conservative and I am sure that he believes in market forces and leaving business free to respond to market forces. If that is the case, why does he not leave it to market forces, let businesses choose which area they will be based in and let them move from high-rated to low-rated authorities if they wish? Why legislate on the rates?
  Mr. Richard Holt rose—
  Mr. Brown: I have been asked not to give way so as to allow other Back Bench Members to speak.
  The answer is that every business man moans about his rates. He cannot get out of paying them and he cannot reduce them. He would much rather not pay them, but rates do not relate to ability to pay. That is an argument for reform of the rates system and not for decreasing the taxation. If the rates, or their successor tax if one was introduced, related to ability to pay, there would be no income from industrial or commercial sources. Indeed, we might owe them money. Businesses would rather have almost any commercial debt than waste money on paying taxes. Rates are a highly visible form of taxation and therefore are unpopular.
  Closing schools is unpopular too. A petition containing 20,000 signatures was presented at the last meeting of Newcastle city council protesting about the removal of a tier in the tertiary system in the west end of Newcastle. The petition was presented by Labour members, Conservative members and even by a representative of the Liberal party. All were opposed to the cut.
  On the question of housing in Newcastle, the deterioration of the Rochester estate in Walker has reached the proportions of a local scandal. Reports to the city council say that it will cost £8,000 per dwelling to bring the property up to a minimum acceptable standard. That means spending £3 million on the estate. Newcastle has a capital programme that will take 20 years to fulfil at the present rate of progress. It will build 60 homes next year; the waiting list contains 16,000 names.
  The Minister tells us that the city's rates are too high. They are too high, but they cannot be reduced without hurting people. On Tyneside—this is the case not just in Newcastle but in other conurbations — many of the prosperous suburbs are outside the catchment area of the inner city and its rate base, so rates cannot be levied on them. In general, those who have less income have to contribute More to the rate base. How odd it is for the Government to say on the one hand that they will give extra money to help cope with inner city problems through the partnership programme and on the other hand that if we try to deal with structural problems in inner cities through our own moneys they will penalise us. That is a schizophrenic approach; we are given money and then have it taken away. The Bill will simply make matters worse and households which rely on low incomes will be hurt most. Many of my constituents take home £60 or £70 for a 40-hour week, that being the average pay for shipyard labourers whose greed is sometimes referred to during industrial disputes. I much prefer to refer to the facts.
  Other right hon. and hon. Members have spoken extremely well and movingly about the constitutional issue which is involved. They have dealt with the price that the country must pay for the Bill. It strikes a fundamental blow at our current system of Government. I accept that we are not a federal state, but many decisions in Britain are taken locally by locally elected representatives. That will no longer happen. Key spending decisions will be taken away from such representatives, and, in practice, because Ministers cannot scrutinise everything personally, be made by the Civil Service. All effective power to prevent that is now put in the hands of the Executive. The element of local decision making, discussion and votes has been taken away.
  Local councillors will no longer be able to fight an election on whether to increase rates to build a new
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  swimming pool. That is quite a lively issue in the east end of Newcastle. There is no longer any point in fighting an election on such issues as the Government are taking the power to decide whether such spending will be allowed. Therefore, candidates will only be able to say whether they would be advocates of such a scheme if they had the power to implement it. That is precisely the type of decision which should be made locally and it is precisely the type of decision which will no longer be made locally.
  There must be good reasons for making such a fundamental change. The only sound reason that has been advanced is that the Bill was a pledge in the Conservative party's manifesto in the June general election campaign. I accept that there was such a pledge but it took up just one paragraph of a manifesto which previously contained a pledge completely to reform the rating system. How was the electorate to know which pledge would be reneged on?
  What has happened to the party that once fought an election on the slogan "Set the people free"? Why is it now attempting to do the reverse? The Bill is wrong because it undermines our country's constitution, because it penalises those who can least bear it, because it centralises power in the hands of the Executive, because it erodes the accountability of councillors to their electorate and because it fails to meet the points of the very arguments that are used to justify it. It is an intellectually contemptible measure, and I am not in the least surprised that large sections of the Conservative party find it extremely hard to stomach.
  7.52 pm
  Mr. Richard Alexander: It is my great pleasure to congratulate my hon. Friend the Member for Basildon (Mr. Amess) on a refreshing and generous speech. What counts is not how often an hon. Member speaks in the House but what he says and what he does on behalf of his constituents. To judge by my hon. Friend's performance today — he acquitted himself well — the House looks forward to hearing him again and to seeing him being active on behalf of his constituents in the next Parliament as well as this.
  I have been surprised and not a little saddened by the hostility of some of my right hon. and hon. Friends to the Bill. It is easier, when one lives under some councils, to say that everything is going quite well and to forget the excesses elsewhere. However, living in areas of high taxing authorities, such as Nottinghamshire and South Yorkshire, one finds things are different. We joke about the people's republic of South Yorkshire, but it is no joke when trying to run a business there. I understand that the hon. Member for Rotherham (Mr. Crowther) is the only representative of South Yorkshire to have spoken so far. I was interested in his assertion that almost everyone in South Yorkshire supports the bus scheme. I must tell him that that is not so. Many people there bitterly resent having to pay for that bus scheme and regard it as an expensive nonsense.
  Until May 1981, Nottinghamshire was the lowest-rated county council in the country. Since then rates have increased by 67 per cent., and it is proposed that they should increase still more. Such councils say that the Government's reduction of grants is to blame. My reply is that 67 per cent. or 100 per cent. increases cannot be entirely the result of the Government reducing grants. The answer lies substantially in the hands of the councils. I refer to their profligate spending, hugely subsidised public

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  transport and support for every lunatic fringe organisation, such as is the case in London. I refer also to hospitality for all types of marches and causes which happen to pass through centres of population. Those are the excesses that my right hon. Friend is trying to curb. Only a minority of authorities need to be curbed, but my right hon. Friend must have the relevant powers in case they should prove necessary.
  The tragedy is that authorities such as those I have mentioned are the cause of savings having to be found in other authorities, the spending of which is quite reasonable. That has involved a cut in capital allocations, because, if we spend too much on revenue, there must be cuts, and it is capital spending which must be reduced. Parliament has a duty to manage the economy. We cannot ignore that duty. If we do, we might as well go home. If some authorities insist on going over the top, the Government cannot stand idly by. That is why I support the Bill.
  Like many of my hon. Friends — and, I venture to suggest, hon. Gentlemen opposite — I receive letters almost daily from constituents who are groaning under the burden of excessive rate demands.
  Mr. Nellist: I have not received one.
  Mr. Alexander: Their message is, "Do something." I have passed that message on to my right hon. Friend. Many of my right hon. and hon. Friends have urged for years that something should be done. Many of them did so at the recent general election, but they are now unwilling to face the consequences of the legislation that we promised and are now presenting.
  Mr. Tony Banks: What about the promise to reduce taxes?
  Mr. Alexander: Nobody wants this legislation. I am sure that my right hon. Friend hopes that it will never have to be implemented. There are no easy answers in politics and we should not expect any. If there were, they would all have been tried before, the millenium would have arrived and we should all have gone home. Life is not like that. Right hon. and hon. Members know that unpalatable decision must sometimes be taken. I speak on behalf of hundreds of thousands of ratepayers in Nottinghamshire when I say that I support my right hon. Friend's proposals.
  It is argued that the Bill is a constitutional monstrosity. However, Parliament has a duty to manage the economy. All the powers of local authorities, including those to raise money by taxation, derive from the House. Local authorities have no powers but those granted to them by Parliament. That has been so for well over a century. Never before in that time have local authorities taxed their ratepayers without mercy and without regard to ability to pay, but they are doing so now. That is what the Bill is about and that is why something must be done.
  Only about 22 per cent. of local authorities' net expenditure is paid for by domestic ratepayers, so there is little democratic accountability. The Bill is an attack not on democracy but on the ability to levy swingeing rate increases without restraint on those who often have no power, through the ballot box, to do anything about it. Of those who do pay domestic rates and thus have a vote, 16
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  per cent., quite properly, get a rate rebate and a further 12 per cent. have their rates taken into account in supplementary benefit payments.
  The present system is a licence to tax without hindrance, in the knowledge that the majority of those who have a vote have little interest in the amount levied and that the tab will be picked up by those who have no vote. Those electors with no vote look to this place for relief. This is an attack not on local democracy but on entrenched local excesses.
  We should not be agonising over whether the local authority associations are against the proposal. They do not pay the rates. We should ask the ratepayers whether the Bill is necessary. That is the main test. Do the ratepayers want their local authorities to have the power of unrestrained taxation? The vast majority of ratepayers would say that they do not. For all their high-sounding titles and propaganda, the local authority associations have one inbuilt deficiency: they do not speak for the ratepayers.
  Forty-one companies took part in a CBI survey on rates in Nottinghamshire last month. They said that they had declared 3,500 redundancies since January 1982, and that high rates were a significant cause of 46 per cent. of those redundancies. They said that rates averaged £240 a year for each employee. That is the extent of the rates burden which Opposition Members try to minimise. Those surveyed said that a rates increase of 5 to 10 per cent. would affect future employment prospects in their companies.
  If we accept what those companies have said — I am sure that Labour Members have no reason to doubt it—
  Mr. Tony Banks: We have many reasons to doubt it, because it is misleading.
  Mr. Alexander: —Opposition Members should be arguing for the Bill because it would protect jobs if we could curb authorities such as Nottinghamshire. Rates have affected the level of business activity in my county. They have contributed to unemployment, which is already high.
  I started by saying that I was astonished that some of my hon. Friends opposed the Bill. I conclude my saying that if it is not passed, some electors will suffer dire consequences. Ratepayers in many areas need the Bill. They were promised it at the general election. I believe that they should have it, and I support it.
  8.5 pm
  Mrs. M. Beckett: Not only the local authority associations to which some hon. Members referred, but most of the authorities in the county of Derbyshire oppose the Bill. The authorities of west Derbyshire, High Peak and south Derbyshire all oppose it, as does the council in the city of Derby.
  There are two major reasons for the opposition voiced by those councils. First, there is no point in having local government that cannot make local decisions in the light of local circumstances. That is what local government is about and what it is for. That is what the Bill seeks to remove.
  Mr. Holt: Will the hon. Lady give way?
  Mrs. Beckett: Of course not.

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  The second major reason why the councils are opposed to the Bill is that they rebel against the phoney case that the Government and their supporters have sought to make in proposing the Bill.
  There have been several major causes for rate increases up and down the country in recent years. The first is the fall in the rate support grant—the money that the Government make available to assist local councils to meet their expenditure needs. The second is the increase in the burdens that the Government have imposed on local authorities — to which I was happy to hear some Conservative Members refer—such as the transfer of the administration of housing benefits and yet other burdens that will come in future as the Government seek to bring down their expenditure and pass the buck to someone else. The third cause for rate increases, to which there has been little reference, has come about through previous direct action by the Government with regard to local government. I refer to the penalties, under the Government's previous legislation, which have contributed to an increase in the rate burden.
  The Derbyshire county council has been castigated both by local Conservative Members of Parliament and by the Government as an overspending authority. Yet, without the Government-imposed penalties, the rates would be 35p in the pound less than they are, and the rate increase in recent years would be at or even slightly below the rate of inflation, although the services in Derbyshire have improved, as promised in the county council's manifesto, on which it was elected.
  However, Derbyshire is only one of many authorities—some Conservative-controlled—the spending needs of which, as assessed by the Government in their figures for grant-related expenditure, are above the target set for the rates that they should charge. In the coming year alone, the Government's assessment of Derbyshire's spending needs will rise by £16 million, but the target given will rise by only £5·4 million. The grant-related expenditure figure will be £12 million higher than the target for spending. Therefore, who is overspending and who is to judge by what amount or in what way the overspending is taking place?
  Most important of all, in the past week the Government's newly created quango, the Audit Commission, produced its survey of a family of 18 comparable authorities, of which Derbyshire is one. The Government's own body's survey shows that in Derbyshire current expenditure is below the average for that family of comparable authorities. It appears that in this case, as in so many others across the country, the criteria for overspending will be merely at the whim of the Secretary of State, not according to related financial facts.
  Apart from the county of Derbyshire, the Derby city council, on an all-party basis, has asked its Members of Parliament to oppose the Bill. The council's budget is in accordance with the Government's targets. Between 1978–79 and 1983–84 the city rate rose by only 29 per cent., whereas the retail price index rose by 73 per cent., and the Government's own spending—they are happy to criticise everyone else—rose by 78 per cent. However, because its rate-borne expenditure is more than £10 million, Derby, like many other councils, will fall within the scope of the Bill.
  How can the Secretary of State have the impertinence to claim that he and his civil servants can manage Derby better than its elected representatives? Their record meets
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  with no party criticism in the city. They are admirable and prudent, yet the Secretary of State will have the power to take the decisions out of their hands. I do not doubt that the Minister will claim that councils such as Derby wil1 not be affected, but the Derby city council does not believe that and neither do I. The council has written to say that it is united in opposing this legislation as an unwarranted interference in the constitutional relationship between the two levels of government.
  There seem to be two basic reasons why we cannot believe that councils such as Derby will not be affected in future. First, it is quite clear—as far as I can judge, no one in local government disagrees—that the selective scheme, if brought in for 1985–86, is bound to fail to meet its targets, because there is no way in which even a few authorities can be brought back to the Government's targets within their time scale. Therefore, the Government are bound to turn to their general powers.
  Secondly, we believe that those general powers will be used to reduce expenditure across the board in local councils throughout the country, whether they are managing their electorates' affairs well or otherwise. The explanatory and financial memorandum says that clause 2 will be used
  "having regard to general economic conditions",
  not the needs of local areas.
  There is no point in having local government if its assessment of local need is not allowed to differ from that of central Government. We might as well leave everything in the hands of central Government and abolish the structure of local government altogether. I fear that the Bill will be yet another weapon in the Government's war to destroy the welfare services that have been built up in this country, wherever they may be found, including at local level.
  For those reasons, I have no hesitation in following the wishes of local representatives of all parties in opposing the Bill.
  8.11 pm
  Mr. John Heddle (Mid-Staffordshire): At this stage of a debate it is incumbent on all hon. Members to endeavour to introduce original aspects. So many foxes have been shot, so many arguments deployed that it is important not simply to re-run those already put forward. I will not pursue all the points made by the hon. Member for Derby, South (Mrs. Beckett) but she referred to the fact that local authorities have had greater obligations imposed upon them by central Government. I could give the House a catalogue of duties lifted from the shoulders of local authorities — industrial development certificates and office development permits, to name but two. She failed to mention that under this Government local authorities now have a bounden duty to pursue the real policies of setting the people free by following a vigorous policy of sale of council houses and other surplus assets, thereby creating capital with which to provide for the programmes that the electorate and the ratepayers want.
  A debate of this nature would be enhanced if hon. Members of the Opposition, just some, actually admitted that some local authorities abuse the system, that some local authorities take the ratepayers to the cleaners and that some check, balance and control might in some circumstances be necessary. The hon. Member for Newcastle upon Tyne, East (Mr. Brown), who spoke before the hon. Lady, referred to the fact that rates

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  comprise just 1 per cent. of manufacturing industry's costs. He chose to ignore the fact, as have other hon. Members of the Opposition, that the rates element paid by manufacturing industry in the United Kingdom amounts to one eighth of the gross trading profits before tax—12·5 per cent.
  The hon. Member for Copeland (Dr. Cunningham) opened the debate for the Opposition. I sought to intervene twice at that point in his speech where he deplored the fact that central Government, by means of this Bill, were to impose their will on local authorities. Where was the hon. Member—where were other hon. Members—on the night of 4 February 1976 when enthusiastic support was given in the Aye Lobby to the Second Reading of the Education Bill, which compelled local education authorities to respond to the dictates of central Government in ensuring that every single school became comprehensive, notwithstanding the fact that the parents, the teachers, the friends, the governors and the pupils of those schools did not want this to happen? This is a complete U-turn in the philosophy of the party in opposition.
  My right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) advocated increasing the frequency of local government elections—one third every year in three or one quarter every year in four. I wholeheartedly agree with that. It is perhaps a pity that when his Government enacted the Local Government Act of 1972 he did not seek to incorporate such provision. He also said that, as far as he was aware, the Secretary of State had no power under the special powers provisions of the Bill to raise the threshold above £10 million. My reading of the Bill suggests to me that clause 2 gives my right hon. Friend the Secretary of State that power. That I believe to be absolutely right.
  I agree with my right hon. Friend the Member for Old Bexley and Sidcup when he says, as I have said on a number of occasions, that it is possibly not realised by some Members of this House—and certainly not by others outside—that there is a direct relationship and also a direct contradiction in the way local government raises its money and the way in which the money is spent. Neither side of that particular balance sheet can be dealt with in isolation. They must be dealt with together. I welcome my right hon. Friend's suggestion that there should be, as part of the continuing grant/rate debate, at least some appreciation of the interface between these two things.
  I will support this Bill in the Division Lobby tonight. I have my reservations because in many ways it is a sad Bill because of the failure of all political parties, local authority organisations, professional institutions and trade bodies to reach a consensus on what to do about the rates. We have all sought to make political capital out of expressing sympathy for the poor hard-pressed ratepayer. Have we acted responsibly as a House in coming forward with a view that would command respect and cease to tempt the abuse of local government? What we are seeing now is a product of the lack of consensus on an alternative to the present system. No uniform view exists about the perceptibility of local income tax, the equity of a poll tax or the reliability of a local sales tax. It is the product of a desire on the part of all political parties when in government to fudge the short-term issue in the hope that
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  it will go away. I deplore the behaviour of both the last Labour Government, and so far of my own party in government, in fudging the issue of a rate revaluation.
  I hope that my hon. Friend the Under-Secretary of State, in his wind-up speech tonight, will give me some assurance that at least the Government intend during the lifetime of this Parliament to embark first on a commercial rating revaluation and then on a residential revaluation to eliminate the anomalies and distortions in the present system.
  As my right hon. and learned Friend the Member for Hexham (Mr. Rippon) said in a very thoughtful speech—though I did not agree with his conclusions—for years there was a consensus and a convention that local authorities in general followed the wishes of central Government as regards the total level of expenditure. However, that convention has been broken in a number of well publicised instances, and I believe that it is the Government's bounden duty to respond to the changed situation and circumstances and to protect the ratepayer.
  As local government has become more political—some of us would perhaps prefer it not to be so—some councils have abused the trust that central Government placed in them and have levied rates of such iniquitious and horrendous proportions, particularly on industry and commerce, that companies have gone bankrupt and their employees have joined the dole queue.
  Local government is big business. It accounts for 25 per cent. of all public expenditure, and it employs one person in 10 throughout the country. Like all businesses, it has a threefold duty: first, to spend the money that its bankers invest in it wisely; secondly, to produce goods or services that reflect value for money; and thirdly, to produce a reasonable return for the shareholder. When any of those three criteria is not met, I believe that the banker, the customer or the shareholder has a right to be heard. In the context of local government and rates, the voice of the shareholder — the ratepayer — goes unheard, by and large. The turnout at local elections is pathetically low. As we heard, it is 20 per cent. or 30 per cent. and historically the voter will vote not on the behaviour or prudence of his or her local authority but on the behaviour at the time and the popularity of the Government in power in this place.
  This Bill provides a measure of protection—some say a crude measure of protection, but it is at least a measure of protection—for the banker and shareholder, in the form of specific and general powers. I hope that the specific powers can be seen to work, but I have deep reservations about the desirability and practicability of the general powers. However, I fail to see how the Bill can be attacked in the name of democracy. Is it not a strengthening of democracy that councils should be forced to be more accountable? Is it not a strengthening of democracy that greater rights be conferred on the payer of the piper? However, I fear that the right of consultation for industry and commerce in clause 13 is no more than a paper tiger, and will not do much to enhance the rights of the industrial and commercial ratepayer when being consulted by a potentially hostile local authority.
  How strong, in fact, is the constitutional argument, when the reality is that with so many of the functions devolved upon it, local government acts merely as a convenient agent of central Government? How strong, in fact, is the constitutional argument when more than half the money that councils spend comes from Whitehall or elsewhere, and over 60 per cent. of the remainder comes

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  from the industrial and commercial ratepayer who has no voice, no vote, no say and no sanction in the way that the money is spent?
  In February of this year, I committed an act of parliamentary vandalism by helping to strip the roof off a factory in Wolverhampton to enable the owners of the factory to avoid paying empty rates. After all, those owners were doing their best. They employed local labour in the construction industry, and let the factory to a company to provide employment in Wolverhampton which had to pay £26,000 for services that it was not receiving. I am glad that the Bill provides protection for the industrial and commercial ratepayer against the payment of void rates.
  I end with a plea to my right hon. Friend that he extends the void rating exemption beyond industrial property—I understand that his Department is consulting interested organisations and bodies—and across the commercial sector. How many owners of office blocks are told by local authorities that they must let those office blocks to firms within the borough? They have no right so to do, if the owners of the premises wish to let them to provide employment from outside the borough. I hope, therefore, that my right hon. Friend will consider carefully the whole subject of void rating, and look at it from the point of view of the ratepayer, who is being taxed for property that he is not occupying and being made to pay for services that he is not receiving.
  With those reservations, I welcome the Bill, at least as an attempt to ensure that the quiet voice of the ratepayer is heard the more effectively.
  Mr. Deputy Speaker (Mr. Paul Dean): Order. Before I call the next hon. Member it might be helpful if I inform the House that the wind-up speeches are expected to begin at 9 o'clock. There are still many hon. Members on both sides wishing to speak. Short speeches will mean fewer hon. Members being disappointed.
  8.25 pm
  Mr. Frank Dobson: My hon. Friend the Member for Hackney, South and Shoreditch (Mr. Sedgemore) referred to the problems that this Bill, if passed and implemented, will impose on people who live in Hackney; and similar problems will arise for other people living in most of the deprived areas of Greater London. If one looks at the hit list of authorities—those that the Government intend to attack in this measure—one sees that a large proportion of them are in London. The most spectacular example is the Inner London Education Authority. I propose to confine my remarks this evening to the problems of that authority.
  I take as my text a speech that was made by the Secretary of State for Education and Science in Sheffield on Friday, 6 January of this year, when he said:
  "I am myself ready to acknowledge that I underestimated the task which we face in raising standards in schools when I took up my office in 1981. In particular, I did not at that time fully appreciate, for example, the problems of teaching low attainers and the special difficulties faced by teachers in many inner city schools."
  The Inner London Education Authority is responsible for providing the education service for the inner city part of London. The problems that the authority faces are far greater than the problems faced by any other education authority in the country. Some areas of the country may have a higher proportion of people who are unemployed,
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  but not many. Some areas of the country may have a higher proportion of children whose mother tongue is not English—but not many. There are no fewer than 50,000 children in ILEA schools—50,000 out of 300,000—whose mother tongue is not English. At heart, they are not a problem. Indeed, it would be useful to our country to have 50,000 fluent in other languages, provided that those children in the meantime became fluent in English as well. So ILEA has a large task in turning that characteristic into an asset to the country.
  Some other areas may have a higher proportion of children in single parent families — but not many. Indeed, ILEA has 14 per cent. of its children come from single parent families. Some areas may have a higher proportion of people who live in abject poverty, although I doubt it. However, none has the same combination of problems of multiple deprivation affecting the population, and consequently the education service, of inner London.
  The combination of stresses is quite unique. It is reflected in the Government's own figures, calculated by the Department of the Environment. It came up with what were called "Z" scores of multiple deprivation in local authority areas. Out of the 10 authorities with the highest "Z" scores, no fewer than seven are inner London borough areas, and all 10 are from Greater London. Indeed, the inner London average deprivation, according to the DoE's figures, is considerably worse than that of any authority outside London. Hackney has the highest score with 6·69. The inner London average is 4·36. The next worst authority, outside London, is Manchester, with 4·19. Liverpool—goodness knows Liverpool's problems are legion and known to everyone—comes out at 3·51, which is much lower than the inner London average.
  In the face of this, ILEA is trying to do a job of work. For this purpose it gets not a penny from the Government towards its day-to-day running costs. All its running costs are met by inner London ratepayers, yet what is its record compared with other authorities in the rest of the country? Her Majesty's inspectors of schools, still, under this centralising Government, independent, have in the past three years produced annual reports on the standards of educational provision in the whole country. There are 96 education authorities and never in the past three years have more than five or six authorities been satisfactory in every aspect that Her Majesty's inspectors look into, but ILEA has been among that five or six on every occasion.
  ILEA is not perfect. As a parent of children who go to ILEA schools, I know as well as many other parents that considerable improvements need to be made. One of our objections to everything that is going on, and the continuing attack by the Government on the education authority, is the extent to which the good will, effort, expertise and energy of countless people in inner London, instead of being devoted, as most parents, teachers and education authority administrators would want, to improving education standards in inner London schools, have been diverted into trying to protect the education authority from the depradations of the Government year in, year out. That is a great loss.
  The Government say that it costs a lot to provide an education service in inner London, and it does, but it was ever thus. It has always cost much more to provide an education service in London than in any other part of the country. As long ago as 1878, when Matthew Arnold, better known as a poet, was Her Majesty's chief inspector of schools, it cost 50 per cent. more to educate a child

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  under the London school board than the national average school board cost. Why does it cost more? It is because the cost of everything in London is higher and because ILEA is trying harder than any other authority to cope with the problems that it faces and to give all the children a good start in life.
  The ILEA scheme for the use of computers in all schools was so well approved by the Department of Education and Science that it was adopted nationally and the eclair French teaching scheme and the Smile mathematics scheme have been taken up by legions of authorities in other parts of the country. It pioneered bringing in parent governors, now apparently so dear to the hearts of Tory Ministers. It pioneered graded testing, which the Secretary of State was lauding and proposing for every other authority in the speech that I quoted earlier. All these services, improvements and attempted improvements cost money. Everything in London costs more than it costs elsewhere. If the House were to be removed to Yorkshire or Northumberland, the cost of providing its services would be substantially reduced.
  There is another local service in London. It has more than 20,000 staff and its cost per member of staff is 40 per cent. more than the average cost in the rest of the country, and on the standard of performance set by the Government Department responsible for it, it is twice as inefficient as the next most inefficient equivalent organisation. There might be a case for rate capping that organisation or bringing it under the control of the Secretary of State for the Environment, but if he tried to do so he might be in trouble because the Home Secretary is responsible for it—it is called the Metropolitan police. I use that as just one example. The disparity between the cost of the Metropolitan police and the police service in the rest of the country is roughly the same as the disparity between the cost of ILEA and of the education service in other parts of the country.
  I do not suppose that the Secretary of State will do anything about that, but he proposes to do something about the costs of ILEA. If he does, the additional facilities that ILEA tries to provide in all its schools will disappear, the extra teachers will be reduced, the 35p school meals will probably be doubled in price, and the generous clothing allowance for the poorest children will disappear, as it has disappeared in skinflint Tory authorities all over the land. The provision for poor children to go on school trips and holidays and journeys will go. As seen by mandarins in Whitehall and the Treasury Bench, these are trivia. The combined salaries of the Ministers on the Government Front Bench earlier would have paid a decent rate support grant for a number of authorities.
  The nursery services in ILEA, which are more extensive than any other, will be threatened. Some parts of the country, under the Government's present loony system, get grants for a nursery education system that they do not provide, but ILEA, which provides the largest system, gets no contribution from the Government. There is more adult education provision in London than anywhere else. It is so successful that Members representing the outer London Tory boroughs, if they were here, would have to confirm that legions of their inhabitants are ever eager to come into adult education classes provided by ILEA because the skinflint Tories will not do it. Such people do not all come for flower
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  arranging. Adult education has a vital role to play in combating illiteracy and ignorance. I shall read a letter that will be more eloquent than anything that I can say. [Interruption.] The hon. Member for Northampton, North (Mr. Marlow) should keep quiet, and at least pay some respect to the person who wrote me this letter, even if he holds me in no respect. The letter is written by Mr. James Doyle of 6 Hazle house, Maitland Park road, NW3, in my constituency. This is not a form letter, whatever anyone may say. It says:
  "Dear Sir, I have come to school for 4 years to Camden Institute. I come to the classes because I wanted to learn to read and write. I feel that I'm learning well and don't want the classes to end. So, as my M. P., I would like you to make sure that there will be not cuts in I.L.E.A. and classes will not be affected or teachers' jobs lost."
  The Secretary of State seems to wish to speak. I challenge him now, and I shall give way, to give a promise that Mr. Doyle's classes will continue after this Bill has gone through, and if the Secretary of State will not promise that, will he keep his stupid mouth shut?
  Mr. Marlow rose—
  Mr. Nellist: We want the organ grinder not the monkey.
  Mr. Dobson: The Bill proposes catastrophic reductions in the level of expenditure by ILEA. Government members are in a curious position on this matter because most of them do not send their children to schools in the state system anyway. They make no contribution to ILEA's costs. I do not know what status the Government have in a debate about ILEA's future. I believe that my children are precious, and most people believe that their children are precious. We should have a decent society in which we all hold everyone's children precious. All the children in inner London, whatever their ethnic background, however poor their families may be, whether they are in Hampstead, Highgate, Blackheath or Hackney, should have as good an opportunity in life and as good a basic education as those children in the schools to which rich members of this Cabinet send their children because they do not think that inner London schools are good enough. If they do not think that inner London schools are good enough for their children why are they trying to reduce the money spent on the schools and so make them worse?
  I give the Government this warning: the people of inner London treasure their education service which they have had for well over 100 years, and they will not give it up. They will fight like the devil at every stage during the passage of this legislation and afterwards. They will wreak a terrible vengence on any party that destroys their children's educational opportunities.
  In the age of videos we should always remember that there is no action replay of childhood. We get only one childhood. If we do not provide a decent education during the childhood of our children there will be no second chance. They will not see themselves as part of our society. I warn the Government that the people of inner London will not accept sweeping, smashing reductions in the expenditure of the ILEA. The Government have no mandate from the people of inner London to do so. The Government contribute nothing towards the education service in inner London. The people of inner London pay for that service. It is not in the Government's hands to destroy that for which they do not pay.
  8.41 pm
  Mr. W. Benyon: My hon. Friend the Member for Manchester, Withington (Mr. Silvester) will probably say that I take too romantic a view of local government, but I make no secret of my strong opposition to this measure. This is a sad day for those of us who feel strongly about the independence and importance of local government.
  I accept what my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) said about Camden council. As a ratepayer in the London borough of Hackney, I am equally worried. If we are to have local government, we must take it warts and all. We cannot just have cosy Tory councils and get rid of or control the rest. We might just as well carry the logic of the argument to its proper conclusion, get rid of local government entirely and put in a commissioner. That is the role that all authoritarian regimes have taken.
  There is an inevitable progression in this matter which started in the 1960s and 1970s when the Labour party tried to force comprehensive education on local authorities. It would he invidious to quote the passionate speeches made by Conservative Members during the debates on those measures. They were followed by the Housing Finance Act 1972, during the Administration of my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath). The only significance of that was the Clay Cross incident when a very Left-wing Labour council broke the law. I believe that that incident had an effect out of all proportion on my colleagues in the Conservative party. They came to the conclusion that we would never achieve co-operation on a matter of important official policy, and, therefore, the basis of mutual trust and respect which had governed relations between central and local government was gravely undermined.
  When the present Administration came to power and wanted to sell council houses, they made certain that the legislation forced local authorities to adopt that policy even though their electorates, apparently, did not want it. Therefore, the slope towards centralisation became steeper and more slippery. That process culminated at the end of the last Parliament in the Local Authorities (Expenditure Powers) Act 1983. Hon. Members will remember that that legislation originally sought to limit the rate-raising powers of local authorities. Eventually, the Government changed their view and that part of the Bill was removed.
  The Secretary of State at the time was very specific in his assurances. I thought then that the argument had been won, but, out of the blue, we had this particular proposal in the Conservative party's election manifesto. As far as I know, that proposal had not received detailed and careful discussion—certainly not in the parliamentary party. We now find ourselves putting into law a measure to implement that promise. I do not believe that we should do so. I take the point of my hon. Friend the Member for Hampstead and Highgate that manifestos are dangerous documents, as the Labour party discovered when dealing with devolution.
  Disraeli wrote:
  "I cannot force from my mind the conviction that a House of Commons concentrating in itself the whole power of the State might establish in this country despotism of the most formidable and dangerous character".
  Disraeli was talking about the checks and balances in the constitution. What would he think today when the monarch and the House of Lords exercise less power than
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  they did in those days? Lord Salisbury was Prime Minister when the Local Government Act 1888 was passed. At the moment, that legislation governs the relationship between central and local government. It enshrined the principle that went back to the 1600s. I shall not quote what he said because the hon. Member for Blackburn (Mr. Straw) quoted him in his article in the Daily Telegraph. Lord Salisbury referred to the excessive and exaggerated powers which have been heaped on the central authorities in London. What would he think today? If the powers were excessive and exaggerated then, what are they now?
  I leave it to others to argue whether the Bill will or will not control local government expenditure. For me, the Bill essentially means a measure of centralisation. The Conservative party in particular must ask itself where the legislation will lead us. First, the Bill gives substantial power to the Secretary of State, and that power does not stop at fixing the rates. It goes into the details of the local authorities concerned because that will be debated on the Floor of the House. The Bill sets a precedent that would be dangerous if the Secretary of State came from a Government of a different persuasion.
  Secondly, the Bill leads inexorably to further erosion of the status of local government. Electors will not seek their remedies locally, but will petition central Government where the power patently lies.
  Thirdly, the Bill will encourage irresponsibility. There will be no need to take the onus of difficult, dangerous and unpleasant decisions. The villain will be there for all to see.
  It used to be fashionable for Tory speakers to quote Burke. Recently he has been out of favour, and one can understand why. When he was talking about the French monarchy, he described its leading vice as
  "a restless desire of governing too much."
  He went on to say:
  "as always happens in this kind of officious universal interference, what began in odious power, ended always, I may say without exception, in contemptible imbecility."
  Hitherto, the Conservative party has been the implacable opponent of centralised state power, and it should stay that way.
  8.47 pm
  Mr. William O'Brien: After listening to Government Members I find that the Government's argument for the Bill is that it is a necessary economic measure. The truth is that this year's overspend—as interpreted by Government speakers — by local government amounts to a meagre 0·6 per cent. of total public expenditure, and that is measured against a unilateral target set by the Government.
  This kind of local spending, which is providing local services, can hardly be jeopardising our economic recovery. In real terms, local government spending has grown less than that in the rest of the e conomy and less than central Government spending. There is no sound economic justification for rate capping. The truth is that this Government—the most reactionary one in history for their actions towards local government — are covering up their increased spending on defence and the dole; they are shifting the cost onto rates by withdrawing rate support grant from councils. The rating system is out of date, and we should be introducing other ways of financing local government.
  This afternoon, we have heard a great deal of comment about keeping election promises. In 1974, the present

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  Prime Minister promised to abolish domestic rates. Domestic rates take a higher proportion of income from poorer households than from richer households. I am a firm supporter not of total abolition of rates but of supplementary help. When the Tories came to power in 1979 they again said that they intended to reform the rating system, but again they went back on their promises to the ratepayers of this country. Because they cannot carry out their manifesto promises, they have decided to make unwarranted and vicious attacks on local government.
  The Tory-controlled Association of County Councils—the Government's own supporters and front-line troops—says in its report on rates:
  "The Association understands the Government's concern about a handful of local Authorities which have not operated within national economic and social policies, but nevertheless, even if there were no other way of tackling the problem of those few authorities, the implementation of the Government's proposals appears to be based on expediency and would result in an unacceptable centralisation of power in practice in the hands of the Executive, rather than of Parliament and a further weakening of local democratic control.
  The price to be paid is too high, for a problem which is overstated and can be reduced by further improvements to the system of local taxation to make Local Authorities more accountable to their electorate and taxpayers".
  That appeal from the Government's own supporters is echoed by the great majority of people who serve in local government. The Secretary of State is seeking executive powers to act against authorities whose expenditure is considered excessive but he will give no indication of how he defines "excessive".
  The Bill as presented is not about rates. It is designed to give the Secretary of State more and more power over local government. It should be called the Direct Rule Bill — direct rule over communities and councils and democratically elected councillors not by Parliament but from No. 2 Marsham street. Clause 1 gives the Secretary of State power to prescribe a maximum rate to be levied and clause 2 allows him to designate the authorities for which he will prescribe a maximum. Even the £10 million maximum put into the Bill to appease the Tory district councils is not secure. Conservative Members who represent smaller district council areas should be aware of the dangers in the powers sought by the Secretary of State. The £10 million maximum can be changed and non-metropolitan districts are included in the classes for which the Secretary of State seeks power to set a maximum.
  Clause 3 enables the Secretary of State to determine the total expenditure of an authority without regard to the needs of the authority. Clauses 4 to 7 and the rest of the Bill also seek to introduce direct rule by central Government. The essence of the Bill is a threat to the basis of democracy in this country. The Secretary of State and his officials say that they should set expenditure levels for local government but they do not explain how the levels will be decided. The problems of defining reasonable and appropriate levels of expenditure for individual authorities have bedevilled local government finance in recent years and the Department of the Environment has had substantial experience of those problems but has been unable to find equitable solutions. The difficulty of defining appropriate spending levels for block grant determination highlights the problems involved. Under the Bill, the Secretary of State will be able to determine expenditure levels for individual authorities, to make judgments on appeals
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  against his own decisions and to lay down undefined conditions for a temporary relaxation of any decision. In other words, he will be both judge and jury for local government.
  The Government are pressing for the Bill to become law to provide greater control over local government when what is really required is reform of local government finance. The Government's real failure in respect of local government accountability is their failure to implement the proposals in the Layfield report in relation to some form of local income tax or to accept the consequences outlined in that report. The Government's conclusions on the responses to their Green Paper on the reform of domestic rates represent another lost opportunity. Every hon. Member is aware of the problems and difficulties facing local government due to the outdated system of local government finance and this Parliament should be working to reform local government finance.
  I appeal to the Secretary of State and to the House to reject the Bill because it is a direct and vicious attack on local government.
  8.56 pm
  Mr. Richard Needham: I have four minutes before the latter-day Lord Salisbury addresses the House.
  As part-owner and founder of a small factory, I know that rates are a crucially important part although not the most important part of a small business's costs. Rental costs in a factory such as mine are £2 per sq ft and the rates are equivalent to 60p per sq ft. It is therefore vital that anything that can be done to reduce the rate burden should be done. I am lucky in that my factory is an area in which the local authority is reasonable and I do not for a moment mind paying the rates, but my views are borne out by the experience of others in other areas.
  In 1978 rents and rates in London were double those in East Anglia. Between 1965 and 1979 East Anglia increased its share of manufacturing employment from 6·9 per cent. to 8·8 percent., with an increase of 140,000 jobs. Inner London, however, lost 240,000 manufacturing jobs between 1966 and 1976. Moreover, between 1966 and 1971 there was an exodus of 301 companies and only 17 moved into inner London. Rates, of course, are not everything, but they must have been a significant factor in those figures. To argue, therefore, that the Government should not take powers to stop an excess of rate spending—and I have listened to a great number of speeches today by those who are spenders rather than earners—seems to me to be ridiculous.
  The final point I make to the House is this. For a community to survive, it has to have diversity. That diversity can exist only if there are rich people, not so rich people, small businesses, big businesses—
  Mr. Nellist: Rubbish.
  Mr. Needham: That is right, and if I am rich, then I have earned it myself and not off the backs of others. If that is the case, it is crucial that the people who have to pay taxes are not so exorbitantly taxed that they have to move out.
  It is for that reason if no other, to maintain the importance of communities, that the Government are right to make sure now that they have power to do something because one cannot constantly wait for new ideas, new

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  reforms, many of which have been discussed at length, to come forward on to the statute book. That is why the Government have to ensure that the rates where they are in excess are properly controlled.
  Mr. Ioan Evans: On a point of order, Mr. Deputy Speaker. A number of hon. Members on both sides of the House have sought to get into the debate to express the anxieties of their constituents and of the local authorities, both the county councils and the district councils. I put it to you, Mr. Deputy Speaker that, because this is a change in the constitutional relationship between local and central government, the Bill must be taken on the Floor of the House and not upstairs in Committee.
  The Deputy Speaker: The hon. Gentleman is an experienced parliamentarian. He knows that that decision can be made later, after the Second Reading of the Bill.
  9 pm
  Mr. Jack Straw: In winding up for the Opposition tonight, I first congratulate the hon. Member for Basildon (Mr. Amess) on a spirited, if a slightly controversial, maiden speech, and I am sure that the electors of Basildon will look forward to further details of the proposals for a poll tax that he has put forward.
  The debate has been remarkable in two respects. It has been remarkable for the strength of opposition to the measure on both sides of the House. So far as the Conservative Party is concerned, that opposition, as we have heard from speeches today—and as we would have heard from many speeches that have not been given because hon. Gentlemen such as the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) were not able to catch your eye, Mr. Speaker—is not confined to one wing of that party, but is spread across it. The debate has been remarkable also for the way in which some of the supporters of the measure have let their masks slip, and they have produced crude, anti-democratic arguments, as the hon. Member for Hampstead and Highgate (Mr. Finsberg) did, in which the voters of Camden, Sheffield and Islington were abused for no other crime than that they have consistently voted in Labour councillors. Indeed, in that speech the very right to vote of those people who do not have to pay rates was challenged.
  Central to the argument for the Bill is the Government's concern to hold down the overall level of public spending. As my hon. Friend the Member for Copeland (Dr. Cunningham) made clear in his commanding speech, the claim that local authorities have overspent is a most staggering impertinence by the Government for, on almost any measure, local government's record of efficiency, expenditure and service is better than that of central Government and the Prime Minister.
  As we heard, since 1978–79 central Government expenditure has risen as a share of national income while local government's share has fallen. So arbitrary and unjust has the Government's selection of overspenders been that of the top 40 whose budgets this year are already above their targets for next year, 26 of those alleged overspenders have increased their spending by less than the Prime Minister has increased that of central Government. Twelve of these authorities have increased their spending by less than the average of local authorities. Rochdale, Tameside, Walsall, Lewisham, Tower Hamlets, Haringey, Avon, Cheshire, Cleveland,
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  Derbyshire, Humberside and Lancashire, all on the hit list, have increased their spending by less than the average. Fourteen of these authorities have increased their spending by less than the rise in pay and prices which means that they are being hit despite the fact that they have had to make real cuts in their spending over the past four years—Liverpool, St. Helens, Gateshead, north Tyneside, south Tyneside, Hounslow, Cumbria, Durham, Northumberland, Newcastle upon Tyne, Salford, Manchester and Richmond-upon-Thames. The example of Newcastle upon Tyne which was quoted by the Secretary of State speaks eloquently of the humbug of the Government on the issue of rate increases. It is, indeed, true, that Newcastle's rates have increased by 130 per cent. over the last four years, but Newcastle's spending has increased by only 70 per cent. The reason why Newcastle's rates have gone up so much is not because of the ratepayers or the electors of Newcastle but because of central Government. The Government are principally responsible for the mass rise in rates that has taken place in almost every area of the country.
  However visible they may be, and despite the increases that have taken place, rates are but a small burden compared with the burden of central taxation imposed on the British people by the present Government. Rate bills for the average family have risen from £3·07 to £6·50 a week since 1978–79, but the same family has seen its centrally imposed taxation bill rise from £38 to £75, 13 times the size of its rate bills. We should tonight be talking not about rate capping but about tax capping, for no local authority of whatever political hue has broken its promises on spending and taxation as abjectly as the Conservatives. They promised to reduce taxation in 1979 and again in 1983. Instead, they have increased the overall burden of taxation by 14p in the pound, and today we learn that the increases in taxation last year were the highest of any western country.
  As for business rates, the Government have had to resort to the wildest exaggerations to justify the Bill. As the Under-Secretary told me, rates form just one hundredth, 1 per cent., of business costs, a figure that has barely moved in the past.
  Moreover, unlike domestic ratepayers—this point has not been mentioned in the debate—business ratepayers obtain tax relief on their rate bills of 52p in the pound. No wonder corporation tax has gone down as rate bills have gone up. For all the false propaganda from the Secretary of State and his lickspittles in the CBI, the burden of business taxation including rates in the United Kingdom is low, to quote from the latest report of the influential and respected Institute for Fiscal Studies.
  International comparison can also show what nonsense is the Government's argument that the whole of their economic strategy could be knocked off course by the spending decisions of local authorities. No western country controls its local authority spending in the way in which this Government are proposing. Indeed, the only parallels for this measure are to be found in the Soviet bloc, and I ask Conservative Members whether that is the example they wish to follow. In most other western countries, including those whose record of economic success is better than ours, the totals of local authority spending are not even included, let alone controlled, in their public expenditure plans.
  Additional expenditure by local authorities that is borne on the rates cannot in any significant way affect the level

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  of borrowing, the level of interest rates or the level of the money supply. If the Government do not already know that the alleged overspending cannot and will not affect their overall economic strategy, they will soon find out, for what takes the Bill into the stratosphere of absurdity is the fact that it cannot in any event work to produce the savings that the Secretary of State claims for it.
  The argument today has been about £770 million—0·5 per cent. of public spending, 0·25 per cent. of national income—and as the director of the Chartered Institute of Public Finance and Accountancy pointed out yesterday, there is no way in the world that the Government can get back that sum or anything like it through the Bill. To do so would, for example, from the point of view of the GLC, require a London Transport fares increase in real terms of 40 per cent. But the Secretary of State for Transport, who is now assuming responsibility for London Transport fares, has said that fares will not rise above the level of inflation. If so, the Treasury will not get its cut. To claw back this £770 million would require the hit list authorities— for example Islington, but it is true of all the others—to close nearly all their libraries, old people's homes, day care centres and baths and cancel their home helps, which would be impossible.
  Dr. McDonald: Essex county council — a Tory-controlled authority—is bound either to overspend in the next financial year by £6·5 million or to cut essential services such as the police and the fire service, in spite of traditional Tory promises. Most of the Essex Tory Members signed a letter of protest to the Secretary of State, yet hardly any of them have been present tonight and no doubt none of them will have the courage to vote in the Lobby against the Bill.
  Mr. Straw: I am grateful to my hon. Friend. The Bill will certainly hit Conservative as well as Labour authorities.
  On 3 January, the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) told The Birmingham Post:
  "The pressure on backbenchers"—
  to vote for the Bill—
  "is quite extraordinary. If all those offered the prospect of office in the near future were to receive it, there would be no backbenchers left."
  The hon. Member for Aldershot (Mr. Critchley) has said:
  "Dark-brown voices"—
  of the Whips—
  "have been busy,"
  on the telephone, directing Conservative Members into the Aye Lobby.
  While the Secretary of State has been threatening petulantly, or promising, to resign if the Bill is rejected, he has already been preparing for defeat. Under the headline
  "Rate Bill may cost Treasury £500m",
  the Financial Times tells us that the Secretary of State is already preparing to go to the Cabinet and ask them to legitimise at least £500 million of the alleged £770 million overspend, because he knows that it is impossible under his present measures, or future measures, to claw back that sum.
  Apart from the sheer size of the cuts required from individual local authorities, there is another reason why the Bill will not work and will simply result in the most monumental bungle that the House has ever seen. In place
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  of local democracy and the collective judgment of 24,000 councillors and 400 local councils, it sets the judgment of the Secretary of State for the Environment. In practice, as the Conservative-controlled Association of County Councils has told us, effective control will be by the civil servants. The civil servants will be controlled in turn by the computer at the Department of the Environment and the calculation of each authority's grant-related expenditure assessment.
  Mr. Marlow: Will the hon. Gentleman give way?
  Mr. Straw: No, I will not.
  GREAs are horrendously complicated and it is not surprising that many hon. Members and Ministers should have found better things to do than grasp the details. However, the report presented to the House by the Secretary of State on 14 December shows that GREAs are based upon 54 different sets of compound mathematical factors which, added together, determine an authority's level of spending.
  Mr. Marlow: Will the hon. Gentleman give way?
  Mr. Straw: I will give way in a moment.
  With the events in Liverpool in mind, we are all concerned about how social service departments treat children — particularly young children — at risk. At present—in Redbridge, in Bristol and across the country—individual councillors use their skill and judgment to assess the level of services to be provided to children under five who are at risk. Under the Bill—I have to tell Conservative Members that I mean part I as well as part II — the judgment of those councillors will be subordinated to the calculations of the grant-related expenditure assessment factor XI.
  The computer will determine how much will be spent on children at risk not by making a careful study in each area but by multiplying the number who live in households lacking the exclusive use of a bath or inside WC by 0·04761 and adding the number who live in households containing a lone parent family, multiplied by 0·54864, and the number who live in households with an immigrant head, multiplied by 0·029293. Can that be the right way to make judgments about children at risk and the services with which they should be provided? That is exactly what the House is being invited to do tonight.
  What makes the measure even worse is that by seeking to use GREAs to control the overall level of spending by local authorities, the Secretary of State is breaking solemn undertakings given to the House by his predecessor, that the GREAs would never be used in that way. My hon. Friend the Member for Wolverhampton, North-East (Mrs. Short) reminded the House of that this afternoon.
  Mr. William Ross: Before the hon. Gentleman moves too far from councillors' judgment, will he recall that one hon. Member called the Bill an introduction of direct rule? Is the hon. Gentleman aware that we have lived under direct rule for many years in Northern Ireland where the Government are directly responsible for most local government functions, and that under that system there is great frustration? [Interruption.]
  Mr. Straw: I take the hon. Gentleman's point, and although the circumstances are different, we should all be aware of where the taking of central powers can lead and what has already happened in Northern Ireland.
  Mr. Marlow: The hon. Gentleman is one of the more sensible souls on the Opposition Benches. He will realise that many ratepayers are being devastated by the massive rate increases that they are having to pay as a result of some of his more loony friends. Will he tell the House whether he believes that a local authority should have an unlimited discretion about the level of rates that it charges?
  Mr. Straw: I would ask the hon. Gentleman to avoid flattering me, because it can do my future no end of harm. Yes, I do. I believe, as his hon. Friend the Member for Milton Keynes (Mr. Benyon) said, that we should accept local government, warts and all. I also believe—he happens to live in Lambeth, as I do—that the level of rates is not significantly high and that we receive good services for them. He and I may disagree over that and make different decisions when we vote, as can the electors.
  Since GREAs were established, the system has been so manipulated by the Secretary of State that inner urban areas, particularly Labour-controlled ones, have been hit exceptionally hard. Whatever criteria are chosen have to be applied to all authorities in a particular class. Therefore the system has had a random and capricious effect upon Conservative-controlled local authorities as well. That is one reason why ratepayers in Hove, Portsmouth, Gillingham, Wandsworth, Kensington and Chelsea, and Essex face rate rises of 40 per cent. or more, or major cuts in their services, if they are to keep to the Government targets. It is why the Conservative leaders of the local authority associations remain wholly unconvinced by the reassurances that the Secretary of State has sought to give. They know that the system is unfair and unworkable from their experience the past four years.
  In 1979, the present Leader of the House said:
  "Once you centralise power, a bad decision is disastrous".
  Nothing so eloquently proves the wisdom of his advice than the chaos of the system of grants and penalties on whose crumbling foundation the Bill is based.
  Some hon. Members have sought reassurance from the fact that the Government say that they will only use reserve powers if the selective powers fail. The Conservative leaders of the local authority associations have not been taken in by those so-called reassurances, and neither should Conservative Members. Mr. John Lovill, the chairman of the Association of County Councils, has said that the selective powers were in any event pretty pernicious because even to exercise the selective powers the Department of the Environment and the Secretary of State have to make a judgment about every authority.
  It may not be realised by Conservative Members who support the selective powers that if they work and reduce the rates of the so-called overspending authorities, they will then qualify for the extra rate support grant which they are presently denied. As the total rate support grant is fixed as a cash limit, it will mean that if rate capping works there will be less rate support grant for those authorities that have not been selected for rate capping and their rates will rise faster than they would otherwise have done.
  To add to the insanity, Mr. Noel Hepworth, the director of CIPFA—the Chartered Institute of Public Finance and Accountancy—said yesterday:
  "Given a relatively continuous list of levels of overspending, all overspending authorities may need to be capped to avoid uncapped authorities being allowed to overspend more than capped ones."
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  It is all very well saying that 20 authorities must be capped, but if those authorities are capped and another 10 are behind them, the 10 uncapped authorities will have higher rates than the 20 capped authorities. Therefore, the uncapped authorities will have to be capped. In those circumstances, 30 local authorities will be capped and another 10 authorities will be behind them. Their rates will be higher than those of the 30 capped local authorities and so the following 10 local authorities will have to be capped, and that state of affairs will continue. No Conservative Members should take reassurance from the syrupy words of the Secretary of State for he will be down the neck of every local authority in the land.
  To all of this, the Secretary of State has but one refrain—the Government have a mandate. Of course, what appears in party manifestos should be taken seriously. but while Governments may propose, it is for the House to dispose. A claimed mandate is no excuse for Members suspending their judgment on what is put before them. We know, not least from the words of the right hon. Member for Daventry (Mr. Prentice), that this manifesto commitment was never properly considered by the Government. The hon. Member for Milton Keynes said that it came out of the blue. We know that proposals of this type were considered four times by the Cabinet during the previous Parliament and rejected on each occasion. Above all, we know that this measure was forced into the Conservative manifesto as a cover for the Prime Minister's personal failure to fulfil her personal pledge to abolish domestic rates and was not incorporated in it on its merits.
  The Conservative party has traditionally seen itself as the party most in favour of the maximum diffusion of economic and political power, and of the weakest possible state. Lord Salisbury, in laying the foundations of the present system of local democracy, told the Conservative national union:
  "the purpose of local government is to diminish central government."
  Other Members of the Conservative party have followed that advice throughout the decades.
  The Secretary of State for the Environment told the Conservative party conference in 1980:
  "I also believe that a massive shift of power from local government to central Government would be wholly incompatible with our wish to entrust people personally and directly with the maximum responsibility for their lives."
  More recently, we have been told by the Prime Minister that less government is better government, and that the purpose of the Conservatives is to
  "roll back the frontiers of the Slate."
  The debate is particularly poignant occasion because 100 years of Conservative traditions, customs and principles are to be torn up in pursuit of this sordid measure, which will not work in practice but will accord to the Secretary of State for the Environment unbelievable powers centrally to control rates, and therefore the services of every local authority in the land.
  We know from the defensive speech of the Secretary of State and his colleagues, and what he himself has declared in the past, that he knows that he is departing from Conservative principles. When talking at a dinner of county treasurers in 1973, he said of local authorities:
  "As autonomous bodies, they cannot be coerced. nor have we any wish to coerce them."
  Earlier in 1973, at a meeting of the Association of Municipal Corporations, he said:

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  "I would very much rather see local authorities have a fair degree of discretion and prepared to take on their own shoulders the full responsibility for their decisions rather than that they should merely become glorified agents for Whitehall."
  The Secretary of State, in justifying his actions, has invented the novel constitutional notion that Britain is a unitary state. Albania and the Dominican Republic are also unitary states but they are not democracies.
  The extent to which power is spread makes a country democratic. That applies, most of all, to the extent to which those who do not support the Government of the day are themselves accorded power to express their view, and above all, power to act in a way that is contrary to the Government's wishes.
  In the celebrated Dimbleby lecture in 1976 Lord Hailsham warned that over-centralisation, of exactly the sort that we are discussing tonight, would lead, in his words, to an "elective dictatorship" and to Government riding roughshod over all those who fail wholeheartedly to agree with them.
  The Secretary of State is unquestionably taking the House and the country down a road that will destroy local democracy. He will do so by controlling the services of local authorities and, more sinister, by challenging the legitimacy of those who vote in local elections. For the Secretary of State to argue that in the past there has been a form of consensus between local authorities and central Government over economic policy, which some allegedly overspending authorities have broken, is nonsense. As my hon. Friend the Member for Rotherham (Mr. Crowther) has said, there has never been such a consensus, There has been discussion between local authorities and the national Government; sometimes authorities have spent more than central Government would have wished and sometimes they have spent less. That has been the experience of Governments of both major parties.
  In 1972, the present Secretary of State for Education and Science sent a circular to every local authority in the land advising it to plan for an increase in its spending of 10 per cent. per annum in real terms for each of the following 10 years. That Conservative underspending Secretary of State advised every authority to increase its spending by over 100 per cent. in real terms in the following 10 years. No authority in the land was able to match his profligacy. It was only the autonomy of local authorities and local democracy that prevented one man's brainstorm from becoming the nation's disaster.
  There will always be room for argument about exactly where the balance should lie between a uniform national policy and local autonomy. The Labour party has tended to favour greater intervention in education while the Conservative party has favoured greater intervention in housing. Wherever the balance between national policy and local autonomy has been struck, both sides of the House have always been agreed on one major and central principle. Each side has been agreed that in pursuing statutory duties each local authority and each community should have the right in the final analysis itself to determine how much to spend on a service and how much to raise in rates. Common sense has told us to leave it to local councillors to balance what their areas need against what their areas can afford. It is that central principle of local democracy, which has been accepted on an all-party basis for more than a century, that the Bill will destroy.
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  The Bill is the most important single measure that will come before the House this Session. As it is a constitutional measure of great importance, it merits consideration by a Committee of the whole House. In terms of the powers that it transfers, it is at least as significant constitutionally as the devolution Bills and the European Communities legislation, all of which were considered in Committee on the Floor of the House. The Bill is certainly of greater significance than the Conservative Government's London Government Bill of 1963, the major clause and schedule of which were considered in Committee on the Floor of the House.
  The Bill involves the greatest single act of centralisation ever seen in this century in peace time or in war. Those were the words of the former Conservative Prime Minister, the right hon. Member for Old Bexley and Sidcup (Mr. Heath). The Bill takes us down the road of the bureaucratic and authoritarian state. It is justified by economic arguments that are hollow and by constitutional arguments that are undemocratic and entirely inconsistent with the traditions and principles of the Conservative party. It is a measure without friends. It is opposed, moreover, by all parties outside the House. It cannot work and it is without justification. We shall fight it with all the means at our disposal. We shall vote against it this evening, and I hope that in so doing we shall be joined by many Conservative Members who have the courage of their own convictions and not of ours.
  9.30 pm
  The Under-Secretary of State for the Environment (Mr. William Waldegrave): The case for the Bill rests on two main arguments. One is to do with the need for the House to be able to exercise in reality the rights and duties it pretends to have in setting the level of total public expenditure and setting the priorities within public expenditure. The second is to do with ratepayers and the protection of the ratepayer against a system which no longer gives him a fair deal.
  The arguments against the Bill seem to fall broadly within the same headings. On the one hand, it is said that the burden of the ratepayer is exaggerated or it is claimed that the remedy lies in his own hand. On the other hand, some hon. Members seek to say that the House either has no right to control public spending or should not seek to do so.
  I start with the non-domestic ratepayers because the hon. Member for Blackburn (Mr. Straw) put some weight on this matter. He has been refuted by my hon. Friends the Members for Stamford and Spalding (Sir K. Lewis) and for Wiltshire, North (Mr. Needham) who have the advantage over him that they run businesses, and also by my hon. Friend the Member for Newark (Mr. Alexander). If they were not enough to refute him, as they should be, there are other authorities urging support for the Bill—the Confederation of British Industry, the Association of British Chambers of Commerce, the Institute of Directors and the Chemical Industries Association. All this must count for something with my hon. Friends. A survey of London companies showed that 92 per cent. of the companies surveyed said that high rates led to job losses. A recent opinion poll showed that a majority of Labour voters agreed with them.
  Mr. Nellist rose—
  Mr. Waldegrave: Small businesses of different kinds support the Bill. I shall quote one that I came across recently whose rates went up from £90,000 to over £160,000 in a year and which had to lay off people: it is a small, indeed declining, business called the Labour party at 150 Walworth road. There can be no question but that the additional fixed costs represented by rates will be passed on either in higher prices or in the fiercely competitive atmosphere of recent recession.
  Mr. Nellist rose—
  Mr. Waldegrave: If this is not possible, firms will be forced to pay lower wages or, if unions prevent that, to diminish their labour forces. If hon. Members want a clear, professional, economic analysis of that truism, I refer them to Christopher Foster's great book on the subject.
  Mr. Nellist rose—
  Mr. Waldegrave: I know that the hon. Member is frustrated, but it is not for me to give him the opportunity to make his speech.
  Mr. Foster's book further deploys an interesting argument about fairness and high business rates, that in so far as high business rates are passed on in higher prices the effect is that
  "local authorities can provide benefits to their local community at the expense of people elsewhere who have no say in the matter."
  The hon. Member for Blackburn has brewed up a storm in a teacup to which he did not refer in his speech. I want to give him the opportunity to refer to it; I think he is a little ashamed of it now. He has talked about the difference between a figure I gave him on the subject of rates as a proportion of profits and a CBI estimate. The CBI estimate was 50 per cent. or more. The Department of the Environment estimate was one eighth. There is a simple answer, as the hon. Member now knows. It was made explicit in my answer that I was talking about profits before allowance for depreciation and the CBI was talking about profits after depreciation. The difference is almost wholly explained by this simple point. Perhaps the hon. Member for Blackburn, as a former economics spokesman for the Labour party, would like to learn about definitions of profits.
  Mr. Tony Banks: On a point of order, Mr. Speaker. Unfortunately, because the Minister is speaking so fast and looking straight down at the Dispatch Box, we cannot hear a word he is saying.
  Mr. Speaker: Order. I think that the House can hear, but if there were less chat on the Back Benches it might be easier.
  Mr. Nellist rose—
  Mr. Waldegrave: I wanted to give the hon. Member for Blackburn, who is a decent and fair-minded person, the opportunity to apologise to my right hon. Friend because he said in the national press in so many words that my right hon. Friend was lying. He knows that that is not so. Therefore, I give him the opportunity to apologise.
  Mr. Nellist: Will the Minister give way now?
  Mr. Straw: I am delighted not to apologise but to take this opportunity to repeat once again that the Secretary of State has wildly exaggerated the impact of rates on the profits of business. The Secretary of State says that the
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  figures are those produced by the CBI, but the Under-Secretary of State forgot to say that the letter which the Secretary of State wrote to me admitted that the figure was not 50 per cent. but 40 per cent. The CBI tells me that the figure for this year is 30 per cent. In selecting the figure which was tendentious—the Secretary of State knew that—he was trying wildly to exaggerate the impact of rates and his hon. Friend the Under-Secretary of State who quoted a figure which was one quarter of that given by the Secretary of State was giving the correct figure.
  Mr. Waldegrave: The hon. Gentleman might have disappointed the House by not exhibiting his normal fair-mindedness. I trust that in future he will read the questions that he has tabled as well as the answers to them.
  There can be no question of the importance of the Bill for industry and commerce. No serious person denies that. Nor can there be any doubt about the impact on domestic ratepayers. That is not a serious argument.
  Accountability is an argument which has exercised the minds of many of my right hon. and hon. Friends who have their doubts. That is a serious argument and we must address it.
  Mr. Anthony Beaumont-Dark rose—
  Mr. Waldegrave: Many people say that it is not that high rates do not matter but that the remedy lies in the hands of ratepayers. That argument was made by the hon. Member for Copeland (Dr. Cunningham), by my right hon. Friend the Member for Old Bexley and Sidcup (Mr. Heath) and by my hon. Friend the Member for Manchester, Withington (Mr. Silvester). My right hon. Friend the Secretary of State has given the essence of the answer to that argument. Only 22 per cent. of local expenditure is met by the domestic ratepayer. As my right hon. Friend says, the weakness does not stop there. Only 35 per cent. of local electors are householders who pay rates directly. We all know, and any psephologist can prove, that local elections are reflections of satisfaction or otherwise with the national Government.
  I am not suggesting that financial accountability mechanisms do not work at all. They work in many places where sensible and responsible people run local government. Such people make the accountability system work almost voluntarily, but the system is far too weak to protect ratepayers in such classic circumstances when the Government are right to take powers to prevent ratepayers suffering from institutions which are not working as intended.
  My right hon. Friend the Member for Old Bexley and Sidcup said that he opposes the centralisation of power. In a fierce, formidable and short speech, my hon. Friend the Member for Milton Keynes (Mr. Benyon) said the same. That is quite right, but the only aternative if we are serious about the maintenance of control over public spending is so to diminish local athorities that their spending would not matter to the management of the central economy. That would be a real centralisation of power. Great services would have to be taken from local authorities. Surely that would be far worse for those such as my right hon. Friend the Member for Old Bexley and Sidcup who are anxious about the diffusion of power. That argument was also made by my right hon. Friend the Member for Daventry (Mr. Prentice) and by my right hon. and learned Friend the Member for Hexham (Mr. Rippon). I urge them

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  to bear it in mind that if we are serious about the control of public spending and the annual votes on the level of public spending, what I have outlined is the only alternative.
  With all due respect to my right hon. Friend the Member for Old Bexley and Sidcup, he must remember when arguing about centralisation the far greater experiment that we made—I was a junior soldier in his army when we made it—in centralisation through the statutory incomes and prices policy. Surely that was a far greater exercise in centralisation than anything in the Bill. I believed in it at that time but learnt from experience that it could not work. The power to set priorities locally must remain with local authorities—even those whose levels of rates have been capped.
  Mr. Campbell-Savours: Will the Minister give way?
  Mr. Waldegrave: I have the duty to try to respond to the many formidable speeches that have been made.
  The other principal reason for the Bill lies at the heart of the Government's mandate — the struggle to hold down the growth of public spending. I suspect that some of my right hon. and hon. Friends who are doubtful about the Bill are also doubtful about the need to control public spending.
  The argument of principle was settled long ago when local spending was defined as public spending and included in the public expenditure White Papers approved by the House every year. Professor Alan Day said years ago in his brilliant essay in the minority report to the Layfield committee that local spending has long been the Achilles heel of this House's control over public spending.
  Year after year, we pretended to vote for levels of spending and an order of priorities within spending that were, in reality, mythical. Whenever, every year, spending was drifting up, the dissonance between reality and the myth was not too great. However, when the majority in the House votes for overall control and for a shift in the order of priorities, the self-contradiction begins to matter. Surely no one on the Conservative side pretends to doubt the right of the House, indeed the duty, not to shirk the control of spending. In an excellent maiden speech, my hon. Friend the Member for Basildon (Mr. Amess) made that clear.
  Mr. Patrick Cormack: Will my hon. Friend give way?
  Mr. Waldegrave: I shall quote from the best modern writer on Conservatism:
  "Where local spending and tax-raising cut across central macro-economic policy, Whitehall must have the right to call the tune."
  That was said by my hon. Friend the Member for Bath (Mr. Patten), the Under-Secretary of State for Northern Ireland.
  Mr. Cormack: Will my hon. Friend give way?
  Mr. Waldegrave: I honestly believe that it would serve the House better if I tried to answer the points that were made in the debate.
  My right hon. and learned Friend the Member for Hexham and the hon. Members for Copeland and Blackburn and others commented on the fact that we cut the rate support grant. Of course we cut the rate support grant. [Interruption.]
  Mr. Cormack: I am grateful to my hon. Friend for giving way. Does he accept that many of us are deeply disturbed that we have yet to hear a single word to justify the taking of these general powers? He now has 20 minutes to justify that part of the Bill. Will he please seek to do so?
  Mr. Waldegrave: I now have 19 minutes left after that intervention.
  Of course we cut the rate support grant. That was not an exercise in the transfer of spending from one tax to another, but an exercise in showing local authorities that we needed to cut spending. That is what they should have done in response. As my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) said, that is what they would have done in the old days. Of course Government spending went up faster, in total, than local spending. That is what the House voted for in all the White Papers. The House endorsed the Government's priorities, which included spending on defence, unemployment and the Health Service—on things that, by the accident of history, fall on the central government programmes.
  Some say that although we have the right, it is all de minimis. They say, "What does a few hundred million a year matter?" The hon. Member for Copeland and my right hon. Friend the Member for Old Bexley and Sidcup said that, as did my right hon. and learned Friend the Member for Hexham, my right hon. Friend the Member for Daventry and the hon. Member for Blackburn. Like all Labour spokesmen, he said "What does a few hundred million matter?" It matters intensely. I remind my hon. Friends that the whole argument about the Health Service last year was about finding an additional £110 million—[Interruption.]
  Mr. Wareing: On a point of order, Mr. Speaker. Would it not be better for the House and the conduct of the debate if the Minister looked at the Opposition Benches when he spoke and opened his mouth so that we could hear what he was saying? I am sure that he is ashamed of what he is saying, but let us hear what it is.
  Mr. Speaker: I must say in defence of the Minister that it is not his fault. There is so much noise in the Chamber that it is difficult to hear. I appeal to the House to hear the Minister in silence.
  Mr. Waldegrave: I shall fix my eyes on my colleague the right hon. Member for Bristol, South (Mr. Cocks) and hope that that will meet the wishes of the hon. Member for Liverpool, West Derby (Mr. Wareing).
  Mr. Tony Banks: On a point of order, Mr. Speaker. Some of us are trying to listen. However, I believe that the Minister is determined that we shall not hear him. He is mumbling and speaking too fast because he does not want us to hear what he is saying. I do not think that he believes what he is saying.
  Mr. Speaker: Order. Let me answer that point of order. I think that it would be fair to the Minister if he had a hearing, which would enable him to explain what his policy is.
  Mr. Waldegrave: I did not hear a word of the hon. Member's intervention.
  This £100 million matters intensely. Let me remind my hon. Friends that the whole argument in the Health Service last year was about the finding of £110 million. The local government overspend last year alone was seven times that

  249
  figure. I notice, sadly, that some of my hon. Friends who were most concerned about the situation in the Health Service are those who are most concerned today about our taking powers to try to control that kind of overspend. If we cannot ultimately control current expenditure overspends — and we cannot effectively do so without this Bill—we can do nothing but continue to slash the capital spend, a process that started under the late Mr. Crosland, continued under the right hon. Member for Bethnal Green and Stepney (Mr. Shore) and has gone on ever since. Again I notice among my hon. Friends who are our critics today some of those who were most vociferous — and justifiably so — in calling upon us to protect capital spending.
  The figures that my right hon. Friend gave about how local authority spending has increased in spite of all the efforts of my right hon. Friends in the last four years should be ingrained in the mind of every Member on the Government's side of this House by now. The volume increase is 4 per cent. The increase in cost terms is 9 per cent. The manpower figures went down a little by 4·5 per cent. but they have started to rise again and there are still about a million people more in local government than in 1963.
  These figures are not de minimis. This Bill is needed to help restore the balance in local government, which has been undermined by the conjunction of weakness in institutions and a determined attack on them by those who have seen that weakness. My hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi) agreed with this point. With respect to some of my right hon. Friends from some of the more sensible counties and those who run local government in those areas, they simply do not know what problems are faced by their colleagues elsewhere. Long may their innocence last.
  Let me try to spell out some of those problems. My right hon. Friend has already reminded us how weak direct accountability has become in many local authorities. One votes to spend £5 and if one contributes at all it is probably only £1 and the chances that one contributes at all are about three to one against. Nevertheless, in areas where traditional standards of public service still reign, councillors of all parties, albeit almost involuntarily, behave as if they should pretend that financial accountability works. Elsewhere new groups of those whose direct interests rest in the expansion of local government dominate councils and run them on quite different principles.
  Let me give some examples. According to David Walker of The Times, 39 Labour councillors in Camden work in taxpayer or ratepayer-financed jobs or in unions, 45 in Islington, 30 in Lambeth, 48 in Southwark and so on. These people are, it is said by some hon. Friends—by my hon. Friend the Member for Milton Keynes and other right hon. Friends who doubt the necessity for this Bill—to be entrusted, without any safeguard, with the task of cutting jobs and costs in the public sector, with negotiating with public sector unions and with constraining the expansion of the very empire of which they are the functionaries. If hon. Members believe that they will do that, they will believe anything. My hon. Friend the Member for Hampstead and Highgate put this case very well.
  I suppose that it is possible that we could pretend to believe that they hold, high-mindedly, to a Victorian ideology of disinterested public service, that the Victorian
  250
  political philosopher beginning with "M", of whom they are devotees, is after all John Stuart Mill, but they tell us different. It is asking rather a lot of my hon. Friends to read much of this thing, but they should have a look at the London Labour Briefing to find out what these people believe. I have read every word of it. There is a new breed of Labour councillors who are no more reticent on paper than on the soap box or the television screen. There are plenty of quotations that I could read to the House tonight if it were not for the affront to good sense. Let me quote from one of the many articles:
  "Labour councils should appoint teams of economic planners; and should be prepared to campaign vigorously against critic isms from capitalist lobbies about unfair competition, feather bedding etc."—
  and so on. I hear their supporters helping me along by saying, "Hear, hear", in the background.
  As The Guardian recounted of Ms. Valerie Wise, creator of the GLC's new women's committee:
  "She laughs, engagingly declines to conceal the sheer heady pleasure of sitting at this amazing, lifesize Monopoly board that is London".
  That is no exaggeration. These people are not given to exaggeration.
  Mr. Campbell-Savours: Will the Minister answer the question to which I tried to get an answer from him earlier? If local government elections are only a reflection of national Government popularity, why do not the Government introduce legislation to abolish elections to local authorities and simply appoint councillors?
  Mr. Waldegrave: Because in most of the country the system works perfectly well, with the good will of all concerned. We are dealing with a minority of places and areas where the system has been corrupted, and quite deliberately corrupted.
  As I was saying, this new breed of Labour councillors is not much given to exaggeration. Hear Mrs. Hodge, the leader of Islington, modestly describe herself and her people in the ratepayer-funded propaganda sheet "Focus" as
  "the most able, the most representative, the most united and the most committed group ever to have been returned to the town hall".
  We do not have wholly to share Mrs. Hodge's estimation of herself to recognise that these are people who know what they want to do and that they will do it unless the House stops them.
  To fail to see how firmly the ideology of Labour councils such as these is based on the expansion of local spending, paid for by the capitalism that they hate and the Westminster Government whom they despise, is to underestimate how formidable an enemy they are to local government as we have known it in this country.
  Ms. Clare Short: The Minister quoted John Stuart Mill. If I remember it correctly, he said that a democratic and free society was one where all opinion could flourish and we could debate openly and decide what was right. Nevertheless, the Minister tries to tell us that because some representatives in local authorities have views that he does not like, he will take away their power to represent the people who voted for them at the ballot box. Is that in John Stuart Mill?
  Mr. Waldegrave: The Government are proposing to provide reserve powers to protect the citizen and the ratepayer where the system is not protected properly by its own self-righting mechanisms.
  The hon. Member for Copeland (Dr. Cunningham) asked how much would be saved, and the hon. Member for Blackburn discussed Mr. Hepworth's article. Undoubtedly, we shall have a prolonged opportunity to discuss these matters in Committee. However, let us say that we were to save £300 million—that is probably the order of magnitude, as my right hon. Friend said—in the first year. It will depend entirely on the criteria that we finally agree. Let us say that the figure is £300 million or £400 million. That would be a major contribution to keeping Government finances on an even keel. I have already mentioned the scale of savings that we could make in this connection alongside the kind of savings—
  Mr. Straw rose—
  Mr. Waldegrave: The hon. Gentleman knows perfectly well that until we have discussed and agreed the criteria it would be foolish to say exactly how much, and what is more, we do not yet know what the effect on local councils' budgeting for next year will be. Of course, many local councils are budgeting sensibly in advance of this Bill.
  Mr. Frank Cook: May I seek your guidance, Mr. Speaker, from your wealth of experience in this Chamber? Will you offer advice to some of the younger Members here? Would you say, from your experience, that the honourable spokesman for the Government has to make an effort, or whether it comes to him naturally, to prove himself so patently inept as a Government apologist?
  Mr. Speaker: I do not think that that requires any comment.
  Mr. Waldegrave: My hon. Friend the Member for Mid-Staffordshire (Mr. Heddle) asked about rating revaluation. The Government are already committed to the case for non-domestic revaluation, and that is now being discussed. On domestic revaluation, my right hon. Friend the Secretary of State has already announced that we shall be issuing a consultation paper.
  There is one matter that lay behind many of the complaints from my right hon. and hon. Friends, which derives from the pressures put on them by their counties, very often low-spending counties — Essex was mentioned, but there are many others. They have come to fear this Bill and have doubts about it because they see the predicament in which low-spending councils find themselves. Even in the lowest-spending councils, as the Audit Commission shows, there is much more to be saved by greater efficiency. I know of no organisation spending £300 million or £400 million a year that cannot make efficiency gains. It is at the heart of the Bill that if we can bring high spenders under control, it should be possible, perhaps slowly at first, to move towards a fairer deal for low spenders. It is our overriding duty
  252
  to the House, the Government and the national economy to make the books balance. If we cannot stop the runaway spenders we have to bring pressure to bear on everybody.
  The Bill brings help for those of my hon. Friends whose doubts about this rate support grant system as a whole derive from what they see in their counties. The Bill is essential to them in allowing the pressure to come off them in due course.
  Sir Kenneth Lewis: Will my hon. Friend recognise that many of us on the Government Benches who want to cap the rogue elephant in local government because they have got away with it for far too long nevertheless have grave reservations about part II, about which neither he nor the Secretary of State have said very much? We believe that the Committee should look at a compromise on this, such as putting on a time limit. My hon. Friend must not think that because many of us vote tonight with the Government in favour of rate capping we necessarily support him on part II.
  Mr. Waldegrave: I take my hon. Friend's point.
  I have supplied the arguments as to why the House needs a countervailing power to protect those who pay and to protect the concept of disinterested public service, which is under threat. What we propose will work—let no-one doubt that — and the very shrillness of the opposition to it proves it. No one doubts that it will work. To quote Peter Kellner of New Statesman, who is by far the best Labour political commentator:
  "The Government will say that its new law means lower rate rises. And it will be right."
  I point out to my right hn. Friend the Member for Daventry and others that the Bill will work. It has already worked in Scotland. Modern populism is the most acute problem that we face and any Government committed to responsibility in public finance will have to deal with it. There is also the deeper problem of the momentum for growth in programmes administered by local government. After all the conflicts of the past years, that growth goes on. As David Walker writes, the party is not over—it is somewhat subdued.
  I remind my right hon. and hon. Friends of the figures once more. Local authority spending has increased 9 per cent. faster than prices and there has been a 4 per cent. increase in real volume. After all that my right hon. Friend has said and after all the votes in the House, manpower numbers are creeping up again. That is why we need the warning inherent in the general powers in the Bill. It is almost certain that the continuation of the present tough financial regime with the selective scheme will hold the line, but the primary financial duty of the House is to maintain overall financial order. If we are wrong about the effectiveness of the selective financial scheme we could not possibly afford what might be two years' delay and a further round of legislation.
  If the House tonight endorses both the selective and the general powers, not only will a signal have been given so that those general powers will be less likely to be needed, but across the economy as a whole we shall have reaffirmed our commitment to the control of costs and the pressure on public spending that is at the heart of the

  253
  legitimacy of our mandate. That is why I urge those whose doubts I respect but cannot share to join us in the Lobby tonight.
  Question put, That the Bill be now read a Second time:—
  The House divided: Ayes 346, Noes 247.

  Division No. 123]

  [10 pm

  AYES

  Adley, Robert

  Crouch, David

  Aitken, Jonathan

  Currie, Mrs Edwina

  Alexander, Richard

  Dickens, Geoffrey

  Alison, Rt Hon Michael

  Dicks, T.

  Amess, David

  Dorrell, Stephen

  Ancram, Michael

  Douglas-Hamilton, Lord J.

  Arnold, Tom

  Dover, Denshore

  Ashby, David

  du Cann, Rt Hon Edward

  Aspinwall, Jack

  Dunn, Robert

  Atkins, Rt Hon Sir H.

  Durant, Tony

  Atkins, Robert (South Ribble)

  Edwards, Rt Hon N. (P'broke)

  Atkinson, David (B'm'th E)

  Eggar, Tim

  Baker, Kenneth (Mole Valley)

  Emery, Sir Peter

  Baker, Nicholas (N Dorset)

  Evennett, David

  Baldry, Anthony

  Eyre, Reginald

  Banks, Robert (Harrogate)

  Fallon, Michael

  Batiste, Spencer

  Farr, John

  Bellingham, Henry

  Favell, Anthony

  Bendall, Vivian

  Fenner, Mrs Peggy

  Bennett, Sir Frederic (T'bay)

  Finsberg, Geoffrey

  Berry, Sir Anthony

  Fletcher, Alexander

  Best, Keith

  Fookes, Miss Janet

  Bevan, David Gilroy

  Forman, Nigel

  Biffen, Rt Hon John

  Forsyth, Michael (Stirling)

  Biggs-Davison, Sir John

  Forth, Eric

  Body, Richard

  Fowler, Rt Hon Norman

  Bonsor, Sir Nicholas

  Franks, Cecil

  Bottomley, Peter

  Fraser, Rt Hon Sir Hugh

  Bowden, A. (Brighton K'to'n)

  Fraser, Peter (Angus East)

  Bowden, Gerald (Dulwich)

  Fry, Peter

  Boyson, Dr Rhodes

  Gale, Roger

  Braine, Sir Bernard

  Galley, Roy

  Brandon-Bravo, Martin

  Gardiner, George (Reigate)

  Bright, Graham

  Gardner, Sir Edward (Fylde)

  Brinton, Tim

  Garel-Jones, Tristan

  Brittan, Rt Hon Leon

  Glyn, Dr Alan

  Brooke, Hon Peter

  Goodhart, Sir Philip

  Brown, M. (Brigg & Cl'thpes)

  Goodlad, Alastair

  Browne, John

  Gorst, John

  Bruinvels, Peter

  Gow, Ian

  Bryan, Sir Paul

  Gower, Sir Raymond

  Buchanan-Smith, Rt Hon A.

  Grant, Sir Anthony

  Buck, Sir Antony

  Greenway, Harry

  Budgen, Nick

  Gregory, Conal

  Bulmer, Esmond

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

  Burt, Alistair

  Griffiths, Peter (Portsm'th N)

  Butcher, John

  Grist, Ian

  Butler, Hon Adam

  Ground, Patrick

  Butterfill, John

  Grylls, Michael

  Carlisle, John (N Luton)

  Gummer, John Selwyn

  Carlisle, Kenneth (Lincoln)

  Hamilton, Hon A. (Epsom)

  Carttiss, Michael

  Hamilton, Neil (Tatton)

  Chalker, Mrs Lynda

  Hampson, Dr Keith

  Channon, Rt Hon Paul

  Hanley, Jeremy

  Chapman, Sydney

  Hannam, John

  Chope, Christopher

  Hargreaves, Kenneth

  Churchill, W. S.

  Harvey, Robert

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

  Haselhurst, Alan

  Clark, Dr Michael (Rochford)

  Havers, Rt Hon Sir Michael

  Clark, Sir W. (Croydon S)

  Hawkins, C. (High Peak)

  Clarke Kenneth (Rushcliffe)

  Hawkins, Sir Paul (SW N'folk)

  Clegg, Sir Walter

  Hawksley, Warren

  Cockeram, Eric

  Hayes, J.

  Colvin, Michael

  Hayhoe, Barney

  Conway, Derek

  Hayward, Robert

  Coombs, Simon

  Heathcoat-Amory, David

  Cope, John

  Heddle, John

  Corrie, John

  Henderson, Barry

  Couchman, James

  Heseltine, Rt Hon Michael

  Cranborne, Viscount

  Hickmet. Richard

  254

  Higgins, Rt Hon Terence L.

  Morrison, Hon P. (Chester)

  Hill, James

  Moynihan, Hon C.

  Hind, Kenneth

  Mudd, David

  Hirst, Michael

  Murphy, Christopher

  Hogg, Hon Douglas (Gr'th'm)

  Neale, Gerrard

  Holland, Sir Philip (Gedling)

  Needham, Richard

  Holt, Richard

  Nelson, Anthony

  Hooson, Tom

  Neubert, Michael

  Hordern, Peter

  Newton, Tony

  Howard, Michael

  Nicholls, Patrick

  Howarth, Alan (Stratf'd-on-A)

  Normanton, Tom

  Howarth, Gerald (Cannock)

  Norris, Steven

  Howe, Rt Hon Sir Geoffrey

  Onslow, Cranley

  Howell, Ralph (N Norfolk)

  Oppenheim, Philip

  Hubbard-Miles, Peter

  Osborn, Sir John

  Hunt, David (Wirral)

  Ottaway, Richard

  Hunt, John (Ravensbourne)

  Page, John (Harrow W)

  Hunter, Andrew

  Page, Richard (Herts SW)

  Hurd, Rt Hon Douglas

  Parkinson, Rt Hon Cecil

  Irving, Charles

  Parris, Matthew

  Jackson, Robert

  Patten, Christopher (Bath)

  Jenkin, Rt Hon Patrick

  Patten, John (Oxford)

  Jessel, Toby

  Pattie, Geoffrey

  Johnson-Smith, Sir Geoffrey

  Pawsey, James

  Jones, Gwilym (Cardiff N)

  Peacock, Mrs Elizabeth

  Jones, Robert (W Herts)

  Percival, Rt Hon Sir Ian

  Jopling, Rt Hon Michael

  Pink, R. Bonner

  Joseph, Rt Hon Sir Keith

  Pollock, Alexander

  Kellett-Bowman, Mrs Elaine

  Porter, Barry

  Key, Robert

  Powell, William (Corby)

  King, Roger (B'ham N'field)

  Powley, John

  King, Rt Hon Tom

  Prior, Rt Hon James

  Knight, Gregory (Derby N)

  Proctor, K. Harvey

  Knight, Mrs Jill (Edgbaston)

  Raffan, Keith

  Knowles, Michael

  Raison, Rt Hon Timothy

  Lamont, Norman

  Rees, Rt Hon Peter (Dover)

  Lang, Ian

  Rhodes James, Robert

  Lawler, Geoffrey

  Rhys Williams, Sir Brandon

  Lawrence, Ivan

  Ridley, Rt Hon Nicholas

  Lawson, Rt Hon Nigel

  Rifkind, Malcolm

  Lee, John (Pendle)

  Roberts, Wyn (Conwy)

  Leigh, Edward (Gainsbor'gh)

  Robinson, Mark (N'port W)

  Lennox-Boyd, Hon Mark

  Roe, Mrs Marion

  Lewis, Sir Kenneth (Stamf'd)

  Rossi, Sir Hugh

  Lilley, Peter

  Rost, Peter

  Lloyd, Ian (Havant)

  Rowe, Andrew

  Lloyd, Peter, (Fareham)

  Rumbold, Mrs Angela

  Lord, Michael

  Ryder, Richard

  Luce, Richard

  Sackville, Hon Thomas

  Lyell, Nicholas

  Sainsbury, Hon Timothy

  McCurley, Mrs Anna

  Sayeed, Jonathan

  Macfarlane, Neil

  Scott, Nicholas

  MacGregor, John

  Shaw, Giles (Pudsey)

  MacKay, Andrew (Berkshire)

  Shaw, Sir Michael (Scarb)

  MacKay, John (Argyll & Bute)

  Shelton, William (Streatham)

  Maclean, David John.

  Shepherd, Colin (Hereford)

  McQuarrie, Albert

  Shepherd, Richard (Aldridge)

  Madel, David

  Shersby, Michael

  Major, John

  Silvester, Fred

  Malone, Gerald

  Sims, Roger

  Maples, John

  Skeet, T. H. H.

  Marland, Paul

  Smith, Sir Dudley (Warwick)

  Marlow, Antony

  Smith, Tim (Beaconsfield)

  Marshall, Michael (Arundel)

  Soames, Hon Nicholas

  Mates, Michael

  Speller, Tony

  Maude, Francis

  Spence, John

  Mawhinney, Dr Brian

  Spencer, D.

  Maxwell-Hyslop, Robin

  Spicer, Jim (W Dorset)

  Mayhew, Sir Patrick

  Spicer, Michael (S Worcs)

  Mellor, David

  Squire, Robin

  Merchant, Piers

  Stanbrook, Ivor

  Miller, Hal (B'grove)

  Stanley, John

  Mills, Iain (Meriden)

  Stern, Michael

  Mills, Sir Peter (West Devon)

  Stevens, Lewis (Nuneaton)

  Miscampbell, Norman

  Stevens, Martin (Fulham)

  Mitchell, David (NW Hants)

  Stewart, Allan (Eastwood)

  Moate, Roger

  Stewart, Andrew (Sherwood)

  Monro, Sir Hector

  Stewart, Ian (N Hertf'dshire)

  Montgomery, Fergus

  Stokes, John

  Moore, John

  Stradling Thomas, J.

  255

  Sumberg, David

  Walker, Bill (T'side N)

  Tapsell, Peter

  Walker, Rt Hon P. (W'cester)

  Taylor, John (Solihull)

  Waller, Gary

  Taylor, Teddy (S'end E)

  Walters, Dennis

  Tebbit, Rt Hon Norman

  Ward, John

  Temple-Morris, Peter

  Wardle, C. (Bexhill)

  Terlezki, Stefan

  Warren, Kenneth

  Thatcher, Rt Hon Mrs M.

  Watson, John

  Thompson, Donald (Calder V)

  Watts, John

  Thompson, Patrick (N'ich N)

  Wells, John (Maidstone)

  Thorne, Neil (Ilford S)

  Wheeler, John

  Thornton, Malcolm

  Whitfield, John

  Thurnham, Peter

  Whitney, Raymond

  Townend, John (Bridlington)

  Wiggin, Jerry

  Townsend, Cyril D. (B'heath)

  Wilkinson, John

  Tracey, Richard

  Wolfson, Mark

  Trippier, David

  Wood, Timothy

  Trotter, Neville

  Woodcock, Michael

  Twinn, Dr Ian

  Yeo, Tim

  van Straubenzee, Sir W.

  Young, Sir George (Acton)

  Vaughan, Dr Gerard

  Younger, Rt Hon George

  Viggers, Peter

  Waddington, David

  Tellers for the Ayes:

  Wakeham, Rt Hon John

  Mr. Carol Mather and

  Waldegrave, Hon William

  Mr. Robert Boscawen.

  Walden, George

  NOES

  Abse, Leo

  Cowans, Harry

  Alton, David

  Cox, Thomas (Tooting)

  Anderson, Donald

  Craigen, J. M.

  Archer, Rt Hon Peter

  Critchley, Julian

  Ashdown, Paddy

  Crowther, Stan

  Ashley, Rt Hon Jack

  Cunliffe, Lawrence

  Ashton, Joe

  Cunningham, Dr John

  Atkinson, N. (Tottenham)

  Dalyell, Tam

  Bagier, Gordon A. T.

  Davies, Rt Hon Denzil (L'lli)

  Banks, Tony (Newham NW)

  Davies, Ronald (Caerphilly)

  Barnett, Guy

  Davis, Terry (B'ham, H'ge H'I)

  Barron, Kevin

  Deakins, Eric

  Beaumont-Dark, Anthony

  Dewar, Donald

  Beckett, Mrs Margaret

  Dixon, Donald

  Beggs, Roy

  Dobson, Frank

  Beith, A. J.

  Dormand, Jack

  Bell, Stuart

  Douglas, Dick

  Bennett, A. (Dent'n & Red'sh)

  Dubs, Alfred

  Benyon, William

  Dunwoody, Hon Mrs G.

  Bermingham, Gerald

  Dykes, Hugh

  Bidwell, Sydney

  Eadie, Alex

  Blair, Anthony

  Eastham, Ken

  Boothroyd, Miss Betty

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

  Boyes, Roland

  Ellis, Raymond

  Bray, Dr Jeremy

  Evans, Ioan (Cynon Valley)

  Brown, Gordon (D'f'mline E)

  Evans, John (St. Helens N)

  Brown, Hugh D. (Provan)

  Ewing, Harry

  Brown, N. (N'c'tle-u-Tyne E)

  Fatchett, Derek

  Brown, R. (N'c'tle-u-Tyne N)

  Faulds, Andrew

  Brown, Ron (E'burgh, Leith)

  Field, Frank (Birkenhead)

  Bruce, Malcolm

  Fields, T. (L'pool Broad Gn)

  Buchan, Norman

  Fisher, Mark

  Caborn, Richard

  Flannery, Martin

  Callaghan, Rt Hon J.

  Foot, Rt Hon Michael

  Callaghan, Jim (Heyw'd & M)

  Forrester, John

  Campbell, Ian

  Forsythe, Clifford (S Antrim)

  Campbell-Savours, Dale

  Foster, Derek

  Carlile, Alexander (Montg'y)

  Foulkes, George

  Carter-Jones, Lewis

  Fraser, J. (Norwood)

  Cartwright, John

  Freeman, Roger

  Clark, Dr David (S Shields)

  Freeson, Rt Hon Reginald

  Clarke, Thomas

  Freud, Clement

  Clay, Robert

  Garrett, W. E.

  Cocks, Rt Hon M. (Bristol S.)

  George, Bruce

  Cohen, Harry

  Gilbert, Rt Hon Dr John

  Coleman, Donald

  Gilmour, Rt Hon Sir Ian

  Concannon, Rt Hon J. D.

  Godman, Dr Norman

  Conlan, Bernard

  Golding, John

  Cook, Frank (Stockton North)

  Gould, Bryan

  Cook, Robin F. (Livingston)

  Gourlay, Harry

  Corbett, Robin

  Hamilton, James (M'well N)

  Corbyn, Jeremy

  Hamilton, W. W. (Central Fife)

  256

  Hardy, Peter

  O'Neill, Martin

  Harman, Ms Harriet

  Orme, Rt Hon Stanley

  Harrison, Rt Hon Walter

  Owen, Rt Hon Dr David

  Hart, Rt Hon Dame Judith

  Park, George

  Hattersley, Rt Hon Roy

  Parry, Robert

  Healey, Rt Hon Denis

  Patchett, Terry

  Heath, Rt Hon Edward

  Pavitt, Laurie

  Heffer, Eric S.

  Pendry, Tom

  Hogg, N. (C'nauld & Kilsyth)

  Penhaligon, David

  Holland, Stuart (Vauxhall)

  Pike, Peter

  Home Robertson, John

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

  Howell, Rt Hon D. (S'heath)

  Powell, Raymond (Ogmore)

  Howells, Geraint

  Prentice, Rt Hon Reg

  Hoyle, Douglas

  Prescott, John

  Hughes, Mark (Durham)

  Radice, Giles

  Hughes, Robert (Aberdeen N)

  Randall, Stuart

  Hughes, Roy (Newport East)

  Redmond, M.

  Hughes, Sean (Knowsley S)

  Rees, Rt Hon M. (Leeds S)

  Hughes, Simon (Southwark)

  Richardson, Ms Jo

  Janner, Hon Greville

  Rippon, Rt Hon Geoffrey

  Jenkins, Rt Hon Roy (Hillh'd)

  Roberts, Allan (Bootle)

  John, Brynmor

  Roberts, Ernest (Hackney N)

  Johnston, Russell

  Robinson, G. (Coventry NW)

  Jones, Barry (Alyn & Deeside)

  Rogers, Allan

  Kaufman, Rt Hon Gerald

  Rooker, J. W.

  Kennedy, Charles

  Ross, Ernest (Dundee W)

  Kilfedder, James A.

  Ross, Stephen (Isle of Wight)

  Kilroy-Silk, Robert

  Ross, Wm. (Londonderry)

  Kinnock, Rt Hon Neil

  Rowlands, Ted

  Kirkwood, Archibald

  Ryman, John

  Lambie, David

  Sedgemore, Brian

  Lamond, James

  Sheerman, Barry

  Leadbitter, Ted

  Sheldon, Rt Hon R.

  Leighton, Ronald

  Shore, Rt Hon Peter

  Lewis, Ron (Carlisle)

  Short, Ms Clare (Ladywood)

  Lewis, Terence (Worsley)

  Short, Mrs R. (W'hampt'n NE)

  Litherland, Robert

  Silkin, Rt Hon J.

  Lloyd, Tony (Stretford)

  Skinner, Dennis

  Lofthouse, Geoffrey

  Smith, C.(Isl'ton S & F'bury)

  Loyden, Edward

  Smith, Cyril (Rochdale)

  McCartney, Hugh

  Smith, Rt Hon J. (M'kl'ds E)

  McCusker, Harold

  Smyth, Rev W. M. (Belfast S)

  McDonald, Dr Oonagh

  Snape, Peter

  McGuire, Michael

  Soley, Clive

  McKay, Allen (Penistone)

  Speed, Keith

  McKelvey, William

  Steel, Rt Hon David

  Mackenzie, Rt Hon Gregor

  Stott, Roger

  Maclennan, Robert

  Strang, Gavin

  Macmillan, Rt Hon M.

  Straw, Jack

  McNamara, Kevin

  Thomas, Dafydd (Merioneth)

  McTaggart, Robert

  Thomas, Dr R. (Carmarthen)

  Madden, Max

  Thompson, J. (Wansbeck)

  Maginnis, Ken

  Thorne, Stan (Preston)

  Marek, Dr John

  Tinn, James

  Marshall, David (Shettleston)

  Torney, Tom

  Martin, Michael

  Wainwright, R.

  Mason, Rt Hon Roy

  Walker, Cecil (Belfast N)

  Maxton, John

  Wallace, James

  Maynard, Miss Joan

  Warden, Gareth (Gower)

  Meacher, Michael

  Wareing, Robert

  Meadowcroft, Michael

  Weetch, Ken

  Michie, William

  White, James

  Mikardo, Ian

  Wigley, Dafydd

  Millan, Rt Hon Bruce

  Williams, Rt Hon A.

  Miller, Dr M. S. (E Kilbride)

  Winnick, David

  Mitchell, Austin (G't Grimsby)

  Winterton, Nicholas

  Molyneaux, Rt Hon James

  Woodall, Alec

  Morris, Rt Hon A. (W'shawe)

  Wrigglesworth, Ian

  Morris, Rt Hon J. (Aberavon)

  Young, David (Bolton SE)

  Morrison, Hon C. (Devizes)

  Nellist, David

  Tellers for the Noes:

  Oakes, Rt Hon Gordon

  Mr. John McWilliam and

  O'Brien, William

  Mr. Frank Haynes.

  Question accordingly agreed to.
  Motion made, and Question proposed, That the Bill be committed to a Committee of the whole House.—[Mr. Rippon.]
  Question put:—
  The House divided: Ayes 255, Noes 346.

  Division No. 124]

  [10.15 pm

  AYES

  Abse, Leo

  Edwards, R. (Whampt'n SE)

  Alton, David

  Ellis, Raymond

  Anderson, Donald

  Evans, Ioan (Cynon Valley)

  Archer, Rt Hon Peter

  Evans, John (St. Helens N)

  Ashdown, Paddy

  Ewing, Harry

  Ashley, Rt Hon Jack

  Fatchett, Derek

  Ashton, Joe

  Faulds, Andrew

  Atkinson, N. (Tottenham)

  Field, Frank (Birkenhead)

  Bagier, Gordon A. T.

  Fields, T. (L'pool Broad Gn)

  Banks, Tony (Newham NW)

  Fisher, Mark

  Barnett, Guy

  Flannery, Martin

  Barron, Kevin

  Foot, Rt Hon Michael

  Beaumont-Dark, Anthony

  Forrester, John

  Beckett, Mrs Margaret

  Forsythe, Clifford (S Antrim)

  Beggs, Roy

  Foster, Derek

  Beith, A. J.

  Foulkes, George

  Bell, Stuart

  Fraser, J. (Norwood)

  Bennett, A. (Dent'n & Red'sh)

  Freeson, Rt Hon Reginald

  Benyon, William

  Freud, Clement

  Bermingham, Gerald

  Garrett, W. E.

  Bidwell, Sydney

  George, Bruce

  Blair, Anthony

  Gilbert, Rt Hon Dr John

  Boothroyd, Miss Betty

  Gilmour, Rt Hon Sir Ian

  Boyes, Roland

  Godman, Dr Norman

  Bray, Dr Jeremy

  Golding, John

  Brown, Gordon (D'f'mline E)

  Gould, Bryan

  Brown, Hugh D. (Provan)

  Gourlay, Harry

  Brown, N. (N'c'tle-u-Tyne E)

  Hamilton, James (M'well N)

  Brown, R. (N'c'tle-u-Tyne N)

  Hamilton, W. W. (Central Fife)

  Brown, Ron (E'burgh, Leith)

  Hardy, Peter

  Bruce, Malcolm

  Harman, Ms Harriet

  Buchan, Norman

  Harrison, Rt Hon Walter

  Caborn, Richard

  Hart, Rt Hon Dame Judith

  Callaghan, Rt Hon J.

  Hattersley, Rt Hon Roy

  Callaghan, Jim (Heyw'd & M)

  Haynes, Frank

  Campbell, Ian

  Healey, Rt Hon Denis

  Campbell-Savours, Dale

  Heath, Rt Hon Edward

  Carlile, Alexander (Montg'y)

  Heffer, Eric S.

  Carter-Jones, Lewis

  Hogg, N. (C'nauld & Kilsyth)

  Cartwright, John

  Holland, Stuart (Vauxhall)

  Clark, Dr David (S Shields)

  Howell, Rt Hon D. (S'heath)

  Clarke, Thomas

  Howells, Geraint

  Clay, Robert

  Hoyle, Douglas

  Cocks, Rt Hon M. (Bristol S.)

  Hughes, Mark (Durham)

  Cohen. Harry

  Hughes, Robert (Aberdeen N)

  Coleman, Donald

  Hughes, Roy (Newport East)

  Concannon, Rt Hon J. D.

  Hughes, Sean (Knowsley S)

  Conlan, Bernard

  Hughes, Simon (Southwark)

  Cook, Frank (Stockton North)

  Janner, Hon Greville

  Cook, Robin F. (Livingston)

  Jenkins, Rt Hon Roy (Hillh'd)

  Corbett, Robin

  John, Brynmor

  Corbyn, Jeremy

  Johnston, Russell

  Cormack, Patrick

  Jones, Barry (Alyn & Deeside)

  Cowans, Harry

  Kaufman, Rt Hon Gerald

  Cox, Thomas (Tooting)

  Kennedy, Charles

  Craigen, J. M.

  Kilfedder, James A.

  Cranborne, Viscount

  Kilroy-Silk, Robert

  Critchley, Julian

  Kinnock, Rt Hon Neil

  Crowther, Stan

  Kirkwood, Archibald

  Cunliffe, Lawrence

  Lambie, David

  Cunningham, Dr John

  Lamond, James

  Dalyell, Tam

  Leadbitter, Ted

  Davies, Rt Hon Denzil (L'lli)

  Leighton, Ronald

  Davies, Ronald (Caerphilly)

  Lewis, Sir Kenneth (Stamf'd)

  Davis, Terry (B'ham, H'ge H'I)

  Lewis, Ron (Carlisle)

  Deakins, Eric

  Lewis, Terence (Worsley)

  Dewar, Donald

  Lightbown, David

  Dixon, Donald

  Litherland, Robert

  Dobson, Frank

  Lloyd, Tony (Stretford)

  Dormand, Jack

  Lofthouse, Geoffrey

  Douglas, Dick

  Loyden, Edward

  Dubs, Alfred

  McCartney, Hugh

  Dunwoody, Hon Mrs G.

  McCusker, Harold

  Dykes, Hugh

  McDonald, Dr Oonagh

  Eadie, Alex

  McGuire, Michael

  Eastham, Ken

  McKay, Allen (Penistone)

  258

  McKelvey, William

  Robinson, G. (Coventry NW)

  Mackenzie, Rt Hon Gregor

  Rogers, Allan

  Maclennan, Robert

  Rooker, J. W.

  Macmillan, Rt Hon M.

  Ross, Ernest (Dundee W)

  McNamara, Kevin

  Ross, Stephen (Isle of Wight)

  McTaggart, Robert

  Ross, Wm. (Londonderry)

  Madden, Max

  Rowlands, Ted

  Maginnis, Ken

  Ryman, John

  Marek, Dr John

  Sedgemore, Brian

  Marshall, David (Shettleston)

  Sheerman, Barry

  Martin, Michael

  Sheldon, Rt Hon R.

  Mason, Rt Hon Roy

  Shore, Rt Hon Peter

  Maxton, John

  Short, Ms Clare (Ladywood)

  Maxwell-Hyslop, Robin

  Short, Mrs R.(W'hampt'n NE)

  Maynard, Miss Joan

  Silkin, Rt Hon J.

  Meacher, Michael

  Skinner, Dennis

  Meadowcroft, Michael

  Smith, C.(Isl'ton S & F'bury)

  Meyer, Sir Anthony

  Smith, Cyril (Rochdale)

  Michie, William

  Smith, Rt Hon J. (M'kl'ds E)

  Mikardo, Ian

  Smyth, Rev W. M. (Belfast S)

  Millan, Rt Hon Bruce

  Snape, Peter

  Miller, Dr M. S. (E Kilbride)

  Soley, Clive

  Miscampbell, Norman

  Speed, Keith

  Mitchell, Austin (G't Grimsby)

  Steel, Rt Hon David

  Molyneaux, Rt Hon James

  Stott, Roger

  Morris, Rt Hon A. (W'shawe)

  Strang, Gavin

  Morris, Rt Hon J. (Aberavon)

  Straw, Jack

  Morrison, Hon C. (Devizes)

  Tapsell, Peter

  Nellist, David

  Thomas, Dafydd (Merioneth)

  Oakes, Rt Hon Gordon

  Thomas, Dr R. (Carmarthen)

  O'Brien, William

  Thompson, J. (Wansbeck)

  O'Neill, Martin

  Thorne, Stan (Preston)

  Orme, Rt Hon Stanley

  Tinn, James

  Owen, Rt Hon Dr David

  Torney, Tom

  Park, George

  Wainwright, R.

  Parry, Robert

  Walker, Cecil (Belfast N)

  Patchett, Terry

  Wallace, James

  Pavitt, Laurie

  Wardell, Gareth (Gower)

  Pendry, Tom

  Wareing, Robert

  Penhaligon, David

  Weetch, Ken

  Pike, Peter

  White, James

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

  Wigley, Dafydd

  Powell, Raymond (Ogmore)

  Williams, Rt Hon A.

  Prentice, Rt Hon Reg

  Winnick, David

  Prescott, John

  Winterton, Mrs Ann

  Radice, Giles

  Winterton, Nicholas

  Randall, Stuart

  Woodall, Alec

  Rathbone, Tim

  Wrigglesworth, Ian

  Redmond, M.

  Young, David (Bolton SE)

  Rees, Rt Hon M. (Leeds S)

  Richardson, Ms Jo

  Tellers for the Ayes:

  Rippon, Rt Hon Geoffrey

  Mr. John McWilliam and

  Roberts, Allan (Bootle)

  Mr. John Home Robertson.

  Roberts, Ernest (Hackney N)

  NOES

  Adley, Robert

  Biggs-Davison, Sir John

  Aitken, Jonathan

  Body, Richard

  Alexander, Richard

  Bonsor, Sir Nicholas

  Alison, Rt Hon Michael

  Bottomley, Peter

  Amess, David

  Bowden, A. (Brighton K'to'n)

  Ancram, Michael

  Bowden, Gerald (Dulwich)

  Arnold, Tom

  Boyson, Dr Rhodes

  Ashby, David

  Braine, Sir Bernard

  Aspinwall, Jack

  Brandon-Bravo, Martin

  Atkins, Rt Hon Sir H.

  Bright, Graham

  Atkins, Robert (South Ribble)

  Brinton, Tim

  Atkinson, David (B'm'th E)

  Brittan, Rt Hon Leon

  Baker, Kenneth (Mole Valley)

  Brooke, Hon Peter

  Baker, Nicholas (N Dorset)

  Brown, M. (Brigg & Cl'thpes)

  Baldry, Anthony

  Browne, John

  Banks, Robert (Harrogate)

  Bruinvels, Peter

  Batiste, Spencer

  Bryan, Sir Paul

  Bellingham, Henry

  Buchanan-Smith, Rt Hon A.

  Bendall, Vivian

  Buck, Sir Antony

  Bennett, Sir Frederic (T'bay)

  Budgen, Nick

  Berry, Sir Anthony

  Bulmer, Esmond

  Best, Keith

  Burt, Alistair

  Bevan, David Gilroy

  Butcher, John

  Biffen, Rt Hon John

  Butler, Hon Adam

  259

  Butterfill, John

  Haselhurst, Alan

  Carlisle, John (N Luton)

  Havers, Rt Hon Sir Michael

  Carlisle, Kenneth (Lincoln)

  Hawkins, C. (High Peak)

  Carttiss, Michael

  Hawkins, Sir Paul (SW N'folk)

  Chalker, Mrs Lynda

  Hawksley, Warren

  Channon, Rt Hon Paul

  Hayes, J.

  Chapman, Sydney

  Hayhoe, Barney

  Chope, Christopher

  Hayward, Robert

  Churchill, W. S.

  Heathcoat-Amory, David

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

  Heddle, John

  Clark, Dr Michael (Rochford)

  Henderson, Barry

  Clark, Sir W. (Croydon S)

  Heseltine, Rt Hon Michael

  Clarke Kenneth (Rushcliffe)

  Hickmet, Richard

  Clegg, Sir Walter

  Higgins, Rt Hon Terence L.

  Cockeram, Eric

  Hill, James

  Colvin, Michael

  Hind, Kenneth

  Conway, Derek

  Hirst, Michael

  Coombs, Simon

  Hogg, Hon Douglas (Gr'th'm)

  Cope, John

  Holland, Sir Philip (Gedling)

  Corrie, John

  Holt, Richard

  Couchman, James

  Hooson, Tom

  Crouch, David

  Hordern, Peter

  Currie, Mrs Edwina

  Howard, Michael

  Dickens, Geoffrey

  Howarth, Alan (Stratf'd-on-A)

  Dicks, T.

  Howarth, Gerald (Cannock)

  Dorrell, Stephen

  Howe, Rt Hon Sir Geoffrey

  Douglas-Hamilton, Lord J.

  Howell, Ralph (N Norfolk)

  Dover, Denshore

  Hubbard-Miles, Peter

  du Cann, Rt Hon Edward

  Hunt, David (Wirral)

  Dunn, Robert

  Hunt, John (Ravensbourne)

  Durant, Tony

  Hunter, Andrew

  Edwards, Rt Hon N. (P'broke)

  Hurd, Rt Hon Douglas

  Eggar, Tim

  Irving, Charles

  Emery, Sir Peter

  Jackson, Robert

  Evennett, David

  Jenkin, Rt Hon Patrick

  Eyre, Reginald

  Jessel, Toby

  Fallon, Michael

  Johnson-Smith, Sir Geoffrey

  Farr, John

  Jones, Gwilym (Cardiff N)

  Favell, Anthony

  Jones, Robert (W Herts)

  Fenner, Mrs Peggy

  Jopling, Rt Hon Michael

  Finsberg, Geoffrey

  Joseph, Rt Hon Sir Keith

  Fletcher, Alexander

  Kellett-Bowman, Mrs Elaine

  Fookes, Miss Janet

  Key, Robert

  Forman, Nigel

  King, Roger (B'ham N'field)

  Forsyth, Michael (Stirling)

  King, Rt Hon Tom

  Forth, Eric

  Knight, Gregory (Derby N)

  Fowler, Rt Hon Norman

  Knight, Mrs Jill (Edgbaston)

  Franks, Cecil

  Knowles, Michael

  Fraser, Rt Hon Sir Hugh

  Lamont, Norman

  Fraser, Peter (Angus East)

  Lang, Ian

  Freeman, Roger

  Latham, Michael

  Fry, Peter

  Lawler, Geoffrey

  Gale, Roger

  Lawrence, Ivan

  Galley, Roy

  Lawson, Rt Hon Nigel

  Gardiner, George (Reigate)

  Lee, John (Pendle)

  Gardner, Sir Edward (Fylde)

  Leigh, Edward (Gainsbor'gh)

  Garel-Jones, Tristan

  Lennox-Boyd, Hon Mark

  Glyn, Dr Alan

  Lilley, Peter

  Goodhart, Sir Philip

  Lloyd, Ian (Havant)

  Goodlad, Alastair

  Lloyd, Peter, (Fareham)

  Gorst, John

  Lord, Michael

  Gow, Ian

  Luce, Richard

  Gower, Sir Raymond

  Lyell, Nicholas

  Grant, Sir Anthony

  McCrindle, Robert

  Greenway, Harry

  McCurley, Mrs Anna

  Gregory, Conal

  Macfarlane, Neil

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

  MacGregor, John

  Griffiths, Peter (Portsm'th N)

  MacKay, Andrew (Berkshire)

  Grist, Ian

  MacKay, John (Argyll & Bute)

  Ground, Patrick

  Maclean, David John.

  Grylls, Michael

  McQuarrie, Albert

  Gummer, John Selwyn

  Madel, David

  Hamilton, Hon A. (Epsom)

  Major, John

  Hamilton, Neil (Tatton)

  Malone, Gerald

  Hampson, Dr Keith

  Maples, John

  Hanley, Jeremy

  Marland, Paul

  Hannam, John

  Marlow, Antony

  Hargreaves, Kenneth

  Marshall, Michael (Arundel)

  Harris, David

  Mates, Michael

  Harvey, Robert

  Maude, Francis

  260

  Mawhinney, Dr Brian

  Sims, Roger

  Mayhew, Sir Patrick

  Skeet, T. H. H.

  Mellor, David

  Smith, Sir Dudley (Warwick)

  Merchant, Piers

  Smith, Tim (Beaconsfield)

  Miller, Hal (B'grove)

  Soames, Hon Nicholas

  Mills, Iain (Meriden)

  Speller, Tony

  Mills, Sir Peter (West Devon)

  Spence, John

  Mitchell, David (NW Hants)

  Spencer, D.

  Moate, Roger

  Spicer, Jim (W Dorset)

  Monro, Sir Hector

  Spicer, Michael (S Worcs)

  Montgomery, Fergus

  Squire, Robin

  Moore, John

  Stanbrook, Ivor

  Morrison, Hon P. (Chester)

  Stanley, John

  Moynihan, Hon C.

  Stern, Michael

  Mudd, David

  Stevens, Lewis (Nuneaton)

  Murphy, Christopher

  Stevens, Martin (Fulham)

  Neale, Gerrard

  Stewart, Allan (Eastwood)

  Needham, Richard

  Stewart, Andrew (Sherwood)

  Nelson, Anthony

  Stewart, Ian (N Hertf'dshire)

  Neubert, Michael

  Stokes, John

  Newton, Tony

  Stradling Thomas, J.

  Nicholls, Patrick

  Sumberg, David

  Normanton, Tom

  Taylor, John (Solihull)

  Norris, Steven

  Taylor, Teddy (S'end E)

  Onslow, Cranley

  Tebbit, Rt Hon Norman

  Oppenheim, Philip

  Temple-Morris, Peter

  Osborn, Sir John

  Terlezki, Stefan

  Ottaway, Richard

  Thatcher, Rt Hon Mrs M.

  Page, John (Harrow W)

  Thompson, Donald (Calder V)

  Page, Richard (Herts SW)

  Thompson, Patrick (N'ich N)

  Parkinson, Rt Hon Cecil

  Thorne, Neil (Ilford S)

  Parris, Matthew

  Thornton, Malcolm

  Patten, Christopher (Bath)

  Thurnham, Peter

  Patten, John (Oxford)

  Townend, John (Bridlington)

  Pattie, Geoffrey

  Townsend, Cyril D. (B'heath)

  Pawsey, James

  Tracey, Richard

  Peacock, Mrs Elizabeth

  Trippier, David

  Percival, Rt Hon Sir Ian

  Trotter, Neville

  Pink, R. Bonner

  Twinn, Dr Ian

  Pollock, Alexander

  van Straubenzee, Sir W.

  Porter, Barry

  Vaughan, Dr Gerard

  Powell, William (Corby)

  Viggers, Peter

  Powley, John

  Waddington, David

  Prior, Rt Hon James

  Wakeham, Rt Hon John

  Proctor, K. Harvey

  Waldegrave, Hon William

  Raffan, Keith

  Walden, George

  Raison, Rt Hon Timothy

  Walker, Bill (T'side N)

  Rees, Rt Hon Peter (Dover)

  Walker, Rt Hon P. (W'cester)

  Rhodes James, Robert

  Waller, Gary

  Rhys Williams, Sir Brandon

  Walters, Dennis

  Ridley, Rt Hon Nicholas

  Ward, John

  Rifkind, Malcolm

  Wardle, C. (Bexhill)

  Roberts, Wyn (Conwy)

  Warren, Kenneth

  Robinson, Mark (N'port W)

  Watson, John

  Roe, Mrs Marion

  Watts, John

  Rossi, Sir Hugh

  Wells, John (Maidstone)

  Rost, Peter

  Wheeler, John

  Rowe, Andrew

  Whitfield, John

  Rumbold, Mrs Angela

  Whitney, Raymond

  Ryder, Richard

  Wiggin, Jerry

  Sackville, Hon Thomas

  Wilkinson, John

  Sainsbury, Hon Timothy

  Wolfson, Mark

  Sayeed, Jonathan

  Wood, Timothy

  Scott, Nicholas

  Woodcock, Michael

  Shaw, Giles (Pudsey)

  Yeo, Tim

  Shaw, Sir Michael (Scarb')

  Young, Sir George (Acton)

  Shelton, William (Streatham)

  Younger, Rt Hon George

  Shepherd, Colin (Hereford)

  Shepherd, Richard (Aldridge)

  Tellers for the Noes:

  Shersby, Michael

  Mr. Carol Mather and

  Silvester, Fred

  Mr. Robert Boscawen.

  Bill committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).
  Sir Paul Bryan (Boothferry): On a point of order, Mr. Speaker. I beg to move,
  That the right hon. and learned Member for Hexham (Mr. Rippon) be appointed a member of the Standing Committee.
  Mr. Rippon: Further to that point of order, Mr. Speaker. There is a danger that I might accept.
  Mr. Speaker: Order. I think that the right hon. and learned Gentleman would be a great asset, but I am not on the Committee of Selection.

  Rates Bill [Money]
  10.27 pm
  Queen's Recommendation having been signified—
  Motion made, and Question proposed,
  That, for the purposes of any Act resulting from the Rates Bill, it is expedient to authorise the payment out of moneys provided by Parliament of—

  (a) any administrative expenses incurred by the Secretary of State in consequence of that Act; and

  (b) any increase attributable to that Act in the sums payable out of such moneys under any other Act.—[Mr. Moore.]

  10.28 pm
  Mr. Ioan Evans: It is important that we should take every opportunity to express our opposition to this measure. I sat through the whole of the debate and, together with many hon. Members on both sides of the House, sought to speak to express the anxieties felt by our constituents and the county and district councils in our areas. It is regrettable that the House has not allowed time for this constitutional measure to be debated properly on the Floor of the House.
  Mr. Speaker: Order. To debate the money resolution is perfectly legitimate.
  Mr. Evans: I speak on the money resolution because I believe that we have today created a constitutional precedent, which Parliament will regret in the years ahead. It is regrettable, when we change the constitutional relationship between central and local government not only on finance but on other matters, that the issue is not debated on the Floor of the House.
  The legislation will be known as the Rate Act 1984, and the emphasis will be on "1984". The prediction made by George Orwell about 1984 is coming with this measure. Time and again Conservative Members have said that they believe in local democracy and that Whitehall is not the best judge. Big Brother, or Big Sister, will now be able to tell local authorities how much they can spend. The Bill has been foisted on Parliament by the Prime Minister herself who, in the discussion with Brian Walden on Sunday, had to admit to the nation that her Government have failed to curb public expenditure and taxation. Such an iniquitous measure, having been brought before the House, will be dealt with in Committee and rushed through the House, thereby changing a relationship that has existed and evolved between local authorities and Parliament since 1601. Local government as we know it will not be the same in the future.
  We must examine public expenditure. Local government has been far more successful than central Government in curbing public expenditure. The Prime Minister at Question Time today said that the cost of unemployment was about £5 billion. Estimates suggest that the loss to the Exchequer is nearer £17 billion. During the next three years, the Government are committed to spending £2 billion on the Falklands, which is far in excess of what the local authorities will spend throughout England and Wales if the Bill is not enacted. The Government have failed to reach their financial targets. The Bill restricts the rights of county and local councils.
  The Association of County Councils, which represents 37 of the 39 non-metropolitan counties in England and the eight Welsh county councils—which provide major
  264
  services to more than 30 million people — asks the House to consider rejecting the present proposal by refusing to give the Bill a Second Reading.
  That motion was put to the Association of County Councils, which comprises a majority of Conservative county councillors, and its verdict was 95 votes against the Bill, with only two county councillors, throughout the entire association, voting for the motion.
  It is interesting to note that those hon. Members who spoke against the Bill voted against it. Those hon. Members who entered the Lobby to vote for the Bill were hardly present throughout the debate.
  Mr. Richard Holt: The hon. Gentleman has referred to my hon. Friends who wished to speak and support the Government. It is not our fault that we did not catch Mr. Speaker's eye. New Members are not big enough to catch his eye.
  Mr. Speaker: Order. The hon. Gentleman must not say things like that.
  Mr. Evans: I say, as one who was not called in the debate, that you have been subjected to an unfair attack, Mr. Speaker. There were 75–100 Members who asked Mr. Speaker to call them during the debate, and that is another reason why the Bill should be considered in Committee on the Floor of the House. I understand the frustration of the hon. Member for Langbaurgh (Mr. Holt) at not being called during the debate on Second Reading. He will have to explain to the district councillors in his constituency and to his constituents that if he is not a member of the Committee he will have no say in the passing of a major constitutional measure. If he is frustrated in not being called, it is to the Government Front Bench that he should address his remarks and not to you, Mr. Speaker.
  Mr. Dennis Skinner: That is right. Parliamentary democracy is being ruined.
  Mr. Evans: The Association of Metropolitan Authorities stated:
  "This Bill should not be given a Second Reading. The Environment Committee of the Royal Commission should examine the issue. Failing that, this Bill should be remitted to a Select Committee so that evidence can be taken from those outside central and local government. The enormity of the Bill should not be underestimated."
  The association concluded:
  "A tax-raising power that has existed since 1601 should not be discarded in the space of a few months."
  That is why we should take advantage of the three quarters of an hour that is available to us for this debate.
  Mr. Skinner: That is right. We must use every second of it.
  Mr. Evans: The association represents six metropolitan counties, 36 metropolitan districts, 31 London boroughs and the GLC. I believe that the people of London will wish to see the continuation of the GLC when they read the reports of this debate. They will not support the Government's proposals to abolish it. Four of every 10 persons in England live in areas that are represented by the association.
  The district council in my constituency is represented by the Association of District Councils. The association is entirely opposed in principle to the provisions in parts I and II of the Bill, which contain both collective and general powers to limit the rates levied by local authorities. These provisions are, in some respects, more

  265
  alarming than the proposals in the White Paper on rates. They constitute a fundamental attack on the basis of local government.
  Labour, Liberal, SDP and Conservative councillors unanimously condemn the Bill. That condemnation extends throughout the Association of District Councils. The county councils, the district councils and the metropolitan councils are unanimous in their opposition to the Bill.
  The previous Secretary of State for the Environment, who is now the Secretary of State for Employment, had no doubt about the serious constitutional implications of rate-capping. On 8 July 1980, when he was a Minister in the previous Conservative Administration, he said:
  "There are things that one could do in local government and ways in which local government finance could be approached … which would substantially undermine the autonomy and freedom of action of local authorities. Some people have suggested imposing individual cash limits on every authority. That would be a very serious step indeed."—[Official Report, 8 July 1980, Vol. 988, c. 313.]
  Shortly after that, the right hon. Gentleman was shifted to another Department, and he now finds himself in the Department of Employment.
  The Bill relates to England and Wales, but on Second Reading only one Member representing a Welsh constituency was fortunate enough to catch the eye of the Chair. I express on behalf of all the local authorities in Wales—
  Mr. Stefan Terlezki: The hon. Gentleman does not.
  Mr. Evans: With the exception of the hon. Gentleman, who is a bit of a maverick in Wales, I speak on behalf of councillors of all political persuasions, who are all opposed to the measure. That is why I am speaking on the money resolution. The Government have in a ham-handed way forced the measure to be taken upstairs in Committee—
  Mr. Peter Hubbard-Miles: On the constitutional question, will the hon. Member for Cynon Valley (Mr. Evans) acknowledge that his constituency is situated in a county which refused to carry out its statutory duties under the civil defence legislation, ordered a civil defence headquarters to be demolished at considerable expense to the ratepayers and had to follow it up by reintroducing that headquarters? Was this refusal to carry out the statutory duties of local authorities not the original breach of the constitution?
  Mr. Evans: The Bill has nothing to do with that question. It does not affect the rates because civil defence comes under the Home Office.
  If we have local authorities, they should be allowed to make decisions. The people in Mid-Glamorgan will be answerable to the electors in Mid-Glamorgan when elections take place. That issue can be put before them. The hon. Member knows, and I know, that Wales has declared itself a nuclear-free zone, although there may be argument against it. Local authorities are disturbed about having to take home helps from elderly people, about having to close nursery schools and about having to sack teachers. It is nonsense to talk about building deep bunkers for a nuclear war that nobody will survive. That is irrelevant. It shows how much the Tory party is scraping the barrel in Wales to try to justify this interference with democracy.
  266
  If the Bill is going into Committee, I hope that the many Conservatives who have spoken, the majority of whom are opposed to the Bill, will be put on the Committee and will seek to minimise the damage that will be wrought by the Bill. When it gets to another place it may be thrown out.
  Mr. Holt: On a point of order, Mr. Speaker. I wish to apologise to you, Sir, if I have been wrong in my statement. Many of us are frustrated at having sat here for hours. I was pricked by the remark that none of us wished to speak. Many of us did. I apologise to you, Mr. Speaker.
  Mr. Speaker: I thank the hon. Gentleman. if he now wishes to make a contribution I will call him.
  10.42 pm
  Mr. Simon Hughes: Nobody is as frustrated as those on these Benches who have also sat through seven hours of debate and have only this last opportunity today to resist a preposterous, populist and unprincipled manoeuvre by the Government against the great bulk of elected representatives of not only their party but all parties. There are 2,000 Liberal councillors, some in control of authorities such as Richmond and the Isle of Wight, who know that nothing has been intended so fiercely to strike at the heart of the job they are elected to do as the manoeuvres of the Government in introducing a Bill which effectively begins to undermine local democracy up and down the land.
  Not only that, but what we have heard from the Government Front Bench today obscures truth, ignores reality and confuses the electorate. We must take this opportunity to ensure that we do not give the Government the money they claim they need to do something that they allege will save money but will probably do the opposite.
  One hundred years ago, Herbert Spencer said:
  "The function of Liberalism in the past was that of putting a limit to the powers of Kings. The function of true Liberalism in the future will be that of putting a limit to the powers of Parliaments."
  It is clear that the power of Parliament, and especially of the Executive, is growing daily and in a way that does not befit a Government who pretend that they are about devolving power and handing freedom back to the people.
  When, 80 years ago, there was a constitutional battle in Wales when the then Board of Education tried to interfere in the powers of local authorities over education, Lloyd George said:
  "It is a new idea in this country that a great Corporation or a County Council is just like a constable, whose business is to carry out orders from above, and liable to be cashiered for breach of discipline if he exercises any discretion."
  The resistance of those who believe that they are more in touch with the needs of local people on day-to-day issues will continue, partly because we realise how unprincipled the Government's stance is and how quickly they have completely changed sides.
  In 1974 the present Prime Minister moved a motion from the Opposition Benches and stressed the need for a fundamental reform of the rating system. She said that local authorities carried out their tasks better than Whitehall could perform them. In 1973, the present Secretary of State for the Environment said:
  "I would very much rather see Local Authorities have a fair degree of discretion and be prepared to take on their shoulders the full responsibility for their decisions rather than that they should become simply glorified agents for Whitehall."
  Why, with no justification, with paltry arguments and thinly veiled reasons for this about-turn, have the

  267
  Government found it so difficult to win the loyalty and respect of their Back Benchers, let alone the rest of the country? Perhaps the reasons are as follows. Although the Government want to make a step that will save money, the predictions in, for example, the Financial Times of last week suggest that the Government's plans to limit rate increases, far from curbing expenditure, will mean that the Treasury will be asked to find another £500 million in the first years of the new scheme.
  Moreover, it is surprising that the Government, like the Labour Government before them, were happy to continue to subsidise a large part of local government expenditure. My colleagues and I do not believe that that should be the case. We believe that money should be raised locally and spent locally. In that way there is accountability in local authorities' expenditure on behalf of local people. It is not possible to do what the Government have done —suddenly to reduce grants that have traditionally been provided by the Government and then to penalise those councils which are forced to increase rates or to increase their funds by turning to their electorates if they want to maintain services.
  In Bradford, for example, the cost to the ratepayer of the council continuing to spend £9 million is £15 million because of the Government's grant penalty. To the £9 million is added £6 million, simply because of an arbitrary formula that is so ineffective and badly thought out that it has had to be adjusted regularly by people in Whitehall who do nothing other than play with figures and have no occasion to deal with what is really happening throughout the country.
  Another example is Avon, a Tory-controlled authority that has made strong representations—[HON. MEMBERS: "What?"] It is a Labour-controlled authority. I am sorry. It has made strong representations to Tories in the area saying that between 1974–75 and 1983–84 total spending in terms of real service provision rose by only 6 per cent., but it reached its highest level when the Tories were in control. Since then, less than 10 per cent. of its budget being discretionary and the rest being imposed on it by the Government by way of legislative direction, it has been forced to increase the amount that it has to charge the citizens fivefold in 10 years. It is being penalised for spending money on services such as nursery schools and educational classes. At the same time one of the Tory Members of Parliament is urging the local authority to spend more money on things such as computer education. If Avon had received the same level of rate support grant as the Tory administration did in 1979–80, it could have reduced its county rate by 8 per cent.
  Cheshire has no overall majority of any party. Cuts in grant have raised rates by 26·7 per cent., without an increase in services. Information about increases that the local authority has had to make shows that since 1979 £2 million has been obligatorily spent by it because of Government directives. It has incurred penalties because of that.
  Essex, the Isle of Wight and many other authorities have a grant-related expenditure figure that is considerably adrift from the target figure, both imposed by the Government and both showing the ridiculous way in which arbitrary figures determine the effect of local government expenditure. The same pattern is repeated up and down the land.
  268
  The Bill that brings this muddle to a head is a miserable effort. We have only to look at some of the provisions to see how badly drafted and how ill thought out it is and how difficult it will be to implement. For example, clause 2(2) (b) states that the Secretary of State can penalise authorities if their expenditure appears
  "excessive having regard to general economic conditions."
  That is even if the figure is less than £10 million or the GREA. The Secretary of State has the power under clause 3(4) to seek information in the event of an appeal by an authority against the Government's assessment. We do not know what sort of information it will be, how long it will take to acquire, what the work load is likely to be—
  Mrs. Elaine Kellett-Bowman: On a point of order, Mr. Speaker. The speech of the hon. Member for Southwark and Bermondsey (Mr. Hughes) seems to be related singularly little to the money resolution.
  Mr. Speaker: The hon. Member for Southwark and Bermondsey (Mr. Hughes) is straying a little wide of the money resolution. I hope that he will bear it in mind that other hon. Members wish to take part in the debate.
  Mr. Hughes: The whole point of my examples, such as the clause with which I am dealing, is that the Government are asking permission of the House to have money expended when the provisions of the Bill do not specify in any way what the financial implications will be, not only for the Government but for the local authorities, the work loads of which could be considerably increased, in a way that they cannot begin to contemplate. They have had no guidance either in the White Paper or in the Bill.
  This is another directly financial matter. Under clause 4 the Secretary of State may take into account any reserves held by an authority. Does that include housing account balances? Does it include other reserves that the authority has been directed to accumulate? Again, clause 8 involves totally unspecific additional powers with financial implications that are also totally unspecified.
  In effect, the Government are asking for a complete power—not just the general and specific powers that we have been debating, but an open cheque—to interfere, in a way that is not at all clear to hon. Members, during the next three or four years of their terms of office in the affairs of every local authority in the land.
  There is another problem, and it involves timetabling. An enormous number of steps will need to be taken by local authorities before Parliament is called on—if it is called on—to exercise its decisions by affirmative resolution—and no more—on the specific additional powers that are sought. That could take months, if not years. It is difficult enough for responsible members of all parties in local authorities who are trying to do their best, with reduced powers and facilities, to do the work that they are already doing voluntarily and in their spare time, without the timetabling that will inevitably mean spending considerably more time in dealing with the mandarins and bureaucrats of Marsham street.
  The fundamental problem is that the finance that the Government seek for this monstrous new proposal is based on the uncertainty of the GREA and the uncertainty of assessments as a basis for setting targets. The distortion to which that is susceptible has been apparent over the years. My party realises that the Government are taking this step only because they have refused to face the need for fundamental reform. The sterility of ideas, recognised by both sides—
  Mrs. Kellett-Bowman: On a point of order, Mr. Speaker. I wonder whether the hon. Gentleman would care to read the money resolution, because what he is saying does not relate to it at all.
  Mr. Speaker: I am listening carefully to the hon. Gentleman. I say to him again—he heard me earlier—that about 76 hon. Members wish to take part in this debate, and he has had a fair share of it.
  Mr. Hughes: I was on the last point, which I hope hon. Members will accept is directly relevant to the financing of the Bill.
  If the Government had come to the House with a measure to reform local government finance we should have known what the figures would have been, and perhaps we should have been happy to give them the authority to go ahead without controversy and opposition. However, that has not happened. I have read the money resolution several times, and it is as open-ended as any that I have seen in the time that I have been in the House. We are faced with something that does nothing more than confuse the financing of both local government and the public sector generally and is liable to lead the country to spend an enormous amount of wasted money on a muddled scheme which the Government will regret from the moment they introduce it—if it gets through.
  We intend—together, I believe, with members of all other parties—to make sure at every stage of the Bill's progress that the Government's proposals are shown to be the shallow, ill-conceived and anti-democratic proposals that they are generally accepted outside the House to be. Populism is not enough. The Government should be responsible not only for their finances but for ours. They have failed in their duty, and we shall remind them of that until they have to change course.
  Mr. Speaker: Order. I must remind the House that this debate comes to an end at 14 minutes past 11, and the Minister would like five minutes in which to wind up.
  10.59 pm
  Mr. Richard Holt: We have had a long day's debate on the subject of local government and rates. My experience is almost unique in the House. I served an apprenticeship of 10 years on the council of the London borough of Brent, and then served on a county council that has been put to us today as a pillar of Toryism—Buckinghamshire. In those 20 years, I have had sufficient experience to make a small contribution to the debate.
  The point that is often made about local democracy is bogus, because in a county such as Buckinghamshire there is nothing very local if one represents a ward in the south which is 70 miles away from a ward in the north about which one has no knowledge. It is as bogus to suggest that the people locally know what it is for which they are voting as it is to say that the Government do not have an overall responsibility—they do. I am delighted that in the debate on the money element of the Bill it has been clearly identified by all Opposition Members, irrespective of their party, that they are not in favour of assisting the ratepayers but are happy for them to be bled and bled again.
  In the constituency of Langbaurgh, which I have the honour to represent, we have high unemployment. I recently carried out an exercise to compare it with the area that I used to represent at the local level. An industrialist in Langbaurgh pays nine times as much in rates as does
  270
  an industrialist in Wyckham. Such a rate burden is why it is necessary for the Government to step in. What is the council spending the money on in Langbaurgh? Something worthy and good—an aviary costing £55,000 in revenue costs alone. That is the sort of spendthrift nonsense that we have had to put up with.
  I am not proud of the local so-called Tory leadership in Buckinghamshire. The chairman and leader of that county council is far removed from the reality of Conservatism. He does not follow it much, but that county council has been used today as an example of Tories against rate-capping. It is suggested that the county council knows better because it is local. In Wyckham, which is not local when one gets up to the district level, we wished to alter the charges for car parking. Who knew best? Buckinghamshire county council, Big Brother. It is just as much guilty—
  Mr. Stephen Ross: What does this have to do with the money resolution, Mr. Speaker?
  Mr. Speaker: Order. Imagine that this is a preliminary. The debate has been fairly wide-ranging, and the hon. Member for Isle of Wight (Mr. Ross) will accept that that has been true of an hon. Member from his party.
  Mr. Holt: What I am saying has about as much relevance to the money resolution as what the hon. Member for Southwark and Bermondsey (Mr. Hughes) had to say.
  Mr. Speaker: Order. The hon. Gentleman should not follow that line too far.
  Mr. Holt: Thank you, Mr. Speaker, for your advice.
  I did not anticipate being called this evening and have left my notes behind, and am therefore speaking from memory. One or two things that stick in my mind concern money, and that is the real thing for the ratepayers. In Langbaurgh, it costs £1 million more of real money to collect the rents than it does in Wyckham. Such administrative mayhem must be stopped. We need to have the money that we shall be voting this evening to ensure that Parliament saves the wasting of ratepayers' money by counties such as Cleveland, Langbaurgh and Buckinghamshire, so that the people will remember when it comes to elections that only the Conservative party was prepared to do anything to stop the waste of ratepayers' money.
  11.4 pm
  Mr. Dave Nellist: In referring to the money resolution and opposing the authorisation of expenditure of administrative moneys in the Bill, I shall bring the House back to the real world. I spend an inordinate amount of time at surgeries when families knock on my door. People write to me and phone me about damp houses and the fact that they cannot find somewhere decent in which to live in Coventry or have been 10 or 12 years on a waiting list for a new council house. I must explain to them that since 1976, and especially since 1979, because of the salami tactics of the Government's slicing of local authority finance, any housing for them is extremely limited.
  The city council has backed up this point by writing to me explaining that for the past two years it has built no houses and that for the next three years it cannot budget to build any houses. The council has added that to modernise public housing in Coventry to an acceptable

  271
  safe and healthy standard would take at least 30 years on the present grants. When the council applies to the Government for money, it receives a third of its application. That is the real world of local authority spending.
  It may be convenient for Ministers and those hon. Members who talk among themselves during debate to concentrate on the fringe activities among one or two councils. But this measure and the previous cuts by this Government have exacerbated the problems of ordinary working people when social services, housing and education are failing. It is a fallacy for the Minister to sum up in a speech that was as exciting as watching wood warp and to try to con people that the Government are taking control of local authority spending. This measure is simply a book transfer. Money is taken from the hands of working people at a local level to fund 5 million people who are on the dole because of the Tory Government's policies.
  A figure of £10,000 million has been mentioned by several hon. Members today. Since 1976, I have always opposed my local authority raising rates to compensate for the cuts in money from central Government. There is a battle between local and central Government because of the Government's cuts.
  This Bill, in which we are asked to authorise expenditure through a money resolution, is a much wider attack. The Secretary of State, who would not answer interventions eight hours ago and managed to absent himself from the debate, was heard on the radio during the past four weeks complaining that a large number of councils raise most of their money from industrial and commercial ratepayers. He complains that those people have no votes. What rubbish! That action shows that the Secretary of State and the rest of the Cabinet never allow facts to conflict with their prejudices.
  Business men and bosses have votes as individuals in the areas in which they live. Workers who create the wealth in the factories and workplaces that the business men and bosses lord over have votes where they live. The Secretary of State is asking us to set the stage to give more than one vote to those who contribute industrial and commercial rates. It would be laughable for him to suggest that business is under-represented. We can add up all the company directorships of Tory Members on the Register of Members' Interests to see how many business men are represented in the House.
  The Under-Secretary of State for the Environment wrote me a letter after I had asked about the councils for which the majority of the money raised came from disfranchised industrial and commercial ratepayers. In Scotland there are three, two of which are Shetland and Orkney which have special relationships because of oil. That is 5 per cent. of local authorities in Scotland. In Wales there are five, or 14 per cent. In England there are 29, or 8 per cent. That adds up to 37 councils out of more than 400—less than 8 per cent.—in which most of the rating funds come from the mythical disfranchised majority of industrial and commercial ratepayers. The best example—fortunately this arrived just before 7 o'clock this evening—is Northern Ireland. Ministers make great play of the poverty and penury of businesses, in which jobs are at risk due to high rates bills. They say that high rates cause unemployment and jobs go out of the window. Industrial premises in Northern Ireland are 100 per cent.
  272
  derated, so the area which most closely conforms with the logic of the Bill has the highest unemployment in the country.
  Ministers talk about cutting rates for people in this country and camouflage their true intentions by talking about the accountability of local authorities. If they really want to cut the rates, there is a very simple way to do so. Local authorities now owe £36,000 million to banks and other financial institutions in Britain and abroad in loans and debt charges. That figure has increased by £6,000 million in the past four years—a sum far greater than the so-called overspending of which Ministers have complained today. Coventry owes £200 million to the banks. That has increased every year since the early 1900s when the debt was first launched and there is no way in which Coventry can repay it. The Tories managed to wipe out billions of pounds in debt for British Steel and the rest when they wanted to re-rig the books. If they want to save ratepayers money, let them cancel Coventry's outstanding debt. We could then halve the domestic rate and still have £12 million to £15 million extra per year to spend on the damp houses which I referred to earlier. If the Government would do that throughout the country, it would be a real deal for ratepayers, domestic and otherwise, and for the working people whom we represent.
  11.12 pm
  The Under-Secretary of State for the Environment (Mr. William Waldegrave): I wish briefly to address the money resolution itself.
  The first part deals with the administrative costs for central Government in implementing the rate limitation proposals. We expect there to be savings overall in central Government manpower, principally because the new rating procedures outlined in paragraphs 9 to 16 of schedule 1 will provide staff savings in the valuation office. We estimate, however, that there will be additional administrative costs overall arising from the Bill because of the higher grades of staff required for implementation of rate limitation. Under the selective scheme we estimate those overall additional costs to be about £250,000 per year net. If a move to general rate limitation ever became necessary, the costs would no doubt be higher, given the greater number of local authorities involved, but at present this is an unquantifiable cost and would be much less than the general reduction in local authorities' spending.
  The second part of the resolution is designed principally to deal with the cost of additional Exchequer grants to local government for rating relief for properties partly used for the disabled. The extension of eligibility for rate relief to institutions used predominantly but not wholly for the purposes of the Rating (Disabled Persons) Act 1978 is a proposal which I am sure that the House will readily endorse. It is likely to increase the amounts paid out under that Act as 90 per cent. of the cost of the relief given will be reimbursed to local authorities by the Exchequer. It is not possible to say how much is likely to be spent through this increased eligibility since much will depend on the number of institutions successfully claiming relief under the new provisions.
  I invite the House to support the resolution.
  It being three quarters of an hour after the commencement of proceedings on the motion, MR. SPEAKER put the Question pursuant to Standing Order No. 3 (Exempted business).
  The House divided: Ayes 333, Noes 98.

  Division No. 125]

  [11.15 pm

  AYES

  Adley, Robert

  Evennett, David

  Alexander, Richard

  Eyre, Reginald

  Alison, Rt Hon Michael

  Fallon, Michael

  Amess, David

  Farr, John

  Ancram, Michael

  Favell, Anthony

  Arnold, Tom

  Fenner, Mrs Peggy

  Ashby, David

  Finsberg, Geoffrey

  Aspinwall, Jack

  Fookes, Miss Janet

  Atkins, Rt Hon Sir H.

  Forman, Nigel

  Atkins, Robert (South Ribble)

  Forsyth, Michael (Stirling)

  Atkinson, David (B'm'th E)

  Forth, Eric

  Baker, Kenneth (Mole Valley)

  Fowler, Rt Hon Norman

  Baker, Nicholas (N Dorset)

  Franks, Cecil

  Baldry, Anthony

  Fraser, Peter (Angus East)

  Banks, Robert (Harrogate)

  Freeman, Roger

  Batiste, Spencer

  Fry, Peter

  Bellingham, Henry

  Gale, Roger

  Bendall, Vivian

  Galley, Roy

  Bennett, Sir Frederic (T'bay)

  Gardiner, George (Reigate)

  Berry, Sir Anthony

  Gardner, Sir Edward (Fylde)

  Best, Keith

  Garel-Jones, Tristan

  Bevan, David Gilroy

  Glyn, Dr Alan

  Biffen, Rt Hon John

  Goodhart, Sir Philip

  Biggs-Davison, Sir John

  Goodlad, Alastair

  Bonsor, Sir Nicholas

  Gorst, John

  Bottomley, Peter

  Gow, Ian

  Bowden, A. (Brighton K'to'n)

  Gower, Sir Raymond

  Bowden, Gerald (Dulwich)

  Grant, Sir Anthony

  Boyson, Dr Rhodes

  Greenway, Harry

  Braine, Sir Bernard

  Gregory, Conal

  Brandon-Bravo, Martin

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

  Bright, Graham

  Griffiths, Peter (Portsm'th N)

  Brinton, Tim

  Grist, Ian

  Brittan, Rt Hon Leon

  Ground, Patrick

  Brooke, Hon Peter

  Grylls, Michael

  Brown, M. (Brigg & Cl'thpes)

  Gummer, John Selwyn

  Bruinvels, Peter

  Hamilton, Hon A. (Epsom)

  Bryan, Sir Paul

  Hamilton, Neil (Tatton)

  Buchanan-Smith, Rt Hon A.

  Hampson, Dr Keith

  Buck, Sir Antony

  Hanley, Jeremy

  Budgen, Nick

  Hannam, John

  Bulmer, Esmond

  Hargreaves, Kenneth

  Burt, Alistair

  Harris, David

  Butcher, John

  Harvey, Robert

  Butler, Hon Adam

  Haselhurst, Alan

  Butterfill, John

  Havers, Rt Hon Sir Michael

  Carlisle, John (N Luton)

  Hawkins, C. (High Peak)

  Carlisle, Kenneth (Lincoln)

  Hawkins, Sir Paul (SW N'folk)

  Carttiss, Michael

  Hawksley, Warren

  Chalker, Mrs Lynda

  Hayes, J.

  Channon, Rt Hon Paul

  Hayhoe, Barney

  Chapman, Sydney

  Hayward, Robert

  Chope, Christopher

  Heathcoat-Amory, David

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

  Heddle, John

  Clark, Dr Michael (Rochford)

  Henderson, Barry

  Clark, Sir W. (Croydon S)

  Heseltine, Rt Hon Michael

  Clarke Kenneth (Rushcliffe)

  Hickmet, Richard

  Clegg, Sir Walter

  Higgins, Rt Hon Terence L.

  Cockeram, Eric

  Hill, James

  Colvin, Michael

  Hind, Kenneth

  Conway, Derek

  Hirst, Michael

  Coombs, Simon

  Hogg, Hon Douglas (Gr'th'm)

  Cope, John

  Holt, Richard

  Corrie, John

  Hooson, Tom

  Couchman, James

  Hordern, Peter

  Cranborne, Viscount

  Howard, Michael

  Crouch, David

  Howarth, Alan (Stratf'd-on-A)

  Currie, Mrs Edwina

  Howarth, Gerald (Cannock)

  Dickens, Geoffrey

  Howe, Rt Hon Sir Geoffrey

  Dicks, T.

  Howell, Ralph (N Norfolk)

  Dorrell, Stephen

  Hubbard-Miles, Peter

  Douglas-Hamilton, Lord J.

  Hunt, David (Wirral)

  Dover, Denshore

  Hunt, John (Ravensbourne)

  Dunn, Robert

  Hunter, Andrew

  Durant, Tony

  Hurd, Rt Hon Douglas

  Edwards, Rt Hon N. (P'broke)

  Irving, Charles

  Eggar, Tim

  Jackson, Robert

  Emery, Sir Peter

  Jenkin, Rt Hon Patrick

  NOES

  Alton, David

  Dixon, Donald

  Ashdown, Paddy

  Dormand, Jack

  Barnett, Guy

  Dubs, Alfred

  Barron, Kevin

  Eastham, Ken

  Beggs, Roy

  Evans, Ioan (Cynon Valley)

  Bennett, A. (Dent'n & Red'sh)

  Evans, John (St. Helens N)

  Bermingham, Gerald

  Fatchett, Derek

  Bray, Dr Jeremy

  Fields, T. (L'pool Broad Gn)

  Brown, Gordon (D'f'mline E)

  Forsythe, Clifford (S Antrim)

  Brown, N. (N'c'tle-u-Tyne E)

  Foster, Derek

  Bruce, Malcolm

  Foulkes, George

  Callaghan, Jim (Heyw'd & M)

  Freeson, Rt Hon Reginald

  Carlile, Alexander (Montg'y)

  Freud, Clement

  Clarke, Thomas

  Godman, Dr Norman

  Cocks, Rt Hon M. (Bristol S.)

  Golding, John

  Cohen, Harry

  Harrison, Rt Hon Walter

  Cook, Frank (Stockton North)

  Haynes, Frank

  Cook, Robin F. (Livingston)

  Hogg, N. (C'nauld & Kilsyth)

  Corbyn, Jeremy

  Home Robertson, John

  Cowans, Harry

  Howells, Geraint

  Craigen, J. M.

  Hoyle, Douglas

  Cunliffe, Lawrence

  Hughes, Sean (Knowsley S)

  Cunningham, Dr John

  Hughes, Simon (Southwark)

  Dalyell, Tam

  Johnston, Russell

  Davies, Ronald (Caerphilly)

  Jones, Barry (Alyn & Deeside)

  Jessel, Toby

  Peacock, Mrs Elizabeth

  Johnson-Smith, Sir Geoffrey

  Percival, Rt Hon Sir Ian

  Jones, Gwilym (Cardiff N)

  Pollock, Alexander

  Jones, Robert (W Herts)

  Powell, William (Corby)

  Jopling, Rt Hon Michael

  Powley, John

  Joseph, Rt Hon Sir Keith

  Prior, Rt Hon James

  Kellett-Bowman, Mrs Elaine

  Raffan, Keith

  Key, Robert

  Raison, Rt Hon Timothy

  King, Roger (B'ham N'field)

  Rees, Rt Hon Peter (Dover)

  King, Rt Hon Tom

  Rhodes James, Robert

  Knight, Gregory (Derby N)

  Rhys Williams, Sir Brandon

  Knight, Mrs Jill (Edgbaston)

  Ridley, Rt Hon Nicholas

  Knowles, Michael

  Rifkind, Malcolm

  Lamont, Norman

  Roberts, Wyn (Conwy)

  Lang, Ian

  Robinson, Mark (N'port W)

  Lawler, Geoffrey

  Roe, Mrs Marion

  Lawrence, Ivan

  Rowe, Andrew

  Lawson, Rt Hon Nigel

  Rumbold, Mrs Angela

  Lee, John (Pendle)

  Ryder, Richard

  Leigh, Edward (Gainsbor'gh)

  Sackville, Hon Thomas

  Lennox-Boyd, Hon Mark

  Sainsbury, Hon Timothy

  Lewis, Sir Kenneth (Stamf'd)

  Sayeed, Jonathan

  Lilley, Peter

  Scott, Nicholas

  Lloyd, Ian (Havant)

  Shaw, Giles (Pudsey)

  Lloyd, Peter, (Fareham)

  Shaw, Sir Michael (Scarb')

  Lord, Michael

  Shelton, William (Streatham)

  Luce, Richard

  Shepherd, Colin (Hereford)

  Lyell, Nicholas

  Shersby, Michael

  McCrindle, Robert

  Silvester, Fred

  McCurley, Mrs Anna

  Sims, Roger

  Macfarlane, Neil

  Skeet, T. H. H.

  MacGregor, John

  Smith, Sir Dudley (Warwick)

  MacKay, Andrew (Berkshire)

  Smith, Tim (Beaconsfield)

  MacKay, John (Argyll & Bute)

  Soames, Hon Nicholas

  Maclean, David John.

  Speller, Tony

  Madel, David

  Spence, John

  Major, John

  Spencer, D.

  Maples, John

  Spicer, Jim (W Dorset)

  Marland, Paul

  Spicer, Michael (S Worcs)

  Marlow, Antony

  Squire, Robin

  Marshall, Michael (Arundel)

  Stanbrook, Ivor

  Mates, Michael

  Stanley, John

  Maude, Francis

  Stern, Michael

  Mawhinney, Dr Brian

  Stevens, Lewis (Nuneaton)

  Mayhew, Sir Patrick

  Stevens, Martin (Fulham)

  Mellor, David

  Stewart, Allan (Eastwood)

  Merchant, Piers

  Stewart, Andrew (Sherwood)

  Miller, Hal (B'grove)

  Stewart, Ian (N Hertf'dshire)

  Mills, Iain (Meriden)

  Stokes, John

  Mills, Sir Peter (West Devon)

  Stradling Thomas, J.

  Miscampbell, Norman

  Sumberg, David

  Mitchell, David (NW Hants)

  Tapsell, Peter

  Moate, Roger

  Taylor, John (Solihull)

  Monro, Sir Hector

  Taylor, Teddy (S'end E)

  Montgomery, Fergus

  Tebbit, Rt Hon Norman

  Moore, John

  Temple-Morris, Peter

  Morrison, Hon P. (Chester)

  Terlezki, Stefan

  Moynihan, Hon C.

  Thatcher, Rt Hon Mrs M.

  Mudd, David

  Thompson, Donald (Calder V)

  Murphy, Christopher

  Thompson, Patrick (N'ich N)

  Neale, Gerrard

  Thorne, Neil (Ilford S)

  Needham, Richard

  Thornton, Malcolm

  Nelson, Anthony

  Thurnham, Peter

  Neubert, Michael

  Townend, John (Bridlington)

  Newton, Tony

  Townsend, Cyril D. (B'heath)

  Nicholls, Patrick

  Tracey, Richard

  Normanton, Tom

  Trippier, David

  Norris, Steven

  Trotter, Neville

  Onslow, Cranley

  Twinn, Dr Ian

  Oppenheim, Philip

  van Straubenzee, Sir W.

  Osborn, Sir John

  Vaughan, Dr Gerard

  Ottaway, Richard

  Viggers, Peter

  Page, John (Harrow W)

  Waddington, David

  Page, Richard (Herts SW)

  Wakeham, Rt Hon John

  Parkinson, Rt Hon Cecil

  Waldegrave, Hon William

  Parris, Matthew

  Walden, George

  Patten, Christopher (Bath)

  Walker, Bill (T'side N)

  Patten, John (Oxford)

  Walker, Rt Hon P. (W'cester)

  Pattie, Geoffrey

  Waller, Gary

  Pawsey, James

  Ward, John

  Wardle, C. (Bexhill)

  Wolfson, Mark

  Warren, Kenneth

  Wood, Timothy

  Watson, John

  Woodcock, Michael

  Watts, John

  Yeo, Tim

  Wells, John (Maidstone)

  Young, Sir George (Acton)

  Wheeler, John

  Younger, Rt Hon George

  Whitfield, John

  Whitney, Raymond

  Tellers for the Ayes:

  Wiggin, Jerry

  Mr. Carol Mather and

  Wilkinson, John

  Mr. Robert Boscawen.

  Winterton, Mrs Ann

  Kaufman, Rt Hon Gerald

  Rogers, Allan

  Kennedy, Charles

  Rooker, J. W.

  Kirkwood, Archibald

  Ross, Stephen (Isle of Wight)

  Lambie, David

  Ross, Wm. (Londonderry)

  Leadbitter, Ted

  Skinner, Dennis

  Lewis, Terence (Worsley)

  Smith, C.(Isl'ton S & F'bury)

  Litherland, Robert

  Smith, Cyril (Rochdale)

  Lloyd, Tony (Stretford)

  Smith, Rt Hon J. (M'kl'ds E)

  Loyden, Edward

  Speed, Keith

  McDonald, Dr Oonagh

  Steel, Rt Hon David

  McKay, Allen (Penistone)

  Stott, Roger

  McTaggart, Robert

  Straw, Jack

  McWilliam, John

  Thomas, Dafydd (Merioneth)

  Madden, Max

  Thomas, Dr R. (Carmarthen)

  Maginnis, Ken

  Torney, Tom

  Marshall, David (Shettleston)

  Wallace, James

  Maxton, John

  Wardell, Gareth (Gower)

  Michie, William

  Wareing, Robert

  Nellist, David

  Wigley, Dafydd

  O'Neill, Martin

  Winnick, David

  Parry, Robert

  Wrigglesworth, Ian

  Penhaligon, David

  Young, David (Bolton SE)

  Pike, Peter

  Powell, Raymond (Ogmore)

  Tellers for the Noes:

  Prescott, John

  Mr. A. J. Beith and

  Redmond, M.

  Mr. Michael Meadowcroft.

  Question accordingly agreed to.
  Resolved,
  That, for the purposes of any Act resulting from the Rates Bill, it is expedient to authorise the payment out of moneys provided by Parliament of—

  (a) any administrative expenses incurred by the Secretary of State in consequence of that Act; and

  (b) any increase attributable to that Act in the sums payable out of such moneys under any other Act.

  New Towns (Borrowing)
  11.27 pm
  The Under-Secretary of State for the Environment (Sir George Young): I beg to move,
  That the New Towns (Limit on Borrowing) Order 1983, dated 12th December 1983, a copy of which was laid before this House on 20th December, be approved.
  The House will recall that in early 1982 Parliament debated and passed the New Towns Act 1982. That allowed new town corporations in England, Scotland and Wales to continue borrowing from the national loans fund to finance their programmes, up to an aggregate figure of principal outstanding of £4,500 million or such larger sum, not exceeding £5,000 million, as the House of Commons should by order specify.
  The towns are now collectively approaching the £4,500 million limit, and without this order they would probably reach the limit in March. The order is therefore necessary now to allow them to complete their development programme without interruption. As has been the practice on previous occasions, it will take up the whole of the extra £500 million available under the 1982 Act. We expect this further £500 million to last until early 1986.
  When the borrowing powers were extended in 1982 we expected that the whole £1,000 million would last only a couple of years. In fact, as we see, the first £500 million has itself lasted two years—and the second £500 million will probably last another two. This is because of the towns' excellent performance in achieving industrial, commercial and housing receipts. Since 1979 the English towns alone have sold £600 million worth. The Government have also succeeded in reducing interest rates substantially, which means that towns have had to borrow less than expected to roll over existing debt.
  The House will wish to know how the further £500 million will be spent. The new towns programme is, of course, moving towards its conclusion. But there still remains important work to be done, to round off the towns and ensure that they are complete and viable communities. So the money will go, for example, on completing the infrastructure for Milton Keynes' city centre, on essential road schemes such as central Lancashire's western primary road, on shared ownership and other low-cost home ownership initiatives on which the new towns have led the way, and on the basic infrastructure needed to encourage the private sector to continue with the factories, offices and houses necessary for a successful new town. In addition, under the present new town financial regime, some will be used to finance the interim revenue deficits of the development corporations.
  I should like to take this opportunity to say a little bit more about what we are achieving under each of these heads.
  First, on housing, I think that hon. Members on both sides will agree that the achievements by new towns on shared ownership, starter homes and similar low cost initiatives have been outstanding. They have developed excellent relationships with private developers, to produce the houses people want, at prices they can afford. By 31 March 1984 the new towns in England will have promoted over 4,000 sales on a shared ownership basis; and over 5,000 houses a year are being built by private developers under licence on new town land, many for starter homes.
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  Nor must we overlook the biggest single element in our home ownership drive—sales to sitting tenants. Again, new towns have set the pace. By 30 September they had sold more than 15,000 houses to their tenants, so almost one in five new town tenants now own their homes. A further 3,000 sales are in the pipeline. This has had a dramatic effect, for the better, in all towns.
  In the past, new town development has relied too much on rented housing, but the demand for home ownership was there. As recent surveys have shown, for most people their ambition is to own their home. This demand was not being met. Now, prompted by the Government and implemented efficiently by the new towns, it is. My visits to new towns have shown me the new interest in the area which has been generated by the spread of home ownership.
  Opposition Members may try to argue that that has been at the expense of rented housing and that there is a need for such accommodation. The answer is that there remains, even after sales, a substantial stock of rented property available to meet all those needs. What corporations are doing now, through sales, development and provision of sites to the private sector, is what is necessary to achieve and maintain the right balance of private and publicly owned property in the new towns.
  I should like to move on from that to transfer of housing and of community-related assets. First, we have sorted out the problems associated with defects in the housing transferred last time round: appropriate grants are now being made to the local authorities concerned, although one authority is still challenging the position. Secondly, we are making good progress with further transfers. Corporations are doing all that they can to ensure that the housing stock is in good condition and ready for transfer.
  We have produced financial arrangements which, broadly speaking, allow the local authority concerned to inherit the subsidy that the new town corporation would have received had it retained the houses. This ensures that transfers will not put a financial burden upon the recipient authority. Indeed, the prospects of raising further capital receipts from the transferred stock should make transfer a good bargain. Directions have now been issued at Redditch and Skelmersdale, and I hope that they will soon be issued at Basildon, Northampton and Washington, with a view to transfer on 1 April 1985.
  We have reached agreed arrangements for the transfer to the district council of community-related assets in four new towns. Discussions are now under way at a further 10 new towns on such a transfer. Again, we have been able to agree financial terms which are broadly neutral in their effect. As with housing transfer, this is an important milestone in the life of a new town, marking the point at which the local authority can appropriately inherit these assets and the associated responsibilities.
  I will return shortly to other matters relating to the winding up of new towns, but I should like to pay tribute to the continuing achievement of the new towns in creating employment. Over the past few years they have sustained the remarkable performance of creating 20,000 or so new jobs a year—a vital contribution to the welfare of their own communities and, indeed, to their regions. Examples that come to mind are the Hitachi-Maxell, Ricoh and Unimation developments at Telford—generating over 500 jobs—and the Motorola expansion at East Kilbride—a £60 million investment generating 800 jobs. As with housing, this is being achieved through a fruitful

  279
  partnership between corporations and the private sector. Typically, the corporation provides the basic infrastructure, including the actual site; and the private firm which will occupy it then puts up its own building and fits it out, or the corporation works in partnership with a financial institution, through a lease and lease-back arrangement.
  A good example is Basildon's £50 million town centre development, mentioned earlier today in a significant maiden speech by my hon. Friend the Member for Basildon (Mr. Amess). That development is being done in partnership with Norwich Union. In these ways we achieve so much more, for a given input of public money, than we could if, as Opposition Members sometimes suggest, corporations had to build everything with public money.
  I should like to turn now to a specifically financial matter, which I know is of interest to hon. Members on both sides. Hon. Members will recall that, we have been reviewing the method by which the English new towns finance their programmes, in the light of the large deficits now being run by the second and third generation towns. That problem built up in England throughout the 1970s, and a wide range of factors were responsible.
  Among those factors were high levels of interest rates in the 1970s, the new financial system for building roads following the introduction of the transport supplementary grant in 1975, the system of undue burden payments introduced in 1976, the change in the property market that resulted in developers retaining a smaller surplus, and the less favourable location of many of the second and third generation new towns.
  We decided that the best approach was, first, to stabilise the position. That we have done by suspending £1,185 million of outstanding national loans fund debt. The power to do that was contained in section 45 of the Finance Act 1983. The order, detailing the individual loans to be suspended, was made on 12 September 1983. Though suspended, the loans continue to count against the borrowing limit, so they are included within the £4,500 million total.
  That suspension lasts until 1 October 1986, so it gives us the necessary breathing space. But we are not, of course, letting matters rest there. As we have indicated to the House, we intend to produce a permanent solution as part of the measures we will need to take to deal with the final winding up of towns. We will keep the House fully informed of the progress we make on that.
  That leads back to the important issue of winding up. I have already referred to the progress we are making both on housing and on the transfer of community-related assets. The new towns have reduced their staff by 30 per cent. since 1979—an excellent achievement. We have taken an important step forward in our decision, which I announced last July in reply to a question from my hon. Friend the Member for Welwyn Hatfield (Mr. Murphy), to wind up the eight development corporations with target dates in 1984 and 1985, using the Commission for the New Towns.
  That has given all those towns a degree of certainty about their future, enabling them, and the local authorities concerned, to plan their winding up smoothly and efficiently. That is obviously in everyone's interest. The actual date for dissolution cannot, of course, be settled
  280
  until the statutory processes have been gone through. However, I hope that it will be possible broadly to adhere to the target dates we have announced.
  Certainly I can assure hon. Members that we have no intention of keeping development corporations in existence any longer than they are necessary. We have now started the formal processes in the cases of Redditch and Skelmersdale, and I expect soon to see the same step taken elsewhere.
  I should mention a matter that I know is of concern to the hon. Member for Easington (Mr. Dormand) and to other hon. Members representing the north-east—the question of the future of the north-east new towns. When we last debated that matter I promised the hon. Member for Easington that we would review the position of those towns. I can confirm tonight that the review is under way. We will, of course, take full account of what all three towns have achieved in the way of creating new jobs, their role as serving as regional growth points, and what their future role—or that of the commission, as legal successor—should be.
  My hon. Friends will no doubt ask me about the future of the commission itself. Under existing legislation, the commission is a permanent body—there are no powers to wind it up. We are currently considering the future of the commission, along with the matters that arise from the winding up of the existing corporations. Our conclusions will be reflected in the measures we will put before the House, to deal both with winding up and the revisions to the financial regime that I mentioned earlier. I cannot say today exactly when those measures will be—hon. Members will be aware of the pressures on legislative time—but it will be as soon as we can manage. Meanwhile the commission, under the leadership of Sir Neil Shields, has plenty to do consolidating its achievements at Corby, continuing its highly successful programme of disengagement—more than £150 million of commercial and industrial assets sales since 1979—and now, of course, preparing to take over the eight towns with target dates in 1984 and 1985.
  This is a short debate and, with the leave of the House, I would like to speak again at the end to deal with any points raised. I shall, therefore, not take up any more time now, except to say, on behalf of hon. Members on both sides, how much we all appreciate the efforts and dedication of the boards and staff of the new towns as they take their towns towards completion. This extra £500 million of borrowing approval is a crucial element in achieving that task.
  11.40 pm
  Mr. Jack Straw: The order proposes an increase in the borrowing level for the new towns of £500 million for essential services. The Opposition will not divide the House against the order.
  New towns are of great concern and interest to all hon. Members, especially to the Opposition as the Labour party —[Interruption.] The alliance is showing its customary interest in all matters in the House, and on that we can always agree.
  The 1945–51 Labour Government established the new towns, and the Labour party has always looked upon them benignly as would any parents on their successful children. I have always had a special interest in the new towns from the time that I was associated with and worked for my right hon. Friend the Member for Bethnal Green and Stepney

  281
  (Mr. Shore) as an adviser at the Department of the Environment on the review that took place on the new towns, which led to changes in their population targets because of changes in the overall population growth. Although some of the decisions made by my right hon. Friend were regarded as controversial, and especially the decisions about the central Lancashire new town, those that he made about their overall growth and structure have well stood the test of time.
  The new towns were a uniquely successful experiment and involved unique co-operation between public and private enterprise. The Town and Country Planning Association's evidence to the Nuffield Foundation inquiry on the planning system, said:
  "The new towns have unbeaten records in innovative economic development, imaginative social development, and cultural animation. The special government agencies that created them have succeeded in attracting and harnessing the talent of their time, and demonstrated that public investment in such projects was not only worthwhile in itself, but a genuine investment even if measured in simple economic terms."
  Given the current Conservative party obsession about selling off anything marked "public", it is important for Conservative Members to consider the record of the new towns and to bear in mind that public agencies can frequently help and stimulate jobs in the private sector. The Under-Secretary said that 20,000 new jobs have been generated by the new towns in recent times.
  Given the importance of the new towns and the development corporations as agencies for job creation, I hope that the Government will not show any undue haste in winding up the existing development corporations. We all understand that they are bound to have a finite life. No one is arguing that they should go on for ever and a day. I detected a suggestion by the Under-Secretary that an arbitrary target has once again been imposed. This is yet another way of removing civil and public servants from the books. I hope that he resists that approach. I am aware of his concern for the new towns.
  Sir George Young: If the hon. Member looks further into history, he will realise that the dates that the Government suggested are those proposed by a Labour Administration.
  Mr. Jack Dormand: The Minister knows that they were realistic.
  Mr. Straw: Indeed. I thought that the Minister was suggesting that he would bring forward the dates. I am relieved to hear that that is not the Government's intention.
  11.45 pm
  Mr. Michael Fallon: It appears that the order is as timely as it is generous. It gives us an opportunity to consider the progress of Government policy towards the development corporations.
  I hope that the hon. Member for Easington (Mr. Dormand) will allow me to join a cause and campaign that he has made very much his own. Many of my constituents work at Aycliffe and many of them have jobs only because of the success of the corporation in attracting inward investment. I hope that my hon. Friend the Under-Secretary will accept that there is some concern among the Conservative northern Members' group about the future of the corporations in the north. The concern is twofold. First, the corporations in the north would appear to be different animals from those in the south. They are now
  282
  essentially job-seeking organisations, having divested themselves of other functions. Secondly, if they disappear at the end of next year, they should not do so without Ministers giving further thought to the gap that will be created in attracting fresh investment to the north-east.
  It is appropriate that the consideration that is now being given to the review letter, to which my hon. Friend referred, follows shortly after publication of the regional policy White Paper. I hope that he will consult closely his colleagues in the Department of Trade and Industry. Abolition is easy to accomplish, but in an area of high unemployment we should be careful to ensure that what we end up with is at least as good as, if not better than, that which existed hitherto.
  11.47 pm
  Mr. Jack Dormand: We have had a complacent speech from the Under-Secretary of State, which was rather untypical of him. I have always regarded him as being very much a realist, and to that extent I have enjoyed listening to him. But one would have thought that everything was well in the new towns after hearing him. He knows that some of the current problems are greater than those that preceded them. I understood him to say that there is adequate housing for rent. What area was he talking about? He certainly was not talking about the area that, in part, I represent.
  Mr. Norman Hogg: Nor Scotland.
  Mr. Dormand: The Minister made a rather peculiar statement. He then referred to the reduction in new town staff as if there was some intrinsic merit in that. I ask him to accept that that is not so. I almost regret that I promised to make a short speech, because I could have made an entire speech in response to the Minister's contribution.
  The Minister properly mentioned the sort of projects that are necessary and for which we are voting moneys. But we know that the assets will be sold off at the earliest possible moment by the Government. That which is happening in the new towns is yet another demonstration of the Government's dogmatism on privatisation. The new towns are a success in spite of the many difficulties that they have had to face. There has been no greater problem than the uncertainty caused to the development corporations by the Government. That uncertainty will be shown in my short contribution.
  The Minister knows that I could justifiably repeat the case for more money to meet the massive bill for repairs to houses in Peterlee in my constituency. He was realistic enough to visit Peterlee last year, and he saw for himself the terrible state of some of the houses, affecting many thousands of my constituents. I have raised the matter on many occasions and I hope that what he has said tonight, and previously, will not be his last word. It has a tremendous effect on the people of my constituency. He admitted perhaps two years ago that the state of the housing in Peterlee new town was the worst of any housing in the country.
  I make no apology for returning yet again to the winding up of Peterlee development corporation. The hon. Member for Darlington (Mr. Fallon) referred to it and to Aycliffe. He will be aware that although legally they are two separate bodies they are composed of the same people. The proposal is that the corporation be abolished on 31

  283
  December 1985, so, in effect, we are talking about a period of considerably less than two years because the corporation's work will obviously have to be run down some months before that date.
  It is impossible to follow the Government's thinking in this matter. My constituency, with Durham county and the northern region, has the highest unemployment rate in the country outside Northern Ireland. That is one side of the coin. The other side shows, without argument or doubt, that Peterlee development corporation is one of the most successful job-finding agencies not only in the north but in the country.
  There is a simple question to be asked: in such circumstances, will there be a need for such an agency after December 1985? The answer is self-evident to everybody except the Government. Everyone in my area, including the local authority of my hon. Friend the Member for Bishop Auckland (Mr. Foster), is at a loss to understand why such a proposal should even be contemplated.
  I shall not go into detail on the successes achieved by the corporation although I am sorely tempted to do so, particularly as the Under-Secretary did not refer to the achievements of Peterlee when he was talking about some of the other new town corporations. I have all the figures here. Suffice it to mention, wanting to be as up to date as possible, that in the three months from September to November 1983 Peterlee reduced unemployment in percentage terms more successfully than any other new town apart from Redditch. Given the state of the economy, considering the competition, and given the obstinacy of the Government in economic policies, that is no mean achievement.
  In a letter to me dated 28 July 1982 the Under-Secretary said:
  "The new towns' success at industrial promotion will be a major factor to be considered when we come to review their target dissolution dates, and we do not rule out the possibility of a further extension of the Corporations' life at that stage."
  The record of Peterlee development corporation in industrial promotion has always been first class, but it so happens that in the period since the letter was written outstanding successes have been achieved by the corporation. The Minister is aware of the names of some international firms that have been attracted to the area. In spite of what the Under-Secretary said tonight, I am sure no other corporation has a better record.
  In answer to a parliamentary question from me on 23 November last year, the Minister stated that he had begun a review of the target dates for the winding up of the corporation and that he would aim to issue a consultation paper shortly. He said:
  "Our intention is to complete the review by 31 March 1984 at the latest."—[Official Report, 23 November 1983; Vol. 49, c. 221.]
  Of course, he had some comment on that in his remarks tonight. I am concerned about how much time will be allowed for the consultation he mentioned in his answer. He has said that he will speak again if he catches your eye, Mr. Deputy Speaker. Perhaps he will say when he replies what stage the review has reached. We all know from experience how long it takes to go through the normal machinery before it finally reaches the corporation and the local authorities. There is a suspicion, which I share, that precious little time will be given for consultation. If it turns
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  out to be short period, many of us will feel that the consultation is a sham, that the Government's mind was already made up and that they are merely going through the motions of consultation. If I see the Minister shaking his head, I can only say that the proof of the pudding will be in the eating. Perhaps we shall be able to return to the subject nearer 31 March.
  Easington district council has recently decided to initiate talks with Peterlee development corporation and Sedgefield district council, which is in the constituency of my hon. Friend the Member for Bishop Auckland, as the Aycliffe development corporation is in the Sedgefield area and will be similarly affected. They are as worried as I am. It would only be common justice for every authority to be given the maximum time for consultations.
  The Minister knows that I have raised this matter many times. In my 13½ years as a Member of Parliament there has been no issue of greater importance to my area. That shows my strength of feeling on the matter. In the desperate circumstances of today, the expertise and dedication of the corporation are the lifeblood of my constituency and the sub-region that the new town serves.
  It would be little short of criminal to implement the Government's proposal. I remind the Minister that we are discussing the future of thousands of people, many of them young, who depend, and will continue to depend, fully on what the corporation can do. The need for a job-finding agency will remain for a long time after 31 December 1985. I fervently ask the Government to think again on this matter.
  11.56 pm
  Mr. Den Dover: I shall not continue the line of argument pursued by the hon. Member for Easington (Mr. Dormand). I should like the central Lancashire development corporation to be well and truly wound up at the end of 1985. I have no hestitation in recommending that my hon. Friend the Minister gives me that assurance today or in writing soon. He mentioned the reduction in staff since 1979. However, central Lancashire is still increasing its staff when it should be cutting down and preparing for the winding up.
  I was disappointed that my hon. Friend did not mention the transfer of housing ownership to local authorities or to a housing association. Perhaps he could say how far the discussions have progressed, as there seems to be a massive split of opinion between local authorities and other local interested parties.
  The purpose of the development corporation in central Lancashire has been fulfilled. I am delighted that the statement by the then Secretary of State for the Environment on 4 February 1981 has been closely followed by the Government in the past three years. I refer to the complete switch to private ownership of housing rather than a continuation of the earlier too massive rented housing programme, the fact that private developers have been allowed in to open up new areas for industrial development, the fact that the sale of new town houses has been allowed and the fact that the private sector has been able to buy assets.
  I have nothing but admiration for the determined way in which Ministers in the Department of the Environment have continued the task in the past three years. I ask them only to ensure that central Lancashire winds up at the end of next year as local people are anxious for that to happen.
  11.58 pm
  Mr. Derek Foster: My hon. Friend the Member for Easington (Mr. Dormand) mentioned the Opposition's greater affection for the new town movement. For many of us it represents an excellent example of Socialist planning. It is an excellent example of how public expenditure can encourage and even underpin private investment. Indeed, without the initial public expenditure the private investment would not have taken place.
  For those reasons we welcome the new town developments and very strongly urge that the Government take a new look at their new town policy. I live in, although I do not represent it, the new town of Washington. I represent the new town of Aycliffe. Washington broke new ground in the design of factories and taught the north-east that it was perfectly possible for factories to exist cheek by jowl with residential development without there being any inconvenience or amenity detriment to the people who lived close by the factory. That was something new for the north-east, after our bad experience with heavy industry, which is often dirty and dangerous.
  Secondly, Washington broke new ground in landscaping, which was important for the whole of the north-east. We were taught salutary lessons about how people could be attracted to the north-east because the quality of our inner urban environment was as good as the quality of our rural environment, which is second to none, as you, Mr. Deputy Speaker, will be only too ready to recognise, with your constituency.
  Thirdly, Washington broke new ground in social development. I am proud to have been associated with that. Most local authorities have learned healthy lessons on those three counts. However, I shall dwell on the job-hunting function of the north-east new towns.
  It is arguable that the need for the job-hunting function to be retained is greater now than when the new towns were first instituted in the north-east. Our suffering under the present recession has been horrific. As my hon. Friend the Member for Easington reminded the House, there is a great need for further investment in the north-east so that we have a chance of prosperity. There are huge numbers of young people leaving school for whom there is no hope. The Government believe that new jobs will come in three major areas—small business development, service sector industries and advanced technology. It is arguable that my region is unfavourably placed for all three of those developments. If we are to leave it to market forces, the north-east will be in an even worse position in 10 years' time vis-à-vis the other regions than it is now. Therefore, it is even more important that a successful job-hunting agency should be retained. If one wishes to replace it, one had better be absolutely sure that what one replaces it with, as the hon. Member for Darlington (Mr. Fallon) said, is at least as successful as the new towns.
  The new towns have taught a lesson to most of the local authorities in the north-east and the rest of the country. Most of them are in the job-hunting business, largely as a result of the Government's devastating policies. The whole country is being made into a development area and needs to win new jobs. Most of the lessons originated in the new towns. The nursery factory development was pioneered in the new towns.
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  I dearly want to say to the Minister, "Before you replace the successful agency in Aycliffe—I am certain that Washington and Peterlee would make the same argument—you must be convinced that you will replace it with something just as successful and streamlined, in which the expertise is as professional and the marketing can be deployed with the same effect." Although I am a passionate local government man, I am deeply suspicious that the local authorities are unable to take over the role with the same effectiveness. I wish that I could say otherwise, but my long experience as an ex-chairman of the North of England Development Council and of the economic development committee in a metropolitan county council, trying to win new jobs for the north-east, has taught me that it is difficult for a local authority to be as effective as the new towns. I am worried that if we lose the Aycliffe and Peterlee development corporation, nothing as effective will be put in its place. If that happens, this Government, irrespective of who made the first decision or when the first date was suggested, will bear a heavy responsibility. We see no new jobs coming from any of the policies that have been suggested. We therefore need to retain the effective job agencies that we have.
  12.5 am
  Mr. Derek Conway: I shall begin my short speech tonight by paying tribute to the Washington development corporation. I was privileged to serve on the board of that corporation before I was elected to this House. I joined the corporation as a cynic, but I became a convert as a result of my experience there. My political opinions were very different from those of some of the members of the board, but there was a concerted effort by all those involved to improve the lot of the people who lived in the area, and certainly to improve job generation, which I shall come to later.
  Despite that fact, and despite the great affection that I have for the work of the Washington development corporation, I am of the opinion that development corporations are the products of a different time, that in the main they have now outlived their usefulness, and that the winding-up dates should be met as soon as possible by the Government—and, better still, in the case of some development corporations, accelerated.
  I refer, in particular, to the development corporation that adjoins my constituency of Shrewsbury and Atcham in Shropshire—the Telford development corporation. At present, it has a longer life expectancy than that of the Washington development corporation and some others, and I hope that its winding-up date will be accelerated. In saying that, I appreciate that winding-up dates have a bad effect on development corporations — not only on the board members, in terms of their impetus and enthusiasm for leadership, but particularly on the morale of the staff. I tend to come down on the side that believes in pulling people out of their misery.
  The hon. Member for Bishop Auckland (Mr. Foster) and my hon. Friend the Member for Darlington (Mr. Fallon) made valid points about the regional job generation side of development corporations. I share their concern that the Government should not rush in there too quickly, and that any liaison with the Department of Trade and Industry must be a proper liaison and not produced under pressure. However, I urge them to consider why the development corporations have been so successful. In my

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  opinion, it is because they have not been subject to the pressures that there are on local government, where so many people have fingers in the pie.
  The hon. Member for Bishop Auckland was a distinguished chairman of the North of England Development Council, of which I, too, was a member. There is a suggestion that bodies such as the Washington development corporation and Peterlee and Aycliffe should come within the auspices of that organisation. If that happened, it would be a disaster. The impetus and the time for reaction that those development corporations have given to industrial inquiries and to promoting the job generation aspect of their responsibilities would be hampered by substantial local government involvement. The hon. Member for Bishop Auckland and I have sat too many times at lengthy meetings of the North of England Development Council, with members going on and on and never reaching decisions. That is not the way ahead, once development corporations are wound up.
  We should look closely at the role of the regional promotional bodies, not least that of the Investment in Britain Bureau within the Department of Trade and Industry, an organisation about which we in this House know far too little. The time is long overdue, especially because of the pressure of such bodies as the Scottish Development Agency and, bordering on my constituency, the Welsh Development Agency, for an English national agency. That would give wider support not only to such development corporations as Telford but to those of us who represent seats that are not within the promotional aegis of development corporations or the Department of Trade and Industry. Jobs are now needed all over the country, and not in any particular area, as the old policy had it. The proposals for the revision of job generation responsibilities within development corporations are not looking too good. I hope that all the signs that are coming from the two Departments concerned are misleading and that the proposals that will be put before us will be more effective than those being suggested at the moment.
  12.10 am
  Mr. Christopher Murphy: In supporting the order, I do so in the belief that it will help ensure that the cry, "The end is nigh" at last becomes a reality for the new towns programme. It is essential that an end date is provided for every new town development corporation, so that a limit on public financing is clear to all taxpayers. It is also essential that an end date is provided for the Commission for the New Towns and for its withdrawal from each town, such as Hatfield and Welwyn Garden City, so that a limit on this Government-funded quango is evident to all concerned.
  There can be no doubt that since 1979 the present Administration have taken a far more responsible view of new town development and have rightly sought to restrict its continuation and bring about a realistic completion. It should also be emphasised that the Government, by switching attention away from the development of green field sites to the inner cities, have been correctly attempting to redress an imbalance that threatens realistic conservation.
  The order, applying as it does to the respective new town administrations, will restrain but not impede them in completing their tasks. It is far better that the Government
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  concentrate their support on the urban needs of our community to promote economic and physical regeneration of inner city derelict land.
  The order, by virtue of its limiting powers on finance, shows to the corporations and the commission the need to finalise their activities and to ensure a rapid transfer of public assets to the private sector. On the former point, it is to be hoped that this will be done with the maximum use of non-governmental investment, and on the latter that this will be achieved with minimum delay and with particular advantage given to local tenants.
  It must be correct that where public financing is employed — that should always be a matter for circumspection—it should be used to the best advantage of our citizens, who, after all, provide the finance in the first instance. That is why to concentrate action on urban development grants, enterprise zones, urban development bodies and land registers is likely to yield more favourable results by revitalising the inner cities after years of neglect.
  No doubt there will be a continuation of the cries of, "Woe is me" and similar lamentations from those who seek to perpetrate the bureaucracy of new town development and who have sought to use the new towns as an extension of the corporate state. The real woe will come for the residents of the new towns if the winding up of the commission and of the corporations is long delayed. The real woe will also come for the taxpayers without such a winding up because of a failure to ensure the completion of the new town programme.
  12.14 am
  Mr. Kenneth Hind: I welcome the comments of my hon. Friend the Minister on the transfer of the assets of Skelmersdale to the west Lancashire district council. I also welcome the increase of £500 million in the borrowing order before the House. I welcome the winding up of the development corporations. Perhaps it is significant that the number of people who today have been arguing forcefully about local authority councillors having the right to determine their funding have gone home by the time we talk about transferring housing and community assets to district councils and giving those representatives control over their towns. It must be remembered that the local democratic representatives in areas with development corporations have little say in the running of their towns. The Government, by supporting the return of those towns to local councils, are returning local democratic accountability to the people who live in those towns. For that reason, I welcome that development, especially in Skelmersdale, as I am sure do the people of that town.
  Mr. Norman Hogg: On the question of the relationship of democracy in new towns and the democracy of local authorities, will the hon. Gentleman join me in a campaign which I have pursued since becoming a Member of Parliament to allow the press and public to attend meetings of development corporations so that, just like local authorities, the population of those towns are aware of what is going on in their name?
  Mr. Hind: I support the hon. Gentleman in that respect. One of the disadvantages faced by those in development corporation officialdom is that they have not had behind them an elected representative who is answerable to his constituents. That will be altered when the development corporations are wound up.

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  The people who have worked hard to create new towns must be congratulated, but their time is now over. Their era has ended and the towns must be returned to the district councils. There are those of us who will not be quite as congratulatory as the hon. Member for Blackburn (Mr. Straw) about the planning of the new towns. I echo the words of the hon. Member for Bishop Auckland (Mr. Foster) that they are a fine example of Socialist planning. I hope that the 5,000 people living in Skelmersdale who do not have a job feel the same way about that wonderful Socialist planning, but I do not believe that they will feel quite as happy about it. Perhaps the Opposition have much to answer for in the problems of Skelmersdale.
  I hope that the Under-Secretary will look carefully at the future industrial development of the new towns. I echo some of the thoughts of other hon. Members who have said that when the development corporations disappear on the industrial side something must be put in their place, particularly in Skelmersdale, with its high level of unemployment. Encouragement must be dynamic. It must bring in new firms and jobs. We must bear in mind especially that some of these towns are special development areas; they need assistance. We must continue to increase industrial development and provide new jobs.
  Contrary to what has been said by the Opposition, the 108 schemes for small firms now in operation will help to produce new jobs. They are often laughed at by the Opposition, and their importance is underestimated. This policy is followed dynamically by the Government, and I am sure that it will provide jobs in the new towns. We must bear in mind that we cannot take—as we have done in Lancashire—some green field of England and plant on it a new town. We need to hand the area back to the people, as the Government are doing. A chamber of trade, Rotary club or local council—the dynamic elements of any society — must develop. By continuing with the corporations, the position is simple: we are holding back the development of the new towns as a community. I congratulate my hon. Friend the Under-Secretary and hope that he will continue with his efforts.
  12.19 am
  Sir George Young: As always when we discuss the new towns, we have had a stimulating and wide-ranging debate on a matter in which I know that you, Mr. Deputy Speaker, have an interest.
  The hon. Member for Blackburn (Mr. Straw) indulged in a bit of philosophy and a bit of history. Perhaps I may indulge in a debating point with him. He described the new town corporations as great public agencies—Socialism in action. Had he been here this time yesterday when we were defending our decision to put more money into the dockland development corporations, which are in effect new town corporations except that they happen to be in the inner cities, he would have heard a barrage of criticism from his right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) to the effect that, far from putting more money into the corporations, we should be giving all the responsibility back to local government. At some point the Labour party will have to decide whether these are sinister capitalist plots or Socialism in action but implemented by the Conservative party.
  Mr. Straw: That is a silly point.
  Sir George Young: It is not silly at all. It is an example of the hypocrisy in which the Labour party occasionally indulges. However, it is just a debating point and I shall not tease the hon. Gentleman with it any further.
  My hon. Friend the Member for Darlington (Mr. Fallon) made a valid point, echoed by several other hon. Members, about employment in the north-east. The hon. Members for Easington (Mr. Dormand) and for Bishop Auckland (Mr. Foster) also took this up, as did my hon. Friend the Member for Shrewsbury and Atcham (Mr. Conway), who served with distinction on the Washington corporation.
  With regard to the new towns in the north-east, we are engaged in a genuine review about the winding-up date. It is an open-minded review with no preconceived decisions on the part of the Government. We wish genuinely to consult the local authorities. The Act indeed requires us to consult the county and district councils directly concerned before reaching a decision, and we hope to be in a position to do so in the near future. The aim will be to give the local authorities two months in which to reply to the consultation document. The questions that we pose are not novel. The local authorities know exactly what the issues are and will be well aware of the arguments that they wish to deploy.
  The hon. Member for Easington accused me of complacency. I take pride in what the new towns have achieved, as I am sure he does. There is nothing complacent in outlining the achievements of the corporations in the past few years with the resources voted to them by Parliament.
  With regard to housing, the special problems of Easington and Sedgefield were recognised by giving them a 50 per cent. rather than a 40 per cent. grant. I understand that the local authority has now accepted that as a satisfactory solution to the problem described by the hon. Gentleman.
  As for a promotional agency for the north-east, the theme that emerged was that it was not so much the development role of the corporation that was needed as the promotion and job-finding role. That raises the slightly different question whether this should be confined to the narrow areas covered by the new towns or whether it should be a broader role of promoting the north-east in general. Again, I have an open mind about how to carry forward the valuable work done by the corporations in generating new jobs for the north-east.
  My hon. Friend the Member for Chorley (Mr. Dover) asked about housing. We are awaiting the formal views of the three district councils. We had an informal meeting with them on 20 December last year and we are now awaiting their formal reaction. I confirm that the target date for the transfer of housing is 1 April 1985 and the target date for winding-up is 31 December 1985.
  The hon. Member for Bishop Auckland made a very sensible speech. I do not dissent from any of the views that he expressed, which were endorsed to some extent by my hon. Friend the Member for Shrewsbury and Atcham. The winding-up date for Telford is currently the late 1980s but we shall, of course, liaise with the Department of Trade and Industry, which clearly has an interest in the role of promotion and industrial recruitment in that area.
  My hon. Friend the Member for Welwyn Hatfield (Mr. Murphy) asked about the winding-up of the commission.

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  It is our proposal to take powers to wind up the commission the moment a legislative window appears in a rather congested programme. I take note of what he said.
  My hon. Friend the Member for Lancashire, West (Mr. Hind) made the very good point that there is no reason to perpetuate an unusually large public sector presence in the new towns simply because they happened to be new towns at the beginning. The aspects that make the new towns attractive to industry and commerce — their location, their communications, the facilities and the environmental quality — all remain after the corporation is wound up. There is a strong argument, which my hon. Friend deployed, for handing over to local people the assets that have been generated by the new town corporations.
  The debate last night demonstrated the Government's commitment to the inner cities and the debate tonight demonstrates our commitment to the new towns. For the inner cities the task is regeneration after years of neglect, to be carried out in partnership with the private sector. For the new towns, again in partnership with the private sector, it is the completion of their development so that they can take their place among the ranks of the successful thriving old towns. The money we are putting into both tasks is needed to achieve those aims. The private sector is already responding to that task, and I know that it will continue to do so.
  I mentioned earlier how much we appreciate the work put in by the boards and the staff of the new towns who have over the past 37 years risen to all the challenges of initial planning and the development of growth, with excellent results that hon. Members on both sides have mentioned, results that have made the British new towns world leaders in town planning and development. We have supported the new towns in their development and will continue to do so as they move towards completion. I know that the boards and the staff will rise to this challenge of completing the towns, just as they have to all the earlier tasks.
  Question put and agreed to.
  Resolved,
  That the New Towns (Limit on Borrowing) Order 1983, dated 12th December 1983, a copy of which was laid before this House on 20th December, be approved.

  Health (Wales)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lang.]
  12.27 am
  Mr. Gareth Wardell: I am pleased that I have been successful in the ballot so as to be able to draw attention to the very important problem of inequalities in health within Wales.
  In Wales in 1981 453 infants under the age of one year died. The report of the committee on child health services stated:
  "In contemporary terms, infant mortality is a holocaust equal to all the deaths of the succeeding twenty-four years of life".
  The infant mortality rate has long been regarded as a useful indicator of the state of health and health services in a country. If we compare the situation in Wales with that in France, Finland, Sweden and Japan for the years 1964 to 1980 on a two-year basis, the infant mortality rate is worse in Wales than in every one of those countries and for every year except for France in 1966 and 1968.
  In 1980 the infant mortality rate in Sweden was 6·9, and in Wales it was 11. Considerable as the differences are between Wales and other countries in the infant mortality rate, the differences within Wales are very much greater. No doubt that is partly why doctors in west Glamorgan, for very good reason, have been conducting confidential inquiries into perinatal deaths since January 1981. It is the same fact that has prompted the setting up of the catalyst team and survey group that will prepare the Wales perinatal mortality survey. I welcome the aim of this initiative as a stimulation for improvement in maternity and neonatal care in the Principality. A clear need for such improvements is indicated by the large disparity in the infant mortality rate by socio-economic groups.
  For example, in west Glamorgan—part of the county that I represent—the latest figures available show that the infant mortality rate is 7 per 1,000 live births for socio-economic group 1, while it stands at 19 per 1,000 for socio-economic group 5. If the perinatal rate is examined, the gap is far wider: 7 per 1,000 total births for socioeconomic group 1 and 27 per 1,000 for socio-economic group 5.
  On 12 December 1983, the Minister gave me an assurance that the new system of capital expenditure allocation to health authorities in Wales would in no way delay the implementation of the planned new paediatric and obstetric unit at Singleton hospital, Swansea. That was a most welcome assurance.
  But the fundamental need, clearly demonstrated in the DHSS working party report of 1980, is a comprehensive anti-poverty strategy, and, as the Black report stated, pride of place in that strategy must be a massive redistribution of income and wealth. I wish that the Government would pursue that goal and fully realise the grim reality portrayed by Dylan Thomas, one of the greatest Anglo-Welsh poets, in his little-known poem,
  "A Refusal to mourn the death, by fire, of a child in London",
  in which he said:
  "Deep with the first dead lies London's daughter,
  Robed in the long friends,
  The grains beyond age, the dark veins of her mother,
  Secret by the unmourning water
  Of the riding Thames.
  After the first death, there is no other."

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  The disadvantages of birth and early life cast long shadows forward. It is at that time that Government can most usefully and productively contribute to a vast improvement in the health of the British people.
  I come to the services provided within the NHS for the care of the mentally ill and mentally handicapped. While the Welsh Office initiative to promote, so far as possible, the rehabilitation of the mentally ill and mentally handicapped into the community is welcome, at least one major aspect of it is extremely worrying. That is the problem of those elderly mentally handicapped and disturbed mentally handicapped who are of necessity being maintained in hospitals and for whom there is no provision in the new initiative.
  It would seem inappropriate, therefore, not to plan to improve our existing services to accommodate these people; but the same money cannot be spent in two areas, in health and social services. Within our existing hospital units—for example, Cefn Coed hospital, Swansea — which are overcrowded, old, and in need of refurbishing, the amount of money that we can expect to spend is limited. Yet the problem of accommodating the frail elderly mentally handicapped will be with us for some time.
  The future pattern of psychiatric service development provides the main thrust between acute and psycho-geriatric services. There is a small, important and ever-present body of long-stay patients who may be left behind in the main thrust of initiative but whose presence in the community is a continuing problem. This problem was courageously and expertly examined by Marjorie Wallace in an article in The Sunday Times of 20 November 1983. The article examines the failure of community care to cope with the mentally sick. While the article focuses on Southampton, it also states:
  "the scandal of the mentally sick is a national one. I found similar patterns in London, Oxford, Birmingham, Newcastle and Swansea."
  The community care policy throws the onus on to the local authorities, but they are not legally obliged to act. In the United Kingdom as a whole, only 1·1 per cent. of the total social services budgets is spent on community health for the mentally ill. One quarter of local councils provide no day care whatever for the mentally ill. One fifth offer no council residential accommodation.
  John Wilder, director of the Psychiatric Rehabilitation Association, has said that
  "People who need to be in hospital are walking the streets, often dangerous to themselves and others. They are the new vagrants".
  I question the accuracy and validity of the method by which National Health Service funds are distributed among the regions. That is a crucial consideration in assessing the extent to which Wales receives its equitable share of available allocations. It is questionable whether the four present formulae used perform a useful function. If they do, I hope that the Minister will explain the rationale underlying their use and will also explain the Government's opposition towards a single national formula. If the Minister chooses not to do so, it would be helpful for the people of Wales to know at least whether a move towards the use of the resource allocation working party formula would increase Wales' allocation of National Health Service funds. Research published in The Lancet on 12 December 1980, referring to 1977–78, showed that if the RAWP formula was applied to the health care budget Wales would have benefited
  294
  substantially. If that is still the case, perhaps the Minister can tell us what steps he is taking to remedy the under-funding.
  It is crucial to remind the Minister of a statement in the Court report of 1976, which was recently reprinted:
  "Despite recent efforts to bring about more equality, the variations in regional provision of service are still much the same as they were in 1948 when the National Health Service began."
  12.38 am
  The Under-Secretary of State for Wales (Mr. Wyn Roberts): I am delighted to have an opportunity to discuss the subject of inequalities in health in Wales. I begin with the last point made by the hon. Member for Gower (Mr. Wardell). A great deal has been said about this subject in recent months by those who should know better. It is opportune that I should be able to make an unequivocal statement on the issues and the facts.
  When the major reorganisation of the NHS took place in 1973, one of the first problems to which everyone concerned addressed his mind was the generally accepted fact that health resources were not distributed in a way which necessarily reflected health needs. The ideal way to tackle the problem was to measure health need, then to measure the amount of health care available and finally to bring the two into line.
  The trouble was that neither health need nor care proved to be directly measurable. Eventually, it was concluded that need and supply could be measured indirectly. The major determinant of need was seen to be population and the principal determinant of supply was revenue funding. Inequalities could be identified by taking a particular area's share of the total population and comparing it with that area's share of the total revenue funding. But the population of a particular area need not necessarily be directly comparable, head for head, with that of another area. In particular, it was a well-established fact that the age and sex structure of a population significantly affects the likely need for health care. It also accepted that even when the age and sex structure of the population is taken into account, there can still be differences between otherwise similar populations in the amount of illness occurring. Although this latter point has occasionally caused some controversy because of the extreme difficulty of measurement in this field, a consensus has been reached that the best available way to measure this uneven incidence of sickness is to use the death rate for particular population groups — that is, standardised mortality ratios.
  The conclusion reached, therefore, was that, to identify inequalities in the distribution of health resources, weighted populations would be calculated for health authorities and their weighted proportion of total population compared with their weighted proportion of health resources. That has been the basis on which in Wales, Scotland and England inequalities have been identified for the past eight years.
  Two major areas of concern need to be dealt with. The first is a point that has been raised repeatedly lately, and to which the hon. Gentleman referred. It concerns claims that Wales is seriously underprovided relative to the other parts of the United Kingdom. Those making these claims have referred to work done by Professor Maynard of York university. He calculated the shares of population of the four constituent countries of the United Kingdom and compared them with actual revenue expenditure by health

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  authorities in those countries in 1977–1978. His figures appeared to show that Wales was at that time 7·5 per cent. underprovided.
  I do not wish to weary the House with an explanation of the way in which public expenditure levels on particular programmes are set in Wales these days. Suffice it to say that for the past four years my right hon. Friend the Secretary of State for Wales, like his colleague in Scotland, has had discretion within a total block of expenditure to distribute the money between the individual programmes in the light of his assessment of Welsh needs. Programmes are not, therefore, directly linked with their English counterparts, but can be developed on lines dictated principally by the needs of Wales.
  For that reason, therefore, we do not set the level of spending on health in Wales by some mechanistic link with what is being done in the NHS in England. We do the best we can in the overall public expenditure environment to make appropriate provision for the development of all services, including the NHS, in the Principality.
  We do not, therefore, undertake the sort of exercise which Professor Maynard did to compare ourselves with the rest of the United Kingdom.
  It is worth saying that if we were to take the proportions between the countries which Professor Maynard suggested as the right ones in 1977–78 and applied them to the provision for revenue expenditure by health authorities made in the Supply Estimates for the four countries in the current financial year, 1983–84, it should give us a broad indication as to whether things have changed. The result of doing so is to show that, on the basis described, Wales in 1983–84 was only 0·3 per cent.—that is one third of 1 per cent. — below the share which Professor Maynard's figure suggested was the right one compared with 7·5 per cent. in 1977–78. I would not for one moment claim that such a calculation — any more than the original one on which it is based—was totally reliable and accurate. In so far as it shows anything, it indicates that if there was a gap in 1977–78 the Government have virtually eliminated it.
  When I tell the House that these figures do not take into account the fact that my right hon. Friend has already announced that growth in revenue spending by health authorities next year will be a further 2 per cent. over this year's levels, and that that is significantly greater than the level announced for England and Scotland, I think that it can be seen in terms of our share of United Kingdom funding that Wales under this Government has certainly not been disadvantaged.
  The second area in which inequalities exist is that of the differences between health authorities in Wales. On that point I need detain the House no longer than to say that my right hon. Friend is committed to removing major inequalities within a three-year period, of which 1984–85 is the second year. Those problems exist and the Government have not only given a firm commitment to deal with them but have set themselves a very testing timetable within which to meet that commitment.
  I understand fully the almost limitless extent of demand for health services. We are all aware that there remain bottlenecks in the provision of services and that each new expansion and development of health care appears as much to generate new demands as to satisfy old ones. The
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  Government's commitment to finding extra resources for the Health Service cannot be questioned in the light of our record, but for the foreseeable future we will always be faced with a total potential and actual demand that exceeds our ability to meet it. There is no point in being unrealistic about that — every Government, even a Labour Government, must recognise that fact of life.
  It is because of that that equal realism is needed to ensure that we get the maximum possible amount of health care—direct care for patients—out of every penny that we spend on the Health Service. We can equalise the distribution of resources, but it is as important, if not more important, to ensure the proper management of those resources in the interests of patients. All the Government's policies for the NHS are designed to ensure that the most efficient practices are employed everywhere and that every action undertaken by every member of the staff of the NHS aims to secure the best possible treatment for the maximum number of patients within the resources available. When we speak of inequalities in resources, it is important to recognise that there are also inequalities in the use of those resources, and we should be equally concerned about eliminating those.
  The financial expansion provided has been accompanied by a significant growth in manpower. Since 1979 there has been an increase of 13 per cent. in the number of nurses and midwives, 15 per cent. in the professional and technical staff providing scientific services for doctors and nurses, and a provisional increase of 16 per cent. in medical staff.
  Most importantly—returning to my theme of getting value for money and the maximum possible services from the record resources made available—all that has led to more people being treated. In 1982, the latest year for which figures are available, the Health Service in Wales treated 5·9 per cent. more in-patients than in 1979, 12·3 per cent more day cases and 8·6 per cent. more out-patient attendances.
  Central to the drive for increased efficiency and effectiveness are the annual reviews of district health authorities that the Government introduced last year. Under those we require authorities to secure annually minimum efficiency savings amounting to 0·5 per cent. of their recurring revenue budgets. Those must be genuine improvements in efficiency and not involve any reduction in the volume or quality of existing services. I am glad that the response of the authorities has been extremely encouraging, such that we are hopeful that improvements in efficiency will yield savings significantly greater than the minimum required. That will mean improvements in services over and above the further growth incomes we have made available for next year and over and above the redeployment of the 0·5 per cent. required.
  That leads me to the second and equally important aim of the reviews under which we require authorities to redeploy the first 0·5 per cent. of their efficiency savings on continuing care services for mentally ill, mentally handicapped and the elderly, precisely those mentioned by the hon. Member. These are the services which by common consent need special attention if both the quantum and the balance of services is to be got right. The requirement will lead to about £2·75 million of additional investment in these services in 1984–85. Individual projects for this reinvestment include, I am glad to say,

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  west Glamorgan health authority's intention to finance part of the costs of its assuming responsibility for mental illness services for the Neath and Port Talbot areas.
  This is just part — although a vital part — of our concerted effort to redress the historic inequality of provision for these groups, both relative to the acute sector and as between authorities. Unlike the previous Labour Government, we have displaced rhetoric with achievement. Under our all-Wales mental handicap strategy, for example, additional spending will build up over 10 years to £26 million. It will be a fourfold increase on present levels of financial provision.
  Through our "Care in the Community" initiative we have removed obstacles to the development of more appropriate care for people outside NHS institutions and provided greater flexibility in the operation of jointly financed schemes. These received a record level of Welsh Office support this year, as did central funding for special NHS psychiatric developments.
  Taken together, these initiatives represent an unprecedented response to the needs of mentally handicapped, mentally ill and the elderly. Of course, there are local difficulties—if there were not, we would not be giving priority to the expansion of community care and support—and any system must rely on the good sense of health and social services authorities working together to ensure that people get the care that they need. In general, they show this good sense.
  In the sphere of regional health services we have vigorously sought out where inadequacies exist and we are bringing forward plans to meet problems before they become entrenched. Our announced plan for expanding renal dialysis may well put Wales at the head of the European nations league table by 1985, and the provision of beds for the burns and plastic surgery specialty is the highest rate of any region in the United Kingdom. Nor do we overlook new medical technologies. A decision on a regional bone marrow transplant service will be made very soon, and the genetics centre will be housed in its own purpose-designed building. And in heart surgery, where
  298
  we inherited a shortfall, the number of operations are planned to rise to 600 by the end of this year—nearly two and a half times as many as in 1979. Notwithstanding the Government's achievements for the NHS — the record funding and the growth in the numbers of men and women providing direct patient care—we recognise that there remain in Wales inequalities between areas and by comparison with England in the incidence of disease.
  It is nothing new to be told that the toll of death in Wales from heart disease, especially among middle-aged men, has been a cause of real concern for many years. What is new is the determination to tackle the problem. As I have already said, in the short term the number of heart operations to be performed annually in Wales will be increased to the full limit of present facilities. Within the next few years, there will be major investment to double the size of those facilities.
  The hon. Member for Gower drew attention to deaths among the newly born and among very young children. He had a right to do so because this is an important issue which, for the families involved, is a deep human tragedy.
  Having acknowledged that, I suggest that the hon. Gentleman underestimates the real progress which has been achieved, especially in the past three or four years. For many years Wales has had a rate of perinatal mortality consistently above those for England and Scotland. However, this hides the fact that the numbers and rate of perinatal deaths have dropped by half over the past 10 years. Moreover, the fall has been most dramatic in the past few years. In 1980 and 1982 the rate for Wales was actually below that for both Scotland and England.
  Historically, Wales has done relatively better in respect of infant mortality. In six of the past eight years, the Welsh rate has been below—
  The Question having been proposed after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at three minutes to One o'clock.

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Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Norwich.

Alcohol Consumption During Pregnancy
Lord Avebury: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what information they have about the effects of alcohol consumption by the mother on the foetus and on the later development of the child; and what steps they will take to advise women of childbearing age.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur): My Lords, heavy drinking during pregnancy can undoubtedly harm the foetus, but expert opinion is divided as to the extent to which lighter intakes are harmful, and whether there is a threshold below which it is safe to drink. With the present state of knowledge, it is sensible to keep alcohol consumption during pregnancy as low as possible. However, I am medically advised that strong warnings that pregnant women must cut out alcohol altogether could cause unjustified and possible harmful feelings of guilt and anxiety. Expert opinion has been taken into account by the Health Education Council in preparing their new publications on alcohol and on pregnancy.
Lord Avebury: My Lords, has the noble Lord seen the text of the new advice given by the Health Education Council, which is that to be absolutely safe a woman must not drink alcohol while she is pregnant or while she is contemplating pregnancy? Has the noble Lord seen the evidence that was presented to a recent conference held at the British Medical Association where evidence was presented by, in particular, some general practitioners from Glasgow showing that indeed small quantities of alcohol drunk during pregnancy had an effect on the birth weight of infants?
Lord Glenarthur: Yes, my Lords, I am aware of both the points which the noble Lord makes. The fact remains that expert opinion is divided as to the extent to which lower alcohol intakes are harmful to the foetus and whether there is a threshold below which it is safe to drink at all. But there is no doubt, as the noble Lord will know, that alcohol passes from the expectant mother to the foetus. Regarding birth weight and what effect not drinking alcohol has on it, the answer is that in general the less one drinks, the better. There is no denying that alcohol is harmful; but nevertheless there are other reasons, which I explained in my original Answer, which make it not necessarily correct always to condemn those who drink a little.
Baroness Macleod of Borve: My Lords, can my noble friend the Minister tell the House what are the ages of childbearing for women?
Lord Glenarthur: My Lords, not off the top of my head; but I think my noble friend knows the answer to that perfectly well herself.
Lord Ennals: My Lords, bearing in mind that it is recognised that there is no fixed level that one can set, may I ask this question. Does not the Minister feel that he ought to be giving rather stronger advice to pregnant women, bearing in mind the report as long ago as 1979 of the Royal College of Psychiatrists which gave some strong evidence about the effect of heavy drinking by expectant mothers on damaging the foetus? It also referred to the fact that about 40 per cent. of the cases that were concerned in the foetal alcohol syndrome were born either abnormally small, had hare-lips or in some other way had a defect. Is it not really beholden upon the Government to give the strongest advice to expectant mothers that drinking of alcohol except at a very modest level is extremely unwise during pregnancy?
Lord Glenarthur: My Lords, I think I indicated when I answered the noble Lord's original Question and his supplementary that drinking alcohol does not necessarily do a great deal of good—in fact it can do harm. However, I also explained that to say out loud that any drinking produces dangerous results for babies also presents difficulties because it can lead to unjustified feelings of guilt and anxiety when a baby is born with some problem which might—or equally well might not—be due to alcohol consumption during pregnancy.
Baroness Gardner of Parkes: My Lords, does the Minister agree that this is part of a larger problem in terms of the effect of alcohol as a systemic poison on women? Has he seen the recent research which makes clear that the alcohol tolerance level of a woman is only half that of a man? Does he not think, in these days of equality, that that is one time where more publicity should be given for the woman to be unequal in attempting to match drinks?
Lord Glenarthur: My Lords, there are lots of reasons why women have less tolerance—if that is the right word—to alcohol than men. So far as dissemination of knowledge is concerned, the Health Education Council, in the light of their expertise in health education, have been discussing with the department how best the state of knowledge can be passed on to those who need it. I have with me—and I shall put it in the Library—a new publication called A Guide to Sensible Drinking—That's the Limit, and I shall ensure that that is placed in the Library for the noble Baroness to examine at her leisure.
The Earl of Lauderdale: My Lords, can my noble friend confirm that at least it is all right for husbands?
Lord Glenarthur: Yes, my Lords, I can certainly give my noble friend that assurance.
Baroness Gaitskell: My Lords, would it not be a good idea to allow a certain amount of alcohol to be consumed during the youngest days of a person's life, and get them a little immune to it? A lot of people make fools of themselves later on in life.
Lord Glenarthur: My Lords, I think that that flies somewhat in the face of the recommendations of the Royal College of Obstetricians and the British Peadiatric Association. Nevertheless, I shall make sure that they bear in mind what the noble Baroness feels about it.
Lord Gisborough: My Lords, can by noble friend say whether there is any effect when men are drinking when, in his own words, their wives are contemplating pregnancy?
Lord Glenarthur: My Lords, I do not think I shall be drawn any further by my noble friend.
Lord Avebury: My Lords, does the Minister not agree that pregnant ladies are unlikely to see the advice in a publication placed in the Library of your Lordships' House? Therefore, will not the Government take steps to make sure that the Health Education Council's excellent booklet is as widely disseminated as possible, and that in particular the paragraph referring to drinking during pregnancy is prominently displayed in the surgeries of general practitioners?
Lord Glenarthur: My Lords, I will take the noble Lord's suggestion to my right honourable friend to see what can be done. The Health Education Council has published the leaflet to which I have referred; but the fact remains that at the end of the day it is up to the woman concerned whether or not she drinks alcohol.
Lord Blyton: My Lords, is the Minister aware that it is my experience that a pregnant woman will do what she wants to do without any guidance?
Lord Glenarthur: My Lords, I am not quite sure how to reconcile the noble Lord's views on what he feels about being pregnant with what others might feel about it. Nevertheless, I am sure that others will take note of his view.

Renewable Energy Sources: Research
2.46 p.m.
Lord Sandys: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what is the projected level of Government expenditure on research and development into renewable sources of energy and how this compares with expenditure in 1978–79.
Viscount Long: My Lords, my department expects to spend about £10 million on research and development relating to renewable energy sources in the financial year to 31st March 1984, and hopes for
924
a modest increase in this expenditure in real terms in the following financial year. This compares with expenditure in 1978–79 of £3.7 million.
Lord Sandys: While thanking my noble friend for an encouraging reply, may I ask whether my noble friend can tell the House whether Her Majesty's Government are contemplating resubmitting an application to the EEC non-nuclear programme for 1984–89 and whether the work being done in British universities throughout the country and in field studies in Carmarthen will be applicable, my Lords?
Viscount Long: My Lords, regarding the first part of my noble kinsman's Question, the EEC's second non-nuclear R and D programme lasting from mid-1979 to mid-1983 allocated over 60 million ECUs, or about £36 million, to solar, biomass, wind and geothermal energy work. The United Kingdom received 18 per cent. of the total expenditure, of which about one-third was spent in the private sector and the remainder in the public sector. Most went to universities and scientific institutions—for example, the Natural Environment Research Council. The Commissioner's proposals for a follow-up programme are under consideration by the Council of Ministers.
In reply to the question of Wales and Carmarthen, expenditure in Wales on renewables research in 1983–84 is expected to be about £0.4 million mostly on a vertical access windmill in Carmarthen.
Lord Stoddart of Swindon: My Lords, will the noble Viscount confirm that spending on new and renewable sources of energy has fallen by roughly one-third from a peak of £17.3 million in 1981 to an expected £11 million, as he said, in the current financial year? Does this mean that the Government are giving a lower priority at present to renewable sources? Could he also say why Britain spends so little on renewables in comparison with countries such as Germany, France and Italy, which spend, respectively, £50 million, £25 million and £26 million annually on renewable sources?
Viscount Long: My Lords, in reply to the latter part of the noble Lord's question, energy supply problems and strategies to meet energy demands vary from country to country. The United Kingdom's access to indigenous fuel supplies means that we do not have to spend as much on renewables as some other countries.
The Earl of Lauderdale: My Lords, will my noble friend agree that no matter how much we spend on research into renewables that is unlikely to help us very much before the end of the century? Will he say whether research into wave power has been disappointing as research into geothermal and wind energy is proving rather encouraging?
Viscount Long: My Lords, I am most grateful to my noble friend for his supplementary question, because research is encouraging, though rather slow at times.
Lord Leatherland: My Lords, may I ask whether as this Question deals with renewable sources of energy, the Minister can tell us how we get it?
Viscount Long: From Mother Earth, my Lords.
Lord Ezra: My Lords, will the noble Lord the Minister kindly advise us whether there is a broad strategy on research and development into energy and whether the research and development undertaken on renewable sources is related to the research and development effort into other forms of energy? Also, is this kept constantly under review by the Government?
Viscount Long: My Lords, of course, not only with this Government but with any Government, energy—renewables and any other type of energy—is always under consideration.
Lord Sandys: My Lords, may I ask my noble friend in this connection whether, in view of the fact that one of the Severn Barrage schemes was designed in 1846, this is likely to be a very lengthy programme of research and development before fulfilment is achieved?
Viscount Long: My Lords, that sounds a very windy one to me, but the Secretary of State announced on 12th May 1983 that the department would contribute up to £250,000 over two years to a jointly-funded study on the barrage by the Severn Tidal Group—McAlpine, GEC, Taylor Woodrow, NEI and Balfour Beatty—directed towards assessment of the technical and financial viability of a barrage built but not operated by the private sector.
Lord Elwyn-Jones: My Lords, in view of the fact that the Principality is famous for its windmills, is it not a matter of satisfaction that the Carmarthenshire windmill has come into existence? The fact that it happens to be my native country is purely coincidental. Can the noble Lord say whether this is purely experimental or whether it is intended to produce electricity and, if so, to what extent? And is this to be the first of many, in view of the importance of this development?
Viscount Long: One is hoping, my Lords, that it is going to be one of many. It is a start. There is a certain amount of research still going on since the failure of two of these particular projects, one in the United States of America and one in West Germany. From the skills of the people over there, we have been able to learn a lot more, so that in Carmarthen we are really working from the expert knowledge that we are being given.
Lord Stoddart of Swindon: My Lords, arising from the noble Lord's reply to my previous supplementary question—the reply that this country does not need to spend so much on renewables because of our indigenous sources of energy supply—can he say why in those circumstances we spend £220 million per annum on nuclear research?
Viscount Long: My Lords, because I am on the subject of renewables, I really have to say that that is somewhat outside the Question.
The Earl of Lauderdale: My Lords, can my noble friend add this further information? Can he say
926
whether there has yet been any serious environmental objection to the experiments with wind turbines in Carmarthenshire and also in the Orkneys?
Viscount Long: My Lords, I cannot give my noble friend that information off-hand. Perhaps I may let him know about that.

Guinea: Diplomatic Representation
2.53 p.m.
Lord Hatch of Lusby: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they intend to upgrade British diplomatic representation in Conakry, the Republic of Guinea.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, we have no present plans to do so.
Lord Hatch of Lusby: My Lords, can the noble Lord confirm that the present diplomatic representation so far as Guinea is concerned is based on Dakar and Senegal and that that embassy covers Senegal, Mali, Upper Volta and Niger, none of which countries has substantial, if any, trading relations with this country, whereas Guinea is one of the richest countries in Africa and many business interests from various countries are represented there? Would it not be sensible and profitable for this country to have such diplomatic representation in Conakry as would assist the development of British business interests in that country?
Lord Trefgarne: My Lords, I do not think that one wants to overstress the trade relationship between the United Kingdom and Guinea. We constitute only 1.5 per cent. of their supplies and take only about 2 per cent. of their exports.
Lord Paget of Northampton: My Lords, is the noble Lord aware that the dictatorship of President Sékou Touré is probably the most appalling of all the régimes under which the unfortunate population of Africa is suffering, and that, according to the United Nations, he has 2 million exiles outside his small country? Is he also aware that the human rights record is quite deplorable, that Sékou Touré has reduced the GNP of what my noble friend described as a rich country almost to its bottom level, that of less than 270 dollars per head; and that it is quite deplorable that we should recognise such a régime at all?
Lord Trefgarne: My Lords, as the noble Lord will recall, before today I have answered questions about the criteria that we apply in these considerations. It is not for me, today at any event, to pass judgment one way or another on President Sékou Touré's régime; although of course we seek to condemn breaches of human rights wherever they may occur.
Lord Hatch of Lusby: My Lords, if the noble Lord has told the House that there is such a small

927
percentage of Guinea trade connected with this country, is this not a condemnation of this country rather of Guinea in view of the fact that many other industrial countries in the world are highly represented diplomatically and commercially in this developing country? Could the noble Lord tell the House something about the position which he has mentioned in answer to previous questions of mine about the debt situation between Guinea and this country? Have the Government had any thoughts about the barter system which, I understand, other European countries are conducting for the removal of debts with the Government of Guinea?
Lord Trefgarne: My Lords, as the noble Lord may recall from earlier exchanges that he and I have had on this subject, the Guinean debt was rescheduled, I think in 1976—the debt amounting then, I think, to about £6 million—since which time we have received only one payment under the rescheduling arrangements. They are now substantially in arrears therefore not only with ourselves but with the world at large.

Nuclear Arms Control: U.S. Policy
2.56 p.m.
Lord Jenkins of Putney: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware that the United States Government is now committed to a nuclear war-fighting strategy and has abandoned the policy of deterrence and in view of the widely held opinion that this will lead to the destruction of mankind what action they will now take to save themselves and the rest of humanity from this ultimate disaster.
Lord Trefgarne: No, my Lords. The United States Administration have made absolutely clear their commitment to a strategy of deterrence. In his annual report to Congress for the fiscal year 1984, Mr. Weinberger reiterated this strategy. He said:
"First, our strategy is defensive. It excludes the possibility that the United States would initiate a war or launch a pre-emptive strike against the forces or territories of other nations. Second, our strategy is to deter war. We maintain a nuclear and conventional force posture designed to convince any potential adversary that the cost of aggression would be too high to justify an attack".
Lord Jenkins of Putney: My Lords, is the noble Lord aware that the latest air/land battle concept of the American army is even more dangerous than flexible response? Is he further aware that, while it is welcome to hear President Reagan in less belligerent mood, it is necessary for these better words to be followed up by a readiness to discuss the reality of nuclear exchange between the Soviet Union and the West? Finally, is he aware that the Stockholm Conference can be the start of this process if it is treated seriously on both sides?
Lord Trefgarne: My Lords, I certainly hope with the noble Lord that the Stockholm Conference will produce the sort of results to which the noble Lord has
928
referred; but I have no doubt that it will be a long and difficult process. On the general concept of our defence posture I say again, as I have said to your Lordship on many occasions and as many others of my noble friends have said from this Bench, our strategy is one of deterrence. We seek to avoid war, not to fight one.
Lord Gladwyn: My Lords, would not the noble Lord agree that the only conceivable point of "deterrence" is to have the assured capacity, on a possible second strike, to inflict totally unacceptable damage on a possible nuclear adversary and that accordingly no attempt should be made to attain what is called "nuclear superiority?"
Lord Trefgarne: My Lords, as the noble Lord, Lord Jenkins, has already said, there is a need to have a strategy of flexible response—although I appreciate that the noble Lord does not agree with that. We have such a strategy within the policy of deterrence to which I have referred and we need to be able to respond at any level.
Lord Boyd-Carpenter: My Lords, will my noble friend confirm that the placing on the Order Paper of this House of allegations of this nature against our most important ally can bring no comfort to anybody but the Soviet Union?
Lord Trefgarne: My Lords, the motives of the noble Lord, Lord Jenkins, are for him and for him alone; although I must say that I share some of the views of my noble friend.
Lord Bishopston: My Lords, will the Minister give the House the assurance that the Government's defence policy is still based on the use of conventional weapons and that the enormous cost of nuclear weapons will not deprive us of those resources? If he cannot give us that assurance, will he therefore be admitting that in the event of a serious emergency the United States and the United Kingdom will be forced to go nuclear right from the start with the terrifying prospects which that would bring?
Lord Trefgarne: My Lords, as I say, our policy is one of flexible response. That includes the capability to respond with conventional weapons if the occasion so requires.
Lord Cledwyn of Penrhos: My Lords, should we not now concentrate on the opportunity which the European Security Conference gives us in Stockholm? Would the noble Lord say whether Her Majesty's Government have it in mind to take the initiative in seeking to reconvene the START and INF talks in Geneva, which broke down recently? While we welcome the words uttered by President Reagan yesterday in Washington, would the noble Lord not agree that the important thing is to move away from just words and turn to a real dialogue and a real exchange of views? Would the noble Lord give the House an assurance that that is currently the objective of Her Majesty's Government?
Lord Trefgarne: My Lords, I certainly agree that it would be highly desirable for the INF and START

929
talks to reconvene. I am not certain, however, that the position is quite so black as the noble Lord suggests with regard to the START talks, because although a resumption date has not yet been set we hope very much that the Russians will agree to the setting of such a date in due course. They say they are reviewing their position, and if that be so perhaps it is not too surprising that they have yet to agree a date for the resumption.
Lord Peyton of Yeovil: My Lords, may I ask my noble friend whether he would not congratulate the noble Lord, Lord Cledwyn, on the very deserving effort that he made to turn a mischievous Question into a serious one?
Lord Jenkins of Putney: My Lords, is it not the case that the American nuclear posture is of great concern to many reasonable people throughout the country, and that if any noble Lord translates a concern of that sort into a pro-Soviet position it is merely evidence of a closed mind, which itself is dangerous?
Lord Trefgarne: My Lords, I am aware that there is opposition to the American point of view in these matters from some people in this country. I believe it is a tiny minority of our people, as evidenced at the last General Election.

Business
Lord Denham: My Lords, it may be for the convenience of the House if I announce that dinner will be available at the usual time of 7.30 this evening. The Committee stage of the Roads (Scotland) Bill will be adjourned at about 7.30 p.m. for approximately an hour.

Restrictive Trade Practices (Stock Exchange) Bill
3.3 p.m.
The Chancellor of the Duchy of Lancaster (Lord Cockfield): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee—(Lord Cockfield.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 1 [Exemption of certain agreements relating to The Stock Exchange]:
Lord Bruce of Donington Lord Bruce of Donington had given notice of his intention to move Amendment No. 1:
Page 1, line 5, at end insert ("for the time being").
The noble Lord said: This amendment was put down by me immediately before the Christmas Recess in the knowledge that the Committee stage would be taken shortly after we resumed. The Christmas season gave me occasion to meditate on this particular amendment, and I came to the conclusion that all Bills that come before Parliament are of necessity for the time being, because they can always be amended or
930
subsequently replaced by another Bill. Therefore, in strict philosophical terms this amendment is quite unnecessary, and I therefore do not propose to move it.
[Amendment No. 1 not moved.]
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 2:
Page 1, line 13, after ("State") insert ("or").
The noble Lord said: Your Lordships will recall that Clause 1(1) of the Bill contains a provision for an agreement in respect of any of the matters referred to in subsection (1)(a) to be made between the Stock Exchange and the Secretary of State, the Treasury or the Bank of England, or any two or more of them. The purpose of this amendment, taken in conjunction, by leave of your Lordships, with Amendment No. 3, is to eliminate one of the four parties from this consultative process.
Amendment No. 3: Page 1, line 13, leave out from ("Treasury") to end of line 14.
In my view—and I hope I may carry your Lordships with me—it should be between three parties only, and without the rather loose option of a selection of any three of them. It is as well, when a Bill goes through Parliament, that all parties to the sections contained within it should know clearly in advance exactly what their responsibilities are. There is no point in having four bodies on continuous alert, as it were, for the purposes of this Bill and then selecting only three of them on an arbitrary basis.
Looking at it from that point of view, as well as from the point of view of some other matters on which I shall address your Lordships, I came to the conclusion that the Bank of England ought not to be involved in this. If there were any agreements to be come to in conformity with what is judged to be the public interest, the Secretary of State, the Treasury and the Stock Exchange would be quite sufficiently important and significant, and would have sufficient resources, to arrive at the necessary agreements. This is, as I say, on the hopeful assumption that when the agreements are arrived at they will be in conformity with the law, as has been the position up to this time.
The Bank of England is a very august institution, and your Lordships will be well aware that it was founded not by an Englishman but by a Scotsman called Paterson, a matter from which my native country can presumably take some comfort. Immediately following the last war the Bank of England was nationalised, and it is in fact a state bank operating for all practicable purposes under the general direction of the Government. But it is a state bank, and in my view it ought to remain aloof from matters of this kind.
The Bank of England enjoys an enormous reputation, and, one would hope, in some ways a reputation for impartiality almost analogous to that of the BBC. I well remember, when I was an articled clerk before the war, looking out of the window and seeing, every afternoon at about 4 o'clock, a small number of guardsmen headed by an officer marching along Queen Victoria Street with bayonets fixed, as they are permitted to do, going to the Bank of England. I can remember being very much impressed in those days,

931
being very young at the time, and I thought to myself, "The Bank of England is one of the foundations upon which the country rests". That being so, it ought to be aloof.
I cannot help feeling that, within the general context of this Bill, the Bank of England is being propelled into a situation where it is regarded as part of a general conservative establishment (I use the term with both a big "C" and a little "c")—the City. I think this unfortunate. I have noticed—and I have to mention it in this context here—that over the years, and particularly since the end of the war, the Bank of England, through its spokesmen, has become ever more closely identified with the Conservative Party itself.
I choose my words carefully. I do not wish to suggest that distinguished governors of the Bank of England, whom we are fortunate enough to see here from time to time—it would be difficult for me to state the number, but I can think of at least three distinguished ex-governors of the Bank of England who grace our House with their presence from time to time—are doing anything improper, but they have been known, growingly over these last few years, as identifying themselves with anti-Labour financial policies and pro-Conservative financial policies.
I am bound to say that I have found, as others have found—and I deliberately use this occasion to mention it—on the occasions when Labour Chancellors of the Exchequer turn up at these extremely welcoming and lush functions of City banquets to receive scarcely veiled lectures from governors of the Bank of England as to the inequities of their policies, that that detracts from the reputation for impartiality with which any holder of the office of governor and the Bank itself ought to be associated.
It would be a very good thing if the Bank of England took steps for its governor, and for those who publish its reports, to make it clear that they are aloof from the party struggle. Although they are at liberty to give advice from time to time—and I am bound to say, in parenthesis, that they have not yet taken many steps to dissociate themselves from the disastrous monetary policies that have been pursued over the last four years—it would be a great advantage to the country.
For this reason, it would be wise if we relieved the Bank of England of this responsibility of working closely in association with the Stock Exchange, and left it to the Secretary of State and the Treasury to do this, in the hope that the Bank of England may be able to resume its impartial—perhaps almost aloof—stance, which members of the public, members of all parties and Members of Parliament ought to be able to expect from it. I beg to move.
3.13 p.m.
Lord Cockfield: I am grateful to the noble Lord, Lord Bruce of Donington, for the complimentary remarks which he made about the Bank of England in the opening part of his remarks, but I cannot, I am afraid, agree with many of the things that he said in the latter part of his speech moving this amendment. I well remember the day when the late Mr. Hugh Dalton—Lord Dalton as he subsequently became—nationalised the Bank of England in 1946. It
932
was thought at the time that this would restrict the independence and the independence of mind of the Bank of England. This has not, in fact, happened. The Bank has always shown great independence of mind, I think to the national good, and governors of the Bank have never hesitated to speak their minds in public as well as in private. Of course, it is not always acceptable to everybody to have to listen to things with which they do not agree. Nevertheless, the contribution which the Bank of England has made to many of our debates on economic and financial matters has been of very great value.
There is one particular incident—and I am sure the noble Lord will not mind my drawing his attention to it—which occurred in 1976, when it was the Bank of England which masterminded the financial measures which were taken ultimately through the IMF to bail out this country when it was in quite severe financial difficulty. I remember quite clearly that tribute was paid at the time by senior members of the Labour Government to the part played by the Bank of England. I think that the Bank has proved itself to be an institution of very great value to the country as a whole.
I should like to say, just by way of introduction, that I entirely appreciate that the noble Lord, Lord Bruce of Donington, will not agree with many things said, either by the governor or in the Bank's quarterly review, but I imagine that that equally goes for many things said by bankers in other countries in the world—in the United States and elsewhere.
So far as the amendment itself is concerned, it relates to paragraph (b) of subsection (1) of Clause 1 of the Bill. The purpose of paragraph (b) arises out of the monitoring arrangements which the Government have set up. The Stock Exchange have agreed that they will dismantle certain of their important restrictive practices, and the Government felt that it was not right to leave matters just there, and that progress should be very carefully monitored. It was felt that the right people to monitor it were the Secretary of State for Trade and Industry and the Bank of England. The Bank of England was joined in this monitoring process, because it has great experience and knowledge of the City of London, and it could bring that expertise to bear for the general benefit.
What we are concerned to do here is to ensure that the monitoring is effective, and our feeling is that the inclusion of the Bank of England will make the monitoring more effective than it otherwise would be. If you have a monitoring process of this kind, it is important that any agreement that may be reached between the people who are parties to the monitoring should not itself be subject to the restrictive practices legislation. This, quite simply, is the reason for this provision in the Bill.
There is nothing unusual in associating the Bank of England with a process of this kind. For example, there is an exemption from the Restrictive Trade Practices Act for agreements relating to the Bank's supervision of some other financial institutions and markets in paragraph 6 of the Schedule to the Restrictive Trade Practices (Services) Order 1976. That is an order which was brought into effect, quite properly, during the period of a Labour administration, and in associating the Bank with the present monitoring and

933
relieving it from the Restrictive Trade Practices Act in relation to that monitoring—it is important to make the point that the paragraph states
"any agreement with respect to any of those matters";
that is, the matters dealt with in that Act—we are simply proceeding along a path for which there is precedent, which we think is a perfectly sensible and reasonable thing to do.
Lord Taylor of Gryfe: We on these Benches will support the noble Lord, Lord Bruce of Donington, in his contention, not that we subscribe to everything he said in proposing his amendment. This Bill is designed to permit the Stock Exchange to be exempt from the rules governing restrictive practices, on condition that they apply certain important changes in their practices.
The rate at which these changes are implemented can be the subject of debate in the next few years. This may even be affected by some of the recommendations of the Gower Committee, which will be the subject of a good deal of debate in the next year or two, affecting financial institutions. It is because we desire that the Bank of England should retain its independence, its integrity and the great respect which it enjoys, not only in the nation but internationally, that we are anxious to keep the Bank of England out of this process.
The Council for the Securities Industry might have been involved, but that is not provided for in the Bill. I should have thought, however, that in this country the balance which we have achieved in the Bank of England is just about right. It is the envy of many other countries. It has always been a disaster when a country has made the state bank an instrument of Government political policy. It is because we want to keep the Bank of England out of this contentious area that we would subscribe to the amendment moved by the noble Lord, Lord Bruce of Donington.
Lord Boyd-Carpenter: The noble Lord, Lord Bruce of Donington, was very unfair in his observations with reference to the political impartiality of the Bank of England. Indeed, he indulged rather entertainingly in a curious, subconscious transition of thought when he objected to Governors of the Bank of England (I believe he was referring to their speech at the bankers' dinner at the Mansion House) being somewhat unenthusiastic about the policies of Labour Governments and then went on to say that he thought they ought to be critical of the policies of Conservative Governments. The noble Lord cannot have it both ways. Either the Governor of the Bank of England should be dumb on these occasions or he should be allowed to express the views which, as a responsible and experienced man, he holds, though to express them with the studied moderation which Governors of the Bank of England always use.
I can draw on my own experience. I had two terms of office at the Treasury and dealt with two successive Governors of the Bank of England. I can tell your Lordships that they showed no unnecessary enthusiasm for supporting the policies of the Government of the day. They gave us their honest, experienced opinion, and for that reason it was of the very greatest value.
934
I, for one—this is the only reason I am intervening on this motion—would like to say that I regret very much that the noble Lord on the Front Bench opposite should have, however moderately, sought to reflect on the complete impartiality in the discharge of their great office of successive Governors of the Bank of England. I think that on reflection the noble Lord will regret having done so.
Lord Diamond: May I, very shortly, endorse eveything that my noble friend Lord Taylor of Gryfe has said and ask also for some explanation which I think would be appropriately attached to this amendment, which relates to the Bank of England? Paragraph (b)(ii) refers to "any two or more of them". If there were only two—that is, if the Bank of England were not included—on every single occasion the Secretary of State and the Treasury would have to be referred to.
What I am not clear about is the position of the Secretary of State. I find it unusual (although I am sure that the Minister who is to reply will be able to give me precedents for this) that there should be a circumstance in which the Secretary of State is sometimes responsible, and therefore answerable to Parliament, while at other times, without Parliament knowing a thing about it, the Secretary of State does not intervene and is therefore not responsible. I should find it very difficult to understand a situation in which the Secretary of State was sometimes responsible, in having to be a party to this kind of agreement, while at other times, without anybody knowing, because one could just pick on any two of three, he was not responsible. I hope that the Minister will be good enough to say what is likely to happen in practice and how that will be reconciled with the wording of the Bill if it is left undisturbed.
Lord Cockfield: I am grateful to my noble friend Lord Boyd-Carpenter for his intervention. I think that there is—for it came out in most of the speeches which were made—very great respect for the Bank of England and for the part that it has played. There is always a risk that nationalisation of a concern, or its being taken over by Government, may affect its impartiality. One of the things that we have been very appreciative of is the fact that in the case of the Bank of England this has not happened at all. I should like, therefore, to go further and say that I can see no reason why joining the Bank of England in this process of monitoring the progress made by the Stock Exchange in dismantling certain restrictive practices will prejudice the independence of the Bank of England. In fact, on the contrary; the Bank of England comes into this process by virtue of its independence.
It is because an independent view of that kind is so important that we felt that the monitoring ought not simply to be done by the Secretary of State for Trade and Industry. The Treasury comes into so many matters, as the noble Lord, Lord Diamond, knows. As a matter of precaution, one needs to add their name to almost anything. But, instead of the monitoring being restricted to the Secretary of State for Trade and Industry, we felt that there was also great merit in bringing in an independent mind to look at these matters and that the Bank of England was the pre-

935
eminent authority in the City of London, with the widest knowledge and understanding of these matters.
I assure the noble Lord, Lord Taylor of Gryfe, that this is not in any way a failure to appreciate the importance of the Council for the Securities Industry, which has done a very good job and still has a part to play in ensuring that all the parties to the monitoring process are informed about the views of institutional investors and others. But if one is looking for an independent body, it is the Bank of England, perhaps, rather than the Council for the Securities Industry, which is the body in point. I agree entirely with the noble Lord, Lord Taylor of Gryfe, that when Professor Gower's report is published tomorrow it may contain a number of points that will require very careful consideration, but that is a matter for the future rather than a matter for today.
The noble Lord, Lord Diamond, said that sometimes the Secretary of State seemed to be responsible for what went on and sometimes he was not—that sometimes he took action for which he was answerable to the House and that sometimes he took action for which he was not answerable to the House. I am not entirely certain just what the noble Lord, Lord Diamond, has in mind, but I imagine that what he means is this. There are occasions when the Secretary of State performs statutory duties under the terms of particular legislation, but there are many, many other things that every Secretary of State does which do not arise directly from the enforcement of specific statutory provisions.
The monitoring process is a non-statutory function. There is no provision in the Bill or in the legislation that there should be monitoring. Therefore the Secretary of State is carrying this out as a non-statutory duty. In the course of this monitoring there is always the risk that something may be done which legally counts as an agreement. The purpose of the paragraph in this particular subsection is to ensure that if this happens the action is not itself a registrable agreement. It is just as simple as that.
If the noble Lord is concerned about the question of Parliament knowing what goes on, there is a simple answer: that it is always open to noble Lords to ask questions on the progress of the monitoring process. We would wish to be as open as possible. Certainly the Government have been, and will no doubt continue to be, pressed to give information on this point. There is no question of trying to avoid revealing what in fact emerges from the monitoring process. On the contrary, the whole point of the monitoring process is to ensure that progress towards dismantling the various restrictive practices is monitored and, in due course, publicly known. Most of it, of course, is known already because the Stock Exchange itself has shown no reluctance to tell people exactly what it is doing. A great deal of progress has been made, and this is a matter of public knowledge.
Lord Bruce of Donington: I am most grateful for the courteous nature of the noble Lord's reply to the questions which have been raised by a number of noble Lords. I must, however, take the slightest
936
possible exception to the remarks of the noble Lord, Lord Boyd-Carpenter. I do not intend, and never do intend, any personal affront to any Governor of the Bank of England or to any of its personnel. But I am bound to say that I do not regard it as being a cardinal sin to raise misgivings from time to time as to its publicly expressed attitude.
I am fully sensible of the observations of the noble Lord, Lord Cockfield, concerning the help which the Bank of England was able to give in 1976. It is a matter of some wry reflection that, owing to a Treasury error at that time in its estimate of the public sector borrowing requirement—an error of some £4,000 million too much, and £3,000 million too much the next year—it emerged in the event that the aid we received was not required anyway. In fact, as the noble Lord well recalls, it was very speedily repaid. This is not to deny or to disparage in any way the efforts made by the Bank of England to assist the Government and the country as a whole on those occasions.
One does, however, wish—and I must repeat this, without, I sincerely hope, giving offence—that the economic researchers in the Bank of England, its advisers, and those who are responsible for enunciating its policies showed a rather greater degree of independence from current Conservative economic thought. I trust that in so saying I shall not be regarded by the noble Lord, Lord Boyd-Carpenter, as exceeding the bounds of conventional courtesy, or, indeed, real courtesy, in these matters.
The independence of the Bank of England in the present circumstances is under rather peculiar conditions. Your Lordships will be aware that I myself and we on this side of the House consider that certain aspects of this Bill go to the root of this country's constitutional procedures. I shall be dealing with that aspect of the matter in a later amendment. But there is no guarantee by the Government so far that the agreements arrived at ultimately, and in which all these participants are going to take part, will not result in an agreement being reached which, if this Bill had not been passed, would not have been in conformity with the Restrictive Practices Act, Fair Trading Act or Competition Act 1980.
These are controversial matters. If subsequently it were found that it would have been rather wiser for the Director General of Fair Trading to have proceeded with the action initiated by him with the agreement of the Government, it would be unfortunate if the Bank of England as an institution were seen as condoning in the existence of one or two clauses of the agreement which, but for the passing of this Act, would have been illegal.
It is exactly to preserve that degree of aloofness and independence—aloofness from the controversy which, I regret to inform the noble Lord, is certainly not finished in connection with this matter—that this amendment is moved. It is not for any disparagement of the capabilities or the intentions of the Bank of England itself. I beg to move.
3.35 p.m.
On Question, Whether the said amendment (No. 2) shall be agreed to?
Their Lordships divided: Contents, 101; Not-Contents, 121.

DIVISION NO. 1

CONTENTS

Allen of Fallowfield, L.

Jenkins of Putney, L.

Amherst, E.

John-Mackie, L.

Ardwick, L.

Kilmarnock, L.

Attlee, E.

Leatherland, L.

Aylestone, L.

Listowel, E.

Banks, L.

Llewelyn-Davies of Hastoe, B.

Beaumont of Whitley, L.

Lloyd of Hampstead, L.

Beswick, L.

Lloyd of Kilgerran, L.

Birk, B.

Lockwood, B.

Bishopston, L.

Mackie of Benshie, L.

Blyton, L.

Mais, L.

Boston of Faversham, L.

Mayhew, L.

Bowden, L.

Melchett, L.

Briginshaw, L.

Mishcon, L.

Brooks of Tremorfa, L.

Molloy, L.

Bruce of Donington, L.

Monson, L.

Caradon, L.

Nicol, B.

Carmichael of Kelvingrove, L.

Oram, L.

Cledwyn of Penrhos, L.

Peart, L.

Collison, L.

Pitt of Hampstead, L.

Cooper of Stockton Heath, L.

Ponsonby of Shulbrede, L. [Teller.]

Cudlipp, L.

David, B. [Teller.]

Raglan, L.

Davies of Penrhys, L.

Rathcreedan, L.

Dean of Beswick, L.

Rhodes, L.

Diamond, L.

Roberthall, L.

Donaldson of Kingsbridge, L.

Rochester, L.

Donnet of Balgay, L.

Sainsbury, L.

Elwyn-Jones, L.

Seear, B.

Ennals, L.

Sefton of Garston, L.

Ewart-Biggs, B.

Serota, B.

Ezra, L.

Simon, V.

Fisher of Rednal, B.

Stallard, L.

Fulton, L.

Stedman, B.

Gaitskell, B.

Stewart of Alvechurch, B.

Gallacher, L.

Stewart of Fulham, L.

Gladwyn, L.

Stoddart of Swindon, L.

Glenamara, L.

Stone, L.

Gormley, L.

Strabolgi, L.

Graham of Edmonton, L.

Taylor of Blackburn, L.

Grey, E.

Taylor of Gryfe, L.

Grimond, L.

Tordoff, L.

Hale, L.

Underhill, L.

Hampton, L.

Wallace of Coslany, L.

Hanworth, V.

Walston, L.

Hatch of Lusby, L.

Wells-Pestell, L.

Howie of Troon, L.

Whaddon, L.

Hughes, L.

Wigoder, L.

Irving of Dartford, L.

Wilson of Rievaulx, L.

Jacques, L.

Winstanley, L.

Jeger, B.

Wootton of Abinger, B.

NOT-CONTENTS

Adeane, L.

Clancarty, E.

Airey of Abingdon, B.

Cockfield, L.

Alexander of Tunis, E.

Cottesloe, L.

Allerton, L.

Craigavon, V.

Alport, L.

Crathorne, L.

Ampthill, L.

Cullen of Ashbourne, L.

Annan, L.

Darnley, E.

Atholl, D.

Daventry, V.

Bauer, L.

Davidson, V.

Belhaven and Stenton, L.

De Freyne, L.

Bessborough, E.

Denham, L. [Teller.]

Blake, L.

Drumalbyn, L.

Boyd-Carpenter, L.

Ebbisham, L.

Brabazon of Tara, L.

Eccles, V.

Broxbourne, L.

Effingham, E.

Bruce-Gardyne, L.

Ellenborough, L.

Caccia, L.

Enniskillen, E.

Campbell of Alloway, L.

Fraser of Kilmorack, L.

Campbell of Croy, L.

Gainford, L.

Chelmer, L.

Gardner of Parkes, B.

938

Gisborough, L.

Mottistone, L.

Glenarthur, L.

Moyne, L.

Gray of Contin, L.

Nathan, L.

Gridley, L.

Northchurch, B.

Grimston of Westbury, L.

Nugent of Guildford, L.

Harvington, L.

Orkney, E.

Hawke, L.

Orr-Ewing, L.

Hayter, L.

Pender, L.

Henley, L.

Penrhyn, L.

Hornsby-Smith, B.

Peyton of Yeovil, L.

Hylton-Foster, B.

Porritt, L.

Ilchester, E.

Portland, D.

Inglewood, L.

Reilly, L.

Ingrow, L.

Richardson, L.

Killearn, L.

St. Aldwyn, E.

Kilmany, L.

St. Davids, V.

Kinloss, Ly.

Saltoun, Ly.

Kintore, E.

Sandys, L.

Lane-Fox, B.

Seebohm, L.

Lauderdale, E.

Selkirk, E.

Lloyd, L.

Sharples, B.

Long, V.

Skelmersdale, L.

Lothian, M.

Stamp, L.

Loudoun, C.

Stodart of Leaston, L.

Lucas of Chilworth, L.

Sudeley, L.

Luke, L.

Suffield, L.

Lyell, L.

Swinfen, L.

McFadzean, L.

Swinton, E. [Teller.]

Mackay of Clashfern, L.

Teviot, L.

Macleod of Borve, B.

Thomas of Swynnerton, L.

Mar, C.

Thorneycroft, L.

Margadale, L.

Trefgarne, L.

Marley, L.

Trenchard, V.

Merrivale, L.

Trumpington, B.

Mersey, V.

Vaux of Harrowden, L.

Middleton, L.

Vickers, B.

Milverton, L.

Vivian, L.

Molson, L.

Waldegrave, E.

Monk Bretton, L.

Whitelaw, V.

Montgomery of Alamein, V.

Wise, L.

Morris, L.

Resolved in the negative, and amendment disagreed to accordingly.
[Amendment No. 3 not moved.]
3.45 p.m.
The Chairman of Committees: The next amendment is Manuscript Amendment No. 3A. If this amendment is agreed to, I cannot call Amendments Nos. 4 and 5.
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 3A:
Page 1, line 15, leave out subsection (2).
The noble Lord said: I am grateful for the noble Lord's co-operation in assenting to the submission of this manuscript amendment. The Committee may be aware that, according to the Marshalled List, I gave notice that I was going to oppose the adoption of Clause 1 of the Bill as a whole. I was advised that that was in effect equivalent to a vote against the Bill on Second Reading, which is not, as I am given to understand, the custom of this House. So as an alternative to doing that, I propose to move the deletion of subsection (2) of Clause 1.
This is the clause by virtue of which Her Majesty's Government seek to abate or in effect withdraw the action which was in process involving the Director General of Fair Trading and the Stock Exchange before the Restrictive Practices Court. On the Second Reading of the Bill I voiced the opinion, which I now

939
reiterate, that this clause makes a complete break with all precedent and is in fact, perhaps not in law, bordering upon the unconstitutional. In his reply to my assertion the noble Lord who wound up the debate—and, therefore, no reply could be made to him immediately afterwards—said this:
"…numerous cases in which action not dissimilar to this has been taken in the fiscal field. May I refer him, for example, to Section 15(7) of the Finance Act 1971 which overturned the decision in Restorick v. Baker (47 Tax Cases, 116)? The law in that case was changed retrospectively, the only exception being where there had been a determination by the commissioners or a court had actually given judgment. Again, Section 86 of the Finance Act 1981 overturned the decision in Berry v. Warnett despite the fact that in that case judgment had been given in the Court of Appeal and that judgment was under appeal to the House of Lords but not then decided. The position simply is that in matters of this kind the decision as to the content of the law is one for Parliament and the Bill therefore is a very proper Bill in that respect."—[Official Report, 15/12/83; col. 380–381.]
Since that debate I have, naturally, refreshed my mind as to the position in the two cases that were referred to by the noble Lord in order that the Committee may judge whether there is the remotest similarity in any way between the two cases cited by the noble Lord and subsection (2) of Clause 1 of this Bill.
In Restorick v. Baker the inspector of taxes in the particular case computed the personal release from income tax to which he was entitled on the footing that under Section 14(4) of the Finance Act 1968 it fell to be reduced by £36. On appeal the respondent contended that since Section 14(4) provided for the personal release to be reduced by £36 for each family allowance, if more than one, it applied only where more than one family allowance was received. The general commissioners allowed the appeal, and the court itself confirmed this.
The alteration to the law was made under Section 15 of the Finance Act 1971, and its effect was to reinterpret just two words. It was to enforce the law as it was thought to be before the case of Restorick v. Baker. In that particular case it was held that because of the words,
"for each allowance if more than one",
there was no clawback where only one family allowance was received. Although the amendment that was made by Section 15 had retrospective effect, it did not affect taxpayers who had obtained a decision from the commission or the courts on or before 16th March. Indeed, all the words of Section 15 were, in fact, designed to reinterpret the Act into something that it had always been assumed to be before. This was therefore a minor technical correction which was made in the taxing statutes on the construction purely of a word, or a series of words, in a section of the previous Finance Act under reference. That cannot in any way be compared with this. Moreover, it should be noted that a judgment had been given. The case had been argued before the commissioners and before the courts; everyone interested had an opportunity of seeing what the evidence was and, as the noble Lord said, it was quite proper for the amending Act to be passed.
Exactly the same considerations apply to the second case, because the Capital Gains Tax Act 1979 provided that,
940
"a gift in settlement is to be treated as a disposal of the entire interest of the transferor in the property which passes into the settlement".
In Berry v. Warnett it was held that the expression "gift in settlement" did not extend to a transfer of property. All that Section 86 did was to substitute the wording in order that a transfer of property was included.
These are very technical matters, which the noble Lord, who has more than a passing interest in taxation matters, and, indeed, myself and other accountants and lawyers, know perfectly well. But they cannot in any way be compared with the action that is proposed in this Bill, which exempts wholesale a particular body of people, or an association of people, from the operation of an Act. Moreover, the subsection itself invokes that exemption prior to the court having reached any kind of decision and prior to any kind of published judgment being made available to anyone. I would say that that is a constitutional impropriety that could create a very undesirable precedent. I could say that in certain circumstances if might favour interests that the noble Lord might not wish to favour. The noble Lord is well aware that Section 26(1) of the Competition Act 1980 provides:
"Where the Court has declared under section 1(3) of the Restrictive Trade Practices Act 1976 that any restrictions or information provisions in an agreement are contrary to the public interest, any party to the agreement or the proceedings in which the declaration was made may, at any time before the declaration comes into effect, submit a revised agreement or draft of a revised agreement to the Court and the Court may declare that any restrictions or information provisions contained in the revised agreement by virtue of which the said Act of 1976 applies or would apply to that agreement are not contrary to the public interest."
The alternative was always available to allow the case to be heard by the Restrictive Practices Court and to allow the Restrictive Practices Court to make a judgment and then, if there were any further matters arising from that, there was a further procedure that could be embarked upon. I believe that that would have been the correct procedure. In this case it certainly is not being invoked and one is bound to wonder why not.
That there is a constitutional impropriety there can now be little doubt. But the reasons now begin to trouble one. Why, after a period of four years, with the approval of successive Governments of different political complexions, of the rectitude of the actions embarked upon by the Director General of Fair Trading, should this step suddenly have been taken? Why would there be any difficulty in allowing the law to take its course and the result to be made public? If necessary, the Government could say at that stage, "Well, we did not really mean the Restrictive Trade Practices Act to apply in this particular way. We did not really mean that. We will bring in a new law which deals with this peculiar circumstance which has been revealed in the exchange of views between the Stock Exchange and the Director General of Fair Trading and in the judgment of the court." That would have been constitutionally proper. As the noble Lord himself said on Second Reading, and as I admitted somewhat wryly at the beginning of our deliberation this afternoon, all Acts of Parliament are "for the time being", and of course one can amend them. A perfectly proper and constitutional course was open to the Government.
The only inference one can draw—and I do not wish to be offensive; the noble Lord knows that I strive for

941
moderation whenever the circumstances permit—is that this rather smacks of a backdoor deal which has been reached by a Conservative Secretary of State for Trade and interests in the Stock Exchange that he knew to be friendly to his own party. That is what it looks like. I do not think that it is right. If my own party were in Government and contemplating such a step I should take exactly the same view. I regard it as completely undesirable and an abuse of the powers of Government to intervene in the proceedings of a case when they apprehend, for whatever reasons may appear logical to them, that a judgment is going against their friends. That is wrong, and I invite all sides of the House to support my amendment.
Lord Taylor of Gryfe: We are in some difficulty on this amendment. It is a manuscript amendment, and is it available to other Members of the Committee? We have been unable to secure a copy of this amendment.
The Chairman of Committees: It is available in the Printed Paper Office and, I imagine, outside.
3.59 p.m.
Lord Cockfield: Perhaps it would be for the convenience of the Committee if I intervened at this stage. This will enable noble Lords who have not done so to read the manuscript amendment tabled by the noble Lord, Lord Bruce of Donington.
May I start by saying that the noble Lord is endeavouring on a side wind to challenge the whole principle of the Bill. He has said nothing whatever about the amendment that he has tabled. All he has done is repeat all the arguments he advanced on Second Reading and which were fully and amply dealt with at that time.
The noble Lord has challenged my action in quoting two cases which related to the law of taxation. Perhaps I may start by reminding him of what he himself said in the opening words of his speech on Second Reading:
"It is…an interference with the process of law…Parliament…has…rarely interfered with the process of law once that process is in operation".—[Official Report, 15/12/83; col. 359.]
The cases that I quoted were specifically designed to answer that point. The cases also dealt with the other argument which is so commonly advanced in this field; namely, that the Act is retrospective or is alleged to be retrospective and that is objectionable. In the fiscal field, retrospective legislation, although rarely indulged in, is not at all unknown. The two cases I quoted were both of retrospective legislation.
In the first instance there was not only the case which had actually been decided, but there had been—as the words I then gave to the House indicated—many other cases which were in course of the process of litigation at the time. The effect of the change in the law was to stop that litigation. The second case that I quoted was half-way between the Court of Appeal and the House of Lords. So far as Parliament intervening in cases of this sort, it is by no means unknown. I entirely agree that it is the kind of action that needs to be considered very carefully indeed, which is exactly what we have done.
There are other examples of retrospective legislation in this field. I thought that the noble Lord would be
942
interested in them. The first was in the Restrictive Trade Practices Act 1976, which exempted retrospectively certain agreements relating to the granting of credit. There was another one in the Competition Act 1980, which exempted copyright agreements, again retrospectively. To be fair, in the latter case there had been some dispute as to whether the Act did or did not apply; but the Government took the view—and I think very properly indeed—that, rather than allow such a dispute to go to the courts to the great benefit of the lawyers but of nobody else, it was desirable to legislate in order to clarify the position. None of these examples is a direct precedent for the present Bill, which is very much sui generis, but they illustrate the fact that the criticisms and arguments that have been made on the specific grounds of retrospection, and also of interference with the due process of law, simply do not hold water.
The noble Lord, Lord Bruce of Donington, also claimed that the proposal was a constitutional impropriety. I do not know whether he used the popular phrase and described it as a constitutional outrage. But these are merely phrases that are used when one does not like something that the other party is doing. There is nothing unconstitutional about coming to Parliament and to your Lordships' House to propose legislation. There has been much criticism on the opposite ground; namely, that Governments—I am not talking specifically about the present Government—do things without coming to Parliament for authority. In this instance nothing could be more constitutionally correct than the Government coming to Parliament and saying, "This is what we propose doing and we want the assent of both Houses of Parliament". That seems to me to be absolutely and completely correct.
The noble Lord went on to say that there was an alternative course available, that is, to allow the case to be heard, for judgment to be given and then for a decision to be taken on what further action should be pursued. This goes right to the heart of the matter. Of course such a course was open; but on very careful consideration of all the factors the view of the Government was that that was the wrong course to take. I set out at length the reasons in the speech I delivered on Second Reading. We felt that the process of change, which we recognise is very necessary in this field, was actually being obstructed by the case which had gone to the Restrictive Practices Court. That judgment has been confirmed by events. Nothing happened between 1978 or 1979 when this issue first arose and when finally the Stock Exchange agreed in the autumn of last year that it would dismantle some of its more important restrictive practices.
Since that agreement was reached, the pace of change has been very great. The Stock Exchange has accepted that many of the more important restrictive practices which had given rise to legitimate anxiety and concern on the part of the director general and of others should be eliminated on a reasonable time scale. That process is going ahead. This is a matter of judgment. Our judgment is that the course that we have chosen is the better of the two. It is on that basis that I commended the Bill to your Lordships' House on Second Reading, and it is on that basis that I take my stand this afternoon.
4.7 p.m.
Lord Elwyn-Jones: I regret that the noble Lord, Lord Boyd-Carpenter, has left the Chamber, no doubt for excellent reasons. On Second Reading he expressed the view that it is impossible to get away from the fact, as stated by my noble friend Lord Bruce of Donington, that the procedure we are examining involves some interference in the operation of the law in respect of a particular case. The noble Lord went on to say that what puzzled him was why it was thought necessary to take the action at this stage. But that raises another matter. I am bound to say that I find myself in accord with the observations of the noble Lord, Lord Boyd-Carpenter.
I have suffered from the great battle about retrospective legislation. I observe that the noble Lord, Lord Cockfield, may have been present when I was savaged on the Burmah Oil case. That has left a scar on my mind which still remains—more or less under control, I am happy to say. That case related to retrospective legislation after the termination of proceedings, in the House of Lords on that occasion, and I am happy to say that the then Attorney-General had the support of a former Conservative Lord Chancellor. But that is by the way. It is merely a matter of prejudice that I express in my favour.
Here we are not concerned with mere retrospective legislation. We are concerned with the interference of the Executive, in the form of the Secretary of State, in the processes taking place before the courts. The Director General of Fair Trading had referred the matter to the Restrictive Practices Court, and I should like to know how far the matter had gone. It had been around for an awful long time—about five years. The position arises that the Secretary of State apparently orders and requires the Director General of Fair Trading—for whom, incidentally, he has no ministerial responsibility—to stop the proceedings pending in the Restrictive Practices Court in order to fulfil the purposes of this legislation. It seems to me that that is a very clear illustration of interference by the Executive with the judicial or court process.
I cannot deny that there may be exceptional circumstances of public policy which require that to be done, but I must say that I have listened in vain to hear what exceptional considerations of public policy would require the action to be taken in this case. I did not have the advantage of hearing the speech made by the noble Lord the Minister on Second Reading, but I have read it and I failed to detect any considerations of public policy affecting the public at large—not a particular interest of a group or body—requiring the Executive to interfere with what is going on in the courts in the way which has been proposed in this case. At the very lowest it is highly questionable, and in applying the proper responsibility of Parliament to see that that kind of thing is not done I think it is right that your Lordships' Committee should not only examine what is proposed, but should reject it.
Lord Diamond: What the noble and learned Lord has just said is surely absolutely right in the sense that, though it may be proper, we do not think it wise to interfere as an Executive in the process of law when it is in the stage mentioned unless there is an overwhelming reason which makes it essential to do
944
so. The noble Lord the Chancellor of the Duchy has referred to cases of tax law, as has the noble Lord, Lord Bruce of Donington. I do not know what is the present accepted rule with regard to taxation law, but I know exactly what it was in my time. It was that one could legislate retrospectively in favour of the taxpayer but one could not legislate retrospectively against his interests. That is to say, as the Minister has said, it is perfectly proper for Parliament to legislate on anything at any time, but it is extremely unwise and against all precedent to legislate retrospectively in certain circumstances.
Having made that absolutely clear, I wish to go on to say why we on these Benches will be abstaining in the vote which I imagine will shortly take place. The noble Lord the Minister was absolutely right when he said that the amendment goes to the heart of the matter. That is to say, it is just the same as an amendment to reject the essence of a Government Bill on Second Reading. I hope I have made it absolutely clear how unhappy we are with the way the Government have handled this matter and with the essence of the Bill, and how much I agree with all the arguments in that direction which were put forward on Second Reading. However, I must say that we have had the Second Reading and we felt it right to let the Bill go through at that stage because we took the view that the constitutional position of your Lordships' House is not—I repeat, not—to deny a Second Reading to a Government Bill. We on these Benches take the view that to support in the Lobby—and possibly successfully support—the amendment which has been moved would have the effect which I have mentioned, and we shall therefore abstain.
Lord Bruce of Donington: There remains very little for me to say following the intervention of my noble and learned friend Lord Elwyn-Jones. I think it has been proved beyond any doubt that in this particular instance there would be an interference with the due process of law.
I am extremely sorry to learn from the noble Lord, Lord Diamond, that he regards a vote against subsection (2) of Clause 1 of the Bill as involving a constitutional principle affecting the conduct of your Lordships' Committee. In point of fact, I sought independent advice officially on this matter before the debate. As your Lordships will recall, at one time I gave notice that I was going to oppose the Question, Whether Clause 1 shall stand part of the Bill? I was advised that that would be equivalent to a vote against the Bill on Second Reading, and consequently would not be in conformity with the usage of your Lordships' House. However, I was also advised—and I was advised officially—that a vote against subsection (2) of Clause 1 did not fall into the same category and would not involve any breach of the usages of your Lordships' House. Therefore, I hope that on reflection the noble Lord, Lord Diamond, and his noble friends will take some notice of that position.
I have no desire to prolong this debate for the sake of prolonging it. My noble and learned friend Lord Elwyn-Jones has already replied very effectively, and so I simply commend the amendment.
Lord Cockfield: I should like to assure the noble Lord, Lord Bruce of Donington, that I was not in any

945
way suggesting that he was not entitled to put down the amendment that he has tabled. The point I was making was that the arguments that he was advancing were arguments against the whole purpose of the Bill. I wonder whether, in relation to what the noble and learned Lord, Lord Elwyn-Jones, said, I may, with very great respect, suggest to him that he is wrong on a point of law—
Lord Elwyn-Jones: It is perfectly proper for the noble Lord to do that.
Lord Cockfield: This is not intervention by the Executive at all. If there is intervention, it is intervention by Parliament or the legislature.
4.18 p.m.
On Question, Whether the said amendment (No. 3A) shall be agreed to?
Their Lordships divided: Contents, 70; Not-Contents, 123.

DIVISION NO. 2

CONTENTS

Allen of Fallowfield, L.

Irving of Dartford, L.

Ardwick, L.

Jacques, L.

Beswick, L.

Jeger, B.

Birk, B.

Jenkins of Putney, L.

Bishopston, L. [Teller.]

John-Mackie, L.

Blyton, L.

Lawrence, L.

Boston of Faversham, L.

Leatherland, L.

Bowden, L.

Llewelyn-Davies of Hastoe, B.

Briginshaw, L.

Lockwood, B.

Brockway, L.

Mishcon, L.

Brooks of Tremorfa, L.

Molloy, L.

Bruce of Donington, L.

Monson, L.

Caradon, L.

Nicol, B.

Carmichael of Kelvingrove, L.

Oram, L.

Cledwyn of Penrhos, L.

Peart, L.

Collison, L.

Phillips, B.

Cooper of Stockton Heath, L.

Pitt of Hampstead, L.

David, B.

Ponsonby of Shulbrede, L. [Teller.]

Davies of Penrhys, L.

Dean of Beswick, L.

Prys-Davies, L.

Denington, B.

Sefton of Garston, L.

Donnet of Balgay, L.

Serota, B.

Elwyn-Jones, L.

Stallard, L.

Elystan-Morgan, L.

Stewart of Alvechurch, B.

Ennals, L.

Stewart of Fulham, L.

Ewart-Biggs, B.

Stoddart of Swindon, L.

Fisher of Rednal, B.

Stone, L.

Fitt, L.

Strabolgi, L.

Gaitskell, B.

Taylor of Blackburn, L.

Gallacher, L.

Taylor of Mansfield, L.

Glenamara, L.

Underhill, L.

Graham of Edmonton, L.

Wallace of Coslany, L.

Hale, L.

Wedderburn of Charlton, L.

Hatch of Lusby, L.

Wells-Pestell, L.

Howie of Troon, L.

Wilson of Rievaulx, L.

Hughes, L.

NOT-CONTENTS

Adeane, L.

Brabazon of Tara, L.

Airey of Abingdon, B.

Broxbourne, L.

Alexander of Tunis, E.

Caithness, E.

Allerton, L.

Campbell of Alloway, L.

Ampthill, L.

Cathcart, E.

Atholl, D.

Chelmer, L.

Bauer, L.

Cockfield, L.

Belhaven and Stenton, L.

Constantine of Stanmore, L.

Bessborough, E.

Cottesloe, L.

Blake, L.

Craigavon, V.

946

Crawford and Balcarres, E.

Middleton, L.

Cullen of Ashbourne, L.

Milverton, L.

Darnley, E.

Molson, L.

Daventry, V.

Monckton of Brenchley, V.

Davidson, V.

Monk Bretton, L.

De L'Isle, V.

Montgomery of Alamein, V.

Denham, L. [Teller.]

Morris, L.

Drumalbyn, L.

Mottistone, L.

Ebbisham, L.

Northchurch, B.

Eccles, V.

Nugent of Guildford, L.

Ellenborough, L.

O'Brien of Lothbury, L.

Elton, L.

Onslow, E.

Enniskillen, E.

Orkney, E.

Fortescue, E.

Orr-Ewing, L.

Fraser of Kilmorack, L.

Pender, L.

Gainford, L.

Penrhyn, L.

Gardner of Parkes, B.

Peyton of Yeovil, L.

Gibson-Watt, L.

Porritt, L.

Gisborough, L.

Portland, D.

Glanusk, L.

Reilly, L.

Grantchester, L.

Richardson, L.

Gray of Contin, L.

Rochdale, V.

Greenway, L.

St. Aldwyn, E.

Gridley. L.

St. Davids, V.

Grimston of Westbury, L.

Saint Oswald, L.

Harvington, L.

Saltoun, Ly.

Hawke, L.

Sandys, L.

Hayter, L.

Savile, L.

Hornsby-Smith, B.

Selkirk, E.

Hylton-Foster, B.

Sharples, B.

Ilchester, E.

Sherfield, L.

Ingrow, L.

Skelmersdale, L.

Killearn, L.

Slim, V.

Kilmany, L.

Somers, L.

Kinloss, Ly.

Stamp, L.

Kintore, E.

Stodart of Leaston, L.

Kitchener, E.

Sudeley, L.

Lane-Fox, B.

Suffield, L.

Lauderdale, E.

Swinton, E. [Teller.]

Long, V.

Terrington, L.

Loudoun, C.

Thomas of Swynnerton, L.

Lucas of Chilworth, L.

Thorneycroft, L.

Luke, L.

Trefgarne, L.

Lyell, L.

Trenchard, V.

McFadzean, L.

Trumpington, B.

Mackay of Clashfern, L.

Vaux of Harrowden, L.

Macleod of Borve, B.

Vickers, B.

Mar, C.

Vivian, L.

Margadale, L.

Waldegrave, E.

Marley, L.

Whitelaw, V.

Merrivale, L.

Wise, L.

Mersey, V.

Resolved in the negative, and amendment disagreed to accordingly.
4.26 p.m.
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 4:
Page 1, line 19, after ("above") insert ("and shall at the same time publish any such particulars, together with any documents relating to such particulars, which he has filed with the Restrictive Practices Court").
The noble Lord said: We on this side do not accept, as a matter of law, that there has been no intervention by the Government in the process of law. In point of fact, directions were explicitly given by the Government prior to this Bill to the Director General of Fair Trading to discontinue the action. All that this Bill does is to seek to legalise what has already been directed by the Government. It is therefore important, as a matter of public interest, that the documents in this case are made public. There is no reason at all why they should not be made public. If the Government are inspired by the nobility of purpose that they put forward, they should regard the production of the

947
documents, the publishing of the documents and the public availability of the documents as vindicating their own fidelity to the rule of law.
What conceivable objection can there be to that? This is a case where, after approximately four years of governmental support, as I have previously stated, for the action taken by the Director General of Fair Trading and following at least three parliamentary public declarations by Governments declining to give any kind of support to the withdrawal of the action, the action has been withdrawn in midstream. Whatever the noble Lord the Minister may say—he always argues his case not only amiably but with some thoroughness—he would surely wish to have his arguments completely vindicated by the documents that are relevant to this case. After all, democracy has been defined as government by discussion—preferably by informed discussion.
Despite the fact that the noble Lord has sought to allay the anxieties of his colleagues—and, with respect, has enunciated one or two extraordinary propositions in law about this matter—the principles behind the action that the Government have taken are not going to lie down. There are going to be further inquiries about this matter because the explanations that the Government have given simply will not wash, and they are still causing anxiety which is not purely confined to this side of the Committee—and I am grateful to the noble Lord, Lord Diamond, for indicating in so far as it affects those for whom he speaks—but which is also widely shared elsewhere.
Why should these documents remain a state secret? There are not any security problems involved in their production. Had the case gone to court, the documents would have been put in as exhibits. Evidence would have been given in support of the documentation already submitted to the court and there would have been a public judgment. The arguments could all have been set out as they are normally set out; and of course as the noble Lord well knows, in extreme cases court transcripts are available, on payment of what some may regard as rather a heavy fee, at the conclusion of any case. So had the case taken its normal course, had there been no intervention by the Executive in the proceedings involved in this case, everybody would have known what it was all about.
The Government will have their Bill; they will have all the actions that they want. Why should they conceivably resist this amendment? The noble Lord may dismiss the arguments raised here; he may cast doubt upon them; and he may argue with his customary ingenuity that a different set of principles, of which we have not yet heard, probably apply to this particular case which fully exculpate the Government and vindicate his case. He may do all that, but I still maintain that, in order that Parliament may check and the people may judge whether the Government have really acted with propriety in this case, both in their intervention and in their submission of the Bill to the House, these documents ought to be published. This amendment seeks to do that. Nobody who has behaved properly, sincerely and honourably has anything to fear from the documents becoming available. I therefore urge your Lordships to support
948
the amendment which I sincerely hope that the noble Lord, in vindication of his own arguments, will be only too happy to accept on behalf of Her Majesty's Government.
Lord Cockfield: I wonder whether I might deal first with certain allegations made by the noble Lord, Lord Bruce of Donington. He claimed that directions were given by the Secretary of State to the director general to discontinue the action. No such directions were given and nor could they have been given. The position was that the litigation was between the director general and the Stock Exchange, and the application to the court was made by the Stock Exchange, not by the Secretary of State at all.
Having disposed of that matter I now turn to the amendment. The documents currently on the Register of Restrictive Agreements, which will be removed by virtue of Clause 1(2), are already in the public domain because the register is open to public inspection. No purpose therefore would be served by an obligation to publish them. They are already there and they are available.
As regards the documents filed by the director general with the court, these so far consist merely of his answer to the Stock Exchange's statement of case and his further rejoinder. Proofs of evidence have not yet been exchanged. The documents filed by the director general would be meaningless without being read along with the Stock Exchange's own statement of case and its reply to the director general's answer. These were supplied by the Stock Exchange on the basis that they would be used only for a very limited purpose—that is, for the court proceedings. Indeed, Section 41 of the Restrictive Trade Practices Act 1976 provides criminal sanctions against disclosure of documents of this kind.
Quite apart from this, the director general's documents would not be particularly illuminating; they are technical, legal documents which do not show how the director general's case would have been presented. On all those grounds therefore I must advise your Lordships to reject the amendment.
Lord Bruce of Donington: I am obliged to the noble Lord for his reply. I concede immediately that of course certain documents are already available; but some are not available. There seems no valid reason why the documents and the case filed by the Director General of Fair Trading should not be made public. The noble Lord may think that they will yield but little information.
As regards the documents that have been put forward by the Stock Exchange on the basis of their being confidential, on the basis of their being only used in the case, I point out that if they had been used as exhibits in the case (had the case come to the Restrictive Practices Court and had judgment been given) these documents would have been made public. There does not seem to be any reason therefore why they should not be made public now. Indeed, the noble Lord referred to the criminality of disclosing documents that ought not to be disclosed. If this clause were passed it would cease to be criminal to have them made public because in conformity with the procedure advocated by the noble Lord, if this Parliament passes

949
laws then they become the law although it might be necessary, I willingly concede, to have a separate schedule on the back indicating which particular part of the law had been amended and in what respect.
I do not like—and I do not think that all Members of your Lordships' Committee like—the manner in which all this is evidently going to be hushed up. Nobody will finally know exactly what happened. I do not think that that is good for the country. I do not think that it is good for the reputation of this House. I do not even think that it is good for the reputations of Governments. To the extent to which this amendment does permit the publication of documents not so far published and not so far available to the public, I think that it merits your Lordships' support. I beg to move.
4.39 p.m.
On Question, Whether the said amendment (No. 4) shall be agreed to?
Their Lordships divided: Contents, 95; Not-Contents, 118.

DIVISION NO. 3

CONTENTS

Allen of Fallowfield, L.

Irving of Dartford, L.

Amherst, E.

Jacques, L.

Ardwick, L.

Jeger, B.

Attlee, E.

Jenkins of Putney, L.

Aylestone, L.

John-Mackie, L.

Banks, L.

Kilmarnock, L.

Beaumont of Whitley, L.

Leatherland, L.

Beswick, L.

Listowel, E.

Birk, B.

Llewelyn-Davies of Hastoe, B.

Bishopston, L.

Lloyd of Kilgerran, L.

Blyton, L.

Lockwood, B.

Boston of Faversham, L.

Mais, L.

Bowden, L.

Mayhew, L.

Briginshaw, L.

Mishcon, L.

Brockway, L.

Molloy, L.

Brooks of Tremorfa, L.

Monson, L.

Bruce of Donington, L.

Nicol, B.

Caradon, L.

Oram, L.

Carmichael of Kelvingrove, L.

Paget of Northampton, L.

Cledwyn of Penrhos, L.

Peart, L.

Collison, L.

Phillips, B.

Cooper of Stockton Heath, L.

Pitt of Hampstead, L.

Cudlipp, L.

Ponsonby of Shulbrede, L. [Teller.]

David, B. [Teller.]

Davies of Penrhys, L.

Prys-Davies, L.

Dean of Beswick, L.

Raglan, L.

Denington, B.

Roberthall, L.

Diamond, L.

Rochester, L.

Donaldson of Kingsbridge, L.

Sainsbury, L.

Donnet of Balgay, L.

Shackleton, L.

Elwyn-Jones, L.

Shepherd, L.

Elystan-Morgan, L.

Simon, V.

Ennals, L.

Stallard, L.

Ewart-Biggs, B.

Stewart of Alvechurch, B.

Fisher of Rednal, B.

Stewart of Fulham, L.

Fitt, L.

Stoddart of Swindon, L.

Gaitskell, B.

Stone, L.

Gallacher, L.

Strabolgi, L.

Gladwyn, L.

Taylor of Blackburn, L.

Glenamara, L.

Taylor of Gryfe, L.

Graham of Edmonton, L.

Taylor of Mansfield, L.

Grimond, L.

Tordoff, L.

Hale, L.

Underhill, L.

Hanworth, V.

Wallace of Coslany, L.

Harris of Greenwich, L.

Walston, L.

Hatch of Lusby, L.

Wedderburn of Charlton, L.

Howie of Troon, L.

Wells-Pestell, L.

Hughes, L.

Wigoder, L.

950

NOT-CONTENTS

Airey of Abingdon, B.

Lyell, L.

Alexander of Tunis, E.

McFadzean, L.

Allerton, L.

Mackay of Clashfern, L.

Ampthill, L.

Macleod of Borve, B.

Atholl, D.

Malmesbury, E.

Auckland, L.

Mancroft, L.

Bauer, L.

Mar, C.

Belhaven and Stenton, L.

Margadale, L.

Bessborough, E.

Marley, L.

Blake, L.

Marshall of Leeds, L.

Brabazon of Tara, L.

Merrivale, L.

Caithness, E.

Mersey, V.

Campbell of Alloway, L.

Middleton, L.

Cathcart, E.

Milverton, L.

Chelmer, L.

Molson, L.

Cockfield, L.

Monckton of Brenchley, V.

Constantine of Stanmore, L.

Monk Bretton, L.

Cottesloe, L.

Montgomery of Alamein, V.

Craigavon, V.

Morris, L.

Cullen of Ashbourne, L.

Mottistone, L.

Darnley, E.

Northchurch, B.

Daventry, V.

Nugent of Guildford, L.

Davidson, V.

O'Brien of Lothbury, L.

Denham, L. [Teller.]

Onslow, E.

Ebbisham, L.

Orkney, E.

Eccles, V.

Pender, L.

Ellenborough, L.

Penrhyn, L.

Elton, L.

Peyton of Yeovil, L.

Enniskillen, E.

Porritt, L.

Fisher, L.

Portland, D.

Fortescue, E.

Reilly, L.

Fraser of Kilmorack, L.

Richardson, L.

Gainford, L.

Rochdale, V.

Gardner of Parkes, B.

St. Aldwyn, E.

Gibson-Watt, L.

St. Davids, V.

Glanusk, L.

Saint Oswald, L.

Grantchester, L.

Sandys, L.

Gray of Contin, L.

Savile, L.

Greenway, L.

Selkirk, E.

Gridley, L.

Sharples, B.

Grimston of Westbury, L.

Skelmersdale, L.

Harvington, L.

Soames, L.

Hawke, L.

Stodart of Leaston, L.

Hayter, L.

Sudeley, L.

Hornsby-Smith, B.

Suffield, L.

Hylton-Foster, B.

Swinton, E. [Teller.]

Ilchester, E.

Terrington, L.

Inglewood, L.

Thomas of Swynnerton, L.

Ingrow, L.

Thorneycroft, L.

Killearn, L.

Trefgarne, L.

Kilmany, L.

Trenchard, V.

Kintore, E.

Trumpington, B.

Kitchener, E.

Vaux of Harrowden, L.

Lane-Fox, B.

Vickers, B.

Lauderdale, E.

Vivian, L.

Long, V.

Waldegrave, E.

Loudoun, C.

Whitelaw, V.

Lucas of Chilworth, L.

Wise, L.

Luke, L.

Resolved in the negative, and amendment disagreed to accordingly.
4.47 p.m.
Lord Taylor of Gryfe Lord Taylor of Gryfe had given notice of his intention to move Amendment No. 5:
Page 1, line 21, at end insert ("But notwithstanding the above, the Secretary of State shall instruct the Monopolies and Mergers Commission to conduct an enquiry into the practices of The Stock Exchange and to report no later than 31st December 1984.").
Lord Diamond: I hope it will be acceptable to your Lordships' Committee that I move the amendment standing in the name of my noble friend Lord Taylor of Gryfe. He is most anxious to move this amendment and believes that it is important and deserving of the

951
consideration of your Lordships. The slight difficulty under which I labour is that I feel sure that I cannot move it with anything like the distinction of my noble friend—to whom I now give way.
Lord Taylor of Gryfe: I apologise to the Committee for being delayed in the corridors. Your Lordships will be glad to hear that, while I propose to rehearse a little of the background of this Bill, I do not propose to make a Second Reading speech on this occasion. Your Lordships will recall that this Bill arises from the deliberations of the Office of Fair Trading, which over a period of six years examined the rule book of the Stock Exchange and concluded that there were 173 cases of infringement of the law as it then stood.
I agree with the noble Lord, Lord Cockfield, that to have referred this matter to the courts would have meant a long process examining each of these infringements. It would have delayed necessary changes in Stock Exchange practices, and the adversarial atmosphere of the court is perhaps not the appropriate atmosphere to secure changes which depend on general agreement. Therefore, in exchange for the withdrawal from the court the Stock Exchange made certain promises to change, and, as the noble Lord, Lord Cockfield, has indicated, the changes are already taking place rapidly.
The spin-off from some of the provisions that are now made can be read daily in the Financial Times; the mergers, the changes in associations and the alliances between financial organisations. These changes are matters of great public interest. The public has a substantial interest in what is taking place. While we have arranged that there will be a monitoring of these changes provided in what the Government have said, I believe it would be no impediment to these changes if the Monopolies and Mergers Commission were to have the opportunity in the next year—as is provided in the amendment—to examine the process of change and what is happening in the market as a result of the changes that have been agreed.
The noble Lord, Lord Cockfield, has said that we can monitor these changes and discuss them by Parliamentary Question; but I am sure he will readily agree that this is not an adequate way of monitoring substantial changes of great importance. Since there is a very large public interest in what is taking place affecting important financial institutions, I suggest that it might be worthwhile for the watchdog commission, the Monopolies and Mergers Commission, to consider this in connection with industry. References are made regularly to the Monopolies and Mergers Commission where there is some degree of doubt in the public interest. I suggest that what is taking place in the financial sector arising from the Bill might be similarly examined by the commission. I beg to move accordingly.
Lord Cockfield: It may help if I referred briefly to the law on this subject. The restrictive trade practices legislation and the monopolies and mergers legislation are two parallel but rather different régimes. The position is that if an agreement comes under the terms of the Restrictive Trade Practices Act it is thereby
952
excluded from the operation of the monopolies and mergers legislation. This arises as a result of Section 10(1) and (2) of the Fair Trading Act 1973 as subsequently amended and extended. The result therefore of excluding the Stock Exchange agreements from the Restrictive Trade Practices Act is to bring certain of them within the ambit of the Monopolies and Mergers Commission. This is true in the case of stockbroking services. It is not true in the case of stock jobbing because in law stock jobbing is not a service.
While it is true therefore that as a matter of law, once the present Bill is enacted stockbroking will come within the ambit of the monopolies and mergers legislation, it does not follow that a reference ought to be made to the Monopolies and Mergers Commission. That is a matter which can only be decided in the light of the circumstances which exist at the time. Certainly our view is that at present it would be entirely wrong for such a reference to be made. In effect what the noble Lord's proposed amendment would do would be to substitute an investigation by the Monopolies and Mergers Commission for investigation under the restrictive practices legislation. It would simply be to substitute one form of investigation for another.
As I said at Second Reading, the primary reason why we feel that the Stock Exchange should be exempted from the Restrictive Trade Practices Act is that the operation of that Act is preventing and holding up the very desirable process of change. Under the terms of the Bill now the Stock Exchange will be exempted from the Restrictive Trade Practices Act. Change is going ahead rapidly. If there were to be a reference to the Monopolies and Mergers Commission that would bring back again the undesirable situation that we had in the past under which the Stock Exchange was quite unwilling to make any change in its rules or in its practices. The really important point is that we should now give the Stock Exchange every encouragement to go ahead and to remove these restrictive practices, as it has undertaken to do. I must therefore advise your Lordships to reject the amendment.
Lord Bruce of Donington: We on this side of the Committee wish to support the amendment put down by the noble Lord, Lord Taylor of Gryfe. The noble Lord's answer will not do. All he is really saying is that because the Stock Exchange has found it to its own advantage not to take any action so far to bring itself into conformity with the requirements of the Restrictive Trade Practices Act, it is to be allowed to get away with it. All one has to do is to do nothing to gain the support of the Government who say that the very act of bringing matters before the Restrictive Practices Court has held up progress. But I ask the Committee to whose advantage? The Stock Exchange would much have preferred not to have come under the restrictive practices legislation at all. It would much have preferred to have gone its own way as it has up to now, and done handsomely out of it, too.
Last year was a bumper year. Of course the Stock Exchange will do nothing and has done nothing until such time has arrived—which must have been hoped for for a long time—that ultimately there would be a Secretary of State for Trade who would give way. That has been achieved and the noble Lord, Lord Taylor of

953
Gryfe, is quite right in his advocacy that the matter now be referred to the Monopolies and Mergers Commission which, as the noble Lord has willingly conceded, following the passing of this Bill it will be proper and appropriate for it to do, if it is instructed to do so.
Why should it not be instructed to do so? On the basis of the lowest common denominator of argument in this case what has happened in the past four years and the machinations in the minds both of the council of the Stock Exchange and of successive Secretaries of State has so far been hidden from us. Why should these things not be made more public? Why should they not be investigated? What is so sacred about this august institution comprising brokers and jobbers that has for ever to be kept under wraps? Every association could argue the same. Let us say that the Director General of Fair Trading fired a warning shot over the bows of some association somewhere, and said that he thought that that association was infringing the Restrictive Trade Practices Act. The association has a choice of saying that it agrees, and that its members will be good boys and will make some changes. But if they feel that they have a pliant Government behind them, a friendly Government, they will sit back and do nothing in the full knowledge that the Government will then say that the association's inaction has forced its exemption from the provisions of the Act. That is a somewhat bizarre position. I think, with the noble Lord, Lord Taylor of Gryfe, that it is high time some independent body took a look at that. It can do no possible harm.
I suppose that next we shall hear that that will prohibit any agreement because the Stock Exchange is afraid of the Monopolies Commission. I suppose that the next step of the noble Lord will be to move the abolition of the Monopolies Commission on the ground that the Stock Exchange is doing nothing because an inquiry is going on. This is quite likely in view of the Government's existing attitude, which in my view—and I am quite sure that the noble Lord with his logical processes of mind must agree—is quite untenable. Nobody can logically support this. I sincerely hope that he will accept the amendment. If he does not do so then, on behalf of my own party, we shall certainly sustain the noble Lord, Lord Taylor of Gryfe, in his amendment.
5.1 p.m.
Lord Cockfield: The noble Lord, Lord Bruce, has made a large number of statements which are quite insupportable. He says that the Stock Exchange have been allowed to get away with it; that the Stock Exchange have done nothing and that inaction justifies their exemption from the Act. The truth of the matter is exactly the reverse of this. What has happened is that the Stock Exchange, far from getting away with it, have agreed to dismantle the most important of their restrictive practices and substantial progress has already been made.
As the noble Lord, Lord Taylor of Gryfe, referred to the figures that I gave in replying to the debate on Second Reading, perhaps I may repeat them now. There were, in all, 165 restrictions identified by the director general. Of those, he was to challenge 59 as
954
not being in the public interest; although of course the Stock Exchange did not accept that. He was not prepared to challenge the remainder of the restrictions. In other words, out of 165 restrictions, the director general was not prepared to challenge 106. Of the 59 restrictions which were challenged, 52 relate to single capacity, minimum commissions or membership; and those are the three major issues on which the Stock Exchange is now making real progress in dismantling the restrictive practices. That leaves a balance of only seven, six of which concern general regulations and one is an anti tax-avoidance provision to which I think no reasonable objection would be taken—and, if I may add the words, not even by the noble Lord, Lord Bruce of Donington. So that the suggestion that the Stock Exchange has been frozen in its tracks is completely untrue.
The point that I was making and which I will repeat, because this may be the point on which the noble Lord wishes to intervene, is that what is happening is that we have the process of change now going ahead. We want that process of change to make as rapid progress as is possible. We do not want it to be interrupted by another inquiry at this stage. The only other point I make is this. The noble Lord speaks as though exempting the Stock Exchange from the Restrictive Trade Practices Act is something quite exceptional, as if nobody else was exempt from it.
May I read from Schedule 4 of the Fair Trading Act 1973 which lists no fewer than 15 categories of people exempt from the Restrictive Trade Practices Act. The list starts with legal services; and I see the noble and learned Lord, Lord Ellyn-Jones, on the Front Bench opposite. It then goes on to medical services, dental services, ophthalmic services, and so on, right down until we get to architects and accountants—the subject which no doubt interests the noble Lord, Lord Bruce of Donington. And so it goes on and on. There were further exemptions introduced in the order in 1976 and further exemptions in subsequent statutes. There is therefore nothing exceptional on exempting a body or a service from the Restrictive Trade Practices Act. In fact, many others are exempt. The important point is that the exemption should be decided by Parliament, which is exactly what we are doing on the present occasion.
Lord Bruce of Donington: Will the noble Lord answer me one question? If this Bill becomes an Act, the Stock Exchange will be removed from all operations of the Restrictive Trade Practices Act. I put forward a possibility without casting any implications on anybody. Let us say that, under the provisions of Clause 1(1) of the Bill, the Stock Exchange, the Treasury, the Secretary of State and the Bank of England (who still remain) do not arrive at agreement. Let us say, without imputing any bad to anybody, that the Stock Exchange stick on a point. The noble Lord has already given 59 instances on which the Office of Fair Trading intend to proceed in conformity, presumably, with the Restrictive Trade Practices Act. Let us presume for the moment that, for perfectly bona fide reasons—and not for pure cussedness—the Stock Exchange declines to arrive at agreement. It has every right to do so. It can plead—and indeed we have had some overtones to that in the most important speeches

955
made by the noble Lord, Lord O'Brien, and others—the exceptional circumstances which sometimes arise in connection with their financial and investment affairs.
What happens if, due to some special circumstances not envisaged by any party—and I impute no ill-faith—the Stock Exchange says that, in the intervening period of 18 months which elapsed since the passing of the Bill exempting them from the operations of the Restrictive Trade Practices Act, there have been other developments of vital importance to the country's economy, of vital importance to the Treasury, making it imperative that they retain some rights that they had thought perhaps they would be able to give up? Let us assume that.
What then will the Government do? Will they try to invoke the Restrictive Trade Practices Act again? What kind of pressure can they bring to bear? This, I am quite sure, is what the noble Lord, Lord Taylor, conceivably had in mind. I do not seek to probe into it. But, clearly, as a possible safeguard against such a development, it would be wise for the Monopolies Commission to take a look at the whole thing, to investigate and report. I think the noble Lord should be supported.
Lord Cockfield: The point raised by the noble Lord, Lord Bruce of Donington, is a perfectly different one from the one covered by the amendment in the name of Lord Taylor of Gryfe. Lord Taylor's amendment provides for an immediate investigation by the Monopolies Commission and a report no later than 31st December 1984. The circumstances that Lord Bruce is talking about are totally different. We believe that the Stock Exchange will proceed along the lines of the agreement that has been reached. It has been reached in good faith. We believe that it will be fully honoured. We have set up a monitoring process to ensure that we know whether or not it is honoured.
If circumstances should arise at some day in the future when it emerges that serious disagreement arose between the Stock Exchange, the Secretary of State and the Bank of England—and we must hope very much that no such circumstances arise, for we are going ahead at the moment very effectively and making good progress, and I trust that that is welcome on both sides of the Committee—then the Government will have to decide what action to take in relation to those circumstances. At the very beginning I made it perfectly clear that the service of stockbroking, once this Bill is passed, will come under the ambit of the monopolies and mergers legislation. There is no question about that. But what action should be taken is clearly a matter which can be decided by the Government only if and when those circumstances arise, and we hope and trust they never will arise.
Lord Taylor of Gryfe: I should like to emphasise that we on these Benches, in introducing this amendment, are anxious not to impede in any way the process of change in the Stock Exchange. The provisions which the noble Lord outlined on Second Reading are welcome so far as we are concerned; and I realise that some of them have immediate implications, as can be observed daily from the financial press.
956
There are other aspects of the agreement which will take some time to implement; for example, the single capacity may take a little time to come into effect. I would not have thought that the reference to the Monopolies and Mergers Commission would in any way restrict this process of change. It is not like a mergers reference, in which you immediately have a freeze on negotiations regarding takeover procedures. This would be alongside what is in fact a voluntary agreement.
The Stock Exchange has already voluntarily agreed, in exchange for this Bill, to certain changes of procedure. There is no reason in the world why these changes should not proceed as promised. A reference to the Monopolies and Mergers Commission would not necessarily prevent that, or delay necessary changes. I think it would be a poor excuse if in fact that were to be so. It is not our intention to turn the clock back. The Office of Fair Trading looked at this over a period of six years, and we are not anxious to re-open the entire case in that way. But we do say that there is a substantial measure of public interest in this matter, and its full implications should be looked at by the Monopolies and Mergers Commission alongside the rather restricted area of the monitoring process which will go on.
It is because of the degree of public interest in it that we would wish the Monopolies and Mergers Commission, at least for one year, alongside the changes which are taking place, to have a look at this matter; and it is for that reason, if not for all the other reasons adduced by the noble Lord, Lord Bruce of Donington, in support of his amendment, that we would certainly wish to press this amendment.
5.14 p.m.
On Question, Whether the said Amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 97; Not-Contents, 128.

DIVISION NO. 4

CONTENTS

Airedale, L.

Elystan-Morgan, L.

Allen of Fallowfield, L.

Ennals, L.

Amherst, E.

Ewart-Biggs, B.

Ardwick, L.

Ezra, L.

Banks, L.

Fisher of Rednal, B.

Beswick, L.

Fitt, L.

Birk, B.

Gaitskell, B.

Bishopston, L.

Gallacher, L.

Blyton, L.

Gladwyn, L.

Bowden, L.

Glenamara, L.

Briginshaw, L.

Graham of Edmonton, L.

Brockway, L.

Grimond, L.

Brooks of Tremorfa, L.

Hale, L.

Bruce of Donington, L.

Hanworth, V.

Carmichael of Kelvingrove, L.

Harris of Greenwich, L.

Cledwyn of Penrhos, L.

Hatch of Lusby, L.

Collison, L.

Howie of Troon, L.

Cooper of Stockton Heath, L.

Hughes, L.

David, B.

Irving of Dartford, L.

Davies of Penrhys, L.

Jacques, L.

Dean of Beswick, L.

Jeger, B.

Denington, B.

Jenkins of Putney, L.

Diamond, L.

John-Mackie, L.

Donaldson of Kingsbridge, L.

Kagan, L.

Donnet of Balgay, L.

Kennet, L.

Elwyn-Jones, L.

Kilmarnock, L. [Teller.]

957

Leatherland, L.

Sainsbury, L.

Listowel, E.

Seear, B.

Llewelyn-Davies of Hastoe, B.

Segal, L.

Lloyd of Kilgerran, L.

Shackleton, L.

Lockwood, B.

Simon, V.

Longford, E.

Stallard, L.

McIntosh of Haringey, L.

Stedman, B.

Mackie of Benshie, L.

Stewart of Alvechurch, B.

Mais, L.

Stewart of Fulham, L.

Mar, C.

Stoddart of Swindon, L.

Mayhew, L.

Stone, L.

Monson, L.

Strabolgi, L.

Nicol, B.

Taylor of Gryfe, L.

Oram, L.

Taylor of Mansfield, L.

Paget of Northampton, L.

Tordoff, L. [Teller.]

Peart, L.

Underhill, L.

Phillips, B.

Wallace of Coslany, L.

Pitt of Hampstead, L.

Wells-Pestell, L.

Ponsonby of Shulbrede, L.

Whaddon, L.

Prys-Davies, L.

White, B.

Roberthall, L.

Wigoder, L.

Rochester, L.

Winstanley, L.

Rugby, L.

NOT-CONTENTS

Abercorn, D.

Killearn, L.

Airey of Abingdon, B.

Kilmany, L.

Alexander of Tunis, E.

Kintore, E.

Allerton, L.

Kitchener, E.

Ampthill, L.

Lane-Fox, B.

Atholl, D.

Lauderdale, E.

Bauer, L.

Long, V.

Belhaven and Stenton, L.

Loudoun, C.

Blake, L.

Lucas of Chilworth, L.

Brabazon of Tara, L.

Luke, L.

Broadbridge, L.

Lyell, L.

Broxbourne, L.

McFadzean, L.

Bruce-Gardyne, L.

Mackay of Clashfern, L.

Caithness, E.

MacLehose of Beoch, L.

Cathcart, E.

Macleod of Borve, B.

Chelmer, L.

Malmesbury, E.

Cockfield, L.

Mancroft, L.

Coleraine, L.

Margadale, L.

Constantine of Stanmore, L.

Marley, L.

Cottesloe, L.

Marshall of Leeds, L.

Craigavon, V.

Massereene and Ferrard, V.

Cranbrook, E.

Merrivale, L.

Cullen of Ashbourne, L.

Mersey, V.

Darnley, E.

Middleton, L.

Daventry, V.

Milverton, L.

Davidson, V.

Molson, L.

De La Warr, E.

Monckton of Brenchley, V.

Denham, L. [Teller.]

Monk Bretton, L.

Dilhorne, V.

Montagu of Beaulieu, L.

Drumalbyn, L.

Montgomery of Alamein, V.

Ebbisham, L.

Morris, L.

Eccles, V.

Mottistone, L.

Elton, L.

Newall, L.

Enniskillen, E.

Northchurch, B.

Faithfull, B.

Nugent of Guildford, L.

Fisher, L.

O'Brien of Lothbury, L.

Fortescue, E.

Orkney, E.

Fraser of Kilmorack, L.

Pender, L.

Gainford, L.

Penrhyn, L.

Gibson-Watt, L.

Perth, E.

Gisborough, L.

Peyton of Yeovil, L.

Glanusk, L.

Portland, D.

Granchester, L.

Richardson, L.

Gray of Contin, L.

Robertson of Oakridge, L.

Greenway, L.

Rochdale, V.

Gridley, L.

St. Aldwyn, E.

Grimston of Westbury, L.

St. Davids, V.

Harvington, L.

Sandys, L.

Hawke, L.

Savile, L.

Hayter, L.

Selkirk, E.

Henley, L.

Sharples, B.

Hertford, M.

Skelmersdale, L.

Hornsby-Smith, B.

Soames, L.

Hylton-Foster, B.

Somers, L.

Ingrow, L.

Stodart of Leaston, L.

Ironside, L.

Sudeley, L.

958

Suffield, L.

Tryon, L.

Swinton, E. [Teller.]

Vaux of Harrowden, L.

Terrington, L.

Vickers, B.

Thomas of Swynnerton, L.

Vivian, L.

Thorneycroft, L.

Waldegrave, E.

Trefgarne, L.

Westbury, L.

Trenchard, V.

Whitelaw, V.

Trumpington, B.

Wise, L.

Resolved in the negative, and amendment disagreed to accordingly.
5.23 p.m.
On Question, Whether Clause 1 shall stand part of the Bill?
Lord Bruce of Donington: I promise not to detain your Lordships for long in regurgitating any of the arguments which have been used so far, but I think it is wise that the House should realise exactly what are the real implications of passing Clause 1 of this Bill. It affects not only Section 11 of the Restrictive Trade Practices Act but other sections as well. Section 12 of the Restrictive Trade Practices Act enables the Secretary of State statutorily to obtain a whole series of information which ought to be vital to the supervision of the affairs of any institution such as the Stock Exchange. Section 12 of that Act gives him that right and that right is now being taken away. There is no statutory obligation to comply with the sections of that Act or with the Fair Trading Act 1973 which laid down certain conditions. In fact, he is denied the issue of a statutory order which enables him to obtain very vital information, about which there was considerable debate at the time of the passing of the original Act, which was a long time before its consolidation in 1976.
The noble Lord said earlier that it would have been quite easy in the initial stages to have made the Stock Exchange a designated service within the provisions of Section 13 of the Act and, indeed, of a supporting schedule. In the course of the inquiries that I have made since the Bill first came to your Lordships' House—and the Committee will appreciate that individual Members do not have the research facilities that are available as a matter of right, and properly as of right, to Government departments—I have been through the reports of the debates that took place on both the Fair Trading Act 1973 and the Restrictive Trade Practices Act, and I cannot find any representations made by any noble Lord, or by any member of any Government of the time—and these have varied—who has advocated the inclusion of the Stock Exchange among the designated services to which the noble Lord has referred, and who include lawyers like himself, accountants like myself, doctors and so on. Nor, so far as I can find—and I must say that my own researches have had to be limited because of time—can I find any trace of any representations made on behalf of the Stock Exchange to be included among the designated services. I wonder why that did not happen. Nor did it happen at any time during the four years that this has been under review.
Of course, it means that all this has apparently blown up—I put this in parenthesis—since the last election which took place in June. I wonder why it has blown up so late. Section 7 of the Fair Trading

959
Act—and this now no longer applies to the Stock Exchange—refers to two or more persons,
"who whether voluntarily or not, and whether by agreement or not, so conduct their respective affairs as in any way to prevent, restrict or distort competition in connection with the supply of services of that description, whether or not they themselves are affected by the competition, and whether the competition is between persons interested as persons by whom, or as persons for whom, services are supplied".
Hereafter, the Stock Exchange and its members are exempted from those provisions. When the time comes, I think it will be regretted, particularly in view of the fact that there has always been plenty of opportunity for representations to be made for those learned professions of stockbrokers and jobbers to be included in the designated services.
It is not for me to anticipate what the result of those representations might have been, but we could have had the arguments a long time ago and, to use the words of the noble Lord, substantial progress could undoubtedly have been made long before now. There are no new circumstances in the operations of members of the Stock Exchange that could not have been dealt with quite adequately a long time ago.
We cannot part with this clause without referring once again to the intervention into the process of law, after it became established. I shall not rehearse the arguments again, but I am bound to tell the noble Lord that there are circumstances in which this action of intervention could be justified. For example, if a Bill were presented to your Lordships which read substantially in the following terms, your Lordships would understand readily what I mean. If there was a Bill which began:
"The Employment Acts of 1980 and 1982 shall not apply—(a) to any agreement between members of a trade union, its members and the activities of its members or (b) to any agreement with respect to any of these matters between (i) the TUC and the Secretary of State for Employment and the Confederation of British Industry; and (ii) any proceedings in respect of any such agreement which are pending before the courts at the passing of this Act shall abate",
one could understand the expressions of opposition by the party opposite concerning the wanton interference with the law. I cite that merely as an example of what might happen, because the precedent has now been set.
Lord Cockfield: The noble Lord is simply rehearsing all the arguments that he put forward on Second Reading. The Bill has only one operative clause, and that is Clause 1. In effect, therefore, Clause 1 is the substance of the Bill itself. The noble Lord said that the Committee should understand the real implications of accepting Clause 1 of the Bill. The real implications are precisely the same as the implications in the case of any other services which are exempted from the restrictive practices legislation. That includes not only the numerous services which are specified in the 1973 Act, some of which I read out because I thought the noble Lord would be interested, but also a schedule to the 1976 order which exempts a whole range of agreements, none of which is particularly professional. They include, for example, international sea transport, air transport, road passenger transport and the building societies interest rate cartel, none of which can be described as professional activities.
960
There are also exemptions in other Acts. Therefore the position is simply that when this Bill is enacted the Stock Exchange will be placed on the same footing as any other body performing services which are exempted either under the 1973 Act or under subsequent legislation.
I really think that it is unnecessary for me to say anything further. We have gone over these arguments time and time again. There are a number of arguments put forward by the noble Lord, Lord Bruce of Donington, which I find quite astounding. He says that at no time was any move made by the Stock Exchange to demand exemption, while he himself at Second Reading reminded us quite correctly that his right honourable friend Mr. John Smith and my right honourable friend Mr. Nott, as he then was, had both refused to accede to requests by the Stock Exchange. If they refused to accede to such requests, it clearly indicates that such requests were made.
Clause 1 agreed to.
5.34 p.m.
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 6:
After Clause 1, insert the following new clause:
("Duration.
This Act shall cease to have effect on the first day of January 1987 unless resolutions to the contrary are approved by both Houses of Parliament during the three months prior to the first day of January 1987.").
The noble Lord said: The purpose of this amendment is in effect to bring the position back under review after three years from now. If the Stock Exchange, the Treasury, the Secretary of State and all the rest arrive at an agreement within the foreseeable future, on the assumption that the time stated in the amendment is reasonable there does not seem to be any reason why the Act should not come into operation again, if only by way of surveillance. If the noble Lord can guarantee that the agreement which is ultimately reached will get rid of all the 59 instances which he cited at Second Reading and that the result of these voluntary negotiations will be to bring the Stock Exchange within the operation of the Restrictive Trade Practices Act as it now stands, he cannot have any possible objection to the Stock Exchange coming within the ambit of the law if the Act becomes operative again in 1987. If, on the other hand, it means that an agreement will be reached which still contains restrictive practices, anti-competitive practices and all the rest which are repugnant to the Restrictive Practices Court and to the Fair Trading Act 1973, I can understand the noble Lord opposing it.
The amendment is being introduced on the assumption that only time is necessary. The Committee is being given to understand that vigorous and most encouraging progress is now being made. We are given the impression that the Council of the Stock Exchange are hell bent on arriving at an amicable agreement with the Government at the earliest opportunity. In this amendment I have allowed until 1987. Surely the noble Lord cannot object to that. I feel quite sure that he would not like members of the Stock Exchange to be submitted to the indignity of feeling that they were special animals who could

961
operate outside the law as they have always understood it in the past. I am sure that the noble Lord would not wish to inflict that indignity upon them.
Everybody has been acting in this matter, we are assured, in good faith. The noble Lord, Lord O'Brien of Lothbury, or perhaps it was the noble Lord opposite, mentioned the Stock Exchange motto, "My word is my bond". I have every reason to believe this to be so. All the matters about which the Director General of Fair Trading has complained will now be dealt with voluntarily. Everybody will be happy. I am giving three years for it, just to act as a little urge on the way in case things get slightly hesitant from time to time. I am trying to help the noble Lord by imposing some kind of deadline. He might feel that it is necessary to turn his deadly invective on members of the Stock Exchange and say, "Look, unless you make a little more progress, remember that you will be liable again under the Act in 1987. Get on with it, boys".
I do not want to put the noble Lord into a position where he has to nag everybody; he is not like that. If this amendment is passed, it will serve notice on all concerned that there is a final date. I am hopeful, therefore, that the noble Lord will accept the amendment and that it will be unnecessary for me to take the matter to a Division. If for some obscure reason he does not feel so inclined, for quite mysterious reasons which he will doubtless explain in his usual very fluent fashion, I shall of course be greatly obliged but will have to advise my colleagues to support the amendment.
Lord Peyton of Yeovil: As this is the first Committee stage in your Lordships' House which I have attended, I wonder whether I could make just two observations at the conclusion of the debates. Both relate to the noble Lord, Lord Bruce of Donington. First, the noble Lord has told us on a number of occasions, obviously with great sincerity, that he has no desire whatsoever to be offensive to anybody, particularly to the Government and their friends. He then slipped, although I am sure he did not intend to do so, into being very offensive indeed. As a newcomer to your Lordships' House, I take notice of that technique; while I shall, of course, resist the temptation to try to copy so great a master of it as the noble Lord, I shall nevertheless note it.
The other point which I am sure my noble friend who is to answer the debate will have picked up for himself is the fearful danger in which any man might find himself when threatened with the desire on the part of the noble Lord, Lord Bruce of Donington, to help. He threatened my noble friend just now with that form of assistance. I am sure that my noble friend needs no warning from me and no support or help from me—but I will just remind him that those who sup with the devil should take a very long spoon with them.
Lord Cockfield: I am most grateful to my noble friend Lord Peyton of Yeovil for his remarks and also for his warning. On this occasion may I say that I am quite unable for my part to help the noble Lord, Lord Bruce of Donington, and I am not able to give him the satisfaction of accepting his new clause. The effect of the clause would be, first, to subject the agreements of
962
the Stock Exchange to a totally different régime from that which applies to all the other agreements which are exempted from the operation of the Restrictive Trade Practices Act. I do not believe there is any justification for that at all.
We have an agreement for the Stock Exchange which I think is a good agreement. We believe that that agreement will be honoured. There is every indication that it is being honoured. It is being carefully monitored. I have already said that, in the very unlikely event of anything going wrong, the Government would then need to consider what was the appropriate step to take. I am quite unable to go any further than that. To introduce a provision of this sort under which, in effect, you are switching the restrictive trade practices legislation and the Restrictive Trade Practices Court on and off is entirely undesirable.
Lord Bruce of Donington: I will not detain the Committee very long except to say that it would not be necessary to have switched the Restrictive Trade Practices Court on again if the noble Lord had not switched it off in the first instance. I beg to move.
5.42 p.m.
On Question, Whether the said amendment (No. 6) shall be agreed to?
Their Lordships divided: Contents, 63; Not-Contents, 125.

DIVISION NO. 5

CONTENTS

Allen of Fallowfield, L.

Leatherland, L.

Beswick, L.

Llewelyn-Davies of Hastoe, B.

Birk, B.

Lockwood, B.

Bishopston, L.

Longford, E.

Blyton, L.

McIntosh of Haringey, L.

Boston of Faversham, L.

Mishcon, L.

Briginshaw, L.

Molloy, L.

Brockway, L.

Monson, L.

Brooks of Tremorfa, L.

Nicol, B. [Teller.]

Bruce of Donington, L.

Oram, L.

Carmichael of Kelvingrove, L.

Peart, L.

Cledwyn of Penrhos, L.

Phillips, B.

Collison, L.

Pitt of Hampstead, L.

David, B.

Ponsonby of Shulbrede, L. [Teller.]

Davies of Penrhys, L.

Dean of Beswick, L.

Prys-Davies, L.

Denington, B.

Rea, L.

Elwyn-Jones, L.

Rugby, L.

Ennals, L.

Shackleton, L.

Ewart-Biggs, B.

Stallard, L.

Fisher of Rednal, B.

Stewart of Alvechurch, B.

Gaitskell, B.

Stewart of Fulham, L.

Gallacher, L.

Stoddart of Swindon, L.

Graham of Edmonton, L.

Stone, L.

Hale, L.

Strabolgi, L.

Hatch of Lusby, L.

Taylor of Blackburn, L.

Hughes, L.

Taylor of Mansfield, L.

Irving of Dartford, L.

Underhill, L.

Jacques, L.

Wallace of Coslany, L.

Jeger, B.

Wedderburn of Charlton, L.

Jenkins of Putney, L.

White, B.

John-Mackie, L.

Wootton of Abinger, B.

NOT-CONTENTS

Abercorn, D.

Atholl, D.

Airey of Abingdon, B.

Bauer, L.

Alexander of Tunis, E.

Belhaven and Stenton, L.

Allerton,L.

Bellwin. L.

963

Blake, L.

Mackay of Clashfern, L.

Brabazon of Tara, L.

MacLehose of Beoch, L.

Brougham and Vaux, L.

Malmesbury, E.

Broxbourne, L.

Mancroft, L.

Bruce-Gardyne, L.

Mar, C.

Caithness, E.

Margadale, L.

Campbell of Alloway. L.

Marley, L.

Cathcart, E.

Marshall of Leeds, L.

Chelmer, L.

Massereene and Ferrard, V.

Cockfield, L.

Maude of Stratford-upon-Avon, L.

Coleraine, L.

Constantine of Stanmore, L.

Merrivale, L.

Cottesloe, L.

Mersey, V.

Craigavon, V.

Milverton, L.

Cranbrook, E.

Molson. L.

Cullen of Ashbourne, L.

Monckton of Brenchley, V.

Darnley, E.

Monk-Bretton, L.

Daventry, V.

Montgomery of Alamein, V

Davidson. V.

Morris, L.

De La Warr, E.

Mottistone, L.

Denham, L. [Teller.]

Napier and Ettrick, L.

Dilhorne, V.

Northchurch, B.

Drumalbyn, L.

Nugent of Guildford, L.

Ebbisham, L.

O'Brien of Lothbury, L.

Eccles, V.

Onslow, E.

Elton, L.

Orkney, E.

Enniskillen, E.

Pender, L.

Faithfull, B.

Penrhyn, L.

Fisher, L.

Perth, E.

Fortescue, E.

Peyton of Yeovil, L.

Fraser of Kilmorack, L.

Portland, D.

Gainford, L.

Richardson, L.

Gibson-Watt, L.

Robertson of Oakridge, L.

Gisborough, L.

Rochdale, V.

Glanusk, L.

St. Aldwyn, E.

Grantchester, L.

St. Davids, V.

Gray of Contin, L.

Sandford, L.

Gridley. L.

Sandys, L.

Grimston of Westbury, L.

Savile, L.

Hayter, L.

Selkirk, E.

Henley. L.

Shannon, E.

Hertford, M.

Sharples, B.

Hornsby-Smith, B.

Stodart of Leaston, L.

Hylton-Foster, B.

Sudeley, L.

Inglewood, L.

Swinton, E. [Teller.]

Ingrow, L.

Terrington, L.

Kilmany, L.

Thomas of Swynnerton, L.

Kinloss, Ly.

Thorneycroft, L.

Kintore, E.

Trefgarne, L.

Kitchener, E.

Trenchard, V.

Lane-Fox, B.

Trumpington, B.

Lauderdale, E.

Tryon, L.

Lawrence, L.

Vaux of Harrowden, L.

Long, V.

Vickers, B.

Loudoun, C.

Vivian, L.

Lucas of Chilworth, L.

Waldegrave, E.

Luke, L.

Westbury, L.

Lyell, L.

Whitelaw, V.

McFadzean, L.

Wise. L.

Resolved in the negative, and amendment disagreed to accordingly.
5.50 p.m.
Clause 2 agreed to.
House resumed: Bill reported without amendment.
Lord Cockfield: My Lords, I beg to move that this Report be now received.
Moved, That the Report be now received.—(Lord Cockfield.)
Lord Hughes: My Lords, if this Motion is agreed to, does it not mean that there will be no Report stage on this Bill?
Lord Denham: Yes, my Lords, that is right.
Lord Hughes: I do not think we should accept that.
The Chairman of Committees: The Question is, That this Report be now received?
On Question, Motion agreed to: Report received.

Inshore Fishing (Scotland) Bill [H.L.]
5.52 p.m.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Gray of Contin.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD JACQUES in the Chair.]
Clause 1 [General power to prohibit sea fishing in specified areas] and Clause 2 [Use of mobile gear near fixed salmon nets]:
On Question, Whether Clauses 1 and 2 shall stand part of the Bill?
Lord Carmichael of Kelvingrove: On Clause 1, I am disappointed that the noble Lord did not feel that anything had been said on Second Reading that gave him an opportunity to put down amendments to the Bill to give considerably more flexibility to this clause than seems to be in it. We are left with the fact that the Secretary of State will make orders, with very little time for discussion either in this House or in another place, and these orders will be very important to fishing in Scottish waters. We remain unconvinced that this is the best way to settle local differences between fishermen. However, local management has been firmly rejected by the Government and we now have to rely on the sensitivity with which the Secretary of State uses his powers under Clause 1 of the Bill. This is why I wanted to speak now on this clause.
I would agree that the latest set of proposals for the designation of static gear reserves, and thus of the areas shown on the map which is now in the Library, are much more encouraging than we expected: this is much better than the 1981 consultation document. The idea that static gear reserves can be designated on a seasonal basis is also, I feel, quite an advance. I wonder whether the Minister would consider, because I think it could be helpful, looking at the Clyde and Argyll waters as well as the Western Isles waters with the same idea of a seasonal approach: that is, of course, only if there is a local demand for such a method of proceeding.
Having decided to go for central control over the designation of reserves, the Government, through their officials, must now ensure that there is continuing flexibility and responsiveness, so that, in line with changing patterns and developing attitudes to fishing protection, will be given to the static gear interests where it is genuinely needed, without—and this is

965
where the real difficulty arises—unnecessarily inhibiting the trawl fishermen or fishermen using any other method.
I am sure the Minister has read the statements by some of the fishermen's leaders in the West Highland Free Press. I merely mention this point to try and make it clear what difficulties are faced. One of the leaders was quoted in the paper as saying of the static gear reserves that he feared the reaction from trawler men could be, "Don't step out of line here or we will tow your creels away". That is a very severe criticism, or possible criticism, of the Act, unless the regulations are extremely flexible. No one wants anything like this to happen, and that applies, I am sure, to the trawl fishermen just as much as to the creel fishermen. It does put a great responsibility on the Government, and I am sure we all hope the Government will discharge the very great powers given under Clause 1 with diplomacy, caution, and, above all, a great deal of fairness.
Lord Grimond: I wonder whether I may ask the Minister two short questions before he replies to the official Opposition. A certain amount of dismay—if anything the Minister says could cause dismay—has been occasioned in Shetland by some of his remarks on Second Reading. I asked him about the prospects of a management scheme and he was rather dismissive of the possibility of any management scheme, although in the previous Parliament the Government had not been wholly opposed to it. Indeed, it is known that in Brussels it is looked on with some favour. In Shetland and Orkney there is considerable interest, and indeed enthusiasm, for a management scheme. The question I want to put to the Minister is whether he will have conversations with the Shetland and Orkney fishermen about their proposals for such a scheme. If so, it clearly might have an effect upon Clause 1 of this Bill.
The other question I should like to ask is this. As I read Clause 1, the offence is only in fishing. No offence is caused by merely moving through these areas which are to be reserved. There has in the past, as he will know, been a certain amount of trouble with fishing boats moving through areas in which there are fixed and indeed movable fishing gear. As I understand it, the Bill deals only with fishing and not with movement through these grounds which have been designated on the map.
Lord Gray of Contin: I am grateful to the noble Lord who opened for the Opposition on the Question, Whether Clauses 1 and 2 shall stand part of the Bill? The noble Lord, Lord Carmichael of Kelvingrove, was very fair in what he said, and the noble Lord, Lord Grimond, also was constructive in his remarks. I shall try to deal with the points raised; but perhaps I may first say to the noble Lord, Lord Carmichael, that I very carefully studied all that was said on Second Reading, and the reason why I have not brought forward Government amendments to these clauses is that, quite frankly, I did not see anything which I considered would improve on what the Government intend in them. The noble Lord himself highlighted the point I want to make by asking me to assure your
966
Lordships that the Government will be flexible, and that is precisely what we have been so far.
The noble Lord referred to the West Highland Free Press. That is not a publication renowned for its support of the Conservative Party, but in one of its recent issues it was very reasonable and fair in what it said and acknowledged that my officials had gone to a great deal of trouble to take account of local feeling regarding the location of static gear areas, and had responded considerably to local suggestions. That is the way in which we hope to proceed. It certainly is not the intention of the Government to be dictatorial, and we should like to proceed on a basis whereby we take account of local feelings.
The noble Lord, Lord Grimond, again raised the question of local management, particularly as it affects his former constituency of Orkney and Shetland, and that area. The Secretary of State has the power under existing legislation to oversee the regulation and development of the Scottish fishing industry as a whole. We feel that this situation ought to continue. To add a further level of control would run the risk of proliferating administrative bodies and agencies. There would be further rules to be learned by an industry which arguably already has more than enough red tape to face. However, I continue to see a place for local participation, and particularly for local advice, to be provided. The Secretary of State will be perfectly content to listen to the views of local interests before taking managerial decisions on the fisheries.
As regards Shetland, the Shetland fleet itself is a nomadic fleet. It certainly does not do all its fishing around the Shetlands, and I would argue that, although the desire of local fishermen would be for local management, in fact it could well act adversely for them in the long run. I explained on Second Reading that one of my reservations about local management is that there would be a danger that local communities would be so anxious to protect their own interests that they would deprive themselves of participation in other areas. If every local management area took the same view there would be a great restriction of fishing, and that is not in the nature of the fishing industry. The fishing industry in Scotland is a nomadic industry, and likes to move from place to place. I believe that we have found a way in which, by the creation of nursery areas and of static gear reserves, and the removal of the ban within the three-mile limit for bottom trawling, we are now giving everyone a better opportunity to catch fish.
The noble Lord asked about moving through the static gear reserves, and certainly bottom trawling, or trawling of any kind, will be prohibited within those areas. Damage to creels, even when moving through, would be an offence. The offence will be to damage static gear within a static gear area. I hope that answers the two questions which the noble Lord put to me. However, I should like to emphasise to him that of course I shall be very happy to meet fishermen from the area if they care to come and see me, but we are not prepared to change the principle. We believe that what we have in mind is a better solution than local management, but we shall certainly listen to advice from within on how we proceed.
Clauses 1 and 2 agreed to.
6.5 p.m.
Clause 3 [Offences]:
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 1:
Page 2, line 20, at end insert—
("(2A) Proceedings for an offence under this section or section 5 of this Act may be taken in any sheriff court, and the offence dealt with by the sheriff in every respect as if the offence had been committed wholly within his jurisdiction.").
The noble Lord said: This amendment clarifies the position of the sheriff in relation to offences under the Bill. It makes it clear that in this case a sheriff's jurisdiction extends out with the bounds of his sheriffdom to encompass the waters covered by the Bill; in other words, the sea adjacent to the coast of Scotland and landward of the six-mile limit.
The amendment confers jurisdiction on any sheriff court to try offences under Clause 3 or Clause 5. It also provides that these proceedings may be taken in any sheriff court irrespective of where the offence occurred. This is only right since, under the Bill, an offending fishing boat may be taken to the nearest convenient port, which may not necessarily be located within the nearest sheriffdom. Allowing such a flexibility, which is also found in other fisheries legislation, will permit the optimum use of court resources as well as, in many cases, reducing the inconvenience to the fishermen involved. They will not be obliged to return to the scene of the crime, so to speak. I beg to move.
Lord Carmichael of Kelvingrove: I do not wish to be nit-picking, but I am concerned about the idea that any sheriff court can deal with an offence. I understand the point that because waters do not necessarily exactly correspond to a sheriffdom there may be difficulties, but when I first read this provision I felt it was taking matters too far. One presumes that perhaps the Falkirk sheriff court or the Hamilton sheriff court could deal with an offence. My concern therefore is that, assuming everyone is innocent until proved guilty, there could be a great deal of inconvenience if the port to which a boat is taken is a long way from its base port. I can see considerable difficulties in that respect.
For example, I am sure that the noble Lord, Lord Grimond, would find great difficulty if one of the boats from the Shetlands happened to be closer to the mainland. That could involve great expense. Will instructions be given to the fishery protection people to realise how delicate is the whole situation? The amendment may be one way out of the situation, but I would rather that there was a firmer agreement or a designation in the Bill itself.
Lord Gray of Contin: I can understand the concern expressed by the noble Lord, but in fact the purpose is to seek to ensure that for the convenience of the fishermen they are taken to the nearest port. We are very anxious about this and I believe that in moving this amendment we are ensuring that fishermen will be taken to the most convenient port. No one wants them to be taken somewhere that is a long way from their normal route.
The second point that the noble Lord made concerned the fishery protection service. The service will certainly bear the point that he mentioned in mind when it is carrying out its duties.
6.10 p.m.
Lord Hughes: I am not at all clear about the matter. As the noble Lord, Lord Gray of Contin, explained, the effect of the amendment would be to allow the offence to go to any sheriff court. I am not clear about what the position would be if the amendment did not go into the Bill. The clause ends with the words:
"shall be disposed of as the court may direct".
I cannot claim that I have read every word of the Bill. I did not expect to be involved in it. Somewhere in the Bill there may be a definition of the court to which the offences would go, but there was no reference to the sheriff court until this amendment appeared, unless I have missed it. May I ask whether I have missed anything? Is there a reference to the sheriff court elsewhere in the Bill?
Lord Gray of Contin: I am bound to admit that I cannot answer that point until I have advice.
Lord Hughes: If the Minister goes slowly I am sure the advice will come.
Lord Gray of Contin: I shall try to clarify the point a little. The amendment makes it clear that in this case a sheriff's jurisdiction extends out with the bounds of his sheriffdom. The purpose of the amendment is to encompass the waters covered by the Bill, in other words, the sea adjacent to the coast and landward within the six-mile limit. The amendment confers jurisdiction on any sheriff court to try offences under Clauses 3 or 5. The noble Lord, Lord Hughes, asked what the position would be if we did not include the amendment. The reason for the amendment is that the jurisdiction would have been conferred only on specific sheriff courts, but my advice is that because of the sea element it would be more realistic to confer jurisdiction on any sheriff court for the sake of convenience. The offending skipper could then be dealt with at the most convenient sheriff court, which might not necessarily be in the sheriffdom in a landward sense in which the offence was committed.
Lord Hughes: Although the noble Lord accepted my advice and talked slowly, and his noble friend moved fast, it has taken an awful long time for the answer to become available. The noble Lord has not answered my question. Have I missed a reference in the Bill to the sheriff court? If the only relevant words are,
"as the court may direct",
unless there is a definition, it could be any court from what used to be called the local police court up to the High Court.
Lord Gray of Contin: My advice is that if the amendment does not go in in order to do what the Bill intends, the sheriff will not be able to try the offence because his existing jurisdiction is not out with his landward area. That is why this specific jurisdiction is being sought to be given to the sheriff so that the offending skipper can be tried in any sheriff court.
Lord Hughes: If I understand the explantion, the Bill, as it stands, describes the offence in Clause 3(1), and in subsections (2) and (3) it decides what the

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penalties are. Without the amendment it would appear that no court in the land has authority to deal with the matter. I am certain that that is not the position, but it has not been explained to me what the intention in the Bill was before the amendment was put down. When a Bill defines offences, lays down the penalties that may be imposed and includes both summary trial and indictment, presumably it is expected that some court will deal with the offences. I made it clear that I might have missed the reference, but in the Bill as it stands where does it say that the offence will be tried in a sheriff court?
Lord Gray of Contin: In Clause 3(2) the noble Lord will find that the offence may be tried—
Lord Hughes: No. Clause 3(2) lays down the penalty.
Lord Gray of Contin: It also specifies how the offence is to be tried. Clause 3 states:
"(2) Any person guilty of an offence under this section shall be liable on summary conviction to a fine not exceeding £5,000 or, on conviction on indictment, to a fine.
(3) The court by or before which a person is convicted of an offence under this section may, in addition to imposing any penalty under subsection (2) above".
The normal court to try such an offence would be the sheriff court. There is no need for a specific definition of a sheriff court. In Scotland that is the appropriate court for such an offence. By implication, as it stands, the Bill allows trial in a sheriff court, or, if the offence was very serious indeed, for it to be tried in the High Court. But the normal court to try such an offence would be the sheriff court.
Lord Hughes: If the sheriff court is the normal court, presumably there is provision for that in some other piece of legislation. Things do not fall out of the sky and land in a particular court. Before the next stage of the Bill, I should be obliged if the noble Lord would acquaint me with the legislation which makes the sheriff court the normal court to deal with such offences. I cannot accept that it is reasonable to proceed with a Bill in which, merely by implication, the sheriff court deals with an offence. We do some funny things in legislation, but merely to imply which court will deal with the matter is taking things a little too far. I think that I have harried the Minister enough on the point at this stage. As I said, I did not expect to be involved in the Bill; otherwise, I should have given him notice that I would query that point. I apologise for not giving him notice, but I hope that he can enlighten me further before the next stage of the Bill.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Clause 4 [Powers of sea-fishery officers]:
6.18 p.m.
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 2:
Page 3, line 12, leave out paragraph (b) and insert—
("(b) may require any person on board the boat to produce any document relating to the boat, to its fishing operations or other operations ancillary thereto or to the persons on board
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which is in his custody or possession and may take copies of any such document;
(c) for the purpose of ascertaining whether the master, owner or charterer of the boat has committed an offence under this Act, may search the boat for any such document and may require any person on board the boat to do anything which appears to him to be necessary for facilitating the search;
(d) where the boat is one in relation to which he has reason to suspect that such an offence has been committed, may seize and detain any such document produced to him or found on board for the purpose of enabling the document to be used as evidence in proceedings for the offence,
but nothing in paragraph (d) above shall permit any document required by law to be carried on board the boat to be seized and detained except while the boat is detained in a port.").
The noble Lord said: It is our intention that the powers of enforcement available to British sea fishery officers under the Bill should be the same as those presently available to such officers under other legislation, in particular the Sea Fish (Conservation) Act 1967 and the Sea Fisheries Act 1968. We have also felt it right to spell out these powers in the Bill rather than have them attracted to it by reference to other Acts.
Unfortunately, in preparing the Bill an amendment to these earlier Acts contained in the Fisheries Act 1981 was overlooked. The amendment widened the powers of British sea fishery officers to search for and seize documents on board fishing boats. It seems appropriate that these wider powers should also be available under the Bill; this intention is given effect by the amendment. The powers of the fishery officers under the Bill will then be aligned with those in other Acts.
The amendment provides that the fishery officer may examine documents relating to the boat and its fishing operations including "unofficial" papers. In some cases these unofficial papers, such as the skipper's private fishing log, may be more revealing than the official papers in the detection of an offence. The amendment also provides for the fishery officer to search for any such documents in order to ascertain whether an offence has been committed. Where there is reason to suspect an offence, the fishery officer may also seize such documents for production as evidence in court. In some cases a copy of the documents may not be sufficient and there may be a risk of the original being destroyed.
The Government believe that these powers are necessary if the provisions of the Bill are to be properly enforced. They are not new but, as I explained, are already available under other legislation, and should be available under this Bill. I beg to move that this amendment be accepted.
Lord Grimond: I should like to raise two points about the amendment before we depart from it. I know that these extremely wide powers are available to fishery officers under other legislation, but I still think we ought to be told whether they are necessary, because they are exceedingly wide. I should like to draw the attention of your Lordships' Committee to the wording of paragraph (c) of the amendment, which states that:
"for the purpose of ascertaining whether the master, owner or charterer of the boat has committed an offence under this Act"
the fishery officer,

971
"may search the boat for any such document and may require any person on board the boat to do anything which appears to him to be necessary for facilitating the search".
I think I am right in saying that no police officer has any such power, In fact do not think that a police officer could carry out any such search without a warrant. I know that these powers are contained in other legislation and perhaps we should pass them, but I think we should raise the point that we are giving to fishery officers powers which I do not think—though I may be subject to correction—the police possess.
I turn to my second point. It is only when we come to Clause 4(5) of the Bill that there is a reference to it appearing to a fishery officer that an offence under the Bill has been committed. That phrase does not appear until half way down the clause and I should have thought that it ought to have appeared at the start of the clause. The officer should have grounds for suspecting that an offence has been committed and he should be examinable in court as to his reasons for suspecting that such an offence might be committed before he can exercise the very wide powers given under the clause in general. I should be grateful if the Minister would again look at those two points.
Lord Gray of Contin: I think it is right that we should be absolutely sure that the powers which we seek to give to the British sea fishery officers under the Bill are necessary. Perhaps I may explain to the noble Lord that the powers of British sea fishery officers require to be very widely based because the officers are dealing with immediate situations, which arise at sea or in harbour where the commission of an offence could be easily obscured. The detection of an offence and the collection of evidence can be frustrated unless the fishery officer is able to search a vessel, examine its catch and its gear, question the crew, and take the vessel to port for further investigation or for detention. He must also be able to seize fish, if necessary, and seize gear and documents for evidential purposes. These powers may appear sweeping, but they are necessary for adequate enforcement of the Bill's provisions. The powers duplicate those currently available in other fisheries legislation.
I believe that without thinking very carefully about the matter it is difficult for us to realise the situation in which the fishery officers can at times find themselves. where they have to take very quick decisions. The powers which we are seeking to give the fishery officers are the same as those which are already available in other legislation, and we feel that they are justified for the purpose of their carrying out their duties.
Lord Grimond: Have we any evidence that the powers have been justified? Have the fishery officers said that they could not do their duty without the powers? Have there been any cases in which the powers have been essential? It seems to me that otherwise we shall be writing the powers into statute after statute, without any examination as to whether or not they are necessary. The urgency cannot be so very great; the provision is concerned only with documents. There are plenty of powers to detain a fishing boat in port, to prevent it from taking to sea until the documents can be examined. I should like a little more
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assurance that there has been some investigation of whether these powers have proved to be necessary in practice.
Lord Gray of Contin: Let us take the question of entering premises on shore in order to examine documents relating to fishing activities. This ability and the power to search for documents is important if sufficient evidence to prove an offence is to be obtained. A requirement first to obtain a search warrant would merely serve notice on the offender and provide time for the incriminating evidence to be removed. Existing United Kingdom primary fisheries legislation does not contain a requirement for a search warrant to be obtained, and it would be inappropriate to create such a requirement solely in relation to inshore fishing in Scotland.
In reply to the noble Lord's question as to whether we are satisfied that the powers are necessary, I would say yes, we are satisfied that they are necessary. I know of a particular case where a conviction was obtained only as a result of evidence which was taken from the skipper's private log as opposed to the official log. That is important because if there is available a record, even though it is not an official record, the court should be able to benefit from what it contains.
I find it difficult to convince the noble Lord, and I agree that he is right to question me on the point; but I can assure him that the best advice available to me is that the provisions are necessary in order to enable the officers to carry out their duty effectively.
Lord Grimond: I am sorry that the Minister is having difficulty in convincing me. However, I was thinking that if we were entitled to demand the noble Lord's diary, or if we were to get someone else to produce it, and we were to read in it the appalling things that he does in his spare time, there would indeed be some reaction; but that is what he is holding out as being necessary in regard to fishery law.
Lord Gray of Contin: I do not want to become involved with the noble Lord in points about personalities, but it would be a different matter if there was any question of an offence being committed. If an offence were being committed, by whosoever it may be, personal logs or diaries would be legitimate evidence.
The noble Lord asked whether there is evidence that the fishery officers cannot do their job effectively without the powers. The answer to that question is, yes. Because enforcement is carried out at sea the powers have to be wider than might be necessary on shore, since no additional assistance is available to the fishery officer; he has to act on his own initiative. For all those reasons, we believe that the powers are necessary; they are powers which exist in other legislation.
Viscount Massereene and Ferrard: I should like to ask my noble friend a question. What is the position if the fishery officer suspects smuggling, or perhaps sees stolen sheep—and I have known that happen on fishing boats—or even drugs? About two years ago there was a case where a boat was full of drugs, and they were jettisoned over the side. Does the fishery

973
officer have authority to exercise such powers, other than in regard to fish, if he suspects smuggling or finds on boats stolen goods and such like?
Lord Gray of Contin: No, I do not think that he does. The power of the fishery officer is restricted entirely to fishery matters.
Lord Boothby: I had my doubts, but the noble Lord, Lord Gray, has convinced me that this amendment is necessary.
Lord Carmichael of Kelvingrove: In many ways, when we discuss fishing I am strictly out of my depth, but I feel that the basic point made by the noble Lord, Lord Grimond, is particularly apposite in this year of 1984. The noble Lord made the point that one has to read a fairly long way down the clause before finding that there should be reasonable grounds for believing that an offence has been committed.
There have been plenty of amendments to the Bill so far considering its size. I wonder, therefore, whether the Minister will take the amendment back to consider the possibility of emphasising, before the Bill reaches its next stage, that it is only when there is good reason for the fishery officer to believe that an offence has been committed that this machinery or these actions should be set in motion. As the noble Lord, Lord Grimond, remarked, the fishery officer should be able to prove that he had reasons to believe that an offence had been committed before taking these steps.
Lord Gray of Contin: With respect, I should perhaps explain that there is nothing new in what we are seeking to do. We seek to include in this legislation the same provision as exists elsewhere; so we are not seeking to do anything new. As I have explained, it was purely due to an oversight that this was not included in the original Bill. We are convinced that it is important, and, indeed, that it is essential, for the provision to appear so that under this legislation officers will be acting in the same way as they would act under other fishery legislation. For that reason, I would ask your Lordships to accept the amendment at this stage.
Lord Hughes: We shall note that explanation with interest and keep it in our minds for use on future occasions. So often in your Lordships' Committee, when amendments have been put forward to a piece of legislation, we have been told that they are not necessary because the powers already exist under other legislation. In fact, that was the answer in relation to the sheriff court—that it already exists under other legislation, or by implication. So here is a case where, although the Minister says that it already exists under other legislation, we are going to make sure. We are to have belt and braces, and repeat it in this Bill. It is therefore a useful precedent. Incidentally, the reference to 1984 prompts me to say that I think that the noble Lord, Lord Gray of Contin, would be terribly miscast as Big Brother.
On Question, amendment agreed to.
Clause 4, as amended, agreed to.
Clauses 5 and 6 agreed to.
Clause 7 [Interpretation]:
6.33 p.m.
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 3:
Page 5, line 9, at end insert—
(""master" includes, in relation to any fishing boat, the person for the time being in command or charge of the boat:").
The noble Lord said: This is a simple and straight-forward amendment that rectifies an omission in the present print of the Bill. It provides a definition for the term "master", which is referred to in several clauses of the Bill. The definition given is identical to that used in other modern fisheries legislation, and gives the term its simplest meaning; namely, the master is the person who is presently in charge of the boat whether or not that person is qualified. I beg to move that the amendment be accepted.
Lord Hughes: As the Minister has said, this is a simple amendment. There is no difficulty in under-standing it. That is a merit in itself in the present Government's legislation. I am always anxious to expand my knowledge of legal English, as distinct from everyday usage. The Minister can perhaps tell me the difference between being "in command" of a boat and being "in charge" of a boat, and why it is necessary to have both.
Lord Gray of Contin: I think the noble Lord is nitpicking a little. The amendment provides a definition for the term "master", and it is referred to in several clauses of the Bill. The definition given is identical to that used elsewhere, as I have already explained. The master is the person who is presently in charge. The term "in charge of the boat" is used principally to explain the function of the master, the person who is at the helm, the person who is in charge of the boat at that particular time. If the master has to sleep and someone takes over for him, then, in the terms of this legislation, for that period of time, the person at the helm is deemed to be the master. The term "in charge" is purely to clarify what the master would be doing.
Lord Hughes: That is most interesting. It is also quite amusing to find that the Minister, when asked the difference between being "in command" and being "in charge", used all along the term "in charge" of the boat. He did not find it necessary to talk about someone being "in command" of the boat. This seems to be another example of adding needless words to a piece of legislation, unless there is some legal difference, as I mentioned earlier, between being "in command" or being "in charge". I do not know. But it is certainly not a matter that I would wish to pursue much further unless the latest expedition of the noble Lord, Lord Lyell, has produced an explanation.
Lord Gray of Contin: I do not think that the explanation is any better than the one I gave.
Lord Hughes: That would seem to indicate that there should be some change of the law in the box.
Lady Saltoun: I wonder whether I might offer a word that could possibly clarify the matter. The master of a fishing boat fishing off Scotland often does not command the crew; he often leads them. He is in charge, but not in command.
Lord Hughes: That would seem to be a reason for leaving out "in command", if even the master is not in command of the boat.
On Question, amendment agreed to.
Clause 7, as amended, agreed to.
Clause 8 agreed to.
Clause 9 [Citation, commencement, transitional provisions and extent]:
On Question, Whether Clause 9 shall stand part of the Bill?
The Duke of Atholl: I wonder whether the Minister can enlighten me as to the date on which this Act is likely to be brought into force. Under Clause 9(2), the Government will need to make orders to bring it into force. Can he give any indication when this is likely?
Lord Gray of Contin: I think I can best answer my noble friend by saying that it will be as soon as possible, and certainly by the summer.
Clause 9 agreed to.
Schedule 1 [Minor and Consequential Amendments]:
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 4:
Page 6, line 4, leave out ("Fishing") and insert ("Fishery").
The noble Lord said: In moving Amendment No. 4, I wish also to speak to Amendment No. 5.
Amendment No. 5: Page 6, line 8, leave out ("Contravention") and insert ("Conservation").
Both the amendment to line 4 and the amendment to line 8 simply correct errors in Schedule 1. In the first case the reference should be to the "Fishery Board" and not the "Fishing Board" as printed. In the second, the Act referred to should be the Sea Fish (Conservation) Act 1967. I beg to move that both these drafting amendments be accepted.
On Question, amendment agreed to.
Lord Gray of Contin Lord Gray of Contin moved Amendment No. 5:
[Printed above.]
On Question, amendment agreed to.
Schedule 1, as amended, agreed to.
Schedule 2 [Repeals]:
Lord Gray of Contin Lord Gray of Contin moved Amendments Nos. 6, 7, 8 and 9:
Page 7, column 3, leave out lines 7 to 12 and insert ("The whole Act.")
Page 7, column 3, leave out lines 7 to 12 and insert ("The whole Act.")
Page 7, column 3, leave out line 21 and insert ("The whole Act.")
Page 7, column 3, leave out line 25 and insert ("The whole Act.").
The noble Lord said: These amendments simply remove references to specified provisions of certain Acts in the repeals schedule, and replace them with references to the whole Act. In this way authority will be given to remove all reference to these Acts from the statute book. Otherwise all that would be left would be the preamble or short title, the operative provisions having all been repealed. I beg to move that these amendments be accepted.
Lord Hughes: These four amendments are all in the same pattern and would indicate that when the sections which are at present in the third column were removed, there would be nothing left but the preamble or short title. Was the Bill drafted in such a terrible hurry that so many mistakes were made and nobody noticed that if we took out these remaining sections we would be asking the Committee to legislate to leave in four Acts with only a title and a preamble? It certainly does indicate that the usual high standard has hardly been achieved in this Bill.
Lord Gray of Contin: I absolutely defend the draftsmen who prepared this Bill. Certainly from my experience in another place I cannot on any occasion recall a Bill where there were not a number of Government amendments tidying up small matters of this sort which had been overlooked presumably in the anxiety of the draftsmen to make sure that all the major issues were properly covered. I think that the draftsmen have done a very good job in this Bill and I am glad that even at this late stage they have been sufficiently observant to note those small points, and that we are now putting them right.
Lord Hughes: I would not wish it to become the pattern that we should attack people in this House who are doing a job. That was certainly not my intention. I did say that this did not come up to the usual high standard. Frequently perhaps what south of the Border would be regarded as odious comparisons have been made between draftsmen south of the Border and those in Scotland. All I said was that this certainly is not up to their normal standards.
Lord Boothby: Before we end this Committee stage I should just like to say to the noble Lord that I think that at the end of the day, whatever slips the draftsmen may have made, we have a jolly good Bill which can do nothing but good to the inshore fishing industry for which I have fought for 40 years.
On Question, amendments agreed to.
Schedule 2, as amended, agreed to.
House resumed: Bill reported with amendments.

Roads (Scotland) Bill [H.L.]
6.46 p.m.
The Lord Advocate (Lord Mackay of Clashfern): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Mackay of Clashfern.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD NUGENT OF GUILDFORD in the Chair.]
Clause 2 [Powers and duties of Secretary of State as roads authority: management and maintenance]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 22:
[Printed earlier: col. 652.]
The noble and learned Lord said: This amendment is similar to the amendment that I moved in respect of Clause 1 and was particularly introduced in order to facilitate the creation of particular roads on which cyclists could cycle. I beg to move.
On Question, amendment agreed to.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 23:
Page 3, line 41, leave out ("for the time being").
The noble Lord said: I feel that in this Bill there will be a great many occasions upon which we shall be asking either for words to be taken out or for words to be put in to make the Bill more intelligible to lay people. This particular amendment to page 3, line 41, to leave out "for the time being" is one of those occasions.
I do not understand why there have been quite so many amendments to the Bill. I do not think that we can blame the draftsmen on this occasion; it seems much more as though it was the policy taken at the top level in the Scottish Office not to put down the guillotine at a certain point and say, "That is it. Finish". I am sure that with all this enormous amount of roads legislation we could go on polishing and polishing all the time.
This particular amendment seems to me to be dealing with a matter which is superfluous. I will be interested to hear the noble and learned Lord's interpretation of it. It seems to me that the Secretary of State will, in any case, be keeping a list of roads of which he is actually in control and for which he is responsible. The minute he ceases to be responsible for a road it will be removed from the list. That is why the words, "for the time being" seem to me to be superfluous. The moment he loses control of a road or he gives up control of a road, he is no longer liable to keep it on a list. It may be a small point but I feel that the wording in question is unnecessary unless there is some legal explanation which will clarify it for me. I beg to move.
Lord Mackay of Clashfern: As the noble Lord says, most of the amendments are concerned with no deep matter of policy but with just the phraseology in which these particular provisions are expressed. The purpose of using the phrase "for the time being" is precisely to emphasise the need to keep these lists up to date. In fact, at the moment the Secretary of State does have some obligation in this matter, but not in primary legislation. If we are to have a primary legislation responsibility to keep a list, it is very important that it should be a list which is up to date. It is in order to emphasise that, that the phrase "for the time being" is being incorporated.
The noble Lord, with his great experience of transport behind him, will I am sure be very much aware of the necessity for the lists—which have very important consequences—to be up to date. The informal lists have not always been easy to keep up to date. I hope that in the light of that explanation the noble Lord will feel able to agree that it is better to have these words in.
Lord Carmichael of Kelvingrove: I can see the point made by the Lord Advocate. The only point that arises
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is how does an individual who goes to ascertain whether a road is a Secretary of State road, or whether it is a road that should be on the list "for the time being", is actually up to date? How do we get round this difficulty of the list actually being up to date? Someone may in all honesty go to the Secretary of State, look at the list, see the list of roads and say, "Yes, this is" or "this is not under the responsibility of the Secretary of State". Then he is told, "Ah, but for the time being. It was changed yesterday" or "the day before".
It is a point that I do not want to make too much of, but having been in the position of going to official offices and being told that things have changed since yesterday, I wonder how we can make it clear that the roads will be on the list, and will be taken off the list immediately, or put on to the list immediately they become the responsibility, or not, of the Secretary of State.
Lord Mackay of Clashfern: That is precisely the purpose of these words, to put that duty on the Secretary of State, and the Secretary of State will have a responsibility to see that the arrangements which he makes through his officials have the effect that the noble Lord says. I agree with him that it is frustrating to go to one of these registers and find that they are out of date. It is misleading. The purpose of this is to ensure that the Secretary of State will have the responsibility, and it will be his job to see that it is efficiently carried out. I am much obliged to the noble Lord.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 24 not moved.]
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 25:
Page 4, line 2, leave out ("free of charge").
The noble Lord said: This is a probing amendment to find out from the Lord Advocate how frequently these lists are actually referred to. Is it a constant business that they are referred to? How is public time to be saved when people make unnecessary demands to look at the lists? While saying this, it struck me to ask where the lists are kept. It may say somewhere in the Bill. Where are they available other than in Edinburgh? Are they available in the roads offices in Glasgow, Aberdeen, Perth, Dumfries, and various places like that? I beg to move.
Lord Mackay of Clashfern: We have no evidence that excessive use is made of such lists as have to be kept at the moment. The Secretary of State is taking this responsibility, and it seems right that the lists should be available for inspection free of charge. Regarding the places that they are kept, the Secretary of State will keep his lists at the Secretary of State's Office, which would normally be I think at New St. Andrew's House, or where the Roads Division office is. The local roads authorities have responsibilities and they will keep the lists at the appropriate offices of the local roads authority.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2, as amended, agreed to.
Clause 3 [Power of Secretary of State to make advances to local roads authorities etc.].
Lord Hughes Lord Hughes moved Amendment No. 26:
Page 4, line 9, leave out ("subject to subsection (2)(b)(iii) below")
The noble Lord said: Amendment No. 26 is a paving amendment for Amendment No. 36.
Amendment No. 36: Page 4, line 36, leave out sub-paragraph (iii).
I wish to say right away that the purpose of these amendments is to seek information. I would therefore go to the substance of Amendment No. 36 to leave out paragraph (b)(iii):
"shall be made only where it appears to the Secretary of State that the whole or any part of the expenditure in respect of which such advances could be made should not fall on the authority."
Would I be correct in assuming that this does not in any way alter the way in which the Secretary of State would be making advances for road purposes? Is it correct that it does not give him power to say in some particular case, "I am sorry, but I am not giving you anything at all on this" although the roads authority might have expected to have substantial grant towards its purpose? Am I right in assuming that this is merely a protection for the ordinary way in which grant would be paid to a roads authority? I beg to move Amendment No. 26.
Lord Mackay of Clashfern: I am obliged to the noble Lord for making the purpose of these two amendments so clear. The answer is that an advance made under this power would free the local authority altogether from the burden of this particular payment. The purpose of the particular provision is to make it clear that this power is to be used only when the Secretary of State thinks that is the way it should be. It comes exactly from the Local Government (Scotland) Act 1975 when this power was introduced, and the noble Lord will perhaps know more about that than I do. This is not changing the existing law, it is merely continuing the conditions under which under the existing law these advances may be made. I hope this answers the noble Lord's question.
Lord Hughes: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hughes Lord Hughes moved Amendment No. 27:
Page 4, line 11 leave out ("(other than advances in respect of the acquisition of land)")
The noble Lord said: This is a series of amendments, the purpose of which is to make the clause more easily understood and to cut down a certain amount of the verbiage. It is perhaps one of the regrettable things that if you want to cut down written verbiage you have to do an awful lot of talking verbiage. The amendments which follow from Amendment No. 27 are Amendments Nos. 29 to 34 inclusive, and Amendments Nos. 36A and 38A.
Amendment No. 29: Page 4, line 18, leave out paragraph (b).
Amendment No. 30: Page 4, line 22, after ("mentioned") insert ("in subsection (1) above may include—
(a) advances in respect of the acquisition of land by them where he is satisfied that the land has been or is to be acquired by the authority with a view to the construction of a new road or the improvement of a road.")
Amendment No. 31: Page 4, leave out line 23 and insert ("(b)")
Amendment No. 32: Page 4, leave out line 29.
Amendment No. 33: Page 4, line 30, leave out ("(i) may include") and insert ("(c)").
Amendment No. 34: Page 4, line 33, leave out ("(ii) may include") and insert ("(d)").
Amendment No. 36A: Page 5, line 3, leave out from ("(3)") to ("above") in line 4 and insert ("The advances mentioned in subsection (2)(a)").
Amendment No. 38A: Page 5, line 19, leave out ("(a) or (b) and insert ("or (2)(a)").
I had looked at the possibility of tabling a new amendment putting all these together and showing clearly how the clause would stand. Then I found that it was impossible because there were other amendments in the course of the consideration of this clause which are not just a changing of the way it is worded but are changes of a different nature.
We start with Amendment No. 27, which is to leave out,
"(other than advances in respect of the acquisition of land)".
I do not understand why the Bill is drafted in this way. I could have understood it if the clause rested only on subsection (1)(a), but here we have in (1)(a) the words,
"advances (other than advances in respect of the acquisition of land)"
taken out. Then go on to (b) which puts back in the words:
"advances in respect of the acquisition of land".
It would be better if we took out the words,
"(other than advances in respect of the acquisition of land)"
and then moved the paragraph related to
"advances in respect of the acquisition of land"
further down the clause along with the items which are mentioned where advances may be included.
If I can go through them, that is effected by Amendment No. 28, page 4, line 14, which takes out from "authority" to the word "to" in line 17. The next amendment leaves out paragraph (b), and so on. The effect of it is to simplify the reading of this clause. It would have been much easier if I could have put them all together, but because there are other amendments inside the clause I could not have rewritten the clause without then tabling amendments to alter what I had already done. It has to be done on this complicated basis.
Perhaps when he replies the Lord Advocate will make it quite clear why it has been found necessary to do it in the way in which it has been done here by, first, leaving out of account advances in respect of the acquisition of land and then putting in the phrase,
"advances in respect of the acquisition of land"
as a new paragraph. It is a complicated way of doing it and most of the amendments which follow arise from changing that particular part. I beg to move.
The Duke of Atholl: Having been a member of the Committee on the preparation of legislation I feel compelled to support the noble Lord. Lord Hughes, in

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moving his amendment and also the amendments that relate to it. It seems to me that this is an extremely complicated way of expressing a not very difficult idea. I hope that the Lord Advocate will agree to consider it again.
Further, I feel something of an expert on the acquisition of land for new roads; probably I have had more land acquired for new roads in the recent past than anyone else in your Lordships' House. On the whole the system has worked extremely well. But where the system reacts somewhat unfairly is when the line of a road goes through a building, cottage or a farmsteading, because it means that the building has to be replaced before the road is started. One is not paid for what is taken until the road is 90 per cent. completed, when one receives 90 per cent. of the compensation. One is therefore out of pocket for a very long time.
Personally the bank was kind to me when I had to replace a cottage. It was kind enough to loan me the money, but it was for longer than I anticipated because work on the road was delayed frequently and compensation did not turn up until about 18 months after it was originally expected. When I first saw the amendment of the noble Lord, Lord Hughes, I thought it had something to do with this and I was prepared to support it to the hilt. I now realise it does not, hut I still think it is a very good amendment.
Lord Mackay of Clashfern: I am grateful to the noble Lord for explaining his amendment so clearly. I sympathise entirely with the difficulty of making such a clear amendment under the mechanisms we have to use, which sometimes make simplicity look complicated. I understand exactly the result he wishes to achieve. There is, however, a problem which also enables me to answer the amendment in the way he suggested by explaining why we have done it this way.
The reason is that we require to treat differently advances in respect of the acquisition of land and advances which are not in respect of the acquisition of land. The noble Lord will see that in subsection (a) of the provision which deals with advances, other than advances in respect of the acquisition of land, the Secretary of State may make the advance to the authority, or—I refer to line 13 on page 4 of the Bill—
"make such advances in conjunction with such an authority…to any person".
That is the reason why one has to treat the two separately. I hope I have followed through the noble Lord's amendment, but I think I am right in saying that he has not made that provision when one follows his amendments through. He does not distinguish between the acquisition of land and the other provision.
There is much legislation on this subject which we have compressed into this provision, but the existing legislation distinguishes in this way. I believe that this is done as simply as it can be, preserving that necessary distinction.
Lord Hughes: I do not think the Lord Advocate is doing me justice in this matter—quite unwittingly, obviously. I do not alter the language being used. Amendment No. 30 moves the wording under
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subsection (1)(b) down as part of subsection (2). I have used exactly the same wording. Subsection (2) would read:
"The advances mentioned…in subsection (1) above may include"—
and at that point I bring in paragraph (b) as (a) of the second part; thus the distinction is maintained. What are included in subsection (2) are the details of the advances. The other alterations are only changes in paragraph numbers, and so on. The subsection continues:
"may include advances in connection with the exercise of any power…include advances for any purpose incidental, or conducive, to the purposes"—
and so on. It seemed to me that if there were any reason to elaborate on or distinguish between the type of advances that should be contained in the second paragraph, with the first paragraph referring to advances generally. So I have not in any way departed from the distinction by moving it down the page.
Lord Mackay of Clashfern: As I understand the position, the only way the noble Lord is able to simplify by changing the order is by obscuring the distinction between paragraphs (a) and (b) in the way I have said. That is how I followed his amendments and my understanding is that as his amendments take effect he has not been able to make it clear how the advance to any person, in the case of a conjunction between the Secretary of State and a local authority, is available. Possibly this is a matter we can consider further. But that is my difficulty about his reformulation.
Lord Hughes: I still do not understand because that formulation remains. I have not altered subsection (1)(a); it remains exactly as worded. What the noble and learned Lord the Lord Advocate has said is reasonable. I am sorry that with the intervention of the Christmas and New Year break there has not been an opportunity for consultation, but if the Lord Advocate is saying that he would be willing to look at this with me to endeavour to improve on or to simplify the way in which this clause is laid out, I should he very happy to withdraw the amendment. In the meantime, at the next stage either the Lord Advocate will table an alternative amendment upon which we may be agreed or I may table an amendment on which we can be agreed or, alternatively, if we cannot reach agreement I will table an amendment.
The Duke of Atholl: Will the Lord Advocate also consider my point? It is a serious point that someone has to put up money for rebuilding steadings, cottages or houses when a new road is threatened to go through them and the building of the new road appears often to be postponed, sometimes for up to 18 months or two years. This means that the landowner concerned is very much out of pocket for much longer than he thinks. The reason why I support the first amendment of the noble Lord, Lord Hughes, was that I thought the advance could be made to any person on the acquisition of land when the line of a new road was definitely agreed upon.
Lord Mackay of Clashfern: As my noble friend indicated ultimately, he realised that the amendment did not cover his point which was why I did not mention it especially. I am very happy to look into the matter to see whether anything can be done to deal with the difficulty that my noble friend has experienced.
The Deputy Chairman of Committees (Lord Nugent of Guildford): Does the noble Lord wish to withdraw Amendment No. 27?
Lord Hughes: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.8 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 28:
Page 4, line 14, leave out from ("authority") to ("to") in line 17.
The noble Lord said: This is an amendment seeking advice from the Lord Advocate about whether these words are necessary. They seem to form one of these phrases added to Acts of Parliament:
"(whether or not that authority is the roads authority by whom the road is, or as the case may be will be, maintainable) to any person"
This is one of those points that I feel to be worth considering and testing again at to whether the words are actually necessary.
Lord Mackay of Clashfern: I believe the words in the existing legislation are necessary in the sense that it may be possible. when somebody else is constructing a road, to make an advance of money which, in the opinion of the Secretary of State and the local authority, will provide public benefit more than just to the particular person who is constructing the road—a private landowner, for example, or an industrialist who may construct a road to his factory. By putting out a little extra money public benefit may be obtained, and it is the power to do that which is here in question. I do not think it is exercised very often, but I believe it is an important power to have in such circumstances. I hope the noble Lord will feel satisfied with that explanation.
Lord Carmichael of Kelvingrove: I am pleased with the explanation except that perhaps I could raise one point with the noble and learned Lord the Lord Advocate. When he was speaking, I was thinking in terms of airports and perhaps power stations, and places like that. Would such a road, under other legislation, be classified as a public road or a private road? The noble Lord, Lord Nugent, will be aware that in the other place, during the Committee stage of my own Seat Belts Bill, one Member took an entire Committee stage discussing what were public and private roads. These were exactly the points he made. He did it delightfully, but we lost the Bill because of it. He took two and a half hours to discuss whether a road was public or a private road. If a road was helped financially by the Secretary of State in these circumstances—and an airport or a power station were two of the examples given—would that be classified for the purposes of other legislation as a public or private road, or would it, again, depend upon a lot of other quite consequential things?
Lord Mackay of Clashfern: Among other things, the purpose of this Bill is to try to deal with claims, and a public road will be a road on the appropriate list now, unless it is a special road. The conditions under which it goes on the list are set out. What used to be called "taken over" (and I will come to this later) is now to be clarified as going on the list, with consequences. The mere fact that an advance is given does not necessarily mean that the resulting road will go on the list. It will still enable a public benefit to be conferred if the Secretary of State decides to make such an advance, but he would not make such an advance lightly to any other person. These are the circumstances which might apply; but it would not necessarily mean that the road, when constructed, or the improvement that is being made, when made, would make the road a public road in the sense of its going on the list of roads to be maintained by either a local roads authority or the Secretary of State.
Lord Carmichael of Kelvingrove: With that explanation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hughes Lord Hughes had given notice of his intention to move Amendments Nos. 29 to 34:
[Printed earlier: col. 980.]
The noble Lord said: Amendments Nos. 29 to 34 were among those to which I spoke, but in view of what the noble and learned Lord the Lord Advocate said in the discussion on Amendment No. 27, I do not wish to move these amendments.
[Amendments Nos. 29 to 34 not moved.]
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 35:
Page 4, line 34, leave out (", or conducive").
The noble Lord said: I have put down this amendment because "conducive" seems to me to be a superfluous word. I am sure the noble and learned Lord the Lord Advocate will be able to explain the reasons for the inclusion of this word, but it seems that "incidental to the purposes mentioned in those paragraphs" would be sufficient. I beg to move.
Lord Mackay of Clashfern: The purpose of including this word is to make it a little more flexible than "incidental". Powers to spend money of this sort are apt to be fairly strictly construed. The word "incidental" is a word which is often used in this connection. For example, things like geotechnical surveys to see whether a road is feasible in a particular position might not be regarded as incidental to the road because you might not ultimately' make the road at all. It is necessary to have fairly wide powers in this connection, and we felt that the word "conducive" was an appropriate word to connote some width in this respect. Landscaping is another possible head which might not be regarded as strictly incidental to the purposes of the road itself although very conducive to having a nice road when it is finished.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 36 and 36A not moved.]
7.17 p.m.
Lord Hughes Lord Hughes moved Amendment No. 37:
Page 5, line 11, leave out ("due").
The noble Lord said: Amendments Nos. 37 and 38 achieve the same purpose. On page 5, starting from line 7, we find the words:
"any amount by which the annual expenditure incurred by the authority in maintaining the land, during the period between its acquisition and the construction or improvement of the road in question, and in the payment of loan charges accruing due".
I cannot understand what is meant by these words. When I put down my amendment, I could not make up my mind whether to leave out the word "accruing" or to leave out the word "due". Either one or the other seemed to me to serve the purpose. I do not know; but if a sum of money has accrued, it is due. If it is due, it is bound to have accrued. This seems to me once again to illustrate the attempt to cover every possible contingency against some smart alec turning up in the courts and saying, "Yes, the money was due but had not accrued", or, "The money has accrued but is not due". I should like to know the legal reason for putting this cumbersome pair of words together.
Lord Mackay of Clashfern: The first answer is that this is the phrase that we have already. This is in the existing legislation, and we are trying to deal with that. The second point, I think, is that the phrase "accruing due" means more than just accruing, because the theory is that if you have interest on a loan it is accruing from day to day but usually the loan requires actual payments to be made on particular dates.
Let me try to give a very brief example. Suppose that the land for the road was acquired on 1st January, and let us say that the road was constructed even more quickly than is normal and was constructed by 1st April; but the loan was raised on condition that the interest on it is paid six-monthly. Now from 1st January to 1st April the interest has been accruing, but if the payments of interest are to be made only on 31st July and 31st December then interest has not accrued due during the period in which the land has been acquired but the road not yet constructed. So it has accrued but it has not accrued due, the accrual falling due on one of the term days. That is the reason for the phrase.
The noble Lord referred to smart alecs turning up in court. As the noble Lord knows very well from his experience as chairman of a Royal Commission and in other ways, the legislation has to cope with smart alecs. There are always some of these around, however undesirable they may be, and the legislation has to cope with them.
Lord Hughes: The noble and learned Lord has succeeded in convincing me that I left out the wrong word. If I had left out "accruing", the position would have been covered because, on his example, the money would have been due to be paid on 31st July. Incidentally, it would not have been so; it would have
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been 30th June, because that is six months from 1st January; so his law is better than his arithmetic. By the 30th June the money would be due, so it is the word "accruing" that is not necessary. I therefore hope that at the next stage when I move to leave out the word "accruing" he will than agree with me that we can save two words twice.
Lord Mackay of Clashfern: I am not certain the noble Lord will necessarily achieve simplification that way. Perhaps he will look at it again.
Lord Hughes: I beg leave to withdraw the amendment, on the understanding that I will look at it again and see if this massive alternative form of wording will be more acceptable.
Amendment, by leave, withdrawn.
[Amendments Nos. 38 and 38A not moved.]
Lord Hughes Lord Hughes moved Amendment No. 39:
Page 5, line 20, leave out from first ("by") to ("and") in line 21 and insert ("grant or loan or partly grant and partly loan").
The noble Lord said: Again this is an attempt to simplify matters. I should be interested to hear the justification for the wording that is in the Bill. If we look at the wording in the Bill, we see this:
"An advance under subsection (1)(a) or (b) above may be either by way of grant or by way of loan, or partly in one way and partly in the other".
The effect of these amendments would be that the following wording would appear:
"may be either by grant or loan or partly grant and partly loan".
I do not see why it is necessary to have the words "by way of" or "partly one way", and so on, repeated. This is again an attempt to make the wording in the Bill nearer to the everyday language that people would use. If the noble and learned Lord the Lord Advocate is not going to accept this, I hope he will not tell me that this is the way it has been done before. That is of no value at all in persuading me. If it is wrong I do not see any reason for accepting that even if it has been done 20 times before. If there is a second reason why these words have to be in, apart from the mere fact that they have been in legislation before, I should be glad to hear it. I beg to move.
Lord Mackay of Clashfern: Perhaps for variety's sake I should say that it appears to me that the present wording is one way in which this could be expressed and the amendment puts it in another way. Both ways are perfectly plain ways of expressing the same idea; but it so happens, the noble Lord will not be surprised to hear, that this phrase is in the legislation that we are seeking to codify. It has been used in Section 8(4) of the Development and Road Improvement Funds Act 1909, so it has been around for a while and that is why we have preferred this particular method. The result is exactly the same.
Lord Hughes: That seems to me a perfectly good reason for accepting the amendment, if fewer words can achieve exactly the same purpose.
On Question, amendment negatived.
Clause 3 agreed to.
Clause 4 [Agreements between authorities]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 40:
Page 5, line 36, leave out ("(3) to") and insert ("(4) and").
The noble and learned Lord said: This is a drafting amendment to correct an incorrect reference. I beg to move.
On Question, amendment agreed to.
Clause 4, as amended, agreed to.
Clause 5 [Trunk roads]:
Lord Hughes Lord Hughes moved Amendment No. 41:
Page 6, line 20, after ("agriculture") insert ("and industry").
The noble Lord said: I beg to move Amendment No. 41. On page 6, line 18, of the Bill it says:
"after taking into consideration the requirements of local and national planning, including the requirements of agriculture".
I do not object to that but I think we should include industry because very often industries can be very much affected by the way in which roads are planned. I know from my chairmanship of the New Town of East Kilbride that one of the things in which incoming industry is most interested is the road pattern. It seems to me quite reasonable that the needs of industry should be included as they need to be considered just as much as those of agriculture. I beg to move.
Lord Mackay of Clashfern: I am very happy to accept this amendment. May I suggest to the noble Lord that a similar passage occurs in Clause 7 on page 8? Perhaps he might feel able on the next occasion to put down a corresponding amendment.
Lord Hughes: May I say that there are a number of occasions where I have only dealt with the first time that some words appear. I took a rather charitable view of the Government's activities in that if they accepted the amendment they would search through the Bill for all the other places where the same thing has to be done. I am a firm believer in the doctrine, "if you have a dog, don't do your own barking."
On Question, amendment agreed to.
Lord Hughes Lord Hughes moved Amendment No. 42:
Page 7, line 12, leave out subsection (7).
The noble Lord said: I would point out right away that this is merely an amendment for the purpose of probing what is intended. It is a rather complicated lot of wording. The amendment seeks to leave out subsection (7). The Bill says on page 7, line 18:
"shall become a trunk road is revoked or varied by a subsequent order made at any time before the date on which that road is opened for the purposes of through traffic, the revoking or varying order shall not be deemed for the purposes of this section to be an order directing that a road shall cease to be a trunk road."
Can the noble and learned Lord the Lord Advocate explain in simpler language what this is meant to do?
Lord Mackay of Clashfern: As your Lordships will appreciate, when it is decided that what is a trunk road should cease to be a trunk road, a lot of people have to have their interests considered and there is an elaborate procedure for that purpose. The purpose of
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this subsection is to make it clear that that elaborate procedure is not required if the Secretary of State changes his mind before he has implemented the proposal. Obviously in that situation one does not want to have to go through the elaborate procedure when all that has happened is that he has changed his mind, but it is necessary or desirable that matters should be made public as soon as possible because, as your Lordships know very well, to have the line of a road lying on a map can cause planning blight. The intention is to kill the planning blight at the earliest opportunity without the elaborate procedures that are required for de-trunking, as it is called.
Lord Hughes: I am quite satisfied with that explanation and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hughes Lord Hughes moved Amendment No. 43:
Page 7, line 37, after ("authority") insert ("if they so decide").
The noble Lord said: This is following a point which I raised on Second Reading. As it stands at the present time, Clause 5(9) reads:
"A local roads authority may contribute towards costs incurred by the Secretary of State in the construction or improvement of any trunk road".
I have put down this amendment to insert "if they so decide", but looking at another part of the Bill I see that I ought to have adopted the wording which the Government have used in various places, which is "if they think fit". If the noble and learned Lord the Lord Advocate is disposed to accept the suggestion, I would beg leave to alter the wording to "if they think fit", because it is desirable when a Bill indicates that discretion might be exercised that the same form of words are used throughout. Otherwise, as the noble and learned Lord would say, you raise a doubt as to why you have used a different form of words.
The indication was given that it would be for the local authority to decide whether they were going to contribute, but, because of the number of times we have been told that in legislation "may" can include "shall", I want to make it quite certain that there is no mandatory requirement on the local authority to contribute, but that they may contribute "if they think fit". I beg to move.
Lord Mackay of Clashfern: I am extremely happy to accept this amendment and I should be very glad if the noble Lord would move it in the form of the second alternative that he used, "if they think fit". If your Lordships are prepared to accept the amendment in that form, I am happy to accept it like that for the reasons which the noble Lord has given. I hope that this is a good spirit in which to come to the dinner adjournment.
Lord Hughes: Is it possible within the working of the House to alter the wording from, "if they so decide" to, "if they think fit"?
The Deputy Chairman of Committees (Lord Nugent of Guildford): If your Lordships wish, I could accept a manuscript amendment to change the words from, "if they so decide" to, "if they think fit".
Lord Hughes: May I put it like that?
The Deputy Chairman of Committees: I will accept it as such. I will put the amended amendment. The amendment proposed is:
Page 7, line 37, after ("authority") insert ("if they think fit").
On Question, amendment agreed to.
Clause 5, as amended, agreed to.
The Earl of Swinton: This might be a convenient time to adjourn for dinner. I beg to move that the House do now adjourn during pleasure until 8.20 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.33 p.m. until 8.20 p.m.]
Clause 6 [Local and private Act functions with respect to trunk roads]
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 44:
Page 7, line 41, leave out (", repair").
The noble and learned Lord said: This amendment is designed to leave out the word "repair" because it is unnecessary in the light of the general definition of "maintenance". I beg to move.
On Question, amendment agreed to.
Clause 6, as amended, agreed to.
Clause 7 [General provision as to special roads]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 45:
Page 8,line 6, leave out (", and to be known as,").
The noble Lord said: It seems to me to be superfluous and slightly confusing to say:
"being roads provided in pursuance of a scheme made under section 1 of the Special Roads Act 1949, shall continue to be, and to be known as, special roads".
I should be pleased if the noble and learned Lord the Lord Advocate could explain whether the words "and to be known as" are really necessary. I beg to move.
Lord Mackay of Clashfern: It may be convenient to say something which bears upon a number of the other amendments which the noble Lord has tabled. As the noble Lord will appreciate, the Special Roads Act 1949 created the power to make roads which were called special roads. They have two main features. The first is that the Public Utilities Street Works Act does not apply. In other words, there is no right for public utility undertakings to put works in. The other special feature is that the classes of traffic may be readily regulated. As the noble Lord knows, the principal examples of this type of road are motorways. It is important that the roads authority should have a strong right to prevent people from putting equipment in.
We want to try to bring together as much as possible of the Scottish roads legislation. That is the purpose. We are not going to have the Special Roads Act but we are going to have to have special roads. The point of
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the particular matter referred to in the amendment is to allow those special roads which have already been constructed under the Special Roads Act to continue to enjoy the special features that they already enjoy under the régime in this Bill. I hope that explains the situation to the noble Lord.
Lord Carmichael of Kelvingrove: I am grateful to the noble and learned Lord the Lord Advocate for his explanation. It is important to repeat the very important point that these roads have special traffic designations and that there are no public utilities on them. Furthermore, why do we not call a spade a spade and just call them motorways? Although the noble and learned Lord the Lord Advocate suggested that motorways are the best known examples, I am wondering which special roads other than motorways have that designation. Ordinary members of the public speak in a particular way, while legally we speak in another way. It all contributes to the mystique of the legal process. I am happy with the explanation which has been given by the Lord Advocate, but I should be most grateful if he could explain why motorways cannot be called motorways.
Lord Drumalbyn:I should be grateful if at the same time my noble and learned friend could say what their abbreviated name is to be. Will some of the "A" roads be included?
Lord Mackay of Clashfern: They will continue to be named special roads. Normally they will be roads with a very high designation. The Edinburgh outer by-pass is another example of a special road. This is a matter of history. The Special Roads Act came first. The motorways were created under that Act. People called them motorways, but they were examples of special roads. It might have been possible to change the system and to describe them as motorways, but that would have required a great deal of change. We felt that it would be best to incorporate the existing statutory provisions into this Bill and to use, as the simplest form of continuation, the designation which had previously been used.
The Earl of Selkirk: What really is the difference? I found it very difficult to understand what was meant by a special road. It is referred to rather obliquely throughout the Bill. It means nothing to me except traffic control. Is there any distinctive difference between a special road and any other road, or is it simply a question of the continuation of a name because it is simpler?
Lord Mackay of Clashfern: The situation is that up to the time of this Bill the special road was provided under the Special Roads Act 1949. Motorways are the principal examples but not the only examples of roads which might he constructed under these powers. A feature of the roads which have been referred to is that you can lay down the classes of traffic which may use them. Pedestrians can be excluded, for example. The other important point is that the public utilities street works code does not apply. Therefore, there is a much stronger right for the road authority to prevent the road being dug up for the sake of public utilities. These are the features of the special road, and that legislation

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has been in place since 1949. The intention of the Bill is to bring together the legislation. We are not making changes for change's sake. We are trying to make it as simple as possible, but that is a special category of road which has proved its usefulness and we regard it as being important to continue that feature.
The Earl of Selkirk: Then are the rules for a special road different from those for "M" roads? Then, are special roads marked as such? Personally I have never seen such marking.
Lord Mackay of Clashfern: My noble friend has misunderstood, and I am sure that is my fault. An "M" road is simply one class of special road. The main example of a special road is what has been called a motorway. Motorways were constructed under the Special Roads Act's powers and they are the principal examples. The special roads on which the noble Lord will have travelled will almost all have been motorways. But the Edinburgh outer by-pass is another example. Strictly speaking, it is not a motorway and it does not conform with all that is required of a road to be classified as a motorway. But it is a special road. It has the features that the traffic on it is restricted to particular classes and that the public utility street works code does not apply to it.
The Earl of Selkirk: That means that the rules for the traffic are precisely the same?
Lord Mackay of Clashfern: That is true so far as the traffic's use of the road is concerned but the traffic which may use the road can vary according to what the Secretary of State thinks appropriate.
Lord Drumalbyn: I think I have understood that, but would it not be possible to take this opportunity to bring in something that the public could understand without an explanation as to what is an "M" road that is not a special road? One does come across examples of where an "M" road ceases to be an "M" road, and it is not quite clear what happens then and what the difference is; whether a cyclist can use it or not. I know that there are general notices to indicate whether cyclists or motor-cyclists can use the roads, but have we not gone long enough now to have a special classification for a special road that is not a motorway?
Lord Mackay of Clashfern: The number of these roads is sufficiently small to make it unwise to make more numerous statutory provisions than are necessary. So far as road construction is concerned and special provisions of that kind, there is no distinction between a special road and a motorway from the point of view of relevance under this legislation. So far as I can judge, what we have done is the most appropriate action in the circumstances, and I hope that my noble friend is able to agree with that explanation.
Lord Carmichael of Kelvingrove: Although I am greatly in sympathy with the noble Lords who have spoken and who hope that the name could be changed to "motorway", which seems the intelligent thing to do, I accept the argument of the noble and learned Lord the Lord Advocate. I can quote the example of
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the Glasgow ring road, because parts of it are not a motorway and are subject to different speed limits and other regulations. While the public may continue to call them all motorways, I can see the necessity for the legal formula in the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 46:
Page 8, line 16, leave out subsection (4).
The noble Lord said: The main purpose of this amendment is to try to ascertain exactly who else but a local authority could be a special road authority, unless this is a throwback to the days when roads—particularly those in the south—were built by agencies in the form of road construction units as against the old local authority. Other than that, I find it difficult to understand how else a special road authority could be anything other than the local authority for the particular area through which the road passes. There may, of course, be a handover period during which the Secretary of State himself may be involved before the road is ultimately handed over to the different local authorities who are responsible for each section of it. I may have all this wrong but this seems to be a slightly confusing subsection and I hope that the noble and learned Lord can help me with it.
Lord Mackay of Clashfern: This is just to provide the definition of the special roads authority as being the roads authority responsible for these particular special roads. It may be the local roads authority, or it may be the Secretary of State. In the case of the motorways, it is the Secretary of State, because sometimes local authorities act as agents for him in a particular area—indeed, very often they do. But the roads authority for most of the motorways—indeed, I believe all the motorways—is the Secretary of State. That is the reason for this subsection.
Lord Carmichael of Kelvingrove: I thank the noble and learned Lord the Lord Advocate for that explanation, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove had given notice of his intention to move Amendment No. 47:
Page 9, line 23, leave out first ("special").
The noble Lord said: It may be for the convenience of the committee to consider Amendments Nos. 47, 48, 49 and 50 together.
Amendment No. 48:
Page 9, line 25, leave out ("special")
Amendment No. 49:
Page 9, line 26, after ("the") insert ("special")
Amendment No. 50:
Page 9, line 29, leave out ("special")
However, after the explanations given by the noble and learned Lord the Lord Advocate on an earlier amendment,. I propose not to move those amendments.
[Amendments Nos. 47 to 50 not moved.]
Clause 7 agreed to.
Clauses 8 to 10 agreed to.
Clause 11 [Classification of roads]:
8.36 p.m.
On Question, Whether Clause 11 shall stand part of the Bill?
Lord Hughes: In clause 11 on page 12 of the Bill, subsection (1) makes reference to a "principal road". In clause 68 there is a reference to a "main road". But I cannot find in all these descriptions of roads in the interpretation clause any statement as to what a principal road is or what a main road is. It may read very simply, but if one does not know what a principal road is, it does not make much sense. It would seem to me that Clause 11 as it stands would be perfectly acceptable if there was a definition somewhere of what a "principal road" is. Similarly, there is the description of a "main road" in Clause 68 which I could not find defined anywhere, either. I do not guarantee that those are the only two places where these words occur; having found one of each, I thought that was enough to go on with.
Lord Mackay of Clashfern: The purpose of this clause is to give the Secretary of State power to classify a road as, among other things, a principal road. I am not sure that anything more is required. It is for the Secretary of State to decide whether he calls a road a principal road. The classification is that which the Secretary of State decides should be assigned to the road. The purpose of the clause is to give proper power to make such classification both in relation of the provisions of this Bill and to those of any other enactment which refers to a road classified by the Secretary of State.
Lord Hughes: On that basis, may I ask the noble and learned Lord what is the difference between a principal road and a main road? On page 42 there is a reference to a "main road". It may be all very well for the Secretary of State if he is the only person in Scotland who knows what a principal road is and if he is also the only one who knows what a main road is—but some of the rest of us would like to be as well informed on that matter.
Lord Mackay of Clashfern: I think the distinction is that the "principal road" is a type of classification, and if the Secretary of State exercises his power to classify it as a principal road it will be that for the Secretary of State and for all of us.
So far as a "main road" is concerned, I think that is intended not as a classification of the road. That is a description of a particular function that the road possesses, and of course if a road is a main road in an important sense the Secretary of State may decide to classify it as a "principal road". This clause is for classification, and that is the reason that it is in these terms.
Lord Drumalbyn: Will the Secretary of State automatically be liable to maintain it if it is a principal road; or who will?
Lord Mackay of Clashfern: One of the consequences of classification may be the way in which the road falls to be maintained. That is one of
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the reasons why there is a provision for classification, and different classes of grants may arise according to whether the road is classified in a particuar way.
The Earl of Selkirk: May I as: does this make any difference to motorists or road users? Is there any need to mark it to distinguish it as a principal road, or do you behave in exactly the same way as you would on any other road?
Lord Mackay of Clashfern: Like most of the provisions of this Bill, the main function is to regulate the provision of the road rather than the traffic on the road. The Road Traffic Regulation Act is the one that deals with the use of the road by traffic. The principle purpose of this legislation is to deal with the construction, the financial arrangements for the construction and for the maintenance and so on.
Lord Hughes: On page 91 we have a definition of "private road". It is a beauty. It says:
"'private road' means any road other than a public road".
We have a definition of "public road". It means
"a road which a roads authority have a duty to maintain".
Then we have a definition of "road":
"'road' means, subject to subsection (3) below, any way (other than a waterway) over which there is a public right of passage (by whatever means) and includes the road's verge, and any bridge (whether permanent or temporary) over which, or tunnel through which, the road passes; and any reference to a road includes a part thereof and a proposed road".
I think you are taking a "proposed road" out later on. It would not seem to me to be harmful if we had a definition of what a "principal road" is, if the Secretary of State decides that there should be such a thing, and that we should also have a definition of a "main road". If it is undesirable to define "principal" and "main" road, cannot it be defined in one of the other terms found suitable in other parts of the Bill? Why should it not just be a "private" road or a "public" road as the case may be?
Lord Mackay of Clashfern: I sought to explain that. The distinction between a public road and private road is that the public authority has a duty to maintain the public road. Any other public right of way is a private road. This clause is dealing with the classification of roads, which is a different matter and may have a bearing on the financial arrangements made between the Secretary of State himself and local authorities for the maintenance of the road. It is not a distinction of the same kind as the distinction between "public" and "private".
I find it hard to see how the Secretary of State could do more than just say that a particular road is classified as a "principal" road. The purpose of this clause is to give him that power. If it would help, I am sure one could add the definition that a "principal road" is one designated as such by the Secretary of State under Clause 11. But I doubt, with great respect, whether that is necessary.
Lord Hughes: Well, again I come back to Clause 68—the stopping up provisions. It says:
"to stop up any private means of access to land or premises adjoining or adjacent to land comprised in the route of the special, or as the case may be main, road".

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This seems to be saying, on the one hand, a special road and, on the other hand, everything else is a main road. Two terms are used, and the thing that first occurred to me was what is the difference between a "principal road" and a "main road". If there is a difference between them, what is the difference? If there is no difference between them, why cannot they be described by the same term?
Lord Mackay of Clashfern: The answer is that a main road may be a principal road if it is classified as such by the Secretary of State. So far as I can see, the principal function of that classification is to affect the burden of maintenance. The Secretary of State may pay different grants in respect of different classifications of roads, and this clause gives him the power that enables him to do that. It is a different type of distinction from the other distinctions to which the noble Lord has referred.
Lord Hughes: Well, this will be my last shot. I know that very often when one seeks to elaborate on the language used we are told that the more you define the more you endanger the general principle. But when you have these various definitions of roads which at first glance would cover everything, and then you have two other adjectives applied which are not interpreted in any way, I would suspect there is a possible case where somebody goes to the court and says, "I am not covered"; when the judges have to look at the Bill there is nothing in it to help them to say what is a "main road" and what is a "principal road". From what the noble Lord the Lord Advocate has said, it would appear to be perfectly possible to define these roads in such a way as to remove any doubt.
Obviously one of the things we want to do at the present time, in view of the mass of litigation that takes place, is to cut down any possibility of creating new sources of it. I would be content to leave it if the Lord Advocate would agree to have a look at the matter and see if it can be defined without removing one set of problems and creating another.
Lord Mackay of Clashfern: Certainly I will look at it. I have sought to explain the situation. But I will read what the noble Lord has said and look at it again in the light of that.
Clause 11 agreed to.
Clause 12 agreed to.
Clause 13 [Making up and maintenance of private roads]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 51:
Page 14, line 9, leave out ("paving, lighting or drainage") and insert ("or paving").
The noble Lord said: This again is an amendment seeking the guidance of the noble and learned Lord the Lord Advocate. The question I would like to ask him is, under what circumstances a local authority may be liable to install lighting and drainage for a private road,
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which one would assume would have been built—at least the drainage would—as a necessity during construction? The lighting would be something that would be decided by the local auhority later, because they would in any case require in a populous area to provide lighting. It would appear that these words would be superfluous. Either it would need to be provided automatically or it would be provided in the course of the original construction work. I would be pleased if the Lord Advocate would clarify this. I beg to move.
Lord Mackay of Clashfern: This clause is designed to deal with the situation in which the authority is faced with a private road and in which there is a question of making it into a public road. The general situation is that under Clause 13(1) the local roads authority may by notice to the frontagers of a private road require them to make it up and to maintain it at such reasonable standard as may be specified in the notice. There are provisions about appeals.
That is the basic idea: the local roads authority may require the people whose road it is to do this. It is a private road with a public right of way over it; the ownership is private, the resonsibility for maintenance is private. There is a right of way. The local authority may require that road to be made up to a reasonable standard. We say in the Bill that "reasonable standard" may include lighting or drainage. There are some circumstances in which it might be unreasonable to require the road to be lit, but there are other circumstances in which it would be reasonable to require it to be lit or drained. If the noble Lord's amendment is accepted the local authority would be unable to require lighting or drainage to be incorporated in the road. I think the noble Lord will be the first to realise that in some circumstances it would be most unfortunate to have a road, as he envisaged, in a populous area without the authority being able to require that it be lit. I hope that in the light of that explanation the noble Lord will feel able to withdraw the amendment.
My understanding is that "drainage" is covered in existing legislation. I think we have changed the word and that "channelling" was the word used in the Burgh Police Acts. But "lighting" has been added in the light of the Government's acceptance of the recommendations made by the Committee chaired by my noble friend Lord Stodart of Leaston that lighting in some circumstances may be desirable and that local roads authorities should have the power to require lighting.
8.50 p.m.
Lord Carmichael of Kelvingrove: I thank the Lord Advocate for that explanation and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 52 not moved.]
Lord Hughes Lord Hughes moved Amendment No. 53:
[Printed earlier: col. 683.]
The noble Lord said: Clause 13(8) contains the definition of "frontager" and I believe I spoke to this on Second Reading. I draw attention to Clause 15(2) which states that "frontager" has the same meaning as that in Clause 13(8). Moving on to Clause 20, this

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includes in subsection (2)(b)(i) that notice be intimated to,
"the owners of all lands and heritages which would front, abut or be comprehended in".
In this case the Lord Advocate explained to me what was meant by "comprehended in" and I do not object to that particular phrase being there. But I have Amendment No. 134 where I propose the inclusion in the interpretation clause the definition:
"("frontager' in relation to a road means the owner of any lands and heritages fronting or abutting or comprehended in that road;')".
Therefore, it takes in to the interpretation clause the various descriptions which are used throughout the Bill. If that can be accepted it would avoid the very undesirable practice of having definitions at different parts of the Bill. Amendment No. 53 would take out subsection (8) and the reference in Clause 15(2). The language in the Bill would otherwise not be altered. The different meanings that are attributed would be related to the definition of "frontager" in the interpretation clause. I beg to move.
Lord Mackay of Clashfern: I am obliged for that clear explanation. My way of looking at this is that I think the word "frontager" appears only in Clauses 13 and 15. In that situation—and it is a matter of judgment—it is not usual to have it in the interpretation clause unless the word occurs more often. It is a perfectly acceptable practice, where a word is used only sparingly, to put the interpretation in close proximity to it.
On the second point where this arises, in Clause 20, "frontager" has a different meaning. It is not right to say that it is the same, because "frontager" in the case of the actual road is as described in Clause 13(8), which is the subject of the amendment, but where there is not yet a road it is not quite the same thing. One is not "fronting" or "abutting" on a road but "fronting" or "abutting" or "comprehended in" a place which may ultimately be a road. There is a difference.
The noble Lord proposed a definition of "frontager", but his definition does not apply in the sense that it includes all the various possibilities. Stricly speaking, the meaning of the word "frontager" is not quite the same where there is a road and where there is not yet a road. I feel that it is necessary as a matter of proper drafting to have a different definition where the as yet unformed road is concerned. I hope that in the light of those explanations the noble Lord will feel able to withdraw his amendment.
May I take it, to avoid repetition, that any matter raised by the noble Lord, or any other noble Lord, will be considered by me to see whether any improvement can be made before the next stage. That applies to this amendment. However, as at present advised it seems to me that what we have in the Bill is perhaps marginally better than what is proposed.
Lord Hughes:In the light of what the Lord Advocate has said, I accept that there is some justification for leaving Clause 20 as it stands because it relates to the possibility of a road which might not come into existence. While he is quite correct in the references in Clauses 13 and 15—those are the only places with a reference to "frontager"—there are other
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parts which refer to "fronting" or "abutting". If one defines "frontager" in the way that I suggest, and leaving out the part about being "comprehended in", by the same token one is making perfectly clear what is meant by "fronting" or "abutting". So although the term "frontager" is not used, a definition of it including lands and heritages which front or abut, makes it perfectly clear what "fronting" or "abutting" in the other clauses mean.
Therefore, I shall ask leave to withdraw the amendment. However, it will be on the basis that at the next stage I shall come back to the matter but leaving out the phrase "comprehended in". I think it is generally agreed that if one can find all the definitions in one place it is very much easier, because the definition which is the easiest to lose is the one contained somewhere else in the Bill. On that basis I beg leave to withdraw the amendment. I shall not be moving the others which hang on it but will resubmit them in diminished form at the next stage.
Amendment, by leave, withdrawn.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 54:
Page 15, line 3, leave out ("Secretary of State") and insert ("sheriff").
The noble Lord said: In moving Amendment No. 54, it may be for the convenience of the Committee if Amendment No. 55 is discussed at the same time.
Amendment No. 55: Page 15, line 5, leave out ("Secretary of State's") and insert ("sheriff's").
This is a simple amendment suggesting that to ask the Secretary of State to adjudicate on a subject such as the making up of a private road is using a sledgehammer to crack a nut. In the belief that the Secretary of State is, or at least should be, a very busy man, we feel that, as there are many more of them, the sheriffs should be able to stand in and make the decision. We ask that "sheriff" be substituted for "Secretary of State". The same applies in both amendments. I beg to move.
Lord Mackay of Clashfern: The existing legislation dealing with this point allows an appeal to the sheriff. It was a fairly narrow balance as to whether "sheriff" should be left, or whether "Secretary of State" should be substituted. The view was taken that if the Secretary of State was the appellate tribunal, it might lead to greater uniformity. The balance is extremely narrow. In view of the argument put forward by the noble Lord, Lord Carmichael of Kelvingrove, and the feeling that he has expressed on the matter, I feel disposed to accept this amendment and the following one.
Lord Drumalbyn: I wish to express my satisfaction with that decision, which I am sure is the right one. I am sure that this is a local matter.
On Question, amendment agreed to.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 55:
[Printed earlier.]
On Question, amendment agreed to.
9.1 p.m.
On Question, Whether Clause 13, as amended, shall stand part of the Bill?
Lord Hughes: I have a question. On page 14, subsection (3) (b) states:
"a scheme whereby the cost is to be apportioned among the frontagers (being a scheme which is equitable in the opinion of the authority and which describes for each frontager the proportion of cost to be paid by him)".
On the previous two amendments the Lord Advocate said that one of the reasons for "Secretary of State" was that it was desirable to have uniformity, but as the issue was finely balanced he was content with "sheriff". I wish to ask about the question of uniformity.
Costs could be apportioned in a variety of ways. A fairly common way is to take the length of frontage and total cost, and if one man has 30 feet out of 1,000 feet he pays 30 one-thousandths of the cost of the road. Another way is simply on the number of the houses, when each house pays its share. That method is not commonly used; it could he very unfair. One person may have an enormous house with a frontage of 150 feet, and the man next door may have a little cottage with only 25 feet of frontage. There is no reason why they should pay the same. I do not think that is a starter. Another fairly common method is on the basis of rate able or equivalent value. But the most frequently used method is on the length of frontage, and that will probably continue.
If the matter is left to the discretion of authorities and no guidance of any sort is given, people in one area might feel hard done by if they learn that in another area a different method has been used and on that basis they would have been better off. People always look for comparisons to their advantage and not to their disadvantage. I do not think it is possible to state in the Bill the method of apportionment so that every authority works on the same basis, but I should like the Lord Advocate to consider this. It is common, after a Bill becomes an Act, for administrative guidance to be given to authorities on how to act. I should be content if these two methods, street frontage and rateable value, were referred to, perhaps going so far as to recommend—but not taking the discretion away from local authorities—that the fairest method is street frontage.
I do not expect the Lord Advocate now to say, "Yes, administrative guidance will be given". It is not his department that will be handling it; it will be the Secretary of State. But I hope that thought can be given to that. It would create a better sense of fairness as between one authority and another if as far as possible they apportioned on the same basis. Having said that, I am content that the clause should stand as it is.
Lord Drumalbyn: I wish to make two observations on what the noble Lord, Lord Hughes, says. If guidance were given by the Secretary of State, how easy or difficult would it be for the sheriff to interpret that guidance? How would he find out from other areas what the norm was? Would it make sense for the Secretary of State in a matter of this kind to consult the convention and get a consensus? I should have thought
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that was a good idea. It would not bind the local authority to a particular decision in a particular case, bearing in mind the variations in the circumstances. That seems the sensible approach, and in the end to leave the decision to the sheriff.
Lord Hughes: I do not see where the noble Lord, Lord Drumalbyn, gets his reference to the sheriff. Unless I have missed it, I do not think that there is any appeal against the apportionment. The sheriff would not come into the matter.
Lord Mackay of Clashfern: The appeal provision is in relation to the notice which is served under subsection (1); that is, the appeal provision in subsection (9). Subsection (3) states that the notice shall,
"without prejudice to the generality…specify".
the scheme, among other things. The basis of the apportionment is a matter on which the frontager may appeal to the sheriff. That is one reason why, as I said, we thought that possibly the Secretary of State was the best person to whom to appeal, but in the circumstances your Lordships felt differently.
The best that we can do is to emphasise equity. It is a scheme which is to be "equitable" in the circumstances. Certainly the Secretary of State will consider what is being said, but I would hope that among themselves local authorities would be able to Arrange generally what they thought was an equitable way of doing this. Indeed, the noble Lord, Lord Huges, says that in his experience one method is pretty common as it is.
Lord Hughes: Yes, I agree. Whatever method is adopted will be equitable in the area in which it applies. But what I was concerned about was that if different methods were adopted, some people would say, "This isn't equitable. They have done it the wrong way. I am paying an awful lot more than I should have done, because in the adjoining region they have done it another way and on that basis I would have been paying X pounds rather than what I am paying". So I think that there is a point to consider here.
I rather like the suggestion of the noble Lord, Lord Drumalbyn. Perhaps the convention can discuss the matter and agree what is to be the preferred method, but with an alternative method in exceptional circumstances. I think that that is the most that can be expected. If that were done, and if every attempt were made to achieve the greatest degree of uniformity, it would certainly diminish any grievance which an individual might have that he had not been dealt with under the other method. If when the Bill becomes law the Scottish Office ensures that this is one of the matters to be discussed with the convention, that will certainly meet my point.
Clause 13, as amended, agreed to.
Clauses 14 and 15 agreed to.
Clause 16 [Security for private road works relating to housing]:
The Deputy Chairman of Committees (Lord Hayter): I am instructed that if Amendment No. 56 is agreed to, I cannot call Amendment No. 57
9.10 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 56:
Page 16, line 11, leave out from ("obtained") to end of clause.
The noble Lord said: This amendment is meaningless unless we take with it Amendment No. 57:
Page 16, line 12, leave out paragraph (b).
The purpose here is to elicit from the Government as much information as is possible on the question of what has become popularly known as the road bond that will be required before builders commence a new development. The Scottish Housebuilders' Association is particularly concerned about this matter, and at another level the population in general is concerned because it increases the cost of the house to the ordinary buyer. Nowadays in many cases this applies in particular to the first-time buyer, who in the initial stages is looking for as low a cost as possible. While the Scottish Housebuilders' Association wishes to have the cost reduced as a selling point, we wish to have it reduced principally because it is an unnecessary additional cost to the purchaser in which he should not need to become involved owing to any mistakes which we might have made in this House or in another place.
So we are concerned to ensure that the cost of providing the bond is kept to the absolute minimum. The belief is that this could be achieved by ensuring that the bond is not required prematurely, and, further, that it is released at the earliest opportunity once the roads have been satisfactorily completed. In this connection there is concern that in certain cases local authorities might use delaying tactics, though I do not think that my own local authority or that of my noble friend Lord Hughes could be accused of that. Therefore, Clause 16(4), which enables the local authority, the builder, or anyone involved in a dispute, to refer the matter to an arbiter is of vital importance.
It is important that we straighten out such questions as the date from which a bond should be required. I believe that in Scottish law at any rate no purchaser is at risk until a missive has been signed and work on the dwelling house has commenced, or perhaps in many cases work has actually been completed. Clause 16(2) states that the erection or alteration shall not commence until a bond has been obtained. It is not clear that that concerns only work on the dwelling house itself, and it may be interpreted that the bond is required even before the road work commences.
I am slightly nervous about the whole question, since I recall that when I was much younger, when many private housing estates were built between the wars, the roads were not made up until many years afterwards. There were one or two cases in which occupiers were left to fill in the roads, and there were appalling conditions. Bottoming was impossible, and tons of stuff were thrown in so as to form a surface.
I understand that a working party involving the department and the builders is active in this matter. That is good. The date of the bond is important. It is necessary that there should not merely be an assurance but some sort of statutory assurance that the bond will be surrendered to the builder and therefore, at second-hand, to the owner. We hope that the savings will be passed on to the new mortgagor as quickly as possible.
This is largely a probing amendment. I recognise that there is a long way to go. The best course, following what the Lord Advocate has to say, may be to discuss the matter again on Report. I would, however, be pleased to know whether the Lord Advocate can give some idea of how he proposes to tackle what is an extremely difficult and thorny problem.
Lord Mackay of Clashfern: The noble Lord, Lord Carmichael, has explained that the purpose of the amendment is not really to delete this part of the Bill but to inquire into our more detailed thinking about it. As the noble Lord said, a power of this kind is extremely important in order to prevent the kind of serious difficulty to which he referred where people have purchased houses and are possibly living in the houses but the roads are never made up, even when there is an obligation in the missive to make them up, because the developer has gone bankrupt or something else of that nature has happened. That is a serious risk. These provisions are intended to provide for regulations whereby the risk may be obviated.
The details of the regulations, as the noble Lord said, are being considered by the Scottish Office in discussion with house builders, COSLA, building societies and others. The work on the detailed regulations will continue. I can assure the noble Lord that the Secretary of State wishes to make regulations that secure that the kind of difficulty to which he has referred does not arise, making the minimum of interference with what otherwise would go on; in other words, he will do his best to secure that the regulations are as free as possible from any unnecessary burden on the developers or the house buyers. The idea is to secure for the house buyers what they need in the way of road construction—that and nothing more. The points that the noble Lord has made will be taken fully into account in framing the detailed regulations.
Lord Carmichael of Kelvingrove: I am grateful to the Lord Advocate for his explanation, knowing that he will do what he can to try to meet the points that I have raised. They were raised with me by local authorities and by the building industry in Scotland. On the promise that he will look at the matter, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 57 not moved.]
On Question, Whether Clause 16 shall stand part of the Bill?
Lord Hughes: Subsection (3)(b) deals with the consequences of committing an offence and states,
"is liable on summary conviction to a fine not exceeding the statutory maximum and on conviction on indictment to a fine".
I think that I am right in assuming that where the subsection mentions a fine, it is without a limit being fixed. However, in Clause 21, dealing with offences in relation to the construction of new roads, the terms used are a person who,
"commits an offence, which shall be triable either summarily or on indictment".
So far as I can see, this would accomplish the same end as the language used in Clause 16—up to the statutory maximum or, on indictment, to an unlimited

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fine. Why, in these two clauses, are the references to the penalties attaching to the committing of an offence, described in these different ways? Would it not be desirable that either one or the other should stand in both cases?
Lord Mackay of Clashfern: I think the situation is that the provision to which the noble Lord has referred in Clause 16 is one that does define the penalty. The provision in Clause 21 does not fully define the penalty. It only makes available the two modes of trial, either summarily or on indictment. Then, the situation is provided for in Schedule 7, under the head, "Penalties for Offences", that, on summary conviction, it will be the statutory maximum, and upon conviction on indictment, a fine. So the extra words that he is looking for so far as Clause 21 is concerned are provided by Schedule 7. There might be something to be said for doing the same so far as the clause which we have just been looking at is concerned, and I shall certainly be happy to consider that.
Lord Hughes: From the way in which the noble and learned Lord has explained what would happen under Clause 21 we are brought back to the wording where the maximum would be the maximum statutory penalty and on indictment an unlimited fine. I think that there is merit in using them both. Incidentally, is there such a word as "triable"?
Lord Mackay of Clashfern: I am certainly under the strong impression that there is such a word, and your Lordships House has certainly passed a considerable amount of legislation in which that word has been used. If it did not exist before, it certainly exists by now.
Clause 16 agreed to.
Clause 17 [Power of local roads authority to take over footpaths associated with development]:
[Amendment No. 58 not moved.]
Clause 17 agreed to.
Clause 18 [Construction of new roads by Secretary of State as roads authority]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove had given notice of his intention to move Amendment No. 59:
Page 18, line 12, leave out subsection (3).
The noble Lord said: I think the noble and learned Lord the Lord Advocate has already dealt fully with the special roads, and, therefore, I shall not move this amendment.
[Amendment No. 59 not moved.]
Clause 18 agreed to.
Clause 19 [Construction of new roads by local roads authority]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 60:
Page 18, line 16, leave out ("requisite") and insert ("necessary").
The noble Lord said: This is one of those amendments to which we are becoming accustomed. It is to leave out "requisite" and insert "necessary". It seems that "requisite" is unnecessary in the context of the Bill, and unless there is some very obscure legal requirement I cannot see the reason for using a word that is slightly less common, in the circles in which I move, than the word "necessary". I beg to move.
Lord Mackay of Clashfern: The word "requisite" is the word that has been chosen. I think it is a common word. It may not be quite so common in the circles in which the noble Lord moves as the word "necessary", but it is a perfectly common word, and is well understood. The fact is—and this is the second reason—it is the word which has been used in the corresponding section of the Roads and Bridges (Scotland) Act since 1878. I could well see that if the noble Lord was drafting the Bill he might have chosen "necessary" and I would not feel able to press for "requisite" as an alternative. But having chosen "requisite", perhaps the noble Lord will allow us to retain it.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees: The next amendment is No. 61. I have to point out that, as printed in the Marshalled List, in the penultimate line, after the words "the local roads", the word "authority" should be added.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 61:
Leave out Clause 19 and insert the following new clause:
Construction of new roads other than special roads by local roads authority; and entry of such new roads and of special roads in list of public roads.
("19.—

(1) Without prejudice to section 7(3) and (5)(a) of this Act, a local roads authority may construct in their area any new road, other than a special road, which they consider requisite.

(2) When such construction by them as is mentioned in subsection (1) above or in the said section 7(5)(a) is completed, the local roads authority shall enter the road (or as the case may be special road) in their list of public roads.

")
The noble and learned Lord said: I am obliged to the Lord Chairman for pointing that out.
This is a rewrite of the existing Clause 19 to make it clear that, in the same way as special roads are excluded from the Secretary of State's powers to construct roads under Clause 18, so it is necessary to exclude special roads from local roads authorities' powers to construct roads under Clause 19. So this corresponds to the one to which we looked a minute or two ago. I beg to move.
On Question, amendment agreed to.
Clause 20 [Requirement of consent for new roads built other than by roads authority]:
Lord Hughes Lord Hughes had given notice of his intention to move Amendment No. 62:
Page 18, line 28, leave out from ("the") to ("in") in line 29 and Insert ("frontagers")
The noble Lord said: This amendment was covered

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by points we have discussed and which the Lord Advocate and I shall be considering. I do not wish to move the amendment at this stage.
[Amendment No. 62 not moved.]
9.26 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 63:
Page 19, line 5, leave out from ("heard") to end of line 6.
The noble Lord said: Whenever I see this phrase "by them as regards his application" I always think of a famous series in Private Eye. It seems quite superfluous when we are really considering that "the authority shall allow the person applying for the consent an opportunity to be heard". I am sure he would be ruled out if he tried to speak about anything else other than the subject for which he had asked to be heard, which is about his application. It is a small point, but one of the little points that make the law more wordy and terrifying for people like me who have occasionally to read it. I hope that the Lord Advocate will make what is a minor but a helpful concession. I beg to move.
Lord Mackay of Clashfern: We are anxious naturally to reduce the volume of the legislation consistent with clarity. But it is important that the right to be heard is a right to be heard by the roads authority and nobody else—not a deputation or an official of the roads authority. It is a right to be heard by the roads authority, and I regard that as important. The fact that the Bill says, "as regards his application" is possibly wise having regard to how far in advance the phrase is used.
If the noble Lord feels able to accept that, I should be happy. Obviously how far one has to go to obtain precision is a matter of judgment. I have discussed this amendment with the draftsman because I had sympathy with the noble Lord's desire to shorten the subsection. I thought possibly the words "as regards his application" might be deleted. Having considered it carefully with the draftsman, I think it is better to have the phrase in. But the words, "by them" are important, so I hope in the light of this explanation that the noble Lord will feel able to withdraw the amendment.
Lord Carmichael of Kelvingrove: I thank the Lord Advocate for that explanation. I agree that the amendment would have been better had it been only to delete "as regards his application". "By them" is rather important. I still feel that "as regards his application" is superfluous and almost lumber. It is not a point that is worth taking any further. With the hope that the Lord Advocate will feel able to do a little tidying up and to make a few concessions by the next stage of the Bill, I would beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 64:
Page 19, line 21, after second ("the") insert ("local").
The noble and learned Lord said: This is a drafting amendment to make it clear that it is a local roads authority, because construction consent applications are made only to local roads authorities, and for accuracy it is better that we should put this in. I beg to move.
On Question, amendment agreed to.
Clause 20, as amended, agreed to.
Clause 21 agreed to.
Clause 22 [Power to stop up or temporarily close new road where construction consent absent or not conformed with]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 65:
Page 19, line 39, after ("person") insert ("(other than a roads authority)").
The noble Lord said: This amendment is necessary to make it clear that the local roads authority's powers in Clause 22 cannot be exercised in relation to a road built by the Secretary of State who, as a roads authority himself, does not require construction consent. It makes Clause 22 consistent with Clause 20. I beg to move.
On Question, amendment agreed to.
Clause 22, as amended, agreed to.
Clause 23 [Alterations of levels of public roads]:
9.31 p.m.
Lord Hughes Lord Hughes moved Amendment No. 66:
Page 20, line 13, leave out ("raise or lower or otherwise").
The noble Lord said: The heading before Clause 23 concerns "levels". The clause says:
"Subject to any order under section 9 or 12 of this Act, the roads authority may raise or lower or otherwise alter, as they think fit, the level of a public road".
My amendment seeks to leave out everything after the word "alter". I think that covers everything. I cannot think of much that can be done to alter the level of a road other than by raising it or lowering it, although it was pointed out at an earlier stage that the alteration might include doing both. It may be raised at one point and lowered at another. That happens often, if one takes the opportunity to eliminate unnecessary rises in a road, it may be accomplished by filling up the adjoining bit as well. However, that would be altering the road. This is part of the campaign upon which we are unashamedly embarking. We shall continue to try to cut out unnecessary language. The next stage is to put it into readable English, but that is too big a hurdle to attempt at this time. I beg to move.
Lord Mackay of Clashfern: The purpose of the phrase which is attacked in the amendment is to make it clear that the clause includes powers to change the banking or camber of a road as well as raising or lowering the full level of the road as a whole. This is based on a modern provision, the Roads (Scotland) Act 1970. The danger is that if one misses this out at this stage comparison might be made with the previous fairly modern legislation and it might be thought that the intention was somewhat to restrict the power of the road authority.
Altering the camber of a road may be of critical, importance in some situations. If there was any doubt about the power of the authority to alter the camber or banking of a road that would be rather unsatisfactory. This is the sort of thing that is contemplated and I hope that the noble Lord will feel that his campaign may be well directed otherwise, but perhaps in this situation he may feel able to allow the words to stand.
Viscount Hanworth: Time and again—I think it was on another occasion about this time of night—we come to a conclusion that there was possibly something in a Bill which was unnecessary. But in the main we criticise Bills because they are not clear. We cannot have it both ways. If there is a certain redundancy and it might make it a little clearer we should leave the Bill alone. With the number of amendments we have to deal with, I do not think it is very profitable to raise this sort of amendment.
Lord Drumalbyn: I am sure that the Lord Advocate is absolutely right in leaving room to alter the camber
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of a road, but I wonder whether he has thought just how far the words,
"otherwise alter, as they think fit"
could go. We have had legislation about bumps in the road and things of that sort. I wonder whether we have got it quite right and have not made it possible for a local authority which has some unusual ideas to exploit them to the public detriment—not intentionally, of course.
Lord Mackay of Clashfern: This legislation has been in place for some time. These words, as I have said, were in the Roads (Scotland) Act 1970 and no such difficult consequences have arisen. It seems to me a reasonable provision and local authorities are given powers to use reasonably. The courts certainly would be prepared to curb unreasonable use of statutory powers.
Lord Hughes: When the noble and learned Lord was making his first reply, he gave as an example altering the camber of the road. I must stress the word "altering". If you alter the camber of a road, will that be included in a definition "altering the road"? Surely, no one could possibly say that altering the camber of a road was not altering the road. If in this Bill the banking is part of the road—because, if it is not, this would not apply even within the meaning of the word "otherwise"—then, if they change the banking, they are also altering the road.
I agree with the noble Lord who spoke from the Alliance Benches that if there is any doubt about the matter it is better to use more words to make it perfectly clear. That is a doctrine to which I would subscribe. But I do not subscribe to the doctrine that you put more words in where there is no necessity for elaboration. I fall back on what Ministers say so often, "The more you specify, the more you destroy the generality". I think that the word "alter" covers everything. If you raise the level of a road, you alter a road. If you lower the level of a road, you are altering it. If you both raise and lower it at different parts, you alter it. If you change the camber of a road, you are altering it. If you change the banking, if the banking is part of the road, you are altering the road. I ask the noble and learned Lord to give some more thought to this matter.
We have had sometimes some funny decisions from sheriffs who are no longer on the shrieval Bench, and I am not criticising any of the present occupants. But I doubt whether even the ones who have made the most peculiar decisions could argue that altering the camber of the road was not covered by legislation which allowed the local authority to alter the road. I am content to leave it that the noble and learned Lord the Lord Advocate will have another look at this aspect, provided that he lets me know whether he is going to do anything about it in time for the next stage of the Bill. This is not the first place where this sort of thing arises. If we cannot find a simpler way of dealing with the matter then I should be anxious to test the feeling of the Committee, but it would be ridiculous to do so tonight. If it is possible to reach agreement on the matter, so much the better.
The Earl of Selkirk: I am a little disturbed by what my noble and learned friend the Lord Advocate has said. This is a Bill which is said to,
"codify in modern terms provisions on the road".
That is to be found in the Explanatory Memorandum. If we are going to be tied by the words of former statutes then the words that I have just quoted will mean nothing. My noble and learned friend has said that because these words have appeared in previous statutes it is therefore out of place to alter them. I know that it is a late hour, and of course we can all go to bed and we all want to go to bed; I quite appreciate that. But I think it is a little bit hard to say that better words cannot be used because they differ from the words of previous statutes. That applies all through the Bill. We are trying to make the Bill a little better. I think that we should have a little more consideration from my noble and learned friend.
Lord Mackay of Clashfern: I am sorry that my noble friend feels he is not getting full consideration. I am giving the fullest consideration to every suggestion. The mere fact that something was in a previous Act does not in any way tie our hands, but where the choice between two sets of words is a very narrow one then I feel that the fact that it was in previous legislation is of some importance. It was in that light that I used that expression. This particular expression is used in what I said was a modern statute, the Roads (Scotland) Act 1970. The more modern the statute, the less necessary it is to change for the sake of modernisation; but we are engaged in the exercise of trying to simplify the whole of our roads legislation. It is quite a big task but I am not ruling out anything. I think I have made it clear that I will consider all matters that have been raised, and this is no exception.
Lord Drumalbyn: I could not help thinking, when the noble Lord opposite was arguing this case and kept leaving out the words "altering the level of the public road", that that is not the same as "altering the road". Altering the road would go very much further than that. But in spite of what I said earlier, I would strongly support what the noble and learned Lord the Lord Advocate has said.
Lord Hughes: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 67 not moved.]
Clause 23 agreed to.
Clause 24 [Provision of footways]:
9.42 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 68:
Page 20, line 18, after ("sufficient") insert ("footpaths or").
The noble Lord said: The purpose of this amendment is to make it more explicit that a roads authority shall provide,
"wherever it appears to them necessary or desirable for the safety or convenience of pedestrians so to do, proper and sufficient footpaths or footways for public roads.".
I am reinforced in moving this amendment by the fact that the Government Amendment No. 70 specifically
1010
mentions footway, footpath, cycle track and carriageway individually. So obviously, in the Government's interpretation of the terms of the Bill, a footpath and a footway are two different things. Therefore I hope that this is one amendment which the noble and learned Lord the Lord Advocate will be happy to accept as being a clarification of something that he has down later in Amendment No. 70. I beg to move.
Lord Mackay of Clashfern: This clause has its origins in the 1930 Road Traffic Act and is primarily aimed at pedestrian safety. A footway, as defined in Clause 143, is that element of a road which is associated with a carriageway and whose provision enables pedestrians to keep out of the way of traffic. Footpaths are places for pedestrians which are not associated with carriageways. While it is not appropriate to extend the duties of road authorities under this clause to footpaths, these authorities will still be able to construct footpaths where they consider them to be requisite under their powers in Clause 19 of the Bill. I would have thought, with great respect, that to insert "footpaths" here is inappropriate. "Footways" are the correct provision for pedestrians, in association with the public road.
Lord Carmichael of Kelvingrove: I understand the drift of what the noble and learned Lord has said. I wonder whether there is another part of the Bill—I think possibly there is—where they talk about cycle paths and cycle tracks, where there is a space between the road and the cycle track, and then presumably there would be another space between the cycle track and the footpath—or would it be a footway? And where would the difference be? I cannot see that a great deal would be lost by including "footpaths" as well as "footways". I am not very sure whether in Scottish nomenclature we normally say "footway" rather than "footpath". It is more normally "pavement", of course. I should have thought that the juxtaposition was wrong here; but we are splitting hairs.
I know that the Lord Advocate means a road over, perhaps, part of the meadows in Edinburgh, through Kelvingrove Park. A local authority would have power to provide that, yet it would not be a footway; it would be a footpath. It is not a big point, but the noble and learned Lord specifically spells it out in Amendment No. 70, and I understand his reasoning. It is not something about which we would willingly wish to go to the wall, but I hope that the noble and learned Lord will at least give it consideration before Report stage and see whether there is any possibility of accommodating this amendment.
Lord Mackay of Clashfern: Before the noble Lord says what he is going to do about this amendment, may I say that the important point is that we are talking about public roads, and a footpath, by definition—and we have tried to define these for consistency—is a place for pedestrians. It is, as it were, by itself, and is not associated with anything else. It is not appropriate to put it in here because it is not for a public road. In the case of a footpath, the footpath is the public road.
Lord Carmichael of Kelvingrove: I take the noble and learned Lord's point, and I will withdraw the amendment, but I will certainly give it some thought before the next stage of the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 24 agreed to.
Clauses 25 and 26 agreed to.
Clause 27 [Fences etc. to safeguard persons using public roads]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 69:
[Printed earlier: col. 652.]
The noble and learned Lord said: I spoke to this amendment and to No. 70 earlier. Amendment No. 69 is designed to make it easier to provide cycle tracks by making provision for either fences or barriers, and Amendment No. 70 provides for divisions between the various matters that are there specified. I beg to move.
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 70:
[Printed earlier: col. 652.]
On Question, amendment agreed to.
Clause 27, as amended. agreed to.
Clause 28 agreed to.
Clause 29 [Works for protecting roads against hazards of nature]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 71:
Page 21, line 32, at end insert ("in the road or in land adjoining or lying near to the road")
The noble Lord said: This, again, is an amendment which seeks to find out whether a local authority has power to go out with the contours of the road to build barriers or other works which are necessary to keep out snow or other obstructions. I do not know whether it is implicit in the Bill, but I think it is something which should be made explicit, because in certain areas a little part of the adjoining land lying near the road may be needed in order to protect the road itself. I should be pleased if we could have clarification on this point. Even if the amendment is acceptable, I am sure that the wording is not the best, but I hope that the Lord Advocate will take the amendment in the spirit in which it is proffered. I beg to move.
Lord Mackay of Clashfern: We are absolutely at one about what is wanted here. The only question is whether there should be some restriction on the distance from the road that one should go. What we have provided is that the roads authority should be allowed to go as far as may be necessary from the road to provide the necessary protection. For example, to provide effective protection from flooding or landslide, works may have to be carried out at a considerable
1012
distance from the road. It would be imprudent to restrict it to land adjoining or near to the road. We have tried, therefore, to make it as free as possible. I would point out in particular that Clause 106(3) excepts protective works from the distance limits applied by Schedule 5 to the Bill. We have sought to achieve exactly what the noble Lord is putting forward in this amendment without restricting it to being near the road. The local authority will be able to go as far from the road as is necessary to provide the necessary protective works.
Lord Carmichael of Kelvingrove: After that explanation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 29 agreed to.
Clause 30 [Drainage of roads]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 72:
Page 22, line 8, leave out subsection (2).
The noble Lord said: Again this is a subsection which appears to me to be unnecessary. It reads:
"Without prejudice to subsection (1)(c) above, where any drain referred to therein was constructed or laid by the roads authority, they shall scour, cleanse and keep it open".
My reading of the subsection is that this is implicit in the wording of subsection (1). Therefore, subsection (2) is superfluous. I hope that the noble and learned Lord the Lord Advocate will agree with me that subsection (2) is not required. I beg to move.
Lord Mackay of Clashfern: The earlier words are permissive, enabling a local authority to provide these various facilities. It is very important that the roads authority should have a duty to cleanse and keep open any road drains which are provided by them. The noble Lord's amendment would remove that duty. We regard that duty as important. Therefore, we feel that the provision should remain. This is the distinction between "permissive" and "mandatory" to which the noble Lord, Lord Hughes, has already referred. We are trying to make the position absolutely plain. We regard it as important to have both aspects in the clause.
Lord Drumalbyn: They have no duty unless they themselves have constructed or laid the roads.
Lord Mackay of Clashfern: That is so, under this clause.
Lord Drumalbyn: There is another reference under which they would have a duty, even though they had not laid or constructed the road.
Lord Makay of Clashfern: The situation is that the drains are to be provided by them as part of the road. Obviously they have the right to provide the road with its drainage up to the proper standard. The purpose of this clause is to impose upon the roads authority the duty to cleanse all the road drains that they have provided for the purpose of draining the roads.
Lord Hughes: If that is the case, and I accept the explanation which the noble and learned Lord the Lord Advocate has given, what is the meaning at the beginning of subsection (2) of the words:
"Without prejudice to subsection (1)(c) above …"?
If subsection (1)(c) is only a permissive power to scour, cleanse and keep open all drains in the road or in such land as aforesaid and if it is followed by a mandatory requirement that they should do so, it does a lot more than prejudice something. It knocks it out of the window.
Lord Mackay of Clashfern: With great respect, it does not in any way knock out our power to scour all sorts of drains; we then have a duty to scour our own drains. There is no conflict between the two.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hughes Lord Hughes moved Amendment No. 73:
Page 22, line 20, leave out paragraph (a) and insert—
("(a) if the roads authority is the Secretary of State he shall not carry out the proposed works without having considered the objection;").
The noble Lord said: The existing wording in the Bill is,
"(a) if the objection is to works proposed to be carried out by the Secretary of State, he shall consider the objection before carrying them out".
One could say that on a strict reading of that language, the Secretary of State receives the objection, considers it, but just goes ahead as he originally intended. I will now refer the Committee to Clause 75(4)(a) on page 48, which states,
"(a) if the roads authority is the Secretary of State, he shall not carry out the proposed works without having considered the objection".
That second form of words implies that the Secretary of State may not carry out the works he originally intended because he shall not do so without having considered any objection. My amendment proposes that instead of the words on page 22 of the Bill, we use those on page 48.
That second form of wording makes it quite clear that the Secretary of State should give due consideration to any objection and that he will not just carry on as if nothing had happened. In view of the way the words are used elsewhere, I am sure it is not intended that the Secretary of State should only pay lip service to consultations. I feel that the Government's second form of words is a better way of dealing with the matter. I beg to move.
Lord Mackay of Clashfern: I accept that there is a point here. The words proposed by the noble Lord, Lord Hughes, may not exactly fit this context either; but if he will leave this matter with me, we shall bring back an amendment at Report stage to cover this.
Lord Hughes: I am quite content with that and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 agreed to.
Clause 31 agreed to.
Clause 32 [Snow gates):
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No.74:
Page 23, line 11, leave out ("a precipitation or accumulation of").
The noble Lord said: This amendment questions whether it is necessary to include in the Bill the words:
"a precipitation or accumulation of".
We are all trying to cut out unnecessary verbiage in Bills and I hope that the noble and learned Lord will agree that the words,
"temporarily closing a road to vehicular traffic on any occasion when snow has rendered that road unsafe for such traffic"—
and this is very topical just now—are really sufficient without having to worry about,
"a precipitation or accumulation of snow".
Unless there is some great mystery, I hope that I can get the noble and learned Lord to accept the omission of those words.
Lord Mackay of Clashfern: There is a point here of some importance. It is desirable that the authority with the power to close these gates should have the power to do so not in relation only to a danger which has already been created but which that authority anticipates may arise in the immediate future. The clause as drafted is not very satisfactory and I am obliged to the noble Lord for moving this amendment as it has drawn my attention particulary to the drafting of the clause.
We should wish to reconsider this clause in the light of the amendment, but I should certainly want to try ultimately to produce a clause that has those two elements in it. Therefore, I am not absolutely happy with the rather simpler form of wording which the noble Lord proposes because I believe it is quite important that both aspects of the matter are considered when a decision to close is taken. One can appreciate that the decision to close a public road is quite an important one and we must be certain that all the considerations are properly set out. In the light of that, perhaps the noble Lord will withdraw his amendment and give me a chance to consider it in the future.
Lord Hughes: The noble and learned Lord has been very fair and I shall certainly look with great care at the words he puts down in place of those which appear in Clause 32(1). I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 32 agreed to.
Clause 33 [Clearance of snow and ice]:
10 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 75:
Page 23, line 24, after ("pedestrains") insert ("over footways and in pedestrian ways")
The noble Lord said: I have been asked about this aspect by a surprising number of people, and there have been notes in the press and letters to the newspapers recently. I am asking for information; I am sure the wording of the amendment would not be exactly what the Lord Advocate would accept, but even he would agree with the sentiment of it. What I am concerned about and the people who have approached me have been concerned about is what are the duties on the owners or tenants who are fronting the road as regards the footways or pedestrian ways in front of their premises during periods of heavy snow?
I am informed that there were many old byelaws or perhaps Burgh Police Acts which made it a duty to clear snow away from the front of shops and residences. This seems to have been neglected and is certainly very seldom done now, unless they are very energetic people who occupy the premises. This amendment is an effort to get clarification on what is a very topical subject: what obligations there are on owners or occupants of premises adjoining a road to clear the snow. I should be very pleased if the Lord Advocate could help me. Perhaps he could get the information and pass it to me at a later stage. I beg to move.
Lord Stodart of Leaston: I wonder whether I may put a point to my noble and learned friend. I apologise for my voice; it has an affliction not uncommon at this time of the year. I think the point I wish to raise does deal with the amendment which has been moved. The clause, as I undestand it, deals with preventing snow from endangering pedestrians and vehicles on public roads. Because of the definition of a footway—which I prefer to describe as a pavement—this covers the endangering of pedestrians on the pavement. In the committee which I chaired some two or three years ago we reported that a good deal of confusion had been expressed to us about the responsibility of keeping up public footpaths, as opposed to footways. To my mind, a footpath is probably what the noble Lord, Lord Carmichael, is describing as a pedestrian way, which does not, I have ascertained, feature in the interpretation clause; a footpath does but a pedestrian way does not.
My noble friend the Lord Advocate can probably well imagine a case in which there is a housing scheme or a housing development—it may be private or it may be public—through which there is a public road. If it had been a private road it might have been taken over by the road authority. But because the road happens to take a slightly circuitous route there may well be what I would describe as a short cut in the form of a footpath from the housing scheme or development leading to the main shopping centre which is used by pedestrians. That is, of course, a footpath.
So far as I have understood Clause 17,this is dealt with, to a certain extent, with the taking over of a public footpath by the roads authority, if it wants to. I put to my noble and learned friend that it would not be unreasonable, and would perhaps avoid confusion, if it were made clear in this clause, as we certainly thought it should be, that the kind of footpath I have described should be included in the responsibility of the roads authority so far as the clearing of snow and the endangering of pedestrians on it is concerned.
Lord Mackay of Clashfern: This clause as it stands provides that:
"A roads authority shall take such steps as they consider reasonable to prevent snow and ice endangering the safe passage of pedestrians over public roads".
Public roads includes everything that is under the responsibility of the roads authority to maintain, whether it be a footpath or a footway which is part of a public road, or otherwise.
The noble Lord's amendment would insert after "pedestrians" the phrase:
"over footways and in pedestrian ways".
That would be a little unfortunate because it would mean that in the road clearing responsibilities the authority would have to take no thought of the safety of pedestrians crossing the carriageway. In other words, this amendment is limiting the responsibility which the clause puts on the roads authority. Therefore, the clause is better as it is without the amendment.
As regards the observations of my noble friend Lord Stodart of Leaston, I think that the important matter is whether or not the footpath to which he refers is a footpath over which there is a public right of way. One may have a trodden path which people choose to tread down because it is a short cut, but unless it is a public right of way there will not be a responsibility to keep it clear. If people care to use a short cut when a provided road is a series of hairpin bends down a slope, minimising a slope that one has to negotiate, the person taking the short cut does so at his own risk. It would be very difficult to impose upon the roads authority an obligation to deal with anything that is not a public right of way. So long as it is a public right of way and a public road in the sense of this Bill, it will be covered.
The noble Lord did not so much speak to his amendment as ask me a question. My understanding of the position is that in the cities—I think in Aberdeen, Edinburgh, Glasgow and Greenock—local enactments provide that the frontagers have a responsibility for snow clearing. When this Bill comes into force, as I hope it will, those provisions will be superseded and it will be the roads authority which will have the obligation to do the snow clearing. Of course, it will be open to frontagers to do what they wish in the way of helping to clear away snow but it will be the roads authority that will have the obligation.
Lord Stodart of Leaston: I wish to ask my noble and learned friend for clarification. The heading of Clause 17 is:
"Power of local roads authority to take over footpaths associated with development".
Suppose that a roads authority comes to an agreement, takes over the footpath and therefore agrees to maintain it, will such a footpath be cleared of snow, even if it is not a right of way?
Lord Mackay of Clashfern: As I understand my noble friend's example, that sort of footpath will come within the obligation but it will also in the light of the example have a public right of way over it. When I say

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that the footpath will be cleared of snow, I should perhaps be careful to say that the authority has to,
"take such steps as they consider reasonable to prevent snow and ice endangering"
those who pass over it. That might not require complete clearance. It depends on the circumstances. The authority might not be able completely to clear the snow and ice. It may have to take other steps, such as gritting, and so on. As I understand it, such a piece of footpath would be covered by the obligation.
Lord Carmichael of Kelvingrove: I am grateful to the noble and learned Lord the Lord Advocate for that explanation. I understand the points that he is making and accept most of them. The Bill is largely non-political, but one of the few political points that the Bill brings up is this. If local authorities are now to be responsible, even in the cities that the noble and learned Lord mentioned—Aberdeen, Glasgow, Greenock and Dundee—for clearing snow from in front of commercial premises (which has previously been done by owners or occupiers), it will involve the authorities in considerable additional expense at particular times of the year. But that is a political point which can be taken up at a later date. In the meantime, I am happy with the explanation given by the Lord Advocate and beg leave to withdraw the amendment.
The Earl of Selkirk: Clause 33 is an entirely new provision. I think it is a very' good clause. But when the precipitation is snow the clearing up falls to the region, whereas when the snow turns to dirt it falls to the district. Can the Lord Advocate give us some picture of how he distinguishes between the two? Two authorities are responsible for cleaning up the roads. Snow when it turns to dirt can also endanger people. It is not easy to see the distinction. Do the Government have a clear distinction in mind between the two duties, which are very similar?
Lord Mackay of Clashfern: In so far as snow and ice constitute dirt—which I suppose is matter out of place or something of that kind—the district has a duty to take proper steps to remove it. That is a duty which obviously cannot be performed at the same rate in every situation. It might take a long time fully to remove all the dirt. The cleansing function is on the district, or islands, authority, but where there is snow and ice in question—and, as I say, there may be an overlap here—the obligation to take reasonable steps to prevent them from constituting a danger is on the roads authority. That is in accordance with the recommendations of the committee presided over by my noble friend Lord Stodart of Leaston. As I said earlier, that does not necessarily mean that the snow and ice will be removed. It may add to the dirt by putting on grit, and so on. I should not like to attempt to analyse the point at which the obligation passes from one authority to the other. Both obligations can exist together. That is the position that we have adopted.
Amendment, by leave, withdrawn.
Clause 33 agreed to.
10.15 p.m.
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 76:
After Clause 33, insert the follwing new clause:
("Provision of signposts. Signposting
.—

(1) A roads authority shall take such steps as they consider reasonable to ensure that all roads and footpaths for which they are responsible are adequately signposted in order to facilitate the pasasge of motor vehicles and pedestrians.

(2) District authorities shall encourage all identifiable communities to display signs showing the name of their community for the benefit of pedestrians and motorists using the footpaths and the roads.").

The noble Earl said: This is a Bill to deal comprehensively with the management of roads, yet there is nothing at all in it dealing with signposting, which is an integral part of the management of roads and without which roads could not properly be used. To my mind this is a very important element. If there are no road signs, there is great additional traffic congestion. The point becomes still more important when we increase the number of one-way traffic schemes, bypasses and M-roads, since if one gets on to the wrong road one might have to go a long way round to get back on to the right one. Further, signposting is extremely helpful to tourists in this country who want to find their way from one place to another.
It seems to me very strange that while the Bill is said to codify and modernise the whole of road management, hose who are responsible for and charged with looking after roads are told nothing whatever about signposting. I do not suppose that the words of my new clause will be particularly appreciated by the draftsman, who has very much had his own idiosyncratic way of writing the Bill, but I think we should not go through our consideration of the measure without emphasising the extreme importance of proper signposting. I agree that signposting has been greatly improved in recent years, but I believe that its importance cannot be over-estimated.
My amendment contains a second point which deals with the identification of small communities. In this regard signposting has improved in certain places, though not in all places, and the only people who can improve it are those who manage the roads.
Quite recently the British Tourist Authority made a statement on what it has in mind for the coming year. I should like to read to your Lordships' Committee part of a report on that statement because it emphasises very clearly the authority's intention. The report states:
"The British Tourist Authority, keen to promote the trend, is emphasising its Heritage '84 theme"—
by which it means areas outside the centres—
"to coax visitors beyond London, Oxford and Stratford-upon-Avon".
In other words, it wants people to go to the small communities in the country, outside the large centres. I think that that is right. Personally, I have always advised foreigners who visit this country not to stay in London. London has its greatness and its smallness, but it has a certain resemblance to all other capitals. If people want to see our heritage, they must go out into the country. Very often they go by car, and if they are to know where they are they must see well-marked

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signs showing the name of the small villages, which in many cases are unique. Signposting is of very great value in regard to the movement of traffic, and there should be incorporated in the Bill provisions relating to the signposting of centres and villages. I am quite sure that the noble and learned Lord will not like the words of my amendment, but I believe that this is an important matter and I would ask him to consider it very carefully. I beg to move.
Lord Mackay of Clashfern: I entirely agree with the noble Earl in relation to the importance of signposting. However, I earlier sought to explain that the Bill is concerned more with the construction of roads and the financial arrangements in regard to that, as well as the responsibilities of the road authorities regarding construction, maintenance and so on, than with management.
There is another area of road traffic regulation which is important, and that is the area of administration controlled by the Road Traffic Regulation Act 1967. In 1981 there was made under that Act a series of regulations and general directions concerning traffic signs which prescribed the signs which may be used by road authorities. Under Section 84 of the 1967 Act, roads authorities have a duty to secure expeditious, convenient and safe movement of vehicular and other traffic, including foot passengers. In fulfilment of that obligation, they have powers under Section 55 of the Act to take such steps as they consider reasonable to ensure that roads for which they are responsible are appropriately signposted. I am therefore glad to assure my noble friend that the first part of the amendment is covered by the 1967 Act and the regulations made under it which is the appropriate place for dealing with road traffic signs.
As regards the second part of the amendment. I should explain—as indeed I think my noble friend pointed out—that it is appropriate that road signing should be exclusively a function of roads authorities, and we certainly think that it should remain so. It would be dangerous to allow anyone other than a roads authority to erect signs on roads and quite wrong for anyone else to be encouraged to do so. The traffic signs regulations to which I have referred prescribe signs for the naming of towns, villages, regional boundaries and even rivers and inland waterways. I am not aware of widespread complaints that such signs are not being provided. The report of the Committee chaired by my noble friend Lord Stodart in effect recommended, as my noble friend Lord Selkirk has also stated in explaining the amendment, that the provision of such signs should remain with the roads authorities.
Obviously, anyone who can obtain the necessary planning consent may be able to erect signs out with the confines of the road. The same applies to signs on those footpaths excluded from the meaning of "road" in Clause 143, covering cases like countryside paths. These would not he road signs, however, and it would be inappropriate to have in the Roads (Scotland) Bill a provision such as that proposed here relating to particular signs of that kind. The main answer that 1 give to my noble friend is that I share entirely his
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concern. I appreciate entirely the importance of the matters that he has raised. But, as he says, it is a matter primarily related to the traffic on the roads, and the Road Traffic Regulation Act is the correct place for that. We have not sought to bring into this Bill anything that is primarily related to road traffic. It is construction of the roads and related matters that are the province of this legislation.
Lord Hughes: I was much impressed by what the noble Earl, Lord Selkirk, said. The noble Lord will probably agree that what the Minister has said about the other piece of legislation is helpful. But it is only helpful to the extent that the roads authorities take a reasonable view. The places where purpose signposting is most necessary are the roads that bypass existing communities. These communities have existed for centuries, but suddenly find, due to the policy of the roads department, that their very existence is imperilled. I recall, for instance, the row a year or two ago, when the village of Blackford—I then lived only a few miles away—was by-passed. Within a matter of months, the jobs in that community were almost destroyed.
A great deal of money had been spent on modernising and extending the hotel there. But people travelling along the by-pass had no indication that there was anything there at all. The attitude of the roads authority, when judged from the point of view of making the roads safe to travel along, was perfectly reasonable. It wanted the fewest possible signs so that drivers did not have their attention distracted. However, enabling people to move safely and as fast as safety will permit. is one function of roads. The primary function of roads is to take people to places. If signposting is cut down, tourists to Scotland in the summer can suddenly find that they are past the place where they can have a meal, obtain petrol or go sightseeing. I can well imagine that people had in mind a visit to Blackford but they were not aware that they were past any possibility of getting there. So the roads authorities should keep it in mind that, apart from providing a road for fast, safe moving traffic, there is also the purpose of it leading to communities. I have mentioned Blackford but I could just as easily have mentioned a dozen other places. Years ago Dunblane was complaining about what might have happened.
It should be kept in mind that these are communities which have existed not for decades but for centuries. I can imagine them not paying much attention to something which has just sprung up overnight. Indeed, perhaps there would be a justification for it being ignored. But too often the attitude of the roads department has been that what the road has brought, the road is entitled to take away. That was the argument put forward when people complained that the by-pass would cause them to lose money. The by-pass is desirable and most of the shopkeepers and traders have accepted that it is in the best interests of everybody to by-pass communities with narrow streets and which have vehicles perhaps parked on one side or the other of the street. That is not a safe place for fast traffic to be moving.
Nevertheless, there should be every possible encouragement, consistent with road safety, to let

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people know that they can go to these places. I suggest that the noble and learned Lord the Lord Advocate should convey to his friends in the Scottish Office that a more liberal interpretation of signposting on main roads would be very desirable. If they do that there may not be any need for additional legislation. However, at present I doubt whether anybody in Scotland would agree that the signposting policy which is carried out is entirely satisfactory.
Lord Drumalbyn: There are certain respects in which I agree very much with what the noble Lord opposite said. However, there is one aspect which must always be kept prominently on people's minds when they are planning road signs, and that is prompt advance information so that people will not stop in the middle of the road and start looking for their destination. It is very difficult for people constructing roads and road signs and who know the district, and so on, to put themselves into the minds of people who do not know where they are but who are trying to get to their destination. I put some stress on that aspect. It is particularly important when one is driving on fairly poor roads—that is, poor in comparison with others. Road surfaces have improved greatly in recent times and that has meant that vehicles go faster.
What chance has a person looking for the way to reach his destination, when he is competing with a fairly narrow road with a good surface and inadequate road signs? That is one side of the matter. The other side is to try and anticipate the gaps in the motorist's knowledge. So often the person journeying finds marked only one of the places that he seeks. It is important to try to retain the tradition of showing a number of places all clearly marked on the sign and to try to get them all together so that people will not make mistakes and cause accidents through dithering, as we normally say, through failing to find their way and then getting fussed, and all the rest of it.
There is a science in this which I believe we have not mastered to an extent comparable with the sheer making of the roads. The roads are made for use by people, and it is the people and the places they want to get to which have to be borne in mind. I would add that particular aspect of the problem which I hope my noble and learned friend will consider.
The Earl of Selkirk: I must admit that my noble and learned friend gave me the answer that I expected, but I do not think it answers the point which the noble Lord, Lord Hughes, made with great force and clarity. The Ministry of Transport is responsible for safe driving, but they do not help me to get to Little Puddleton-on-Sea. They do nothing to help me in that way at all. It is nothing whatever to do with them on that side. This is a matter which concerns the convenience of the public and particularly the value to the tourist trade, which we must not underestimate. As the noble Lord said, with the variety of one-way traffic today, and with bypass roads, you can make mistakes which cause you to take hours longer to get anywhere, besides missing points of particular interest in certain villages which may be off the bypass roads.
I am not going to press this matter any further, but I should like to ask my noble and learned friend to look at this carefully. When you come to the naming
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of places it is the road authority's business; it is nothing whatever to do with the Ministry of Transport. They are looking at it through a different set of spectacles altogether. I do not want to press this matter, but I should like my noble and learned friend to look further at it.
I believe this is important, and that more could be done under the heading of management of roads. This is the responsibility of somebody who manages the roads: it is not the responsibility of the traffic code, or of the Ministry of Transport. I am only asking my noble and learned friend to look a little more closely at the points I have sought to raise. Unless he wishes to say something, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10.32 p.m.
Clause 34 [Provision of lighting by roads authorities]:
[Amendment No. 77 not moved].
On Question, Whether Clause 34 shall stand part of the Bill?
Lord Hughes: On lighting,
"A local roads authority shall provide and maintain lighting for roads, or proposed roads, which are, or will be, maintainable by them and which in their opinion ought to be lit".
I do not think I have ever heard of anybody objecting to a local authority deciding to light a road, but what I have heard more than once are objections to a local authority refusing to light a road where people consider it is dangerous. In this clause, however, the matter is left entirely in the local authority's hands, and no matter how dissatisfied people may be there does not seem to be any chance of a second go at it.
Am I correct in thinking that there is no appeal procedure of any sort against a local authority's decision not to provide lighting? Say, for instance, all the residents in a street say that their street is dangerous for a variety of reasons—a child may have been knocked over, somebody may have been attacked in the dark, somebody may have been mugged, and so on—and yet the local authority, perhaps for what may seem to them sound reasons, say, "We have spent all the money we had available for lighting, and we do not have any to do that". There does not seem to be any way of overturning a refusal to provide lighting. Am I right, and is it the Government's intention that this is a case where it must be left entirely to the discretion of the local authority?
Lord Mackay of Clashfern: There is no appeal provision or anything of that sort. It might be going too far to say there are no circumstances in which it might be possible to challenge a decision of a local authority in court; an entirely unreasonable decision exercised under statutory powers might be challengeable. That is not necessary to provide; it is already there under the general law. But it is thought that this is a matter which can reasonably be left to the wise judgment of the local authority.
Lord Hughes: In a way that is quite a satisfactory answer, not from the point of view of lighting the road, but to have this statement from the Lord Advocate that there are some cases where the Government are prepared to admit that a local authority can be a good judge in its own case. In recent years there has not been much evidence of the fact that the Government thought that the local authorities had that power to make a proper decision.
The Earl of Selkirk: At one time there was a connection between restricted speed and lighting. Is it still the law that if one does not have lighting one cannot have restricted speed? This adds a further point which should be borne in mind. Does my noble friend know the answer to that?
Lord Mackay of Clashfern: My recollection is that the power to impose the 30 mph speed limit is related generally to lighting, but I do not think it is absolutely so. I would need to look into that more fully.
In relation to the last point made by the noble Lord, Lord Hughes, the Government have always taken the view that there are many matters which are properly committed to the wise discretion of local authorities. Parliament has never given an absolutely free hand to local authorities to do exactly what they like. That may be the matter to which the noble Lord, Lord Hughes, is referring.
Lord Hughes: We shall not agree on this because it is a matter of Government policy—local authorities are free to do as much as they like, provided that they do not spend money on it.
Clause 34 agreed to.
Clause 35 [Construction of road humps by roads authority]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 78:
Page 24, line 10, leave out ("30") and insert ("20")
The noble Lord said: I am sure that the Lord Advocate realises that this is an amendment merely to allow me to ask a number of questions about road humps. I can clearly see that the amendment is, in many ways, out of place because there must be very few places—I can think of only two or three rather special cases in the City of Glasgow—where there is a 20 mph limit, far less a 30 mph limit.
My noble friends and I are concerned about the use of road humps, and, should road humps come, what speed limits should be authorised on roads that contain road humps? So far as I am aware, there are no statutory road humps in Scotland, although they have been operating south of the border for some time. The only road humps I am aware of are those in one or two colleges and hospitals and such places. As a motorist with some enthusiasm, I admit that seeing a road hump is about the only thing to make a motorist reduce his speed—the safety of his car is involved—and nothing done about signs will affect
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him as long as the road appears to permit a speed well within the capabilities of his car.
We are concerned to ask the Lord Advocate for more information about road humps. Will there be full consultation? I know that this is dealt with in the next clause, but I should like to know how full the consultation will be. How will the House be consulted? It is quite a big breakaway and I do not think that many of the motorists in Scotland really appreciate what is likely to be happening in the next few years. I wonder if the noble and learned Lord has any idea from the department of how urgent is the question of road humps and what speed limit there will be on roads with them. As mentioned in a later amendment, No. 69, will the signs need to be illuminated?
Generally speaking, we feel that this is such a big matter that the House should be given separate opportunity when the regulations are ultimately formulated to discuss them at some considerable length. I should like to have these assurances from the noble and learned Lord, the Lord Advocate. From a purely legalistic point of view, this amendment may appear a nonsense, but I think it provides the only opportunity we can get to ask the Government to make their intentions clear. I think I should emphasise that we agree with the necessity and success of road humps in England; but there will be a lot of questions from the motorists in Scotland that we shall have to answer when humps are introduced. I hope we can have the assurance of the noble and learned Lord that they will be thoroughly discussed, both here and outside, with the various organisations and with the public at large. I beg to move.
The Earl of Selkirk: I wonder if I might support what the noble Lord, Lord Carmichael, is saying, This is an entirely new innovation. I believe I am right in saying. I think that the manner in which it is introduced is extremely important and that what the innovation is exactly should be fully explained. Humps can be extremely dangerous. I personally would not drive over a hump at a speed of over ten miles an hour. They should never be on a road with traffic of more than 30 mph. It will mean that cars will have to slow down to a very low speed. It is extremely important that Parliament should have a very full opportunity of considering what is intended and the public should fully understand the nature of what is contained in Clause 37.
Lord Mackay of Clashfern: Your Lordships are aware that the Secretary of State would require to make regulations in relation to the authorisation of road humps and to their construction and maintenance. The regulations which are presently in place in England and Wales provide requirements as to lighting, location and spacing of the humps. They also require there to be on the road leading to the hump, and near to it, at least one obstacle such as a bend or junction which will have the effect of reducing traffic speeds. It would be the Secretary of State's intention that equally rigid regulations would be applied in Scotland and it is obvious that, in considering these regulations, he would want to take account of as full a view as he could have of what was appropriate.

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I also very much take the point of my noble friend Lord Selkirk about the need, if and when road humps are introduced, to explain the situation. I was also asked a question about the procedure for such regulations. The procedure is the negative resolution procedure which will apply to regulations made under this provision in terms of Clause 135.
Lord Carmichael of Kelvingrove: While I appreciate the answer given by the noble and learned Lord, I was disappointed when he said that it was the negative resolution procedure. This procedure, I believe, allows for no amendment. I reiterate the point made by the noble Earl, Lord Selkirk. This has been used in the South but it is absolutely new to Scotland; and anything associated with roads and motor cars is something that raises a great deal of public interest, as I am sure the noble and learned Lord is only too well aware. I hope that great delicacy and great wisdom—which is not always the case with any Government—are used before this innovation is brought before the Scottish people. I hope, for instance, that there will be opportunity for your Lordships to look at draft provisions before final regulations are brought in for a once-and-for-all yes or no in this Chamber.
I am personally enthusiastic about the necessity of road humps but I believe that we should all be giving ourselves a great deal of trouble unless we proceeded with care in the introduction of them. They are something which people are afraid of, to begin with at least, and therefore they have to be treated with great care. I should like people to have the opportunity to study the situation and write to their Member of Parliament, if necessary. I hope that both Houses will make it possible for a wider appreciation of the importance of road humps and of the reasons why they are being put in certain places. We should try to give them a good send-off and I hope that the Lord Advocate will take note of these things. I had a little experience in the other place when the legislation was introduced originally; and it is important to get the public on your side at the beginning, which is not always easy. I think that most people now appreciate the situation when road humps are used wisely and well, and they are accepted. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 35 agreed to.
Clause 36 agreed to.
Clause 37 [Regulations concerning construction and maintenance of road humps]:
[Amendment No. 79 not moved.]
Clause 37 agreed to.
Clauses 38 to 42 agreed to.
Clause 43 [Exercise of powers in respect of cattle-grids etc. by agreement between neighbouring authorities]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 80:
Page 29, line 9, leave out ("by the Court of Session; or")
The noble Lord said: This is a very simple point, as I suggested earlier, about the Secretary of State or the sheriff taking responsibility for certain things. It does seem almost pompous to ask the Court of Session to adjudicate or make appointments of this nature. I feel it is unnecessary, as the sheriff would be quite capable of making a decision or disposition on this matter. I beg to move.
Lord Mackay of Clashfern: The reason for inserting reference to the Court of Session is that these cattle-grids might come at the boundaries of estates, and the boundaries of estates sometimes come at the boundaries of sheriffdoms. To have the grid exactly on the boundary of a sheriffdom means that there is no particular sheriff court to apply to. It is to cover that possibility that the Court of Session is involved. There is no problem in going to a sheriff's court, which is where you would normally go if the sheriff is available. It is only in that event that one would think of going to the Court of Session, and in these circumstances it seems reasonable.
Lord Carmichael of Kelvingrove: I can see the point which the Lord Advocate is making. It is an "either/or" situation. If it is on a boundary, it will go to the Court of Session, but if there is a sheriff available it will go to him to determine.
Lord Mackay of Clashfern: We do not need to provide that, because that would he the practical way in which it would operate. Nobody would go to the Court of Session if he could go to the sheriff in the ordinary circumstances. That is the practical way in which it would happen.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 43 agreed to.
Clauses 44 to 47 agreed to.
Clause 48 [Planting of trees, shrubs and grass or other plants by roads authority]:
[Amendments Nos. 81 to 83 not moved.]
Clause 48 agreed to.
Clauses 49 to 52 agreed to.
Clause 53 [Provision of picnic sites for trunk roads etc.]:
The Deputy Chairman of Committees (Viscount Simon): I understand that Amendments Nos. 84 and 85 are alternative amendments.
10.52 p.m.
Lord Hughes Lord Hughes moved Amendment No. 84:
Page 33, line 28, leave out ("other than a regional, islands or district council")
The noble Lord said: I suggest that I speak to Amendments Nos. 84, 85, 86 and 87 together, because Amendments Nos. 84 and 86 are one pair of amendments and Nos. 85 and 87 are another pair.
Amendment No. 85: Page 33, line 28, leave out ("other than") and insert ("or")
Amendment No. 86: Page 33, line 30, at end insert ("or council")
Amendment No. 87: Page 33, line 30, at end insert—
("( ) A regional, islands or district council shall not provide meals or refreshments on the picnic site without the consent of the Secretary of State")
The Bill, as it stands, places an absolute embargo on a regional, islands or district council providing meals or refreshments on a picnic site, so that is one extreme method of dealing with the matter. Amendments Nos. 84 and 86 remove the embargo entirely, so that a regional, islands or district council would have total freedom to provide refreshments at picnic sites. I suggest that Amendments Nos. 85 and 87 are an alternative form and are a halfway house. They take out the embargo, which is contained in the Bill as it stands, but then Amendment No. 87 adds a new subsection which states:
"A regional, islands or district council shall not provide meals or refreshments on the picnic site without the consent of the Secretary of State".
So my suggestion is that it is not necessarily reasonable to prevent these local authorities from providing, because there may be very desirable places where refreshments would be desired, but nobody in the area was interested in taking it on. But a local authority may see considerable advantage for their areas in doing so, even although that might involve them in taking it on at a loss, because I am quite certain that if there was a profit to be made, there would be no difficulty in finding somebody outside to do it.
But the Government, if they were prepared to depart from the terms of the Bill, would probably not be enthusiastic about the possibility of an authority embarking on such a project without proper consideration and would want to have some control over it. So on this basis I suggest that our alternative, less radical, proposal makes it possible for this situation to develop.
A picnic site is being created. It is desirable, if it is at all possible, that there should be eating facilities there. The local authority invites tenders for the job. One possibility is that people will expect to be paid something to enable them to provide the service. The Secretary of State would want to know what opportunities had been given to the private operator to provide these facilities. He might come to the conclusion that it was more desirable for the local authority to provide the facilities than to have no facilities at all. If I were to take a dogmatic view I should prefer to give complete freedom to the local authority, but given the extent to which that freedom is restricted in the Bill I would suggest that the Government should at least open the door, provided that the Secretary of State agrees that the door should be open. Therefore, I beg to move, technically, Amendment No. 84.
Lord Mackay of Clashfern: Our approach to this matter is that local authorities should not be in the hot-dog and coffee stall business. No doubt some of them are capable of providing very good hot-dogs and very good cups of coffee, but we do not consider that that is what they were elected to do. This is a field
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where the private sector can do at least as well—indeed, better, because of their greater awareness of competition and of the link between customer satisfaction and profitability. In our view, local government should be left to get on with the many activities which only it can perform and should not be distracted by venturing into the snack-bar business.
While I appreciate the spirit in which the noble Lord has put these amendments together, I am afraid that I must advise the Committee not to accept them.
Lord Hughes: This is probably one of the few amendments which would affect the principles contained in the Bill. It would be futile to call a Division on it at this stage. However, in withdrawing the amendment and in not moving the other three I give notice to the Committee that I intend to return to the matter at the next stage of the Bill. It may then be possible to deal with it at an earlier stage in the proceedings.
I am amused by the touching faith which the noble and learned Lord the Lord Advocate puts in the ability of private enterprise to provide satisfactory facilities. The facilities provided on the motorways do not always meet with the unanimous approval of those who are unfortunate enough to pick the wrong ones, where the food can be atrocious and the service worse. There is no guarantee that private enterprise will always do it better. If there is the possibility of a great deal of business being done, private enterprise will be interested, but I am thinking about such areas as picnic sites. Private enterprise may not be interested in picnic sites, although there may be a demand by the public for facilities to be provided. As the Bill stands, local authorities would be denied the opportunity to provide those desirable facilities. Therefore, the Government ought to consider opening the door.
I hope that the Scottish Office will give a little more thought to the matter. By saying that it should be only with the consent of the Secretary of State I know that I am giving a hostage to fortune, but I cannot believe that the Secretary of State would allow money to be spent on a picnic site and then, because of a very tight provision in the Bill, would prevent proper use being made of the facilities.
I agree that in almost every case, if not in every case, the first approach would be to try to get the private caterer to take it on. I am seeking to make provision for those cases where that would not be the result, but where there is a desire for something to be done. After all, most of the authorities concerned do have facilities in their school meals provisions, and so on, which could quite easily take on simpler meals. People who stop at picnic sites are not expecting a place having four stars from Egon Ronay, or anything of that kind. They are expecting something quite simple, and it would not be beyond the bounds of some local authorities to provide it.
I hope that the Scottish Office will consider this matter further; but if they do not do anything more about it, then we shall return to this point at the next stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 85 to 87 not moved.]
Clause 53 agreed to.
11.2 p.m.
Clause 54 [Control of works and excavations]:
On Question, Whether Clause 54 shall stand part of the Bill?
Lord Hughes: I notice that in the heading to Clause 54 the words "works" and "excavations" both appear in the plural. Then, throughout the clause "works" is always in the plural but in all cases except one "excavation" remains in the singular. The one instance where it is shown in the plural is in subsection (3), where it states
"This section does not apply to works or excavations".
I do not care which way it is done—whether it is in the singular or the plural—but will the noble and learned Lord ensure that it appears in the same form throughout the clause?
The word "excavations" is to be preferred in view of the fact that "works" is in the plural throughout and that the heading of the clause is "works and excavations". I draw this point to the attention of the noble and learned Lord, and perhaps he will make the necessary minor adjustments at a later stage.
Lord Mackay of Clashfern: Subject to the appropriateness of the context. Sometimes it is not absolutely clear that it would be right to do so, but I shall certainly look at that point.
Clause 54 agreed to.
Clause 55 [Dangerous works]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 88:
Page 35, line 37, leave out ("street") and insert ("road").
The noble Lord said: This is a very small amendment which, as the Bill itself now designates everything as a road, attempts to question the Minister why the word "street" has been reverted to in the phrase "street works code" when it is not even "Street Works Code" in capital letters. It appears that in order to keep that subsection in balance with the rest of the Bill it would be easy to replace the word "street" with the word "road". I beg to move.
Lord Mackay of Clashfern: It would of course be desirable, if one could do it, to make the word "road" prevail completely, but the phrase "street works code", to which the noble Lord has referred, comes within the Public Utilities Street Works Act 1950, and we cannot really amend the title of that Act. The code comes from that Act, and therefore I would suggest that it is appropriate to leave that phrase as it stands.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 55 agreed to.
Clause 56 agreed to.
Clause 57 [Control of obstructions in roads]:
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 89:
Page 37, line 10, after ("road") insert ("or on the verge").
The noble Earl said: The greater part of the safety regulations regarding the obstruction of roads concerns what is deposited on the road and what people do who own the land on each side. I am taking a different example here which I believe requires to be covered. It is: what happens on the verge of the road; and, in particular, what happens with the digging of a ditch and the placing of the scourings from that ditch? This can take over the years quite a high level, and in a narrow road with turnings off it, it can very seriously obscure the view.
There is no obligation here on the landowner—because this is the verge of the road, which must belong. I take it, to the road authority. There is very little duty put upon the road authority, in fact there is none, about keeping the verges of roads clear. There are some cases in open land where that does not matter, but in other cases where the roads are narrow this is extremely dangerous and should be put right.
I am suggesting, in this amendment and my following amendment, that in cases where the scourings from a ditch reach a stage where they seriously obscure the vision down the road the road authority should have a duty to deal with it. Although this Bill goes into very great detail on all sorts of subjects, this is an important aspect which is omitted. I ask the noble Lord either to accept these words or to undertake to look very carefully to see that this particular aspect is covered by this very comprehensive measure. I beg to move.
Lord Carmichael of Kelvingrove: Perhaps I may support the noble Earl, Lord Selkirk, on this point. I have had communication on a very similar point which I would imagine would be included in this particular clause by this amendment. It appears that there is an omission, apparently a gap in the Scottish law, which may be able to be corrected in this Bill. The story I have been sent is that a hedge-cutting machine threw thorns across a road and they burst the tyres of a vehicle; the owner had very great difficulty in getting any recompense from the farmer or in persuading the police to take any action. That is bad enough, but of course there also could have been considerable personal injury; there was none in this case, I am glad to say—but there could have been.
I understand that in England and Wales the position is clearly covered by the Highways Act 1980, Sections 148, 149 and 161. I can summarise these; they provide that if without good reason a person deposits anything whatsoever on a highway to the interruption of any highway user he commits an offence, as he does if a highway user is injured or endangered in consequence of such deposit. Under Section 161 a highway authority has power to remove a deposit which constitutes a nuisance, charging the cost to the person who made the deposit.
I understand that there is a comparable provision in Scottish law in Section 24 of the Roads (Scotland) Act 1970, but this is not carried on to the Bill we are discussing. According to my information, the words in the Bill appear not to contain anything like the existing Section 24. Accordingly, it seems desirable to incorporate into this Bill provisions modelled on the Highways Act 1980 by way of new clauses. I wonder whether at a later stage the Lord Advocate, having

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considered the points made by his noble friend and myself, would consider adding new clauses, unless he can explain that Section 24 of the Roads (Scotland) Act 1970 is in some way covered in the present Bill.
Lord Mackay of Clashfern: My impression is that the situation to which the noble Lord, Lord Carmichael of Kelvingrove, referred is covered, but since it is a particular case I should like to look at it in more detail and deal with it later.
As regards the amendment of my noble friend Lord Selkirk, the position is that in Clause 143 we have defined "roads" to include the verge because we entirely agree that it is extremely important that matters of road safety are not confined to the carriageway in the situation to which he referred. Therefore, in the interpretation clause, to save repeating it in every case, the definition of "road" expressly states, on page 91, line 15, of the Bill, that this includes the road's verge. That is intended to cope with the problem to which my noble friend referred. It is not necesssary to state every time that the verge is included.
The Earl of Selkirk: Is it clear from this that there is a duty on the road authority, within the meaning which my noble and learned friend says, to clear it away? Under what sanction can that duty be brought into play?
Lord Mackay of Clashfern: Clause 57 makes it an offence to cause an obstruction except with the consent, in writing, of the road authority, and there is no question of the road authority consenting to something that constitutes an obstruction. Anyone who contravenes that clause commits an offence. The situation would be that if a contractor or employee, or someone of that sort, deposited something on the verge and created an obstruction that person would be committing an offence unless he did so with the authority, in writing, of the road authority—and there would be no question of that.
The Earl of Selkirk: May I put a direct question to my noble and learned friend? Supposing an employee of the road authority does exactly that, and someone using the road wishes to get that obstruction removed. How can he do so? Can a user of the road sue the road authority? I happen to know of a case in point where the local authority has declined to take away something of that nature. Can an action be brought against the road authority?
Lord Mackay of Clashfern: The situation is that if it is done without the consent of the road authority, an offence is committed. If a danger is created by the actions of the road authority that would certainly be actionable. But the main sanction is a direct one. It is a criminal offence if a person puts an obstruction on the verge without the consent, in writing, of the road authority.
The Earl of Selkirk: I shall not pursue this, but clearly he will be an agent of the local authority and, as such, will be acting on behalf of the local authority.
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The local authority will therefore be responsible for his actions. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Selkirk The Earl of Selkirk moved amendment No. 90:
Page 37, line 10, after ("obstruction") insert ("or seriously restrict the view of on-coming traffic").
The noble Earl said: There is not a great deal in the Bill about obstructing views as such but more about obstructing passage. I do not say that this part of the Bill is the only place for such a reference, but there is nothing in this clause which deals with this point. It is an important point, and just as important as the actual obstruction of the road. I suggest to my noble and learned friend that it should be better emphasised. Whether or not this is the right place I am not sure, but a view that is obstructed is a matter of importance on any road. I beg to move.
Lord Mackay of Clashfern: I think that the provisions that particularly relate to the obstruction that my noble friend has in mind are adequately covered by Clauses 80 to 89. But I shall certainly look again at the matter in the light of what he has said. However, that is my impression having looked at his amendment and the Bill.
The Earl of Selkirk: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
11.16 p.m.
On Question, Whether Clause 57 shall stand part of the Bill?
Lord Hughes: I take the opportunity of the debate on whether the clause shall stand part of the Bill to ask the Government what their intentions are for further debating the Committee stage of the Bill. We had an informal discussion about what would be a reasonable time to adjourn. No one can say that we have delayed the legislation. We have been exceedingly co-operative. But with all the remaining amendments there is no way that we can sensibly conclude proceedings on this Bill tonight. Many of the remaining amendments are Government amendments in the name of the noble and learned Lord the Lord Advocate and at least one could be the subject of a major debate. There are large amendments to the schedules and all the amendments to the schedules are Government ones.
I was asked how long we might take if the debate went over to another day. I cannot possibly give an undertaking that we shall finish within a certain time because I do not know how long the Lord Advocate will take on his amendments. It is not in the traditions of the House that we should go on unreasonably. If the Government wish to continue and attempt to finish the Bill tonight, we shall play along, but I cannot guarantee that we shall continue to be so co-operative if there is no co-operation from the Government.
Lord Lyell: As the noble Lord knows, I have borne the heat of the entire afternoon in two previous debates. I have no instructions. The noble Lords, Lord

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Hughes and Lord Carmichael of Kelvingrove, could perhaps continue until instructions are obtained through the usual channels. I yield my position to my noble friend Lord Denham to see what he has to say.
Lord Denham: This is the second day that we have spent on this Bill. I hesitate to keep your Lordships short of time on this important Bill. Of course your Lordships must consider it to the fullest extent that you feel necessary. On the other hand, I do not think that it is possible to say that we must have as much time as we want to consider the Bill; but, equally, that we must rise at quarter past eleven in the evening. This is the second day. I remind your Lordships that on the first day we got through 21 amendments in quite a long time.
Lord Underhill: Three and a half hours.
Lord Denham: No, more than that. I then suggested that the House rose at, I think, a quarter to eleven rather than asking your Lordships to stay longer in the hope that we should be able to finish today. We have not made very good progress today, when one considers that we got through 21 amendments on the first day, we have just completed Amendment No. 90 now and there are over 170 amendments. Of course I should not ask your Lordships to sit for long if we could have a reliable indication as to the amount of time longer that we need on the Bill. What is the point in adjourning the House at twenty past eleven, coming back for a third day and having to sit until three o'clock in the morning?
Lord Hughes: The noble Lord says that on the last occasion we debated only 20 or so amendments. I remind him that tonight we did not start consideration of the Bill until ten to six, and we adjourned for 40 minutes for dinner, which is the equivalent of starting at seven o'clock. We have been debating the Bill for four hours and twenty minutes and have dealt with 60 amendments. We are working at least two and a half times the speed that we did on the first occasion.
I was asked whether I could give an undertaking that if we adjourned at a reasonable time we could finish the Bill in two hours. I could not possibly do that. I thought three hours might be possible, but I cannot give undertakings. I am not in charge of the Bill on this side of the Committee. I am playing this part today because my noble friend Lord Ross of Marnock is unable to be here, but any undertaking which I give would not be binding on him. To suggest two hours is quite unreasonable. I would say to the noble Lord: has he looked at the amendments, has he asked his noble and learned friend how much time he is going to take to handle his amendments, because all the amendments to the schedules are Government amendments?
I know that it is not right to quote what has been said, and I am not going to do it. But I shall remind the noble Lord the Government Chief Whip of what he said to me at the close of the last proceedings and of the threat which he made to the Opposition, because of his displeasure at what had taken place the first time out. If this is in fact the carrying out of a threat, then
1034
we shall have to work on the basis that we are being threatened—and threats have a very nasty habit of rebounding on those who make them.
Lord Denham: It seems to have rebounded on me tonight, if I may say so. But this is not the way that we normally decide things in this House. We normally work through the usual channels and decide how far we should go on a certain occasion on a particular Bill. I hope that the noble Lord, Lord Hughes, will in future leave it to the usual channels, because this is the way it is normally done.
I have had consultations with the noble Lord the Opposition Chief Whip, and I hope that I shall continue to do so. But if the noble Lord, Lord Hughes, wishes to raise the matter on the Floor of the House, then I must reply as best I can. The noble Lord will realise that in any Administration the difficulty of getting the Government business through is constant. In this House we have to proceed by consent, we have to work through agreement, and we have to come to some kind of arrangement. The noble Lord, in his time as a Minister, will have appreciated that we talk to the other side. As Opposition Chief Whip I have given undertakings to the Government Chief Whip of the day that if we were to rise at a certain time, I would get the business through by a certain time.
The noble Lord says that he cannot give undertakings for one of his noble friends. When the noble Lord is speaking from that Dispatch Box he can give undertakings, because he is giving an undertaking for Her Majesty's Opposition, just the same as I can give undertakings from this Dispatch Box that are binding on my noble friends here.
Let us go on a little longer. The noble Lord the Opposition Chief Whip and I will have a few words about it and see where we can get, but I would ask your Lordships not to feel that I am trying to gag the House in any way about this. We have to work by mutual understanding and mutual agreement here. Time is limited, and we have to ration it out for the business that is to be done.
The Earl of Selkirk: May I make just one observation—
Lord Hughes: If the noble Earl will, permit me, I would say that I do not want to alter the arrangements. As the Chief Whip has said, normally the arrangements work perfectly satisfactorily. But until dinner there was no indication at all as to how far we might go. I doubt very much whether the Lord Advocate would say that the Bill has been handled unreasonably. We have spoken briefly on amendments. The only amendment on which in fact there was any lengthy debate was one from the noble Earl, Lord Selkirk, which attracted support from a variety of parts of the Chamber. Apart from that, every single amendment has been handled expeditiously. So I think that we have done our best.
So in the negotiations which he is suggesting the Government Chief Whip should first of all ask the Lord Advocate what would be a reasonable amount of time that he would expect to take on the Government amendments. At the same time my noble friend Lord Carmichael and myself will look at the Opposition

1035
amendments, and we can tell him what we would want to add to the Government's time as a reasonable basis on which to continue in order to finish the Bill, whether tonight, or on some other occasion. That is reasonable. To expect me to give a guarantee of the time required when two-thirds of the amendments are Government amendments is unreasonable.
Lord Denham: I shall give way to my noble friend Lord Selkirk in a moment because I think, having started this, it is right that we should air all our grievances. I do not think that this is the right way, if I may say so, to conduct the negotiations between the sides. It has never been done this way before, and, if I may say so, it was the noble Lord, Lord Hughes, who raised this point. I have, of course, been in contact with the usual channels. This has always worked very well before. I think that if we could possibly leave it that way, it would be better in the future. I do not know whether my noble friend wants to come in on this.
The Earl of Selkirk: With great respect to my noble friend, we are now in the month of January. It is important to remember that. Secondly, when he had his discussions in the usual way, did he consider that this Bill would start at 6 pm, I think it was—
Lord Hughes: Ten minutes to six.
The Earl of Selkirk: —with something like 150 amendments to get through? Would he really have done that with an English Bill?
Lord Denham: Yes, my Lords. I assure my noble friend that I would have done it with an English Bill or even a Welsh Bill.
Lord Hughes: If it had been an English Bill, there would not have been only one speaker from the Opposition Benches on it.
Lord Denham: That may be so, but he might have been shorter.
Lord Hughes: I suggest that the noble Lord looks at the timing tomorrow to see how long we have spoken.
Clause 57 agreed to.
Clauses 58 to 62 agreed to.
Clause 63 [Regulation of drivers of horse drawn carts etc.]:
11.27 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 91:
Page 41, line 5, leave out second ("a") and insert ("one or more").
The noble Lord said: This is a drafting amendment which appears unnecessary but with which I suggest that we take Amendment No. 92:
Amendment No. 92: Page 41, line 5, leave out ("(or by draught animals)").
It seems to me neater, instead of saying "or by draught animals", to have the words "by one or more draught animals." I hope that I may achieve some victory on this small point. I beg to move.
Lord Mackay of Clashfern: I am happy to accept this amendment as an improvement. A minor qualification is that the word "animal" that remains at the end of line 5 on page 41 should be plural. If that can be done by manuscript amendment, I am happy with what is proposed.
On Question, amendment agreed to.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment 92:
[Printed above.]
On Question, amendment agreed to.
Clause 63, as amended, agreed to.
Clause 64 [Maintenance of vaults and cellars etc.]:
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 93:
Page 41, line 7, leave out ("things").
The noble Lord said: This is another small point with which the Lord Advocate may be able to help. The word "things" seems superfluous. Apart from that, it does not ring true in an Act of Parliament. Instead of "the following things", the words "the following" would seem to be quite adequate.
Lord Mackay of Clashfern: I am sorry that I cannot accept this amendment as an improvement, although I have had a good deal of discussion with the draftsmen about it. The difficulty is that the word "following" comes a good deal before the things that are supposed to follow it and are being referred to. We shall certainly look again to see whether the clause can be improved on the lines suggested because I can see that there is possible scope for improvement, but I do not think that the amendment quite meets the point.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 94 not moved.]
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 95:
Page 41, line 12, leave out from ("tunnel") to end of line.
The noble Lord said: This amendment has been tabled in order to get an explanation. Paragraph (b) says:
"every opening into any such vault, arch, cellar or tunnel from the surface of the road".
It appears that it does not cover one that is going under the road, but only covers one that somehow or other moves from the road. I may have totally misinterpreted it. However, it seemed to me that:
"from the surface of the road"
was not only unnecessary, but positively confusing. I beg to move.
Lord Mackay of Clashfern: The intention is to deal with openings which are within the road boundary. The amendment, I think, would have the effect of obliging owners or occupiers to keep in order entrances to vaults, arches, et cetera, which were nowhere near the road, and that does not seem to be right.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 96 not moved.]
Clause 64 agreed to.
Clause 65 [Power to direct that doors etc. should not open outward into road].
[Amendment No. 97 not moved.]
Clause 65 agreed to.
Lord Denham: I think it is probably the feeling of the Committee that we should come to a convenient stopping place. After consulting the officials and my noble friends I find that we have now reached the place where we are about to start Part VI. So if your Lordships would like to adjourn at this stage, it would probably be a convenient moment to do so.
I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Aylesbury Vale District Council Bill [H.L.] Bournemouth Borough Council Bill [H.L.] Charing Cross and Westminister Medical School Bill [H.L.] Derwent Valley Railway Bill [H.L.] Hereford City Council Bill [H.L.] Leicestershire Bill [H.L.] London Transport (Tower Hill) Bill [H.L.] Norwich City Council Bill [H.L.] Oxfordshire Bill [H.L.] Southend-on-Sea Borough Council Bill [H.L.] Surrey County Council Bill [H.L.] Swavesey Bye-Ways Bill [H.L.] Warwick District Council Bill [H.L.] Worcester City Council Bill [H.L.]
Presented and read a first time.
House adjourned at twenty-seven minutes before midnight.

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