Sitting of 27 March 1984

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

    ANGLIAN WATER AUTHORITY (KING'S LYNN TIDAL DEFENCES) BILL
    Order for Third Reading read.
    Queen's Consent, on behalf of the Crown, signified.
    Read the Third time, and passed.

    CARDIFF CITY COUNCIL BILL
    Considered; to be read the Third time.
Oral Answers to Questions
  SOCIAL SERVICES

    Women's Hospital, Liverpool
    Mr. Parryasked the Secretary of State for Social Services what representations he has received concerning the proposed closure of 21 beds at the Women's hospital, Liverpool.
    The Minister for Health (Mr. Kenneth Clarke): We have replied to two parliamentary questions and received three letters from hon. Members and five letters from members of the general public.
    Mr. Parry: Is the Minister aware that at present more than 551 women, many of whom are considered urgent cases, need medical treatment at the Liverpool Women's hospital, and that 226 women have been waiting for more than six months for treatment? Is that not disgraceful? Does the Minister agree that any further ward closures will lead only to misery, pain, suffering and fear among women? Is he aware that further ward or hospital closures in Liverpool will be fiercely opposed and resisted by the Health Service unions and by the Labour movement, both inside and outside Parliament?.
    Mr. Clarke: A number of Liverpool hospitals provide services for women. The gynaecological waiting lists in Liverpool as a whole, I am glad to say, are being reduced. Consultations are still taking place on the proposals about the beds at the Women's hospital. I shall not prejudge the matter, but the health authority says that it can provide the same level of service while economising on the number of beds at that hospital.
    With regard to closures in Liverpool generally, I hope that the hon. Gentleman welcomed the proposals of his own excellent local district health authority, showing how £30 million can be invested in new capital projects to provide the services that will be required in future. However, some older facilities in Liverpool will inevitably
    Mr. Alton: Is the Minister aware that many people on Merseyside have misgivings about the reductions in the Health Service, bearing in mind that last year the Liverpool area health authority budget was reduced by £1 million? Is he further aware that, despite reduced resources, the incidence of diseases, such as cancer, is higher than anywhere else in the United Kingdom and that the provision for treatment is one of the lowest in the United Kingdom? Will he therefore come and look at the Women's hospital and other facilities on Merseyside?.
    Mr. Clarke: The allocation of money to Liverpool is falling a little, and it is due to fall, but it is not falling as quickly as the population. As a result, spending per head in Liverpool will increase. The strategy that has been put forward by the chairman and members of the district health authority is one for congratulation, because it shows the way in which the service must change to meet up-to-date needs, as well as making the best use of the money.
    Mr. Porter: Is my right hon. and learned Friend aware that some of us on Merseyside are perfectly satisfied with the amount of money that is available both in the region and in the districts? Is it not for the area health authority and the region, by dint of better housekeeping, to provide the services that are adequate at present?
    Mr. Clarke: I wish it were not a rule of the political game that everyone should feel obliged to claim that his area is under-financed. There are always areas where we can spend more money, and there are many parts of the Health Service where we would get a much better service by continuing to improve management and eliminate waste. Liverpool district health authority has been doing a good job and is providing an excellent service within the resources that have been allocated to it.
    Ms. Richardson: Does the Minister realise that this most recent closure of 21 beds appears to be part of a pattern of attacks on the health of women, both as patients and as workers? In addition to Liverpool, for example, we have the Elizabeth Garrett Anderson, which seems to be having its philosophy turned round by being unable to have women doctors attending women patients. We have the scandalous closure of the South London hospital, about which we still hope—
    Mr. Speaker: Order. The subject is the Women's hospital, Liverpool.
    Mr. Clarke: The hon. Lady should not see any conspiracy between district health authorities, which have not consulted each other about their proposals, each of which is sensible in its own right. Liverpool, by improving the throughput at this hospital, can maintain services. Therefore, progress can continue to be made in reducing gynaecological waiting lists.
    At the Elizabeth Garrett Anderson there is just a faint possibility that every now and again a male registrar will be allowed in, because it is sharing one of the teaching posts with the University College hospital. As for the closure of the South London hospital—
    Mr. Speaker: Order. In fairness, I would rather, that the Minister did not pursue that matter.

    Alternative Medicines
    Mr. David Atkinsonasked the Secretary of State for Social Services if he plans to meet the British Medical Association to discuss its inquiry into alternative medicines.
    Mr. Kenneth Clarke: I have no plans to do so at present.
    Mr. Atkinson: Is my right hon. and learned Friend aware that all the main alternative medical professions have declined the BMA's invitation to submit representations to its inquiry because they do not believe that such an inquiry will be impartial? In view of the growing public support and appreciation for the alternative medical professions, will he now embark on a Government inquiry into them?
    Mr. Clarke: Ministers have no responsibility for the BMA, and we have not been involved in the arrangements for the inquiry to which my hon. Friend referred. We do not at present see any case for a full-blown Government inquiry, but I will consider my hon. Friend's suggestion. It is entirely up to patients to choose the kind of treatment they prefer, although they should make sure, if they can, that they go to reputable practitioners. The Medical Research Council is financing research on behalf of the Government into the treatment of back pain, comparing the results of chiropractic with those of conventional treatments.
    Mr. Freud: If the Minister should set up an inquiry into alternative medicines, may we be assured that it will be wide-ranging? Will he try not to emulate the Health Promotion Research Trust, which is specifically debarred from inquiring into certain diseases — for example, tobacco-related diseases?
    Mr. Clarke: That has nothing to do with the main question. However, I have repeatedly said that that trust is producing £11 million which is available for useful research into health education. It would be foolish to turn down the money simply because it is excluded from one subject for entirely understandable reasons. Those who are genuinely interested in preventive medicine and health education would be cutting off their nose to spite their face by not accepting the money.
    Mr. Greenway: If my right hon. and learned Friend should consider alternative medicines in the form of parallel imports, will he bear in mind that it has been estimated that such imports would cost the home-producing industries £120 million worth of orders a year and 7,000 jobs, which is alarming for my constituents who work in this industry?
    Mr. Speaker: Order. That supplementary question was very wide of the main question. However, does the Minister wish to comment on it?
    Mr. Clarke: Perhaps I can stay in order, Mr. Speaker, by remarking that a common thread running through all the questions is the fact that the Government's only interest is to protect the safety and well-being of patients.

    Hospital Staffing (Birmingham)
    Mrs. Jill Knightasked the Secretary of State for Social Services if he will take steps to ensure that the nurse staffing levels of the Queen Elizabeth and the General hospital in Birmingham are improved.
    The Under-Secretary of State for Health and Social Security (Mr. John Patten): Nurse staffing levels at the Queen Elizabeth and General hospitals, Birmingham, are the day-to-day responsibility of the health authorities concerned.
    Mrs. Knight: Is my hon. Friend aware that the nurse staffing levels at both hospitals, which are teaching hospitals for acutely ill patients, are at the bottom of the national league for staffing levels and that they have been described by consultants working there as dangerous? Is he aware, for example, that fledgling nurses, with the ink hardly dry on their qualifications, are sometimes looking after a whole ward at night? Can he imagine the consternation at the statement by the chairman of the relevant health authority that the £100,000 available for extra nurses would be spread over just a few nurses throughout the whole are and would not benefit the Queen Elizabeth and General hospitals?
    Mr. Patten: I am aware of some of the problems to which my hon. Friend has drawn attention, and I shall look at them. It is significant that the district health authority has injected an extra £100,000 into nurse staffing levels, and doubtless it has the situation under control.
    Mr. Corbett: Will the Minister stop being complacent and acknowlege that large parts of Birmingham are underprivileged compared with the region and country as a whole? Furthermore, does he accept that it is a question not merely of quantity—important though that is—but of the quality of the staff? As the hon. Member for Birmingham, Edgbaston (Mrs. Knight) has pointed out, there are large numbers of wards in which patients are being left irresponsibly in unqualified or semi-gualified hands? What does the Minister propose to do about that?
    Mr. Patten: The Department of Health and Social Security is not complacent about anything. Secondly, the hon. Gentleman is lamentably ill-informed about the situation in his own area. During 1984–85 the West Midlands regional health authority will receive gross money disproportionate to that received by other regions.

    Portable Pensions
    Mr. Tim Smithasked the Secretary of State for Social Services how many representations have now been received by his inquiry into personal portable pensions.
    The Secretary of State for Social Services (Mr. Norman Fowler): By 21 March we had received nearly 1,700 written submissions specifically about portable pensions and a number of more general ones which also dealt with this subject. In addition, I have held four public sessions and heard evidence from 14 organisations.
    Mr. Smith: Is my right hon. Friend aware that although most of the principal representations on this subject have been made by vested interests, one exception is the National Consumer Council, which has called for more choice in pension provision? Will my right hon. Friend ensure that, when the inquiry is concluded, there will be more choice for pension scheme members?
    Mr. Fowler: Yes, Sir. In principle, I entirely agree with what my hon. Friend says. We want to improve conditions so that if someone moves from one employer to another there is an early-leaver provision, which would be fairer. Too many people are adversely affected by the present situation.
    Mr. Hordern: Is it not time that we ended the inequity whereby the full occupational pensions of the few are financed by the contributions of many who have long since left their jobs? Is it not reasonable that every employee should have the option of a portable pension if he wishes?
    Mr. Fowler: That is precisely the point that the inquiry is considering. We have received much evidence about it, and it will be discussed in our final report.
    Mrs. Beckett: Will the Secretary of State tell the House how many of the representations that he has received stress the concern felt by many who are anxious to see the results of the inquiry? Unless there is proper protection for pensioners, there is a danger that the insurance companies rather than individuals will benefit most from the scheme. Is there not a real risk that that will happen unless clear and well-drafted provision is made?
    Mr. Fowler: Clearly, there is a conflict in the evidence. We do not want to do anything which will affect the growth of occupational pension schemes, but, as my hon. Friend the Member for Horsham (Mr. Hordern) has pointed put, we must look at the position of the many people who are either not covered by occupational schemes or whose rights could be improved. We must find a reasonable compromise between the interests of the schemes and of individuals.

    NHS Trade Unions (Meetings)
    Mr. Canavanasked the Secretary of State for Social Services what subjects he discussed at his last meeting with trade union representatives of National Health Service employees; and if he will make a statement.
    Mr. Fowler: On the last two occasions I have met the NHS trade union representatives I have discussed the question of resources for the National Health Service.
    Mr. Canavan: Will the Secretary of State confirm reports circulating at the weekend about a confidential Government document proposing a miserable 3 per cent. wage increase for our nurses and midwives and arguing that their wage levels should be determined by free market forces? Does the right hon. Gentleman not realise that such an offer will provoke a very angry reaction, as it amounts to a wage reduction in real terms and the exploitation of dedicated workers in our National Health Service, no part of which should ever be governed by doctrinaire adherence to free market forces?
    Mr. Fowler: I am sure that the hon. Gentleman will agree that the level of pay must be determined by what the Health Service and the country can afford. The hon. Gentleman is referring to evidence that has been given to the new nurses and midwives review body, which, in due course, will make recommendations to my right hon. Friend the Prime Minister on the level of pay for nurses. That has not yet been done. When it has been, my right hon. Friend will make a statement.
    Dr. Mawhinney: Did the trade union representatives raise with my right hon. Friend the increasing number of consultants who are not fulfilling their full schedule with the NHS? Does he have that problem under review?
    Mr. Fowler: They did not raise that subject with me. If my hon. Friend has such evidence, I am willing to examine and investigate it.
    Mr. Flannery: Is the Secretary of State aware that a delegation of the Association of Scientific, Technical and Managerial Staffs recently went to the Minister for Health about the pay of hospital pharmacists, who are expected to go into work at the weekend and get virtually nothing for it? Will he do something to curb the immense profits being made by drug manufacturers so that people, such as hospital pharmacists, can have higher wages?
    Mr. Fowler: Such matters are all part of this year's negotiations. There is money on offer. I think that it would be sensible to wait until the negotiations have been concluded.
    Mr. Yeo: Will my right hon. Friend make it clear to the trade union representatives that, although we are all anxious that there should be fair and competitive rates of pay for all National Health Service employees, any increase in their rates of pay over and above the 3 per cent. indicator can be achieved only at the expense of other resources for patient care throughout the service?
    Mr. Fowler: As I said earlier, there must be consequences of that. Pay must relate to what the service can afford. That is a sensible point for anyone negotiating in the current pay round to remember.
    Mr. Kennedy: When speaking to trade union representatives in the NHS, will the Secretary of State bear in mind the natural anxiety that they feel about his Department's circular on privatising or tendering contracts for ancillary services, especially as the Government's stated aim of cost-effectiveness cannot be measured in purely financial terms? Patient well-being and the working conditions of people in the Health Service must also be taken into account.
    Mr. Fowler: I was not aware that the alliance has hitherto favoured competitive tendering. Money saved by competitive tendering is available for health care. That is what we are trying to pursue.
    Mr. Meacher: When the Secretary of State sees representatives of the trade unions, will he explain why he always talks about economies and wage cutting when, at the same time, he is such a soft touch on the private sector? Will he also explain why he has given the British Oxygen Company a monopoly in the supply of oxygen to the NHS at a 20 per cent. profit and why he has allowed drug companies a 21 per cent. profit when the Committee of Public Accounts has said that it should be no more than 15 per cent.? Why has he given Kneels of Exeter, a private cleaning company—
    Mr. Speaker: Order. It is very unusual for right hon. and hon. Members to go so wide of the mark in social services questions, but that question is very wide of the mark.
    Mr. Meacher: May I say to you, Mr. Speaker—
    Hon. Members: No.
    Mr. Speaker: Order. I must tell the hon. Gentleman and the House that it is very unfair if we do not stick to the question. This question relates to meetings with trade union representatives in the National Health Service.
    Mr. Meacher: May I say, Mr. Speaker, that we are talking about wage-cutting, which affects trade unionists, while increased profits are being given to the private sector?

    129
    Will the Secretary of State explain why he has given that contract to Kneels, a private cleaning company, when the NHS in-house tender was £50,000 cheaper? Is it not clear that his real interest lies in the commercialisation of the NHS and increased profit-taking from it?
    Mr. Fowler: That is a typically absurd series of questions—[HON. MEMBERS: "Answer."] I shall answer. My interest is the welfare of patients in the Health Service. I am not interested in vested interests, which the hon. Gentleman persists in representing in the House. If money can be saved by competitive tendering, that money can be diverted to direct patient care. That is a sensible policy. My right hon. and learned Friend the Minister for Health has made a long and detailed statement about the laundry service in Cornwall. That was an entirely sensible statement to make. I deeply deplore the hon. Gentleman's absurd assumption that no economies can be made in the Health Service.

    Health and Prescription Charges
    Mr. Winnickasked the Secretary of State for Social Services what representations he has received following his recent statement on increased health and prescription charges.
    Mr. Kenneth Clarke: I have received 29 letters from hon. Members, 46 letters from members of the public and five letters from professional bodies and other organisations about the charges announced on 8 March.
    Mr. Winnick: What possible justification can there have been for the increase of 700 per cent. in prescription charges since the Tories came into office and in maximum dental charges from £30 to £110? When will the Secretary of State — a member of the Cabinet — have enough gumption and courage to stand up to the constant demands of the Treasury over these matters?
    Mr. Clarke: Because we believe that those who can afford to pay, and only those who can afford to pay, are prepared to make a reasonable contribution towards the cost of this treatment. If one does not raise a reasonable contribution, one gives up revenue which could be well spent within the NHS. The figures quoted by the hon. Gentleman reflect the fact that, for electoral reasons, the then Labour Government depressed the charges in the run-up to the general election. In fact, the proportion of total NHS spending now found out of charges is considerably less than was usual in the 1960s under successive Governments.
    Mr. Dickens: Is it not a fact that those in need do not have to pay for prescriptions, and that 70 per cent. of all prescriptions are dispensed at no cost?
    Mr. Clarke: Absolutely. I am grateful to my hon. Friend for making that elementary point. The Government have no intention of changing the present exemptions from prescription charges. The figure quoted by my hon. Friend shows how completely we protect those who might otherwise have difficulty in paying.
    Mr. Pavitt: Is the Minister not ashamed of the fact that, by raising the cost of pre-payment season tickets to £24 a year, he is taking £10 million from those who are permanently sick and whose illnesses are most acute? If he needs his pound of flesh, will he at least accept that it
    130
    is an outrage that females who have had a breast amputated and, therefore, will be on chemotherapy for 20 years, will probably be paying £24 a year?
    Mr. Clarke: Season ticket charges are paid only by those patients who are able to pay. We are protecting exactly the same exemptions as those protected by the Labour Government. We have not changed the policy on exemptions. We are raising not a pound of flesh, but a sensible contribution towards the growing amount of expenditure that the Government are sanctioning on the NHS.
    Mr. Couchman: Will my right hon. and learned Friend confirm that, even where prescription charges are payable, they barely cover a quarter of the true costs of the drugs prescribed?
    Mr. Clarke: Yes, indeed I can.
    Mr. Meacher: Is the Minister aware that on 28 April 1979, the Prime Minister said that Labour claims that the Tory Government would increase prescription charges were a lie? Will he therefore explain how prescription charges have now been increased by 800 per cent. —[HON. MEMBERS: "700."]—since this Government came to power? Is not this latest increase—three times greater than the rate of inflation— a fundamental tax on the sick? Is it not indicative of the Government's values that in one week the Chancellor gives away £360 million to the very rich through the abolition of the investment income surcharge and in the next week the Secretary of State increases prescription charges to the sick by £37 million?
    Mr. Clarke: The hon. Gentleman has a marvellous way with figures, but I have never known them go up quite so quickly as that, even in his presentation of the case. In 1979, my right hon. Friend the Prime Minister pledged that we would not introduce any new form of charge. The Labour party was then claiming that we would introduce charges for going to the doctor as well as hotel charges for hospitals. My right hon. Friend denied that, gave a promise, and we have stuck to it. We are applying a sensible policy which will raise valuable revenue for an improved NHS.

    Local Community Hospitals
    Mr. Jesselasked the Secretary of State for Social Services what value the Government attach to the work of local community hospitals.
    Mr. John Patten: We value highly the important contribution made by community hospitals to the National Health Service. Their place in the pattern of district services is primarily a matter for health authorities to decide in consultation with others concerned at local level.
    Mr. Jessel: Is my hon. Friend aware of the feeling of relief in Teddington, where next Sunday a thanksgiving service is to be held following the strong recommendation of my right hon. Friend the Secretary of State that Teddington memorial hospital should be saved? Is he also aware that that feeling contrasts deeply with the feeling in Twickenham, only a mile to the north, about the future of St. John's hospital which, like every community hospital, gives valuable service? Will my hon. Friend listen carefully to the strong representations that will be made about that
    Mr. Patten: It is not often that we have church services held for us. We are grateful for that and for my hon. Friend's kind words. No one could have worked harder or more effectively for his constituents, and for the interests of the Teddington memorial hospital. The other matter is one for the future.
    Mr. Rathbone: Does my hon. Friend agree that the use and value of these hospitals is reflected in what communities do to support them, as well as in the way communities use them?
    Mr. Patten: My hon. Friend is right. It is important to remember that community hospitals — those with 50 beds or fewer—form about 20 per cent. of hospitals in the country, and many of those are greatly helped by leagues of friends, voluntary organisations and individuals.
    Mr. Madden: Does the Minister appreciate that the feeling of thanksgiving would also spread to Bradford if he made an announcement that Thornton view hospital, which has been occupied since last August, will be saved? When will he make a statement and can he tell us the substance of that statement?
    Mr. Patten: The Thornton view hospital is not commonly thought of as a community hospital. The matter is under consideration and an announcement will be made in due course.

    Mental Health Act 1982
    Mr. Proctorasked the Secretary of State for Social Services whether he is satisified with the operation of the Mental Health Act 1982; and if he will make a statement.
    Mr. Kenneth Clarke: The Mental Health (Amendment) Act 1982 was consolidated with the 1959 Act into the Mental Health Act 1983, almost all of which was implemented satisfactorily on 30 September last year. I am very pleased with the bringing into operation of the provisions of the legislation so far.
    Mr. Proctor: Is my right hon. and learned Friend satisfied with the speed with which mental health review tribunal hearings are taking place?
    Mr. Clarke: I am glad to say that I am, and, in particular, section 2 applications are being dealt with within the statutory time limit that was laid down.
    Mr. Meadowcroft: Has the Minister received any representation regarding the use of electro-convulsive therapy under the Act, and is he directing the mental health commissioners to have regard to the strict validity of the detention of a patient without informed consent when receiving such therapy?
    Mr. Clarke: When the Act was considered by Parliament last year, a number of forms of treatment were made subject to the second opinion of an independent doctor. The commission is now arranging those second opinions, and I am glad to say that that part of the Act is working very well in practice. We have no intention of redrawing the lines laid down in recent legislation covering different forms of treatment, although we shall consider the advice of the commission on all these matters in due course.

    Association of Professionalal Ambulance Personnel
    Mr. Robert Atkinsasked the Secretary of State for Social Services if he will make a statement on the progress on health authority recognition for negotiating purposes of the Association of Professional Ambulance Personnel.
    Mr. Kenneth Clarke: Local recognition is in the first instance a matter for the health authorities concerned, but in my view they should recognise trades unions whose membership comprise a significant proportion of the relevant group of staff, and I have written to several chairmen of these lines. To date only one authority has recognised this association, but I expect others to do so. I am glad to say that 14 authorities in England have now granted the Association of Professional Ambulance Personnel the facility for trades union subscriptions to be deducted at source.
    Mr. Atkins: Is it not a disgrace that this association is being rejected by the Preston district health authority, acting on behalf of the Lancashire health authorities, and that trade unions such as the National Union of Public Employees, the Confederation of Health Service Employees, the General, Municipal, Boilermakers and Allied Trades Union and the Transport and General Workers Union are refusing to sit down and discuss this problem? Is my right hon. and learned Friend aware that these organisations are refusing to acknowledge the existence of the APAP and will boycott it and take industrial action if it is recognised? What is his department going to do about this?
    Mr. Clarke: As I understand it, APAP is now the largest single union in the Lancashire ambulance service and I made it clear to the chairmen of the health authorities that I expected the union to be given recognition if it holds the confidence of the staff. It is up to the staff to decide which organisations it wishes to represent them, and that should be the deciding factor in all this.
    Mr. Parry: Does the Minister agree that there is a sufficient number of unions on the Whitley council and that the recognition of other organisations will add to the problems of the collective bargaining process?
    Mr. Clarke: It is up to those who work for health authorities to decide which unions they wish to join. The Whitley structure cannot be frozen for all time if it transpires that a significant number of staff want to be represented by another organisation. The Government and the employers are wholly neutral and the chairmen have been addvised to be guided by the wishes of their staff.

    Leptospirosis
    Mr. Colin Shepherdasked the Secretary of State for Social Services how many people were treated for cattle-attributed leptospirosis in the National Health Service in the last year for which figures are available; and what proportion was diagnosed by general practitioners.
    Mr. John Patten: This information is not available centrally. In 1983, 40 cases of this disease were notified from England and Wales to the communicable disease surveillance centre.
    Mr. Shepherd: I am grateful to my hon. Friend for that answer. Now that brucellosis has been cleared from the

    133
    scene, does he agree that the extent of leptospirosis is becoming more apparent, especially to those who work in the dairy industry? Does he accept that the more general practitioners are aware of the disease the more they are recognising it and diagnosing it? What steps will he take to ensure that it is made more widely known among GPs? What is his assessment of the danger to public health?
    Mr. Patten: The danger to public health is limited. There were 40 cases of leptospirosis last year, 12 cases the year before that and 10 the year before that. I am generally satisfied that GPs have an adequate knowledge of the risks of the disease, especially in dairying areas. It is very important for those engaged in health education to make it clear to those who work in the dairy industry that there is a need to wear adequate protective clothing and to take proper protective measures. We are grateful to the reference unit, which is in my hon. Friend's constituency in Hereford, for the work which it has undertaken.

    Organ Transplants
    Mr. Traceyasked the Secretary of State for Social Services what recent representations he has received about a system of opting out for donation of organs for transplant.
    Mr. Fowler: Since this subject was debated in the House on 13 February we have received letters about it from 24 hon. Members, mostly forwarding correspondence from their constituents or others, and about 30 other people.
    Mr. Tracey: Is my right hon. Friend aware of the opinion poll commissioned by the BBC's "That's Life" programme, which revealed that 71 per cent. of those questioned said that they favoured an opting-out scheme? Notwithstanding that opinion poll result, there is a substantial body of opinion that is still against opting out, including doctors. Will he consider an official inquiry before any steps are taken?
    Mr. Fowler: We shall examine this issue extremely carefully. As I said when I was last asked a question on the matter, I think that there is more prospect of an opting-in system than an opting-out system. I am sure that my hon. Friend will be pleased to know that, following the launch of the donor card system, in the five weeks from 13 February to 19 March there were 173 transplant operations compared with only 103 in the same period in 1983.

    Parallel Imports
    Mr. Campbell-Savoursasked the Secretary of State for Social Services what representations he has received from the British Medical Association on parallel imports.
    Mr. Kenneth Clarke: The British Medical Association has replied to our consultation document on parallel imports, giving a general welcome to our proposals. It has made a number of detailed comments, which are being considered carefully along with the others that we have received.
    Mr. Campbell-Savours: Is true that prescription-only drugs are available from parallel importers without prescriptions? What is the Government's response to the
    134
    ABPI suggestion to its members that it should not cooperate with the Government in evaluating the hazards of parallel imports?
    Mr. Clarke: There have been some worrying newspaper reports suggesting that some importers will supply through the post drugs to those who apply for them without checking whether they are qualified pharmacists. It is illegal to distribute drugs in that way and the Government will expect the law to be enforced. I have no evidence of the Association of British Pharmaceutical Industries withdrawing any co-operation from the Government. They have given us their representations, along with others, on parallel importing and we hope to produce our final proposals as soon as possible.
    Sir Dudley Smith: Is my right hon. and learned Friend aware that it is nothing short of immoral that some pharmacists are importing cheap foreign drugs and selling them to the NHS at full British prices? What does he intend to do about this?
    Mr. Clarke: We have issued a consultation document, which shows that we shall close a loophole that has appeared in the present regulations, which allows large quantities of drugs to be imported without a licence. At the same time, we shall set up a proper licensing arrangement for imports from the EC. The consultations have thrown up many conflicting detailed points, but we realise the urgency of the matter and hope to sort it out as quickly as possible.
    Mr. Ashley: When the Minister speaks of cheap foreign goods, he refers to drugs that are produced in Britain and exported cheaply. Is he aware that the British pharmaceutical industry is damaging the National Health Service by charging it higher prices than it charges comparable health services in Europe? The Health Service should use parallel imports at lower prices, provided that the DHSS exercises quality control. Can the Minister confirm that the pharmaceutical industry has refused to cooperate with quality control?
    Mr. Clarke: The reason for such movements is that different countries have differing systems for setting drug prices, which means that certain drugs may be cheaper in some countries at different times. Changes in exchange rates may also affect prices and good entrepreneurs can buy drugs more cheaply abroad and import them into this country in competition with the identical drugs produced here; it works both ways. Recently, Britain was a major source of parallel imports to EEC countries because the drugs could be bought more cheaply here. We have negotiated a fair price arrangement with the pharmaceutical industry, which saves the National Health Service £100 million a year. It is completely untrue that any sector of the pharmaceutical industry is refusing to co-operate with the Government on safety.
    Mr. Nicholas Winterton: Will my right hon. and learned Friend confirm that some drugs coming to Britain through parallel importing are not as safe as British proprietary brands, yet imported drugs are dispensed by chemists as if they were proprietary drugs? Could not such a practice put at risk the health of those relying on dispensing pharmacists to give them a drug that will work in the way required by the prescribing doctor?
    Mr. Clarke: That is our major concern. Although we have no evidence at present of patients being injured by

    135
    imported drugs, we need to eliminate that risk. Where the drugs involved are the same, we must be sure how they have been handled, where they came from, that individual batches can be checked back and that instructions are given in English for English patients. We are working rapidly to solve those problems.
    Mr. Dobson: Will the Minister confirm that the reason why British pharmacists find it cheaper to buy drugs abroad is that drugs are cheaper in western Europe because western European Governments have forced their pharmaceutical industries to keep down drug prices? Is it not time that the British Government followed suit?
    Mr. Clarke: That is far too simplistic an analysis. For the reasons that I gave, some drugs will sometimes be cheaper in western Europe than in Britain, and at other times drugs will be cheaper here. That is because people are playing the market. The Government are concerned, however, with patient safety. As I told my hon. Friend the Member for Warwick and Leamington (Sir D. Smith), we hope to produce a workable system to bring us a supply of drugs at a fair and competitive price, while protecting people against drugs that have not been handled properly.

    Hospital Closures
    Mr. Chapmanasked the Secretary of State for Social Services how many hospitals were closed upon the decision of the Secretary of State between May 1979 and March 1984; and what were the comparable figures for the period from March 1974 to May 1979.
    Mr. Fowler: Between May 1979 and December 1983 there have been 159 whole closures of hospitals, which compares with a figure of 270 whole closures under the last Labour Government. Of those closures, the numbers approved by Ministers were 32 and 35 respectively.
    Mr. Chapman: I thank my right hon. Friend for that information. Is he aware that many people listening to Labour propaganda will be surprised to learn that the Labour Administration closed down many hospitals, and even more surprised that that Government closed down almost twice as many hospitals as the Conservative Government in an equivalent period?
    Mr. Fowler: My hon. Friend is absolutely right. The Labour Government carried out the biggest capital cut in the history of the National Health Service. From 1976–77 to 1977–78 capital spending was reduced from £356 million to £314 million, which was a cut of £160 million in real terms.
    Mr. Ron Lewis: Can the Minister advise the House of the number of his next planted question?
    Mr. Fowler: I am sorry that we should have caught the hon. Gentleman on such a sore point. I repeat that those figures on capital spending inside the Health Service deserve to be better known.
    Mr. Alexander: Can my right hon. Friend tell the House whether any of the hospitals closed were listed buildings and, if so, their likely use in future?
    Mr. Fowler: Not without notice. I shall consider the matter and write to my hon. Friend.
    Mr. Norman Atkinson: If the Secretary of State wanted a planted question, should he not have got the
    136
    Opposition to ask it, because the net loss of beds under his Administration is far greater than it was under the Labour Government?
    Mr. Fowler: That is not so. If we wanted planted questions, we already have the Leader of the Opposition.
    Later—
    Mr. Chapman: On a point of order, Mr. Speaker. It was alleged earlier that I planted question No. 14. Will you rule that, if that is on the record, I am entitled to deny it? Do you agree—it is well known to hon. Members, not least the hon. Member for Carlisle (Mr. Lewis)—that the only things I am guilty of planting are trees?
    Mr. Speaker: The planting of questions is a colloquialism which is unknown to me.

    Supplementary Benefit
    Mr. Phillip Oppenheimasked the Secretary of State for Social Services what is the average length of time between a person registering a claim for supplementary benefit and a decision being reached on that claim in the latest year for which figures are available.
    The Minister for Social Security (Dr. Rhodes Boyson): In the year ending 14 February 1984 it was five days.
    Mr. Oppenheim: Is my hon. Friend aware that the decision on the claim of my constituent, Mr. Allan took no less than four months, causing him much hardship? Although I accept that that is in no way typical, is not that an unacceptable length of time for making a decision on such a claim?
    Dr. Boyson: I appreciate my hon. Friend's concern. I have already written to him about this case. If there are any further points that he would like to bring to my attention, I should be glad to receive them. The average time for supplementary benefit claims to be decided in the various offices in his constituency is between three and seven days.

  PRIME MINISTER

    Engagements
    Ql. Mr. Terry Lewisasked the Prime Minister if she will list her official engagements for Tuesday 27 March.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. I also attended the memorial service for our late colleague Maurice Macmillan at St. Margaret 's, Westminster. In addition to my duties in the House] shall be having further meetings later today.
    Mr. Lewis: The savage sentence meted out to Miss Tisdall contrasts sharply with the establishment—[HON.MEMBERS: "Question."]
    Mr. Speaker: Order. I must stop the hon. Gentleman. He must be aware that this case is sub judice. Mrs. Knight.
    Mr. Lewis rose——
    Mrs. Jill Knight: In between her engagements today, can my right hon. Friend spare a moment to consider whether it might—[Interruption.]
    Mr. Lewis rose——
    Mr. Speaker: Order. In fairness, I shall give the hon. Gentleman another chance to complete his original question.
    Mr. Lewis rose—
    Mr. Speaker: Order. The hon. Gentleman may complete his question in a moment. I have just called Mrs. Knight.
    Mrs. Knight: In between her engagements today, will my right hon. Friend consider whether it might be possible to divert the attention of Mr. Arthur Scargill from the business of investing hundreds of millions of pounds' worth of funds to the best possible commercial advantage to the fact that the miners' strike will put people out of work if they are not careful?
    The Prime Minister: I believe that my hon. Friend is referring to problems at certain foundries that are short of coke; Scunthorpe has not enough for steel making. Scunthorpe has made strenuous efforts to get its steel output up to a high quality and to sell it at a very competitive price. The jobs of some of those people would be at stake. They have worked extremely hard. It would be ironic if as a result of the strike people were made unemployed, as customers would go overseas for steel and the products of foundries, and their custom, would never return.
    Mr. Terry Lewis rose——
    Mr. Speaker: Order. I ask the hon. Member for Worsley (Mr. Lewis) to take care in framing his supplementary question.
    Mr. Lewis: Does the Prime Minister agree that the time has arrived when sentencing policy should be reviewed in terms of cases that affect national security compared with those that do not?
    The Prime Minister: No, Sir. Sentencing is a matter for the courts. The hon. Gentleman will be aware that in certain cases we are proposing next year to introduce a right of appeal against a sentence, but it would not apply to the particular case. It would apply only where it was thought that a sentence was unduly low and would be guidance for the future.

    Local Authority Services (Privatisation)
    Mr. David Atkinsonasked the Prime Minister if she is satisfied with the progress being made by local authorities to privatise services.
    The Prime Minister: No. I am still dissatisfied with the progress that local authorities are making in seeking better value for money by putting their services to the test of competition. We are continuing to study what measures can be taken to speed up the process.
    Mr. Atkinson: I welcome that reply from my right hon. Friend. Does she agree that there is now ample evidence from those Conservative councils that have had the guts and the vision to put out their services to private enterprise that that is the most positive way of capping rates? Will my right hon. Friend consider introducing legislation that will oblige all local authorities to compare existing costs for those services with the costs if they are tendered to the private sector?
    The Prime Minister: I agree with my hon. Friend that there are great opportunities for reducing expenditure by
    138
    submitting contracts to private competition. So far, progress has been very disappointing. Only 23 contracts have been let, but they result in a saving of £7 million annually. I hope that we can be much more successful in persuading local authorities to go out to private competition, but I should be reluctant to commit us to legislation, because that would be a very technical measure to put through the House.
    Miss Maynard: Is the Prime Minister aware that there is great anxiety that the Territorial Army will be increased to 86,000—
    Mr. Speaker: Order. The question concerns privatisation.

    Engagements
    Mr. Blairasked the Prime Minister if she will list her official engagements for Tuesday 27 March.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Blair: When people can be imprisoned for six months for, in effect, telling the British public what the Government should have told them, does the right hon. Lady not agree that there is an urgent need for legislation so that, while the interests of our national security are protected, the Government cannot conceal the scale of what they are doing from the British public and Parliament?
    The Prime Minister: No. I do not believe that any Government can carry on their business unless they can trust those in the Civil Service who have charge of secret documents to keep those documents to themselves.
    Mr. Ashby: Did my right hon. Friend read in the Leicester Mercury the report of Mr. Jack Jones, who said:
    "We are not violent men but we will not be intimidated. We have voted to work and even if we"—[HON.MEMBERS: "Reading."]
    Mr. Speaker: Order. The hon. Member must not read.
    Mr. Ashby: Mr. Jones said:
    "even if"——[Interruption.]
    Mr. Speaker: Did the Prime Minister hear that question? If this type of baying goes on, neither the Prime Minister nor I will be able to hear the question. Will the hon. Member please repeat his question.
    Mr. Ashby: Did my right hon. Friend read the report of the leader of the miners in Leicestershire, Mr. Jack Jones, who said:
    "We are not violent men but we will not be intimidated."[HON. MEMBERS: "Reading."]
    Mr. Speaker: Order. The hon. Member must not read.
    Mr. Ashby:
    "We have voted to work and even if we are operating the last 4 holes in the country, we will work."
    The Prime Minister: I am not sure that I could hear all of that question precisely. The Conservative party is totally and utterly against intimidation of people who are trying to go about their law-abiding business normally. We believe that the police are doing a superb job enabling those people to get through to their place of work.
    Mr. Tim Smithasked the Prime Minister if she will list her official engagements for Tuesday 27 March.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Smith: Is my right hon. Friend aware of the disgraceful campaign being conducted by the GLC against its abolition?—[Interruption.]
    Mr. Speaker: Order. This type of behaviour is very unseemly.
    Mr. Smith: That campaign includes threats amounting to blackmail of its suppliers, including my constituents. Will my right hon. Friend confirm that she remains determined to abolish the GLC and the metropolitan counties?
    The Prime Minister: Yes, the Greater London council and the metropolitan counties will be abolished in accordance with the provisions in our manifesto. A paving Bill will be introduced in the House shortly.
    Mr. Kinnock: In his negotiations in Brussels today, has the Foreign Secretary been given instructions to ensure that any agreement that he makes will contain provision for rebates to the United Kingdom that are sufficient to offset the additional £675 million contribution that will arise if our own resource subscriptions were to increase from 1 to 1·4 per cent.?
    The Prime Minister: He is instructed, if I might use —[Interruption.] My right hon. and learned Friend is under the same instructions as I impose upon myself. The Foreign Secretary would, of course, refer back if there were to be a change.
    Mr. Onslow: Does my right hon. Friend think that any Government could carry on their business effectively if the Official Secrets Act 1911 were so amended as to legalise the wilful betrayal of trust by civil servants? Could not a civil servant of any grade who supposes himself or herself to be the victim of a conflict of loyalties ask to be transferred to non-controversial work or resign from the service?
    The Prime Minister: Yes. I wholly agree with my hon. Friend. I note that when the matter came up during the lifetime of the previous Labour Government, in June 1976, the then Prime Minister said:
    "There must be absolute confidence that papers and discussions that take place are kept within the circle to whom they are given."
    I note that the then Leader of the Opposition said:
    "Is the Prime Minister aware that we fully share his view about the gravity of this matter? It is essential that confidentiality of discussions and documents should be assured."—[Official Report, 17 June 1976; Vol. 913, c. 738–39.]
    The then Prime Minister was right, and I was right to support him.
    Mr. Winnick: How can the Prime Minister possibly justify the all-embracing section 2 of the Official Secrets Act, which was described by the present Home Secretary
    140
    six years ago as indefensible? Do a Government who have shown such contempt for civil liberties welcome such a section to deal with all those who happen to displease them?
    The Prime Minister: The Franks report on the Official Secrets Act was published in 1972. The Labour Government held office from 1974 until 1979. During those five years they could have introduced legislation, but they did not. In 1979 we introduced legislation which did not find favour with the House. We have no intention at present of introducing further legislation.
    Mr. Leigh: Is my right hon. Friend aware that an internal CND document—[HON. MEMBERS: "Leak."]—on cruise, just published, instructs CND members to render the deployment of cruise missiles militarily useless by informing the world, including our enemies, of exactly where they are sited? Does my right hon. Friend agree that that confirms the impression of many Conservative Members that Lenin's willing dupes in the CND are now doing the Soviet's dirty work for them?
    The Prime Minister: That is correct. They are making a fundamental attack on the defence, security and liberties of our country, including the liberties that enable them to have freedom of speech and demonstration.
    Mr. Beith: Would not the country be far better governed if freedom of information legislation protected those areas that should be in the public domain and left the apparatus of the law to protect far fewer secrets?
    The Prime Minister: We try to keep protection to such matters as are vital. The hon. Gentleman must understand that it is vital to keep certain matters confidential for security reasons and certain negotiations confidential for commercial reasons.
    Mr. Heddle: I refer to my right hon. Friend's answer to Question No. 2. Has she yet read the Audit Commission's report, which shows that local authorities have amassed £250 million in rent arrears? Does she agree that that is a classic case for putting out, at least to the voluntary housing movement, the collection of rent and the housing management function?
    The Prime Minister: I agree with my hon. Friend that it would be possible to put the collection out to the private sector, possibly with profit to the public sector.
    Mr. Frank Cook: Will the Prime Minister take this opportunity to make a clear and unequivocal statement of support for the principle that the wishes of the Clevelanders must be paramount?
    The Prime Minister: I make a clear and unequivocal statement of support for the manifesto upon which the Conservative party fought the general election.

Matrimonial and Family Proceedings Bill
3.32 pm
Mr. Merlyn Rees: On a point of order, Mr. Speaker. I wish to inform you and the House of a matter of concern to me as Chairman of the Special Standing Committee set up to take evidence under the Matrimonial and Family Proceedings Bill, and to seek your advice. The matter gives rise to a complaint against someone in the Lord Chancellor's Department.
On Friday 23 March 1984 the Hansard printers stopped printing the report of our sitting on Thursday 22 March as a result of the "instructions" of someone from the Lord Chancellor's Department. This is a serious matter. On Thursday valuable evidence, both written and oral, was given to the Committee by Lord Scarman and Sir John Arnold of the Family Division, which was to be published.
The first I knew of the matter was from a letter given to me this morning addressed to the Clerk to our Committee from Mr. Morgan, the Editor of the Official Report. He wrote:
"My attention has been called to the half report of the Third Sitting of your Committee on 22nd March. This half report was made available, I understand, as a result of pressure from the Lord Chancellor's Department late on Thursday. The full version was not available until today.
As a result of this episode I have directed the printers in no circumstances to repeat this exercise and to take instructions on the publication of Standing Committee reports only from my office. To proceed otherwise is a recipe for disaster."
It is not easy these days for a printer—in this case a subcontractor — if he receives a call from the Lord Chancellor's Department. One never knows who is telephoning him about events. During our Sitting there was some conflict between what the Lord Chancellor said, I understand in another place, and what the President of the Family Division reported to the Committee on Thursday. It was requested that it be cleared up at ministerial level so that the report could be sent to Sir John Arnold to resolve the conflict. I am given to understand that the printer received the request and, because it could not be carried out without stopping printing, he stopped printing without anyone telling him that he must stop printing. However it happened, we had only a half copy of the Official Report. It never reached the Vote Office and today we received the full report.
Government Whips and Ministers have co-operated with me, but I am worried that somebody in the Lord Chancellor's Department, with whatever intention, should contact the printer direct, not through Hansard. The nature of the Special Standing Committee procedure is such that we depend on evidence—and people outside the House as well as right hon. and hon. Members want to read the evidence. It is an excellent procedure, but all Government Departments must be told that they do not control
142
Hansard. The Hansard printers are responsible to this House and to no one else. I ask for your advice, Mr. Speaker.
Mr. Speaker: The right hon. Gentleman raises a very important matter. As the Solicitor-General is present, I think that he should say something.
The Solicitor-General (Sir Patrick Mayhew): I am grateful to you, Mr. Speaker. It may help if I tell the House the result of the inquiries that I have made.
Last Thursday, evidence was given to the Special Standing Committee by the President of the Family Division, as the right hon. Member for Morley and Leeds, South (Mr. Rees) has said. A later witness on the same day told the Committee that there was a disparity on a particular issue between the President's evidence and a speech made in another place by the Lord Chancellor expressing an opinion.
The President had already undertaken to submit a further written memorandum to the Committee in any event, as the right hon. Gentleman said. So that the matter could be dealt with by the President in the course of that memorandum and received by the Committee in time for its final sitting today, I asked that a copy of Thursday's Hansard be obtained as soon as possible and that the President be invited to refer to the relevant passage in his evidence and to deal with the point made by the witness to whom I have referred.
Accordingly, I understand that on Friday morning an official of the Lord Chancellor's Department spoke by telephone to an official of St. Stephen's Press, printers to Hansard, to inquire when copies of Thursday's report would be available. On being told that the report would probably be available at about 6 pm on Friday, he asked whether it would be possible to obtain sooner a proof copy of the transcript of the President's evidence.
The printer's official undertook to try to obtain proof copies from the subcontractors and in fact by 12 noon sent copies to the Lord Chancellor's Department official. No instruction and no request was at any time made for the publication of Thursday's report to be divided or delayed in any way. Nor, I understand, was it suggested to the Lord Chancellor's official that either would occur. In the event, the President was enabled to deal with the matter in a supplementary memorandum which the Committee had before it at its final sitting this morning.
I am sorry that an initiative of mine, taken solely in the interest of putting the fullest information before the Special Standing Committee before its final meeting, seems inadvertently to have led to some unauthorised delay in the printing of Hansard, but this was not requested, intended or foreseen.
Mr. Speaker: I am sure that the House will accept the explanation given by the Solicitor-General. I will, of course, look into the matter and ensure that nothing of this kind happens again.

Statutory Instruments, &c
Mr. Speaker: With the leave of the House, I will put together the three motions relating to statutory
instruments.
Ordered,
That the draft General Practice Finance Corporation (Increase of Borrowing Powers) Order 1984 be referred to a Standing Committee on Statutory Instruments, &c.
That the draft Administration of Estates (Small Payments) (Increase of Limit) Order 1984 be referred to a Standing Committee on Statutory Instruments, &c.
That the Block Grant (Education Adjustments) (England) Regulations 1984 (S.I., 1984, No. 224) be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Neubert.]

European Community Documents
Mr. Speaker: With the leave of the House, I will put together the two motions relating to European Community documents.
Ordered,
That European Community Document No. 7933/83 concerning the Community Road Haulage quota be referred to a Standing Committee on European Community documents.
That European Community Document No. 8307/83 concerning the reduction in noise from motor vehicles be referred to a Standing Committee on European Community documents. —[Mr. Neubert.]

Select Committee on Members' Interests
3.39 pm
Mr. Brian Sedgemore: On a point of order, Mr. Speaker. It goes to the heart of the integrity of this House.
You will be aware, Mr. Speaker, that it is a convention that when Select Committees report to the House, unless there are reasons of security or confidentiality, they usually publish the evidence that has been submitted to them, and they certainly do so in cases where not to do so would render the main report incomprehensible and meaningless. You will also be aware, Mr. Speaker, that it is not the practice of Select Committees to suppress evidence given to them on a party political basis in order to protect one or more Members of the House from having their conduct made public. If that were to happen, clearly the Select Committee would be showing bias and the odour of political corruption would hang heavily in the air.
Yesterday, the Select Committee on Members' Interests reported on a submission in relation to the Prime Minister's conduct in Oman. It is impossible for the public to read and understand that report because none of the evidence which was given to it was published. The submission which the Committee dealt with was not the submission which I made, and I want to ask you, Mr. Speaker, how you can protect the good name and integrity of the House from a Select Committee which, in my submission, has acted with grave irresponsibility.
Sir Geoffrey Finsberg: On a point of order, Mr. Speaker. Is it not a fact that the way to protect the House is the way the Select Committee seems to have pursued — by not wishing to publish rubbish from the gutter?
Mr. Sedgemore: Further to that point of order, Mr. Speaker. It is important that the House should consider exactly where it stands in relation to this matter, particularly in view of the remarks made by the hon. Member for Hampstead and Highgate (Sir G. Finsberg). All that has happened is that a list of facts, 15 in number, has been submitted to the Select Committee, together with a list of witnesses who can speak to those facts. It was up to the Select Committee to decide whether to call those witnesses. To refer to facts backed up by witnesses as rubbish is an insult to the good name of the House.
Mr. Speaker: Nevertheless, it is for the Select Committee itself to decide what it publishes. It is not a matter for me.

Local Authority (Standards of Service)
3.41 pm
Mr. Nicholas Brown: I beg to move,
That leave be given to bring in a Bill to provide for the maintenance of standards of service where local athorities place public services out to competitive tender.
The Bill does not seek to deal with the issues of principle involved in the privatisation argument. Its narrow purpose is to enable local authorities and other public sector authorities to deal with a range of practices which I am sure the whole House would consider unacceptable. It is, for example, clearly unfair that a reputable private sector builder who adheres to nationally agreed terms and conditions of employment should fail to win work in competitive tender because he is undercut by an unscrupulous rival exploiting high unemployment by wage-cutting and the use of the black economy.
To continue the same example, it surely cannot be acceptable to any Member of the House that Government youth employment schemes should be used to enable private sector contractors to reduce the wage element in their tender. Not only is it obviously unfair to other contractors and exploitation of the young people themselves, but it can be downright dangerous. I think in particular of a recent example in Newcastle where an electrical contractor was caught using youngsters on a job creation scheme to rewire council houses. No credit is due to the supervision of the housing department in Newcastle. It did not catch the contractor. He was caught by local tenants worried about going back to their houses when the work was finished and by an official of the EEPTU whom they contacted to have a look at the job. The purpose of my Bill is to outlaw that sort of conduct.
Breaches of the Health and Safety at Work etc. Act can also lead to unfair competition. The contractor who puts up scaffolding, catwalks and hoists to a roof is clearly at a tremendous price disadvatage if he is competing with a contractor who sends his men up an unfooted ladder to walk along the roof, perhaps breaking up the lats—but of course that would not be found out until later—and throw the broken tiles off the roof. He saves money on the hoist and it is clearly quicker, but it is bad luck on anyone standing underneath. The House must be concerned with the protection of the whole of our society and not just with the narrow issue of getting the job done as quickly as possible.
One of my constituents in Shieldfield was recently surprised when a painter came in through her double-glazed windows feet first. Since she lives at the top of a high-rise block of flats, the visit was something of a surprise. The painter was working for a private contractor and his hoist had given way. The only way to save his life
146
was to jump through the window. But why was the equipment not properly checked, and why was he not wearing a personal safety harness? It is the duty of public authorities to take these matters into consideration when awarding tenders.
Equally, it is my view and that of my supporters that ratepayers must be protected against price rings. Where there is a reasonable suspicion that a public authority is not getting competitive prices but is being held to ransom, that authority should have the power to use its own direct labour force to ensure competitiveness. This point applies particularly to work where the labour cost is the main price element in the total cost.
The Bill will place a more exacting requirement on public authorities to take reasonable steps to satisfy themselves that contractors are financially sound. An authority must satisfy itself that a contractor has the financial backing to sustain the work for which he has contracted. If the contractor collapses halfway through the contract, the taxpayer inevitably receives the costly bill. It is our purpose to outlaw unacceptable working practices that endanger the quality of the work or the safety and welfare of the work force or general public.
There are two other related matters. The first is a minor provision to require public authorities to take into account the administrative cost to the authorities when considering where to place contracts, and that especially applies to minor works. The second relates directly to the day-to-day maintenance of public sector housing.
The Bill will place a duty on a housing authority to make provision for a direct interface between the officer responsible for managing the housing stock and the building contractor. That would be quite separate from the emergency procedures. It is intended to enable the housing authority, as landlord, to obtain a swift response to a particular repair, even if it would not usually be classed as an emergency.
I hope that hon. Members will welcome the Bill because it is intended to be of assistance to private business, ratepayers, council tenants and public authorities alike.
Question put and agreed to.
Bill ordered to be brought in by Mr. Nicholas Brown, Mr. Tony Blair, Mr. Gordon Brown, Mr. Harry Cowans, Mr. Allan Roberts, Mr. Chris Smith and Mr. Jack Thompson.

LOCAL AUTHORITY (STANDARDS OF SERVICE)
Mr. Nicholas Brown accordingly presented a Bill to provide for the maintenance of standards of service where local authorities place public services out to competitive tender: And the same was read the First time; and ordered to be read a Second time upon 6 April and to be printed [Bill 138.]

RATES BILL (ALLOCATION OF TIME)
Ordered,
That the Report [26th March] of the Business Committee be now considered.—[Mr. Neubert.]
Report considered accordingly.
Question, That this House doth agree with the Committee in its resolution, put forthwith, pursuant to Standing Order No. 45 (Business Committee) and agreed to.
Following is the report of the Business Committee:
That—
(1) the order in which proceedings on Consideration are taken shall be new Clauses, amendments to Parts I, II and III, amendments to Schedules 1 and 2, amendments to Part IV, new Schedules.
(2) the allotted days which the Order [29th February] are given to the proceedings on Consideration and Third Reading shall be allotted in the manner shown in the Table set out below and, subject to the provisions of that Order, each part of the proceedings shall be brought to a conclusion at the time specified in the third column of that Table.

TABLE

Alotted day

Proceedings

Time for conclusion of proceedings

First day

New clauses

8 p.m.

Amendments to Part I

Midnight

Second day

Amendments to Part II

7.15 p.m.

Remaining proceedings on Consideration

8.15 p.m.

Third Reading

10 p.m.

Orders of the Day

  Rates Bill
  [1ST ALLOTTED DAY]
  As amended (in the Standing Committee), considered.

New Clause 6

  LEVELS OF EXPENDITURE
  'Where the Secretary of State has—

  (a) determined the grant related expenditure (as defined in section 56(8) of the local Government, Planning and Land Act 1980) for an authority pursuant to section 57(1) of the said Act of 1980.

  (b) issued guidance to an authority pursuant to section 59(6)(cc) of the said Act of 1980, and

  (c) determined a maximum expenditure level for an authority pursuant to this Act

  then, notwithstanding the provisions of the said Act of 1980, for the purposes of the determination of an authority's grant related expenditure, the issuing of guidance to an authority and the determination of an authority's maximum expenditure as aforesaid, the higher or highest of those figures shall be used for all three purposes.'—[Dr. Cunningham.]
  Brought up, and read the First time.
  3.48 pm
  Dr. John Cunningham: I beg to move, That the clause be read a Second time.
  I am afraid that the wording of the new clause is complicated, of necessity, but it seeks to prevent the Government from having three different systems, or three different amounts of money, under which they can control the budgets of local authorities which may be designated under the Bill.
  It is clear from what the Under-Secretary, the hon. Member for Ealing, Acton (Sir G. Young), said in Committee on 23 February, that a rate-capped authority would have a grant-related expenditure assessment, a target or expenditure guidance, as the 1982 Act put it. and an expenditure limit determined in accordance with this Bill. That statement highlighted the complexity into which this Administration have driven local government finance. The proposed new clause seeks to ensure that the highest of the three figures should be used for all purposes.
  It is important for us to discuss this issue for another reason, and that is to try to find out the Government's thinking about their intention to use three different spending norms for individual authorities. It is questionable whether a Government should set a norm for a local authority. It is doubtful whether two norms are sensible or practicable. To have three different norms for individual authorities is surely stupid in the extreme, but that is what will happen if the Bill goes ahead as it stands.
  It is important at the beginning of this Report stage to make it clear that the local authority associations remain united in their total opposition to the Bill. They made that clear in a press notice. The Association of County Councils, which is Conservative-controlled, the Association of District Councils, which is Conservative-controlled, and the Association of Metropolitan Authorities, which is Labour-controlled, speak with one voice in the press notice:
  "The Secretary of State has said nothing which would meet the criticisms of the Bill by the local authority associations. The

  149
  position therefore remains unchanged from the Second Reading. The Bill represents a massive shift towards the centralisation of local decision making by giving the Secretary of State effective power to fix expenditure and rate levels for all councils in England and Wales. The Associations remain united in their opposition to these proposals."
  The associations also remain united in their opposition to the Government's intention, conceded in Committee, that grant-related expenditure should be the central test on which they base their decisions to apply the measures contained in the Bill. That test was rejected by both previous Secretaries of State for the Environment in this Administration, and the present Secretary of State has reneged on persistent and numerous assurances given to the House and to local government on that key issue.
  Before the Local Government, Planning and Land Act 1980, Governments had not been in the business of telling individual local authorities what they should spend on services. That began to change with the introduction of the block grant system in the 1980 Act, because that required an explicit reference point for the purposes of grant distribution. Under the old needs element of RSG there was an implicit figure for a local authority's spending needs, but it was never used as a test for, or absolute norm of, what an authority should spend; nor was it used to judge its performance.
  The Committee spent many hours, including some during the night, discussing the shortcomings of GRE. The most important aspect of that to which we wish to pay attention today is the way in which all the undertakings that were given at the time of the passage of the Act and subsequently have been reneged upon. For example, writing in the Local Government Chronicle in December 1980, the present Secretary of State for Employment said of GRE that it would allow for the "inevitable degree of approximation". In a Department of the Environment document published in February 1981, referring to GRE, he wrote:
  "They are not, however, tailor-made to the circumstances of each authority. They do not set an expenditure target for authorities."
  There have been many similar references to the unsuitability of GRE for that purpose.
  Mr. Harry Cowans: Is my hon. Friend aware that the same right hon. Gentleman said in that same Department of the Environment document that for the Government to cap the rates would represent a conflict with local democracy? Is it not remarkable that we should be discussing a Bill which does exactly what the right hon. Gentleman then opposed?
  Dr. Cunningham: I agree with my hon. Friend. Even worse, in a briefing document dated 8 December 1983 circulated to his Cabinet colleagues, the right hon. Gentleman said:
  "The criteria by which we will select them"——
  referring to authorities to be controlled——
  "will have particular regard to authorities' recent levels of spending and how they vary from the objective measure of need represented by the grant-related expenditure."
  Far from accepting the objectivity of GRE, the local authority associations have made it clear that they are totally opposed to its use in that way as part of the proposals in the Bill.
  The Secretary of State went further in making it clear to the Committee that not only will GRE be the main test,
  150
  at the heart of his approach, but the local authority expenditure, not rates, will concern him principally in the application of these measures, should they have the misfortune to become law.
  The second part of the new clause deals with expenditure guidance issued by the Secretary of State under the Local Government Finance Act 1982. Expenditure guidance has been issued every year since block grant was introduced in 1981–82, although the then Secretary of. State anticipated its legality being conditional on the 1982 Act. Expenditure guidance has been enforced by massive grant penalties, and is clearly the Government's view of how much local authorities should be spending. The way of calculating the expenditure guidance has been different in each of the four years in which it has been issued. That is another measure of the uncertainty introduced into local government finance by the Government.
  There has been some reference to GRE in the calculations, but only in the first two years did the guidance represent the GRE for some councils—those councils whose calculated guidance would have been lower than the grant-related expenditure total. According to the Government's logic, targets had to be obtainable, and so it would not make sense to the Government to set GREs as targets for those authorities which were spending well above them.
  4 pm
  The other side of the coin is that there is also pressure from those authorities whose guidance is below GRE. Some Tory-controlled local authorities were in that position. The Government have had to resolve that problem because it has implications for total local authority spending and is one reason why the total of GREs is. less than the total of targets.
  Trying to work one's way through the tortuous logic which has led the Government to their present position shows one just how complicated the position must be for those in town halls and shire halls throughout the country. The Government have not only consistently reduced the resources available to councils for funding services, providing jobs and helping the most disadvantaged, but they have thoroughly confused and unsettled local government to the point where good working relations between the Government and local government are at the worst level in living memory. That is the reality embodied in the words of the ADC and the ACC as well as of the AMA.
  In 1984–85, £660 million was unallocated, in 1985–86, the figure was £400 million and for 1986–87 the planned figure is £200 million. That represents the difference between what the Government would like to spend through GREs, in aggregate and individually, and the targets that they recognise may be attainable. However, in 1984–85 the targets set by the Government were described by Councillor John Lovill, the Conservative chairman of the ACC, and by others as unattainable for some authorities. Many authorities of various political complexions have endorsed that view. They are being asked to accept a 6 per cent. cash reduction. It is not fair, sensible or practicable for a Minister charged with responsibility for providing resources in a sensible working relationship with local authorities to have such a stranglehold over them, their budgets and their expenditure, or to have the option to

  151
  employ three different targets to suit his own political purposes. That is what is being proposed, and it is for that reason that I have moved the new clause.
  Mr. Anthony Beaumont-Dark: One great confusion was introduced with the Local Government, Planning and Land Act 1980, which some of us voted against. It abandoned the aggregate and the local policy in favour of a Government norm so rough and ready that some authorities find it easy to reach, some find it difficult to reach and some find it impossible. That is very unfair, and makes it impossible to plan.
  Dr. Cunningham: I agree with the sentiments expressed by the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark). In seeking to impose their will centrally on local government, the Government are not concerned about the level of services. In reality, their principal concern is an overwhelming desire to cut local government expenditure for the sake of cutting it.
  I do not object to the Secretary of State saying that the Government should be seeking efficiency and improved performance from local authorities. No hon. Member would dissent from that. However, this is no way in which to achieve that aim. Indiscriminate cuts are forced upon those who are entrusted with the responsibility of providing services as important as education, the police, the fire services, and services for the elderly and the chronically sick and disabled.
  The Government's policies will lead not to great efficiency in local government but to an undermining of vital services and to further disadvantage in urban areas and the inner cities, especially of the black and ethnic communities and those who are already disadvantaged. That is not an improvement in efficiency. It will widen the gap between the haves and the have-nots.
  It is clear that the provisions of part I of the Bill cannot make a significant saving in public expenditure.
  The Under-Secretary of State for the Environment (Mr. William Waldegrave): Of course they can.
  Dr. Cunningham: I challenge the Under-Secretary to substantiate what he says. We took the Secretary of State's own figures, which were presented to the Committee, and his own hit list, and did the calculations. They show that in some cases there could barely be any net gain to the Treasury if a small number of authorities had their budgets controlled. The expenditure savings set out in the White Paper can be achieved only by the wide use of the general powers in the Bill.
  Mr. Waldegrave: As usual, the hon. Gentleman is employing elision and sliding from one argument to another. He is deliberately confusing grants with public expenditure, and that makes it look as though he has an argument when in fact he has not.
  Dr. Cunningham: The Under-Secretary and I will have to agree to differ.
  The Bill is really an attempt to control local authority expenditure. It is not about fairness for the ratepayer, or improved efficiency in the provision of services. The use of the powers in part I of the Bill to control the budgets of a small number of authorities is unlikely to produce any significant net saving for the Treasury. I also believe that a reduction in local authority expenditure raised from the rates will make no significant difference to the management of the economy as a whole.
  152
  I do not want to bore the House——
  Mr. Waldegrave: The hon. Gentleman's argument about how the economy should be managed is a perfectly fair one to advance, but no serious commentator doubts that the Bill will reduce public expenditure, and that is one of its prime purposes.
  Dr. Cunningham: The Under-Secretary of State says "no serious commentator". I assume that he is overlooking articles by the general secretary of the Chartered Institute of Public Finance and Accountancy, in the Financial Times and in a wide range of local government publications.
  Mr. Cowans: I am grateful to my hon. Friend for taking up the Under-Secretary of State's words. He is right only if part II is applied. Very little will be saved under part I, but there is a balance of £1·7 billion that can be saved only if part II is applied immediately. The Minister keeps telling his right hon. and hon. Friends that part II will never be applied. If that is so, he is incorrect to say that part I will make the savings that he claims.
  Dr. Cunningham: Yes. There is obviously a fundamental difference of opinion among the Government, their Back Benchers and the Opposition on this issue. Whatever the difference is, the Government's argument about their aims and intentions for the Bill are now a long way from their expressed intentions at the time of the publication of the White Paper and of the Bill before Second Reading.
  The new clause would prevent Ministers from having three means of taxing local authorities on their performance and saying that in every case the highest figures should be used. Under a general scheme, will the total of spending limits have any significance, and will it be cited in the Government's expenditure plans? If the general scheme under the Bill is to be employed, what will be the purpose of those spending limits? Will such a total be higher than the total of GREs or the total of target;? If the answer is yes, where will the extra money come from in the Government's expenditure plans? We should like an answer to that question, especially in the light of what the White Paper says.
  How will the Under-Secretary of State deliver the promise that he made during our debate on the rate support grant to the effect that the Bill enables the Government to improve financial assistance to the shire counties? We cannot see how that promise cart be delivered. What is the logic in penalising an authority for overspending—the Government's pejorative description of what many local authorities do when they feel it necessary to support services—expenditure guidance when spending within their expenditure limit?
  If the Government cannot answer those questions satisfactorily —I suspect that they cannot—it will be clear that they want to have the best of all possible worlds. That will be the reason for having three separate amounts by which they can tax the performance of local authorities. I believe that that is simply to suit their political purposes. It has become extremely clear in Committee that, with regard to fairness among ratepayers, those who use local authority services and control of local authority expenditure and the subsequent savings to the Exchequer, the Bill, as it stands, is fatally flawed.
  Mr. Geoffrey Rippon: I hope that the Government will look favourably on new clause 6. When

  153
  one examines legislation one asks whether it will work and, if so, whether it is desirable. I believe that the Bill fails on both counts, and will be proved to do so. Some of us, as my hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) said, warned about that in 1980 and 1982. This attempt to determine in Whitehall the needs of every local authority will not work. It is just as hopeless a task as when, during the last war, the Government attempted to introduce legislation to measure rhubarb leaves and the translucency of eggs.
  4.15 pm
  I have considerable experience in local government, in the House and in various Ministries connected with local government, and I believe that the Bill will not work efficiently or with justice and will not contribute one iota to the general good of the country. If I may say so, I believe that my hon. Friend the Under-Secretary of State was a little unwise to intervene quite so quickly to say that the Bill, as every reasonable commentator knows, will reduce public expenditure. Public expenditure is running at about £126 billion a year. On the best estimates of the Government themselves, the rate-capping provisions will save £300 million out £12 billion. Even that is doubtful, because although some of the commentators in the Financial Times and elsewhere might have exaggerated when they said that the Bill will end up costing the Treasury £1·5 billion—it might be only £500 million—there is no justification for saying, as the hon. Member for Tyne Bridge (Mr. Cowans) said, that it will have any effect on the total of public expenditure unless part II is introduced. I do not see how it is possible to get away from that. The nation will not be benefited, because the rate-capping provision will apply—if the Secretary of State is right, and we might get clarification later—to only 20 authorities.
  Mr. Waldegrave: I understand and respect my right hon. and learned Friend's long-standing and consistent objections of principle to the Bill. I do not agree with his argument about the totality of public expenditure, as opposed to savings on rate support grant to the Treasury, where a complicated case can be made. Opposition Members complain about the Bill leading to a reduction in services, but no one doubts that the Bill will diminish spending in that part of the public sector which falls to the rate-capped authorities.
  Mr. Rippon: It is not possible to say that nobody says it, because I say it, and the Financial Times has said it. Acts of Parliament that are basically unworkable and so confused that hardly anyone can understand them do not end by producing a more efficient or cheaper system of government. That is my belief. I might be wrong, but time will tell. New clause 6 attempts to introduce some clarity. If Parliament is to give the Secretary of State such sweeping powers as are now envisaged to pick off one authority or other by whatever criteria he might ultimately have in mind, we should define those powers with much greater clarity. My right hon. Friend the Secretary of State said in Committee on 6 March that the implementation of part II would be "a major constitutional matter".
  That applies to the Bill as a whole and even to those matters to which new clause 6 is directed. Unfettered discretion—I also say this from some experience—given
  154
  to Ministers in matters of this type which affect hundreds of authorities is, in practice, given to permanent officials in Whitehall. Therefore, every time in a Bill such as this we read "Secretary of State for the Environment" we should substitute "principal" or "assistant principal". It is not good enough to give such wide powers to any Minister just on the basis that my right hon. Friend will use them wisely.
  A future Secretary of State — let us call him, hypothetically, Ken Scargill — might not act so benevolently when using this Conservative measure. Nothing is more prejudicial to good legislation than the idea that Parliament can merely pursue ends without very careful consideration of the means.
  No one is objecting to a limitation to the rate burden, to reduction, where appropriate, in the total percentage of Government grant, to measures that lead to greater efficiency, or to bringing pressure to bear on local authorities that are spending unwisely. That is also a matter for the local electorate to consider. However, it is absurd to make general sweeping observations that somehow a Bill of this kind will result in a dramatic reduction in public expenditure. Local authorities cannot print money, there will be no effect on the PSBR, and capital expenditure is already controlled. We should be extremely wary of so-called skeleton legislation of this kind.
  Mr. Beaumont-Dark: Perhaps I can add fuel to what my right hon. and learned Friend has said. Is it not impossible nonsense to say that local government expenditure will fall when the target set for it over three years falls by 11 per cent., allowing for inflation, as a result of which more expenditure is being passed to ratepayers, given that the rate support grant has fallen from 66 per cent. of expenditure to about 50 per cent.? Surely it is impossible to ask local authorities to do what this or any other Government have been unable to do for central Government expenditure.
  Mr. Rippon: I accept that part of the problem is that over a period of years—this applies to a number of Governments—we have shifted expenditure from taxes to rates and from voters to non-voters. There is no doubt in my mind that the only way to deal with these problems is to have a thorough-going restructuring of local government finance. I am all for restructuring the European Community budget, and there we are talking about a good deal less than £12 billion a year. Therefore, there is a good case for restructuring local government finance. Indeed, one of my objections to the Bill is that it dodges the whole issue of local government finance and the real necessity to reduce the rate burden on both domestic and non-domestic ratepayers.
  Mr. Christopher Chope: If my right hon. and learned Friend thinks that we should restructure rate revenue, would it not be preferable if we were able to take some effective measures against profligate authorities? What does he propose we should do with the undoubtedly profligate authorities which prosper in areas where there is no prospect of their being voted out of office?
  Mr. Rippon: My hon. Friend refers to a profligate authority. I have no objection in principle to rate-capping an authority that has abused its powers, nor have I any

  155
  objection to sending in commissioners when a local authority manifestly behaves illegally. However, in those circumstances, the House should consider every case. That is quite different from giving a sweeping power to a Secretary of State to nominate all sorts of authorities which he thinks are profligate. He will never be able to acquire the evidence in relation to 19 or 20 authorities, much less for the whole country, without being guided almost entirely by permanent officials.
  My objection to this type of skeleton legislation is that it does not clearly set out the criteria by which a profligate or overspending authority is defined. What is overspending is a political decision, not something that can be laid down automatically from Whitehall. After all, a skeleton is the very symbol of lifelessness, and a bony structure does not make an organism.
  In his book "Law and Orders" published just after the war, Professor C. K. Allen said of skeleton legislation:
  "It is a dangerous doctrine that the legislature is only concerned with that osseous framework and is incapable of understanding the organs and the flesh and the blood—not to mention the soul".
  We should not treat this simply as an exercise in controlling public expenditure, because we are undermining the entire historical relationship between Members of this House and members of local authorities, who in their own way are also trying to serve the country.
  The new clause tries to introduce some sort of order into a disordered situation. The three factors that must be considered are the target, which is the expenditure guidance as defined in the 1982 Act, the expenditure limit in accordance with the Bill, and the GRE.
  I have previously suggested that the 1980 and 1982 Acts would fail. That, presumably, is why we have the Bill. There have been two Acts, seven changes in the basis of grants and a system that is now operating under which people cannot be sure from month to month or from year to year whether they will be underspenders or overspenders according to whatever criteria may be chosen. This is a thoroughly unsatisfactory state of affairs, however we define it.
  Mr. Patrick Cormack: Does my right hon. and learned Friend agree that among the authorities most worried by this legislation are ones such as my own in Staffordshire, South which have records of prudence, good sense and sound housekeeping and which are now in a state of jittery uncertainty?
  Mr. Rippon: That is true and has developed. As I also warned, people were quite happy when they thought that the 1980 and 1982 Acts would hit Socialist authorities and only a few of the so-called overspenders. In the event, they hit authorities which thought they had been acting prudently. We must also bear that in mind. What is the logic of trying to pursue an authority for overspending when it is within its expenditure limit? There are so many anomalies in the present legislation, and there is such a state of confusion, that it is totally incomprehensible that we should have another Bill which will merely make things even worse and more confused.
  There has been much talk of a breach of some supposed convention between the local authorities and central Government. I do not recall any such convention. I do not know what has happened that is so very different. Normal practice has been the control of capital expenditure and a long negotiation with the local authority associations over
  156
  the basis and total percentage of the Government's contribution to local government. It was always accepted that needs would vary from area to area.
  In 1973, I recall asking the then Minister for Local Government and Development to discuss with individual local authorities whether their needs, unemployment position or availability of men and materials were so different that they could have an additional capital allowance. But once the Government had controlled the percentage of Government expenditure and adjusted domestic rate reliefs and so on, it was always accepted that the local authority had to define local needs. The local ratepayers had to pay the subsequent rate, and if they thought that the local authority was extravagant the remedy was in their own hands.
  I do not believe that the question of how many rate catchers are needed in Liverpool should be turned into a sort of war of Jenkin's ear between the local authority and the Department of the Environment. We must ask whether Parliament exists simply to enumerate general principles and then to leave their application entirely to the central bureaucracy. Should not we be considering the working of the principles that we may be willing to approve and adopt? We have— and I speak as, perhaps, a rather Right-wing Conservative—come a long way from John Locke's requirement for liberty under the law:
  "The laws must be known and certain and not subject to the unknown, unjust, arbitrary will of another man."
  The Bill concentrates Government power to an extent unparalleled since local' authorities were created. It seriously alters the whole relationship between central and local government.
  4.30 pm
  On Second Reading I suggested that my right hon. Friend the Secretary of State should read and that my right hon. and learned Friend the Lord Chancellor should reread his book on "The Dilemma of Democracy" and what he had to say about "elective dictatorship". In the light of the Government's White Paper, we are considering the so-called doctrine of the unitary state and the principles of parliamentary supremacy. There is one other document which I should like my right hon. Friends to look at—the book written by my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph), called "Freedom under the Law", published by the Conservative Political Centre in 1975. In it he said:
  "The unbridled supremacy of Parliament is quite recent, historically speaking. Parliamentarians of the past believed that Parliament, though primus inter pares among the powers, should respect the independence of other institutions. They saw the 'liberties of Englishmen', as actually enjoyed, as the great barrier to despotism. Parliament was respected precisely because it rested on a great base of independent and separate institutions. By turning on them and subjecting them, it is eroding its own political base."
  I hope that before my right hon. and hon. Friends support this measure they will hear in mind that they will be doing so contrary to every precept and rule of law for which the Conservative party has ever stood.
  Mr. John Cartwright: It is a pleasure to follow the right hon. and learned Member for Hexham (Mr. Rippon) because he articulates the true voice of local government Conservatism, with which some of us have grown up, on which we have cut our political teeth and from which we learnt a great deal. I agree with everything that he said.

  157
  One point that always puzzles me in debates about rate capping is the lack of confidence that most Conservative Members have in the electoral process. When they refer to the wicked, overspending authorities, one cannot help but remember that a number of those authorities have been Conservative-controlled at some time in the comparatively recent past. It is true that we must have a Labour Government to create that kind of Conservative control and that, faced with the problem of a local authority that seems to have forgotten the genuine priorities of its electors, Conservative politicians do not try to strengthen their local appeal so as to win an election and change that authority. Instead, they seek to bring into play higher forces — big brother in Whitehall — rather than to mobilise the forces of opinion at local level.
  Mr. Jack Straw: Does the hon. Gentleman agree that, in particular, new Conservative Members show a curious lack of confidence in the democratic process, and that their presence here often confounds their hestitations about that process?
  Mr. Cartwright: As ever, the hon. Gentleman puts things rather more elegantly than I. Perhaps my presence here shows that one can have greater faith in the electorate than Conservative Members seem to have when it comes to local government issues.
  I operate in one of the boroughs that has been picked out for rate capping — the London borough of Greenwich. I live there and represent a large chunk of it. I have made it clear on a number of occasions that I do not support its spending priorities. Much of what it is doing is not in the best interests of my constituents, and I have said so on a number of occasions. I should prefer to take the problem back to the electorate on the next occasion, in 1986, than to bring into play civil servants and Ministers in Whitehall to sort it out.
  It is not easy to help the London borough of Greenwich in these matters. Knowing that I was going to be on the Committee dealing with this Bill, I wrote to the chief executive of Greenwich on 10 January, asking him for the appropriate information about the effects of the Bill on the local authority. I have not had any information, a letter in reply, or even an acknowledgment. No doubt, the chief executive of Greenwich remembers that old story about the aged Member of Parliament in the Tea Room, giving advice to a new Member, who said, "Never answer letters, son. It only encourages them."
  I was not deterred. When the Secretary of State introduced his famous fruit machine and produced 11 possible methods of qualification for rate capping, we discovered that Greenwich hit every one of those categories and therefore qualified 11 times for rate capping. I thought that that might concentrate a few minds in Greenwich, so I went to see the leader, the chief executive and the treasurer and brought them the glad tidings. I asked them whether they would like to respond to these facts. They looked worried and said that they would. So far, I have not heard a word from them.
  I notice that the hon. Member for Copeland (Dr. Cunningham)—who has left us briefly—is apparently to visit my constituency on Thursday to lead the local population, in the great uprising called "Democracy Day", against the rate-capping legislation. The council has produced a leaflet that says that, with help, it can defeat
  158
  the Rates Bill. I should have liked some help from the London borough of Greenwich to help me defeat the Rates Bill. I have not had very much.
  Mr. Straw: We have given the hon. Member for Woolwich (Mr. Cartwright) a great deal of help, and I hope that he will show his gratitude.
  Mr. Cartwright: The hon. Gentleman is again leading with his chin. I was seeking practical information as to how this legislation affects the London borough of Greenwich, but I have not even had the courtesy of a reply to my letter. If the hon. Gentleman is saying that it cannot be done, I point out that this week I had a letter with facts from the leader of the council in Lewisham, the neighbouring borough, which contained a great deal of critical information showing how the legislation would affect Lewisham, and giving Lewisham's answer to the Secretary of State's approach. If Lewisham can do it, I do not see why Greenwich cannot.
  Mr. John Powley: Does the hon. Gentleman agree with my experience in local government — that when one asks officers for a report on how economies can be made in the local authority, they inevitably produce a report itemising the most emotional sectors with which the local authority deals as being subject to economies? They never say that they could do away with creating a nuclear-free zone or with the leaflets that are produced, or improving the efficiency of services so as to reduce the number of local authority staff. Such reports are never produced. Instead, officers report on the most emotional things that they can think of.
  Mr. Cartwright: The hon. Gentleman tempts me into interesting byways. All officers, when asked for suggestions about economies, make sure that those economies do not impinge on their responsibilities. That is a natural development in local government. I am saying that any answer, reaction or information from Greenwich would have been welcome. Instead, there was stone-wall silence.
  Mr. Cowans: Perhaps the hon. Gentleman is too hard on the London borough of Greenwich. I, too, received the correspondence from Lewisham, which was welcome. However, although most of the things in the document were valuable and interesting, they have already been used in Committee. Whether it be Greenwich or anywhere else, is it not the case that the vast majority of local authorities cannot react to the Bill because most of the things to which they want to react are not yet in the Bill and apply only after the Bill has become law?
  Mr. Cartwright: The hon. Gentleman always makes an interesting case, but if his local authority had struck gold on every one of the qualifications that the Secretary of State suggested for rate capping, would it not have come up with some good answers as to why it was in that position, why its spending looked to be higher in relation to past records of comparatively low spending, and so on? I was asking only for some practical information.
  Mr. Straw rose——
  Mr. Cartwright: This is getting rather like a seminar.
  Mr. Straw: The hon. Gentleman seems to be providing the answer to his question, to the satisfaction of the House. In his speech on Second Reading, he told us that, despite Greenwich's high level of spending, an Audit Commission

  159
  report showed clearly that expenditure per head in terms of services lagged behind comparable Tory boroughs. Surely that is the explanation.
  Mr. Cartwright: Unfortunately, that information turned out to be not entirely accurate. The Audit Commission's information, as related to me, turned out to be not quite as I presented it. That is why I wanted rather more firm information from the London borough of Greenwich than that which I quoted on an earlier occasion.
  I support the new clause because it reminds us that the Bill has not appeared out of a vacuum. It comes to us from the same team that produced the Local Government, Planning and Land Act 1980 and the Local Government Finance Act 1982.
  The 1980 measure gave us an extraordinary phrase that is referred to in shorthand as GREA — grant-related expenditure assessment. Many of us were suspicious of that form of assessment and disliked the idea that somebody could calculate a reasonable and rational level of spending for local authorities in various areas for a given service.
  A phrase constantly used by Ministers in Committee when describing the grant-related expenditure assessment system was "rough justice". It was claimed that it was the only available test of an authority's need to spend. A number of those engaged in local government accepted it on that basis. They accepted it also on the understanding that it would be used as a means of allocating grant, not of controlling expenditure. However, as we often discover when dealing with these issues, the one slid inexorably into the other.
  The 1982 Act regularised the complex business of expenditure guidance, as it was euphemistically called, which incorporates the target and penalty system. In this Bill we have the concept of a maximum expenditure limit. It provides a third weapon in the armoury with which Ministers can tax local authorities on their spending. Given their past record, I can understand why the Government feel that they need belt and braces, but to require belt and braces and a stout piece of string seems to be going rather far.
  If the clause were accepted, it would serve two useful functions. First, it would go far towards simplifying local authority expenditure. It is a novel idea that it could be made a good deal simpler. Local government officers, councillors and ordinary members of the public would very much welcome that.
  Secondly, it would go some way towards introducing an element of natural justice into the way in which local government operates. It seems extremely unfair that a local authority which is spending below its grant-related expenditure level should be penalised under the grant penalty arrangements or the rate-capping system. It seems monstrous that an authority that is spending below its maximum expenditure limit should be penalised under the preceding arrangement.
  Opposition Members have constantly urged the Government to accept amendments and new clauses which would smooth the impact of the Bill and make it appear rather more fair and reasonable than it is. Our efforts have been thrown back in our faces. It is a reflection that hope triumphs over experience that we continue to make them. It is very much on that basis that I commend the clause to the House.
  4.45 pm
  Mr. Reg Prentice: The new clause and the proposed amendments to part I should be regarded as a form of damage limitation. The Bill is an extremely bad measure and it will not become acceptable to many of us, irrespective of the amendments that are accepted and implemented. I wish that at this late stage the Government would listen to the vast amount of expert criticism of what they are doing, especially the criticism that is coming to them from Conservative councillors of long experience throughout the country. Assuming, reluctantly, that they will not take that advice, there are two realistic hopes that we must bear in mind.
  The first hope is that the Bill will be seriously amended in another place. By that I mean removing the general powers and imposing some strict limitations on the way in which the Government will be able to use the powers in part I. When that has happened, I hope that the Government will not attempt to get this place to restore the Bill to its original form. Should they try to do so, I hope that they will not succeed.
  The second realistic hope is that by prolonged discussion, including the present one on the practicalities of the powers in part I, the ongoing debate outside the House and the dialogue with the local authority associations, the Government will be strongly encouraged to make the minimum, rather than the maximum, use of the powers in part I.
  Any use of the powers in part I would be profoundly damaging, because it would open a new chapter in the constitutional relationship between central and local government. For many years now Governments of both major parties have had some powers over the spending of local authorities. They have had direct powers over the capital expenditure of local authorities, but they have relied on persuasion in influencing local authorities' total expenditure. That persuasion has been reinforced with a carrot-and-stick apparatus. Sometimes there have been powerful carrots and sticks— for example, the present arrangement that bears on targets and penalties. The new step of the Government prescribing the maximum expenditure of a local authority will seriously change the constitutional relationship between central and local government. If that change were pursued widely and used more every year, it would be the beginning of the end of local democracy.
  Others have said that the Government would make the minimum use of the powers in part I if they applied them to less than 20 authorities. If they took that course, they would not make a significant saving in public expenditure. I thought that that was undeniable. I took that view until I heard the intervention from my hon. Friend the Under-Secretary of State. Perhaps he will enlarge upon that later.
  The figures that have been given, including those provided by the Secretary of State on Second Reading, suggest that the use of the powers in part I against a penal code would lead only to an insignificant part of public expenditure being saved.
  Mr. Allan Roberts: Is the right hon. Gentleman aware that in Committee the Secretary of State for the Environment suggested that there would be an increase in central Government expenditure as a result of rate capping under the restricted scheme, although that would mean lower rate increases, which might mean a reduction generally in public expenditure? However, there

  161
  would be more rate support grant given to local authorities which were rate-capped because they had held down their rates and cut their services. The consequence of that policy would be to increase central Government expenditure. That contradicts the belief of many Conservative councillors that there would be more money for them from central Government if profligate Labour authorities were rate-capped.
  Mr. Prentice: I am grateful to the hon. Gentleman for his intervention. It bears out the argument that, if the powers in part I are used in the limited way that is so often prescribed, there would be no savings in public expenditure, or only very small savings. That has led some to suggest that the Government would have to implement part II. That is not necessarily so, because there is no limit in part I on the number of authorities to be rate-capped. An amendment directed to that argument will be discussed later.
  The new clause is relevant to that point because it establishes the criterion of a higher threshold, so a smaller number of authorities would be less severely affected. I wish to concentrate on that aspect. After the Bill becomes law, many pressures will be put on the Government to use the power more each year. Pressure will come from disappointed ratepayers who, having expected the Bill to relieve their rate burden, find that it does nothing of the sort. Pressure will come from the CBI and other spokesmen of industry, as well as from the Treasury in the context of the annual discussions on public expenditure.
  There will also be the knock-on effect that was so well described by the hon. Member for Blackburn (Mr. Straw) in his closing speech for the Opposition on Second Reading. If a dozen or 20 authorities were rate-capped in the first year, and it was found that another dozen authorities were spending more than the rate-capped authorities, it would be logical to add that second figure to the first in the second year, and perhaps to add a third group of authorities in the third year. Therefore, the unamended Bill would tempt the Government to use the power more each year. Indeed, the Government would be under pressure, as a general election approached, to do something about the rates and would perhaps use the powers in the Bill.
  I support the new clause and, by implication, other new clauses and amendments before the House today. They would provide limits in different ways on the use of the powers in part I. The House could oppose these limits if it had the will to do so. Otherwise, they could be opposed in another place. If the Bill is passed unamended and if the Government made increasing use of those powers year by year, that would be the end of local democracy.
  Mr. Allan Roberts: I shall speak briefly about new clause 6, relating it to the Government's general powers to cap the rates of many local authorities. The new clause refers to grant-related expenditure—the target used for expenditure guidance referred to in the Local Government Finance Act 1982 — and to an expenditure limit determined in accordance with the Bill. That should not be used by the Government as justification for and means of assessment of rate capping. The new clause provides that the highest figure produced in those three determinations of expenditure shall be used for all the purposes required under the legislation.
  162
  The new clause is important because the existing provisions enabling the Secretary of State to use any one of those three determinations, or any combination, bureaucratise the draconian powers taken by the Minister under clause 2. It enables the Secretary of State, his civil servants or his computer at the Department of the Environment at any time to alter the means by which rate capping is introduced. It enables the Secretary of State to alter the criteria in an arbitrary and unjust way, so that he can put chosen local authorities into the penalty box. That would affect only Labour-controlled local authorities. Based on the simple, party political argument, a Conservative Secretary of State could use the GRE, the target or the expenditure limit as he chose, or any combination, so that Labour-controlled local authorities, or those not controlled by the Conservative party, fell into the penalty box.
  The Bill is not simply that of the Secretary of State for the Environment. The truth came out when the Secretary of State, in Committee in the middle of the night, said that the general powers would not be used. We have been told that that infuriated the Chancellor of the Exchequer, and it certainly infuriated the Treasury. This legislation is as much that of the Treasury as it is of the Department of the Environment. If the public sector borrowing requirement begins to get out of hand and the burden of expenditure by local authorities is high, the Treasury might urge the Cabinet — not necessarily the Department of the Environment or the Secretary of State—to require that the general powers should be applied. If the general powers could not be applied, the GRE, the target figure and the expenditure limit might be used to bring many more local authorities into the penalty box in order to reduce public expenditure, which is what this legislation is about.
  In Committee, we challenged the Secretary of State to tell us in what circumstances the general powers would be used and how the Government could allay the anxieties of local authorities belonging to the Association of County Councils or the Association of District Councils and representatives of Conservative-controlled local authorities. The Secretary of State put forward two arguments. He said that the general powers would be used only in exceptional circumstances, if at all. He developed a scenario in which as many as 100 local authorities which were acting reasonably one day suddenly started to act unreasonably and to overspend.
  The Secretary of State was asked to say what circumstances would bring about such a change: whether the electorate would return councils of a different political persuasion or whether the local democratic process would be overridden by the Government's general rate-capping powers. The Secretary of State said that that would not happen, but he could envisage a moderate Labour leadership of a local authority suddenly being overthrown by a loony Left leadership, which happened at the GLC when Ken Livingstone took power. The Secretary of State speculated that that could happen in 100 local authorities all at once, as if there were 100 Ken Livingstones poised in the wings waiting to take over. The country and local authorities are not fortunate enough to be in that position. The Secretary of State's first argument was ludicrous. His second was that the power would not be used, but, once on the statute book, it would act as a deterrent—a sort of independent nuclear local authority deterrent—which would never be used but was needed, just in case, to deter

  163
  those who might be tempted to spend more than the Government wanted. That was one of the reasons for introducing the power.
  We challenged the Secretary of State to tell us what criteria would be used and how they would be applied, and to give detailed information about determining the authorities to be rate-capped. The Government produced lists and ideas. Based on differing criteria—using the GRE, the target and the expenditure limit—different local authorities fell into the penalty box, or "scored the lemons" as the hon. Member for Woolwich (Mr. Cartwright) said. The combination of criteria to be used would depend on which local authorities were in line for rate-capping. The criteria—the Government's intentions —are arbitrary and are not enshrined in legislation. The Government are merely handing on a plate to the Secretary of State for the Environment—or, as some Conservative Members have said, civil servants—the right to decide.
  5 pm
  In Committee the Secretary of State said that he objected to Opposition Members claiming that civil servants in the Department of the Environment would take policy decisions. I am sure that the Secretary of State was sincere, believing that the situation is such that the decisions about penalties, clawback and holdback are taken by Ministers, not by civil servants. However, if the legislation goes on the statute book, it will be impossible for any Minister to determine the levels of services and expenditure for the purpose of assessing who should or should not be rate-capped without handing the job over to computers or the Civil Service, because it will be too big for any group of Ministers.
  I support the new clause. I hope that the Government will look at it favourably, as the right hon. Member for Daventry (Mr. Prentice) did. If they do, it will be the first time that any reasonable, logical or sensible amendment or new clause has been looked on favourably by the Government. In Committee, they would not accept one suggestion, amendment or new clause that came directly from the two Conservative local authority associations. They did not even accept amendments that required more consultation, more parliamentary scrutiny or the establishment of the principles on which rate capping will be based.
  We were trying to help. We said to the Government, "These are your Conservative councillors who are suggesting these amendments, which you need to accept to make the Bill acceptable to some of your own Back Benchers and people in the local authority association." The Government would not listen. They did not accept one amendment. I hope that they will accept the new clause. If they run true to form, that is unlikely. It is in the spirit of trying to assist the Government to improve their legislation, particularly in the eyes of their own supporters, that the new clause is moved.
  Mr. Beaumont-Dark: For about four years, in one piece of legislation after another, we have endeavoured to think that we can do the impossible. I said on 8 July 1980 that in a wretched package, which is what I called the Local Government, Planning and Land Bill,
  "We shall reap a bitter harvest, and we shall not get the cooperation that we desperately need between the great spenders of Whitehall and of town halls." —[Official Report, 8 July 1980; Vol. 988, c. 269–70.]
  That has proved to be true.
  164
  The way in which we decide what local authorities get is unjust. It is so easy for some and so difficult for others to comply with it that there is no sense of natural justice. Whether it is right or wrong, the Government have decided to switch from the rate support grant to the ratepayer a considerable burden of extra expenditure. If the system was bad all those years ago, which was the reason why we introduced new Bills, how much worse and more unfair it is today.
  On Saturday, at a certain party's central council, the Secretary of State once again put forward what in my view is the most misleading case and promise of all and accused those of us who disagree with him of being fractious. Why is it fractious to stick by principles that one has held and that one was told one's party held? A certain person has done terribly well since she rightly said on 28 August 1974 that
  "within the normal lifetime of a Parliament we shall abolish the domestic rating system and replace it by taxes more broadly based and related to people's ability to pay. Local authorities must continue to have some independent source of finance."
  As I said in Committee, I agreed with that then, and I agree with it today.
  In 1978 the present Secretary of State for Defence was concerned with local government. He said:
  "We are committed to a root and branch appraisal of the powers of Whitehall over local government. We shall in government department after department, reduce and eliminate many of the controls that currently tie Britain's cities to Whitehall departments. I believe that that will speed decisions, save money and restore a sense of competitive independence to local democracy."
  My right hon. Friend was right then, and he is right today.
  It is not those of us who oppose the Bill who have shifted our proper ground on changing to a fairer system. but other people have moved on. They have left the principle behind that one cannot expect the rating system to bear the burdens that it does. If the people of Italy. France, Germany, Switzerland and America have a better system, why do we have to lie back supinely and say that this country alone, with all its inventiveness and its lead in the world, cannot find a better way for local taxation to be raised? We are the only country—it grieves me that a Conservative Government should do it — that needs these draconian powers, yet we are the very cradle of democracy. Disraeli is one of the people whom our party likes to quote. I like to quote him because he was sound then and is sound today. He said that
  "Centralisation is the death blow of public freedom."
  Centralisation is the death blow of freedom. One good thing that came out of the Committee was the wonderful publicity that was given to the Under-Secretary's book on Leviathan and the future of the Conservative party. What he said in his book followed the drift of my view. I agree with what he wrote now that I have read his book. I hope that when we have got this squalid little Bill out of the way we shall not lie back and say that we cannot do what our continental friends and the Americans can do. That would pain any of us in the Conservative party who loyally believe in the principles on which we were elected. I agree with most of the things that we do. However, it is bad for the Conservative Government to throw in their hand as they have done in this problem. One cannot expect local authorities to play the game if we do not play the game with them.
  As has been said by more than one hon. Member, there is a kind of Russian roulette in local government finance, so that no local authority knows from year to year or week

  165
  to week on what real criteria it should base expenditure. To have a system where the needs of the old people of Bournemouth are judged the same as those of the old people of Aston, in the city of Birmingham, must lead to all the iniquities and the sense of unfairness that people hate.
  It sounds odd that we should depend on an undemocratic House to keep democratic rights for people. I hope that the Government will have the sense to think again. The basis of local accountability for local expenditure decisions will be destroyed if the Bill is passed; the basis of accountability will be with the Secretary of State. It is not the audience that one has to please, but the managers. The most important thing about local democracy, which is a thread through life in this country and is just as important as the rights and spirit of the House, is local accountability for local decisions on local needs.
  Every now and then we hear of ravings by idiot people in Liverpool and of some strange people in the GLC who support groups such as "Black Babies against the Bomb", peace groups, or "Troops out of Northern Ireland". The Government believe that because of some of those things one must destroy the basis of local government legislation and damage the name of Conservatism, which stands for freedom for all. In my view that is foolish, as is the Bill. It may be too late to make a change here, but I hope that the other place will restore the Conservative party to itself again.
  It grieves me genuinely that I have had to fight the Bill for some months, together with other people. We are not fractious or being just disagreeable. We are not the disappointed—whether we are in office, out of office or will never have office. We are elected to the Chamber to support the principles of Conservatism and what we said when we were in opposition when we had time to think.
  People will feel harried and under pressure. The Bill will not save expenditure. It will not even work, so it will be bad politically as well as constitutionally. People will believe anything if they believe Government statements at Conservative and other conferences that all will be well when the Bill is passed. If any Government have kept expenditure under control, it is this Government. They have done so against great odds and with great credit. Nevertheless, expenditure has rolled on, although at a lower level. We have set down that, in the next three years, local authorities will need to reduce expenditure in real terms to minus 7 per cent., minus 2 per cent. and then by minus 2 per cent. Therefore, Robin Pauley's figures in the Financial Times are likely to be proved true.
  The Conservative party will reap all the unpopularity that should rightly belong to local decision-makers. As Members of Parliament, we shall be harried and hounded about this Bill, which will not work.
  Mr. Allan Roberts: Will the hon. Gentleman give way?
  Mr. Beaumont-Dark: I shall just finish my speech. I hope that even at this late stage the Government will, even if they cannot concede the Bill, agree to stand by their 1974 principle. If other people can find a better way, so can we. Our Government must have the courage and tenacity to do that. That is why I support the new clause and will vote against the Bill.
  Mr. Chris Smith: The new clause goes straight to the heart of the absurdity and difficulty faced by Whitehall in attempting to set any target figure for expenditure and services in local authority areas. It seeks to highlight the inappropriateness of the present system of grant-related expenditure assessment figures, penalties and guidance figures. It seeks to highlight also the absurdity of expenditure limits, which the Government are seeking to impose in this Bill.
  My hon. Friend the Member for Copeland (Dr. Cunningham) amply demonstrated the absurdity of having three different target figures, all of them supposedly to be met by local authorities. I hope that the Government will give an interesting response about exactly which of the guidelines that the Government seek to impose on local authorities represent a genuine attempt to assess the needs and the services that should be provided in a particular area.
  The grant-related expenditure figures are especially absurd. To date, the Government have based their assessment of what will happen when the legislation becomes law on the GRE figures. We know that the Government are seriously considering using a guideline of GRE plus 20 per cent. as the base line for bringing in the selective powers. The GRE is to act as an objective measure of what should happen in local authorities. We need look only at how the GRE works in practice to recognise that that is far from the case.
  The GRE for social services is an example I used in Committee. It bears repetition because it is a graphic demonstration of where the GRE assessment figures go wrong. The GRE figures for social services in inner London show that each inner London borough, including Conservative and Labour-controlled and supposedly profligate and supposedly prudent authorities, is spending more than 16 per cent. above its GRE assessment figure for social services. I refuse to believe that each of those local authorities is wrong and the Department of the Environment is right. It is clear that the Department of the Environment has its figures wrong and that local authorities' figures more closely reflect the real needs of people in their areas.
  My borough, like the borough represented by the hon. Member for Woolwich (Mr. Cartwright), is one of only five authorities that can be hit under each of the 11 different criteria given by the Secretary of State. According to the Department of the Environment, my borough is spending 33 per cent. above its GRE figure on social services.
  5.15 pm
  I shall examine one example, because it demonstrates the validity of the new clause and the network of different figures and the penalty system introduced and established by the Government. One of the Government's laudable aims is to ensure that in future years care for the mentally ill and mentally handicapped will occur more in the community and less in institutions. As part of that aim, the Government seek to close the large-scale institutions which presently house large numbers of mentally handicapped people. The Friern Barnet hospital serves many boroughs in north London, and its closure, which is scheduled in five years' time, will mean that a number of people will be returning to the communities from which they originally came. About 500 people will probably return to the borough of Islington. They will depend on the

  167
  borough's social services provision for support. The local authority's cost of providing the services can conservatively be estimated at £2 million or £3 million in any one year.
  The block grant penalty on that extra expenditure—this operates for each £1 of new expenditure the borough seeks to provide—to cope with people coming from Friern Barnet hospital will amount probably to about £6 million. The increase in expenditure, which includes the original expenditure and the penalty incurred, will add between £8 million and £9 million to the borough's expenditure to accord with Government policy. Islington people will therefore face about an 18 per cent. increase in rates.
  That is a simple example of what happens under the present expenditure system. The operation of the GRE figures, which are totally inadequate, and the penalties imposed when expenditure rises about above the GRE figures mean that genuine services, which the Government say local authorities should provide, will be dangerously harmed or the ratepayers must foot an enormous bill. That demonstrates that the present system of targets and penalties is haywire. Given the different amounts that the Government say local authorities should be spending on people, who often are in desperate need, the least the Government can say, if and when the Bill becomes law, is that the highest of the figures should apply. The penalty system should not come into operation merely because the Government have imposed spending limits on local authorities. The least that we should ask the Government to accept is that some people desperately require geniune services provided by their local authority in areas such as the one that I represent.
  Mr. Cormack: We have heard some eloquent speeches this afternoon, in particular from my right hon. and learned Friend the Member for Hexham (Mr. Rippon), my right hon. Friend the Member for Daventry (Mr. Prentice) and my hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark). I do not always agree with my hon. Friend the Member for Selly Oak, but he was in sparkling form this afternoon. I am sad to have to agree with them, because it is not comfortable to find oneself at odds with one's party and Government. I know that my hon. Friend the Member for Selly Oak endorses that feeling entirely.
  Here we have a classic case of the old adage, "hard cases make bad law." This is bad law in the making, and I sincerely hope that it can be somewhat improved before it leaves the House, although that I doubt. I devoutly hope that their lordships will do something to tidy it up. Even then, we shall be left, almost whatever they do, with an undesirable and profoundly un-Conservative piece of legislation.
  With many of my right hon. and hon. Friends, I went this morning to the memorial service for Maurice Macmillan. It is not without tragic irony that the Second Reading of this Bill was the last occasion on which, I believe, he cast a vote in the House, and he voted against the Government. He was a man who, in every sense, was not just a true servant of the House, and a notable politician, but a Tory of impeccable credentials. It was because of people such as Maurice Macmillan and his father that many of my generation aspired to the House of Commons. We came here and embraced the Tory creed because we believed in certain simple items of Tory
  168
  philosophy. We did not believe that it was right for the Government to interfere in every minute particular of people's lives. Less government, not more, was the slogan under which I frequently campaigned. We came here because we did not believe in excessive centralisation. That was the way towards the Socialist state. Opposition Members, for the best and most honourable reasons, may wish to tread that path, but I do not wish to follow them and, most of all, I do not wish my Government to lead the people there.
  We came here, too, because we believed that some of the most misguided words ever uttered in post-war Britain were the infamous words of Sir Hartley Shawcross, as he then was:
  "The gentleman in Whitehall really does know better"
  Mr. Peter Hordern: It was Douglas Jay.
  Mr. Cormack: I stand corrected. Sir Hartley Shawcross said:
  "We are the masters at the moment."—[Official Report, 2 April 1946; Vol. 421, c. 1213]
  Those quotations could be hung around the necks of the Secretary of State and his colleagues.
  We also came here because we believed in another old Tory truism of trusting the people. Whichever of those items of philosophy or slogan one takes, this legislation flies directly in the face of Tory tradition and practice.
  It also seems to me that it is not without its sadness that the Minister, who has borne so much of the brunt of taking the legislation through the House, wrote a notable work, "The Binding of Leviathan". I had the honour to review that book when it was first published. I gave it a good review, because I thought that it was an excellent book. I thought that it was a fascinating outline of Tory philosophy. Yet, here he is, poor man, having to take through the House of Commons a Bill which, at that stage in his political development — he seems to have regressed—he would hardly have thought desirable.
  One of my most unhappy recent experiences was to talk to the elected councillors of south Staffordshire. They are Tories almost to a man and woman. The Tories and independents have an overwhelming majority. Some people may say that it is too large a majority, but I would not agree with that. South Staffordshire has a record of prudent housekeeping and of doing all the things that Conservative Members have advocated. We did not have to be coerced, cajoled or persuaded into selling council houses or balancing budgets. I have never seen those elected councillors more sadly united than they are at the moment against the Government and their approach to local government.
  Things have reached a pretty pass when one has elected representatives from all parties, including those who have in many cases given decades of service to the Conservative party and local communities, saying to the Government —if, with my hon. Friend the Member for Huntingdon (Mr. Major) on the Benches, one can slightly distort the words of Cromwell — conceive that you may be mistaken. The Government have not been prepared to concede that they are mistaken, but profoundly mistaken they are.
  There are two factions that could persuade my lion Friend the Member for Selly Oak and myself to support a measure like this one in times of difficulty and crisis. although, thanks to the skilful leadership of the Government in other spheres, I do not believe the crisis is

  169
  so great or the difficulties so many as they once were. The two matters that might persuade us to support such a measure are, first, whether we will make a sizeable cut in expenditure as a result of this measure. I do not believe that anyone has put the matter more eloquently or with more devastating logic than my right hon and learned Friend the Member for Hexham. He made it clear that, however one might deal with the figures and examine the books, there is no chance of our achieving more than the tiniest saving, and there is a danger that there will be an increase in expenditure. By that test, in common parlance, is the game worth the candle? The answer must be no.
  I would remind my right hon. Friend the Prime Minister of a fine and famous speech that she made about the arts — in which I am particularly interested, as hon. Members know. She talked about "candle-end economies". Before we were elected in 1979, she said:
  "We would never advocate candle-end economies."
  If this legislation is not the most high-falutin way of advocating candle-end economies, I do not know what is.
  There is another test, but it follows from the first. Are we delivering what the people expect? This is a classic case of exciting expectations that we cannot fulfil. People believe that we are doing something about the rates. In fact, we are fudging the central issue of rates. If my right hon. Friend and his colleagues had come to Parliament with a Bill that would transfer to central Government, and central control therefore, the cost of teachers' salaries and police pay, and had said to local authorities, "You deal with the rest," they would have come with a logical and coherent case that could have been debated on its merits. Some Conservative Members might not have liked it and some Opposition Members might have liked it because it is not a matter of ordinary party doctrine. The proposal would have been logical and coherent and there would have been a chance of doing something. This legislation is not doing anything about the rates. It is fudging the main issue.
  The Government must not be deluded by the size of their parliamentary majority. I came to the House 14 years ago and within a couple of years found myself in Committee considering the Local Government Bill 1972, which resulted in the changes of 1974. In retrospect, I wish that I had rebelled on one or two occasions during the Bill's passage. However, I did not, partly because I had been put on to the second Bench as a parliamentary private secretary—doubtless the highest form of parliamentary life to which I shall ever aspire. I was summarily acquiescent about that legislation because the pleas not to rock the boat and to support the side seemed to carry with them a degree of moral persuasion, especially when the manifesto was quoted. However, a manifesto is a broad, general statement of intent, to which no single hon. Member is bound in every particular. I do not consider myself bound to support this wretched piece of legislation simply because there was a reference to it, although not a detailed one, in the manifesto, and I wish that I had had the courage to rebel and reject one or two of the previous Bill's clauses.
  5.30 pm
  The Government have a large parliamentary majority and, as in 1970, there are many new hon. Members, many of whom, for the best possible reasons, are reluctant to
  170
  vote against their own side and rock the boat. I hear a voice muttering "Ambition", but ambition should be made of sterner stuff. They should have the courage of their Tory convictions, of which they tell me in the Smoking Room and Tea Room, and demonstrate them on the Floor of the House.
  Unless the measure is significantly amended during the next two days, there will be no point in voting for it on Third Reading. Our hope is in the Lords.
  Mr. Beaumont-Dark: The Lord?
  Mr. Cormack: Our hope is always in the Lord.
  The Lords have recently shown themselves to be enlightened, progressive and robust. It would be wonderful if the most recent member of the hereditary peerage were able to make a maiden speech about the Bill in the Lords. He would doubtless be able to develop the views that prompted his son to vote against the Government on Second Reading.
  Any true Tory who considers himself to be a member of the party of Disraeli, which in an extraordinary way formed Joseph Chamberlain in the Midlands, is against centralisation and excessive Government interference and is in favour of the freedom of the individual and a balanced relationship between central and local government, must pause and ask himself whether this mass of technical nonsense—which will, at most, save only a tiny sum—is worth supporting or whether it should be consigned to the dustbin, where so much of the legislation which has occupied our time in recent years should have gone.
  The Under-Secretary of State for the Environment (Sir George Young): We have had a wide-ranging debate on new clause 6. I shall deal in passing with some of the broader points made during the debate, but it will be convenient to deal with them more comprehensively when we consider the new clauses and amendments.
  There is a fundamental conflict between the arguments of Conservative Members and those of the Opposition against the Bill. Some of my right hon. and hon. Friends do not think that the Bill will work. My hon. Friend the Member for Staffordshire, South (Mr. Cormack) said that the Bill would increase public expenditure. My hon. Friend the Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) said that it would not save public expenditure. My right hon. and learned Friend the Member for Hexham (Mr. Rippon) also said that it would not save public expenditure. My right hon. Friend the Member for Daventry (Mr. Prentice) thought that savings would be marginal.
  The Opposition's case is that the Bill will work and that there will be a substantial saving in public expenditure as a result of which local authorities will have to cut their services. That has been the thrust of their arguments in Committee and of the speech made by the hon. Member for Copeland (Dr. Cunningham), who said that the Bill would enable the Secretary of State to reduce local government expenditure below the level which elected councillors would fix. There is a fundamental conflict between those two arguments against the Bill — both cannot be true. There is a conflict between my right hon. and hon. Friends and the Opposition about the impact of the Bill.
  The Opposition enjoy this new clause because they have introduced it several times. They have asked why it is necessary to have three separate expenditure figures. I

  171
  agree that life would be simpler if there were only one target or expenditure level, but for reasons which I shall explain that would not be fair. I shall outline briefly why it is necessary to have three different figures.
  First, grant-related expenditure is a yardstick for use in the distribution by the Government of the block grant. It is an assessment of the cost to an authority of providing in its area services to a typical standard in the light of its statutory functions and its objectively recorded circumsances. It is those attributes of GRE which, we have argued, make it suitable as a yardstick for high levels of spending in relation to local needs.
  We have always accepted that GREs are not expenditure targets. When it became necessary to introduce individual targets, it was on a different basis and we confirmed the new arrangements in a statute. As the Local Government Finance Act 1982 makes clear, the purpose of the targets is to achieve the reduction in the level of local authority expenditure which the Secretary of State thinks necessary, having regard to general economic conditions. As that is their purpose, it follows that targets must be based more on an authority's historic spending levels. In that sense they are different from the GREs, which are based on a notional assessment and are not affected by the authority's historic level of spending.
  The targets have been set by a formula, which has been changed over the years and has included a variety of constraints on authorities' year-on-year increases. Bigger increases have been implied by targets for low-spending authorities than for authorities which have exceeded the GREs and the targets in previous years. The targets are, in the Secretary of State's judgment, the amounts at which he could reasonably ask each authority to aim in order to meet the Government's overall expenditure plans.
  Authorities have the ability to overspend the target figure at the cost of grant holdback and, therefore, higher rate bills. The targets and GREs are two different figures. GREs are determined for the purpose of a fair distribution of block grant, and targets in an attempt to ensure that overall spending plans are achieved.
  The House should note that to substitute the higher of the two—the target or GRE—would have significant effects on the distribution of the block grant. That is the impact of new clause 6. If we were to accept it, it would significantly reduce the rates of authorities with targets most above their GREs by increasing their grant at the expense of other authorities. My hon. Friends who spoke in favour of the new clause should know that it would give more money to extravagant authorities and, as a consequence, less money to those which have been spendng more responsibly.
  The GREs and the targets therefore perform quite different functions, as do the targets and the expenditure levels set under the Bill for rate limitation purposes.
  Mr. Straw: The Minister may have misunderstood the purpose of the new clause. It is to ascertain the relationship not just between target and GRE but between target, GRE and the maximum expenditure levels that can be prescribed under both the selective and the general scheme. Will the Minister come on to that part of his brief if he has been briefed on that? In any event, will he say whether it is possible for the expenditure level on which the authority will be rate-capped to be less than its GRE or its target?
  Sir George Young: The hon. Member for Copeland asked those questions earlier and I was about to deal with them. I note, however, that the hon. Member for Blackburn (Mr. Straw) has not disagreed with what I have said so far.
  The expenditure levels set under the Bill, unlike the targets, feed straight into the rate limit so that effectively authorities cannot exceed them. Whereas the targets can at present be exceeded, albeit at the cost of higher rates, the expenditure levels set under the Bill cannot. Precisely because they cannot be exceeded, the Bill provides for a redetermination procedure allowing the Secretary of State to take account of particular local circumstances of individual authorities. In setting targets, however, he cannot do that but must calculate them on principles applicable to all authorities. Thus, a local authority's target must be based on a general principle and can be exceeded, but the expenditure level under the Bill may take account of particular circumstances and cannot be exceeded. Those important differences may well result in different targets and expenditure levels being set with good reason for a particular authority.
  The first specific question put to me was whether the total expenditure levels would be given in the Government public expenditure plan. The totals will be included in the total of relevant expenditure for the rate support grant settlements, which in turn will be included in the public expenditure White Papers.
  Secondly, I was asked whether the total of the expenditure levels set was likely to be higher than the total of the GREs or of the targets. I think that that was the point to which the hon. Member for Blackburn referred. It depends on how expenditure levels are eventually set under the Bill, after redetermination if necessary. If they are higher than the GREs or the targets — and there could be good reasons for that — the total published expenditure levels in the White Paper would also be higher. I remind the House, however, that the actual expenditure of the highest spenders will be reduced as a result of the Bill.
  Mr. Straw: Will the Minister give way?
  Sir George Young: Perhaps I may just deal with the last question that was put to me.
  I was asked what was the logic of penalising, expenditure above targets but below the expenditure levels set under the Bill. The answer is that it would be most unfair not to do so. The question presupposes the continuation of targets after the introduction of the general rate limitation scheme, but the scheme applies only to authorities whose expenditure is above target.
  If grant holdback is not applied to expenditure above target, albeit below the expenditure level set, the authority would be treated exceptionally favourably and would not suffer the penalties suffered by those not selected. As both the targets and the holdback must be calculated in accordance with general principles, it would be unreasonable to treat expenditure levels for rate-capping purposes under the Bill in a different way as the expenditure targets must be fixed on general principles and it would be wrong to exempt from holdback those authorities which were selected under the scheme.
  I have tried to deal in the time at my disposal with the rather technical questions that have been put to me. Given the consequences of the new clause for authorities which have budgeted responsibly, I ask the House to reject it.
  5.45 pm
  Mr. Straw: First, we do not accept that the new clause will have the consequences claimed by the Minister. It certainly does not lie in the Government's mouth to complain about the way in which the rate support grant system, GRE and target may capriciously affect individual authorities which have in no way overspent, because that is the fault of the present system. We do not intend to be damned by a system which we wholly reject and wish to see entirely reformed, as do many Conservative Members who are true to their manifesto.
  I hope that Conservative Members will weigh with care what the Minister has said, and also what he has not said. He has admitted today for the first time that it is possible for the Government, under part II of the Bill—the new clause affects the general power as much as the specific power—to set the maximum expenditure level for every authority in which the total expenditure level in aggregate is less than the target expenditure which the Government say the authority should spend and less than the GRE, which is the Government's assessment of what the authority actually needs.
  Mr. Waldegrave: He did not say that.
  Mr. Straw: With great respect, he did. He said that if the expenditure levels were higher than the GRE and target certain things would follow, but he refused to give a categorical guarantee that in every case the expenditure levels would in fact be higher than target or the GRE. If the hon. Gentleman wishes to intervene, I shall be delighted to give way.
  Sir George Young: I can only repeat what I said. They could indeed be higher. I never said anything about them being lower. The circumstances would have to be rather unusual for them to be lower.
  Mr. Straw: As we all understand the English language, I assume that if they could be higher they could also be lower. If the Minister is saying that there are no circumstances in which the expenditure levels would be lower than target or the GRE, I should be delighted to allow him the opportunity to correct the record. Until he does so, hon. Members on both sides must assume, as he has just admitted, that this could occur — albeit in unusual circumstances. We have heard the word "unusual" many times in the past four years. We were told only two years ago not just that it was unusual but that it would never happen that individual authorities' expenditure levels and rate levels would be cut—and yet here we are. My hon. Friend the Member for Copeland (Dr. Cunningham) reminds me that we were also told that the counties would not be penalised, but all the Tory counties as well as the Labour counties are now screaming.
  The right hon. and learned Member for Hexham (Mr. Rippon) discussed whether setting expenditure levels—in other words, rate-capping — for a handful of authorities would allow the Government to achieve the savings that they want. There is no divergence of view between us on that. We are certain that if 20 or so authorities are rate-capped their services will suffer very badly—no doubt Conservative Members in the main would agree with that — depending on the extent to which they were rate-capped. Conservative Members are saying that, despite all that suffering by the authorities concerned, the Government will not obtain the saving that
  174
  they wish. That is the key point. There is a confluence, not a divergence, of opinion between the two sides on that. We agree that the Bill will do great damage to at least 20 authorities but that if only 20 authorities are rate-capped the savings sought by the Government cannot be achieved.
  Mr. Waldegrave: Is the hon. Gentleman saying that if 20 authorities are capped and their expenditure is reduced total public expenditure will not fall?
  Mr. Straw: The key question in terms of the PSBR is what happens to the Government's grant. We can all do the arithmetic, and the Treasury has benefited from penalty and from target. It has made money out of these items. The Secretary of State admitted that if rate-capping operated there would be more rate support grant and therefore a lower rate increase than would otherwise be the case for the authorities that were rate-capped.
  Mr. Waldegrave: The hon. Gentleman makes my point for me. We would be delighted if the Treasury had to pay out more grant than it ends up paying each year, for that would mean that the total of public expenditure was met because there was no holdback.
  Mr. Straw: I am delighted to accept the hon. Gentleman's flattery, but I was making a different point. The central point that we are making, and which Conservative Members are making, is that only 20 authorities are rate-capped and that, accepting that they are not proposing to abolish all services in Islington, Manchester and Sheffield, the most by which even this Government could contemplate effective cuts in any one year would be about 5 per cent. There is no way in which the Government, by making cuts of that size for the hit-list authorities, could achieve the £1·5 billion reductions which the public expenditure White Paper postulates. If my arithmetic is wrong, I shall be happy to hear what the Under-Secretary has to say. He knows this to be the case. The Government cannot possibly achieve their savings, and the Secretary of State has accepted that.
  To reply to the right hon. and learned Member for Hexham, I asked the Secretary of State—and he was kind enough to acknowledge that I asked him on notice, so he had time to consider it—whether, in determining the operation of selective rate-capping, he would start from having been given a target for savings by the Treasury or from his own assessment of the individual authorities' level of spending. He said:
  "There is no question of criteria being chosen which would produce the right list of authorities, whether in political terms or in relation to a pre-determined requirement for savings. Those considerations would be irrelevant." — [Official Report, Standing Committee G, 21 February 1984; c. 591.]
  The Secretary of State himself is saying that the bottom line that the Treasury is demanding is irrelevant to how individual authorities are to be rate-capped. If that is the case—and I take the Secretary of State's words as he said them—again I say that there is no way in the world in which rate-capping 20 authorities will lead to the savings which the Secretary of State demands. It will be interesting, when we come to discuss amendment No. 25, which would limit rate-capping to 20 authorities, to see whether the Secretary of State accepts that amendment or whether, as in Committee, he is implacably opposed to any limit on the number of authorities to be rate-capped under the selective scheme.
  We have heard some eloquent and courageous speeches from Conservative Members who wish to be true to the

  175
  principles of Conservatism and to the deeper and older principles of Toryism. We have heard references to Disraeli and to the former Prime Minister, the late Earl Macmillan of Stockton. One hon. Gentleman quoted Disraeli's comments against the centralisation of power. That has been a continuum within the Conservative party. It was the present Leader of the House of Commons who, after the 1979 election, told a newspaper:
  "Once you centralise power, a bad decision becomes disastrous."
  There is no better way of illustrating the wisdom of the opposition of the present Leader of the House to the centralisation of power than by considering the interrelationship between the GRE, target and expenditure levels. Given the failure of the Under-Secretary to promise that expenditure levels will in every circumstance be above the GRE and target, it is conceivable that what we have had this year and last year, whereby good Conservative authorities, which by no measure have been overspending, have found that they have been penalised even though on target, even though their level of spending is below what the Government say they need under the GRE, will be compounded by circumstances in which the expenditure levels, the rate-capping levels, are themselves set below either or both the GRE — what the Government say those authorities need — and target — what the Government say they should spend. What a mess that would be.
  Mr. W. Benyon: It would be impossible to get the savings which have been postulated in statements by the Government if the expenditure level were not below those two levels.
  Mr. Straw: I am very glad that the hon. Gentleman has made that point. That is indeed the case, so even under a wider selective scheme many authorities which are by no stretch of the imagination overspending on the Government's own criteria will be penalised in order to achieve those savings.
  We have had some references to the Under-Secretary's excellent little work, "The Binding of Leviathan", in which he complained about Ministers brandishing the theory of the detailed mandate in the face of reasoned argument. The Under-Secretary is a prolific author and, of course, he also edited the pamphlet "Changing Gear", which began with a quotation from an address by the then right hon. Harold Macmillan to the Primrose League in 1981—on the anniversary of Disraeli's death. The right hon. Gentleman said:
  "People can be governed in only two ways, either by tyranny, autocracy (whether it be of a King or of a Communist regime), or they can be governed by persuasion, by appeal to their good sense, their nature, their tradition, their inherent patriotism".
  In an earlier speech on local government, which bears re-reading by every true Tory, the same speaker, addressing a Conservative party rally on 7 March 1961, said:
  "As Tories … we believe in vigorous and effective local institutions….
  For the Government, it means transferring and diffusing authority from the centre outwards."
  That is the true Tory principle. What the Bill does is to bring power from the periphery into the centre, to centralise power. Not only is it a bad principle, but it is bad Government, and I urge every right hon. and hon. Member to vote in favour of new clause 6.
  Question put, That the clause be read a Second time:—
  The House divided: Ayes 193, Noes 301.

  Division No. 205]

  [5.55 pm

  AYES

  Adams, Allen (Paisley N)

  George, Bruce

  Alton, David

  Gilmour, Rt Hon Sir Ian

  Anderson, Donald

  Godman, Dr Norman

  Archer, Rt Hon Peter

  Hardy, Peter

  Ashley, Rt Hon Jack

  Harman, Ms Harriet

  Atkinson, N. (Tottenham)

  Harrison, Rt Hon Walter

  Bagier, Gordon A. T.

  Hart, Rt Hon Dame Judith

  Banks, Tony (Newham NW)

  Haynes, Frank

  Barnett, Guy

  Healey, Rt Hon Denis

  Beaumont-Dark, Anthony

  Hogg, N. (C'nauld & Kilsyth)

  Beckett, Mrs Margaret

  Holland, Stuart (Vauxhall)

  Beith, A. J.

  Home Robertson, John

  Bell, Stuart

  Howells, Geraint

  Benn, Tony

  Hoyle, Douglas

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

  Hughes, Robert (Aberdeen N)

  Benyon, William

  Hughes, Roy (Newport East)

  Bidwell, Sydney

  Hughes, Sean (Knowsley S)

  Blair, Anthony

  Hughes, Simon (Southwark)

  Boothroyd, Miss Betty

  Jenkins, Rt Hon Roy (Hillh'd)

  Bray, Dr Jeremy

  John, Brynmor

  Brown, Gordon (D'f'mline E)

  Johnston, Russell

  Brown, Hugh D. (Provan)

  Jones, Barry (Alyn & Deeside)

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

  Kaufman, Rt Hon Gerald

  Brown, Ron (E'burgh, Leith)

  Kennedy, Charles

  Bruce, Malcolm

  Kirkwood, Archibald

  Buchan, Norman

  Lambie, David

  Callaghan, Jim (Heyw'd & M)

  Lamond, James

  Campbell-Savours, Dale

  Lewis, Ron (Carlisle)

  Canavan, Dennis

  Lewis, Terence (Worsley)

  Carlile, Alexander (Montg'y)

  Litherland, Robert

  Carter-Jones, Lewis

  Lloyd, Tony (Stretford)

  Cartwright, John

  Loyden, Edward

  Clark, Dr David (S Shields)

  McCartney, Hugh

  Clarke, Thomas

  McDonald, Dr Oonagh

  Clay, Robert

  McGuire, Michael

  Cocks, Rt Hon M. (Bristol S.)

  McKay, Allen (Penistone)

  Cohen, Harry

  McKelvey, William

  Coleman, Donald

  Mackenzie, Rt Hon Gregor

  Concannon, Rt Hon J. D.

  Maclennan, Robert

  Conlan, Bernard

  McNamara, Kevin

  Cook, Frank (Stockton North)

  McTaggart, Robert

  Cook, Robin F. (Livingston)

  McWilliam, John

  Corbett, Robin

  Madden, Max

  Corbyn, Jeremy

  Marek, Dr John

  Cormack, Patrick

  Marshall, David (Shettleston)

  Cowans, Harry

  Martin, Michael

  Crowther, Stan

  Mason, Rt Hon Roy

  Cunningham, Dr John

  Maxton, John

  Dalyell, Tam

  Maynard, Miss Joan

  Davies, Rt Hon Denzil (L'lli)

  Meadowcroft, Michael

  Davies, Ronald (Caerphilly)

  Meyer, Sir Anthony

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

  Michie, William

  Deakins, Eric

  Mikardo, Ian

  Dewar, Donald

  Millan, Rt Hon Bruce

  Dixon, Donald

  Miller, Dr M. S. (E Kilbride)

  Dubs, Alfred

  Mitchell, Austin (G't Grimsby)

  Dunwoody, Hon Mrs G.

  Morris, Rt Hon J. (Aberavon)

  Eadie, Alex

  Morrison, Hon C. (Devizes)

  Eastham, Ken

  Nellist, David

  Edwards, Bob (Wh'mpt'n SE)

  O'Neill, Martin

  Ellis, Raymond

  Orme, Rt Hon Stanley

  Evans, John (St. Helens N)

  Park, George

  Ewing, Harry

  Parry, Robert

  Fatchett, Derek

  Patchett, Terry

  Field, Frank (Birkenhead)

  Pavitt, Laurie

  Fields, T. (L'pool Broad Gn)

  Pendry, Tom

  Fisher, Mark

  Penhaligon, David

  Flannery, Martin

  Pike, Peter

  Foot, Rt Hon Michael

  Powell, Raymond (Ogmore)

  Forrester, John

  Prentice, Rt Hon Reg

  Foster, Derek

  Prescott, John

  Foulkes, George

  Radice, Giles

  Fraser, J. (Norwood)

  Randall, Stuart

  Freeson, Rt Hon Reginald

  Redmond, M.

  Freud, Clement

  Rees, Rt Hon M. (Leeds S)

  Garrett, W. E.

  Richardson, Ms Jo

  177

  Rippon, Rt Hon Geoffrey

  Stott, Roger

  Roberts, Allan (Bootle)

  Strang, Gavin

  Roberts, Ernest (Hackney N)

  Straw, Jack

  Robertson, George

  Thomas, Dafydd (Merioneth)

  Robinson, G. (Coventry NW)

  Thomas, Dr R. (Carmarthen)

  Rogers, Allan

  Thompson, J. (Wansbeck)

  Rooker, J. W.

  Thorne, Stan (Preston)

  Ross, Ernest (Dundee W)

  Tinn, James

  Rowlands, Ted

  Torney, Tom

  Ryman, John

  Wardell, Gareth (Gower)

  Sedgemore, Brian

  Wareing, Robert

  Sheerman, Barry

  Weetch, Ken

  Sheldon, Rt Hon R.

  Welsh, Michael

  Shore, Rt Hon Peter

  White, James

  Short, Ms Clare (Ladywood)

  Williams, Rt Hon A.

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

  Winnick, David

  Silkin, Rt Hon J.

  Woodall, Alec

  Skinner, Dennis

  Young, David (Bolton SE)

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

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

  Tellers for the Ayes:

  Soley, Clive

  Mr. James Hamilton and Mr. Lawrence Cunliffe.

  Spearing, Nigel

  Steel, Rt Hon David

  NOES

  Adley, Robert

  Corrie, John

  Aitken, Jonathan

  Couchman, James

  Alexander, Richard

  Cranborne, Viscount

  Alison, Rt Hon Michael

  Currie, Mrs Edwina

  Amery, Rt Hon Julian

  Dickens, Geoffrey

  Ancram, Michael

  Dicks, Terry

  Arnold, Tom

  Dorrell, Stephen

  Ashby, David

  Douglas-Hamilton, Lord J.

  Aspinwall, Jack

  Dover, Den

  Atkins, Robert (South Ribble)

  du Cann, Rt Hon Edward

  Atkinson, David (B'm'th E)

  Dunn, Robert

  Baker, Rt Hon K. (Mole Vall'y}

  i Durant, Tony

  Baker, Nicholas (N Dorset)

  Eggar, Tim

  Baldry, Anthony

  Emery, Sir Peter

  Banks, Robert (Harrogate)

  Evennett, David

  Bellingham, Henry

  Eyre, Sir Reginald

  Bendall, Vivian

  Fallon, Michael

  Bennett, Sir Frederic (T'bay)

  Farr, John

  Best, Keith

  Favell, Anthony

  Bevan, David Gilroy

  Fenner, Mrs Peggy

  Biffen, Rt Hon John

  Finsberg, Sir Geoffrey

  Biggs-Davison, Sir John

  Fletcher, Alexander

  Blaker, Rt Hon Sir Peter

  Fookes, Miss Janet

  Bonsor, Sir Nicholas

  Forman, Nigel

  Boscawen, Hon Robert

  Forsyth, Michael (Stirling)

  Bottomley, Peter

  Fowler, Rt Hon Norman

  Bowden, Gerald (Dulwich)

  Fox, Marcus

  Boyson, Dr Rhodes

  Fraser, Peter (Angus East)

  Braine, Sir Bernard

  Freeman, Roger

  Brandon-Bravo, Martin

  Fry, Peter

  Bright, Graham

  Gale, Roger

  Brittan, Rt Hon Leon

  Galley, Roy

  Brown, M. (Brigg & Cl'thpes)

  Gardiner, George (Reigate)

  Browne, John

  Gardner, Sir Edward (Fylde)

  Bruinvels, Peter

  Glyn, Dr Alan

  Bryan, Sir Paul

  Goodhart, Sir Philip

  Buck, Sir Antony

  Goodlad, Alastair

  Budgen, Nick

  Gorst, John

  Burt, Alistair

  Gow, Ian

  Butcher, John

  Gower, Sir Raymond

  Butterfill, John

  Grant, Sir Anthony

  Carlisle, John (N Luton)

  Greenway, Harry

  Cariisle, Kenneth (Lincoln)

  Gregory, Conal

  Carttiss, Michael

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

  Chalker, Mrs Lynda

  Griffiths, Peter (Portsm'th N)

  Chapman, Sydney

  Grist, Ian

  Chope, Christopher

  Ground, Patrick

  Churchill, W. S.

  Grylls, Michael

  Clark, Dr Michael (Rochford)

  Gummer, John Selwyn

  Clark, Sir W. (Croydon S)

  Hamilton, Neil (Tatton)

  Clarke, Rt Hon K. (Rushcliffe)

  Hampson, Dr Keith

  Clegg, Sir Walter

  Hanley, Jeremy

  Cockeram, Eric

  Hannam, John

  Colvin, Michael

  Harvey, Robert

  Cope, John

  Haselhurst, Alan

  178

  Havers, Rt Hon Sir Michael

  Moore, John

  Hawkins, Sir Paul (SW N'folk)

  Morris, M. (N'hampton, S)

  Hawksley, Warren

  Morrison, Hon P. (Chester)

  Hayes, J.

  Moynihan, Hon C.

  Hayhoe, Barney

  Mudd, David

  Hayward, Robert

  Murphy, Christopher

  Heathcoat-Amory, David

  Neale, Gerrard

  Heddle, John

  Nelson, Anthony

  Henderson, Barry

  Neubert, Michael

  Higgins, Rt Hon Terence L

  Newton, Tony

  Hill, James

  Nicholls, Patrick

  Hind, Kenneth

  Norris, Steven

  Hirst, Michael

  Onslow, Cranley

  Hogg, Hon Douglas (Gr'th'm)

  Oppenheim, Philip

  Holland, Sir Philip (Gedling)

  Oppenheim, Rt Hon Mrs S.

  Holt, Richard

  Ottaway, Richard

  Hooson, Tom

  Page, John (Harrow W)

  Hordern, Peter

  Page, Richard (Herts SW)

  Howard, Michael

  Parris, Matthew

  Howarth, Gerald (Cannock)

  Patten, John (Oxford)

  Howell, Rt Hon D. (G'ldford)

  Pattie, Geoffrey

  Howell, Ralph (N Norfolk)

  Pawsey, James

  Hubbard-Miles, Peter

  Peacock, Mrs Elizabeth

  Hunt, David (Wirral)

  Pink, R. Bonner

  Hunt, John (Ravensbourne)

  Pollock, Alexander

  Hunter, Andrew

  Porter, Barry

  Hurd, Rt Hon Douglas

  Powell, William (Corby)

  Irving, Charles

  Powley, John

  Jenkin, Rt Hon Patrick

  Price, Sir David

  Jessel, Toby

  Proctor, K. Harvey

  Johnson-Smith, Sir Geoffrey

  Rathbone, Tim

  Jones, Gwilym (Cardiff N)

  Rees, Rt Hon Peter (Dover)

  Jones, Robert (W Herts)

  Renton, Tim

  Kershaw, Sir Anthony

  Rhodes James, Robert

  King, Roger (B'ham N'field)

  Ridsdale, Sir Julian

  King, Rt Hon Tom

  Roberts, Wyn (Conwy)

  Knight, Gregory (Derby N)

  Robinson, Mark (N'port W)

  Knight, Mrs Jill (Edgbaston)

  Roe, Mrs Marion

  Knowles, Michael

  Rossi, Sir Hugh

  Lamont, Norman

  Rost, Peter

  Lang, Ian

  Rowe, Andrew

  Latham, Michael

  Rumbold, Mrs Angela

  Lawler, Geoffrey

  Ryder, Richard

  Lawrence, Ivan

  Sackville, Hon Thomas

  Lawson, Rt Hon Nigel

  Sainsbury, Hon Timothy

  Leigh, Edward (Gainsbor'gh)

  St. John-Stevas, Rt Hon N.

  Lennox-Boyd, Hon Mark

  Sayeed, Jonathan

  Lester, Jim

  Shaw, Sir Michael (Scarb')

  Lilley, Peter

  Shelton, William (Streatham)

  Lloyd, Ian (Havant)

  Shepherd, Colin (Hereford)

  Lloyd, Peter, (Fareham)

  Shepherd, Richard (Aldridge)

  Lord, Michael

  Silvester, Fred

  Lyell, Nicholas

  Sims, Roger

  McCrindle, Robert

  Skeet, T. H. H.

  McCurley, Mrs Anna

  Smith, Sir Dudley (Warwick)

  Macfarlane, Neil

  Smith, Tim (Beaconsfield)

  MacKay, Andrew (Berkshire)

  Soames, Hon Nicholas

  MacKay, John (Argyll & Bute)

  Spencer, Derek

  Maclean, David John.

  Spicer, Michael (S Worcs)

  McQuarrie, Albert

  Stanbrook, Ivor

  Major, John

  Stanley, John

  Malins, Humfrey

  Steen, Anthony

  Malone, Gerald

  Stern, Michael

  Maples, John

  Stevens, Lewis (Nuneaton)

  Marland, Paul

  Stevens, Martin (Fulham)

  Marlow, Antony

  Stewart, Allan (Eastwood)

  Maude, Hon Francis

  Stewart, Andrew (Sherwood)

  Mawhinney, Dr Brian

  Stewart, Ian (N Hertf'dshire)

  Maxwell-Hyslop, Robin

  Stokes, John

  Mayhew, Sir Patrick

  Stradling Thomas, J.

  Mellor, David

  Sumberg, David

  Merchant, Piers

  Tapsell, Peter

  Miller, Hal (B'grove)

  Taylor, Teddy (S'end E)

  Mills, lain (Meriden)

  Temple-Morris, Peter

  Mills, Sir Peter (West Devon)

  Terlezki, Stefan

  Miscampbell, Norman

  Thomas, Rt Hon Peter

  Mitchell, David (NW Hants)

  Thompson, Donald (Calder V)

  Moate, Roger

  Thompson, Patrick (N'ich N)

  Monro, Sir Hector

  Thornton, Malcolm

  Montgomery, Fergus

  Townend, John (Bridlington)

  179

  Townsend, Cyril D. (B'heath)

  Wells, Bowen (Hertford)

  Tracey, Richard

  Wells, John (Maidstone)

  Trotter, Neville

  Wheeler, John

  van Straubenzee, Sir W.

  Whitney, Raymond

  Vaughan, Sir Gerard

  Wilkinson, John

  Waddington, David

  Winterton, Mrs Ann

  Wakeham, Rt Hon John

  Winterton, Nicholas

  Waldegrave, Hon William

  Wolfson, Mark

  Walker, Bill (T'side N)

  Wood, Timothy

  Walker, Rt Hon P. (W'cester)

  Woodcock, Michael

  Waller, Gary

  Yeo, Tim

  Walters, Dennis

  Young, Sir George (Acton)

  Ward, John

  Younger, Rt Hon George

  Wardle, C. (Bexhill)

  Warren, Kenneth

  Tellers for the Noes:

  Watson, John

  Mr. Carol Mather and Mr. Tristan Garel-Jones.

  Watts, John

  Question accordingly negatived.

New Clause 10

  REPRESENTATIONS TO THE SECRETARY OF STATE
  `(1) A designated authority may at any time make representations to the Secretary of State in connection with expenditure levels which may be or may have been determined or any maximum rate or precept which may be or may have been prescribed by him for that authority under sections 3 or 4 of the Act and the Secretary of State shall reply in writing to such representations.
  (2) Representations made by a designated authority under this section may relate to services provided and charges levied by them and any reply to such representations by the Secretary of State shall include a statement of any services of the designated authority which may in his opinion be curtailed or any charges which may be increased.'.—[Mr. Straw.]
  Brought up, and read the First time.
  Motion made, and Question proposed, That the clause be read a Second time.—[Mr. Straw.]
  Mr. Allan Roberts: The new clause relates to consultation and the right of local authorities to make representations to the Secretary of State about expenditure and services that have been rate-capped during the year in which a local authority has been rate-capped. It requires the Secretary of State to listen to arguments from the local authority about the consequences of rate-capping and how the capping exercise is affecting the services and the people who live in the area.
  The new clause would improve the Bill by enabling the Government to demonstrate that their mind was not closed to representations from local authorities. In Committee, every amendment seeking more consultation or the right to make representations was rejected by the Government. In the light of the feeling in the House—the only speech that supported the Bill on the last new clause came from the Government Front Bench — and the weight of opinion in the Conservative party and in the country, in both Conservative-controlled and Labour-controlled areas, I hope that the Government will accept the new clause.
  The Government are getting themselves into difficulties with this legislation. I described the Bill earlier as a bunker. They are in the bunker of this rate-capping Bill — or, as it has been described by Conservative Members, this knee-capping Bill—and they are under siege from all quarters, including their own supporters and Conservative-controlled local authority associations. As they refuse to accept the reasonable amendments asking for consultation and discussion in a democratic manner, they get deeper and deeper into the bunker.
  180
  If the Government do not accept this new clause, they will be taking on power without responsibility. In this legislation, particularly in the general powers, they are virtually usurping local government democracy and the democratic functions of local authorities to determine their own expenditure, rates and services. If they take those draconian powers, they should at least have the safeguard of allowing local authorities, which know their own areas and the views of the people who live there about the cuts in services, to make representations. Unless the Government believe in power without responsibility, they will accept the new clause.
  With the rate-capping Bill now going through Parliament, the Government and the Conservative party are getting into a unique position. They are being blamed for the cuts in services and the rate increases that local authorities are having to impose. In the past, when the Government have imposed cuts or restrictions or reductions in rate support grant on local authorities, they have managed somehow to get many electors to blame their own local authorities for those increases and cuts. Now it is becoming clear who is responsible, and the Government have brought that on themselves.
  6.15 pm
  The hon. Member for Crosby (Mr. Thornton) appeared on a television programme with me and argued in favour of Liverpool city council making people redundant, cutting services and increasing rates. It was delightful to hear a Conservative Member arguing in favour of rate increases instead of allowing the rate increases that his Government are imposing on local authorities such as Liverpool to be passed on through the local authority in the hope that it will be blamed for them.
  Do the Government intend to tell local authorities the exact amount of services that should be provided in each area of concern? Do they intend to detail the cuts and closures that should be made, and the posts that should be made redundant? The rate-capping exercises require the local authority to do that, and the Government should be required to consult on the matter and say, as the new clause requests, exactly where and how the rate-capped local authorities should make the cuts. The Government will be imposing the cuts, not the local authorities, although those local authorities will be required to carry them out. Will the Government say to local authorities, "We think your priorities for this year should be cuts in social services instead of in education. Do not close the learner swimming pools that the Sefton metropolitan district council closed because of cuts in rate support grant"? Will the Government go into detail in that way? If they rate-cap a local authority, on assessments that they have carried out on the services that should be applicable to that area to meet the area's needs in social services, housing, education, and so on, they should surely spell out the details of what they require. If they are just and fair, the Government will have done detailed analyses before they impose expenditure limits on a local authority through the rate-capping procedure.
  The Government claim that by rate-capping a few limited overspenders—they claim that they are Labour overspenders — they will make significant savings in public expenditure. We and the Government Back Benchers do not believe that that is possible, as is borne out by what has happened up to now under other legislation introduced by the Government to control local

  181
  government expenditure. A local authority such as Sefton, parts of which I and the hon. Member for Crosby represent, and which is a paragon of underspending virtue, is to lose £1·9 million this year in rate support grant, although the leader of that council is a supporter of the Prime Minister and her Government and claims that rate-capping the profligate authorities will provide more rate support grant in future for Sefton. He does not understand the Government's public expenditure White Paper, or the fact that the Treasury is forcing the Department of the Environment to save £1·5 billion. He does not understand that this legislation will apply to the whole of local government.
  In the name of democracy, we ask that Labour-controlled and Conservative-controlled authorities alike, all of which I predict will be rate-capped in future under this Bill, may have the right to be heard and to go to the Secretary of State to bring home to him the consequences of his actions. In that way, he will know exactly what is happening, how the services are being destroyed or cut, and the harm that is being done by this draconian legislation.
  Mr. Waldegrave: The new clause seeks to provide additional procedures for consultation on aspects of the limitation process. It would seek to provide for a designated authority to make representations at any time to the Secretary of State. However, the authority would be free to do so anyway. If it made representations, it would be the normal practice, now and in the future, for the Secretary of State—or, if not the Secretary of State, one of his Ministers—to reply to those representations.
  The hon. Member for Bootle (Mr. Roberts) will agree —this was the structure of his speech—that the sting of the new clause is in its tail. In the latter part he and his hon. Friends are trying to tempt us on to the hook of taking control in detail of the decisions within local authorities. He rather weakened his argument about the dangers that we face by putting the case—it is true and I would not wish to disagree with it — that that is largely the situation now. It has been the case for some time, whenever there have been, under any Government, cuts in local authority spending.
  In the old days it was done more by a process of consensus. When Mr. Crosland and others asked for cuts, I have no doubt that the good Tory councils which cut back, because they thought it right in the national interest so to do, blamed Mr. Crosland roundly as they were doing that. I have noticed in my present job that there is a deal of that going on, and I have had representations from Labour authorities making the very point that the hon. Member for Bootle says the Bill will initiate.
  Mr. Allan Roberts: The point is not that Labour or Conservative local authorities blame the Government of the day for cuts that they impose on them. It is whether the electorate perceives that the Government, rather than the council, are responsible for those cuts and for the rent and rate increases. In the past, Conservative Governments hve been successful in having many of their actions blamed on Labour-controlled councils. The time has arrived when the electorate has seen through that.
  Mr. Waldegrave: I suppose that it is a question of the skill of the local authority in being able to transfer the
  182
  blame. I am accepting the hon. Gentleman's argument that there is no difference of principle in terms of what happens at present. We discussed the issue at length in Committee.
  Opposition Members have argued that rate limitation necessarily involves the most detailed scrutiny by the Secretary of State of all aspects of an authority's affairs. They have strenuously sought to make a reality of that prediction by trying to compel us to come out with detailed statements about how particular councils should run their affairs.
  The line that the Government have taken on this issue, in Committee and elsewhere, is the one to which I urge my hon. Friends to remain supportive. Rate limitation is about controlling the total of rate income and, indirectly, the total of net expenditure. It is not our business to interfere with local priorities or to dictate local policies in detail. That must remain for local decision-taking.
  I am happy to accept that it would be unrealistic and wrong to replace local decisions on the local resource allocation by resource allocation from Whitehall. The Bill is not about that but about giving more powers, on which the House has voted for many years, to make effective the capacity of the House to allocate resources to the state sector as a whole.
  As the House is, in terms of attendance, down almost to those who were so faithful to these discussions in Committee, I can mention my book, about which I was rightly teased in Committee. I accept that any hon. Member who writes a book should be teased. My hon. Friend the Member for Aldershot (Mr. Critchley) once said that it was unwise to be seen reading a book in the House and that to write one was the end of any hope of preferment. I am sure that the evidence of the Committee will go to confirm what he said.
  The point which I try to make time and again in the book — hon. Members seem to have missed that by teasing me about it—is that local authorities are part of the state. In so far as I wrote a book about the difficulties of controlling the expansion of the state, controlling that part of the leviathan which happens to fall, for historical reasons, to be controlled not by this House but by local authorities, is just as much part of the state as are those matters which are controlled directly from this House.
  Mr. Straw: Is that what the Minister had in mind in his book when, at page 149, he wrote:
  "Conservative governments must seek to bring back the role of the state within its proper limits and assist in every way the nurture of necessary communities in which alienated individuals can live."
  Mr. Waldegrave: Absolutely. I am tempted to go on at tedious length about this issue because the high spending local authorities which have knocked out the centres of cities by high local taxation are exactly the aspects that have done so much to destroy communities, not only with their planning policies and buildings, which people now hate to live in, but with their high taxation policies which drive employment away.
  It is important to remember that the Bill is not about involving us in the details of the local resource allocation but about giving some reality to overall decisions on what resources are to be taken by the state in the wider sense, including allocations to local authorities. The votes that have taken place for many years in the House about the levels of public expenditure have, in that respect, always been something of a sham, because that part of public

  183
  expenditure which falls to local authorities to control has always been to some extent a bluff. The control of that is what the Bill is about, not about the detailed allocation of resources or priorities within the services which fall to local authorities.
  We shall be asking for reasonable economies. It must be a matter for the local authority concerned to decide whether it wishes to make the necessary savings by greater efficiency or by bringing service spending to a more normal level because, by definition, in the selective scheme we are talking about authorities which are spending much more on services than are other authorities.
  Mr. Michael Meadowcroft: Is the Minister not contradicting himself? Earlier he said that it was not the object of the Bill to encourage detailed scrutiny by the Secretary of State of individual local authorities. Now he is saying that the selective scheme is designed to look at the overspending on services of local authorities. Which is it to be? Is it to be a general spending curtailment or a scrutiny of the services of individual authorities?
  Mr. Waldegrave: There has been no contradiction. The Secretary of State will select those authorities which, by broad indicators, are spending much more on services than are others so that the totals add up to much more than is spent elsewhere. But it is then up to local people to set the priorities within the limits that are set. In a sense, the fact that the new clause has been tabled — to try to involve us in local decision-taking—only reminds us that the key decisions on priorities will remain to be taken locally under the Bill as drafted.
  The expenditure reductions that we shall be seeking will themselves be reasonable. If they are not thought to be reasonable, the authority concerned will be able to make its case in as much detail as it wishes and, if he is convinced, the Secretary of State will be able to re-determine the expenditure level at a higher figure. While, therefore, I understand the political purpose of the new clause, I have little hesitation in urging the House to reject it.
  Question put and negatived.

New Clause 11

  RATE OF GROWTH IN LOCAL GOVERNMENT EXPENDITURE
  'This Act shall be inoperative in a financial year if, over the period of the previous five financial years, the rate of growth in the total of local authority spending has not exceeded the rate of inflation in local authority costs, or the rate of growth of total expenditure by Her Majesty's government, whichever is the greater.'.—[Mr. Straw.]
  Brought up, and read the First time.
  Mr. Straw: I beg to move, That the clause be read a Second time.
  In view of other debates which must take place before the guillotine falls at 8 o'clock, I shall be brief. The rhetoric of the Government and their supporters suggests that a large number of Labour authorities have been wholly, to use the hurrah word, "profligate" in their expenditure, and the Under-Secretary often adds the adjective "irresponsible".
  6.30 pm
  The London borough of Lewisham has been the subject of vulgar abuse from Conservative Members representing Lewisham constituencies, and from others. I am sorry that the hon. Member for Lewisham, West (Mr. Maples) is not
  184
  here, because I gave him notice that I intended to refer to him. I gave similar notice to the hon. Member for Derbyshire, South (Mrs. Currie).
  In the debate on 14 December 1983 the hon. Gentleman asked the Secretary of State whether he was aware that his authority—
  "One of the bad 16" — [Official Report, 14 December 1983; Vol. 50, c. 1015.]
  not only employed a borough artist but spent £130,000 a year on sexism awareness training. On 21 December 1983 the hon. Member for Derbyshire, South asked the Secretary of State to:
  "study the accounts of the London borough of Lewisham, which invested £100,000 of ratepayers' money in a commercial pantomime and then censored the text".—[Official Report, 21 December 1983; Vol. 51, c. 422.]
  In answer to those questions the Secretary of State described Lewisham as a loony Left council and as a high-spending authority such as those which had
  "been widely condemned by many, even by those who call themselves Labour supporters." — [Official Report, 14 December 1983; Vol. 50, c. 1015.]
  Mr. Chris Smith: On 1 March, in Standing Committee, the hon. Member for Lewisham, West (Mr. Maples) regaled us with tales of supposed overspending by the Inner London Education Authority on what he called a record-player. I checked on the matter and found that his facts were completely incorrect. His remarks were a gross slur on the authority.
  Mr. Straw: I believe that my hon. Friend is referring to the hon. Member for Lewisham, East (Mr. Moynihan). He is the smaller of the two hon. Gentlemen, but they share a common standard of vulgar abuse based on total untruths about the borough of Lewisham. The remarks of the hon. Member for Derbyshire, South are what one would expect.
  The assertions are without foundations. Lewisham did not invest £100,000 in a commercial pantomime. It put some money into a pantomime which, before taking its publicity costs into account, broke even. After those costs had been taken into account, the pantomime lost £8,000 — a very different figure from £100,000. The pantomime was enjoyed by 37,888 people, and there was no censorship of the script.
  I am glad that the Secretary of State for the Environment is here. It is simply untrue that £130,000 is spent on sexism awareness training. There is no budget for sexism awareness training in the London borough of Lewisham. Lewisham spends £20,000 on management training for women. That is a somewhat different figure and a totally different concept. The borough artist is not employed by the borough—he is self-employed. I hope that when he finally appears in the Chamber the hon. Member for Lewisham, West will withdraw his gross slurs on Lewisham council.
  Lewisham is not an overspender. It is an underspender. Since 1981–82, when the allegedly loony Left council took control, Lewisham's expenditure has risen only by 8·9 per cent. Local authority inflation has risen by 13·8 per cent. and the general retail price index by 13 per cent. The loony Left council, castigated as an overspender by the Secretary of State, has in fact underspent. It has cut its services.
  The Secretary of State for the Environment (Mr. Patrick Jenkin): Ask the ratepayers.
  Mr. Straw: The figures are in the tables. I hope that people will ask the ratepayers. The ratepayers know that if rates have gone up in Lewisham, they have gone up not because of any increase in expenditure in the past two years — in real terms, the Secretary of State's own figures show that expenditure has gone down — but because of the cuts in rate support grant imposed by the Secretary of State. We will ensure that the Secretary of State's remark goes through the letter-box of every household in Lewisham.
  The Secretary of State may have lost the Lilley table, but I looked it up today. As I have said, for 1981–82 to 1983–84 the figure is 8·91 per cent., compared with increases in pay and prices for all local authorities of 13 per cent. and an increase of 13·8 per cent. in the RPI.
  Mr. Patrick Jenkin: On the latest information available to us, Lewisham is now budgeting 7 per cent. ahead of its target and, not surprisingly, is to have a 32 per cent. rate increase. That is what the hapless ratepayers of Lewisham will have to face in the ensuing year. The hon. Gentleman may believe that that is a proper way to treat the ratepayers, but I differ from him.
  Mr. Straw: The improper way to treat ratepayers is to impose penalties on local authorities, including Conservative authorities, and targets which they cannot meet without savaging their services. The proof of whether an authority is overspending or underspending—as the Secretary of State himself has admitted in other debates —is not the level of its rate increases, which are very much dependent on changes in rate support grant, but the level of its expenditure increases. On the Secretary of State's own figures, Lewisham's expenditure has been reduced in the last two years in real terms.
  Lewisham has been castigated as a high spender, but, if its rates have gone up, that is a direct result of the cuts in the Government's rate support grant, which the Conservative-controlled ACC has said was wholly responsible for the excess of rate increases above the level of inflation.
  The expenditure of a whole range of authorities which are due for rate-capping is either less than the RPI over the past four years or less than the increase in central Government expenditure. We believe that, on the Government's own definition, those authorities which have spent less than the increase in central Government expenditure, or less than the increase in inflation, should not be subject to this vicious rate-capping.
  Sir George Young: The hon. Member for Blackburn (Mr. Straw) has used the new clause to settle some personal scores with two of my hon. Friends. I do not carry details about pantomimes in Lewisham in my head, and I do not therefore propose to comment on that matter. However, knowing my hon. Friends, I do not believe that they would have made those statements without carefully researching them.
  The hon. Gentleman spoke somewhat briefly to the new clause. It seeks to prevent the Bill from operating by setting up criteria which the authors of the new clause expect will not be met. I will not bore the House with the technical reasons why the new clause is unacceptable, but I should like to deal briefly with the issue of principle.
  It is not realistic to compare central Government expenditure with local government expenditure. A substantial proportion of Government spending is in the
  186
  form of transfer payments, the size of which is determined by the depth of the recession, by world markets, and by international interest rates. Their size is also determined by demographic factors, such as the ageing of the population. To some extent, elderly people also make demands on local services, but the most significant demand on local government is education. In that sphere numbers are falling quite substantially, and that presents a real opportunity for savings. Because responsibilities are different and are dictated by totally different factors, it is not realistic to put the two types of expenditure on a par and to say that they should both be increased at the same rate.
  Mr. Meadowcroft: Does the Under-Secretary accept that local authorities have a proper role in endeavouring to counter the effects of recession by, for instance, underpinning local industry, considering the local infrastructure and trying to attract new companies to the area? That perfectly proper expenditure will vary in exactly the same way as public money spent centrally.
  Sir George Young: The hon. Gentleman tempts me to a broader debate on the question whether local government has the power to take macro-economic decisions which conflict with those of central Government. My understanding is that they should not do that and that it is up to central Government to dictate the broad economic parameters which govern the country. It is not up to local councillors to introduce counter-inflationary or reflationary policies which conflict with the Government's economic policy.
  There is another reason why it is perfectly legitimate for central spending to rise faster than spending by local authorities. Central spending may be provided for in public expenditure plans. It may be devoted to policies which the Government outlined in their manifesto and on which they were returned to office.
  We made it clear that defence and the police were priorities. They are Government responsibilities. Defence is probably the case to take here. It is realistic for a Government to make it clear that they want higher spending in some areas and to provide for it. That is another reason why we cannot realistically compare the two.
  Mr. Peter Hardy: Will the Under-Secretary of State note that, in addition to the opportunities afforded to local government because of a reduction in school rolls, as a result of the effects of the recession to which he referred many parts of the country face the appalling problem of vast numbers of young people who are unemployed or will become unemployed later this year. The Minister's Department, with the Home Office, produced a circular earlier this year which suggested that local authorities should give much higher priority to provision for leisure to do all manner of things, such as diminish crime. While suggesting that local authorities do that, the Government have said that they should do it without increasing expenditure. The Government can take that unrealistic stance, but local authorities cannot. That should be considered now.
  Sir George Young: I understand the hon. Gentleman's point, but it reinforces my case as the cost of youth unemployment is borne principally by the DHSS or the Manpower Services Commission. They are Government

  187
  responsibilities. That explains why the spending of such bodies increased more quickly than that of local government, which did not have responsibilities to quite the same extent.
  I sense that the Opposition do not wish to press the new clause too hard. I have explained why it is unrealistic, and I hope that the House will reject it.
  Question put and negatived.

New Clause 12

  EFFECT ON PUBLIC SPENDING
  'The Secretary of State shall be required to bring before both Houses of Parliament in each financial year a report showing the effect on total public expenditure in the previous financial year of the operation of Parts I and II of this Act as appropriate. Such report shall include a statement of the overall saving, if any, in the previous financial year as a result of the Act'. — [Mr. Straw.]
  Brought up, and read the First time.
  Motion made, and Question proposed, That the clause be read a Second time.—[Mr. Straw.]
  Mr. Chris Smith: We have already touched on the issues that lie at the heart of new clause 12 as they relate to the Government's real purpose in bringing forward the Bill. The Government speak with a forked tongue. Sometimes they say that it is designed to curb the activities of only a handful of so-called profligate Labour-controlled authorities to introduce some efficiency and supposed sanity into their affairs, and at other times they say that it is designed to achieve reductions in public expenditure. We know that the second reason — admitted by the Under-Secretary of State today—is paramount.
  New clause 12 probes the issue a little further and challenges the Government to make the matter clear to both Houses of Parliament. Both Houses of Parliament are involved. The other place has an extremely important role to play in such constitutional matters and I hope that it will exercise it soon. New clause 12 requires the Government to bring before both Houses of Parliament a report on the overall level of savings that have been achieved by the operation of the measure. The Under-Secretary of State said that it will reduce the level of public expenditure. That is a self-evident and simplistic truth, but it ignores the balance between local expenditure that is raised through the rates and Government expenditure that is drawn on the public sector borrowing requirement. It ignores that crucial distinction that the Under-Secretary of State constantly ignored in questions that were put to him earlier. It does not reveal what the Government have consistently refused to reveal — the exact extent of reduced public expenditure that they envisage resulting from the Bill.
  The nearest guess that we had came from the Secretary of State in Committee. He constantly assures us all that he wants to rate-cap only 15 to 20 authorities. His best estimate is that, if those authorities are rate-capped, about £250 million will be saved in any one year. We should compare that £250 million with the reduced public expenditure that the Treasury envisages in local government spending in its most recent White Paper, the predictions in the Green Paper that was published on the same day as the Budget, and the extravagant claims made by some Conservative Members about the effect of the
  188
  Bill. If we make that comparison, we see clearly that the £250 million falls far short of the Treasury's expectation and claims of what the Bill will achieve.
  6.45 pm
  How much money do the Government expect to save? How much of that money will come from the 15 to 20 Labour-controlled authorities which, it is claimed, are the only ones that will be rate-capped? To what extent do the Government expect the general powers to be implemented to achieve the size of savings that they expect? Will the Government put before both Houses of Parliament each year a proper report on how effective or, more probably, ineffective the Bill will be in achieving anything like the savings that have been claimed? If the claimed savings were made, the consequences would be disastrous. I hope that the Government will be honest enough to accept new clause 12 and report to Parliament properly on the impact of the Bill.
  Mr. Patrick Jenkin: The hon. Member for Islington, South and Finsbury (Mr. Smith) has rehearsed well-traversed ground which was covered at length in Committee. I do not complain about that, as it appears that he and some others still labour under the misapprehension that has been assiduously fostered by some of our critics in the national and specialist press who have argued that part. I will not achieve savings. The Opposition have consistently argued that any savings will be small or nonexistent. I refute that.
  It is interesting that the hon. Gentleman, whose debating skills we came to admire in Committee — I hope that he will allow me to say that—has changed tack remarkably. The Opposition argued consistently 3,n Committee that there would not be any savings. I took down the hon. Gentleman's words as accurately as I could. He said that we claim that the overall level of public expenditure will be reduced and described that as a self-evident and simplistic truth. He is quite right. Not only is it self-evident and simplistic, but it will happen.
  Mr. Chris Smith: The right hon. Gentleman is right, but he has completely missed my point. The point that my right hon. and hon. Friends have consistently made—I support it—is that the level of expenditure required by the Exchequer will not necessarily be reduced by the Bill.
  Earlier the Under-Secretary referred to the overall level of spending by central and local government put together. That is a supposed definition of public spending, although in economic terms it is relatively meaningless. However, under that definition the right hon. Gentleman is correct, and no Labour Member has ever denied that. We have pointed to the expenditure of the Exchequer. That would not necessarily fall.
  Mr. Jenkin: I am extraordinarily grateful to the hon. Gentleman. I am only sorry that some of my hon. Friends, who earlier cast doubt on the proposition that we would make savings, are not here to listen to him. He has properly explained the definition of public expenditure —the sum of spending by central Government and local authorities, and the borrowing requirements of the nationalised industries. That, broadly, is the definition.
  The hon. Gentleman has now acknowledged —perhaps we do not need to dwell on it—that it will be reduced by the Bill. He will remember that on Second Reading and in Committee I put forward the proposition

  189
  that had there been rate capping in 1983–84, had no more than 18 authorities been chosen, and had we sought expenditure reductions of no more than 3 per cent., we would have saved up to £350 million below what it otherwise would have been.
  As the purpose of the Bill is to keep spending below what it would otherwise be, by capping the spending and rating figures of up to 20 or so local authorities, it seems to me that the hon. Member for Islington, South and Finsbury — who approaches these matters with a freshness and intelligence that we have come to admire — has now seen the light and recognised that it will achieve savings. He has therefore conceded our point.
  The hon. Gentleman went on to say that we had declined to reveal the exact amount. Inevitably, we are precluded from doing so. First, savings can be judged only against what would have been spent had there been no rate capping. That must always be a matter of hypothesis. Secondly, we are not yet in a position to say which authorities will be selected for limitation. We will not know that until we have their full budget figures. Thirdly, we are as yet unable to give the amount by which spending would be limited. Fourthly—this is most important—it is quite impossible to quantify the shadow effect. In fact, a number of other authorities will not be selected but will keep their spending down so that they will not be selected in a future year.
  I remind the House of one of the most revealing moments in Committee, when my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Merchant) made a bull point which no hon. Member sought to refute. He said:
  "Much has been said about the deterrent effect of the general powers. It is said that the power will be important, not in its implementation, but because it could be implemented in future."
  The hon. Member for Islington, South and Finsbury will remember that he then quoted
  "from the recent budget proposals of the Newcastle city council. Paragraph 20.5 says:
  'when considering financial adjustments and the general level of expenditure the Committee should bear in mind that the "ratecaping" legislation has been given its second reading in the House of Commons and is now in its Committee stage which the Government hopes will be completed by Easter. The Secretary of State for the Environment has produced illustrative criteria by which authorities might be chosen to be capped. On the basis of 1983–84 budgets this Council—
  the Newcastle city council—
  "'fails 7 of the 11 tests quoted'."
  My hon. Friend the Member for Newcastle upon Tyne, Central rightly went on to say:
  "That illustrates that councils are already aware of the deterrent effect of this part of the Bill. Even if it is not implemented, it forms a a vital part of the Bill."—[Official Report, Standing Committee G, 8 March 1984; c. 1029–30.]
  Mr. Cowans: I am blessed with having two councils in my constituency, one of which is Newcastle upon Tyne. The right hon. Gentleman defeats his own case, because later in Committee I answered the argument of the hon. Member for Newcastle upon Tyne, Central (Mr. Merchant). Because of the Local Government, Planning and Land Act 1980, exactly the same kind of terms were contained in the budget minutes of Newcastle city council at that time. How can the right hon. Gentleman claim that Newcastle is taking account of the Bill when even he
  190
  cannot say what criteria or principles he will use? Therefore, how can he claim that Newcastle city council knows what he does not know?
  Mr. Jenkin: The hon. Gentleman must clearly bear in mind that in the document referred to by my hon. Friend the Member for Newcastle upon Tyne, Central I produced the chart which I circulated to all members of the Committee and which was made available to the press. That listed the 33 or so authorities whose spending was 20 per cent. or thereabouts over GRE as well as a whole series of tests. Even though Newcastle city council did not know, the point was made that it failed seven of the 11 tests, and the city treasurer thought that that was a sufficiently important factor to bring to the notice of the finance committee when drawing up its budget and rate proposals. I have no wish to embarrass the leaders of that council, but, as is well documented in the press, it is making efforts to reduce its spending.
  As part of the savings that the Bill will produce we are, therefore, perfectly entitled to refer to the shadow effect which is likely to lead to a reduction in expenditure which the hon. Member for Islington, South and Finsbury has said is a self-evident and simplistic truth.
  That is what we will achieve. The question, therefore, is whether we need a special report—the subject of the new clause. From what I have said, I am sure that the House will recognise that it would be quite impossible to put a firm, precise or accurate figure on the savings that will be achieved. We cannot know what the level of expenditure would have been, and it is difficult to estimate the shadow effect.
  Each year the Government publish their public expenditure White Paper. That clearly shows the history of expenditure over five earlier years and gives planned figures for the future three years. The present White Paper records estimated outturn expenditure for years up to 1983–84, and the overspend represented by those figures can readily be seen when compared with earlier White Papers.
  Once rate limitation under part I has had a chance to bite, the expenditure of the highest overspending authorities will be brought under control, and that should lead to a noticeable reduction in the level of overspend reported in all the recent White Papers, or even perhaps the disappearance of that overspend altogether.
  Mr. Chris Smith: With respect, the right hon. Gentleman is trying to have his cake and eat it. On the one hand, he is saying that it is impossible to estimate the reduction in overall public expenditure which will be achieved by this legislation, and in the next breath he says that a considerable reduction in the expenditure of the high-spending authorities will be achieved. If he cannot report that each year to Parliament, as the new clause seeks to ensure, how can he confidently claim that there will be a considerable reduction?
  Mr. Jenkin: I do not think that there is very much between us. For the benefit of those of my hon. Friends who have only just come into the Chamber, I should point out that the hon. Gentleman said that the Bill would produce a reduction in the overall level of public expenditure and that that was a self-evident and simplistic truth. The Bill will reduce spending, but I cannot precisely estimate that, for the reasons that I have explained. What would otherwise happen cannot be defined and it is

  191
  difficult to quantify the shadow effect. For that reason, it is not sensible to impose on the Government an obligation to produce a precise figure, which we will have to say cannot be precise.
  However, the public expenditure White Paper will contain the figures that are the necessary raw material for people to form a judgment. Therefore, that will meet the only realistic purpose of the new clause — to enable people to form an estimate of what the savings are.
  This debate has served an admirable purpose in that we have now had from one of the most articulate Opposition spokesmen in Committee a clear recognition and acknowledgment that the Bill will produce public expenditure savings. The hon. Member for Blackburn (Mr. Straw), who was commendably brief in moving the new clause—he did so formally—has served a splendid purpose, and we are grateful to him. However, I fear that I cannot advise the House to accept the new clause.
  Question put and negatived.

New clause 15

  CONSULTATION ON PRINCIPLES
  `Before the Secretary of State shall exercise the powers conferred upon him by section 2(4) and section 3(2) of this Act, he shall determine the principles specified in consultation with, and after taking into account any representations received from, such associations of local authorities as appear to him to be concerned and any local authority with whom consultation appears to him to be desirable; and such consultations shall have been undertaken not later than three months before the exercise of those powers.'.—[Mr. Straw.]
  Brought up, and read the First time.
  7 pm
  Motion made, and Question proposed, That the clause be read a Second time.—[Mr. Straw.]
  Mr. Cowans: I could not have had a better entry for this new clause than what the Secretary of State said earlier if I had planned it, because the essence of the new clause is consultation about the principle. In reply to my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith), the Secretary of State gave the Newcastle city council something that it has never had before, under any Government—the ability to see into the future. He said that the council was already implementing the Bill, but he does not know what the Bill's principles are because he has not yet worked them out. It is true that he gave a list of 11 different principles and went through all 11 of them, but at the end of the day, unlike Santa Claus, he did not leave us a present and tell us which one would apply. The idea that Newcastle city council can take account of something that the Secretary of State does not himself know about goes a little beyond even his vivid imagination.
  The little lull that the Government had when we debated the previous two new clauses will abruptly cease on this one unless the Secretary of State does what he has so far not done and accepts a new clause. We must examine the draconian powers that are being given to the Secretary of State. We mention in the new clause the powers given to the Secretary of State by clause 2(4) of the Bill. The clause provides:
  "The power to designate an authority shall be exercised in accordance with principles determined by the Secretary of State".
  It also refers to clause 3(2), which says:
  192
  "The power to determine a level for the total expenditure of a designated authority shall be exercised in accordance with principles determined by the Secretary of State".
  The common denominator between the two subsections is the fact that the Secretary of State is the person who determines the principles. Both here and in part I there is no mention of any consultation, and the principles are purely at the whim of the Secretary of State.
  In Committee, many constructive amendments were moved by the Opposition and one or two, although not many, right hon. and hon. Conservative Members likened them to wrecking amendments. Although I should like to wreck this Bill, and I am sure that there are some Conservative Members who would join me in doing so, this new clause is not meant to be a wrecking one. It talks about a basic thing that should be welcomed by the Secretary of State. There should be consultation, given the fact that the House in its wisdom will pass a Bill that allows Secretaries of State to make orders and principles outside of it, and such consultation is therefore of vital importance.
  Unlike Conservative Members, and particularly those on the Government Front Bench, we believe in democracy, and we believe that those who have to apply these principles should at least be consulted at all stages and should examine what is being done. After all, when he makes these principles, the Secretary of State will apply them to local authorities. We go out of our way to talk about the local authority associations and/or the local authority. We do not restrict consultation to local authority associations, because some local authorities are not members of associations. As the right hon. and learned Member for Hexham (Mr. Rippon) said, one authority may be completely different from another. Therefore. the new clause allows any authority to join in the consultations.
  In particular, the new clause is relevant to part I, the selective scheme. It is not new because in other parts of the Bill the Government recognise that which we are seeking to move in this new clause. However, in the selective part of the scheme, in which we have heard that two or three, or 33 or 43, authorities will be caught, there is no provision for consultation. Even the House does nor get an opportunity to examine the principles until an order is placed before it. It is vital that local authorities should have the opportunity to be consulted by the Secretary of State, and that their views should be taken into account when he, and he alone, draws up the principles. This is a basic right which is built into the Bill at another stage and it should also be in it at this stage.
  The new clause will act as a safeguard not only for local authorities but for the Secretary of State, who will be able to build in a time scale. It says:
  "such consultations shall have been undertaken not later than three months before the exercise of those powers."
  That is not an unreasonable time scale. It means that a local authority cannot drag its feet, but nor can the Secretary of State.
  The consultation procedure is all the more important because at no stage did the Committee have an opportunity to discuss those proposals, or even what the Secretary of State has in mind. If—this is a big "if"—the Secretary of State really wants local authorities to abide by and implement the principles that he draws up, should he not welcome the opportunity that this new clause provides for him? He could consult local authorities, explain to them

  193
  the principles, take account of any reservations or alterations that they may have, and explain to them fully what he has in mind. It would cut a long story short if the Secretary of State, or the Under-Secretary of State, were to leap to his feet to accept that basic principle. However, as neither of them did so in Committee, I do not expect their approach to change now.
  When the Bill was considered in Committee — it spent a comparatively long time in Committee, and that consideration could have been shorter if Ministers had had the wisdom to accept the Opposition's amendments—many questions were asked about the proposed consultative procedure. Unfortunately, very few of them were answered. With respect to the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark), I could not have bettered his contribution. He said:
  "My hon. Friend the Minister may be able to consider the amendment"—
  it was the amendment dealing with consultation—
  "quickly because it deals with something that is clearly unfair. I am sure that, awful though it is, the Bill is not intended to be any more unfair than necessary. Perhaps my hon. Friend the Minister will intervene"—
  that would have been a change—
  "to say that those about to die will at least be allowed to consult. If consultation is to be impossible anyway, we may as well all pack up and go home. If my hon. Friend can agree to the authorities being consulted, perhaps an amendment to the amendment can be hurried through and approved."
  It is clear that one Conservative Member appreciated the wisdom of the new clause. If he and the Under-Secretary of State were to move along their Benches towards each other, consultation could take place across the Gangway. If that were to happen, the new clause could meet with the Government's approval.
  Perhaps my hon. Friend the Member for Copeland (Dr. Cunningham) summed up the argument in a slightly better way than the hon. Member for Selly Oak, although I accept that he took a different approach. My hon. Friend said:
  "If the Government's intentions are not just political but intended to produce more efficient, responsive local administration, sensible discussions must take place. If they do not, and local authorities do not have that statutory safeguard, some may come to believe that the Government's real motives are not concerned with bringing about greater efficiency but simply constitute a naked attack on various authorities about which the Government are unhappy."
  It seems that the new clause gives the Secretary of State an opportunity to refute the comments of my hon. Friend the Member for Copeland, and this is an ideal opportunity to take up what the hon. Member for Selly Oak saw as an omission in the Bill, a view which was shared by my hon. Friend.
  After considerable probing the Under-Secretary of State said:
  "I have the authority of my right hon. Friend the Secretary of State to say that we shall consider, without commitment—I stress that phrase— whether we can build in a consultative provision on the principles with the associations, and whether that should be in the Bill". — [Official Report, Standing Committee G, 16 February 1984; c. 491–519.]
  After discussing for many hours what were described as wrecking amendments, even the Under-Secretary of State started to have doubts. He said that he would consider the matter. Unfortunately, there has been deafening silence
  194
  since that breakthrough. Having said in Committee that he would consider the matter, surely he should have told us on Report whether the answer was yes or no.
  7.15 pm
  The Under-Secretary of State knows that during our long debates in Committee I developed a great respect for him. However, I must remind him that he said that he would consider again the Government's approach to consultation. Since then there has been a deafening silence. I suppose that that is nothing strange because an attitude that is not directed one way or the other is very much in character with the Bill.
  Conservative Members may be thinking that a devilish plot has been dreamt up by the Labour party to undermine the principles in the Bill and the Government's proposed legislation. They may even think that they must resist the plot at all costs and take their troops through the Government Lobby to ensure that the Government vote massively against. Unfortunately, the Bill is riddled with instructions that are all one way. Local authorities are instructed to consult. In many instances the Bill seeks to enforce consultation upon authorities. In clause 13 every local authority is instructed to
  "consult persons or bodies appearing to it to be representative of industrial and commercial ratepayers in its areas about its proposals for expenditure and the financing of expenditure in the next financial year."
  That imposes consultation upon local authorities.
  In clause 9 the case of consultation is presented to us. I ask Conservative Members to put the new clause against clause 9(2). If they do so, they will find that there is not very much difference. Subsection (2) states:
  "Before making an order under this section the Secretary of State shall consult such associations of local authorities as appear to him to be concerned and any local authority with which consultation appears to him to be desirable."
  Conservative Members will find that the new clause contains identical words. The Secretary of State has said on many occasions that it will never be necessary to implement part II. In effect, he has told his right and hon. Friends "Do not worry about part II. Come into the Lobby with me and support the Bill. Part II has been included only because it may be necessary in the direst circumstances."
  Clause 11 reads:
  "Before determining levels of local expenditure under section 3 above for the authorities treated as designated by virtue of section 10 above"—
  that is the section that introduces part II—
  "the Secretary of State shall consult such associations of local authorities as appear to him to be concerned."
  If we glance at the new clause, we find that the words are identical. If the Secretary of State and those who drafted the Bill have seen fit to acknowledge a consultation procedure identical to that of the new clause, they should have a strong case for accepting the new clause. Is it sheer chance that the consultation power appears only in part II? Is part II the only part of the Bill that worries Conservative Members, as they said in today's debate? They are worried, rightly, because part II would sweep up almost all of the local authorities, including Conservative-controlled local authorities, that are caught by part I. Is it not passing strange that consultation, in the same form as new clause 15, will be necessary only when it sweeps up Conservative authorities? That is exactly what the Bill is about when it is read without the new clause. It is evident that, as soon as the Secretary of State implements the part

  195
  II that he promised never to implement to bring Conservative Members into the Lobby, consultation takes a different form. The only conclusion that I can draw is that consultation in the form that we request is good for Conservative authorities but not so good when applied to Labour authorities. In that case, too, the Secretary of State will need to put up a good case.
  How can any Government, even this one, be so blatantly biased in a Bill that is introducing legislation that might last for a long time? How can hon. Members on both sides of the House sit in the Chamber and, while not voting for the new clause, accept that consultation is good in part II but can be missed out of the remaining clauses? That is illogical, politically biased and blatant. The Secretary of State should be prepared to write the new clause into the Bill, as his case for opposing it is indefensible.
  I should like to set out one of the other reasons. Conservative Members have quoted from the Local Government, Planning and Land Act 1980. I accept that they should do so as it is a Conservative measure. I shall illustrate the difference between that Act and the nonsense being forced upon us tonight which will be forced upon local authorities later. Part I of the 1980 Act is headed:
  "Local Government Relaxation of Controls"
  The Conservative Government laid down the following words of wisdom, in section 1:
  "So much of the provisions mentioned in Schedule 1 of this Act — (a) as makes the exercise of any power of a local authority subject—(i) to a right of appeal to a Minister; or (ii) to the provisions of regulations made by a Minister; or (b) as confers upon a Minister any power to give a local authority directions or power to require a local authority to make byelaws; or (c) as requires a local authority to make any report or give any notice to a Minister, shall cease to have effect."
  That measure was introduced by the same Conservative party that is forcing this nonsensical Bill on hon. Members, which takes away their right to challenge the Government when the local authorities that they represent are given an order. The Bill is forced upon the public. All that has been done without providing an opportunity to be consulted on principles that are in the hands of one person —the Secretary of State for the Environment.
  How can any hon. Member sit here, straight-faced, and examine the case for a Bill that says that consultation is good and shall be mandatory in relation only to part II? I do not believe that Conservative Members can honestly hold their heads high and accept the principle that what is good in part II is not so good in part I, when Labour-controlled authorities will be selectively caught by it.
  After due reflection, bearing in mind his non-committal reply that he would examine the matter, the Secretary of State seemed to waver for the first time in about 30 Committee sittings. At last it seemed that the message had got through. I have two questions for the Secretary of State. First, will he tell us what happened to his promise to consider consultation, at our suggestion that it should form part of part I as well as part II? The Secretary of State could answer that question tonight and end a deafening silence. Secondly, how can the Secretary of State explain logically to the House and the public that consultation is good — and mandatory — in part II but completely ignored in part I? If he can do so, he is a better man than I thought he was. If we hear no explanation from the Secretary of State, I shall urge my right and hon. Friends to divide the House. My interpretation of the Bill and the Secretary of State's refusal to accept new clause 15 seem to be backed by my hon. Friend the Member for Copeland
  196
  (Dr. Cunningham), who argued clearly that any other course would be blatant political bias against Labour local authorities that were selectively caught by the Bill The Government have had quiet runs on the two previous new clauses, but unless the Secretary of State accepts new clause 15 we shall divide the House.
  Mr. Meadowcroft: One of the amazing things about the Bill is that after many hours spent considering it we have heard only vague assertions of the principles on which the Secretary of State bases rate-capping, either for the 12 to 20 authorities or under the general scheme. A detailed case on which local authorities could base their case against rate-capping has not been put forward.
  The debate on a previous new clause included a speech by the Secretary of State in which he said that the Government should not scrutinise local authorities in detail, as that was a job for the local authorities themselves. He said that the Government were trying to stop gross overspending on services. However, the Committee never went beyond the suggestion of what services would be singled out for gross overspending or whether a balance could be struck between different services on which local authorities should consider concentrating their resources.
  7.30 pm
  From the debate on which of the three limits would be paramount, we now know that the GRE limit will not be paramount. The target will not be paramount. A third limit will be set solely on the say-so of the Secretary of State, on principles determined entirely by him. The local authorities thus caught will not be able to determine how on earth they can avoid it, because there is no guidance within the principles that are laid down.
  One is forced inexorably to the conclusion that the Bill is not about rates; that it is simply a piece of spite against local authorities which do not happen to elect Conservative councillors. It is about the political balance between the Government and local authorities. It is not about the spending of local authorities.
  The hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) referred to the legitimate fears of some Conservative councils and said that they were jittery about the Bill. However, my prediction is that their fears will prove to be unfounded. If ever the Bill seemed likely to catch a significant number of Tory councils, the principles determined by the Secretary of State would be changed. It is not the Bill's purpose to achieve that.
  Words such as "profligate", "irresponsible" and "extravagant" have been bandied about. We should be given examples of what the Minister means. It would help local authorities immensely to cope with the situation that will be forced upon them if they had some guidance on the principles on which the Secretary of State regards them as profligate, irresponsible or extravagant. The same things have been said today as were said in Committee.
  We have heard about the usual easy target of some of the more bizarre grants made by local authorities under section 137 of the Local Government Act 1972. Hon. Members on both sides of the House can challenge local election procedures and so on. However, none of those things put together represent anything like a substantial sum of money. They are nothing in the context of the billions of pounds of local government expenditure.
  The Secretary of State said how pleased he was to know that some local authorities were frightened by the possible

  197
  enactment of the Bill and were looking at their expenditure to see what action they could take. If the Secretary of State is concerned and sincerely wishes to influence, other local authorities so that they, too, go down that road, the best thing that he could do would be to give the detail of some of the principles that he will use to determine rate-capping. If the principles were set out in detail, we could enable local authorities to avoid the Secretary of State's use of the general powers.
  One such principle was suggested by the Under-Secretary of State, the hon. Member for Ealing, Acton (Sir G. Young), who pondered whether local authorities should try to combat recession in their own areas. He wondered whether that was a proper use of local government resources. A local authority might face economic problems in its area that were different from those faced by another local authority. It may be a local authority such as Bradford, with problems in the textile trade, which is dominant in that area. It would be a strange bunch of locally elected representatives who did not seek to do something particular in the area to combat the difficulty. However, If the Government say that the principle should be that local authorities should not combat recession or economic problems, so be it. Local authorities should know what the principle is.
  In Committee we were often on common ground with the hon. Member for Selly Oak. We agree that there is an infinite combination of circumstances for the Secretary of State to consider when he copes with rate-capping. One cannot consider them in a simplistic way and yet do justice to local authorities. For example, will the principles be based on demography? It would be ludicrous to base too much of the case for rate-capping on demography.
  Will the principles be based on economic resources or on the potential of the local authority to raise money? That is significant, but it is not the sole factor on which the principles should be based. Will they be based on the level of environmental dereliction in the area? That differs widely across the country, so it could not be the sole basis. Will it be the level of unemployment or the state of the housing stock or other buildings in the area? We had a debate the other day about industrial buildings. The Minister for Housing and Construction was sympathetic. He accepted that there might be a need to give particular consideration to that problem. Will that be the principle which the Secretary of State will use to determine whether a local authority should be capped?
  There is a great kaleidoscope of principles with which we might have to cope. Why will the Government not publish the principles? What embarrassment would it cause them? Do the Secretary of State and the Government not want to have the embarrassment of arguing the case on principles with local authorities which might challenge them?
  Hon. Members on both sides of the House say that if the Government are to overturn the historical relationship between locally elected representatives and Members of the House, at least they should do local government the courtesy of giving it some idea of the principles on which they will base the overturning of that relationship. They should not leave it to the whim and determination of one person alone, however important he is to the Government and the country.
  Mr. Ray Powell: I am glad to be called to speak on the new clause, because it is of great significance to Welsh local authorities.
  I attended most of the Committee sittings after the sad death of Joan Evans. I was surprised that no Welsh Minister was present in Committee. If one looks at the Committee proceedings, one sees that all the references to Wales were made either by loan Evans or by myself. There was no response whatsoever from the Government Front Bench about the impact of the Bill on Wales, particularly the impact of clauses 2 and 3.
  I was interested in the observations of my hon. Friend the Member for Tyne Bridge (Mr. Cowans) on this issue and on the fact that the Bill is so inflexible. The only flexibility is for the Minister when he makes certain decisions. There is no directive for local authorities. The Minister has decided that in no way will he allow local authorities any guidelines so that they can avoid being capped.
  In Committee I referred to my local authority, the Ogwr borough authority, which spends about £9·5 million. However, because of the forecast increase in spending in the next 12 months, that amount will go well over the £10 million figure and in all probability the authority will be capped in 1985–86. The Minister said that the general power would be taken only in absolutely essential and exceptional circumstances. We want to find out what are the exceptional and absolutely essential circumstances. Despite the deep and lengthy probing of my hon. Friend the Member for Tyne Bridge and others of my hon. Friends, little response has been forthcoming from the Minister. As my hon. Friend said, it is essential to force a Division on the new clause so that the House and local authorities throughout Britain, but especially in Wales, know of our decision.
  Mr. Waldegrave: The hon. Member for Tyne Bridge (Mr. Cowans) said that in Committee I appeared to be wavering on this matter. He was right. Hon. Members on both sides of the House have put forward strong arguments on this matter. The hon. Gentleman gave us credit for the fact that nothing in other parts of the legislation, or other local government legislation, stands against the principle of consultation. On the contrary, we try, wherever reasonable, to build in consultation. We start, therefore, with a presumption in favour of the new clause. That is why we said that we would look seriously at the proposal, and we have done so.
  There are powerful arguments against the new clause. I hope to convince the hon. Member for Tyne Bridge that those arguments are matters not of principle of the type to which he referred but are more to do with practicality. I accept that, as the new clause is drafted, consultation on the principles must be near to the process of designation. I presume that is the purpose of the three-month limitation on when consultations will be undertaken. There will not, therefore, be vacuous discussion early on. That is a fair point. Consultation should be as late as possible so that real discussion can occur.
  I assure the hon. Gentleman that reconsideration of this matter has not been a matter of form. One argument, which causes difficulty, is that the closer we get to designation of the authorities, the closer we get to discussion not about general principles but about which authorities are caught by different sets of principles. At that point, we are near to discussing individual authorities.

  199
  I am not sure that it is right to involve the local associations in those discussions. Normally, they are rightly chary of becoming involved in discussions about the relationship between the Government and a particular local authority. Their job is to represent the different classes of authorities generally.
  We are on the horns of a dilemma. It might not be proper to involve the local authorities in discussions about whether a particular authority is caught, so some weight must be attached to that argument.
  In Committee the Opposition rightly pressed another, more serious argument—not to introduce delays at the end of the process. The local authorities and their officers must be involved in a dialogue with central Government as early as possible so that they know where they are. They will wish to put together their case for derogation. It is essential that there are no delays. The room for delay becomes a problem when building in a statutory consultation procedure at the end of the process, where it will be meaningful. Even with the best will in the world, we have seen in the past few months that there is room for delay of one kind or another— for example, in legal challenges about whether the Association of London Authorities is to be properly consulted. Those delays are greatly against one of the other interests of local authorities, which hon. Members have rightly pressed—that local authorities should know where they are as soon as possible.
  I assure the hon. Gentleman in an unbiased way that we start with a presumption in favour of consultation. However, I have concluded that if we accept this measure, the authorities might be worse off.
  Mr. Cowans: I do not see the dilemma. The Under-Secretary of State might not want to involve the voluntary associations, but the new clause is worded so that he can have consultations with any local authority he wishes. When will the hon. Gentleman get round to defending the view that mandatory consultations are good in part II but should not exist in part I?
  7.45 pm
  Mr. Waldegrave: That is the second leg of my argument. I take it that the hon. Gentleman wishes to involve the associations. It is essential that there should be a real dialogue with individual authorities. Such discussions will not deal greatly with principles, which, I suspect, will influence the associations. The Secretary of State outlined to the Committee the list of alternative principles. Whichever set is used, a large number of the same authorities will be involved. The authorities will want to be involved in a dialogue about the specific position in which they find themselves, and I do not wish to delay that process.
  The hon. Member for Tyne Bridge said that we must be up to no good because we have built consultation into part II but not into part I. I hope that I can reassure the hon. Gentleman that the reason why we shall have consultation under part II is consistent with the argument I have just put forward for not having consultation under part I. In part I, the discussion will be about the position of individual authorities, where they are not properly involved. In part II, because authorities generally will be involved, it will be right for the local authority associations to have consultations. For that reason, the positions differ.
  Mr. Cowans indicated dissent.
  Mr. Waldegrave: I see that I have not convinced the hon. Gentleman. I am sorry about that. The Government have come down in favour of not accepting the new clause.
  Dr. Cunningham: The Labour party is unconvinced.by the argument of the Under-Secretary of State. It is amazing that a Government who say that they adhere to the principles of local democracy will give a statutory right of consultation to industry and commerce but not to local councils, either individually or collectively. It is astonishing that the Under-Secretary of State should say that it is important that this principle is embodied in part II, which the Secretary of State said the Government do not intend to use except in extremis and hope never to use, but cannot embody the principle in part I, which the Government intend to use as soon as possible. Is it not a classic example of standing logic on its head to say, "This is important in a case where it will never be used but unimportant in a case when we know it will be used"?
  That was the most unconvincing response that we could have heard from the Under-Secretary of State on the important issue of the right of local authorities, which are to have their democratic freedom taken away by the Government under the provisions of the Bill, to be consulted.
  Mr. Cowans: It is insulting.
  Dr. Cunningham: My hon. Friend says that it is insulting to local authorities, and I agree with him. We shall press the motion to a Division.
  Question put, That the clause be read a Second time:—
  The House divided: Ayes 184, Noes 291.

  Division No. 206]

  [7.50 p.m.

  AYES

  Adams, Allen (Paisley N)

  Cook, Frank (Stockton North)

  Alton, David

  Cook, Robin F. (Livingston)

  Anderson, Donald

  Corbett, Robin

  Archer, Rt Hon Peter

  Corbyn, Jeremy

  Ashdown, Paddy

  Cowans, Harry

  Ashley, Rt Hon Jack

  Craigen, J. M.

  Atkinson, N. (Tottenham)

  Crowther, Stan

  Bagier, Gordon A. T.

  Cunliffe, Lawrence

  Banks, Tony (Newham NW)

  Cunningham, Dr John

  Barnett, Guy

  Dalyell, Tam

  Barron, Kevin

  Davies, Rt Hon Denzil (L'lli)

  Beaumont-Dark, Anthony

  Davies, Ronald (Caerphilly)

  Beckett, Mrs Margaret

  Davis, Terry (B'ham, H'ge H't)

  Beith, A. J.

  Deakins, Eric

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

  Dixon, Donald

  Bermingham, Gerald

  Dobson, Frank

  Bidwell, Sydney

  Dubs, Alfred

  Blair, Anthony

  Dunwoody, Hon Mrs G.

  Boyes, Roland

  Eadie, Alex

  Bray, Dr Jeremy

  Eastham, Ken

  Brown, Gordon (D'f'mline E)

  Edwards, Bob (W'h'mpt'n SE)

  Brown, Hugh D. (Provan)

  Ellis, Raymond

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

  Evans, John (St. Helens N)

  Brown, Ron (E'burgh, Leith)

  Ewing, Harry

  Bruce, Malcolm

  Fatchett, Derek

  Buchan, Norman

  Faulds, Andrew

  Callaghan, Jim (Heyw'd & M)

  Field, Frank (Birkenhead)

  Campbell-Savours, Dale

  Fields, T. (L'pool Broad Gn)

  Canavan, Dennis

  Fisher, Mark

  Carlile, Alexander (Montg'y)

  Flannery, Martin

  Cartwright, John

  Foot, Rt Hon Michael

  Clark, Dr David (S Shields)

  Forrester, John

  Clarke, Thomas

  Foster, Derek

  Clay, Robert

  Foulkes, George

  Cocks, Rt Hon M. (Bristol S.)

  Fraser, J. (Norwood)

  Cohen, Harry

  Garrett, W. E.

  Coleman, Donald

  George, Bruce

  Concannon, Rt Hon J. D.

  Godman, Dr Norman

  Conlan, Bernard

  Gould, Bryan

  201

  Hardy, Peter

  O'Neill, Martin

  Harman, Ms Harriet

  Park, George

  Harrison, Rt Hon Walter

  Parry, Robert

  Hart, Rt Hon Dame Judith

  Patchett, Terry

  Haynes, Frank

  Pavitt, Laurie

  Healey, Rt Hon Denis

  Pendry, Tom

  Hogg, N. (C'nauld & Kilsyth)

  Penhaligon, David

  Holland, Stuart (Vauxhall)

  Pike, Peter

  Home Robertson, John

  Powell, Raymond (Ogmore)

  Howells, Geraint

  Prescott, John

  Hoyle, Douglas

  Radice, Giles

  Hughes, Dr. Mark (Durham)

  Randall, Stuart

  Hughes, Robert (Aberdeen N)

  Redmond, M.

  Hughes, Roy (Newport East)

  Richardson, Ms Jo

  Hughes, Sean (Knowsley S)

  Roberts, Allan (Bootle)

  Hughes, Simon (Southwark)

  Robertson, George

  Janner, Hon Greville

  Robinson, G. (Coventry NW)

  Jenkins, Rt Hon Roy (Hillh'd)

  Rooker, J. W.

  John, Brynmor

  Ross, Ernest (Dundee W)

  Johnston, Russell

  Rowlands, Ted

  Jones, Barry (Alyn & Deeside)

  Ryman, John

  Kaufman, Rt Hon Gerald

  Sedgemore, Brian

  Kennedy, Charles

  Sheerman, Barry

  Kirkwood, Archibald

  Shore, Rt Hon Peter

  Lambie, David

  Short, Ms Clare (Ladywood)

  Lamond, James

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

  Lewis, Ron (Carlisle)

  Silkin, Rt Hon J.

  Lewis, Terence (Worsley)

  Skinner, Dennis

  Litherland, Robert

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

  Lloyd, Tony (Stretford)

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

  Loyden, Edward

  Soley, Clive

  McCartney, Hugh

  Spearing, Nigel

  McDonald, Dr Oonagh

  Stott, Roger

  McKelvey, William

  Strang, Gavin

  Mackenzie, Rt Hon Gregor

  Straw, Jack

  Maclennan, Robert

  Thomas, Dafydd (Merioneth)

  McNamara, Kevin

  Thomas, Dr R. (Carmarthen)

  McTaggart, Robert

  Thompson, J. (Wansbeck)

  McWilliam, John

  Thorne, Stan (Preston)

  Madden, Max

  Tinn, James

  Marek, Dr John

  Torney, Tom

  Marshall, David (Shettleston)

  Wallace, James

  Martin, Michael

  Wardell, Gareth (Gower)

  Mason, Rt Hon Roy

  Wareing, Robert

  Maxton, John

  Weetch, Ken

  Maynard, Miss Joan

  Welsh, Michael

  Meadowcroft, Michael

  White, James

  Michie, William

  Williams, Rt Hon A.

  Mikardo, Ian

  Winnick, David

  Millan, Rt Hon Bruce

  Woodall, Alec

  Miller, Dr M. S. (E Kilbride)

  Young, David (Bolton SE)

  Mitchell, Austin (G't Grimsby)

  Morris, Rt Hon J. (Aberavon)

  Tellers for the Ayes:

  Morrison, Hon C. (Devizes)

  Mr. James Hamilton and Mr. Allen McKay.

  Nellist, David

  NOES

  Adley, Robert

  Braine, Sir Bernard

  Aitken, Jonathan

  Brandon-Bravo, Martin

  Alexander, Richard

  Bright, Graham

  Alison, Rt Hon Michael

  Brinton, Tim

  Amery, Rt Hon Julian

  Brittan, Rt Hon Leon

  Ancram, Michael

  Brown, M. (Brigg & Cl'thpes)

  Arnold, Tom

  Browne, John

  Ashby, David

  Bruinvels, Peter

  Atkins, Robert (South Ribble)

  Bryan, Sir Paul

  Atkinson, David (B'm'th E)

  Buck, Sir Antony

  Baker, Nicholas (N Dorset)

  Budgen, Nick

  Baldry, Anthony

  Burt, Alistair

  Banks, Robert (Harrogate)

  Butcher, John

  Bendali, Vivian

  Butterfiil, John

  Bennett, Sir Frederic (T'bay)

  Carlisle, John (N Luton)

  Best, Keith

  Carlisle, Kenneth (Lincoln)

  Bevan, David Gilroy

  Carttiss, Michael

  Biffen, Rt Hon John

  Chalker, Mrs Lynda

  Biggs-Davison, Sir John

  Chapman, Sydney

  Bonsor, Sir Nicholas

  Chope, Christopher

  Bottomley, Peter

  Churchill, W. S.

  Bowden, Gerald (Dulwich)

  Clark, Dr Michael (Rochford)

  Boyson, Dr Rhodes

  Clark, Sir W. (Croydon S)

  202

  Clarke, Rt Hon K. (Rushcliffe)

  Howell, Rt Hon D. (G'ldford)

  Clegg, Sir Walter

  Howell, Ralph (N Norfolk)

  Cockeram, Eric

  Hubbard-Miles, Peter

  Colvin, Michael

  Hunt, David (Wirral)

  Cope, John

  Hunt, John (Ravensbourne)

  Corrie, John

  Hunter, Andrew

  Couchman, James

  Hurd, Rt Hon Douglas

  Cranborne, Viscount

  Irving, Charles

  Currie, Mrs Edwina

  Jenkin, Rt Hon Patrick

  Dickens, Geoffrey

  Johnson-Smith, Sir Geoffrey

  Dicks, Terry

  Jones, Gwilym (Cardiff N)

  Dorrell, Stephen

  Jones, Robert (W Herts)

  Douglas-Hamilton, Lord J.

  Joseph, Rt Hon Sir Keith

  Dover, Den

  Kershaw, Sir Anthony

  du Cann, Rt Hon Edward

  King, Roger (B'ham N'field)

  Dunn, Robert

  King, Rt Hon Tom

  Durant, Tony

  Knight, Gregory (Derby N)

  Eggar, Tim

  Knight, Mrs Jill (Edgbaston)

  Emery, Sir Peter

  Knowles, Michael

  Evennett, David

  Lamont, Norman

  Eyre, Sir Reginald

  Lang, Ian

  Fallon, Michael

  Latham, Michael

  Farr, John

  Lawler, Geoffrey

  Favell, Anthony

  Lawrence, Ivan

  Fenner, Mrs Peggy

  Lawson, Rt Hon Nigel

  Finsberg, Sir Geoffrey

  Leigh, Edward (Gainsbor'gh)

  Fletcher, Alexander

  Lennox-Boyd, Hon Mark

  Fookes, Miss Janet

  Lester, Jim

  Forman, Nigel

  Lilley, Peter

  Forsyth, Michael (Stirling)

  Lloyd, Ian (Havant)

  Fowler, Rt Hon Norman

  Lloyd, Peter, (Fareham)

  Fox, Marcus

  Lyell, Nicholas

  Fraser, Peter (Angus East)

  McCrindle, Robert

  Freeman, Roger

  McCurley, Mrs Anna

  Fry, Peter

  Macfarlane, Neil

  Gale, Roger

  MacKay, Andrew (Berkshire)

  Galley, Roy

  MacKay, John (Argyll & Bute)

  Gardiner, George (Reigate)

  Maclean, David John.

  Gardner, Sir Edward (Fylde)

  McQuarrie, Albert

  Garel-Jones, Tristan

  Major, John

  Gilmour, Rt Hon Sir Ian

  Malins, Humfrey

  Glyn, Dr Alan

  Malone, Gerald

  Goodlad, Alastair

  Marland, Paul

  Gorst, John

  Marlow, Antony

  Gow, Ian

  Maude, Hon Francis

  Gower, Sir Raymond

  Mawhinney, Dr Brian

  Grant, Sir Anthony

  Maxwell-Hyslop, Robin

  Greenway, Harry

  Mayhew, Sir Patrick

  Gregory, Conal

  Mellor, David

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

  Merchant, Piers

  Griffiths, Peter (Portsm'th N)

  Miller, Hal (B'grove)

  Grist, Ian

  Mills, Iain (Meriden)

  Ground, Patrick

  Mills, Sir Peter (West Devon)

  Grylis, Michael

  Miscampbell, Norman

  Gummer, John Selwyn

  Moate, Roger

  Hamilton, Neil (Tatton)

  Monro, Sir Hector

  Hampson, Dr Keith

  Montgomery, Fergus

  Hanley, Jeremy

  Morrison, Hon P. (Chester)

  Hannam,John

  Mudd, David

  Harvey, Robert

  Murphy, Christopher

  Haselhurst, Alan

  Neale, Gerrard

  Havers, Rt Hon Sir Michael

  Nelson, Anthony

  Hawkins, Sir Paul (SW N'folk)

  Neubert, Michael

  Hawksley, Warren

  Newton, Tony

  Hayhoe, Barney

  Nicholls, Patrick

  Hayward, Robert

  Norris, Steven

  Heathcoat-Amory, David

  Onslow, Cranley

  Heddle, John

  Oppenheim, Philip

  Henderson, Barry

  Oppenheim, Rt Hon Mrs S.

  Hickmet, Richard

  Osborn, Sir John

  Higgins, Rt Hon Terence L.

  Ottaway, Richard

  Hill, James

  Page, John (Harrow W)

  Hind, Kenneth

  Page, Richard (Herts SW)

  Hirst, Michael

  Parris, Matthew

  Holland, Sir Philip (Gedling)

  Patten, John (Oxford)

  Holt, Richard

  Pattie, Geoffrey

  Hooson, Tom

  Pawsey, James

  Hordern, Peter

  Peacock, Mrs Elizabeth

  Howard, Michael

  Pink, R. Bonner

  Howarth, Gerald (Cannock)

  Pollock, Alexander

  203

  Porter, Barry

  Tapsell, Peter

  Powell, William (Corby)

  Taylor, Teddy (S'end E)

  Powley, John

  Temple-Morris, Peter

  Price, Sir David

  Terlezki, Stefan

  Proctor, K. Harvey

  Thatcher, Rt Hon Mrs M.

  Rathbone, Tim

  Thomas, Rt Hon Peter

  Rees, Rt Hon Peter (Dover)

  Thompson, Donald (Calder V)

  Renton, Tim

  Thompson, Patrick (N'ich N)

  Rhodes James, Robert

  Thornton, Malcolm

  Ridley, Rt Hon Nicholas

  Thurnham, Peter

  Ridsdale, Sir Julian

  Townend, John (Bridlington)

  Roberts, Wyn (Conwy)

  Townsend, Cyril D. (B'heath)

  Robinson, Mark (N'port W)

  Tracey, Richard

  Roe, Mrs Marion

  Trotter, Neville

  Rossi, Sir Hugh

  van Straubenzee, Sir W.

  Rost, Peter

  Vaughan, Sir Gerard

  Rumbold, Mrs Angela

  Waddington, David

  Ryder, Richard

  Wakeham, Rt Hon John

  Sackville, Hon Thomas

  Waldegrave, Hon William

  Sainsbury, Hon Timothy

  Walker, Bill (T'side N)

  St. John-Stevas, Rt Hon N.

  Waller, Gary

  Sayeed, Jonathan

  Walters, Dennis

  Shaw, Sir Michael (Scarb')

  Ward, John

  Shelton, William (Streatham)

  Wardle, C. (Bexhill)

  Shepherd, Colin (Hereford)

  Warren, Kenneth

  Shepherd, Richard (Aldhdge)

  Watson, John

  Silvester, Fred

  Watts, John

  Sims, Roger

  Wells, Bowen (Hertford)

  Skeet, T. H. H.

  Wells, John (Maidstone)

  Smith, Sir Dudley (Warwick)

  Wheeler, John

  Smith, Tim (Beaconsfield)

  Whitfield, John

  Soames, Hon Nicholas

  Whitney, Raymond

  Spencer, Derek

  Wilkinson, John

  Spicer, Michael (S Worcs)

  Winterton, Mrs Ann

  Stanbrook, Ivor

  Winterton, Nicholas

  Steen, Anthony

  Wolfson, Mark

  Stern, Michael

  Wood, Timothy

  Stevens, Lewis (Nuneaton)

  Woodcock, Michael

  Stevens, Martin (Fulham)

  Young, Sir George (Acton)

  Stewart, Allan (Eastwood)

  Younger, Rt Hon George

  Stewart, Andrew (Sherwood)

  Stewart, Ian (N Hertf'dshire)

  Tellers for the Noes:

  Stokes, John

  Mr. Carol Mather and Mr. Robert Boscawen.

  Stradling Thomas, J.

  Sumberg, David

  Question accordingly negatived.

Clause 1

  POWER TO PRESCRIBE MAXIMUM RATES AND PRECEPTS
  Mr. Charles Morrison: I beg to move amendment No. 25, in page 1, line 12, at end insert—
  '(lA) For the purpose of this part of this Act, the Secretary of State shall not designate more than twenty authorities in any financial year.'
  I did not speak on Second Reading, much as I should have liked to do so, because I was not fortunate enough to catch the eye of the Chair. Nor did I serve on the Committee and, therefore, this is the first occasion on which I shall make a speech about the Bill.
  By way of introduction to the amendment I shall make my attitude to the Bill entirely clear: I am totally opposed to it. It centralises power. That is normally contrary to Tory philosophy, which believes in the diffusion of power. By centralising power, the Bill undermines the balance between central Government and local government, which, let it not be forgotten, has stood the Tory party in good stead, especially when it has been in opposition and has had to rely on Tory-controlled local authorities to stand out against the excesses of Socialism.
  The Bill infers that the man in Whitehall knows best. That has never been a Tory principle and is damaging to
  204
  local democracy. The Bill gives almost unlimited power to the Secretary of State over all local authorities and, conversely, whenever those powers are exercised, central Government will take the blame for inadequate services. Thus, the electoral consequences are obvious.
  If, on the other hand, the Government do not use their powers under the Bill, should it be enacted, they will be blamed for the rate demand, be it high or low, responsible or irresponsible. None of us should forget that there is not much selectivity by those who complain about rates; many are simply against them. That being so, many will be totally disappointed by the Bill.
  Unless the general powers are used—my right hon. Friend the Secretary of State said that that was unlikely —most rate powers will remain totally unaffected by the Bill. Therefore, the Bill raises political expectations which it will never achieve. That is dangerous, and the scope for a political backlash is considerable.
  Be that as it may, the House gave the Bill a Second Reading, and we are now trying to improve it. Part I provides for the selective limitation of rates. The Bill should live up to its intentions more precisely; hence my amendment. The amendment states that no more than 20 local authorities should be designated in any one year. On Second Reading the Secretary of State said that he would designate between 12 and 20 local authorities in any one year. Thus, the amendment specifies his upper limit and incorporates the Government's stated intention.
  In addition, it is worth remembering that the Secretary of State said that 75 per cent. of the overspend in 1983–84 could be laid at the door of 16 extravagant local authorities. He may say that the amendment is unnecessary as he will not go above 20 local authorities, and that is doubtless his intention, but his successors may feel less inhibited by his verbal undertaking.
  Furthermore, in the past powers have tended to be used way beyond what was originally envisaged — for example, the experience following the introduction of targets. With regard to targets the 1980–81 rate support grant order records:
  "It is intended that the power should be exercised—if at all —in such a way as to affect only a very small minority of authorities."
  By 1983–84 more than 160 authorities suffered grant penalties for exceeding their targets. The number may be even higher in 1984–85. It is important that the selective provisions in the Bill are clearly limited and visibly written into the Bill if the escalation seen in the past is not to be repeated.
  Amendment No. 25 is a paving amendment and precedes amendment No. 31, which we shall reach tomorrow afternoon. It aims to remove the powers of general limitations of rates. Whatever hon. Members may think in support of the selective powers—I appreciate that a number of my right hon. and hon. Friends have sympathy for them—many hon. Members are opposed to the general powers. If the general power clauses, clauses 9 to 12, were removed from the Bill, nothing would prevent clause 1 from being applied as though it provided a general power. It is called selective, but in practice it could be, used generally. Thus, clause 1 must be limited in its scope. That is what amendment No. 25 seeks to do.
  Mr. Straw: I support the amendment. As the hon. Member for Devizes (Mr. Morrison) so eloquently explained, for all hon. Members concerned about the

  205
  general powers it is an important probing amendment to discover the Government's real intentions with regard to the specific powers.
  As the Bill is drafted, it would be open to the Secretary of State to use the selective powers to rate-cap almost every authority which exceeds the £10 million floor of grant-related expenditure. If he wanted a fig-leaf of selectivity, he could use various formulae to ensure that 10 authorities or so escape. None the less, under part I a selective scheme could lawfully rate-cap all the metropolitan district authorities, most of the London boroughs and most of the shire counties, including a large number of Conservative-controlled shire counties and metropolitan boroughs, as well as a few shire districts, leaving only the smaller shire districts excluded by clause 2(2)(a) and certain authorities, probably all Conservative-controlled, with expenditure so low that even the capricious and accidental effects of the Government's proposals would be unlikely to catch them. Experience shows, however, that a number of the 160 authorities to which the hon. Member for Devizes referred have been low spenders on any basis. Indeed, that is the basis of their complaints.
  The amendment is unusual in that a similar proposal was the subject of extensive discussion in Committee. We are grateful to the Chair for recognising that its importance is such that it should be reconsidered on the Floor of the House. An extensive debate took place on 21 February on an amendment couched in similar terms. We sought to pin the Secretary of State down on two related questions. First, putting it crudely, was he prepared to put his signature where his mouth was and commit himself in law in a binding fashion to the undertakings that he gave to the House that he intended that only between 12 and 20 authorities should be subject to rate capping?
  That is important, not because we do not believe the Secretary of State, or indeed any Minister speaking from the Dispatch Box—the right hon. Gentleman is a man of honour and we have come to recognise his many qualities in Committee—but because he is Secretary of State only for the time being. Even if the Government continue for their full term, it is highly unlikely that he will be Secretary of State for the Environment in 1987 or 1988. There are undoubtedly higher things in store for him. Given the cock-up that will occur when this measure comes into operation, I advise him to get out from under in double quick time and to find a nice safe haven, having served his term at the coal face as he surely has during the past year.
  Previous Secretaries of State have made worthy and well-intentioned commitments which have then been stood on their heads by the subsequent actions of other Ministers. Conservative Members should weigh carefully the words of the present Secretary of State for Employment, formerly the Minister for Local Government and Environmental Services, the right hon. Member for Bridgwater (Mr. King) in March and April 1980 when he recommended the system of grant-related expenditure assessments. Referring to the needs assessment, he said:
  "It is not suggested that it prescribes a specific level to which an authority ought to spend." — [Official Report, Standing Committee D, 1 April 1980; c. 941.]
  On 27 March 1980 the right hon. Gentleman used the words which are now becoming notorious but which bear
  206
  repeating because it is important that political parties as well as individual politicians should be consistent. He said:
  "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. I have tried to make clear that that is a matter for local authorities…We have specifically rejected that approach. We have said that our concern is the distribution of public money."
  That is an interesting use of the phrase "public money", as it clearly refers not to the totality of locally raised expenditure and central Government expenditure, but solely to the latter.
  The right hon. Gentleman continued:
  "Beyond that I am powerless to do anything about fixing the level of rates. I have made certain comments on my view, as I did in the House yesterday. Local authorities are autonomous. They fix their rate systems. I can comment and urge the need for economy. I have some influence over the distribution of public funds"—
  the term is again used to denote central Government expenditure only—
  "but 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.]
  Mr. Beaumont-Dark: A very good speech.
  Mr. Straw: Yes, it was, and if the Government had been consistent in that approach they would not be in the present mess and they would not be open to the charge from Conservative Members, to whom I must defer in this respect, of producing a Bill that is contrary to the principles of Toryism and takes the Government and the country down an alien, authoritarian road which the Government and their party will come greatly to regret.
  8.15 pm
  Those statements by the former Minister have been turned on their head because the GREA has become a specific level to which an authority ought to spend. Even worse, although the Under-Secretary of State, the hon. Member for Bristol, West (Mr. Waldegrave), claimed on Second Reading that GREAs would be just one of the criteria used by the Secretary of State to determine the rate-capping principles, the Secretary of State himself said subsequently in Committee that it was "the central criterion". Solemn undertakings given to the House by one Minister have been turned on their heads by another Minister in the same Government of the same party who simply happens to have a different body.
  Mr. Beaumont-Dark: Or a different brief.
  Mr. Straw: Or a different edict or instruction. In a revealing slip of the tongue, if such it was, at Prime Minister's Question Time today the Prime Minister said that the Foreign Secretary had been "instructed" by her—not, I suspect, for the first time or indeed for the last time—to get a certain deal and that if he failed to do so——
  Mr. Tony Banks: Off with his head!
  Mr. Straw: Yes, and it will no doubt happen at one of those 3 am meetings at No. 10. We are told that the prime Minister and the Foreign Secretary do not sleep before 4 am.
  Mr. Banks: And preferably not together.
  Mr. Straw: I am sure that they do not sleep together. [HON. MEMBERS Order!"] The suggestion came from the Conservative side. [HON. MEMBERS No."]
  Mr. Banks: I threw my voice.
  Mr. Straw: I apologise. I am totally deaf in one ear, so I sometimes get the direction of comments wrong—[Interruption.] If the Secretary of State wishes to pursue a private argument with my hon. Friend the Member for Newham, North-West (Mr. Banks) I shall not interfere.
  As the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) said, probably as a result of an instruction or a change in the brief, solemn commitments given to the House in 1980 have been turned on their heads. Had the then Minister said in 1980 that GREAs were not just a method of distributing the rate support grant but were to be used in the future as a benchmark to determine the overall expenditure level for every authority, the mood of the House at that time would have been to reject the Bill as utterly unacceptable. That is the importance of the commitment given by the then Minister.
  In Committee the Secretary of State said:
  "I am happy to reiterate that we aim at a figure of between 12 and 20 authorities for capping. That is an order of magnitude figure. It would be foolish in the extreme to accept an amendment which precluded us from adopting perfectly sensible, straightforward and coherent principles if we needed to cap 21 or 22 authorities."—[Official Report, Standing Committee G, 21 February 1984; c. 575.]
  That is understandable, but there has to be a limit somewhere, otherwise we end up by turning the selective scheme into a general scheme. This is the amendment of the hon. Member for Devizes and I hope that I am not putting words into his mouth if I say that he might find it acceptable if the Secretary of State said, not 20, but 25, because that is an order of magnitude, and then the Secretary of State has some leeway.
  Mr. John Fraser: That would include Lambeth.
  Mr. Straw: I am a ratepayer in Lambeth and I happily pay my rates. I know that a growing number of Conservative Members pay their rates in Lambeth. The number moving into that fine borough increases every day.
  Mr. Powley: Will the hon. Gentleman accept that there are some people who have recently moved into Lambeth, as I have, who deplore the level of rates that we have to pay?
  Mr. Straw: The hon. Gentleman must live in a very large house indeed. This is not the time to ask why he does not live in Lord North street, or elsewhere in Westminster, but I suspect that the level of rates may have something to do with it.
  That is the first point, and it is a question of orders of magnitude. If this is a selective scheme, and if the Secretary of State is to be true to his word that it should be limited to between 12 and 20, let us call it 25, or 24, then we will know that this is a selective scheme. However much we may object to it, its purpose will be clear.
  The second question which arises, and which we also debated at some length in Committee, is, as it were, the joker and the twist in the Secretary of State's argument. If this scheme is to be limited to 20 authorities, what are the savings to be? I repeat, because it is a central point and is worth repeating, that, try as we did in Committee to discover from the Secretary of State how he expected to
  208
  make the savings he was being told by the Treasury to make within the context of a selective scheme, we were unable to arrive at an agreement on the figures.
  The Secretary of State told us that the gross savings that he would be looking for under a selective scheme would be about £300 million. That may be the case, but that is gross and it is way below the figure which the Chancellor of the Exchequer is looking for by way of savings. I find it impossible to imagine that the Secretary of State would be able to achieve the rest of the savings simply by further manipulating the rate support grant proportion downwards and making the target ever harsher. If he does that, he and his hon. Friend the Member for Bristol, West will have to renege on another promise made in connection with the rate support grant —the categorical assurance that the shire counties, which have been so badly done by this year, would be helped next year. It is simply not possible to square these circles. To use another analogy, if we push one end, something else pops out of the other.
  The figure of £300 million is a gross saving. By the time we have taken account, first, of the short-term loss of tax —since that amount will in the main be spent on wages and salaries of local government employees and if they are made redundant or there is natural wastage there will be less throw-back by way of income tax and indirect taxes to the Treasury—and, secondly, of the fact that if the Government succeed in cutting down the expenditure of individual authorities their entitlement to rate support grant will go up, the £300 million will certainly be down to £200 million, and maybe even less.
  We had an example of this last Tuesday during the debate on the second supplementary report on the rate support grant for 1983–84, when we discussed the Government's failure to bring forward the report for 1982–83. As a result of the Greater London council spending less by £150 million than it anticipated, it is to receive a very substantial increase in its rate support grant. Furthermore, a large number of both Labour and Conservative authorities, including Labour Lancashire and, no doubt, Conservative Wiltshire, are to lose part of their rate support grant. Nothing illustrates better the way in which these mechanisms will operate. In that way and in other ways the Secretary of State's gross figure will be reduced to a net figure of not much more than £200 million, and probably a good deal less.
  This will be even more inevitable if the Secretary of State remains true to the undertaking that he gave to the Committee and does not start with a bottom-line figure This, as I explained in the debate earlier today, follows what he said in Committee at column 591—that there is no question of criteria being chosen in relation to a predetermined requirement for savings. I do riot understand how the Secretary of State came to make that statement. given that time and again he and his colleague, the Under-Secretary, say that the whole purpose of the Bill is to secure public expenditure savings.
  I wonder, too, what the Treasury thinks about it, because I am sure that the Treasury already has a very clear pre-determined idea of the amount that it expects the Secretary of State to save, and it will be handing him a chitty with the amount, which I dare say will say not £200 million, but about £1,500 million, and he will be required to produce it, unless the balance of forces within the Cabinet is not what we have been led to believe and the Secretary of State, not the Prime Minister and the

  209
  Chancellor, really has all the votes. If that is true, I take my hat off to the Secretary of State, but what is the purpose of the Bill, except as a charade?
  Mr. Tony Banks: Will my hon. Friend accept that, of this often-quoted £177 million variance in the GLC's budgeting for 1982–83, about two thirds comes from higher-than-expected receipts both from income which the council derives and from Government grants?
  Mr. Straw: I would, of course, accept that, and I think it is also important to point out that the decision of the Greater London council to budget at a level higher than its expenditure was the result not of irresponsibility, as the Secretary of State would claim, but of the GLC's being unable to anticipate the outturn because of all kinds of uncertainties—most of which have been placed in their way by the Government — the anticipation of higher interest rates, the level of fare subsidies, and so on. It was not anticipated that fare subsidies would produce such a high economic return as they did. The GLC would have been criticised even more if it had budgeted for less than it eventually spent.
  This is a crucial amendment which tests the good faith not of the Secretary of State—we do not challenge that —but of the Government and their readiness to back what they say with legislation. It is a principle of the rule of law that what the Secretary of State says in the House cannot be tested in the courts and cannot even be adduced in evidence. Since the Secretary of State claims to subscribe so faithfully to the rule of law, we want his notions, his principles, to be translated into law. If this is a selective scheme, let it be a selective scheme. We give our support to the amendment.
  Mr. Powley: I wish to urge my right hon. Friend the Minister to reject this amendment, for reasons which I hope to put forward in the next few moments, but also for many more reasons of which I am sure he will think.
  With respect, I say to my hon. Friend the Member for Devizes (Mr. Morrison), who moved the amendment, that I suspect that I might have agreed with it if it had been moved in similar circumstances some 20 years ago, when the situation in local government was rather different from what it is today. It is because of those different circumstances that I oppose the amendment.
  I have had experience of working through three decades of local government during the 1960s, 1970s and 1980s. A great many Labour local authority members come from a different breed now. I know that looking back is easy and that past events look better when viewed in retrospect, but I am taking that into account. During the 1960s and 1970s, Conservative members of local councils had a great deal of respect for some of the distinguished Labour members with whom we had the honour to serve. We had political differences, but those Labour members approached local government with a different attitude from that now taken. Many Labour members on the council on which I served actually had the guts to tell those who wanted to spend more and more—their own supporters—that they could not afford to do that. They said that the rate level should be kept in moderation, and they earned a great deal of respect for that attitude.
  Mr. Nicholas Brown: I strongly agree with the hon. Gentleman's remarks about
  210
  the great deal of respect for Labour members of local authorities. But his argument about the new breed of Labour councillors is hardly an argument against their election. If they are the choice of the electors, surely that is what matters.
  Mr. Powley: Had the hon. Gentleman allowed me to continue with my speech, his intervention would not have been necessary. I hope that he will appreciate the answer——
  Mr. Piers Merchant: I hope that when my hon. Friend answers the hon. Member for Newcastle upon Tyne, East (Mr. Brown) he will remember that the Labour group on the Newcastle city council has recently expelled four of its members.
  Mr. Powley: Indeed, my hon. Friend's comments form part of the argument, and I am grateful to him.
  Labour members in the 1960s and 1970s told their supporters that they could not have certain things, even though it was not pleasant to do so. But since reorganisation in 1974, those elder statesmen have been replaced by a different type of councillor. I concede that they have been elected, but conditions have changed. They appear to have the idea that they were elected only to spend as much money as possible. Committee chairmen vie with each other——
  Mr. Jack Thompson: The hon. Gentleman is falling into the trap of talking only about authorities in his area. My county is currently Labour-controlled, but 15 years ago it was Conservative-controlled. The difference between the two groups is minimal. The council consists of responsible councillors of all political shades—including a Liberal influence. That council certainly does not bear out the remarks of the hon. Gentleman and his hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Merchant).
  Mr. Powley: The hon. Gentleman is entitled to his opinion, and I am sure that he respects our opinions as people who have served in local government.
  There is a new breed of Labour councillors, and a substantial number of them are prepared to defy the Government. It appears to be the usual practice that when there is a Labour Government there is an upsurge in Conservative councillors, and vice versa. The previous Labour Government got the country into severe financial difficulties. The Conservative-controlled councils —some of them were Conservative-controlled for the first time in many years—realised the general decline in the country's economic position, and their management reflected that. When the Labour Government said that there had to be economies and cuts in housing, education and the National Health Service, Conservative councils generally went along with that. They accepted their responsibility, tried to contain their expenditure—many of my hon. Friends were leaders of local councils at that time—and actually reduced the rate levels. I am talking about a real reduction that did not take inflation into account. Certainly in Cambridgeshire we managed to achieve a reduction in the rate level from 14p to 13p and then to 12p—despite 20 per cent. inflation. We found it possible to make those economies.
  Mr. Cormack: I appreciate my hon. Friend's comments, but they are not entirely relevant to the Bill.

  211
  One of the most vehement critics of the Bill is our right hon. Friend the Member for Cambridgeshire, South-East (Mr. Pym).
  Mr. Powley: Our right hon. Friend is entitled to his view.
  Where we once had a Labour Government but a majority of Conservative-controlled councils, we now have a Conservative Government with a significant number of Labour-controlled councils. Britain still has economic problems and needs to be put on a sound economic footing. But the Labour-controlled councils are prepared to defy the Government and fly in the face of economic reality. They will not take any notice of Britain's economic problems, which we inherited from the Labour Government, or the Conservative Government's remedies for them.
  Mr. Nicholas Brown: The Bill goes well beyond the expenditure argument. The hon. Gentleman referred to Labour councillors who were prepared to defy the Government. I remind him that many members of the Conservative party—many of them in the House—are prepared to defy the Government on this Bill.
  Mr. Powley: A vote in the House tonight or tomorrow is entirely different from defying the law of the land when a Bill has become law. I am sure that the hon. Gentleman accepts that. We have this new breed, and those people are prepared to defy the Government's exhortations. During the past four years, the Government have tried by persuasion to get local authorities to accept the realities of life, to cut their expenditure and to make economies. It is clear that a substantial number of Labour-controlled local authorities would deliberately gang up on the Government. With an amendment to restrict the number of local authorities to 20—the Secretary of State issued a list of 33 for this financial year — a substantial number of other local authorities would blatantly ignore the financial realities of life and go on spending without any regard for the cost of what they do. Liverpool is a prime example, but there are many others. If there were a limitation of 20, a substantial number would follow those 20 and exercise no restrictions.
  I hand it to Labour-controlled local authorities that they know how to get together. I wish the Conservatives did as well. The Conservative group on the Norwich city council and the Norfolk county council support the Rates Bill. My two local authorities have seen the wisdom of what the Government are doing, and I am pleased to have their support.
  The point is that Labour-controlled authorities get together. It is no coincidence that we have umpteen nuclear-free zones. I am sure that the instruction went out from Walworth road saying, "You are all to become nuclear-free zones", and they all passed resolutions to become nuclear-free zones. It was well organised.
  Mr. Nicholas Brown rose——
  Mr. Powley: No, I have given way on a number of occasions, and I really must get on.
  Those authorities had their instructions. I imagine that a number of Labour local authorities passed resolutions deploring the cuts in the National Health Service. Certainly I received a resolution from Norwich city council to that effect, and I am sure that a number of other
  212
  Labour local authorities passed the same resolution, probably word for word. They are well organised. I have no doubt that if there were a limitation of 20 authorities to be rate capped, their organisation, to which I again pay credit, would so engineer the situation that umpteen other Labour-controlled local authorities would exceed their expenditure, and the Government would then be in a far worse position.
  I hope that the Bill will bring home to local authorities the fact that they have to accept financial responsibilities. It has been demonstrated that some local authorities have accepted their responsibilities and can work within the financial guidelines. If so, the necessity for this legislation disappears out of the window. We shall not have 20 local authorities to which it will apply; we shall have none at all. The country will be in a far better position if the Bill achieves that result in local government.
  Mr. Tony Banks: I am grateful to the hon. Member for Norwich, South, (Mr. Powley) for explaining the reasoning of an important section of his party. Perhaps he would classify me as one of the new breed of councillors. I am a member of the Greater London council, and I should point out to him, in case he is classifying me as one of the new breed, that I have served continuously on a local authority for the past 14 years. I do not know whether that fits his interpretation of "new", but I am perhaps not as new in local government as he might suggest.
  8.45 pm
  The hon. Gentleman spelt out something that his right hon. Friend the Member for Chingford (Mr. Tebbit) also spelt out clearly in a speech that he made at Caxton hall the other evening. It went on to the broader issue of the restructuring of local government. Perhaps I may quote what the right hon. Gentleman said:
  "the Labour Party is the Party of division. In its present form it represents a threat to the democratic values and institutions on which our parliamentary system is based. The Greater London Council is typical of this new modern, divisive version of socialism. It must be defeated. So we shall abolish the Greater London Council."
  That is what the right hon. Member for Chingford said, and I have no reason to disbelieve him. The GLC is being abolished because it is controlled by a party with which Conservative Members fundamentally disagree. The hon. Member for Norwich, South says that because certain people, of whom he does not approve, have been elected —I remind him that, new breed or not, they were all elected through the ballot box—and he does not agree with them, therefore this draconian measure is being introduced. It is a baby-out-with-the-bathwater form of legislation, and it is clearly unacceptable to both sides of the House in important respects.
  Mr. Chope: Why was it, when the new GLC was elected, that one of the first things it did was to reduce the proportion of Conservatives on the committees to well below the pro-rata representation of a minority party, which had existed before the Left-wing Labour GLC took over? Was not that an example of the new Socialist so-called democracy in practice?
  Mr. Banks: That was hardly a question. It was more a statement of the hon. Gentleman's bigotry. It is normal practice for any administration to wish to secure its own business, and it will take steps to ensure that its business is properly administered and carried out. So what the Labour GLC did was nothing out of the ordinary, bearing

  213
  in mind the fact that it has been done by Conservative and Labour administrations for many years. There was nothing extraordinary about that.
  The hon. Member for Norwich, South went on to say that not only were these local authorities controlled by this new breed, but that they were daring to defy the Government. One reason why our democracy, despite the attacks made on it, manages to hold up reasonably well is that there are checks and balances between local government and central Government. The hon. Gentleman came out with the psephological fact that there is an inverse correlation between the party that is elected at a local election and the party of the Government in power. That has always been so, and long may it remain so. At local elections, people tend to see the Government of the day and vote the opposite way. One has only to look at recent elections to see that that inverse correlation holds true. So I do not see why local authorities should obey the wishes of central Government, because as soon as that happens—it will happen now, as a result of this Bill—there will be a form of centralisation that is bad for democracy and, in my view, bad for local government.
  I am glad that the amendment has a certain amount of cross-Chamber support. There has always been conflict between central and local government and, as I said earlier, that is a mainstay of the democratic process. I am sure that the hon. Member for Norwich, South would approve of Herbert Morrison, that well known former Labour Member who took a very muscular approach towards central government.
  There would have been no Festival of Britain, which everyone acclaims, if it had not been for Morrison deciding to defy the Government of the day. There would have been no new Waterloo bridge if it had not been for him. I am sure that the hon. Member for Norwich, South would regard Herbert Morrison as the archetypal Labour Member. In fact, if the hon. Member had been around at the time, Herbert Morrison would have been denounced by him as someone who spat in the face of Government.
  Mr. Beaumont-Dark: Herbert Morrison was, at the time of which the hon. Gentleman is speaking, Home Secretary in the then Labour Government and was certainly not leading the then LCC. Is he suggesting that, whenever somebody leaves local government, that person is still in local government? What is the logic of his argument?
  Mr. Banks: As the hon. Member for Norwich, South had been keen to speak of former Labour local government people, I was demonstrating that there had always been conflict between central and local government, and certainly that was the case between the old LCC and central Government. Herbert Morrison was able to straddle both places with the aplomb that few hon. Members could reveal today.
  If the Secretary of State wants us to take him at his word, he should accept the amendment. We have had experience in Committee and elsewhere of Secretaries of State saying, "Take my word that these powers will never be used." Bad legislation is based on the good intent of the Secretary of State of the day. The GLC—returning to that favourite creature of us all—ran foul of the Law Lords over the interpretation of the Transport (London) Act 1969. A reading of Hansard at the time of the passage
  214
  of that measure would have made it clear that the then Minister of Transport believed that the GLC had the powers that the Law Lords said it did not have. However, as we know, the Law Lords are not allowed to read Hansard in reaching a conclusion, and rightly so, I suppose.
  One can see the basic weakness in having the views and opinions of a Secretary of State subsumed in a piece of legislation. When that Secretary of State passes on to the great parliament in the sky or to another place, there is no one to read into the legislation what he thought when the legislation was going through.
  Therefore, all the assurances of the present Secretary of State, genuine and sincere though no doubt they are, are not worth the air that he uses to voice them nor the paper on which they are written. The right hon. Gentleman must convince us, and if the Bill will not affect more than 12 to 20 councils that should be written into the Bill. I doubt whether the right hon. Gentleman will accede to that cross-Chamber request because, returning to the question of the continual conflict between local and central Government, whichever party has been in control at the centre, it has always tried to curtail the powers of local government, and that goes as much for Labour as for Conservative Administrations. The Secretary of State is doing what Many Ministers in his position have wanted to do, which is strictly to curb the powers of local government, and the right hon. Gentleman has been able to use the advantage of what he regards as one or two high-spending local authorities to curb all local authorities.
  The right hon. Gentleman would be seen in a better
  light if he specified the local authorities he wishes to curb. Let him name, for example, the GLC, the ILEA, Islington council and a few others. I appreciate that it would be unusual to write their names into legislation, but at least the right hon. Gentleman should specify the numbers that he has in mind, because it should not be all local authorities.
  The right hon. Gentleman is sheltering behind what he sees as the high-spending record of the GLC and the ILEA to do what many Secretaries of State before him have only dreamt of doing, and that is to curb local government and to bring in a degree of centralisation which is anathema to democracy in Britain.
  Mr. Rippon: It is a sad fact of life that it is much easier to support a Government Bill and go through the Lobby if one does not know what Bill one is supporting. It is even easier if one has not listened to the arguments.
  Further to the remarks of my successor and hon. Friend the Member for Norwich, South (Mr. Powley), it may be that there is a new breed of Socialists. Perhaps there is a new breed of Conservatives also. In the days of Alderman Sir Arthur South, Norwich had a moderate and reasonable Socialist council. It had excellent relations with the Conservatives and it shared the various chairmanships, including that of lord mayor from time to time. It was all most amicable.
  It may be a little easier for a Conservative Member of Parliament to be elected there now. At any rate, there were not enough — boundary changes have made some difference — Conservative supporters in my time to secure my continuance as the hon. Member for Norwich, South, which I would have liked to have done. However, I am glad that my hon. Friend who now represents that

  215
  constituency is here. It may be that the electors of that constituency voted for him because they did not much like the new breed of Socialists.
  These are the sorts of decision that must be taken by local people. We cannot say, "The people we like shall be free but the people we do not like shall not be free." We cannot pick and choose freedoms. Local people must have the opportunity to make up their own minds.
  One can think of what happened in the 19th century at the time of local government reform. Professor Maitland said, in effect, "These new local authorities must be free, free if necessary to make mistakes on quite a big scale. In any event, they will normally be less serious than the mistakes which Governments make from time to time."
  It is nice to hear someone speak in favour of the Government. My hon. Friend spoke sincerely and well, but he must understand that nobody is saying that the Government should be defied. We do not have a system under which local authorities can do what they like unless it is expressly forbidden but a system under which local authorities can act only if they have the statutory power, and frequently a statutory duty goes with that statutory power. If a local authority abused its powers and defied the Government in the sense that it defied the statutes that the House has passed, most of us would have no sympathy with it. However, we have said time and again—I have said it as a Minister and as a Conservative Opposition spokeman on local government affairs — that local authorities are not bound by exhortation or circulars that do not have the force of law.
  Mr. Benyon: Will my right hon. and learned Friend make it clear that those of us who have grave reservations about the Bill are in no way condoning local councils breaking the law?
  9 pm
  Mr. Rippon: I entirely agree with my hon. Friend. I see no difficulty in supporting the principle of rate capping provided that the criteria are clear, we know what we are doing and we do not give unfettered discretion to the Secretary of State to pick and choose.
  It is possible to make out a case for selective rate capping. The Government have been extremely careful to make it clear from the quotations which have been given from the White Paper and the Secretary of State's speeches that they have in mind only a selective scheme that is intended to apply only to a small number of local authorities. The Secretary of State said in Committee that that number would be 12 to 20. It is a little premature for my hon. Friend to assume that the Secretary of State will not welcome an amendment such as this. I see no reason why he should not welcome it. I said 12 or 20, but it might be wise to go to 25.
  I see no reason why, if further powers are needed, the Secretary of State should not introduce fresh legislation. This is a rather draconian power. It means that when the Secretary of State rate caps a local authority he is going close to putting in commissioners. He has got to the point at which he will have to bear responsibility for any failure of the services that a local authority might have provided. If, for example, there were pollution of a river and the local authority had to go to court to face an injunction, its defence would be, "We cannot help it. It is the Secretary of State who has prevented us from carrying out our statutory duty." When the Secretary of State rate caps an
  216
  authority, he puts himself into the local authority's shoes and supersedes the decisions of a duly elected local authority.
  Mr. Cormack: Does my right hon. and learned Friend agree that some of the most unpleasant events on picket lines illustrate how necessary it is for local authorities to have flexibility in the amount of money that they spend on the police?
  Mr. Rippon: It has always been understood that local authorities must have discretion to determine local needs. It is for that that they raise rates, and for that they are responsible to the ratepalyers. We have had many arguments about the need to reform the structure of local government finance to make it fairer and to reduce the burden of rates. I should like such legislation. However, we are now discussing a draconian power of the Secretary of State to interfere in the discretion that is normally provided by statute for elected local authorities. It must be used carefully, with discretion and rarely.
  I think that 20 is not unreasonable and sufficient for the Secretary of State's purposes. If he says that he would accept 25, so be it. It would be wrong to provide a power that could be extended almost to the point of being a general power. There is no cause for complacency when we know that, during discussion on the Local Government Finance Act 1982, the same argument was advanced—only a few authorities were to be affected by targets. What was at first a handful has now increased to 160 or possibly even more.
  In those circumstances, I hope that the Secretary of State will be inclined seriously to consider accepting an amendment such as this or another in a similar form.
  Mr. Patrick Jenkin: I am tempted to be beguiled by the charms of my right hon. and learned Friend the Member for Hexham (Mr. Rippon) and of my hon. Friend the Member for Devizes (Mr. Morrison), but I have to say that I shall not be able to advise the House to accept the amendment. My right hon. and learned Friend the Member for Hexham said that no one is saying that the Government should be defied.
  Listening to the protestations of democratic probity that came from the hon. Member for Newham, North-West (Mr. Banks), I was reminded of the brief and sharp exchange that he and I had at the end of Question Time on 8 February. I said:
  "The House might be more impressed if, instead of asking that rather pointless question…the hon. Gentleman stood up and told us whether he supports Mr. Livingstone's demand that the Labour party should defy the law on rate-capping. Will he or will he not?
  Mr. Banks: Yes." —[0fficial Report, 8 February 1984; Vol. 53, c. 879.]
  The whole House heard him. My right hon. and learned Friend has said that no one is suggesting that the Government should be defied. I fear that he is sadly mistaken, because the hon. Member for Newham, North-West made his intentions perfectly clear.
  Mr. Rippon: With respect to my right hon. Friend, I was not suggesting that no one would ever defy the Government. I was merely saying that Conservative Members, who are deeply and bitterly opposed to the principles underlying the Bill, are not saying that if it became law it should be defied. We are saying that it should not become law.
  Mr. Jenkin: I understand my right hon. and learned Friend's view. I thought that at one point he was wavering in his opposition. He said that possibly a power of selective rate capping would be appropriate if the criteria and limitations were clear. I am grateful for that.
  Mr. Tony Banks rose——
  Mr. Jenkin: Does the hon. Gentleman wish to intervene?
  Mr. Banks: I am waiting for the right hon. Gentleman to finish his sentence.
  Mr. Jenkin: I have moved on from the hon. Gentleman, but I shall give way.
  Mr. Banks: I had deferred to older and more senior Members. I am grateful to the Secretary of State for allowing me to underline what I said in answer to his question. It was strange to have a Secretary of State ask a Back Bencher to reply to a question. I believe that bad laws should be defied. There is a long and honourable tradition of bad laws being defied. Had that not been the case, there would not have been votes for women or trade union rights, by which everyone now swears. Therefore, there is nothing strange in any hon. Member saying that he or she is prepared to defy a law and take the consequences.
  Mr. Jenkin: I am glad that I gave way to the hon. Gentleman. Having that put so clearly on the record by a Member of this legislature marks the hon. Gentleman's contribution to the debate. The hon. Gentleman will not be allowed to forget those words. He is elected to this House to help to make laws. To stand up in the House and demand that laws should be defied is to betray the very democratic principles about which he was speaking earlier.
  Mr. Straw: The right hon. Gentleman's criticism of my hon. Friend should not be allowed to pass, because this is an important point. How is what my hon. Friend said different from the Prime Minister's proposition that the laws to which we are bound by treaty under the European Communities Act should be defied by the Government?
  Mr. Jenkin: My right hon. Friend has made no such proposition. It is perfectly clear, at least to Conservative Members, that if any such proposition were ever to be made—and this is entirely hypothetical—it would be made in the entirely constitutional way of changing the law in this House. But perhaps we are straying from the amendment.
  Mr. Martin Flannery: Double standards.
  Mr. Jenkin: There is no question of double standards. I was somewhat surprised at the logic of the argument of my hon. Friend the Member for Devizes. He suggested that amendment No. 25 was a paving amendment for No. 31. Amendment No. 31, which I hope we shall discuss tomorrow, will, if carried, remove part II.
  At the same time, my hon. Friend argued that the danger of part I was that, although we have debated it on the assumption — perfectly properly, as it is the Government's policy — that it is a selective capping power, part H is a general power. If there were no part II, I have to ask my hon. Friends whether there would not then be every possible temptation on the Government to seek
  218
  to extend the use of part I, because there would be no alternative other than to come back to the House. If we have part II, which is the general scheme and which has properly built into it certain provisions—this has been acknowledged by hon. Members in Committee and on Report — and if part H is hedged about with parliamentary and other safeguards, that is the proper and democratic way to do this.
  Therefore, if the circumstances ever did arise—I do not want to anticipate tomorrow's debates—and a more general capping power would be needed, there is the procedure, and the opportunity is open to the Government to come back to the House of Commons and the House of Lords and explain the reasons and seek the necessary powers under clause 9.
  Mr. Cormack: Will my right hon. Friend accept that if his thesis has any validity it is better to limit the number to 20 or 25, as has been suggested? If it does not work, my right hon. Friend has a case for coming back to the House for a new Bill. Why tag on these general powers and have an open-ended number without any restrictions?
  Mr. Jenkin: I was perhaps led astray by the argument of my hon. Friend the Member for Devizes and was anticipating tomorrow's debate. I shall be happy to answer the question asked by my hon. Friend the Member for Staffordshire, South (Mr. Cormack) if we get there. Suffice it to say that we are debating part I on this amendment, No. 25, which would limit the numbers. If there were no part II there would be a stronger case for putting a limit on, because the pressures on the Government would be to seek to achieve what must be a Government's perfectly proper objectives of containment of public expenditure and the protection of ratepayers by going further under part I than it is our intention to do. That part of my hon. Friend's argument does not stand up.
  Mr. Benyon: My right hon. Friend's speech anticipates the questions that I would have asked him if I had caught Mr. Speaker's eye. Is it really true, as is stated in the brief that has been prepared for us by three local authority associations, that there is no limit whatever to the number of authorities to be designated? If it were to be 50 or 100, what would happen on the Floor of the House?
  Mr. Jenkin: My hon. Friend anticipates my arguments, because I am going on to explain to the House how part I limits the power. It is not just open discretion. I made it clear on Second Reading and at considerable length in Committee, when we debated the matter on a number of different amendments, and I am prepared to make it clear again now. Under part I we are concerned to curb the spending and rating of the small minority of councils which have ignored all our efforts over the past four years at influence and persuasion. The Bill provides for the selection of those authorities according to general principles and we shall eventually choose the criteria for those principles in the light of the most up-to-date information. Again that is provided for in the Bill, and it will be in the 1984–85 budgets of local authorities. As that information becomes available, so we shall be able to devise our principles.
  9.15 pm
  The Bill contains a number of safeguards. If an authority is selected, it will be one which is spending excessively. We have said that in present circumstances

  219
  we consider that the number of authorities which would fall within that description would be between 12 and 20. There are the exemptions that no authority spending below GRE and no authority spending below £10 million a year, a figure which can be increased by order, could be selected. The majority of authorities need have no worry about selective limitation.
  My hon. Friend the Member for Milton Keynes (Mr. Benyon) was not a member of the Standing Committee, but he will be aware of the debates which took place on the table which I made available to hon. Members and the press in which were set out the sorts of criteria which are in our minds to use when we come to make the selection. I spelt out in the table about 11 circumstances, or combinations of circumstances, which might be used. I shall not read them all out, but I shall give one or two examples. One example is an authority whose total expenditure is 20 per cent. over GRE and 2 per cent. over its target. An authority in another group would be one with total expenditure that is 20 per cent. above GRE and whose current expenditure has increased by more than 80 per cent. since 1978–79. A third example is an authority whose total expenditure is 20 per cent. above GRE and which has added 20 per cent. to its rates since 1981–82. There is a range of criteria, and every example shows that we are proposing to deal with only a few extremely high-spending and high-rating authorities.
  Mr. Rippon: Does my right hon. Friend realise that that is what worries most of us? He has said that we shall in due course choose the principles in the light of the most up-to-date circumstances. In other words, the list is by no means exhaustive. The principles could be changed at any time, either by him or his successor. Though the list might well be used, it might not he. There is a real danger that a future Secretary of State might say to his Department, "If those are the principles, let fresh principles be found."
  Mr. Jenkin: My right hon. and learned Friend will forgive me for saying that these are paths that we trod in Committee. He will know that the Bill provides that the principles shall be laid before the House. It was argued that there should be a statutory opportunity to debate the principles. When my hon. Friend the Under-Secretary of State replied to the debate in which that argument had been advanced, he undertook to consider whether there was some weight in that argument. I feel that there is something in the argument.
  One of the strengths of our case is that the orders that will be the end of the capping process will have to be debated in the House. That is an entirely appropriate requirement. We are considering whether it would be right to provide a statutory opportunity for a debate on the principles. I think that that would go a long way, if that were so—I am speaking without commitment at this stage—to meet the problem of arbitrariness of which my right hon. and learned Friend is complaining. I am conscious of that argument and, indeed, I made it clear that one of the reasons for the Bill being drafted in its present form is that it would not necessarily be appropriate to have a constant set of principles year after year. Provided that the principles used are clear at the beginning of the process, because the Government would need the support of the House, that is a proper and appropriate way to deal with the matter.
  The amendment asks for a fixed limit of 20 designated authorities. I must make it clear that the Government have
  220
  never been rigid about the number of authorities. We have referred to 12 to 20 authorities to give some idea of the number involved. The very existence of a range shows that we cannot be precise about the number selected.
  I cannot tell the House with certainty that it would not be necessary in any year, based on clearly established principles appropriate at the time, to select one or two more than 20 authorities. If a consistent set of coherent principles were drawn up with, say, 23 authorities clearly separated from the rest, it would not make sense if the only way in which the Government could reduce that list to 20 would be to use two or three decimal places of expenditure above GRE, or some other limit set over time.
  As I have shown, the list that was discussed in Committee — I was grateful for its welcome by Committee members, as the Government try to be as open as possible in explanation— was remarkably robust in the criteria and mixes of criteria that might be used, but the total came to 20 again and again. Some combinations would bring about a total of 16 authorities, and others as many as 22 or 23 authorities.
  A coherent and clear set of principles could be devised and laid before the House to produce a figure marginally above 20 authorities. If so, a maximum of 20 would be unnecessarily restrictive. A Secretary of State should be entitled to do that, even though the number was more than 20, rather than have to twist and distort the principles to reach a maximum figure of 20. That is why I ask the House to reject the amendment.
  Mr. Straw: May I pick up the right hon. Gentleman's comment that he would not wish to be unduly restrictive?
  We understand that we may extend the number of authorities by one or two over 20, and it was suggested that 25 should be acceptable. I do not understand why that limit is not acceptable if the Secretary of State is confident that his good intentions, which we do not challenge, will be translated into Government policy when he is in office and in later years. When will the Secretary of State return to the frequent suggestion that the real reason why he does not wish to be unduly restrictive is that the White Paper requires local authorities to cut their expenditure totals by £1·5 billion by 1986 to 1987? That cannot be achieved by selective schemes.
  Mr. Jenkin: I had intended to deal with that point before sitting down, as the hon. Gentleman referred to it earlier. I seek the modest flexibility described to the House for the reasons stated and not in relation to the expenditure figures. I remind the House that the White Paper figures for public spending over the past few years have had to be raised each year to take into account the changing spending pattern.
  Local government is now spending £2·5 billion above what was planned in 1980. That is a measure of how far adrift we have been. As a result, the public expenditure White Paper figures were raised by £1,000 million in 1982–83, by £1,100 million in 1983–84 and by more than £500 million in the current year. It would not altogether surprise me or, I suspect, my right hon. and learned Friend the Chief Secretary to the Treasury if we had to come back to the House to recognise the reality of the spending pattern of local authorities.
  However, with the greatest respect, that is only part of what the Bill is about. Under part I, the only part which we hope we ever have to implement, for the first time we

  221
  shall be able to put an effective upper limit on the spending and rating of the few authorities which have contributed the overwhelming proportion of overspending over the year. Other Ministers and I have been grateful for this. Some of my hon. Friends said that they recognise the need for that and support the legislation. Nobody welcomes the Government having to take such powers. As I have said again and again, I hope that we shall reach the position where no capping——
  Mr. Cowans: While the Secretary of State cannot argue how many local authorities he can trap under part I, because he cannot put a ceiling on it, can he explain why he needs to put part II into the legislation at all?
  Mr. Jenkin: Perhaps the hon. Gentleman was not in the House when we mentioned that matter. We shall come to it tomorrow, when other amendments will be discussed and when I hope to catch your eye, Mr. Deputy Speaker, so that I can answer such questions.
  I can go one stage further, as these matters are related to the problems of the low-spending authorities. If under the Bill we can begin to cap the spending of the irresponsible high spenders we shall be able to help the lower spenders. Of course, we are subject to overall spending constraints, but we shall increase the total provision for local authorities' current expenditure as new information on budgets becomes available, as we have done in recent years. It is our firm intention to stick to our overall plans for future years so that if yet again we have to increase the planning figures for local government current expenditure we shall have to achieve that within the overall planning totals in the White Paper published on 16 February.
  I have constantly reaffirmed—the Government will live up to it—the undertaking that my hon. Friend the Under-Secretary and I gave in the rate support grant debate that, as the capping begins to take effect, we shall be able to take greater account of the efforts of low-spending authorities to keep their spending within the guidelines laid down by Parliament. If we are to do that effectively, we must have reasonable flexibility in interpreting part I.
  I hope that I have explained to the satisfaction of my hon. Friends that it would unduly tie the Government's hands if we were pinned down to a figure such as 20, suggested in the amendment moved by my hon. Friend the Member for Devizes. Therefore, I hope that the House will reject the amendment.
  Mr. Benyon: I rise with trepidation, first, because I realise that the amendment moved by my hon. Friend the Member for Devizes (Mr. Morrison), which I support, is dependent upon other amendments that will be moved subsequently, and, secondly, because I was not a member of the Committee.
  The explanation of my right hon. Friend the Secretary of State was difficult to understand. Why jib at not accepting 25, if he does not like 20? It is rather like Lot's wife, and saying, "Peradventure there is one person does not offend".
  I am concerned about the brief that we received from the three local authority associations. At present under the powers there is a limit to the number of local authorities to be designated. However, my hon. Friends must take on
  222
  board another fact. I direct my remarks particularly to my hon. Friend the Member for Norwich, South (Mr. Powley).
  9.30 pm
  There is no limit to the number of authorities included in any order made under the procedure. For the sake of argument, let us say that there are not 20 authorities but 30. On one night in the future, 30 authorities, perhaps including Norwich because its composition has changed in a local election, will be considered in a one-and-a-half hour debate on an order. My hon. Friend will be lucky if he gets three minutes to speak. The authorities will have been approached and will have been asked whether they wish to make any appeal against the order. Their views will have come back, and will have been rejected. My hon. Friend will need to stand up in the House——
  Mr. Cormack: If he gets in.
  Mr. Benyon: If he gets in—and make the case for Norwich to have so much money for education, dustbins, and so on.
  Mr. Powley: My hon. Friend might take note of the fact that I have already advised my local authority, Norwich city council, that it is likely to be rate capped, according to the examples given by my right hon. Friend the Secretary of State. In my opinion, humble though it might be, the council could engineer its finances so that it would not be rate capped and the measure was unnecessary.
  Mr. Benyon: I return to the charge that any number of local authorities might not be so well advised as my hon. Friend. What happens in those circumstances on the Floor of the House? I cannot believe that this is how a democratic system should work. I hope that, especially when my hon. Friends vote on this subject, they will imagine themselves—as I do as the representative of Milton Keynes—arguing in a one-and-a-half hour debate on an order into which their authority, for better or worse, has got itself.
  Mr. Charles Morrison: My hon. Friend the Member for Milton Keynes (Mr. Benyon) has stated the argument with his usual good sense. The hon. Member for Newham, North-West (Mr. Banks) suggested that the Secretary of State — I think that I am almost quoting the hon. Gentleman—was doing what many of his predecessors wanted to do. That may or may not have been true. If it is true, it demonstrates one of the great differences between members of the Government and Members of Parliament. Members of the Government are concerned with the exercise of power, and, not surprisingly, therefore wish to take the greatest amount of power unto themselves. Members of Parliament are concerned with ensuring that there is an adequate check on that power. Never before in recent times have any Government had a majority the size of the present Government's. If the hon. Gentleman was correct, it has been known by successive Governments in post-war days that they could not carry a measure such as this one against not only the Opposition but some of their own members. I hope that that is not the position that my right hon. Friend is proposing in the Bill. If it is, it is shameful.
  In this amendment, we are trying, as my right hon. and learned Friend the Member for Hexham (Mr. Rippon) said, to control the draconian power to interfere held by

  223
  the Secretary of State for the Environment. Nothing that my right hon. Friend the Secretary of State said militates against the inclusion of a limit on the number of local authorities that can be caught under the selective scheme. Very much the opposite is true. My right hon. Friend has confirmed my worst fears. He did not accept the amendment, and went on to confirm what I said when I moved the amendment—that, if there was no part II, the Government would use part I. I emphasise the point made by my hon. Friend the Member for Milton Keynes. My right hon. Friend should look not only at the amendment dealing with the removal of the general powers but at other amendments dealing with clause 2.
  My right hon. Friend referred also to the safeguards in clause 2(2)(b). That refers to the Government's opinion on whether a local authority appears to have proposed total xpenditure that is
  "excessive having regard to general economic conditions."
  That is a general point. I do not believe that the inclusion of such a broad control is adequate to meet the point that I have made. I feel strongly that my right hon. Friend should have been prepared to accept the amendment. As he is not prepared to do so, I hope that the House will divide on it.
  Question put, That the amendment be made:—
  The House divided: Ayes 196, Noes 288.

  Division No. 207]

  [9.36 pm

  AYES

  Adams, Allen (Paisley N)

  Corbett, Robin

  Alton, David

  Corbyn, Jeremy

  Anderson, Donald

  Cowans, Harry

  Archer, Rt Hon Peter

  Craigen, J. M.

  Ashdown, Paddy

  Crowther, Stan

  Ashley, Rt Hon Jack

  Cunliffe, Lawrence

  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'l)

  Barron, Kevin

  Deakins, Eric

  Beaumont-Dark, Anthony

  Dixon, Donald

  Beckett, Mrs Margaret

  Dobson, Frank

  Beggs, Roy

  Dubs, Alfred

  Beith, A. J.

  Dunwoody, Hon Mrs G.

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

  Eadie, Alex

  Benyon, William

  Eastham, Ken

  Bermingham, Gerald

  Edwards, Bob (W'h'mpt'n SE)

  Bidwell, Sydney

  Ellis, Raymond

  Blair, Anthony

  Evans, John (St. Helens N)

  Boothroyd, Miss Betty

  Ewing, Harry

  Boyes, Roland

  Fatchett, Derek

  Bray, Dr Jeremy

  Faulds, Andrew

  Brown, Gordon (D'f'mline E)

  Field, Frank (Birkenhead)

  Brown, Hugh D. (Provan)

  Fields, T. (L'pool Broad Gn)

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

  Fisher, Mark

  Brown, Ron (E'burgh, Leith)

  Flannery, Martin

  Bruce, Malcolm

  Forrester, John

  Buchan, Norman

  Forsythe, Clifford (S Antrim)

  Callaghan, Jim (Heyw'd & M)

  Foster, Derek

  Campbell-Savours, Dale

  Foulkes, George

  Canavan, Dennis

  Fraser, J. (Norwood)

  Carlile, Alexander (Montg'y)

  Freud, Clement

  Carter-Jones, Lewis

  Garrett, W. E.

  Cartwright, John

  George, Bruce

  Clark, Dr David (S Shields)

  Gilmour, Rt Hon Sir Ian

  Clarke, Thomas

  Godman, Dr Norman

  Clay, Robert

  Gould, Bryan

  Cocks, Rt Hon M. (Bristol S.)

  Hamilton, James (M'well N)

  Cohen, Harry

  Hardy, Peter

  Coleman, Donald

  Harman, Ms Harriet

  Concannon, Rt Hon J. D.

  Harrison, Rt Hon Walter

  Conlan, Bernard

  Hart, Rt Hon Dame Judith

  Cook, Frank (Stockton North)

  Haynes, Frank

  Cook, Robin F. (Livingston)

  Heffer, Eric S.

  Hogg, N. (C'nauld & Kilsyth)

  Pendry, Tom

  Holland, Stuart (Vauxhall)

  Penhaligon, David

  Home Robertson, John

  Pike, Peter

  Howells, Geraint

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

  Hoyle, Douglas

  Powell, Raymond (Ogmore)

  Hughes, Dr. Mark (Durham)

  Prentice, Rt Hon Reg

  Hughes, Robert (Aberdeen N)

  Prescott, John

  Hughes, Roy (Newport East)

  Radice, Giles

  Hughes, Sean (Knowsley S)

  Randall, Stuart

  Hughes, Simon (Southwark)

  Redmond, M.

  Janner, Hon Greville

  Richardson, Ms Jo

  John, Brynmor

  Rippon, Rt Hon Geoffrey

  Johnston, Russell

  Roberts, Allan (Bootle)

  Jones, Barry (Alyn & Deeside)

  Roberts, Ernest (Hackney N)

  Kaufman, Rt Hon Gerald

  Robertson, George

  Kennedy, Charles

  Robinson, G. (Coventry NW)

  Kirkwood, Archibald

  Rogers, Allan

  Knox, David

  Ross, Ernest (Dundee W)

  Lambie, David

  Ross, Wm. (Londonderry)

  Lamond, James

  Rowlands, Ted

  Lewis, Ron (Carlisle)

  Sedgemore, Brian

  Lewis, Terence (Worsley)

  Sheerman, Barry

  Litherland, Robert

  Shore, Rt Hon Peter

  Lloyd, Tony (Stretford)

  Short, Ms Clare (Ladywood)

  McCartney, Hugh

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

  McDonald, Dr Oonagh

  Silkin, Rt Hon J.

  McGuire, Michael

  Skinner, Dennis

  McKay, Allen (Penistone)

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

  McKelvey, William

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

  McNamara, Kevin

  Smyth, Rev W. M. (Belfast S)

  McTaggart, Robert

  Soley, Clive

  McWilliam, John

  Spearing, Nigel

  Madden, Max

  Strang, Gavin

  Marek, Dr John

  Straw, Jack

  Marshall, David (Shettleston)

  Thomas, Dafydd (Merioneth)

  Martin, Michael

  Thomas, Dr R. (Carmarthen)

  Mason, Rt Hon Roy

  Thompson, J. (Wansbeck)

  Maxton, John

  Thorne, Stan (Preston)

  Maynard, Miss Joan

  Tinn, James

  Meadowcroft, Michael

  Torney, Tom

  Meyer, Sir Anthony

  Wallace, James

  Michie, William

  Wardell, Gareth (Gower)

  Mikardo, Ian

  Wareing, Robert

  Millan, Rt Hon Bruce

  Weetch, Ken

  Miller, Dr M. S. (E Kilbride)

  Welsh, Michael

  Mitchell, Austin (G't Grimsby)

  White, James

  Molyneaux, Rt Hon James

  Williams, Rt Hon A.

  Morris, Rt Hon J. (Aberavon)

  Winnick, David

  Nellist, David

  Winterton, Nicholas

  O'Neill, Martin

  Woodall, Alec

  Owen, Rt Hon Dr David

  Young, David (Bolton SE)

  Park, George

  Parry, Robert

  Tellers for the Ayes:

  Patchett, Terry

  Mr. Patrick Cormack and Mr. Charles Morrison.

  Pavitt, Laurie

  Colvin, Michael

  Hunter, Andrew

  Cope, John

  Hurd, Rt Hon Douglas

  Corrie, John

  Irving, Charles

  Couchman, James

  Jenkin, Rt Hon Patrick

  Cranborne, Viscount

  Jessel, Toby

  Currie, Mrs Edwina

  Johnson-Smith, Sir Geoffrey

  Dicks, Terry

  Jones, Gwilym (Cardiff N)

  Dorrell, Stephen

  Jones, Robert (W Herts)

  Douglas-Hamilton, Lord J.

  Joseph, Rt Hon Sir Keith

  Dover, Den

  Kershaw, Sir Anthony

  du Cann, Rt Hon Edward

  King, Roger (B'ham N'field)

  Dunn, Robert

  King, Rt Hon Tom

  Durant, Tony

  Knight, Gregory (Derby N)

  Eggar, Tim

  Knight, Mrs Jill (Edgbaston)

  Emery, Sir Peter

  Knowles, Michael

  Evennett, David

  Lamont, Norman

  Eyre, Sir Reginald

  Lang, Ian

  Fallon, Michael

  Latham, Michael

  Farr, John

  Lawler, Geoffrey

  Favell, Anthony

  Lawrence, Ivan

  Fenner, Mrs Peggy.

  Lawson, Rt Hon Nigel

  Finsberg, Sir Geoffrey

  Lennox-Boyd, Hon Mark

  Fletcher, Alexander

  Lilley, Peter

  Fookes, Miss Janet

  Lloyd, Ian (Havant)

  Forman, Nigel

  Lloyd, Peter, (Fareham)

  Forsyth, Michael (Stirling)

  Lord, Michael

  Fowler, Rt Hon Norman

  Lyell, Nicholas

  Fox, Marcus

  McCrindle, Robert

  Fraser, Peter (Angus East)

  McCurley, Mrs Anna

  Freeman, Roger

  Macfarlane, Neil

  Fry, Peter

  MacKay, Andrew (Berkshire)

  Gale, Roger

  MacKay, John (Argyll & Bute)

  Galley, Roy

  Maclean, David John

  Gardiner, George (Reigate)

  McQuarrie, Albert

  Gardner, Sir Edward (Fylde)

  Major, John

  Garel-Jones, Tristan

  Malins, Humfrey

  Glyn, Dr Alan

  Malone, Gerald

  Goodlad, Alastair

  Marland, Paul

  Gorst, John

  Marlow, Antony

  Gow, Ian

  Mather, Carol

  Gower, Sir Raymond

  Maude, Hon Francis

  Grant, Sir Anthony

  Mawhinney, Dr Brian

  Greenway, Harry

  Maxwell-Hyslop, Robin

  Gregory, Conal

  Mayhew, Sir Patrick

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

  Mellor, David

  Griffiths, Peter (Portsm'th N)

  Merchant, Piers

  Grist, Ian

  Miller, Hal (B'grove)

  Ground, Patrick

  Mills, Iain (Meriden)

  Grylls, Michael

  Mills, Sir Peter (West Devon)

  Gummer, John Selwyn

  Miscampbell, Norman

  Hamilton, Neil (Tatton)

  Moate, Roger

  Hampson, Dr Keith

  Monro, Sir Hector

  Hanley, Jeremy

  Montgomery, Fergus

  Hannam, John

  Morrison, Hon P. (Chester)

  Harvey, Robert

  Moynihan, Hon C.

  Haselhurst, Alan

  Mudd, David

  Havers, Rt Hon Sir Michael

  Murphy, Christopher

  Hawkins, Sir Paul (SW N'folk)

  Neale, Gerrard

  Hawksley, Warren

  Nelson, Anthony

  Hayes, J.

  Neubert, Michael

  Hayhoe, Barney

  Newton, Tony

  Hayward, Robert

  Nicholls, Patrick

  Heathcoat-Amory, David

  Norris, Steven

  Heddle, John

  Onslow, Cranley

  Henderson, Barry

  Oppenheim, Philip

  Hickmet, Richard

  Oppenheim, Rt Hon Mrs S.

  Higgins, Rt Hon Terence L.

  Osborn, Sir John

  Hill, James

  Ottaway, Richard

  Hind, Kenneth

  Page, John (Harrow W)

  Hirst, Michael

  Page, Richard (Herts SW)

  Holland, Sir Philip (Gedling)

  Parris, Matthew

  Holt, Richard

  Patten, John (Oxford)

  Hooson, Tom

  Pattie, Geoffrey

  Hordern, Peter

  Pawsey, James

  Howard, Michael

  Peacock, Mrs Elizabeth

  Howarth, Gerald (Cannock)

  Percival, Rt Hon Sir Ian

  Howell, Ralph (N Norfolk)

  Pink, R. Bonner

  Hubbard-Miles, Peter

  Pollock, Alexander

  Hunt, David (Wirral)

  Porter, Barry

  Hunt, John (Ravensbourne)

  Powell, William (Corby)

  Powley, John

  Tapsell, Peter

  Price, Sir David

  Taylor, Teddy (S'end E)

  Proctor, K. Harvey

  Temple-Morris, Peter

  Rathbone, Tim

  Terlezki, Stefan

  Rees, Rt Hon Peter (Dover)

  Thomas, Rt Hon Peter

  Renton, Tim

  Thompson, Donald (Calder V)

  Rhodes James, Robert

  Thompson, Patrick (N'ich N)

  Ridley, Rt Hon Nicholas

  Thornton, Malcolm

  Ridsdale, Sir Julian

  Thurnham, Peter

  Roberts, Wyn (Conwy)

  Townend, John (Bridlington)

  Robinson, Mark (N'port W)

  Townsend, Cyril D. (B'heath)

  Roe, Mrs Marion

  Tracey, Richard

  Rossi, Sir Hugh

  Trotter, Neville

  Rost, Peter

  Twinn, Dr Ian

  Rowe, Andrew

  van Straubenzee, Sir W.

  Rumbold, Mrs Angela

  Vaughan, Sir Gerard

  Ryder, Richard

  Waddington, David

  Sackville, Hon Thomas

  Wakeham, Rt Hon John

  St. John-Stevas, Rt Hon N.

  Waldegrave, Hon William

  Sayeed, Jonathan

  Walker, Bill (T'side N)

  Shaw, Sir Michael (Scarb')

  Waller, Gary

  Shelton, William (Streatham)

  Walters, Dennis

  Shepherd, Colin (Hereford)

  Ward, John

  Shepherd, Richard (Aldridge)

  Wardle, C. (Bexhill)

  Silvester, Fred

  Warren, Kenneth

  Sims, Roger

  Watson, John

  Skeet, T. H. H.

  Watts, John

  Smith, Sir Dudley (Warwick)

  Wells, Bowen (Hertford)

  Smith, Tim (Beaconsfield)

  Wells, John (Maidstone)

  Soames, Hon Nicholas

  Wheeler, John

  Spencer, Derek

  Whitfield, John

  Spicer, Michael (S Worcs)

  Whitney, Raymond

  Stanbrook, Ivor

  Wilkinson, John

  Steen, Anthony

  Wolfson, Mark

  Stern, Michael

  Wood, Timothy

  Stevens, Lewis (Nuneaton)

  Woodcock, Michael

  Stevens, Martin (Fulham)

  Yeo, Tim

  Stewart, Allan (Eastwood)

  Young, Sir George (Acton)

  Stewart, Andrew (Sherwood)

  Younger, Rt Hon George

  Stewart, Ian (N Hertf'dshire)

  Stokes, John

  Tellers for the Noes:

  Stradling Thomas, J.

  Mr. Robert Boscawen and Mr. Timothy Sainsbuiy.

  Sumberg, David

  Question accordingly negatived.

Clause 2

  DESIGNATION OF AUTHORITIES
  Mr. Charles Morrison: I beg to move amendment No. 26, in page 2, line 23, after 'report', insert 'or reports'.
  Mr. Deputy Speaker (Mr. Harold Walker): With this it will be convenient to take the following amendments:
  No. 27, in page 2, line 26, leave out
  'or, as the case may be, each of the authorities'.
  No. 6, in page 3, line 12, leave out `or authorities'.
  No. 7, in page 3, line 12, leave out 'have' and insert `has'.
  No. 29, in page 3, line 12, at end insert—
  `(6A) No report made by the Secretary of State under subsection (1) above shall come into effect unless a draft thereof in the form of a Statutory Instrument has been laid before and approved by a resolution of each House of Parliament.'.
  No. 8, in page 3, line 13, leave out subsection (7).
  No. 30, in clause 3, page 3, line 22, at end insert—
  '(lA) The determination of the Secretary of State in accordance with subsection (1) above shall not come into force unless a draft thereof in the form of a Statutory Instrument has been laid before and approved by a resolution of each House of Parliament.'
  No. 12, in clause 4, page 5, line 10, leave out from `unless' to end of line 11 and insert
  'it has been approved by a resolution of each House of Parliament'.
  No. 35, in clause 4, page 5, line 12, leave out
  'may relate to two or more authorities'
  and insert
  `shall relate only to one authority.'.
  No. 14, in clause 4, page 5, line 12, leave out
  'relate to two or more authorities'
  and insert
  `only relate to one authority'.
  No. 28, in clause 4, page 5, line 12, leave out 'two or more authorities' and insert 'only one authority'.
  Mr. Morrison: As we know, and as indeed the Secretary of State has conceded, the Bill involves a major shift in power from local government to the centre. The aim of this group of amendments—Nos. 26, 27, 6 and 7 are the ones which are in my name and the names of my hon. Friends—is to ensure that, if there is to be such a movement of power to the centre, at least that power will be under the supervision of Parliament rather than within the virtually unfettered control of Whitehall.
  I use the word "Whitehall" purposely for, make no mistake about it, what the Bill involves in practice is a movement from democratically elected local representatives to civil servants in the Department of the Environment. The Secretary of State will do little more than rubber-stamp their decisions, and I do not exaggerate. Ministers, after all, are extremely busy people who have a very heavy workload, day in and day out.
  Let us say that the Secretary of State initially makes a decision to examine the budgets of a considerable number of local authorities. Let us say that he considers it correct to examine the budgets of 30 to 40 local authorities on the basis that he thinks that that number of authorities may be spending excessively. Let us say that out of those 30 to 40 he might finally designate 16. Does anyone really believe that Ministers in the Department of the Environment will have the time to pore over 30 budgets and consider the arguments for them and for the expenditure that they include? Of course they will not.
  Mr. John Page: Does it occur to my hon. Friend in these days of the magic of modern science that all that the Secretary of State has to do is press one tiny button and all these things will come up on the computer telling him exactly what is going on?
  Mr. Morrison: On the logic of my hon. Friend, it surely follows that the Chancellor of the Exchequer could each year press one tiny button and out would jump the whole of his Budget. I do not think that my hon. Friend would assume that that was so, but what is the difference between the Budget of my right hon. Friend the Chancellor on the one hand and the budgets of several hundred local authorities on the other? Both, as we know full well, are subjected to the most detailed examination, recommendations by committees, scrutiny by officials, either at local level or in Whitehall, and ultimately decisions by, in the case of the Government, the Chancellor and, in the case of a local authority, perhaps the chairman of the finance committee, who makes recommendations to his committee. Therefore, I cannot see that the situation is quite as simple as my hon. Friend suggests, much as I wish it were, because then huge savings could be made. But I do not think that it is very realistic to assume that they can be.
  In my view, given the picture that I have indicated, which might well come about, it will be civil servants
  228
  rather than Ministers who will undertake the detailed examination of the budgets of those local authorities which are thought to be overspending.
  It is therefore very important that Parliament should have the power to consider each local authority proposed for designation. After all, local government is local. That should be stating the obvious, but it seems to me that often it is forgotten. It seems to be only too often forgotten that every local authority area has different problems, and every group of locally elected councillors has different views as to what the priorities for action and expenditure may be. It is no use lumping local authorities together and pretending that one standard can be appied to all for all expenditure. To do so would be unrealistic. Every budget should be considered in detail and the various considerations taken into account by the House.
  Dr. Keith Hampson: I have sympathy with some of my hon. Friend's points, but I find it hard to follow his logic. If local government is local, why should this House consider in detail local authorities' budgets? If we give power to my right hon. Friend the Secretary of State to have discretion over a broad area, he should be allowed to exercise it.
  Mr. Morrison: The last thing I want is for my right hon. Friend the Secretary of State or the House to have the power to look at local authorities' budgets. However, if power is to be centralised by the Bill, the scrutiny and consideration of each authority's budget should be carried out individually by the House rather than collectively by my right hon. Friend using dictatorial powers.
  I am sure that my hon. Friend is well aware of the contents of the Bill. Part I provides that a designation order can cover a number of authorities. That would hinder parliamentary consideration of whether the circumstances of each authority had been considered before the authority was designated for rate capping. Indeed, it would preclude parliamentary control of the whole capping process.
  It might be argued that one authority per report, which is the purpose of the amendment, would be a cumbersome process for Parliament. My reply is that, if the Government are putting forward such legislation, they must live with the consequences of parliamentary control. As my right hon. Friend the Secretary of State has constantly reiterated, if selective limitation is to apply to only a few authorities, the process proposed in the amendments would not be too cumbersome for the House.
  Parliament should decide how much time it devotes to each report. It need not give detailed or lengthy consideration to every authority. Some authorities obviously spend way in excess of what is reasonable, and the House could deal with them swiftly. The House should have the opportunity to examine each local authority, and it will have that opportunity only if the amendments are accepted, as I hope they will be.
  10 pm
  Mr. Simon Hughes: When I made my maiden speech here, I was followed by the hon. Member for Devizes (Mr. Morrison). Little did I think then that a year later we would find ourselves on the same side on a matter as important as—if not more important than—the Budget, which was the matter that we were debating a year ago. I welcome his temporary removal to the side of the more numerous on this issue,

  229
  and I only wish that the numbers here reflected the numbers outside. Probably never in the history of legislation have so many elected people taken a similar view against that of so few elected people.
  We all received a briefing from the Association of County Councils, the Association of District Councils and the Association of Metropolitan Authorities, representing many different parts of the country, united in the principle that they want to be allowed to make their own decisions or, at least, to be considered on their own, and not lumped together. The arguments adduced a moment ago by the hon. Member for Devizes struck a chord and are fully supported by those of us on the Liberal and Social Democratic Benches, those on the Labour Benches, many sitting on the Government Back Benches and, until recently—if we read the writings of certain people—even by some on the Government Front Benches.
  This group of amendments includes amendments Nos. 12 and 14, standing in the names of my right hon. and hon. Friends, which succinctly put our case. They propose that if the Secretary of State is to designate an authority he should do so only when both Houses of Parliament have considered the circumstances of that authority. The hon. Member for Leeds, North West (Dr. Hampson) suggested that his local community, a part of that fine city of Leeds, would be happy for the Secretary of State to take the power, and happier — if we are to believe what he represents—than if we were to look at the Secretary of State's actions and those of his officials. I do not believe that. I do not believe that the citizens of west Leeds are any different from the citizens of north-west Leeds.
  Mr. Straw: More perceptive.
  Mr. Hughes: More perceptive they may be, but I am sure that they all believe that Leeds should be looked at separately and considered on its own. If they cannot have the guarantee that any representative of that city in this place can have a say in decisions about the financing of their authority, they would be even more deprived than they already are in other ways as a result of this Government's actions.
  Dr. Hampson: I was making the point that in many areas of legislation, and this is no exception, we in this House grant discretionary powers to Secretaries of State. There is no better example of that than education, because in 1944 the House granted a free and easy set of powers to the Secretary of State, who runs the education system, in a broad manner, through regulations. I do not understand why Labour Members believe that the detailed provisions of a local authority budget should be debated on the Floor of the House.
  Mr. Hughes: There is a point of principle. If local authorities are losing powers to central Government, it is better for elected people at least to have a say than to leave it to one elected person supported by officials. The number of times when the Secretary of State has used the powers that have been given to him in the context of education are extremely limited, because he is aware of the danger of doing so, but that is not true of the Secretary of State for the Environment, who has declared his intention of capping local authority rates. He goes into this area of
  230
  potential absolute power determined to do something in a totally different context, and one that does not follow the precedent in the Education Act 1944.
  We take the view that both Houses of Parliament should be consulted, because we believe that there should be two Houses of Parliament. We should like to reform the other House considerably, but even in an unreformed state, it may not do too bad a job on this legislation. Certainly we should be thankful that it is there. I remind the House that there are some hon. Members who believe that there should be only one Chamber. One Chamber, an authoritarian Secretary of State and rate capping bodies bodes far more ill than two Chambers, and that is why the legislation should go to two Chambers for consideration, if it must exist. [HON. MEMBERS: "Hear, hear."] It is clear that there are supporters for that proposition on both sides of the House. One is sometimes surprised from where support comes.
  I have three questions for the Minister. First, what are the criteria that the Government will use for rate-capping and for designating authorities? During the passage of what is now the Local Government, Planning and Land Act 1980, the criteria which the Secretary of State said would be included among the various criteria to be established under that measure were the speeches made by the leaders of the local councils. I suggest that even the hon. Member for Harrow, West (Mr. Page) would find difficulty in putting in his computer a print-out of the speeches of the leaders of the local authorities, tabulating them in such a way as to establish proper criteria.
  Mr. John Page: The leader of Harrow council is one of the leading computer experts in the country. Within a moment of any statement being made by the Secretary of State, or anybody else, he is able to feed it into the computer and, within seconds, to receive an answer. I beg the hon. Gentleman to choose someone other than myself or the leader of Harrow council.
  Mr. Hughes: I am glad to know that there is some remaining expertise, other than in the hon. Member for Harrow, West, in Harrow, although I gather that the opposition on that authority is catching up fast. The criteria for GREAs—the criteria that will determine all of these decisions—should be known to us at this stage and should not be left to decisions about which we shall not even be told as the measure proceeds through Report and Third Reading.
  The second complaint is that by lumping together lock, stock and barrel local authorities with 100 council houses, and councils, such as Liverpool and Birmingham, with 60,000 and 70,000 council houses, along with local authorities representing small rural areas or large rural areas containing small populations and local authorities representing inner city areas, it is impossible for those who work in Marsham street, diligent though they may be, properly to understand, reflect and legislate — that is what they will be doing — for the people in those different communities.
  How is it possible for the Secretary of State to contemplate—he may say that he would not be willing to do so — with one sweep of his legislative pen in Marsham street, putting Hereford and Hackney, Leeds and Liverpool, Bodmin and Bermondsey in the same order and saying, "They must all receive the same group treatment", herded through with the same deficient and inadequate resources at the end of the day?

  231
  They have different problems, they face different issues, they have different concerns and they are of different political complexions. The people who will stand in those places for election—most of them will still have elections after next year; some may not, but most will —will be most in tune with their local electorates and their needs.
  Thirdly, is it still the Government's contention that they want by these provisions—by grouping together local authorities and determining the rates in Westminster for the rest of the country—to keep down the high spending councils which they allege have made this legislation necessary? Or is it that they want to do something else? If they are thinking about the control of public expenditure, why is the Treasury not introducing and piloting this legislation through?
  The answer may be that the Department of the Environment is doing it because it believes that local government should be run from Whitehall. If the
  232
  Department believes that it can group together authorities in the north and the south, wherever they may be, it must be clear that those authorities will not receive the same level of consideration. Instead, they will have a sledge hammer attack from the Government and will not have the safeguards which they have enjoyed for decades and, in some cases, for hundreds of years.
  The newspapers have been full of complaints— we have heard about the Financial Times and many others — that there is no evidence that the Bill will reduce local government expenditure. If that is true—we are considering the wisdom of experts, not of politicians—this is not a Rates Bill, but a local government removal Bill. It will be improved if this group of amendments is passed. It should be improved, even at this late stage, before the other place tells us how badly we have got it wrong. After all, it is we who are supposed to he the elected representatives.
  Mr. Straw: This is an ecumenical selection of amendments as it includes Opposition amendments nos. 29, 30 and 35 as well as those tabled by Conservative and alliance Members. I congratulate the hon. Member for Southwark and Bermondsey (Mr. Hughes) on a fine Second Reading speech. As the hon. Member for Devizes (Mr. Morrison) said, this group of amendments concerns the crucial issue of parliamentary scrutiny of legislation which has greater constitutional implications than any other wholly domestic legislation that has been passed since the second world war. I naturally exclude the Common Market legislation of 1972. I remind Conservative Members who are tempted to support the Bill, certainly not because they have been convinced by reasoned argument, but perhaps because of the prospect of preferment or loyalty, that it is Conservative Members who have described the Bill as draconian and have said that it will lead to elective dictatorship. They have condemned it in rounder terms than any Opposition Members.
  I am not sure of the name of the leader of Harrow borough council who runs a computer, but we should not forget that computers run on the basis of trash in, trash out. However, a Conservative councillor from Harrow called Mr. Ron Grant bitterly criticised this Bill at the recent Conservative local government conference. He said:
  "If cuts are not to bite too deeply, they must be phased in over a few years. We were not elected to make big cuts in service, and we risk being not elected."
  Mr. Grant was absolutely right.
  Mr. John Page: He is not from Harrow, West.
  Mr. Straw: He will be interested to hear that, but I am sure that he is a Conservative councillor from Harrow.
  Mr. Meadowcroft: It was obviously the rate support grant.
  Mr. Straw: It is a joke. I thought that I was being slow, but I now realise that that was a Liberal joke.
  Mr. Meadowcroft: It was "Harrowing".
  Mr. Straw: One of the issues to which the amendments address themselves is what scrutiny there should be of clause 2 by which the Secretary of State designates authorities by reference to principles that he lays down. Under clause 2(1), the Secretary of State must lay a report itemising the principles and the authorities so designated, but there is no provision for that report to be debated by the House. We believe that that major defect in the Bill will lead to a major loss of parliamentary scrutiny at a critical point in the development of rate-capping policies.
  It is from the determination of the principles that the original list of authorities that are likely to be rate-capped is drawn up. Conservative authorities might well be caught, especially if more than 25 authorities are rate-capped. If the principles are wrong, unfair or harsh, Parliament will have no opportunity to debate them or have them changed before they are set in tablets of stone. The whole machine will then roll on, finally to produce authorities that are the subject of designation.
  10.15 pm
  When this was debated on Second Reading, my hon. Friend the Member for Copeland (Dr. Cunningham) said:
  "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."
  234
  The Secretary of State intervened and said:
  "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."
  My hon. Friend continued:
  "We shall examine the matter in some detail in Committee. The Secretary of State's interpretation of the Bill is different from my own."—[Official Report, 17 January 1984; Vol 52, c. 180.]
  We examined the matter in Committee, and after a somewhat esoteric discussion we understood what the Secretary of State was saying. He was not trying to imply, as we had inferred, that there would be full scrutiny of the report laid before the House but that that scrutiny would arise only under clause 4 when the expenditure limits were made.
  The Secretary of State referred earlier to a recognition of the case for proper scrutiny at this stage of the principles that are laid down, and we look forward to hearing from him again. To save him an argument, I should point out that we recognise that some of the amendments to clause 2 propose a debate on the individual authorities at that stage. As the central part of any debate on the report laid under clause 2 will be the principles rather than the authorities, we appreciate that it may well be appropriate to have one debate on the principles. Therefore, we would not push the argument for separate debates on separate authorities at that stage, although I hope that the Secretary of State will acknowledge that if he or his successor establishes principles or classes of authority which differ to any considerable extent they should be debated separately.
  I remind my hon. Friends that clause 2(5) identifies six separate classes and that on top both the ILEA and the GLC are classes by themselves. It would be a matter of regret and, indeed, objectionable if there were separate classes although, as we debated in Committee, the Bill provides for that possibility.
  The second issue raised by the amendments is the scrutiny of the reports under clause 4. At present the Secretary of State determines a maximum level of expenditure for each authority to which he has not given a derogation and then includes every authority to be rate capped within a single report. Although we have had undertakings—which I hope Ministers and the Whips will keep to — that there will be a full day's debate rather than one lasting an hour and a half, even a full day's debate would be wholly inadequate to deal with the designation of 20, 25 or even a dozen individual authorities.
  Let it be made clear at this stage of the process that the determination of the maximum expenditure levels is tailored to individual authorities and the Secretary of State has taken into account individual authorities' expenditure levels and circumstances in deciding whether or not they will be subjected to derogation, what requirements they will be subjected to if there is a derogation and, if not, whether they should be included in the final list under clause 4.
  I ask Conservative Members, and in particular the hon. Member for Milton Keynes (Mr. Benyon), what will happen if a local authority——
  Sir William Clark: Buckingham.
  Mr. Straw: I think that I have the constituency correct. The hon. Member for Croydon, South (Sir W. Clark) has a defective memory. He is thinking of the position before the 1983 election.
  The hon. Member for Milton Keynes asked what any of us would think if our authorities were to be subjected to rate capping. They would be faced with a traumatic future because they would be forced not only against their will but against their better judgment, and by definition against the better judgment of their electors—outside London there are regular elections each year and local authorities have a fresh local mandate — to cut expenditure by 5 or 10 per cent. We have discussed these percentages as if they are relatively small, but a 5 per cent. cut in home help services is a 100 per cent. cut to those who lose those services. This is something that we forget time and again, when arguments about services to individuals are reduced to arithmetic, and particularly the arithmetic of percentages.
  For example, if Hertfordshire loses its school meals service, that may be only 3 or 4 per cent. of its total expenditure, but it is a 100 per cent. loss of school meals to children that are vital to their health and welfare. These are crucial issues.
  Moreover, in many cases the authority will feel that it has been unfairly treated and the Secretary of State has not taken full account of the arguments that are advanced at the time of the derogation. It will wish to put its views through Members on the Floor of the House. I have no doubt that the Minister will wish to offer an explanation showing why he has come to his view. It is not possible properly to scrutinise the effects of these decisions on each authority within the context of a single day's debate. It makes a mockery of the Secretary of State's undertaking that this would be the subject of proper parliamentary scrutiny to try to deal with it in a single day.
  My last point concerns whether a negative or affirmative procedure should be used. We believe that it is a self-evident truth that because of the importance of this Bill and of the procedures in it, wherever parliamentary scrutiny is required by the Bill, that can be effective only if the affirmative resolution procedure is followed.
  These amendments improve and increase the chance of Parliament fulfilling a proper role of scrutinising the great power that the Executive will take under the Bill, and I commend them to the House.
  Mr. John Fraser: In the Mikado it is a tailor who is the executioner. You, Mr. Speaker, are the tailor, but the executioner is the Secretary of State. I rise to say something about Lambeth council and the ILEA, which are two of my authorities. It is wrong that the Secretary of State should seek to put a council such as Lambeth, or any other council, such as Liverpool, into a group of councils and seek to dictate from Whitehall the level of expenditure.
  Three years ago, in Lambeth in 1981, we had extensive riots that set a pattern for riots throughout the country, frightened the Prime Minister and the Government and brought about some changes in policy. They certainly brought about a change in the policy towards the police.
  One of the consequences of the riots was that the Government recognised the need to have better relations between the police and the general public. They began employing more policemen. More policemen were put on the beat and police expenditure was increased. A direct
  236
  consequence of the riots in Brixton and Lambeth was the inquiry which was presided over by Lord Scarman, which made a number of excellent recommendations concerning the police, the general public and policing. The recommendations made the police in practice, if not in law, more accountable to the community in which they served. The Scarman report stated that one of the causes of the riots and social upheaval in Brixton was the general state of unemployment, bad housing and other social conditions with which any local authority is entirely concerned.
  Since 1981, when the Scarman inquiry took place into conditions in Lambeth and Brixton, almost everything has become worse. The level of rate support grant has decreased since the Brixton riots from about £52 million in 1981 to £49 million in the forthcoming year. If inflation is taken into account, the reduction in Government support for Lambeth has decreased more markedly since the riots of 1981.
  Another social condition which Lord Scarman observed was unemployment. It was about 15,000 in Lambeth in 1981 and it is now 23,000. This means that one man in every four is out of a job in the borough within my constituency. Unemployment has become worse since 1981. Another measure of deprivation is that of homeless families. The quarterly receptions for those who are accepted as homeless has increased since 1981. Almost every measure of poverty and deprivation in Lambeth has become worse since 1981, usually as a direct result of the Government's monetary policies. Unemployment has reached the level when 50 people are chasing every vacancy on the local employment register.
  The Minister is suggesting that we override all the recommendations of the Scarman report. He is seeking from Whitehall to direct expenditure levels and the policy decisions of a locally elected council. The Lambeth council is trying to implement many of the recommendations in the Scarman report and to cure many of the social evils that were highlighted in it.
  Mr. John Heddle (Mid-Staffordshire): Does the hon. Gentleman accept that it is possible that the blind ignorance of the local authority for years and years created the conditions that brought about the conditions that caused the Scarman inquiry to take place after the 1981 riots?
  Mr. Fraser: One of the main causes of the riots was the blind ignorance for many years of the metropolitan police force, which was unaccountable to the general public and the community. It was that lack of unaccountability which led to rebellion on the streets.
  One of the lessons to be learnt is that if we bypass democracy and remove accountability, which is what the Government are doing by attacking local authorities as a class, the people find another means by which to protest. I hope that we shall have no further social unrest, but the chances of increasing social unrest are much greater when the Government can act unaccountably and treat local authorities generically instead of at least examining the conditions which give rise to the Goverimint's judgment of the level of expenditure of a particular authority.
  Lambeth has been willing to submit to some form of arbitration between the local authority and central Government. It has suggested to the Secretary of State and the Prime Minister that there should be a sequel to the

  237
  Scarman inquiry whereby someone, who can be appointed by the Government, such as Lord Scarman or some other judicial figure of his standing, would examine the current social conditions, which are very much worse than those which prevailed three years ago. He would listen to evidence from the Government, from the local authority and from voluntary and local organisations and then make a judgment on the proper level of expenditure to be undertaken by the borough and the proper level of Government support.
  We would be willing to abide by such arbitration for a local authority in dispute with the Government. However, the Minister is denying any sort of dialogue between the local authority and the Government. There will be no real dialogue if the Secretary of State treats local authorities as a class.
  10.30 pm
  It is important to have an individual inquiry and debate into the Secretary of State's judgment in relation to the Inner London Education Authority. Of course, the Government say that the ILEA spends a great deal of money. That is not in dispute. The electors of London choose to spend more money on and put a great priority on the education of their children than the Secretary of State for Education and Science or the Secretary of State for the Environment.
  Like many London Members, I have been to several meetings at schools during the current campaign. The largest meetings are packed with people in the middle of the political spectrum. I have always said to them that they have a choice of whether they spend some of their money on rates for the education of their children, the provision of nursery education, further education and scholarships, or they can vote out of power a Labour ILEA and choose instead to spend their money on private consumption.
  The overwhelming opinion, not from people on the Left, or extremists, but from the central core of parents and ratepayers in my constituency, is that they prefer to spend their money on their children than to spend it on themselves. If that is the judgment that they make at the ballot boxes, which can be exercised by the ILEA without taking a single penny from Government funds, that is their prerogative. There is no case for the Government treating the ILEA in that way and seeking to interfere with its democratic mandate. The least that the Government could do, if they choose to interfere with the democratic process, would be to allow a report and a debate on that gross interference with local authority discretion.
  Dr. Hampson: I am tempted to take up the final point made by the hon. Member for Norwood (Mr. Fraser). It had a certain poignancy or irony about it. Suddenly supporters of the Labour party are in favour of parents having the right to spend on the education of their children rather than on themselves. That argument has often come from Conservative Members. Opposition Members constantly oppose the idea that parents should have the right to spend on the education of their children. If the hon. Gentleman is going to use that argument, I hope that he will be consistent. When we talk about the assisted places scheme and the right of parents to obtain private education for their children, I hope that he will use the same argument.
  238
  I accept the hon. Gentleman's argument that places such as Lambeth and Liverpool have deep-seated problems. Conservative Members are just as concerned about them as the hon. Gentleman and his colleagues. However, that is not the debate in this part of the Bill. The hon. Gentleman is arguing that, because Lambeth has particular problems, it should be entitled to a debate on the Floor of the House; it should not be regarded as part of a class of authorities. I shall address myself to that point first. It goes against the entire tradition of what has been done in local government by all parties and all Governments, including the Government of whom the hon. Gentleman was a member. Rightly, it has always been a basic principle in local government finance that no Government single out one authority as against another. How can we legitimise the argument put forward by the hon. Gentleman that the local authorities should be treated specifically on expenditure reductions when we deliberately do not single them out when we pay grants?
  Mr. Cowans: I listened carefully to the hon. Gentleman. He said that the Government do not single out local authorities. I agree with him. That is true, up to now. What exactly does the selective scheme do?
  Dr. Hampson: In the principle about which I am talking, there is no difference between what is happening under the new formula of block grant and what happened before. All Secretaries of State have had certain levers or multipliers — that is the fashionable word — at their disposal. The hon. Member for Blackburn (Mr. Straw), who is not in the Chamber at present, has constantly made fun of the present scheme. He listed all the multipliers. Multipliers existed under the old scheme, with multiple regression analysis, which, I suggest, was more confusing than the present scheme.
  It has never been the case that any Secretary of State could vary the amount of grant to a specific authority. He could vary only the way the grant bore on authorities by class—whether district or county councils. It is perverse to say that, although we say that we stick to that principle —that is right because we do not want the Secretary of State when paying grants to discriminate for personal or political reasons in favour of a particular authority—it flies out of the window when considering the purposes of the Bill.
  Authorities should be treated as a class by the Secretary of State for the purpose of levying penalties. It is an important principle that we should not treat this matter on the basis suggested by the Opposition and that the rate support grant formula is applicable by class of authority.
  The hon. Member for Southwark and Bermondsey (Mr. Hughes) riposted to me that education was in a different category from the subject we are discussing. My analogy was appropriate. The powers we give to the Secretary of State for Education and Science are broader than those we give to any other Secretary of State. Virtually everything that has happened in British education practice has been done under broad powers and regulations governed by the Secretary of State. Hardly any of the regulations on British education have been debated on the Floor of the House.
  We could argue that they should have been so debated, but there is a tradition of giving broad discretion to members of the Executive. The Secretary of State has, for example, launched a series of major initiatives into the curriculum, which develop the work done by his

  239
  predecessors, including Mrs. Shirley Williams, who is now part of the alliance. She began the great debate with the former Labour Prime Minister on the curriculum. There is no statutory requirement for that to be done. It has not been debated by the House as a change in the law. That action is covered within the broad terms of legislation passed 39 years ago.
  It is legitimate that at times we give Secretaries of State broad powers, and they can thereby operate the minutiae of the system.
  Mr. Chris Smith rose——
  Mr. Simon Hughes: The difference is, as I recall from reading—not from memory because 1944 was before I was born—that the local authorities were happy that the Secretary of State should have the power to ensure equality between local education authorities. This legislation is totally opposed by the local authorities which envisage the Secretary of State removing rather than giving them certain benefits.
  Dr. Hampson: The hon. Gentleman is not a historian. There were fearsome rows about the proposals in the 1944 Act from all kinds of vested interests. A notable one was the Church interest. It proves that vested interests that have something at stake will always fight tooth and claw to preserve their privileged position. That happened when we debated the 1944 Act, and it happens now, Local authorities have a position to defend and they will use every means at their disposal in defending it. They will oppose what is being proposed by the Government. That does not necessarily prove the argument in terms of constitutional propriety.
  It seems odd, given the track record of the House and the principles upon which we have always operated, that on this occasion we are suddenly saying that we, as a legislature, should crawl over the budgets and details of 10, 12, 15 or 50 local authorities. Are we a legislature or an administrative department of state? The job of this House is to pass broad powers, not to scrutinise in detail the budgets or practices of individual local authorities.
  To add a further point about the practical operation of the proposal for local authorities, I had the privilege of being tangentially attached to the Department of the Environment, and I do not know of one year during the four years that I was there when local authorities did not plead passionately on their knees for better particulars of what they were obliged to do. "Where do we stand?" is almost the catch phrase of local authorities. They have belaboured the Government and complained that the rules of the game change year by year and that they do not know where they stand. I say to those right hon. and hon. Members putting forward these proposals that, whatever their feelings about the Bill, what they are saying about this clause is nonsense, from the point of view not just of the House but of local authorities.
  The idea that the House should debate in detail the affairs of 10, 12, 20 or 50 authorities is nonsense. Where would they stand? Months would go by, not just days. I suggest that in terms of principle and practicality——
  Mr. Charles Morrison: My hon. Friend should not forget that my right hon. Friend referred to 16 to 20 local authorities and not 50. If my hon. Friend talks in terms of 50, he is confirming our worst fears. Is he saying that he
  240
  is happy for the Secretary of State to be personally responsible for determining the budgets of 50 or more local authorities?
  Dr. Hampson: I shall recap what I was saying. I believe that there is an issue of principle as to what this place is about. It is a legislature to give broad powers to Secretaries of State to do various things. I have cited the analogy of education. My hon. Friend is plainly against giving the Secretary of State the powers, and that is a legitimate argument. It is what the House must decide. If the House believes that a Secretary of State should have certain powers, it should leave it to him to operate the minutiae.
  I return to the practice as it affects local authorities. My hon. Friend the Member for Devizes (Mr. Morrison) mentioned 50. If my right hon. Friend and his predecessors are correct, these powers will be like a sword of Damocles over the system. That is the whole point of them. My right hon. Friend has said several times recently, and he is right, that the threat of this legislation has tamed local authority budgeting and rate demands to an extraordinary extent.
  It is possible to have some discipline in local authority finance. If the powers in the Bill, direct and implied exercise discipline over local authority finance, it will be a good thing. We are talking of only a handful of local authorities. If we are to have, as Opposition Members hope, a landslide in their favour and Liverpool councils writ large or even small throughout the land, and anything verging on the attitudes we see in Liverpool, many local authorities will deliberately flout the Government, even if it is their own Labour Government. We know what Liverpool has said to the Labour leader. So we could end up with 50 authorities involved.
  We are debating the principle and putting into statute something that must apply in any situation. Frankly, to use Haigspeak, it boggles the mind to think of the affairs of a couple of dozen to 50 authorities being debated on the Floor of the House.
  10.45 pm
  Mr. Chris Smith: The hon. Member for Leeds, North-West (Dr. Hampson) said that the House should not engage in detailed consideration of local authority budgets. In an ideal world, if there was no suggestion of the Secretary of State taking upon himself the powers enshrined in the Bill, I should entirely agree. However, the Secretary of State is taking power not just to cap the rates of local authorities but, in so doing, to abrogate all the detailed discussions that authorities now undertake regarding the nature of their budgets, their expenditure and the services provided to their local communities. If he does that, he must of necessity undertake close scrutiny of the detailed expenditure of the authorities concerned, and as it is the duty of Parliament to scrutinise the activities of the Executive, the House must give the same detailed consideration to these matters.
  We are talking not just about an exercise based on an arbitrary set of figures with percentages whistled up to catch the number of authorities that the Secretary of State wishes, but about the effect on the people in the areas affected in terms of redundancies, lost services and inability to make desperately needed improvements in services. That will be the detailed impact of the legislation. Any Secretary of State seeking to cap the rates of an authority or a series of authorities must undertake the

  241
  most careful consideration of those factors and the consequences of his proposed action. If he does not do that, he will be abrogating the responsibilities that he seeks to exercise as Secretary of State.
  The legislation effectively takes the power of local authority budgeting and consideration of services away from the local authority, so that the Secretary of State will make decisions which should properly be made by the authority. Because the Secretary of State will be making those decisions, this Chamber — the democratic and accountable forum to which he is answerable — must itself undertake the same detailed consideration.
  It is not the same as the Secretary of State simply being given a general power and a general responsibility and being told to go away and exercise it, as happens to a certain extent under the present education legislation. The Secretary of State is taking upon himself powers which at the moment belong to democratically elected authorities, and it is because he is seizing these powers under this legislation that the House, which is supposed to be the safeguard of democracy, must itself exercise the most careful scrutiny.
  This measure is not the same as the education legislation. It is very different, and I hope that the Secretary of State will not tell the House that he is simply going to parade a list of local authorities, a list of percentage rate increases and a list of percentages above grant-related expenditure, and that will be it.
  The impact of the legislation on each of the individual local authorities affected will be different in every case. The right hon. Gentleman must take that into consideration in his scrutiny and in what he is doing, and the House must take it into consideration in its scrutiny of what is being done.
  Mr. Cowans: This debate is the result of what happens when Governments put guillotines on. Here we have 11 amendments together. It is worse than the amendments we are talking about, because we are talking about individual authorities in this democratic place. I quarrel with my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) on one point. This used to be the place where democracy was and could be debated. After this Bill, that will be a thing of the past.
  I have never in all my life heard a more naive speech than that made by the hon. Member for Leeds, North-West. It was as if Governments of any colour did not in fact examine local authority budgets now. Has he never heard of targets, clawbacks, holdbacks, permitted expenditure levels? Could I welcome him to the real world, because it is going on now?
  Mr. Hampson rose——
  Mr. Cowans: I have not finished with you yet.
  Mr. Deputy Speaker: I hope that the hon. Gentleman does not mean that he has not finished with me.
  Mr. Cowans: I would never finish with you, Mr. Deputy Speaker. I have not finished yet with the hon. Member for Leeds, North-West. I hope that that clarifies the situation.
  The hon. Gentleman spoke as if the two things we are asking for in this amendment did not happen already. He intervened in the speech of his hon. Friend the Member for
  242
  Devises (Mr. Morrison) and proved conclusively that he did not know what the hon. Gentleman was talking about and did not even understand what his hon. Friend was trying to move.
  Dr. Hampson: I understand very well that we have holdback, targets and, before that, clawback, of which we still have a variation. Under the old situation before block grant we used to claw back from local authorities mid-year to pay the extra, because it was pro-rata: the more they spent the more that they got. My point was that it was not debated on the Floor of the House. Why should the hon. Gentleman believe that the details should not be debated on the Floor of the House?
  Mr. Cowans: The right hon. Gentleman said that we used to have. I will bring him back into the real world. We still have all these things and they are over and above this. Why did they not get debated on the Floor of the House? Because that was the Government exercising their right over the amount of money they gave to local authorities, and that was quite in order. All Governments did it. The difference now is that local authorities are not going to be allowed to raise the wherewithal from the local community. Why should it not be debated on the Floor of the House? The right hon. Gentleman said it would be too cumbersome, there would be too many authorities, and he put figures on it. But I have sat in the Committee for a long time and the Secretary of State has not addressed me. He has turned to the legions behind him and told them not to worry because he will never have to exercise part 2. He said—and that is on record—that there would be only about 10 authorities. Then halfway through the Committee stage he changed it to 20 and at the end of the Committee we got to 33.
  I submit that it is not beyond the powers of the House to debate 33 local authorities. Who places the local authorities in different categories? It is the same man who does everything else under the Bill—The Secretary of State. The fact that Nelson slept in a hammock does not make it right for us to sleep in bunks. We should move forward.
  We should deprecate legislation pushed through the House that takes away power from locally-elected representatives. The Secretary of State should not make orders ad nauseam without the principles being debated.
  The hon. Member for Southwark and Bermondsey (Mr. Hughes) should communicate with his hon. Friends who served on the Committee. What he advocated in 20 minutes, we advocated for 25 weeks. We tried to persuade the Government to outline the criteria, but they did not do so because they do not know what they are. That is another reason why each authority should be debated by the House.
  Hon. Members, including Conservative Members, have been sent here by the people to look after their interests. We should not pass legislation that does not spell out the principles and the criteria. The hon. Member for Leeds, North-West is quite happy that those should not appear in the legislation, but be left to the Secretary of State. He may be happy, but I am not and nor are those who sent me here. We want to argue the principles and take decisions in a democracy. The hon. Member for Leeds, North-West is advocating the taking away of democracy.
  I cannot look in a crystal ball and see what the Secretary of State will decide. Will the right hon. Gentleman tell us

  243
  whether a local authority that, on the Government's criteria, is part of a partnership because it is a deprived area, will be put in the same category as a local authority that does not qualify for partnerhsip? There are not many special development areas left because of the Government's policies, but will those remaining be put in the same category as a local authority that does not qualify for that status?
  The Government are being remarkably foolish. They recognise through partnership and special development status that certain areas are special cases. Yet when such a local authority if fined for overspending its GRE, the Government give it money from another pocket because it holds a special status as a deprived area. Would it not make more sense if the Government recognised that it was a special case and allowed it to spend what the community wanted it to spend? That is the difference between myself and the hon. Member for Leeds, North-West.
  I warn every right hon. and hon. Member in the Chamber — and those who are not — that the trend throughout this Parliament is to give to the Executive more and more power that we should be exercising. that is what the amendment is about. Wherever we read that the Secretary of State will make an order, we should rephrase it to read, "Whitehall civil servants will make the order". No Secretary of State worth his salt, with all his onerous duties, can do all that himself. The Secretary of State is shaking his head. Of course, I accept that he will oversee the process and be responsible for it. Right hon. and hon. Members are giving away their right to challenge the Executive at the point of first contact.
  If the amendment is not carried, the House will be faced —if it is lucky—with a one and a half hour debate that might encompass 33 diverse local authorities. One does not have to be a Bachelor of Science to work out that if there are 33 local authorities and at least 33 Members of Parliament who want to debate that issue, 33 into one and a half hours does not go. Again, we are passing to the Executive the rights that people put us here to use.
  Even if right hon. and hon. Members do not totally agree with this amendment, they should remember that they are giving their rights away. If we now have a good Secretary of State—and I am sure that we have; I said that without being solicited to do so—what about the next one, or the one after that, or the one in 100 years' time. Right hon. and hon. Members should not give this power away, and they should agree to this amendment.
  11 pm
  Mr. Patrick Jenkin: I must take up a point that was made by the hon. Member for Tyne Bridge (Mr. Cowans) and a number of hon. Members, including my hon. Friend the Member for Devizes (Mr. Morrison), saying that the decisions taken under the Bill would be taken by civil servants, and that Ministers would only be rubberstammps. I refute that strongly. In the Department of the Environment we have to deal with many local authorities. In the course of a year, I and my hon. Friends probably receive hundreds of delegations from local authorities all over the country. We concern ourselves in considerable detail with the cases put by local authorities about why they consider that the targets are unfair, or that the rate support grant distribution has not worked, or that the housing investment programme has not been appropriate. These matters are considered in great detail by Ministers.
  244
  I want to pay tribute to the junior Ministers in my Department, who carry so much of the burden of that work.
  It is not fair to civil servants to say that they carry the responsibility. Of course, their advice and the detailed work that they do is invaluable to Ministers. We could not carry out our functions without them. However, I want to put it firmly on the record that the major decisions—and, undoubtedly, major decisions will be taken under this part of the Bill—will be taken by Ministers, with as full an appreciation of the facts and the arguments as we can make. I hope that right hon. and hon. Members on both sides of the House will accept that.
  A number of hon. Members have made Second Reading speeches. I do not say that in an unkind sense. Sometimes a Report debate is none the worse for that. I shall resist the temptation to read out to the hon. Member for Norwood (Mr. Fraser) the list of absurd excesses in the expenditure of the Lambeth borough council, to which I pay my rates. We all understand that an area such as Lambeth has social problems. We are well aware of that, and that is why Lambeth is one of only two partnership authorities in London. However, one would go into that partnership with considerably more enthusiasm if one did not see the local authority squandering money as if it were water on any manner of nonsense—peace officers, creches, and so on. It has established two separate crèches—one for the children of Labour councillors, and the other for the one Tory child. It is quite absurd.
  Mr. John Fraser rose——
  Mr. Jenkin: No, I shall not give way. I want to come to the amendments.
  Mr. Fraser: Some Conservative Members think that a creche is an accident in Knightsbridge. Why will not the right hon. Gentleman defer to the judgment of the voters of Lambeth, who last week put the Tory party very much at the bottom of the poll in the council by-election?
  Mr. Jenkin: I had not heard the one about the accident in Knightsbridge. However, I was brought up to believe, like the people of Morningside, that sex was what one carried coal in.
  We have been debating an important group of amendments which provide for the Secretary of State's decisions at each stage of the rate limitation process to be set out separately for each authority and for each decision to be subject to more rigorous parliamentary procedures. I understand the motivation that prompts these amendments and, as there are four groups of amendments, I will deal with each in turn.
  The first four amendments seek to provide for separate reports to the House on the principles used in designating each authority selected for rate limitation. As clause 2 is drafted, it requires the reports laid before the House to set out the authorities designated in the report and a statement of the principles in accordance with which the designations have been made.
  Here I take up a point made by the hon. Member for Southwark and Bermondsey (Mr. Hughes). Incidentally, I was not aware that Bermondsey was a local authority —I may be a little out of date; perhaps UDI has been declared—because I thought that it was Southwark. He said that we would lump together all the local authorities, and he mentioned Bodmin and Bermondsey.

  245
  If he studies the Bill he will recognise that the principles used must be common to all authorities of the same class, and by "class" — I might tell my hon. Friend the Member for Teignbridge (Mr. Nicholls)— I mean the classes set out in clause 2(5), metropolitan counties, non-metropolitan counties and so on. There would not, of course, be a separate class of partnership or programme authorities; that would not be appropriate. We would expect the principles usually to be the same for all authorities, or at least the same for the same class. It is difficult to see what could be put into separate reports that could not as easily be put into one report. This group of amendments is over-egging the pudding considerably.
  Mr. Simon Hughes rose——
  Mr. Jenkin: I will not give way because I want to develop the argument.
  It is clear that the purpose of the clause as drafted is to require the Secretary of State to set out formally the principles that he has used in exercising his statutory discretion. He is, of course, accountable for the decisions that he takes. The information given in the report will provide the basis on which, even though the report is not subject to a formal procedure, it can be questioned. That can be done by way of parliamentary question, by an investigation of the relevant Select Committee or by the other procedures that are open to Members of the House.
  In exercising his discretion, the Secretary of State is required to act "reasonably" in the legal sense, and he could be taken to court if he failed to do so. I was recently taken to court by the London borough of Hackney, and the court decided in my favour. [Interruption.] The GLC has lost a case against the London borough of Bromley. I cannot see how separate reports would in any way facilitate matters.
  Mr. Straw indicated assent.
  Mr. Jenkin: I get the impression that the hon. Member for Blackburn (Mr. Straw) is conceding that point from a sedentary position.
  Mr. Straw: If the right hon. Gentleman had been listening to my earlier speech he would have heard me concede it from the Dispatch Box. We shall be voting on amendment 6 only because, for procedural reasons connected with the guillotine, we cannot vote on the amendment on which we wanted to vote.
  Mr. Jenkin: I understand that. I do not believe that separate reports based on the designation report would be right.
  Amendment 8 stands on its own. By deleting subsection (7), it would make it impossible to have separate reports for authorities in England and Wales, and I do not believe that hon. Members who represent Welsh constituencies would welcome that; if the Opposition vote on that, I trust that those hon. Members will be with us in the Lobby.
  The next sub-group seeks to require that at each stage —designation, and the setting of expenditure levels and rate limits — the Secretary of State's decisions are subject to approval by an affirmative resolution in both Houses of Parliament. We have never doubted the importance of involving Parliament appropriately in the procedures under the Bill, but we are talking about a matter of taxation, and in the past it has not been
  246
  considered appropriate for details of local rating to be brought before the other place. Confirmation of that view may be found in the fact that the rate support grant reports, which dispose of very large Exchequer sums to local authorities, do not go to the other place, and are subject only to approval by this House. It would seem very inappropriate to require the specific matters in clause 2 to go to the other place.
  Amendment No. 30 seeks to have the expenditure levels set under clause 3 subject to this detailed approval. It does not seem to us appropriate to seek the approval of the House at that stage for those numbers. It is open to the authorities to come back to seek redeterminations of expenditure levels in the light of their particular circumstances. In a sense the first setting of an expenditure level might be seen as an opening bid. It may be perfectly acceptable to the authority, which might rest there. On the other hand, it is more likely to want to come back and seek a derogation. It would be otiose to involve Parliament in a discussion at that stage when the details may all be changed during the course of negotiation. Of course, the final order setting the rate limit must come before the House of Commons, and that is already in the Bill.
  Furthermore, a requirement for parliamentary debate raises substantial practical problems of timetabling. That point applies equally to amendment No. 29 and the designation of authorities for selective rate limitation. The hon. Member for Blackburn acknowledged that in the last debate I said that I saw some advantage in making provision for some form of involvement of the House as regards the selection principles. I had to be cautious, as I am sure that the hon. Gentleman recognises, because I was concerned about the practical implications of any such procedure. In a normal year there will be a very tight timetable between May and July in setting and publishing the selections. The budgets for the year in which selection takes place and expenditure levels are set are not usually available to the Department of the Environment in their final form until May. The designation and expenditure level decisions will need careful consideration. Yet everyone — and this point has been made frequently today—has stressed the need for giving authorities early warning of what is required of them. My hon. Friend the Member for Leeds, North-West (Dr. Hampson) made that point very strongly from his experience with the Department.
  That is certainly the Government's view. We would want to make our views and decisions known well before the summer holidays, if that is at all practicable. If we are to achieve that, the addition of a statutory parliamentary debate could make the programme very difficult. I really wonder whether that would be a feasible procedure. It certainly would not work this year, when the whole process will have to start later, as the Bill will not reach the statute book until well into the summer.
  Amendment No. 29, as it stands, is not technically adequate. It would also include the other place in the procedure and that, I think, would be wrong. I have already said that it would not be appropriate for the other place to discuss rating matters, as the RSG is not discussed there. I am also doubtful as to whether the affirmative resolution procedure would be right, as that too would add to the difficulties of the timetable. However, I hope that my hon. Friends and the hon. Member for Blackburn will accept that I should like to look further at the possibilities,

  247
  without commitment, to see whether some solution that would involve the House with the designation of the principles, can be found. I say that in good faith.
  Amendments Nos. 14, 28 and 35 would restrict the rate limit setting orders under clause 4 to only one authority. I am well aware of the interest in the coverage of reports and orders under the Bill and the fears that there might be inadequate discussion if the composite reports and orders were taken as we envisaged. We had much discussion of this matter in Committee. We took the view that the Opposition have never been averse to the use of such composite powers in legislation for which they were responsible. My hon. Friend the Under-Secretary of State mentioned the Housing Rents and Subsidies Act 1975 and the Community Land Act 1975. Some of us remember the remarkable proposal made by Lord Glenamara, who suggested that all of our legislation should be done under general enabling Acts. The fact that that proposal was made by a former Labour Leader of the House casts some doubt on Labour's commitment to the concept of parliamentary debate.
  The rate support grant orders and the various supplementary reports which cover the full range of local authorities have traditionally been debated together in one order in a debate that lasts the whole day. I repeat the assurance that there will be adequate time for debate. I find it difficult to envisage circumstances in which it would not be appropriate for an order that covers designation and rate limiting to have a full day, but that must be a matter for discussion through the usual channels. There is no question of the Government trying to rush such a debate in one and a half hours up to 11.30 pm. Of course we shall examine authorities' individual circumstances when considering applications for redetermination, but we must take those decisions on a basis that is consistent for all authorities.
  It is important that the House ensures that there is consistency between local authorities and the levels that take account of their circumstances. It would be perfectly proper for the House to exercise its supervisory role over Ministers rather than try to substitute judgments for those of Ministers and those who advise us. I do not believe that a composite order would prevent proper discussion. That has not been my limited experience of rate support grant orders. My recollection is that we had an effective debate last January. The same would be the case for a rate setting order under the Bill.
  The fears that my hon. Friends and other have expressed are misplaced. The procedures, with the undertaking that I have given to look, without commitment, at the possibility of some form of procedure involving the House in the designation of principles will, I hope, enable the House to feel able to reject the amendment.
  Mr. Charles Morrison: I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Amendment proposed, No. 6, in page 2, line 23, after `report', insert 'or reports'.—[Mr. Straw.]
  Question put, That the amendment be made:—
  The House divided: Ayes 193, Noes 300.

  Divlsion No. 208]

  [11.20 pm

  AYES

  Adams, Allen (Paisley N)

  Anderson, Donald

  Alton, David

  Archer, Rt Hon Peter

  Ashdown, Paddy

  Harrison, Rt Hon Walter

  Ashley, Rt Hon Jack

  Hart, Rt Hon Dame Judith

  Atkinson, N. (Tottenham)

  Heffer, Eric S.

  Bagier, Gordon A. T.

  Hogg, N. (Cnauld & Kilsyth)

  Banks, Tony (Newham NW)

  Holland, Stuart (Vauxhall)

  Barnett, Guy

  Home Robertson, John

  Barron, Kevin

  Howells, Geraint

  Beckett, Mrs Margaret

  Hoyle, Douglas

  Beggs, Roy

  Hughes, Dr. Mark (Durham)

  Beith, A. J.

  Hughes, Robert (Aberdeen N)

  Bell, Stuart

  Hughes, Roy (Newport East)

  Benn, Tony

  Hughes, Sean (Knowsley S)

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

  Hughes, Simon (Southwark)

  Bermingham, Gerald

  Janner, Hon Greville

  Blair, Anthony

  Jenkins, Rt Hon Roy (Hillh'd)

  Boothroyd, Miss Betty

  John, Brynmor

  Boyes, Roland

  Johnston, Russell

  Bray, Dr Jeremy

  Jones, Barry (Alyn & Deeside)

  Brown, Gordon (D'f'mline E)

  Kaufman, Rt Hon Gerald

  Brown, Hugh D. (Provan)

  Kennedy, Charles

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

  Kirkwood, Archibald

  Brown, Ron (E'burgh, Leith)

  Lambie, David

  Bruce, Malcolm

  Lamond, James

  Callaghan, Jim (Heyw'd & M)

  Lewis, Ron (Carlisle)

  Campbell-Savours, Dale

  Lewis, Terence (Worsley)

  Canavan, Dennis

  Litherland, Robert

  Carlile, Alexander (Montg'y)

  Lloyd, Tony (Stretford)

  Carter-Jones, Lewis

  McCartney, Hugh

  Cartwright, John

  McDonald, Dr Oonagh

  Clark, Dr David (S Shields)

  McGuire, Michael

  Clarke, Thomas

  McKay, Allen (Penistone)

  Clay, Robert

  McKelvey, William

  Cocks, Rt Hon M. (Bristol S.)

  Mackenzie, Rt Hon Gregor

  Cohen, Harry

  McNamara, Kevin

  Coleman, Donald

  McTaggart, Robert

  Concannon, Rt Hon J. D.

  McWilliam, John

  Conlan, Bernard

  Madden, Max

  Cook, Frank (Stockton North)

  Marek, Dr John

  Cook, Robin F. (Livingston)

  Marshall, David (Shettleston)

  Corbett, Robin

  Martin, Michael

  Corbyn, Jeremy

  Mason, Rt Hon Roy

  Cowans, Harry

  Maxton, John

  Craigen, J. M.

  Maynard, Miss Joan

  Crowther, Stan

  Meadowcroft, Michael

  Cunliffe, Lawrence

  Michie, William

  Cunningham, Dr John

  Mikardo, Ian

  Dalyell, Tam

  Millan, Rt Hon Bruce

  Davies, Rt Hon Denzil (L'lli)

  Miller, Dr M. S. (E Kilbride)

  Davies, Ronald (Caerphiliy)

  Mitchell, Austin (G't Grimsby)

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

  Morris, Rt Hon J. (Aberavon)

  Deakins, Eric

  Nellist, David

  Dobson, Frank

  O'Neill, Martin

  Dubs, Alfred

  Owen, Rt Hon Dr David

  Dunwoody, Hon Mrs G.

  Park, George

  Eadie, Alex

  Parry, Robert

  Eastham, Ken

  Patchett, Terry

  Ellis, Raymond

  Pavitt, Laurie

  Evans, John (St. Helens N)

  Pendry, Tom

  Ewing, Harry

  Penhaligon, David

  Fatchett, Derek

  Pike, Peter

  Faulds, Andrew

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

  Field, Frank (Birkenhead)

  Powell, Raymond (Ogmore)

  Fields, T. (L'pool Broad Gn)

  Prescott, John

  Fisher, Mark

  Radice, Giles

  Flannery, Martin

  Randall, Stuart

  Foot, Rt Hon Michael

  Redmond, M.

  Forrester, John

  Richardson, Ms Jo

  Forsythe, Clifford (S Antrim)

  Roberts, Allan (Bootle)

  Foster, Derek

  Roberts, Ernest (Hackney N)

  Foulkes, George

  Robertson, George

  Fraser, J. (Norwood)

  Robinson, G. (Coventry NW)

  Freeson, Rt Hon Reginald

  Rogers, Allan

  Freud, Clement

  Ross, Ernest (Dundee W)

  Garrett, W. E.

  Ross, Wm. (Londonderry)

  George, Bruce

  Rowlands, Ted

  Godman, Dr Norman

  Ryman, John

  Gould, Bryan

  Sedgemore, Brian

  Hamilton, James (M'well N)

  Sheerman, Barry

  Hardy, Peter

  Shore, Rt Hon Peter

  Harman, Ms Harriet

  Short, Ms Clare (Ladywood)

  Short, Mrs R.(W'hampfn NE)

  Tinn, James

  Silkin, Rt Hon J.

  Torney, Tom

  Skinner, Dennis

  Wallace, James

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

  Wardell, Gareth (Gower)

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

  Wareing, Robert

  Smyth, Rev W. M. (Belfast S)

  Weetch, Ken

  Snape, Peter

  Welsh, Michael

  Soley, Clive

  White, James

  Spearing, Nigel

  Williams, Rt Hon A.

  Steel, Rt Hon David

  Winnick, David

  Stott, Roger

  Woodall, Alec

  Strang, Gavin

  Young, David (Bolton SE)

  Straw, Jack

  Thomas, Dafydd (Merioneth)

  Tellers for the Ayes:

  Thomas, Dr R. (Carmarthen)

  Mr. Frank Haynes and Mr. Don Dixon.

  Thompson, J. (Wansbeck)

  Thorne, Stan (Preston)

  Division No. 207]

  [9.36 pm

  AYES

  Adams, Allen (Paisley N)

  Corbett, Robin

  Alton, David

  Corbyn, Jeremy

  Anderson, Donald

  Cowans, Harry

  Archer, Rt Hon Peter

  Craigen, J. M.

  Ashdown, Paddy

  Crowther, Stan

  Ashley, Rt Hon Jack

  Cunliffe, Lawrence

  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'l)

  Barron, Kevin

  Deakins, Eric

  Beaumont-Dark, Anthony

  Dixon, Donald

  Beckett, Mrs Margaret

  Dobson, Frank

  Beggs, Roy

  Dubs, Alfred

  Beith, A. J.

  Dunwoody, Hon Mrs G.

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

  Eadie, Alex

  Benyon, William

  Eastham, Ken

  Bermingham, Gerald

  Edwards, Bob (W'h'mpt'n SE)

  Bidwell, Sydney

  Ellis, Raymond

  Blair, Anthony

  Evans, John (St. Helens N)

  Boothroyd, Miss Betty

  Ewing, Harry

  Boyes, Roland

  Fatchett, Derek

  Bray, Dr Jeremy

  Faulds, Andrew

  Brown, Gordon (D'f'mline E)

  Field, Frank (Birkenhead)

  Brown, Hugh D. (Provan)

  Fields, T. (L'pool Broad Gn)

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

  Fisher, Mark

  Brown, Ron (E'burgh, Leith)

  Flannery, Martin

  Bruce, Malcolm

  Forrester, John

  Buchan, Norman

  Forsythe, Clifford (S Antrim)

  Callaghan, Jim (Heyw'd & M)

  Foster, Derek

  Campbell-Savours, Dale

  Foulkes, George

  Canavan, Dennis

  Fraser, J. (Norwood)

  Carlile, Alexander (Montg'y)

  Freud, Clement

  Carter-Jones, Lewis

  Garrett, W. E.

  Cartwright, John

  George, Bruce

  Clark, Dr David (S Shields)

  Gilmour, Rt Hon Sir Ian

  Clarke, Thomas

  Godman, Dr Norman

  Clay, Robert

  Gould, Bryan

  Cocks, Rt Hon M. (Bristol S.)

  Hamilton, James (M'well N)

  Cohen, Harry

  Hardy, Peter

  Coleman, Donald

  Harman, Ms Harriet

  Concannon, Rt Hon J. D.

  Harrison, Rt Hon Walter

  Conlan, Bernard

  Hart, Rt Hon Dame Judith

  Cook, Frank (Stockton North)

  Haynes, Frank

  Cook, Robin F. (Livingston)

  Heffer, Eric S.

  NOES

  Adley, Robert

  Brandon-Bravo, Martin

  Aitken, Jonathan

  Bright, Graham

  Alexander, Richard

  Brinton, Tim

  Ancram, Michael

  Brittan, Rt Hon Leon

  Arnold, Tom

  Brown, M. (Brigg & Cl'thpes)

  Ashby, David

  Bruinvels, Peter

  Aspinwall, Jack

  Bryan, Sir Paul

  Atkins, Robert (South Ribble)

  Buck, Sir Antony

  Atkinson, David (B'm'th E)

  Budgen, Nick

  Baker, Nicholas (N Dorset)

  Butcher, John

  Baldry, Anthony

  Butterfill, John

  Banks, Robert (Harrogate)

  Carlisle, John (N Luton)

  Bellingham, Henry

  Carlisle, Kenneth (Lincoln)

  Bendall, Vivian

  Carttiss, Michael

  Best, Keith

  Chalker, Mrs Lynda

  Bevan, David Gilroy

  Chapman, Sydney

  Biffen, Rt Hon John

  Chope, Christopher

  Biggs-Davison, Sir John

  Churchill, W. S.

  Bonsor, Sir Nicholas

  Clark, Dr Michael (Rochford)

  Bottomley, Peter

  Clark, Sir W. (Croydon S)

  Bowden, Gerald (Dulwich)

  Clarke, Rt Hon K. (Rushcliffe)

  Boyson, Dr Rhodes

  Clegg, SirWalter

  Braine, Sir Bernard

  Cockeram, Eric

  NOES

  Adley, Robert

  Dunn, Robert

  Aitken, Jonathan

  Durant, Tony

  Alexander, Richard

  Eggar, Tim

  Alison, Rt Hon Michael

  Emery, Sir Peter

  Amery, Rt Hon Julian

  Evennett, David

  Ancram, Michael

  Eyre, Sir Reginald

  Arnold, Tom

  Fallon, Michael

  Ashby, David

  Farr, John

  Aspinwall, Jack

  Favell, Anthony

  Atkins, Robert (South Ribble)

  Fenner, Mrs Peggy

  Atkinson, David (B'm'th E)

  Finsberg, Sir Geoffrey

  Baker, Nicholas (N Dorset)

  Fletcher, Alexander

  Baldry, Anthony

  Fookes, Miss Janet

  Banks, Robert (Harrogate)

  Forman, Nigel

  Bellingham, Henry

  Forsyth, Michael (Stirling)

  Bendall, Vivian

  Fowler, Rt Hon Norman

  Bennett, Sir Frederic (T'bay)

  Fox, Marcus

  Best, Keith

  Fraser, Peter (Angus East)

  Bevan, David Gilroy

  Freeman, Roger

  Biffen, Rt Hon John

  Fry, Peter

  Biggs-Davison, Sir John

  Gale, Roger

  Bonsor, Sir Nicholas

  Galley, Roy

  Bottomley, Peter

  Gardiner, George (Reigate)

  Bowden, Gerald (Dulwich)

  Gardner, Sir Edward (Fylde)

  Boyson, Dr Rhodes

  Garel-Jones, Tristan

  Braine, Sir Bernard

  Glyn, Dr Alan

  Brandon-Bravo, Martin

  Goodhart, Sir Philip

  Bright, Graham

  Goodlad, Alastair

  Brinton, Tim

  Gorst, John

  Brittan, Rt Hon Leon

  Gow, Ian

  Brown, M. (Brigg & Cl'thpes)

  Gower, Sir Raymond

  Browne, John

  Grant, Sir Anthony

  Bruinvels, Peter

  Greenway, Harry

  Bryan, Sir Paul

  Gregory, Conal

  Buck, Sir Antony

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

  Budgen, Nick

  Griffiths, Peter (Portsm'th N)

  Burt, Alistair

  Grist, Ian

  Butcher, John

  Ground, Patrick

  Butterfill, John

  Grylls, Michael

  Carlisle, Kenneth (Lincoln)

  Gummer, John Selwyn

  Carttiss, Michael

  Hamilton, Neil (Tatton)

  Chalker, Mrs Lynda

  Hampson, Dr Keith

  Chapman, Sydney

  Hanley, Jeremy

  Chope, Christopher

  Hannam, John

  Churchill, W. S.

  Harvey, Robert

  Clark, Dr Michael (Rochford)

  Haselhurst, Alan

  Clark, Sir W. (Croydon S)

  Havers, Rt Hon Sir Michael

  Clarke, Rt Hon K. (Rushcliffe)

  Hawkins, Sir Paul (SW N'folk)

  Clegg, Sir Walter

  Hawksley, Warren

  Cockeram, Eric

  Hayes, J.

  Colvin, Michael

  Hayhoe, Barney

  Cope, John

  Hayward, Robert

  Corrie, John

  Heathcoat-Amory, David

  Couchman, James

  Heddle, John

  Cranborne, Viscount

  Henderson, Barry

  Currie, Mrs Edwina

  Hickmet, Richard

  Dicks, Terry

  Higgins, Rt Hon Terence L.

  Dorrell, Stephen

  Hill, James

  Douglas-Hamilton, Lord J.

  Hind, Kenneth

  Dover, Den

  Hirst, Michael

  du Cann, Rt Hon Edward

  Holland, Sir Philip (Gedling)

  Holt, Richard

  Osborn, Sir John

  Hooson, Tom

  Ottaway, Richard

  Hordern, Peter

  Page, John (Harrow W)

  Howard, Michael

  Page, Richard (Herts SW)

  Howarth, Gerald (Cannock)

  Parris, Matthew

  Howell, Rt Hon D. (G'ldford)

  Patten, John (Oxford)

  Howell, Ralph (N Norfolk)

  Pattie, Geoffrey

  Hubbard-Miles, Peter

  Pawsey, James

  Hunt, David (Wirral)

  Peacock, Mrs Elizabeth

  Hunt, John (Ravensbourne)

  Pink, R. Bonner

  Hunter, Andrew

  Pollock, Alexander

  Hurd, Rt Hon Douglas

  Porter, Barry

  Irving, Charles

  Powell, William (Corby)

  Jenkin, Rt Hon Patrick

  Powley, John

  Jessel, Toby

  Proctor, K. Harvey

  Johnson-Smith, Sir Geoffrey

  Rathbone, Tim

  Jones, Gwilym (Cardiff N)

  Rees, Rt Hon Peter (Dover)

  Jones, Robert (W Herts)

  Renton, Tim

  Joseph, Rt Hon Sir Keith

  Rhodes James, Robert

  Kershaw, Sir Anthony

  Ridley, Rt Hon Nicholas

  King, Roger (B'ham N'field)

  Ridsdale, Sir Julian

  King, Rt Hon Tom

  Rifkind, Malcolm

  Knight, Gregory (Derby N)

  Roberts, Wyn (Conwy)

  Knight, Mrs Jill (Edgbaston)

  Robinson, Mark (N'port W)

  Knowles, Michael

  Roe, Mrs Marion

  Lamont, Norman

  Rossi, Sir Hugh

  Lang, Ian

  Rost, Peter

  Latham, Michael

  Rowe, Andrew

  Lawler, Geoffrey

  Rumbold, Mrs Angela

  Lawrence, Ivan

  Ryder, Richard

  Lawson, Rt Hon Nigel

  Sackville, Hon Thomas

  Leigh, Edward (Gainsbor'gh)

  Sainsbury, Hon Timothy

  Lennox-Boyd, Hon Mark

  St. John-Stevas, Rt Hon N.

  Lester, Jim

  Sayeed, Jonathan

  Lilley, Peter

  Shaw, Sir Michael (Scarb')

  Lloyd, Ian (Havant)

  Shelton, William (Streatham)

  Lloyd, Peter, (Fareham)

  Shepherd, Colin (Hereford)

  Lord, Michael

  Shepherd, Richard (Aldridge)

  Lyell, Nicholas

  Silvester, Fred

  McCrindle, Robert

  Sims, Roger

  McCurley, Mrs Anna

  Skeet, T. H. H.

  Macfarlane, Neil

  Smith, Sir Dudley (Warwick)

  MacKay, Andrew (Berkshire)

  Smith, Tim (Beaconsfield)

  MacKay, John (Argyll & Bute)

  Soames, Hon Nicholas

  Maclean, David John

  Spencer, Derek

  McQuarrie, Albert

  Spicer, Michael (S Worcs)

  Major, John

  Stanbrook, Ivor

  Malins, Humfrey

  Stanley, John

  Malone, Gerald

  Steen, Anthony

  Maples, John

  Stern, Michael

  Marland, Paul

  Stevens, Lewis (Nuneaton)

  Marlow, Antony

  Stevens, Martin (Fulham)

  Maude, Hon Francis

  Stewart, Allan (Eastwood)

  Mawhinney, Dr Brian

  Stewart, Andrew (Sherwood)

  Maxwell-Hyslop, Robin

  Stewart, lan (N Hertf'dshire)

  Mayhew, Sir Patrick

  Stokes, John

  Mellor, David

  Stradling Thomas, J.

  Merchant, Piers

  Sumberg, David

  Miller, Hal (B'grove)

  Tapsell, Peter

  Mills, Iain (Meriden)

  Taylor, Teddy (S'end E)

  Mills, Sir Peter (West Devon)

  Tebbit, Rt Hon Norman

  Miscampbell, Norman

  Temple-Morris, Peter

  Mitchell, David (NW Hants)

  Terlezki, Stefan

  Moate, Roger

  Thomas, Rt Hon Peter

  Monro, Sir Hector

  Thompson, Patrick (N'ich N)

  Montgomery, Fergus

  Thornton, Malcolm

  Moore, John

  Thurnham, Peter

  Morrison, Hon P. (Chester)

  Townend, John (Bridlington)

  Moynihan, Hon C.

  Townsend, Cyril D. (B'heath)

  Mudd, David

  Tracey, Richard

  Murphy, Christopher

  Trotter, Neville

  Neale, Gerrard

  Twinn, Dr Ian

  Nelson, Anthony

  van Straubenzee, Sir W.

  Neubert, Michael

  Vaughan, Sir Gerard

  Newton, Tony

  Waddington, David

  Nicholls, Patrick

  Wakeham, Rt Hon John

  Norris, Steven

  Waldegrave, Hon William

  Onslow, Cranley

  Walker, Bill (T'side N)

  Oppenheim, Philip

  Walker, Rt Hon P. (W'cester)

  Oppenheim, Rt Hon Mrs S.

  Waller, Gary

  Walters, Dennis

  Wilkinson, John

  Ward, John

  Wolfson, Mark

  Wardle, C. (Bexhill)

  Wood, Timothy

  Warren, Kenneth

  Woodcock, Michael

  Watson, John

  Yeo, Tim

  Watts, John

  Young, Sir George (Acton)

  Wells, Bowen (Hertford)

  Younger, Rt Hon George

  Wells, John (Maidstone)

  Wheeler, John

  Tellers for the Noes:

  Whitfield, John

  Mr. Carol Mather and Mr. Robert Boscawen.

  Whitney, Raymond

  Question accordingly negatived.

Clause 4

  DETERMINATION OF MAXIMUM RATE OF PRECEPT
  11.30 pm
  Mr. Cartwright: I beg to move amendment No. 11, in page 4, leave out lines 35 and 36.
  The amendment is tabled to draw attention to the extremely detailed powers of interference which the Secretary of State will have if the Bill is carried in its present form. Clause 4(2) provides that when the Secretary of State is determining the maximum rate or precept to be fixed by a designated authority he
  "may take into account any financial reserves available to the authority."
  Nowhere in the Bill is there any definition of what "financial reserves" may be. In Committee the Under-Secretary was frank enough to say that the provision had been drawn in a vague way to enable the Government to draw into their net as many of those little pots of gold tucked away in squirrel holes in town halls as the Secretary of State could find. It is clear that many detailed reserves will be caught up in this provision if it is left in its present form.
  There is, for example, the general rate fund balance. I was brought up in local government to refer to that as the working balance. It tends to be built up and to be raided to raise or lower the level of the rate, a skill which anyone in local government has to learn before becoming chairman of a finance committee. The balance must have sufficient funds in it to meet emergencies and other unforeseen demands. Maintaining that balance calls for an element of judgment based on experience of local circumstances.
  Secondly, there is the housing revenue account, which is used to deal with the income and expenditure of a local authority's council housing. One needs the balance to be maintained at a sensible level to deal with the problems of management and maintenance of local authority housing and the capacity to meet unexpected problems in that housing. Again, that needs an element of judgment based on a knowledge of local circumstances.
  Thirdly, there is the repair and renewals fund, which is established to meet the costs of planned maintenance of buildings and the repair and replacement of vehicles, plant and machinery. The fund is established as a sensible and prudent piece of housekeeping. The balance of the fund depends on a judgment of the condition and serviceability of buildings, plant and similar assets.
  Lastly, there is the capital fund, which is sometimes built up by contributions from revenue and sometimes from the sale of capital assets. It is used to reduce interest
  252
  charges on existing loans or to fund capital schemes, and once again that flows from a level of local knowledge and experience.
  My objection to the provision is that the Secretary of State, without local experience, will have power to determine what is a proper and sensible level.
  The setting of prudent balances is a matter for political judgment. Some may say that it is a matter of political manipulation and others that it involves the fine tuning of the local budget. I do not believe that it is right or proper for the Secretary of State to be sucked into such extremely detailed local decisions.
  The Government said on the last amendment that it was wrong for civil servants to take all the decisions. It is difficult to believe that the Secretary of State will sit up late one night with his cup of cocoa and 25 sets of local authority accounts trying to sort out a sensible level of housing repair and maintenance in the London borough of Lambeth, for example.
  Mr. Powley: I must press the hon. Gentleman on the argument that he is developing. Perhaps he can give the House the benefit of his wisdom. What does he consider to be a prudent balance in local authority expenditure on the housing revenue account or the general rate fund account?
  Mr. Cartwright: That intervention misses my point. Only on the basis of local knowledge and experience can such a judgment be made. Even those who seek to make that judgment locally can get it wrong. When they get it wrong, the electors exert retribution. If the Secretary of State gets it wrong, he will not be subject to the will of local electors or ratepayers. We are talking about exercising a political judgment based on local knowledge and experience. I cannot believe that such a judgment can be exercised by the Secretary of State. Frankly, I do not believe that it will be exercised by the Secretary of State, although I heard what he said earlier this evening.
  In the real world, civil servants in the Department will do the job. It is unfair that civil servants should be exposed to making such difficult and sensitive decisions about proper and sensible levels of reserves in the various and detailed accounts. I cannot believe that it is good for local government for central Government to become involved in this way. This is a classic case of Whitehall getting its fingers into detailed local authority tills. That is a great mistake, and I commend the amendment to the House.
  Mr. Michael Stern: I should first declare an interest in the subject of the debate as a chartered accountant and a partner in the firm of Halpern and Woolf, chartered accountants.
  I shall address myself to the subject matter to which the amendment is related in the context that, unlike the proponent of the amendment, if anything I would castigate the Government for not going nearly far enough in the powers that they seek to take under the clause in looking at the areas of financial accounting of local authorities that are capable of what is called "creative accounting" nowadays.
  In the Bill there is no definition of the term "expenditure" that the Minister will look at in deciding on the authorities to be made the subject of action under the clause. I accept that there are difficulties in defining "expenditure", when the accounting bodies have been unable to agree on a satisfactory definition, and the

  253
  Minister would be reluctant to impose a definition on them. Because there is no definition, it is essential and inevitable that the Secretary of State should take powers to look at areas that are essential for a study of the expenditure of a particular authority.
  If the amendment were passed, it would render the Secretary of State powerless in deciding on the appropriate level of expenditure for a particular authority and whether that level of expenditure as declared by the authority bore any relation whatsoever to reality.
  I shall describe one or two of the areas where it would be possible for an authority, with or without appropriate advice, so to fudge its expenditure for the year in which it suspects it is being considered for action under the Bill that it could manipulate the figures legally to justify its dropping out from consideration by the Secretary of State. It would be able to look again at its definition of the difference between capital and revenue expenditure. That definition is extremely woolly. To do so, it could use its balances to aid it in this exercise.
  The local authority would be able to redefine the areas of expenditure that it decides to apply to areas covered by specific grant in a way that it has not done in the past. There is nothing in the Bill to stop the local authority doing so. It would be able to redefine the date on which it takes creditors into account, and doing so, legally, would have a major impact on its expenditure for the year in which it suspects it is subject to potential action. It would be able to run down its stocks of such items as stationery and consumables without any effect other than as brought in by the balances, which the amendment seeks to withdraw from consideration. It would be able to take a slightly rosier view than in the past of the value of its debtors—again, without there being any control under the Bill. Finally, it would be able to ignore, under the strict wording of the Bill, any audit qualifications that are imposed on it either by the district auditor or by the Audit Commission.
  The powers given to the Secretary of State under the clause as it stands are weak enough. The amendment would make them totally nugatory. I should like to hear from the Minister when he sums up that he considers that he has sufficient powers, under the general powers in the Bill, to be able to take action against authorities that are tempted to consider the action that I mentioned. I hope that we shall hear from the Minister that, far from accepting the amendment, he will move in the opposite direction and warn local authorities that if there is any attempt to use creative accounting, whether through the use of balances or any other means I mentioned, the Secretary of State will be able to negate that use of accounting by which local authorities might escape from the effects of the Bill.
  Mr. Cowans: I welcome the hon. Member for Bristol, North-West (Mr. Stern) to the debate. He did not attend debates on the other controversial, constitutional issues, but at least he is here for this debate.
  The Bill refers to "financial reserves". Nowhere does it define what "financial reserves" are. The hon. Gentleman portrayed all local government as a bunch of twisters. I do not believe that for one moment. It would have been better if the hon. Gentleman had said that the Government should define clearly what "financial reserves" are. I have news for him. There is no definition of "financial reserves" in any other statute introduced by
  254
  the Conservative Government or the Labour Government. Local authorities are not a bunch of twisters. They work very hard and do not seek to twist the books, contrary to what the hon. Member for Bristol, North-West said. They are very prudent.
  11.45 pm
  It is prudent that a local authority should build up a reserve of many items. A local authority, led by its financial officer, looks ahead and builds up a reserve to cover, for example, pay awards and the cost of inflation, which, like the Oxford boat crew, goes up and down. If the local authorities have a financial reserve, they may not be caught by inflation.
  The Bill is supposed to be about incentives. Conservative Members have frequently talked about "prudent", "safeguarding" authorities which are "looking after the ratepayers' interests" and are "not profligate spenders". Those local authorities are, however, penalised as soon as they seek to look after their reserves to take account of what happens in the real world. If Conservative Members are honest in their intentions, what is the incentive for any local authority to be prudent? A prudent local authority will build up a financial reserve against a rainy day. After the Bill is passed, all days will be rainy, so there will be a greater need for a financial reserve.
  Many of the elements necessary to achieve a good financial reserve, such as interest rates—Conservative Members should know all about that—do not lie within the control of local authorities. Why penalise a local authority, which over the years has garnered, prudently obtained value for money, husbanded its money and built up a financial reserve? What big business, which Conservative Members are supposed to represent, does not have a financial reserve, look towards the future and put something by for a rainy day? Is big business penalised for doing that? According to the Conservatives' own rules, why penalise a local authority for doing what is all right for the barons of industry?
  The Under-Secretary of State should clearly define financial reserves and tell local authorities, "It is good management and housekeeping if you save for a rainy day, and we shall not penalise you," or reject completely the argument that financial reserves will be penalised. Perhaps next year there will be a Bill to penalise all the businesses that are prudent, build up financial reserves and save for a rainy day. There may be some justice in the hon. Gentleman doing that. If he does not do it, there will be no justice.
  Mr. Waldegrave: The speech of the hon. Member for Tyne Bridge (Mr. Cowans) reminded us of many happy hours in Committee. I can explain why my hon. Friend the Member for Bristol, North-West (Mr. Stern) is so sensitive about these matters. His reason is the same as mine. He has avidly been studying what has been happening in the county of Avon. He may share, for slightly different reasons, the embarrassment of some council officers at the crowing by some of the politicians in the Avon Labour group over their cleverness with the reserves. Of course, they have not been very clever. In the end they will be caught out. They have merely put off the evil hour. That is what caused my hon. Friend's worries, and I sympathise with him.
  It also enables me to make a point to some of my hon. Friends who dislike the Bill that there are pressures from some members of the Conservative party who say that the

  255
  powers that we are giving ourselves are only just enough to deal with the abuses that we face. They want to be sure that we are giving ourselves sufficient powers.
  One reason why we need powers over reserves is that a number of my right hon. and hon. Friends wrote to my right hon. Friend and myself when we introduced the Bill and told us to watch out because local authorities would rate up in the year before the Bill was enacted and would then use their reserves to avoid the Bill's impact. I am glad to say that the message has got across and I do not think that that has happened, because we have seen low rate increases this year.
  Mr. Richard Holt: Some of the local authorities that my hon. Friend has mentioned have taken note, but Cleveland county council has increased its precept this year by 20 per cent.
  Mr. Waldegrave: I am sorry to hear that. My hon. Friend the Member for Bristol, North-West is right. The powers in the Bill are necessary to make a real linkage between the expenditure level and the rate. If there were no such powers, all manner of weaknesses would be introduced into the linkage.
  I hope that I can console the hon. Member for Tyne Bridge. I spent many hours trying to do so in Committee, but not always with complete success. One of the other reasons for having the powers over the reserves is to meet the point that he makes. We do not wish to preclude the authorities that may be rate-capped from being in the position of those admirable barons of industry to whom the hon. Member referred. That might be a reference to the owner of Oxford United football club or someone of that kind. The local authorities must have proper reserves, and it is essential that the Secretary of State, when setting the expenditure limit for a rate-capped authority, should be able to make provision for proper reserves. He would not be able to do that without the proposed powers over reserves.
  The matter works both ways. The Secretary of State must ensure that there is no what the hon. Member for Tyne Bridge toughly referred to as "twisting" and also that there is a prudent level of reserves.
  Mr. Cowans: I see that, but the proper person to take that decision is the financial officer of the local authority.The Government are superseding that financial officer and taking over. The Minister has just said that he does not believe that he has sufficient powers. Are we already seeing the draft of the 1985 Bill?
  Mr. Waldegrave: I was hoping to persuade my hon. Friend the Member for Bristol, North West that we have sufficient powers. I cannot deny that the Bill takes powers over local authorities. The hon. Member for Tyne Bridge discussed that matter for some hours, and I am not going to try to deny it now. It is an essential part of the Bill. We must argue that it is plainly necessary——
  Sir Geoffrey Finsberg: May I ask my hon. Friend not to agree too much with the hon. Member for Tyne Bridge (Mr. Cowans), because I thought that the oldest maxim in local government was to let the ratepayers' money fructify in their pockets and not in local authorities' large and ever-increasing prudent balances?
  Mr. Waldegrave: My hon. Friend is entirely right. I think that the number of occasions when he will find that
  256
  the reserves in a rate-capping authority are too low will be outnumbered by the number of occasions when it can return to the ratepayers money that should rightfully be back in their pockets.
  We talk all the time as though they were local authority reserves. They are no such thing. Ratepayers' money which should be returned to them is sitting in bank balances.
  It is essential to have the powers. The attempt to knock them out, which I thought was one of the weaker amendments to which the Committee had to listen, remains one of the weaker amendments when it comes before the House. I have no hesitation in asking my right hon. and hon. Friends to reject the amendment.
  Dr. Cunningham: I listened with some amusement to the contribution of the hon. Member for Bristol, North-West (Mr. Stern), who described himself as an accountant. If it has taken the introduction of the Bill to make him aware of the various facets of creative accountancy in the City and elsewhere as well as in local government, do not know what he has been doing in his profession in the past few years.
  The hon. Member made a sanctimonious speech about the situation in local government, but I do not believe for a moment that Conservative Members believe that it is better for local authority balances to be controlled by the Secretary of State or his officials in Whitehall than by the authority's finance committee and director of finance., because in most, if not all, cases the Secretary of State and his officials will have no real knowledge or understanding of the situation in that authority.
  Far from this part of the Bill being a safeguard for ratepayers and local authority services, it is the reverse. It shows that there are no lengths to which the Government will not go to take absolute control over the budgets of local government even down to the balances and reserves and to remove flexibility and room for manoeuvre from the attempts of local councils and their directors of finance to mitigate the worst aspects of the cuts in rate support grant and the other financial penalties imposed on them by the Government.
  It is monstrous for the Under-Secretary of State, the author of a famous book about the powers of Ministers accruing more and more to the centre of Government and Whitehall, to say that even in the marginal case of local government balances and reserves Ministers should have the last word and the power to dictate the fate and use of those balances. We reject his arguments not just as doctrinaire and contrary to his own views but as fatuous and impracticable. We shall therefore support the amendment moved by the hon. Member for Woolwich (Mr. Cartwright).
  Question put, That the amendment be made:—
  The House divided: Ayes 180, Noes 297.

  Division No. 209]

  [11.57 p.m.

  AYES

  Adams, Allen (Paisley N)

  Barron, Kevin

  Alton, David

  Beckett, Mrs Margaret

  Anderson, Donald

  Beith, A. J.

  Archer, Rt Hon Peter

  Bell, Stuart

  Ashdown, Paddy

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

  Ashton, Joe

  Bermingham, Gerald

  Atkinson, N. (Tottenham)

  Blair, Anthony

  Bagier, Gordon A. T.

  Boothroyd, Miss Betty

  Banks, Tony (Newham NW)

  Boyes, Roland

  Barnett, Guy

  Bray, Dr Jeremy

  NOES

  Adley, Robert

  Forsyth, Michael (Stirling)

  Aitken, Jonathan

  Fowler, Rt Hon Norman

  Alexander, Richard

  Fox, Marcus

  Alison, Rt Hon Michael

  Fraser, Peter (Angus East)

  Amery, Rt Hon Julian

  Freeman, Roger

  Ancram, Michael

  Fry, Peter

  Arnold, Tom

  Gale, Roger

  Ashby, David

  Galley, Roy

  Aspinwall, Jack

  Gardiner, George (Reigate)

  Atkins, Robert (South Ribble)

  Gardner, Sir Edward (Fylde)

  Atkinson, David (B'm'th E)

  Garel-Jones, Tristan

  Baker, Nicholas (N Dorset)

  Glyn, Dr Alan

  Baldry, Anthony

  Goodhart, Sir Philip

  Banks, Robert (Harrogate)

  Goodlad, Alastair

  Bellingham, Henry

  Gorst, John

  Bendall, Vivian

  Gow, Ian

  Best, Keith

  Gower, Sir Raymond

  Bevan, David Gilroy

  Grant, Sir Anthony

  Biffen, Rt Hon John

  Greenway, Harry

  Biggs-Davison, Sir John

  Gregory, Conal

  Blaker, Rt Hon Sir Peter

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

  Bonsor, Sir Nicholas

  Griffiths, Peter (Portsm'th N)

  Bottomley, Peter

  Grist, Ian

  Bowden, Gerald (Dulwich)

  Ground, Patrick

  Boyson, Dr Rhodes

  Grylls, Michael

  Braine, Sir Bernard

  Gummer, John Selwyn

  Brandon-Bravo, Martin

  Hamilton, Neil (Tatton)

  Bright, Graham

  Hampson, Dr Keith

  Brinton, Tim

  Hanley, Jeremy

  Brittan, Rt Hon Leon

  Hannam, John

  Brown, M. (Brigg & Cl'thpes)

  Harvey, Robert

  Browne, John

  Haselhurst, Alan

  Bruinvels, Peter

  Havers, Rt Hon Sir Michael

  Bryan, Sir Paul

  Hawkins, Sir Paul (SW N'folk)

  Buck, Sir Antony

  Hawksley, Warren

  Budgen, Nick

  Hayes, J.

  Burt, Alistair

  Hayhoe, Barney

  Butcher, John

  Hayward, Robert

  Butterfill, John

  Heathcoat-Amory, David

  Carlisle, John (N Luton)

  Heddle, John

  Carlisle, Kenneth (Lincoln)

  Henderson, Barry

  Carttiss, Michael

  Hickmet, Richard

  Chalker, Mrs Lynda

  Higgins, Rt Hon Terence L.

  Chapman, Sydney

  Hill, James

  Chope, Christopher

  Hind, Kenneth

  Churchill, W. S.

  Hirst, Michael

  Clark, Dr Michael (Rochford)

  Holland, Sir Philip (Gedling)

  Clark, Sir W. (Croydon S)

  Holt, Richard

  Clarke, Rt Hon K. (Rushcliffe)

  Hooson, Tom

  Cockeram, Eric

  Hordern, Peter

  Colvin, Michael

  Howard, Michael

  Cope, John

  Howarth, Gerald (Cannock)

  Corrie, John

  Howell, Rt Hon D. (G'ldford)

  Couchman, James

  Howell, Ralph (N Norfolk)

  Cranborne, Viscount

  Hubbard-Miles, Peter

  Currie, Mrs Edwina

  Hunt, David (Wirral)

  Dicks, Terry

  Hunt, John (Ravensbourne)

  Dorrell, Stephen

  Hunter, Andrew

  Douglas-Hamilton, Lord J.

  Hurd, Rt Hon Douglas

  Dover, Den

  Irving, Charles

  du Cann, Rt Hon Edward

  Jenkin, Rt Hon Patrick

  Dunn, Robert

  Jessel, Toby

  Durant, Tony

  Johnson-Smith, Sir Geoffrey

  Eggar, Tim

  Jones, Gwilym (Cardiff N)

  Emery, Sir Peter

  Jones, Robert (W Herts)

  Evennett, David

  Joseph, Rt Hon Sir Keith

  Eyre, Sir Reginald

  Kershaw, Sir Anthony

  Fallon, Michael

  King, Roger (B'ham N'field)

  Farr, John

  King, Rt Hon Tom

  Favell, Anthony

  Knight, Gregory (Derby N)

  Fenner, Mrs Peggy

  Knight, Mrs Jill (Edgbaston)

  Finsberg, Sir Geoffrey

  Knowles, Michael

  Fletcher, Alexander

  Lamont, Norman

  Fookes, Miss Janet

  Lang, Ian

  Forman, Nigel

  Latham, Michael

  Brown, Gordon (D'f'mline E)

  Kirkwood, Archibald

  Brown, Hugh D. (Provan)

  Lambie, David

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

  Lamond, James

  Brown, Ron (E'burgh, Leith)

  Lewis, Ron (Carlisle)

  Bruce, Malcolm

  Lewis, Terence (Worsley)

  Callaghan, Jim (Heyw'd & M)

  Litherland, Robert

  Campbell-Savours, Dale

  Lloyd, Tony (Stretford)

  Canavan, Dennis

  McDonald, Dr Oonagh

  Carlile, Alexander (Montg'y)

  McGuire, Michael

  Carter-Jones, Lewis

  McKay, Allen (Penistone)

  Clark, Dr David (S Shields)

  McKelvey, William

  Clarke, Thomas

  Mackenzie, Rt Hon Gregor

  Clay, Robert

  McNamara, Kevin

  Cocks, Rt Hon M. (Bristol S.)

  McTaggart, Robert

  Cohen, Harry

  McWilliam, John

  Coleman, Donald

  Madden, Max

  Concannon, Rt Hon J. D.

  Marek, Dr John

  Conlan, Bernard

  Marshall, David (Shettleston)

  Cook, Frank (Stockton North)

  Martin, Michael

  Cook, Robin F. (Livingston)

  Maxton, John

  Corbett, Robin

  Maynard, Miss Joan

  Corbyn, Jeremy

  Meacher, Michael

  Cowans, Harry

  Michie, William

  Craigen, J. M.

  Mikardo, Ian

  Crowther, Stan

  Millan, Rt Hon Bruce

  Cunliffe, Lawrence

  Miller, Dr M. S. (E Kilbride)

  Cunningham, Dr John

  Mitchell, Austin (G't Grimsby)

  Davies, Rt Hon Denzil (L'lli)

  Morris, Rt Hon J. (Aberavon)

  Davies, Ronald (Caerphilly)

  Nellist, David

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

  O'Neill, Martin

  Deakins, Eric

  Park, George

  Dixon, Donald

  Parry, Robert

  Dobson, Frank

  Patchett, Terry

  Dubs, Alfred

  Pavitt, Laurie

  Dunwoody, Hon Mrs G.

  Pendry, Tom

  Eadie, Alex

  Penhaligon, David

  Eastham, Ken

  Pike, Peter

  Evans, John (St. Helens N)

  Powell, Raymond (Ogmore)

  Ewing, Harry

  Prescott, John

  Fatchett, Derek

  Radice, Giles

  Faulds, Andrew

  Randall, Stuart

  Field, Frank (Birkenhead)

  Redmond, M.

  Fields, T. (L'pool Broad Gn)

  Richardson, Ms Jo

  Fisher, Mark

  Roberts, Allan (Bootle)

  Flannery, Martin

  Roberts, Ernest (Hackney N)

  Foot, Rt Hon Michael

  Robertson, George

  Forrester, John

  Robinson, G. (Coventry NW)

  Foster, Derek

  Ross, Ernest (Dundee W)

  Foulkes, George

  Rowlands, Ted

  Fraser, J. (Norwood)

  Ryman, John

  Freeson, Rt Hon Reginald

  Sedgemore, Brian

  Freud, Clement

  Sheerman, Barry

  Garrett, W. E.

  Sheldon, Rt Hon R.

  George, Bruce

  Shore, Rt Hon Peter

  Godman, Dr Norman

  Short, Ms Clare (Ladywood)

  Gould, Bryan

  Silkin, Rt Hon J.

  Hamilton, James (M'well N)

  Skinner, Dennis

  Hardy, Peter

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

  Harman, Ms Harriet

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

  Harrison, Rt Hon Walter

  Snape, Peter

  Hart, Rt Hon Dame Judith

  Soley, Clive

  Haynes, Frank

  Steel, Rt Hon David

  Hogg, N. (C'nauld & Kilsyth)

  Stott, Roger

  Holland, Stuart (Vauxhall)

  Strang, Gavin

  Home Robertson, John

  Straw, Jack

  Howells, Geraint

  Thomas, Dafydd (Merioneth)

  Hoyle, Douglas

  Thomas, Dr R. (Carmarthen)

  Hughes, Dr. Mark (Durham)

  Thompson, J. (Wansbeck)

  Hughes, Robert (Aberdeen N)

  Thorne, Stan (Preston)

  Hughes, Roy (Newport East)

  Tinn, James

  Hughes, Sean (Knowsley S)

  Torney, Tom

  Hughes, Simon (Southwark)

  Wallace, James

  Janner, Hon Greville

  Wardell, Gareth (Gower)

  Jenkins, Rt Hon Roy (Hillh'd)

  Wareing, Robert

  John, Brynmor

  Weetch, Ken

  Johnston, Russell

  Welsh, Michael

  Jones, Barry (Alyn & Deeside)

  White, James

  Kaufman, Rt Hon Gerald

  Williams, Rt Hon A.

  Kennedy, Charles

  Winnick, David

  Woodall, Alec

  Tellers for the Ayes:

  Young, David (Bolton SE)

  Mr. John Cartwright and Mr. Michael Meadowcroft

  Lawler, Geoffrey

  Murphy, Christopher

  Lawrence, Ivan

  Neale, Gerrard

  Lawson, Rt Hon Nigel

  Nelson, Anthony

  Leigh, Edward (Gainsbor'gh)

  Neubert, Michael

  Lennox-Boyd, Hon Mark

  Newton, Tony

  Lester, Jim

  Norris, Steven

  Lilley, Peter

  Onslow, Cranley

  Lloyd, lan (Havant)

  Oppenheim, Philip

  Lloyd, Peter, (Fareham)

  Oppenheim, Rt Hon Mrs S.

  Lord, Michael

  Osborn, Sir John

  Lyell, Nicholas

  Ottaway, Richard

  McCrindle, Robert

  Page, John (Harrow W)

  McCurley, Mrs Anna

  Page, Richard (Herts SW)

  Macfarlane, Neil

  Parris, Matthew

  MacKay, Andrew (Berkshire)

  Patten, John (Oxford)

  MacKay, John (Argyll & Bute)

  Pattie, Geoffrey

  Maclean, David John

  Pawsey, James

  McQuarrie, Albert

  Peacock, Mrs Elizabeth

  Major, John

  Pink, R. Bonner

  Malins, Humfrey

  Pollock, Alexander

  Malone, Gerald

  Porter, Barry

  Maples, John

  Powell, William (Corby)

  Marland, Paul

  Powley, John

  Marlow, Antony

  Proctor, K. Harvey

  Maude, Hon Francis

  Rathbone, Tim

  Mawhinney, Dr Brian

  Rees, Rt Hon Peter (Dover)

  Maxwell-Hyslop, Robin

  Renton, Tim

  Mayhew, Sir Patrick

  Rhodes James, Robert

  Mellor, David

  Ridley, Rt Hon Nicholas

  Merchant, Piers

  Ridsdale, Sir Julian

  Miller, Hal (B'grove)

  Rifkind, Malcolm

  Mills, lain (Meriden)

  Roberts, Wyn (Conwy)

  Mills, Sir Peter (West Devon)

  Robinson, Mark (N'port W)

  Miscampbell, Norman

  Roe, Mrs Marion

  Mitchell, David (NW Hants)

  Rossi, Sir Hugh

  Moate, Roger

  Rost, Peter

  Monro, Sir Hector

  Rowe, Andrew

  Montgomery, Fergus

  Rumbold, Mrs Angela

  Moore, John

  Ryder, Richard

  Morrison, Hon P. (Chester)

  Sackville, Hon Thomas

  Moynihan, Hon C.

  Sainsbury, Hon Timothy

  Mudd, David

  St. John-Stevas, Rt Hon N.

  Sayeed, Jonathan

  Townsend, Cyril D. (B'heath)

  Shaw, Sir Michael (Scarb')

  Tracey, Richard

  Shelton, William (Streatham)

  Trotter, Neville

  Shepherd, Colin (Hereford)

  Twinn, Dr Ian

  Shepherd, Richard (Aldridge)

  van Straubenzee, Sir W.

  Silvester, Fred

  Vaughan, Sir Gerard

  Sims, Roger

  Waddington, David

  Skeet, T. H. H.

  Wakeham, Rt Hon John

  Smith, Sir Dudley (Warwick)

  Waldegrave, Hon William

  Smith, Tim (Beaconsfield)

  Walker, Bill (T'side N)

  Soames, Hon Nicholas

  Waller, Gary

  Spencer, Derek

  Walters, Dennis

  Spicer, Michael (S Worcs)

  Ward, John

  Stanbrook, Ivor

  Wardle, C. (Bexhill)

  Stanley, John

  Warren, Kenneth

  Stern, Michael

  Watson, John

  Stevens, Lewis (Nuneaton)

  Watts, John

  Stevens, Martin (Fulham)

  Wells, Bowen (Hertford)

  Stewart, Allan (Eastwood)

  Wells, John (Maidstone)

  Stewart, Andrew (Sherwood)

  Wheeler, John

  Stewart, Ian (N Hertf'dshire)

  Whitfield, John

  Stokes, John

  Whitney, Raymond

  Stradling Thomas, J.

  Wilkinson, John

  Sumberg, David

  Wolfson, Mark

  Tapsell, Peter

  Wood, Timothy

  Taylor, Teddy (S'end E)

  Woodcock, Michael

  Tebbit, Rt Hon Norman

  Yeo, Tim

  Temple-Morris, Peter

  Young, Sir George (Acton)

  Terlezki, Stefan

  Younger, Rt Hon George

  Thomas, Rt Hon Peter

  Thompson, Patrick (N'ich N)

  Tellers for the Noes:

  Thornton, Malcolm

  Mr. Carol Mather and Mr. Robert Boscawen.

  Thurnham, Peter

  Townend, John (Bridlington)

  Question accordingly negatived.
  It being after Twelve o'clock, further consideration of the Bill adjourned, pursuant to order [29 February].
  Bill, as amended (in the Standing Committee), to be further considered this day.

  Public Records (Commission for the New Towns)
  Motion made and Question proposed,
  That the draft Public Records (Commission for the New Towns) Order 1984, which was laid before this House on 5th March, be approved.—[The Solicitor-General.]
  12.9 am
  Mr. Christopher Murphy: I rise briefly to support this order, because I believe it to be both right and desirable that new town records should be placed in the public domain. Clearly such documents have intrinsic value for research into the growth of the new towns themselves, and their social and economic impact on the surrounding areas provides insight into town planning methods and traces the evolution of post-war approaches to such urban problems as congestion and overcrowding.
  The new towns movement has ever been the source of controversy. For some, they remain the idealism to achieve social planning; for others, they have become the reality for a better life style.
  My constituency has two such new towns, Welwyn Garden City and Hatfield, and the release of these records will do much to show the successes or otherwise of these examples of the new town concept. Indeed, my constituents in a number of cases came from the very opposite environment, that of urban decay in areas such as the east end of London, and in Bethnal Green and Bow in the two 1974 general elections I had the opportunity to meet many of them before seeing them again in Hertfordshire.
  The purpose of Hatfield was to serve the nearby aircraft industry, diversifying employment and taking "overspill" from London. The purpose of Welwyn Garden City was also to provide such overspill facilities, but this time it was attached to the existing private enterprise creation of Ebenezer Howard. Both have been brought together under one local government authority, as have the surrounding villages and countryside, to provide a mixed urban and rural community in mid-Hertfordshire.
  By invoking the Public Records, Act with regard to these documents, many of the aspects of these two new towns will be permitted fresh analysis. Such information will do much to ensure that future developments can learn from the lessons of the past.
  There can be little doubt that new towns such as Welwyn Garden City and Hatfield have given a far better quality of life to many families, albeit at the expense of the countryside and to the detriment of inner cities. However, the overriding concerns must be for the welfare and benefit of those people who have come to live in the district. The records will help to explain the imbalance in facilities for differing age groups—an emphasis on the young and their education, and a neglect for the ageing population. Now there are the agonies of adjusting the provision of schools to falling rolls and the difficulties of finding sufficient accommodation for the elderly sick.
  262
  The records will help to explain the imbalance in the housing stock between rented and private accommodation and in terms of commercial buildings and shops. Now the right to buy is a welcome step in overcoming the serious shortage of homes to purchase, as is the sale of commission assets to increase local ownership and generate redevelopment.
  The records will help to explain the imbalance in travel opportunities for commuters and local workers alike. Now the need to improve the A l(M), to provide the train system to and from London with better services and station accommodation, and to restructure the bus timetable have all become necessities but with the seemingly inevitable accompanying difficulties.
  The records will also point to the attraction of new technology industries, of pharmaceutical companies, and spin-off enterprise from aerospace, providing increased and enhanced employment opportunities. The records will also point to good leisure facilities and an appreciation of the importance of the green belt. They will also point to a recognition of the need for modern health service and further education centres, of churches and the preservation of the good buildings of the past.
  As Frank Schaffer said in his book "The New Town Story", of which I am sure hon. Gentlemen here gathered are well aware:
  "A new town does not exist in a vacuum. It can be studied as an individual project, it can be pronounced a success or failure according to a critic's view of the planning, design, rate of building or social content. But in the national context the achievement of the new towns must be judged by the collective contribution they have made to the problems of overcrowding, the progress they have brought in the science of 'building for living', and the lessons they point for the future."
  That judgment can be the more accurately made if the Commission for the New Towns documents are made public, as the order envisages, and that judgment will be the more significant in its value, as the many hon. Members assembled here tonight clearly recognise, with the increasing realisation that our old towns must be the new towns of the future.
  12.15 am
  The Solicitor-General (Sir Patrick Mayhew): My hon. Friend has eloquently and ingeniously illustrated some of the merits of the order, which I hope the House will now approve.
  Question put and agreed to.
  Resolved,
  That the draft Public Records (Commission for the New Towns) Order 1984, which was laid before this House on 5th March, be approved.

  HOUSE OF COMMONS (SERVICES)
  Ordered,
  That Standing Order No. 103 (Select Committee on House of Commons (Services)) be amended, in line 7, by leaving out the word 'nineteen' and inserting the word 'twenty'.
  Ordered,
  That Mr. Carol Mather be added to the Select Committee on House of Commons (Services).—[Mr. David Hunt.]

  Trafford Park
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. David Hunt.]
  12.16 am
  Mr. Tony Lloyd: I am grateful for the opportunity tonight to raise the problems and talk about the future of Trafford park. The many hon. Members who have remained to hear this debate will appreciate that the problems of an area such as Trafford park represent not just a local constituency matter but are problems which threaten the whole conurbation of the Greater Manchester area and are central to the future of that area.
  I trust that the Minister will take on board the simple fact that the knock-on effect of the decline of Trafford park has not only affected my constituency and those areas bounding it but has had a dramatic and traumatic effect across the whole of Greater Manchester.
  I shall be referring later to the inner city partnership, but at this stage I should point out that of the jobs still existing in Trafford park, about 20 per cent. are filled by people who live in the Manchester and Salford inner city partnership areas, and that is significant in terms of the relationship between those areas and the problems of Trafford park.
  More widely, the travel-to-work area within which Trafford park currently operates is huge, much bigger than probably any comparable industrial estate in Britain. Trafford park is not just any industrial estate. It is the heart that, historically and to this day, pumps the lifeblood into the Greater Manchester area, into the city and into the commercial heart of the area and of the region.
  The Government's response tonight and in the future to the problems that I am outlining will be critical in deciding not simply whether the industrial estate per se has a future but whether the whole of that area has a future, including the social consequences if the Government decide not to grant it that future. There is an overwhelming case—one that is supported across party political lines and across industrial lines; trade unionists and industrialists support it — for saying that Trafford park should receive assistance from the Government in the very near future.
  I am proud of having been born and raised in the area. I am justifiably proud of Trafford park, not only because it was once the largest industrial estate in the world, not only because for the bulk of the 20th century it has been the heart that has driven British industry, but because from one generation to the next it has been the mechanism by which the skills on which Manchester thrived were passed on and one generation after another learnt that tolerance and comradeship and the dignity of labour of which the Labour movement in particular is proud.
  Sadly, the area began to decline in the post-war years. It declined simply because of the decline in general of manufacturing industry, and particularly of the heavy engineering base on which Trafford park was built. That decline has been central to the problems not only locally but throughout the conurbation. It is not remotely unfair to say that Mancunians feel extremely bitter at the indifference of Whitehall — not just of the present Government but of Governments in general — to the plight and decline of that industrial base.
  Perhaps I can bore the House slightly with some statistics that accurately measure the pace of that decline. About 170,000 people had to leave the north-west between
  264
  1965 and 1981 simply because work was not available. Those people had the traditional skills on which the northwest was based. It is estimated that a further 250,000 people will leave during the 1980s. In 1965, less than 20 years ago, Trafford park employed about 52,000 people. By 1975, that figure had dropped to a little under 38,000. I hope that Conservative Members will bear in mind that that decline was arrested under the previous Labour Government—although not reversed—when employment dropped to a little under 37,000. But since then the pace of decline has been spectacular and disastrous in every sense of the word.
  Mr. Churchill: Will the hon. Gentleman allow me?
  Mr. Lloyd: I am not sure whether it is worthwhile giving way, but I shall do so.
  Mr. Churchill: I am obliged to the hon. Gentleman for giving way. Until a few moments ago I was in complete agreement with him. There is complete agreement among the three hon. Members who represent the Trafford district that Trafford park should be included within the partnership area as it has many problems in common with Salford and Manchester. However, the hon. Gentleman sought to bring in party politics by suggesting that the decline accelerated at a particular moment, and by doing so he trod on very dangerous territory. He should not forget that in the late 1960s, under a Labour Government, 8,000 out of 16,000 workers were made redundant at GEC alone in Trafford park. At that time no help was forthcoming from the Labour Government, who were very strictly controlling industrial development certificates to ensure that even those firms that wished to expand in Trafford park were not allowed to do so. That has been a problem——
  Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. An Adjournment debate is very short and the hon. Member for Davyhulme (Mr. Churchill) has already made a long intervention.
  Mr. Lloyd: I am sorry that I wasted the time of the House by allowing the hon. Gentleman to intervene. However, those of us who were born in the area need no lessons from anyone about the history of Trafford park or the Stretford area. I have far better credentials than some hon. Members to speak about the area from the heart.
  As recently as 1980 only one in 25 of jobs lost: in Greater Manchester were in Trafford. By 1982, that ratio had increased to one in seven, mainly as a result of the decline of Trafford park. The list of companies that have left Trafford park reads like a roll of honour of international companies: Kraft, Spillers, Ingersoll Rand, NEI, Schreiber, and ICI. I should add that CPC has suffered massive redundancies but has not closed.
  Leading international companies have made massive redundancies. I mention in particular—as did the hon. Member for Davyhulme (Mr. Churchill) — GEC. That company is still one of the most eminent and efficient in Britain. But without Government assistance it faces collapse, because there has been a collapse of the power engineering industry. I hope that the Minister will pass on that message to his colleagues in the Department of Trade and Industry.
  The reason for the collapse is not hard to find. Trafford park depends on manufacturing industry. In 1978, 77 per

  265
  cent. of the jobs in Trafford park were in manufacturing. Regardless of whether the hon. Member for Davyhulme likes it, there is a political point to make, because under this Government we have seen the collapse of manufacturing industry. There has been a 15 per cent. decline in manufacturing output, which has inevitably meant a very sad toll for Trafford park. Where the nation has been hammered Trafford park has quite literally been crucified. That is an indictment of this Government and their policies. They do not understand what happens when manufacturing industry is allowed to go into almost terminal decline.
  Mr. Terry Lewis: I also have good credentials when it comes to speaking about Trafford park. I spent 30 years of my working life there, including CPC. That firm has not closed and is thriving, although many good jobs have been lost. I think that my hon. Friend will agree that GEC has always been at the hub of Trafford park. It is within the Government's power to save that firm there and thereby to go some way towards saving the whole of Trafford park, including CPC.
  Mr. Lloyd: My hon. Friend is right. GEC now represents about one fifth of all jobs in Trafford park and, if it is allowed to fold, the impact will be disastrous. We should consider the impact of the collapse of manufacturing industry. Clifford ward in the borough of Trafford, which I still represent, has adult unemployment of above 30 per cent. and youth unemployment is in excess of 40 per cent. The figures are even worse in Moss Side, which is in the inner-city partnership. It would be incredibly naive for the Minister or anyone else to argue that there is any prospect of re-employing Old Trafford or Moss Side without the revitalisation of Trafford park.
  We have an inheritance of dereliction, obsolete buildings, derelict land, poor services, roads which are literally clapped out and docks which are effectively dead. The size of Trafford park compounds those problems. I emphasise that it is no simple industrial estate but a huge estate of some 2,000 acres. Its boundaries, put in terms of London so that the civil servants and the Minister can understand, would stretch from Horseguards parade to Notting Hill gate and from Sloane square to Westway. It has 21 million sq. ft. of floor space, of which some 2 million is vacant. Local industrialists are adamant that the poor environment militates strongly against any possibility of revival because it militates against investment.
  The problems are compounded by the indifference of Governments. We have witnessed the taking away of intermediate area status. That was a serious blow to Trafford park. There has been complete lack of recognition in the home county-dominated Government of the real scale of the problem. We have also witnessed the illogicality of the partnership scheme boundary. I hope that the hon. Member for Davyhulme agrees with me on that. It is obvious that neither the private sector nor the local authority can cope with the scale of the problem. We must insist that Government assistance is made available to overcome it. The borough of Trafford and Trafford park cannot compete with the special development areas and the new towns which have massive resources for advertising and attracting inward investment. However unpalatable it
  266
  is to the Government who are determined not to spend money, however worthy the cause, resources are the name of the game and the only possible solution.
  I do not doubt that the Minister will cite assistance that has been given to Trafford park such as derelict land grant and urban development grant. They have minimal impact and are irrelevant to the scale of the problem. We have an enterprise zone, about which I still have mixed feelings, that has created 1,100 jobs. We are grateful to everyone, but compared with the scale of the problem it is irrelevant. We need assistance on a realistic scale that will cope with the legacy that Trafford park has inherited. We need resources to ensure that existing firms can improve their facilities and expand and so that vacant and derelict sites can be developed. We also need resources to enable the local authority to undertake wholesale environmental improvements.
  We need the powers afforded by the inner-city partnership—rent relief, interest relief grants, industrial improvement grants and grants for improving properties and the environment. They can only come from the inner-city partnership scheme but we are denied them simply because of the bureaucratic rules that are drawn up by people who do not understand how local economies work. They think that it is possible simply to draw a line through local authority boundaries and that, because Manchester and Salford are average and afford a poor standard of living for their inhabitants, parts of Trafford should be ruled out because, on average, it is more affluent. I would be the last person to deny that Trafford is a relatively affluent borough. I have often complained in the council about its meanness in other areas, but Trafford council cannot cope with its problems and certainly not Trafford park. We need the powers that I have outlined because people in Salford and Manchester depend just as much as people in the borough of Trafford on Trafford park. I say that with no edge because my constituency straddles the inner-city partnership area of Manchester and parts of the borough of Trafford.
  We are facing the collapse of an entire conurbation, not just one industrial estate. We are not asking for anything unreasonable—it is simply not possible to do the job without Government assistance. We are paying the price of our legacies but the cost of the Government's indifference will be socially cataclysmic. That is why Manchester is rightly demanding that some action be taken to assist Trafford park.
  12.30 am
  The Under-Secretary of State for the Environment (Sir George Young): I am grateful to the hon. Member for Stretford (Mr. Lloyd) for drawing the attention of the House to the problems of Trafford park, an area about which he spoke with pride and concern. Those problems are not unfamiliar to the Government. My right hon. Friend the Secretary of State and other colleagues have visited the area, and not so long ago I spent the day in the borough. My officials recently met the chief executive of Trafford to discuss the borough's excellently produced "Case for Action", which I have read with great interest. My hon. Friends the Members for Davyhulme (Mr. Churchill) and Altrincham and Sale (Mr. Montgomery) have both written to my right hon. Friend pressing the case for special status for the borough.
  Mr. Fergus Montgomery: I am glad that my hon. Friend mentioned that point. In fact, the

  267
  representations cross party lines, and there has been a joint effort by the council and the chamber of commerce and trade. There is a united front from people who are determined to try to do something for Trafford park. It is ironic that, where Trafford touches Salford, one side of the local government boundary should get so much help whereas our side, with exactly the same problems, should get nothing at all.
  Sir George Young: I have been very impressed by the representations. Many firms in the area have also written in support of Trafford's case. I shall refer in a moment to the problems of the boundary.
  The problems are all the more familiar through being mirrored in other areas in which traditional industries have declined. This decline is all the more difficult to reverse because, as the hon. Member for Stretford said in his analysis, it has taken place over a long time and on a large scale. The buildings and land occupied by the older industries are often totally unsuited to the more modern technologically based industries.
  In the area, many buildings occupy tens of thousands of square feet and are hopelessly uneconomic to maintain. Much of the land is encumbered by obsolete infrastructure or has been spoilt by industrial processes. Roads and other communications in the area have become inadequate and can be replaced or uprated only at great expense.
  These problems are such that they cannot be solved simply by redrawing a partnership boundary here or pumping in public money there. They cannot be tackled without a substantial commitment from everyone concerned—central and local government, industry and local people. The hon. Member for Stretford seemed to think that there were some instant solutions. Frankly, there are not. There is a role for the Government to play, and I am optimistic about the future of the area. The Government believe that those public resources that are available should be used to encourage investment back into the areas.
  We are prepared to take the lead, but we cannot stay in the lead for ever. We wish to build up the impetus and momentum to get the area back on to a recovery route. Once recovery in an area such as this is under way, the Government would like to withdraw and let the private sector take over. I hope to say in a moment how we are now trying to provide that impetus in Trafford park, but let me first deal with the Manchester-Salford partnership and the incorporation of Trafford park. This raises an important issue regarding our approach to the regeneration of the inner cities.
  As the House will know, in two areas in England we have concluded that the scale and intensity of the problem are such that it was beyond the power of existing authorities to reverse the decline. In those areas —London and Liverpool docklands—we created the urban development corporations. Elsewhere it has been fundamental to our approach that we operate within the existing framework of local government, because the local authorities have the most detailed knowledge of the needs of their areas.
  We must, therefore, allocate the resources in accordance with the needs of each authority. As the hon. Member for Stretford knows, the Government carried out a full review of the list of designated districts, including
  268
  the partnership authorities, last year in the light of the detailed information on deprivation derived from the 1981 census.
  We made a number of changes, and some difficult decisions had to be taken. It was not possible, given the limited resources of the urban programme, to bring all areas with pockets of deprivation within its scope This means that in isolated cases a main road or canal can divide a derelict strip of land between one district which is designated and another which is not. That has happened in the case of Salford and Trafford because the designation must take account of the scale and intensity of deprivation in the district as a whole. There are a number of even stronger contenders than Trafford. This was recognised by the previous Labour Administration, which did not extend this status to Trafford.
  As the hon. Member for Stretford said, much of Trafford is attractive and prosperous, and there is no disagreement between us on that. There are a good many other districts spread around the country that border on deprived areas and where the deprivation does not respect the local authority boundary. Some, like Trafford, are good housekeepers and do not spend public money lightly. I do not underestimate the difficulties faced by local authorities in keeping their expenditure down to the levels that are necessary for our national economic strategy, but the special resources of the urban programme have to be concentrated on the authorities whose total needs in aggregate are the greatest.
  We are not indifferent to the needs of Trafford park, and we recognise the real problems of dereliction. The hon. Gentleman mentioned that Trafford park lies within the enterprise zone. The largest part of the zone is in Trafford park, and this can bring substantial benefit. In particular, it brings the important benefit of access to the urban development grant, which is a major new development within the urban programme. It does not present a total solution to such problems, but it has a role to play.
  The broad principle behind the urban development grant is to attract private sector investment back into inner cities by injecting a sufficient public sector contribution to cover the gap between the costs of the projects, including a reasonable allowance for developer's profit, and the expected return. It is for the local authority and the developer together to work out proposals. If they are approved, the Government pay 75 per cent. grant-aid on the local authority contribution.
  Since we launched the scheme, 125 projects have been approved, representing capital investment of over £300 million. Many of the projects are in areas just like Trafford park, where there has been precious little private development of any kind for many years. Although only a handful of such schemes have been completed, there am pointers to the type of scheme that could successfully be undertaken in Trafford park. Projects need not take place on municipally-owned land—in Dudley, for example, a firm has been helped by the council to expand its operation and more than double its work force with the aid of UDG.
  I am anxious, following the representations that have been made by all parties, to take further initiatives, and later on today I shall be writing to the Manchester chamber of commerce, the Trafford park industrial council and large firms in the area to draw their attention again to the

  269
  benefits of UDG. So far the local authority has put forward only three proposals for UDG, and there is scope for many more.
  The hon. Gentleman mentioned the enterprise zone, which brings real benefits, such as exemption from rates on industrial property, exemption from development land taxes, a greatly simplified planning regime, 100 per cent. tax allowances on industrial and commercial buildings, and various other incentives to economic activity.
  Some 68 firms have settled in the Trafford zone, representing investment of about £5 million and about 1,100 jobs. The firms include Lucas CAV, Mobil Oil, Don International, Reed Windows, Photoplus Processing—in other words a wide range of manufacturing, service and warehousing operations representing a stable base on which the future prosperity of the zone and of the area as a whole can be built.
  There is a lot of scope for further development in the Trafford park area of the zone. Recent monitoring carried out for my Department by consultants shows that progress has been held up by the relatively slow release of privately owned unused land on to the market. This is also a problem in other parts of Trafford park. In some cases land values may be pitched unrealistically high, in others a lack of infrastructure provision may be hampering development, and, in others, firms may be holding on to land in the expectation of future expansion.
  Mr. Terry Lewis: I am interested in the Minister's statement that land values might have been put rather too high in the Trafford park area. I suspect, and I should like the Minister to comment on this, that the land values have risen in direct proportion to the enterprise zone, and this is a criticism of some of the activity that is taking place there. Will the Minister address himself to my intervention in the speech of my hon. Friend the Member for Stretford (Mr. Lloyd), and concentrate some of his comments on the problems of GEC and what help the Government are likely to give, or can be persuaded to give, to that company?
  Sir George Young: The particular problem of GEC was not raised by the hon. Member for Stretford and it does not feature in the title of the debate. The Government recognise fully the contribution which the turbine division of GEC has made. It is one of the largest employers in Trafford park and one of the largest land holders. I shall write to it again in terms which I shall outline to try to make some further progress over the issue of the land. The need to put land to good use rather than hold it for a rainy day was part of the thinking behind the Government's introduction of land registers, which identified publicly owned land which could be released at realistic prices and developed. It might benefit some private companies with large unused land holdings to adopt a similar approach. As a further initiative in response to the representations which have been made by local Members, I shall be writing today
  270
  to the Manchester chamber of commerce, the Trafford Park Industrial Council and large firms in the area, including GEC urging them to explore what might be done to improve the availability of land for redevelopment. From my understanding of the area, there is real scope to release on the right terms land which could be developed to provide jobs for those who live in the area and goods and services which the country needs.
  There are two other, relatively modest, ways in which development can be encouraged in Trafford park with direct help from central Government. There is the derelict land grant and the traditional urban programme, which are bid for competitively by local authorities. They do not represent a comprehensive answer to an area's dereliction but can provide the initial impetus to improvement. As with other initiatives, there is a strong element of trade following the flag; once one site is developed, additional investment can be attracted to adjoining ones. Trafford council has not applied for traditional urban programme support for any commercially or industrially oriented schemes in recent years.
  I should also mention the question of Trafford park's status under regional industrial policy. Last December the Government published a White Paper, Cmnd. 9111, about regional industrial development, inviting comments on a proposed new framework for regional development grant. The closing date for comments is 31 May 1984, and I know that the hon. Gentleman and Trafford council itself have put forward Trafford's case.
  Trafford park represents almost a case study of an industrial area in decline, but it is an area with a great deal to offer. It has much infrastructure already in place. It has the resources of many firms which the hon. Gentleman mentioned which are household names and well established. But, above all, it has the human resources of a large skilled work force.
  The Government are very willing to do what they can to help within the resources available to us and the priorities set by the needs of different areas. Officers of the borough council are in touch with my Department's regional office and the UDG appraisal team.
  I am making contact with local businesses and I know that my hon. Friends the Members for Davyhulme and Altrincham and Sale as well as the hon. Gentleman will do what they can to support the Government's initiatives to encourage local businesses to come forward with UDG schemes and to consider again the derelict land which they do not need directly. If we can develop these initiatives and pull together the energies of all those who want to see Trafford park revived, we have the potential to arrest and then reverse the decline which the hon. Gentleman has mentioned. I look forward to substantial progress in Trafford park over the next few years.
  Question put and agreed to.
  Adjourned accordingly at seventeen minutes to One o' clock.

PRIME MINISTER
  Engagements
  Engagements
  Long-term Unemployed Persons
  Long-term Unemployed Persons
  European Community (Own Resources)
  European Community (Own Resources)
  EEC (Budget)
  EEC (Budget)
  EEC (Trade)
  EEC (Trade)
  Gibraltar (Visit)
  Gibraltar (Visit)
  Consumers (Expenditure)
  Consumers (Expenditure)
  Temporary Civil Servants
  Temporary Civil Servants
  Oxygen Concentrators
  Oxygen Concentrators
HOME DEPARTMENT
  Peter Sutcliffe
  Peter Sutcliffe
ENVIRONMENT
  Lyceum Club, Liverpool
  Lyceum Club, Liverpool
DEFENCE
  S90 Frigate
  S90 Frigate
  Vinten
  Vinten
  Warehousing (Woolwich)
  Warehousing (Woolwich)
  D-Day (40th Anniversary)
  D-Day (40th Anniversary)
  Arms Imports
  Arms Imports
TRADE AND INDUSTRY
  Prevention of Fraud (Investments) Act 1958
  Prevention of Fraud (Investments) Act 1958
  Local Guarantee Scheme
  Local Guarantee Scheme
  British Telecom (Accounts)
  British Telecom (Accounts)
NATIONAL FINANCE
  Building Societies
  Building Societies
  Family Income
  Family Income
  Personal Taxation
  Personal Taxation
  Pension Funds
  Pension Funds
  Privatisation (Fees and Commissions)
  Privatisation (Fees and Commissions)
  Income and Taxation
  Income and Taxation
  Defence Budget
  Defence Budget
  Retail Price Index
  Retail Price Index
  EC Staff (Income Tax)
  EC Staff (Income Tax)
  Pensioners (Taxation)
  Pensioners (Taxation)
  Age Allowance
  Age Allowance
TRANSPORT
  London Transport (Underground Closures)
  London Transport (Underground Closures)
  Heavy Lorries (Spray Guards)
  Heavy Lorries (Spray Guards)
  Road Bridges
  Road Bridges
ATTORNEY-GENERAL
  Road Accidents (No-fault Liability)
  Road Accidents (No-fault Liability)
ENERGY
  Plutonium Nitrate Shipment
  Plutonium Nitrate Shipment
  Convictions (Statistics)
  Convictions (Statistics)
  Mineworkers (Redundancy Payments)
  Mineworkers (Redundancy Payments)
  Coal Industry (Subsidence Payments)
  Coal Industry (Subsidence Payments)
  Nuclear Power
  Nuclear Power
WALES
  Vacancies
  Vacancies
  Redundancies
  Redundancies
  School Leavers
  School Leavers
  Physically Handicapped and Disabled Persons
  Physically Handicapped and Disabled Persons
  Dialysis Units (Privatisation)
  Dialysis Units (Privatisation)
  Dialysis Treatment
  Dialysis Treatment
  Housing Associations
  Housing Associations
  Prefabricated Reinforced Concrete Houses
  Prefabricated Reinforced Concrete Houses
  Hospitals (Waiting Lists)
  Hospitals (Waiting Lists)
HOME DEPARTMENT
  Police (High Command Posts)
  Police (High Command Posts)
  Pakistan Nationals (Asylum)
  Pakistan Nationals (Asylum)
  Libyan Nationals (Deportation)
  Libyan Nationals (Deportation)
  Prison Control (Report)
  Prison Control (Report)
  Woolwich Arsenal (Prison)
  Woolwich Arsenal (Prison)
  Terrorism
  Terrorism
  Licensing (Liverpool)
  Licensing (Liverpool)
  Metropolitan Police
  Metropolitan Police
  Citizenship Applications (Cost)
  Citizenship Applications (Cost)
  Computers (Personal Data)
  Computers (Personal Data)
  Drug Offences
  Drug Offences
EDUCATION AND SCIENCE
  Full-time Education
  Full-time Education
  Polytechnics and Colleges (Expertise and Research)
  Polytechnics and Colleges (Expertise and Research)
ENVIRONMENT
  Property Services Agency
  Property Services Agency
  Departmental Staff
  Departmental Staff
  Defective Houses
  Defective Houses
  London Electricity Board
  London Electricity Board
  Inner City Partnerships
  Inner City Partnerships
  Rents
  Rents
  Local Authorities (Accounts and Wages)
  Local Authorities (Accounts and Wages)
  Homeless Persons
  Homeless Persons
  Council House Sales
  Council House Sales
  Housing Association Dwellings (Sales)
  Housing Association Dwellings (Sales)
  Prefabricated Reinforced Concrete Houses
  Prefabricated Reinforced Concrete Houses
  Liverpool
  Liverpool
EMPLOYMENT
  Youth Training Scheme
  Youth Training Scheme
  Local Government Reform
  Local Government Reform
  Local Government Finance
  Local Government Finance
  Job Statistics (Merseyside)
  Job Statistics (Merseyside)
  Temporary Employment and Training Schemes
  Temporary Employment and Training Schemes
  Skill Shortage (West Midlands)
  Skill Shortage (West Midlands)
  Labour Statistics
  Labour Statistics
  Publications Distribution Co-operative
  Publications Distribution Co-operative
  Leicester
  Leicester
  Regional Benefit Investigation Teams
  Regional Benefit Investigation Teams
FOREIGN AND COMMONWEALTH AFFAIRS
  Chemical Weapons
  Chemical Weapons
  Belfast Passport Office
  Belfast Passport Office
  Staff (Statistics)
  Staff (Statistics)
  Departmental Expenditure
  Departmental Expenditure
AGRICULTURE, FISHERIES AND FOOD
  Temik 15G
  Temik 15G
  Maize Gluten
  Maize Gluten
  Pesticide Safety
  Pesticide Safety
  Physically Handicapped and Disabled Persons
  Physically Handicapped and Disabled Persons
  Indigenous Type Foods
  Indigenous Type Foods
  Food (Consumer Spending)
  Food (Consumer Spending)
  Birds (Imports)
  Birds (Imports)
SCOTLAND
  Infant Mortality
  Infant Mortality
  Employment Patterns
  Employment Patterns
  Labour Statistics
  Labour Statistics
  Redundancies
  Redundancies
  Charities (Registration)
  Charities (Registration)
  Old People's Homes
  Old People's Homes
  Sheltered Dwellings
  Sheltered Dwellings
  Family Aides
  Family Aides
  Primary Schools (Dundee)
  Primary Schools (Dundee)
  Housing Associations
  Housing Associations
  Liquor Licensing Laws
  Liquor Licensing Laws
  Electronics Industries
  Electronics Industries
NORTHERN IRELAND
  Terrorist (Prison Release)
  Terrorist (Prison Release)
  Terrorist Prosecutions (Guidance)
  Terrorist Prosecutions (Guidance)
  Armagh Prison
  Armagh Prison
  Labour Statistics
  Labour Statistics
  Teacher-Pupil Ratios
  Teacher-Pupil Ratios
  School Leavers (Employment)
  School Leavers (Employment)
  Assembly (Report)
  Assembly (Report)
  Housing Associations
  Housing Associations
  European Community (Regional Assistance)
  European Community (Regional Assistance)
THE ARTS
  Geffrye Museum
  Geffrye Museum
  Physically Handicapped and Disabled Persons
  Physically Handicapped and Disabled Persons
CIVIL SERVICE
  Staff (Statistics)
  Staff (Statistics)
SOCIAL SERVICES
  Costs (Statistics)
  Costs (Statistics)
  Pharmacists (Contract)
  Pharmacists (Contract)
  Disabled Shoppers (Costs)
  Disabled Shoppers (Costs)
  Joint Financing (Community Care)
  Joint Financing (Community Care)
  Dental Treatment
  Dental Treatment
  Joint Financing (Resources)
  Joint Financing (Resources)
  Housing Benefits
  Housing Benefits
  National Playbus Association
  National Playbus Association
  Benefits (Fuel Costs)
  Benefits (Fuel Costs)
  Fraud Officers
  Fraud Officers
  Doctors (Deputising Services)
  Doctors (Deputising Services)
  Means-tested Benefits
  Means-tested Benefits
  Imported Lenses (Quality Inspection)
  Imported Lenses (Quality Inspection)
  Cardiac Patients
  Cardiac Patients
  Optical Prescription
  Optical Prescription
  Attendance Allowance (Old People's and Nursing Homes)
  Attendance Allowance (Old People's and Nursing Homes)
  Neurosciences Services (Central Middlesex Hospital)
  Neurosciences Services (Central Middlesex Hospital)
  Drugs (Parallel Imports)
  Drugs (Parallel Imports)
  Dietary Problems
  Dietary Problems
  Supplementary Benefit
  Supplementary Benefit
  Benefits
  Benefits
  Death Grant
  Death Grant
  Prescription Charges
  Prescription Charges
  Benefits (Indexation)
  Benefits (Indexation)
  NHS Hospitals (Privatisation)
  NHS Hospitals (Privatisation)
  Disabled People
  Disabled People
  Attendance Allowance
  Attendance Allowance
  Haringey District Health Authority
  Haringey District Health Authority
  Home Help Service
  Home Help Service
  NHS Staff (Movement)
  NHS Staff (Movement)
  Care in the Community (Representations)
  Care in the Community (Representations)
  Departmental Office Network
  Departmental Office Network
  Departmental Manpower
  Departmental Manpower
  Hearing Aids (Battery Contract)
  Hearing Aids (Battery Contract)
  Maternity Benefits
  Maternity Benefits
  Audiological Medicine (Consultants)
  Audiological Medicine (Consultants)
  Griffiths Report
  Griffiths Report
  Down's Syndrome Babies (Hammersmith)
  Down's Syndrome Babies (Hammersmith)
  Hertfordshire and Essex Hospital
  Hertfordshire and Essex Hospital
  Aldicarb
  Aldicarb
  Physically Handicapped and Disabled Persons
  Physically Handicapped and Disabled Persons
  Family Aides
  Family Aides
  Old People's Homes
  Old People's Homes
  Specialist Claims Control
  Specialist Claims Control
  Bed and Breakfast Accommodation (Oldham)
  Bed and Breakfast Accommodation (Oldham)
  Hyperactive Children
  Hyperactive Children
  Irradiation (Food Preservation)
  Irradiation (Food Preservation)
  Kidney Donation
  Kidney Donation
  Child Additions
  Child Additions
  Hospital Closures
  Hospital Closures
  Unclaimed Benefits
  Unclaimed Benefits
  Yorkshire Regional Health Authority (Retirements)
  Yorkshire Regional Health Authority (Retirements)
  Disabled Persons (Legal Entitlements)
  Disabled Persons (Legal Entitlements)
  Hospitals (Privatisation Contracts)
  Hospitals (Privatisation Contracts)
  Health Promotion Research Trust
  Health Promotion Research Trust
  Spectacles (Dispensing)
  Spectacles (Dispensing)
  Severe Disablement Allowance
  Severe Disablement Allowance
  Oxygen Concentrators
  Oxygen Concentrators
  Kneels of Exeter (Laundry Tender)
  Kneels of Exeter (Laundry Tender)
  NHS (Staff Retirements)
  NHS (Staff Retirements)
  Child Allowance
  Child Allowance

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

Glorious Revolution: Tercentenary
Lord Henderson of Brompton: 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 will initiate consultations in both Houses of Parliament with a view to the celebration in 1988 of the tercentenary of the Glorious Revolution.
The Lord President of the Council (Viscount Whitelaw): My Lords, I am not aware of any general wish for such a celebration, but the Government would be prepared to consider this matter if there were evidence of widespread interest in both Houses.
Lord Henderson of Brompton: My Lords, I thank the noble Viscount for that non-committal reply. I hope he is not put off by the fact that the Tories were virtually excluded from office for nearly a hundred years after the Glorious Revolution. May I ask the noble Viscount whether he does not agree that the significance of the year 1688 is that the modern parliamentary system dates from the Glorious Revolution, whereby the Government depend upon a majority in the House of Commons for their existence, and is this not worthy of celebration? Further, is it not worthy of celebration that we have had peaceful changes in administration for nearly 300 years? Would it not be particularly suitable to celebrate that fact in what might well be an election year?
Viscount Whitelaw: My Lords, I was not quite sure what the noble Lord, with his unrivalled knowledge of this House, and indeed of Parliament, was going to produce for me. On his first point, no, I do not think I would be deterred by that fact, particularly since it happened such a long time ago. On the second point, I think it is really a matter for Parliament. I agree with the noble Lord that this is a parliamentary anniversary, and that is why my Answer—that it is for both Houses of Parliament to decide to put it forward, and not the Government—is, I think, in the circumstances, a proper one. On whether it would coincide with a general election, and whether we made sure that there was a peaceful transition from one Government to another, I would agree with the noble Lord that our system of government, and in fact the system of both Houses of Parliament—and I say that quite advisedly—is something of which this country has every reason to be proud.
Lord Blake: My Lords, would the noble Viscount not agree that in fact there is no danger of this
130
celebration coinciding with a general election? A general election cannot take place later than June 1988, and the Glorious Revolution occurred in the November or December of 1688.
Viscount Whitelaw: My Lords, the moment my noble friend Lord Blake rose I knew he was going to teach me something, and there is a great deal of opportunity for him to do so. Had I looked at the excellent brief I have been given I would have known that fact for myself; but I am extremely grateful to my noble friend for having pointed it out to me.
Lord Ross of Marnock: My Lords, would the noble Viscount not agree that in 1688 there were two Parliaments, and there was probably a little more enthusiasm for one than for the other?
Viscount Whitelaw: My Lords, I think I shall leave the noble Lord to speak for himself on that matter.
Lord Underhill: My Lords, would the noble Viscount not agree that any celebration should take place only if it can be used to advance towards reconciliation and understanding? Unless that is done it can be counter-productive.
Viscount Whitelaw: My Lords, perhaps I should say in answer to the noble Lord that if any such celebration did come from the views of both Houses of Parliament, then I do not doubt that that spirit of reconciliation and understanding would certainly be there.
Viscount St. Davids: My Lords, may I strongly support my noble friend for a very simple reason, in that I exist? May I give this personal explanation of my interest in this matter: that my five greats grandfather was busy being hanged as an Orange supporter when William was declared to be landing, and that this saved his life and my existence.
Viscount Whitelaw: My Lords, if we were to celebrate the existence of the noble Viscount, I am sure that is something that this House would surely wish to do.
Lord Beloff: My Lords, would my noble friend the Leader of the House not agree that if we are to take seriously the proposition of the noble Lord, Lord Henderson, that it is a matter for celebrating the coming of parliamentary government, the correct year for celebration would be in 1689 and not 1688, when Parliament itself was in abeyance?
Viscount Whitelaw: My Lords, I was going to come to the moment when I had to admit that I did get a degree in history at one stage, but when I begin to hear the noble Lord, Lord Blake, and the noble Lord, Lord Beloff, I recognise that my degree in history is not of the standing of theirs. Curiously enough, I concentrated at that time on the French Revolution, of which I remember absolutely nothing at all today.
Lord Elwyn-Jones: My Lords, if 1688 is to be celebrated, will it be borne in mind that a matter worthy of celebration was the recovery of the Great

131
Seal from the River Thames by the fishermen of Lambeth? It had been cast there by James II through, I regret to say, the last Welsh-speaking Lord Chancellor, Judge Jeffreys.
Viscount Whitelaw: My Lords, I can only say that I am very grateful for the fact that the noble and learned Lord was speaking in English. Had he been speaking as the last Welsh-speaking Lord Chancellor, I certainly would not have understood what he was saying. As regards the celebration of the recovery of the Great Seal, again I think that would be a matter for Parliament, and it might very well be worthwhile.
Lord Glenamara: My Lords, would the noble Viscount set his face and harden his heart against celebrating the driving out of the lawful monarch by religious bigotry?
Viscount Whitelaw: My Lords, this shows the wisdom of my suggestion, that if we are to proceed in this matter it should be by the decision of both Houses of Parliament.
Lord Leatherland: My Lords, if we are to celebrate any date, ought it not to be 5th November?
Viscount Whitelaw: My Lords, perhaps it would be correct for me to say, as I am always encouraging my colleagues to do, that that is another question.

London Docklands: Stolport Project
2.43 p.m.
The Earl of Kinnoull: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, may I point out to the House a small spelling mistake. "Stolpont" should read "Stolport". This error is, I am sure, due to my indecipherable writing.
The Question was as follows:
To ask Her Majesty's Government how soon a decision is expected on the stolport project in the London Docklands.
Lord Skelmersdale: My Lords, my right honourable friend the Secretary of State for the Environment has not yet received the inspector's report following a public local inquiry into the application for this project. When it is received the matter will be dealt with as speedily as possible.
The Earl of Kinnoull: My Lords, I thank my noble friend for that short progress report. Could he indicate how long the inspector is likely to take on a report of this nature? Secondly, would he agree that the stolport project is a bold and imaginative concept in the heart of the vital regeneration of London Docklands, and that it is being very ably led by the London Docklands Development Corporation?
Lord Skelmersdale: My Lords, the normal time scale for receiving such a report is of the order of seven to eight months. I can confirm that the stolport is in
132
the Royal Group of Docks in the London Borough of Newham and that it is within the area of the London Docklands Development Corporation. This corporation has been doing a magnificent job with other projects, and this is an appropriate moment to pay tribute to its chairman, Mr. Nigel Broackes.
Lord Underhill: My Lords, does the Minister agree that there is a widespread desire to see the regeneration of London Docklands? However, in view of the aircraft noise regulations which this House carried a few days ago—I understand that only one type of aircraft could use this airport, if it is established—is the Minister satisfied that such aircraft would come within the aircraft noise regulations?
Lord Skelmersdale: My Lords, that is exactly one of the points that such an inquiry is there to discover.

Education: Children with Special Needs
2.45 p.m.
Baroness Darcy (de Knayth): 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 how many, and what percentage of, children with special educational needs have transferred from special schools to ordinary schools since the coming into effect of the Education Act 1981.
The Earl of Swinton: My Lords, the Government do not collect information centrally about the movement of individual children. It is, however, possible to gain some impression of what is happening. There would appear to have been no large-scale transfer of children from special to ordinary schools in the 10 months since implementation of the Act. Nevertheless, there is an increasing demand from parents of children with special educational needs, particularly young children, for admission to ordinary schools, and a growing trend for local education authorities to make the first placements for such children in ordinary nursery schools or classes of ordinary primary schools. It seems likely that the integrated system will develop from the early years of childhood rather than by the large-scale transfer of older children from special schools. It is important to recognise that full integration needs considerable preparation and is not simply a matter of placing children in ordinary schools.
Baroness Darcy (de Knayth): My Lords, I thank the Minister for his Answer. May I ask him whether he can predict the annual rate of transfer of children with special educational needs from special schools to ordinary schools and, if he can, what the predicted rate is?
The Earl of Swinton: My Lords, I do not believe that anybody can predict the rate of transfer. At the moment the local authorities are preparing figures which will be available later in the year. However, I do not believe that they will necessarily show the rate of transfer.
Lord Taylor of Blackburn: My Lords, could the noble Earl the Minister tell us how many of the recommendations of the 1978 Warnock Committee and the 1980 White Paper have been carried out?
The Earl of Swinton: My Lords, the great bulk of these recommendations have been carried out. The White Paper was the Government's response to the Warnock Committee. This legislation is based on both the White Paper and the Warnock Report.
Baroness Fisher of Rednal: My Lords, is the noble Earl satisfied that children in ordinary schools who are suffering from sensory handicaps are receiving education from qualified teachers of the partially sighted and deaf?
The Earl of Swinton: My Lords, this is very much a matter for the local education authorities who, when they decide which school a child should go to under the new Act, have to take into account not only the special educational needs but also the medical needs and the wishes of the parents.
Baroness Fisher of Rednal: My Lords, the sensory handicaps which I mentioned come into the category of special educational needs. They are not what one could strictly call medical needs. I am asking about the specially qualified teachers who are needed for these special categories.
The Earl of Swinton: My Lords, all this is taken into account when the children are placed.
Lord De Freyne: My Lords, does my noble friend have any figures relating to those children with special educational needs who have been moved from their ordinary mainstream schools to special schools?
The Earl of Swinton: My Lords, this is the original Question in reverse, as it were. No, we have no such figures.
Baroness Masham of Ilton: My Lords, may I ask my noble kinsman or relative whether children with a physical defect or a speech problem who go to ordinary schools will get the physiotherapy or speech therapy which they need? Would he agree with me that if they do not get the treatment needed they might develop further defects?
The Earl of Swinton: My Lords, in the case of children formally assessed under Section 5 of the Education Act 1981 the statement should include the medical and health care needs as well as the educational needs. I think that I made that point to the noble Baroness, Lady Fisher. It is hoped that district health authorities will be able to meet those needs. However, it is realised that the problems of providing services to a population dispersed across a range of ordinary schools are greater than when providing similar services to pupils grouped together in a special school. This is one of the factors that should be considered by the LEA when determining the appropriate placement for each child. Also, the parents are of course consulted a great deal on where the children go. They may decide that they would
134
rather the child was educated in an ordinary school and receive the necessary medical treatment at the weekend, if they thought that was better in the overall interest of the child.
Lord Molloy: My Lords, does the noble Earl not agree that there is one group of children who cannot be transferred to ordinary schools; namely, those children who are both mentally and physically handicapped? In view of the existence of the remarkable teaching staff who are trained to help such afflicted children, will the Minister ensure that they are in some way helped and that we in no way dodge responsibility by having them transferred to ordinary schools?
The Earl of Swinton: My Lords, I agree entirely with the noble Lord; there will always be special schools, and there will always be special children who need special treatment.
Lord Chelwood: My Lords, is this not a matter of such importance that central records ought to be kept showing transfers between the mainstream schools and special schools and vice versa? How has it come about that there are no records? Will my noble friend look at the possibility of keeping such records and making them available annually?
The Earl of Swinton: My Lords, it would be a very complicated programme indeed if that was undertaken. The records which the local education authority has to send in during the course of the year to be analysed just refer to children with statements made under the Education Act 1981. Because of changing definitions and procedures, information will not readily be comparable with statistical data produced for earlier years.
With regard to information collected centrally about children with special educational needs in ordinary schools who do not have statements under the Act, this would involve requiring the schools to make a great many subjective judgments about their pupils and would create enormous difficulties in practice. The boundary between children with special educational needs and other children is not a clear one; some children will move between the two groups. Local education authorities will, however, require information about this wider group for their own purposes. The Government support the recommendations of the Warnock Committee in paragraph 4.78 of its report, that authorities should devise their own framework for collecting such information from their own schools.
Baroness David: My Lords, following upon a much earlier answer given by the Minister about the difficulty of receiving these children with special educational needs into ordinary schools, can the Minister say how much in-service training is under way to prepare teachers in ordinary schools for receiving children who might have problems?
The Earl of Swinton: My Lords, I see the noble Lord, Lord Mishcon, on the Front Bench opposite, and so I should like to thank the noble Baroness for that question.

135
There is already a wide range of in-service provision available for teachers responsible for the education of children with special educational needs. These include long full-time or part-time courses at teacher training institutions, short courses provided by local education authorities and their advisory services, regional courses funded by the department, and short courses organised by HMI.
Additionally, meeting special educational needs in ordinary schools is one of the priority areas to be supported by the new scheme of specific grants for in-service teacher training. In the period to 31st August of this year, about £1 million will be available for training in special educational needs in ordinary schools. My right honourable friend has invited the Advisory Committee on the Supply and Education of Teachers to review training provision relating to special education and to report early in 1984. Also, the department has launched an audio-visual in-service training pack for teachers in ordinary schools who have children with special educational needs in their classes. This pack is being very well received.
Lord Mishcon: My Lords, perhaps I may thank the noble Earl the Minister for his very brief and concise reply.
Viscount Ingleby: My Lords, is the noble Earl the Minister aware of the case of James, who is aged seven and is a pupil at one of our local primary schools in North Yorkshire? He could not hear anything but for the phonic ear that he wears. His teacher now wears a device that enables her to correspond directly with him—and because of this, he is making excellent progress.
The Earl of Swinton: My Lords, I did not know about James. Strangely enough, I do know about a great many children at some of the special schools in North Yorkshire. I am very delighted to hear that James is being well looked after.
Viscount Ingleby: The point is, my Lords, that he is in an ordinarv school.

Soccer Hooliganism
2.55 p.m.
Lord Gainford: 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 action they can take after the violence perpetrated by English soccer supporters in France.
Lord Skelmersdale: My Lords, the Government have already taken action to combat violence associated with soccer at home. It is in part due to the success of these measures that some so-called football supporters now seek to cause trouble abroad. Thus, my honourable friend the Minister for Sport has recently agreed with his colleagues within the Council of Europe a document listing the precautions which should be taken to curb violence. In the light of the violence in Paris, however, my honourable friend is again reviewing all the options open to the Government.
Lord Gainford: My Lords, I thank my noble friend the Minister for that Answer. Given all that we have heard about research by social workers and youth organisers, is any information available as to what actual pleasure is given to some of these young people who commit such acts? The Minister will know that the recent trouble in France was not just the result of violence erupting after the result of the match was known because the "yobboisation" began en route to France, several hours before the game started.
Lord Skelmersdale: My Lords, there are as many theories about why these misguided people commit such acts as there are theories about preventing them from doing so in the first place. The two theories which are currently being floated are boredom and the fact that hooliganism is far worse when matches are lost than when matches are won. I cannot place any reliance on either one of those theories.
Lord Beswick: My Lords, when considering these matters will the noble Lord bear in mind that, at the international match in Vienna last week, there was no trouble from the English spectators? They were addressed by the Austrian authorities over the public address system in English—not as potential thugs, but as sensible people who would wish to know what arrangements had been made. Is the noble Lord aware that, having been privileged to be present, I am quite convinced that that contributed to the good atmosphere which prevailed?
Lord Skelmersdale: My Lords, I am sure that the noble Lord is to a great degree correct. My information is that the Austrian authorities arrested 11 or so English people before the game started for various acts of hooliganism and vandalism. They were all released on 23rd March but have been banned from returning to Austria for five years. If one is in a situation where one can identify certain people before a match starts, then obviously that is the optimum position to be in. So often, the trouble erupts both during and after a match.
Lord Mishcon: My Lords, does the noble Lord not agree that it is not just a question of semantics but that there is a misnomer in calling these people, as the Question does, "soccer supporters"? Does he not agree also that they would be much more correctly called supporters of hooliganism, and not of sport? Finally, would he agree that one of the ways in which we can combat boredom among youth is to help with the youth clubs of this country much more substantially than we do—for at the moment, they are largely unsupported financially—in the hope that young people will be induced to join youth clubs and be taught proper behaviour?
Lord Skelmersdale: My Lords, so far as semantics are concerned, the noble Lord is quite right and "supporters of hooliganism" may well be a more appropriate term. I must confess that I did strike out from my brief at one stage the words "mindless thugs".
As far as youth clubs are concerned, the noble Lord is again quite right in saying that they could well help,

137
but I myself cannot help thinking that there is a certain breakdown in the discipline of the family which could be at the root of such behaviour.
Lord Avebury: My Lords, can the noble Lord confirm that some impressive results have been achieved in Scotland by measures to reduce the consumption of alcohol at and around football grounds, and does not that experience provide a lesson for the authorities in England and Wales?
Lord Skelmersdale: Yes, my Lords, it might, but I am afraid that our researches have shown that it is difficult to link misbehaviour directly to alcohol. Where alcohol has been shown to be a contributory cause—and this, I am afraid to say, does happen in the North-East of England and in Scotland—the banning of alcohol has had a very great effect in the correct direction.
Lord Molloy: My Lords, would the noble Lord not agree that it might be worthwhile recommending to the Minister responsible for sport that he should have a conversation with the supporters of clubs in the Rugby Union and Rugby League, as despite the boisterousness and toughness of the game hooliganism hardly seems to occur at any rugby football ground?
Lord Skelmersdale: My Lords, I am sure the noble Lord is right, but that is another question.
Lord Glenamara: My Lords, while not in any way condoning the violence in Paris or doing other than condemn it, does the noble Lord not feel that the appalling brutality of the French police was at least a factor in it—brutality which the whole world saw on television?
Lord Skelmersdale: My Lords, from this Dispatch Box I cannot answer for the French police.

Dinner
Lord Denham: My Lords, it may be for the convenience of your Lordships if I announce that, owing to the rather heterogeneous collection of business on the Order Paper today, there will be no specific dinner adjournment, but nonetheless dinner will be available at the usual time of 7.30 this evening.

Aberdeen and District Milk Marketing Scheme (Application to Banff) Revocation Order 1984
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, I beg to move that the draft order laid before the House on 25th January be approved.
Moved, That the draft order laid before the House on 25th January be approved.—(Lord Gray of Contin.)
On Question, Motion agreed to.

Aberdeen and District Milk Marketing Scheme 1984
Lord Gray of Contin: My Lords, I beg to move that the draft scheme laid before the House on 13th February be approved.
Moved, That the draft scheme laid before the House on 13th February be approved.—(Lord Gray of Contin.)
On Question, Motion agreed to.

Tenants' Rights, Etc. (Scotland) Amendment Bill
3.3 p.m.
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 ABERDARE in the Chair.]
Clause 1 [Calculation of discount and period of occupation]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 1:
Page 1, line 8, leave out paragraph (a).
The noble Lord said: This is a very simple amendment. The clause reduces to two years the length of tenancy after which people are entitled to a statutory right to purchase their houses, and automatically grants them a 32 per cent. discount on that purchase. I do not think there is any businessman in this Committee who would like to be under such an obligation in respect of any tenant at all. While I certainly accept the fact that three years is the existing position, it is carrying matters to an absurd point that someone who becomes a tenant is automatically given security of tenure and, after paying his rent for two years—I repeat, two years—can purchase that house with a discount of 32 per cent.
This is not a bargain that has been freely struck in respect of purchasing a house with a sitting tenant; this is part of the argument in respect of the 32 per cent. One need only read the original Bill. The valuation is carried out by the district valuer, or some other appointed qualified valuer, and after the price has been reckoned the Government formula has to be applied. It is not the local authority which is selling the house. The purchaser is the tenant who is given this considerable right by the Government. The house belongs to the local authority. In fact, when first we embarked upon local authority house-building it was the pride and glory of the party opposite. We introduced into this House not all that long ago the noble Earl, Lord Stockton, whose great pride it was that he was going to build 400,000 houses in one year—
Noble Lords: It was 300,000!
Lord Ross of Marnock: Was it only 300,000? I am glad to be corrected. But that was the importance he felt as to the need for good housing for the people. If one reduces the stock of those council houses it automatically means that the people who are on a waiting list must wait all that much longer; and, of course, this Bill will encourage more people to purchase houses.
I believe the number of local authority houses in Scotland is about 887,000, and if one adds in the new towns and Scottish special housing association houses, it is probably about one million. When one considers the population of Scotland, your Lordships may well say that that is a very big proportion. Of course it is, but that shows how bad Scottish housing was previously. The fact that there are still about 150,000 to 160,000 people waiting for a house is a very serious matter when the stock is being reduced. One must remember that people who are actually in houses are waiting for a better house, and the kind of house that is being sold at present is the best type of house.
The Government say that just over 40,000 houses have been sold. It has not been a great success in Scotland. If one looks again at the kind of houses that are being sold, in the area I know well—in Kilmarnock and Glasgow—it is reckoned that the best houses that other people want to get into are being sold. So the Government are selling the hopes of a better house and are selling the best of the stock. I think that enough is enough. We agreed to three years, but to go further and give people this kind of right after two years is just too much. I beg to move.
Lord Mackie of Benshie: I must say that on Second Reading the noble Lord, Lord Gray, expressed satisfaction at the rate houses had been sold, and he told us that the number of applications which were being received each month he deemed to be satisfactory. In this case I must agree with the noble Lord, Lord Ross, that, if it is satisfactory, why on earth is the Minister reducing the qualifying period? It is true, of course, that the most desirable houses are being sold. If someone is allocated a new house they can buy it in two years. I think the three-year period is plenty. Quite frankly. I do not understand the rush to add further attractions in order to improve a situation which has been described as satisfactory.
Lord Gray of Contin: I am grateful to the noble Lord, Lord Ross, for the way in which he has moved this amendment. I cannot agree with him, of course, and I think that the flaw in his argument is that he revealed the basic dislike of this party towards the whole principle of selling council houses. I know that members of his party suggest that they are not against the principle, but in every argument which has taken place, either in another place or during the Second Reading debate here, that weakness in argument has been revealed. The noble Lord's party is basically opposed to this principle, and, of course, naturally uses every means at its disposal for arguing that case. In the case of the noble Lord, Lord Mackie of Benshie, his party is not opposed to the principle of selling council houses, and in replying to this amendment I shall try to explain to him why we believe that the course we are following is desirable.
140
The purpose of paragraph (a) of subsection (1) of Clause 1 is to reduce the basic qualifying time for the right to buy from three years' tenancy to two years' tenancy. Under the existing provisions of the Tenants' Rights. Etc. (Scotland) Act. a tenant must have been in occupation of publicly provided housing for at least three years before he qualifies for the right to buy. If a tenant has the necessary three years' occupation for the right to buy, this entitles him to a basic discount of 33 per cent. on the market value of his home. If he has further periods of "continuous occupation" in publicly provided housing, then he is entitled to an additional 1 per cent. discount for each year beyond the three years' qualifying time up to the current maximum of 50 per cent. after 20 years' tenancy. Clause 1 of the Bill will of course amend the discount scale so that the maximum discount available to tenants will be increased to 60 per cent. after 30 years' tenancy. As well as reducing the basic qualifying period for the right to buy from three years to two years, Clause 1 also makes a consequential change to the discount scale so that it starts at 32 per cent. after two years' tenancy.
As my right honourable friend the Secretary of State for Scotland explained when the provision reducing the qualifying period was discussed in another place, there is no particular magic about the three-year cut-off point for qualification for the right to buy. It is obviously necessary to ensure that only bona fide tenants qualify for the right to buy: that is. tenants who occupy the property on a long-term basis. However, we have now concluded that two years' tenancy is long enough for this purpose. The change to two years will, we estimate, be of immediate benefit to some 30,000 tenants who will be entitled to buy at the new basic discount of 32 per cent.
Similar changes are being made to the right to buy rules in England and Wales in the context of the current Housing and Building Control Bill. These changes represent an important improvement in the right to buy, and I urge the noble Lords to withdraw their amendment.
I think that when on reflection noble Lords consider what I have said and consider the opportunity which will be afforded to a section of the community to make this purchase, they will agree that it is a step in the right direction. The noble Lord, Lord Ross of Marnock, said that the policy of selling houses has not been particularly popular. But in fact it has been popular. It has been popular in Scotland with 46.000 households. That may be a small number out of the total number of houses that are municipally owned in Scotland; but I suggest that the policy in Scotland over the years has been a bad policy. There have been far too many people in municipally owned houses instead of their being encouraged to buy their own homes. For that reason, I believe that the policy which the Government are following is the right one and that this amendment is a mistake. I ask noble Lords to consider withdrawing it.
3.13 p.m.
The Earl of Perth: I have listened to the explanation of the noble Lord, Lord Gray of Contin. It seems to me that a discount of nearly a third at the end of two years is pretty considerable. If it was said that the discount at

141
the end of two years was, let us say, 20 per cent., or even 25 per cent., I could understand it. But I think that it is a bit tough that after two years someone can get something for as little as that. I am not quarrelling about the idea of two years rather than three, although I know that the noble Lord, Lord Ross of Marnock, is suggesting that we should be back to the three-year period. But I would ask the noble Lord, Lord Gray, perhaps to look again at the discount that is proposed.
Lord Wilson of Langside: I, too, have listened to the Minister's reply to the arguments presented in support of this amendment. I listened particularly because of course what was said in support of the amendment was a considerable argument. I was genuinely waiting to hear what the answer to these arguments would be, but the Minister has not told us anything at all that we did not know already. We know that the original Bill provided for a period of three years and that the Bill before us reduces that period to two years, but not a single word has been said to justify this change in answer in particular to the argument of the noble Lord, Lord Mackie of Benshie, but equally to that of the noble Lord, Lord Ross of Marnock. The matter therefore remains something of a mystery, certainly to someone like myself who was simply waiting to hear the argument and reach a conclusion about it. I think that the Government have no answer to the arguments which have been put forward in support of this amendment.
The Earl of Selkirk: I wonder whether I may ask my noble friend for one word of clarification. In the course of his remarks he used two words, "tenancy" and "occupation". Which is it? Does the provision mean that someone has to pay rent for two years or actually has to live in the house for two or three years? I am not very clear which of those it means, particularly in view of subsection (3), which I think repeals certain words in the previous Act. I am afraid that I have not checked exactly what those words are.
Lord Mackie of Benshie: I am sorry to rise again, but I think that the Minister spoke to another proposed change, which is to raise the discount available to 60 per cent. I also find this inexplicable. I agree that it is a very good thing to encourage people to buy their own houses and their council houses, but we should not throw them away, and throw them away to a certain section of the community only. I come back to my old plea for the farm worker. The farm worker provides his own accommodation during his working life by his labour on the land but he has no right to buy that house, a council house or any other house at a discount of 50 percent., 30 per cent. or even 10 per cent. Why then should we deprive local authorities of the money that they should be using to provide retirement houses for these farm workers who have worked all their lives to provide their own accommodation?
This is the flaw in the argument. I do not see that the provision is necessary. It will deprive authorities which are very hard up of money that could be used, together with Government assistance, to build greatly needed houses. I fail to see the reason for the proposal, unless it is simply that the Government want to give away money, and they have not shown much sign of that up to now.
Lord Gray of Contin: I think that some of your Lordships have been arguing a false case, and I shall try to explain why I believe that is so. I have sympathy with my noble friend Lord Selkirk who asked me why I thought the proposal was necessary, and I have sympathy with other noble Lords who suggested that the discount was too high. But the level of discount reflects the fact that any house with a sitting tenant has a substantially lower value than one with vacant possession. Therefore, anything which can be done to encourage a sitting tenant to take advantage of the opportunity which is available to him to purchase his house must ultimately be to the good, and to the good of the local authority.
I come back to the point that the noble Lord, Lord Mackie of Benshie, made. By encouraging additional tenants to purchase their houses the local authority will have available to it greater funds than it otherwise would if it did not encourage tenants to purchase. I will not be drawn into the argument about agricultural workers. I know that it is dear to the heart of the noble Lord, Lord Mackie of Benshie, as it is to the hearts of many other noble Lords. But I merely say that the local authority or local authorities in general would have more money available, the more houses they sell. So that the step which we are taking here, by encouraging tenants, by offering them a higher discount, obviously must improve the potential for the sale of council houses. I am not quite sure of the point which my noble friend Lord Selkirk was making when he asked me about the difference between tenancy and occupation; but I think that I would be right if I said a secure tenant in occupation of a council house would be a tenant paying rent. I hope that answers the point which the noble Earl raised.
I am afraid I am not persuaded by the arguments in favour of this amendment. What we seek to do is the right policy. I believe that by doing so we will give hope and opportunity to tenants who might not otherwise be able to invest in the purchase of their own homes, and I hope that noble Lords, on reflection, will consider withdrawing the amendment.
Lord Tordoff: If that argument is to be carried to its logical conclusion, the Government will shortly be offering a 30 per cent. rebate after no occupation at all.
Lord Wilson of Langside: I am sorry to come in again, but that is exactly the point which the Minister has not faced up to. He compares the situation with the situation of a tenant of a private house,—a sitting tenant buying—and of course there would be some discount which would be acceptable in such a case. But here the tenant has also, as it were, a statutory built-in-right. You can lease a local authority house and have a statutory right to this extraordinarily large discount, and this is something that the Government must face up to.
Lord Hughes: When the Minister in his last intervention justified the selling of these houses at a discount, he pointed out, quite rightly, that the value of a house with an occupying tenant is less than a house to which the purchaser can immediately gain entry. When the Government originally fixed the discounts at figures between 33 and 50 per cent., did

143
they have any evidence that the prevailing discount in these circumstances, when a house with a tenant was being sold, was anything like these percentages? Have they now any evidence that the figures at which such a house would be sold would range at a discount of between 32 and 60 per cent. I would doubt very much if they could produce any evidence to justify these percentages on the basis of the principle to which he referred.
Lord Gray of Contin: If I may take the point raised by the noble Lord first of all, I would not agree that that is necessarily the case. If I may answer his question, the Government obviously took advice on this matter before reaching a conclusion as to the desirable discounts to be offered. But of course this could conceivably vary from one part of the country to another. But nevertheless I would not agree with him that this was not realistic. Anybody who has owned property and has had that property occupied by tenants will appreciate that the value of that house is vastly reduced, so far as a sale is concerned, by the fact that it is occupied by a tenant. Therefore that must be reflected in the price which is offered. As we see it, we believe that we have got it just about right regarding discounts. We feel that what we are doing here is an encouragement to a group of people for whom this 1 per cent. might be the difference between being able to make such a purchase and not. As I mentioned earlier, we believe that there are probably about 30,000 people who conceivably could benefit by this decision, and I think that it is the right decision in those circumstances.
The noble Lord, Lord Mackie, and the noble and learned Lord, Lord Wilson of Langside, have made points with which I think I have already dealt. I believe that the attitude the Government have adopted is the right one. I do not think that it is reasonable to suggest for one moment that the discount will go down and down. That is not necessarily the case. This is a conscious decision at each stage on the part of the Government, and if the Government saw or considered that there was likely to be a substantial increase in sales by the dropping of a percentage point to one group then I think that the Government are perfectly justified in taking that decision. I believe that in this case here we are taking the right decision, and that we are giving the opportunity to 30,000 additional council tenants to purchase their homes. I cannot believe that that is wrong.
Baroness Carnegy of Lour: Before the noble Lord sits down, can he tell the Committee and the people of Scotland whether, if this amendment was accepted, the people of Scotland would be at a disadvantage as compared to the people of England, if the England and Wales Bill goes through?
Lord Gray of Contin: In that regard, yes. The particular group of people to whom I referred could be at a disadvantage; but it is our hope that this amendment will not be accepted, and that the 30,000 people who stand to benefit will be enabled to do so.
Lord Tordoff: On that particular point, if we are going to detain the Committee on matters of this sort
144
and debate amendments, what is the point in bringing Scottish Bills before your Lordships if they have to be identical with the Bills on England and Wales that go through?
Baroness Carnegy of Lour: Is not the law in Scotland slightly different?
Lord Gray of Contin: I am not going to start up any animosity between Scotland and England if I can possibly prevent it. But it has been a tradition that Scotland, on major issues—and housing has always been considered one of those major issues—has had its own legislation. I am dealing with a Scottish Bill at the present moment, and I was asked a question relating to an English Bill which I answered as best I could. However, I would rather direct my attentions towards this Tenants' Rights, Etc. (Scotland) Amendment Bill.
The Earl of Perth: Before the noble Lord, Lord Ross, speaks, could the noble Lord, Lord Gray, help us a little more? I can understand that a 32 per cent. or 33 per cent. discount in relation to somebody who is already there as a tenant is a reasonable discount. But—and I think it was the noble and learned Lord, Lord Wilson of Langside, who made this point—what about somebody who now, today, gets a council house? He is pretty lucky. He had no tenancy right; but what the Government are going to give him under this Bill, if I read it aright, is, in two years, to get the house at a 32 per cent. discount. In other words, those who are lucky enough to get a new tenancy after this, with no tenants' rights, are going to be particularly fortunate as opposed to those in the past because they are getting a house which enables them to buy it at the end of two years for one-third less than its value. It seems to me that that is mistaken.
Lord Ross of Marnock: I entirely agree with the noble Earl, Lord Perth, in his remarks. He said that he was looking at the extent of the discount. I approached it from the point of view of the two years rather than the three years; but he has a very valid point even at three years, to give someone a 33 per cent. discount. It takes a bit of understanding how business men, who look at things rather fairly, should agree to this.
The noble Baroness, Lady Carnegy, seems to suggest we must not put the Scottish tenants at a disadvantage as against the English tenants. Simply because they put it in an English Bill, must we do the same? When was that a rule in Scotland? The Secretary of State is sitting beside the noble Baroness. He will know better than anybody else that the housing legislation for Scotland is very different. The noble Baroness will be suggesting next that we take away the Scottish Special Housing Association because there is not one in England. Housing in Scotland, under legislation, is dictated by the conditions in Scotland. The noble Lord seems to think that we have an animus against people buying their own houses. People in Scotland would love to have been able to buy their own houses but there was mobility of labour that demanded tenancies. There are many of the Glasgow and Edinburgh people who are landlords of private tenant property who are delighted about that.
Scarcity and bad conditions created the need for local housing authorities to provide houses, and in fact

145
it was a Labour Government who provided in the original legislation that if five ratepayers were dissatisfied with the rate of building, they could apply to the Government in order to force the local authority to build. Never did I think that we should reach the position where a local authority would be forced by a Government to sell council houses.
But it is a strange doctrine. The only justification for it that we were given in the first speech of the Minister was that the Government had decided to redefine a long-term, stable tenant; and a long-term, stable, bona fide tenant is to be one who has been there for two years—two years! I ask the Committee to remember that such a person already has security of tenure, and to give him a 32 per cent. discount after two years beggars logic. But then the Government have been beggaring logic all through. Take the case of a tenant who has been in a house for 30 years or more. That is the last house that the local authority would sell because the tenant is older and the house would be likely to become vacant and so be available for, say, a person in a rural area who required it. But, instead, in a case such as that the Government are forcing the local authority to give a 60 per cent. discount. It really is crazy business.
We must remember that in fact the Government do not own the houses. When the local authorities built houses before the war they took on a 40 per cent. debt. and, notwithstanding a Government subsidy, the Government insisted that a quarter of the amount had to be paid by the local authorities. So the local authorities and the ratepayers are the owners of the houses. After the war, due to rates of interest, the debt rose to 60 per cent.; and of course the debts are still there. The noble Lord said, "Look at the money that the local authorities will be able to spend on housing". But will he look at the capital allocations? The Government determine exactly how much the local authorities will receive for capital spending on housing each year. By how much is that going down? It has been going down and down.
It is disgraceful to put an argument on those lines and then to suggest that there is animus on our part. When I was Secretary of State I allowed local authorities to sell houses; but after approval everything was left to the discretion of the local authorities, and anyone who wanted to buy a house had to be on a housing list. So, please, let us not have this kind of argument and let it not be suggested that there is animus. This is a matter of commonsense, and I think that anyone who has listened to the debate will hardly have been convinced by the repeated assertion of the Minister of State. All he says is that the Government think that it is right. Well, I trust that the Committee will think that it is wrong.
3.34 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 96; Not-Contents, 108.

CONTENTS

DIVISION NO.1

Airedale, L.

Banks, L.

Ardwick, L.

Barnett, L.

Attlee, E.

Beswick, L.

Aylestone, L.

Birk, B.

146

Blease, L.

Kilmarnock, L.

Blyton, L.

Kirkhill, L.

Boston of Faversham, L.

Leatherland, L.

Bottomley, L.

Llewelyn-Davies of Hastoe, B.

Brockway, L.

Lloyd of Hampstead, L.

Brooks of Tremorfa, L.

Lloyd of Kilgerran, L.

Burton of Coventry, B.

Loudoun, C.

Carmichael of Kelvingrove, L.

Lovell-Davis, L.

Collison, L.

McCarthy, L.

Cooper of Stockton Heath, L.

McIntosh of Haringey, L.

David, B. [Teller.]

Mackie of Benshie, L.

Davies of Leek, L.

McNair, L.

Dean of Beswick, L.

Mais, L.

Denington, B.

Milverton, L.

Donaldson of Kingsbridge, L.

Mishcon, L.

Donnet of Balgay, L.

Molloy, L.

Elwyn-Jones, L.

Oram, L.

Ennals, L.

Phillips, B.

Ezra, L.

Ponsonby of Shulbrede, L.

Fisher of Rednal, B.

[Teller.]

Fitt, L.

Raglan, L.

Fletcher, L.

Rathcreedan, L.

Gaitskell, B.

Rhodes, L.

Gallacher, L.

Rochester, L.

Gladwyn, L.

Ross of Marnock, L.

Glenamara, L.

Sainsbury, L.

Graham of Edmonton, L.

Shackleton, L.

Grey, E.

Stallard, L.

Grimond, L.

Stamp, L.

Hale, L.

Stedman, B.

Hampton, L.

Stoddart of Swindon, L.

Hanworth, V.

Stone, L.

Hatch of Lusby, L.

Strabolgi, L.

Houghton of Sowerby, L.

Strauss, L.

Howie of Troon, L.

Taylor of Blackburn, L.

Hughes, L.

Taylor of Mansfield, L.

Hunter of Newington, L.

Tordoff, L.

Ilchester, E.

Underhill, L.

Irving of Dartford, L.

Wallace of Coslany, L.

Jacobson, L.

Walston, L.

Jacques, L.

Wedderburn of Charlton, L.

Jeger, B.

Whaddon, L.

Jenkins of Putney, L.

White, B.

John-Mackie, L.

Wilson of Langside, L.

Kagan, L.

NOT-CONTENTS

Alexander of Tunis, E.

Duncan-Sandys, L.

Allerton, L.

Effingham, E.

Alport, L.

Ellenborough, L.

Ampthill, L.

Elliot of Harwood, B.

Annan, L.

Elton, L.

Avon, E.

Faithfull, B.

Bauer, L.

Ferrers, E.

Belhaven and Stenton, L.

Fortescue, E.

Bellwin, L.

Fraser of Kilmorack, L.

Beloff, L.

Gainford, L.

Belstead, L.

Gardner of Parkes, B.

Berkeley, B.

Glanusk, L.

Blake, L.

Glasgow, E.

Brookes, L.

Glenkinglas, L.

Caithness, E.

Gray of Contin, L.

Campbell of Alloway, L.

Gridley, L.

Carnegy of Lour, B.

Hailsham of Saint

Cathcart, E.

Marylebone, L.

Cayzer, L.

Harvey of Prestbury, L.

Chelwood, L.

Henley, L.

Chesham, L.

Hives, L.

Clitheroe, L.

Home of the Hirsel, L.

Cockfield, L.

Hood, V.

Coleraine, L.

Kaberry of Adel, L.

Cork and Orrery, E.

Kilmany, L.

Cox, B.

Kinnoull, E.

Craigavon, V.

Kintore, E.

Craigton, L.

Lane-Fox, B.

Cromartie, E.

Lauderdale, E.

Daventry, V.

Long, V.

De Freyne, L.

Lucas of Chilworth, L.

Denham, L. [Teller.]

Luke, L.

Dormer, L.

Lyell, L.

Drumalbyn, L.

McFadzean, L.

147

Mackay of Clashfern, L.

Sandys, L.

Macleod of Borve, B.

Selkirk, E.

Marley, L.

Sempill, Ly.

Masham of Ilton, B.

Sharples, B.

Merrivale, L.

Skelmersdale, L.

Mersey, V.

Spens, L.

Mills, V.

Stodart of Leaston, L.

Molson, L.

Strathcona and Mount Royal,

Montgomery of Alamein, V.

L.

Morris, L.

Suffield, L.

Mottistone, L.

Swansea, L.

Mowbray and Stourton, L.

Swinton, E. [Teller.]

Murton of Lindisfarne, L.

Thomas of Swynnerton, L.

Nugent of Guildford, L.

Torphichen, L.

Orkney, E.

Tranmire, L.

Orr-Ewing, L.

Trefgarne, L.

Pender, L.

Trumpington, B.

Peyton of Yeovil, L.

Westbury, L.

Renton, L.

Whitelaw, V.

St. Davids, V.

Windlesham, L.

Salisbury, M.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
3.45 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 2:
Page 1, line 15, leave out sub-paragraph (iii).
The noble Lord said: This sub-paragraph deals with the increase of the maximum discount from 50 per cent. to 60 per cent. The argument follows closely upon that of the previous amendment. The difficulty about this change to the 1980 Act is to decide the economic justification for an increase from 50 per cent. to 60 per cent. discount on the purchase price of the house. It is accepted that only those who have a long tenancy will be able to benefit from the 60 per cent. reduction. On the other hand, it has been admitted by the Minister, and is also, I believe, in the memorandum to the Bill, that there are likely to be very few additional sales because of the fact that the discount has been increased to 60 per cent. Most of the people likely to wish to purchase their house and falling within the category that would give them this very large discount would have already applied to purchase the house. The economic justification is difficult to understand, while the task of finding a replacement in the market for let property becomes even more onerous for local authorities.
The Minister claims that the Labour Party has always been opposed to the sale of council houses. My noble friend Lord Ross of Marnock has made clear that we have never been opposed in principle to the idea of selling local authority housing. My noble friend has stated that he gave discretion to local authorities when he was Secretary of State. It is important that the public should realise that. All else being equal, if a local authority believes that it is good policy and that it has a sufficient number of properties in its housing stock to enable it to allow people to buy, we look forward to the day when this can be done on a really big scale.
In the statistics that the Minister kindly sent me following the Second Reading debate, it is clear, as I have stated several times, that the best of the houses—the semi-detached and the terraced houses—would be those that would be purchased. These constitute nearly all the houses that will qualify for the highest rate, the 60 per cent. rate, of discount.
By the nature of things, these are the types of houses that tended to be built in large numbers between the wars and were of a high standard, particularly in West Scotland. Of all the houses sold in Scotland in the period covered by the statistical bulletin dated February 1984, 87½ per cent. were of this type. They are the houses that will most likely qualify for the full 60 per cent. discount.
It is perhaps not a major point, when one has already reached 50 per cent., to add another 10 per cent. In fact, the Minister has already stated that he does not think that it will increase sales. We are therefore entitled to ask why the Government are giving an additional 10 per cent. discount to sell the best and most desirable of housing stock, the sort of houses for which many people have submitted transfer applications. So if we take these houses off the house letting market it will increase the despair of people who are living in other types of housing whose goal or dream for many, many years may have been to get an end terrace house, a good terrace house or semi-detached house. The Minister and the Government have just discouraged them that bit more by increasing the discount from 50 per cent. to 60 per cent. I shall be interested to hear the Minister's reasons for this and whether he believes that as a result of the Bill there will be a big increase in the sale of houses in this category. I should also like to know whether or not he thinks that this is a bad thing for the other tenants who are awaiting better housing. I beg to move.
Lord Wilson of Langside: I should like to support the amendment. In the course of our discussions on this matter, both during Second Reading and so far today, a good deal has been said on behalf of the Government about the position of a private tenant sitting on his lease and seeking to purchase the house of which he has the tenancy. I should have thought that it would be quite a simple matter to put before the Committee some evidence—for example, the views of valuers—as to the kind of discount which would be regarded as appropriate within certain limits.
We have had no evidence put to us at all to justify the basis upon which discounting is allowed in the Bill. I should like to ask the Minister whether he has made any effort to seek expert advice which would justify the stand which the Government have taken.
Lord Mackie of Benshie: As I understood the Minister's argument as regards the debate on the last amendment, he said to me, first, that any house which had a secure tenant in it and which was in private hands would have a discount if it was sold—the difference being that the private landlord is not bound to sell it; he can wait and see whether he can secure the whole value for his property when the tenant dies or moves out. The second point which the Minister made, and which I thought was quite a good one, was that if, by greater discount, one could sell more houses, one could then use that money to build houses like, for example, my pet houses—namely, houses for retired farm workers.
I have worked from some rough figures. If we sold 40,000 houses in Scotland which were valued at only £10,000, the amount appears to come to some £400 million. If we are going to give an extra 10 per cent.

149
away, the figure comes to £40 million. How many houses would we need to sell at ever increasing discounts to make up that £40 million? I am sure that the Minister's department is absolutely stuffed with statisticians who have worked this out, and I would like to hear the figure. I must say that up until now I am wholly unconvinced that the argument is correct.
The Earl of Selkirk: I find it rather difficult to become emotionally aroused either by the amendment which was put forward by the noble Lord, Lord Ross, or the amendment which has been put forward by the noble Lord, Lord Carmichael. What are we trying to do in this Bill? We are trying to do something that is absolutely essential for Scotland. Roughly 85 per cent. of people in this country want to own their own houses. To a great extent after the First World War, councils were called on to build big housing estates and. by and large, I agree that they did a magnificent job. But today, after the Second World War, people want their own homes and they are less keen on council houses. The Government have quite rightly put emphasis on trying to help people buy their own houses. I honestly do not feel wildly excited about whether it is to be two or three years, or 50 per cent. or 60 per cent. What I am concerned about is that it is successful and that people get their own houses to live in. That is what matters. With great respect, I am unable to get highly emotionally excited about either of these two amendments.
3.55 p.m.
Lord Gray of Contin: The improvement to the right to buy, increasing the maximum discount to which tenants are entitled from 50 per cent. to 60 per cent., will enable more tenants of long standing—many of them nearing the end of their working lives or already perhaps in retirement—to buy at prices which fairly reflect their tenancy record and the resources likely to be available to them.
Section (1)(5) of the 1980 Act provides that a tenant who has the right to buy shall be entitled to a basic discount of 33 per cent. after three years' tenancy—other provisions in the Bill will amend this to 32 per cent. after two years' tenancy—plus an additional 1 per cent. discount for each year of continuous occupation in excess of the qualifying period, up to a maximum discount of 50 per cent. of the market value of his house after 20 years' tenancy. We have now come to believe that the present rules do not adequately recognise the position of a substantial category of tenants—namely, those who have been public sector tenants for more than 20 years. Such tenants will generally be well on in their working lives and the amount of discount may be crucial to their decision whether or not to buy.
Clause l(l)(b)(iii) proposes therefore that the maximum discount should be increased from the present 50 per cent. after 20 years' tenancy to a new maximum of 60 per cent. after 30 or more years' tenancy, by increments of 1 per cent. for each intervening year. The new maximum discount will be of particular help to older tenants wishing to buy, and recognises the contribution that they have made to the maintenance of their home over a period of years.
150
I believe that tenants have a right not only to buy their own homes, but to buy at a price which reflects the substantial contribution which they have made to the costs of their housing over a period of years. It is only fair that the discount which tenants receive should reflect their tenancy record and this is why we have decided further to extend the discount scale. The noble Lord, Lord Carmichael, said that this added to the problem of those on waiting lists. But if tenants do not buy their homes, the evidence is that they would remain renting, generally for a considerable number of years, and the house would not become available for reletting on a time scale which is relevant to the prospects of those who are seeking houses or transfers in the immediate or medium term. So the fact that somebody does not buy does not mean that that person is going to move; it means that that house will not be available to anybody.
The noble and learned Lord, Lord Wilson of Langside, asked about what expert opinion we have taken. He asked whether we had taken the views of valuers as regards discount. I have to take a national view on this matter. The basic level of discount reflects the value of the house because of the sitting tenant, and we took a judgment on that in 1980. In other words, if we could have the house available empty, its value would be vastly different from the value we can expect for it with a sitting tenant. The contribution of the tenant by way of rents has also to be taken into account. Therefore, we take the view that where somebody has been a tenant for a long time and has been a good tenant, then that record should be reflected in the terms which are offered to that tenant as far as purchase is concerned.
Lord Ross of Marnock: How on earth can the noble Lord say that and give someone a 32 per cent. discount after two years? In two years what contribution has someone made to the maintenance of that house?
Lord Gray of Contin: The point is that someone who is an early tenant should not be put at a tremendous disadvantage. He or she should not have to think, "I cannot possibly purchase this house for 10 or 20 years". It is reasonable that, once someone becomes a local authority tenant and if the policy is to sell local authority houses, that person should not be unfairly treated because he or she has been a tenant for only a short time. It is equally important that a tenant who has been a tenant for a long time, and who has been a good tenant, should have terms offered to him or to her which reflect the quality of his or her tenancy.
Lord Ross of Marnock: But the Minister actually said that they took into account the contribution that had been made by way of the rent paid by the tenant. What would two years effectively mean in respect of a discount?
Lord Gray of Contin: As I have already explained to the noble Lord, we do not consider it reasonable to put new tenants, or relatively new tenants, at a very great disadvantage. They should be entitled to an incentive. Earlier the noble Lord said that he had no objection to the sale of council houses, and perhaps he has no objection in principle to the sale of council houses.

151
But, with the greatest respect to the noble Lord, neither he nor his party, when in Government, did anything whatever to encourage tenants to buy. That is the difference in the attitudes of this Government and of the party opposite, in that we are doing everything we can to make it easy for tenants of local authority houses to purchase their houses. There is a very great difference between paying lip-service to the principle of selling council houses and putting that principle into practice. We are putting it into practice. With respect, the noble Lord paid lip-service to it.
Lord Mackie of Benshie: Perhaps the noble Lord, Lord Gray, can clarify a point. He used the phrase, "if a tenant has been a good tenant". Does that mean that a 30-year tenant who has not been a good tenant does not get the discount?
Lord Gray of Contin: No. The noble Lord must not put words into my mouth. I was trying to explain that if a tenant has a good record, he or she should have the opportunity to see the contribution which he or she has made, by way of regularly keeping up with his or her rent and so making a valuable contribution, reflected in the price which he or she will pay for the house. That is all I said. I shall not be drawn into the argument about whether or not a bad tenant should have the same privileges.
Lord Ross of Marnock: But he has.
Lord Gray of Contin: All right. I think that it is highly unlikely that a bad tenant would actually seek to purchase his house, because most local authority experience is that the bad tenants are not the sort of people with a community spirit who might be tempted to purchase their own houses.
Lord Hughes: Will the Minister give way on this point? I am sorry to interrupt him, but where in the legislation is any discretion given to the local authority which refuses to sell on the basis that the tenant has obviously and admittedly been a bad tenant?
Lord Gray of Contin: I have to keep talking for a little while until I receive the answer to that from the Box..
Lord Hughes: I suggest that the noble Lord will still be talking tomorrow before he receives that answer.
Lord Gray of Contin: In lieu of an answer from my advisers, I can only repeat what I have already said to the noble Lord, Lord Ross; I suggest that it is highly unlikely that a tenant of the type referred to by the noble Lord would be in the position of seeking to purchase a house. However, I am sure that if we can keep this little debate going for a few more minutes, I shall have the proper answer for the noble Lord.
Lord Kirkhill: I merely want to ask one question. Can the noble Lord possibly define, or attempt to define, what he means by a "bad" tenant? As I understand the experience of most local authorities in Scotland, it is that, as a result of this Government's policy, houses in the more desirable areas have sold
152
reasonably well, but houses in areas which are somewhat disadvantaged do not sell. Therefore, at the very least, this policy is socially divisive. At any rate, can the noble Lord tell me what he means by a "bad" tenant?
Lord Gray of Contin: The noble Lord has considerable experience of local government, and I am sure that he is able to put his own interpretation on what a "bad" tenant might be. But I do not agree with his last comment that this is a socially divisive policy. It is anything but a socially divisive policy. Although it is true to say as regards sales that the more popular houses have been the older houses and the houses in perhaps more desirable municipal areas, they are by no means the only houses involved. Indeed, in both Glasgow and Edinburgh, in what one might not perhaps consider to be the most attractive municipal areas, there are cases where houses have been purchased, which is an encouraging sign. There are people who are prepared to make purchases of those houses.
In order to try to answer the noble Lord, Lord Hughes, perhaps I may now read the note which has been sent to me. The legislation does not prescribe the type of tenant who may buy his house, but only good tenants are likely to wish to buy. That fully confirms what I have already said. I am grateful that I was on the right line of thinking.
Lord Tordoff: Is the noble Lord saying that those tenants who buy are good tenants and those who do not are bad tenants? Is that what he is trying to say to the Committee?
Lord Gray of Contin: I am not suggesting that for one moment. I am suggesting that the type of tenant who is community spirited, who is aware of the privilege which he has had in having a municipally-owned house for which he has paid rent, is certainly the most likely person to wish to purchase that house. Two types of purchasers live in municipally-owned houses. Type A is the person who wishes to purchase the dwelling which he occupies. Type B uses his years as a tenant of a municipally-owned house and during those years he looks for and seeks to purchase a private dwelling outside. Both those categories of tenants are community-minded and are the type of tenants who are likely to purchase their houses. I shall not attempt to define a "bad tenant", but we all have our own ideas of what bad tenants might be.
Lord Mackie of Benshie: Perhaps I may define it in this way: a good tenant will get the discount and deserve it, but a bad tenant will not deserve the discount but will nevertheless get it.
Lord Gray of Contin: I suppose that if the bad tenant can manage to raise the wherewithal to make the purchase he will benefit by the goodwill of the local authority and the fact that initially all tenants will be looked upon as good tenants. However, if he is a bad tenant it might be to the local authority's great advantage if he does buy his house, for it would relieve them of a great burden.
Lady Saltoun: I was about to say precisely what the noble Lord, Lord Gray of Contin, has just said. If I had a bad tenant I should be only too thankful to sell to him and get rid of him as a tenant.
Lord Wilson of Langside: I do not grudge the Minister his party political fisticuffs with the noble Lord, Lord Ross of Marnock; they add to the general enjoyment of the scene. I assure the noble Earl, Lord Selkirk, that I am not at all emotionally involved in this; in this context one's emotions do not get aroused a great deal. However, I was trying to find out on what basis and upon what principle of valuation, if any, the Government proceeded in reaching the conclusion that these discounts were appropriate in this Bill.
Lord Gray of Contin: I must apologise to the noble and learned Lord in that I think I failed to answer fully one of his earlier points. As I now have the information for which he asked, I shall try to give it to him. His point, which was a point also raised by the noble Lord, Lord Ross of Marnock, was: what contribution had the tenant of two years' standing made, particularly rent-wise? One must accept that after two years the tenant has not made a major contribution by way of rental. But the fact that a house has a sitting tenant reduces its market value by about 30 per cent. and even, perhaps, considerably more, so that it really does not matter in that context how long the tenant has been a tenant; the fact that he is a tenant of the house certainly reduces very substantially the value of the house. I think that we—
Lord Hughes: Would the noble Lord the Minister give way on this point? I promise that I will not interrupt again. He has just said, as a justification for the two years, that where a house is tenanted it reduces the value by 30 per cent. I have not had any evidence that in the private market the extent to which the value is diminished is affected in any way whatsoever by the length of the tenancy. You do not find that a house in the private market is diminished by 30 per cent. because the person has been a tenant for only two years, but it becomes 40 per cent. or 50 per cent. because he has been there longer.
Having said that, when the noble Lord the Minister spoke earlier in reply to my previous question he said that the Government had taken advice. Presumably, if they had taken advice, the 50 per cent. maximum and the three-year minimum were based on the advice which they received at that time. Have they now received new advice indicating that the people who advised them last time were wrong and it ought to be two years and 60 per cent.? Because when the noble Lord, Lord Mackie of Benshie, asked what kind of professional advice they had sought, the noble Lord the Minister did not answer; he did not say anything about the quality of the advice, or from whom it was received. Can we now have an answer as to who gave the advice in the beginning, whether the 50 per cent. was based on that advice, and whether new advice has been given which would justify 60 per cent.?
Lord Gray of Contin: I am afraid that the noble Lord is unintentionally misrepresenting what I said. He is using the analogy of the house in the private sector which is privately occupied and which is going to be
154
sold. That has nothing to do with what I have said. What I was explaining in my argument was that if a house which was privately owned but tenanted in the private sector was going to be sold, then that house would not have the same value as it would have if it was being exposed without a tenant. That is the point I made. I was not talking about a house in the private sector which is already owned. That is a major difference; we are not talking about the same thing. The house which is privately owned by a landlord in the private sector but which is let to a tenant does not have anything like the value on the open market which that house would have if it were being sold without a tenant. That is the point I was making.
I am sorry, but I know that the last thing the noble Lord, Lord Hughes, would wish to do would be to misrepresent what I said. I think it right to put the record straight on that point. That was the example I was giving.
Lord Ross of Marnock: Since my noble friend says he is not going to intervene again, may I intervene on his behalf? Where there is a house in the private sector which is valued with a sitting tenant, what difference does it make to the valuation whether that tenant has been sitting there as a tenant for two, three, ten, 20 or 30 years? It does not make any difference at all.
Lord Gray of Contin: I accept part of what the noble Lord says, but it is surely reasonable, whether we are talking about publicly-owned or privately-owned houses—
Lord Ross of Marnock: Privately-owned houses.
Lord Gray of Contin: Whichever it is, it is not unreasonable that the person who has been a tenant for 20 or 30 years should receive a special benefit.
Lord Ross of Marnock: No.
Lord Gray of Contin: The noble Lord is suggesting that they should receive no consideration because they have been good tenants?
Lord Ross of Marnock: They do not from the point of view of an objective valuation of the house, and that is what we are seeking—an objective and open market valuation of the house. Whether the tenant has been there for 10 or 15 years does not matter at all; the valuation of the house with the sitting tenant remains the same.
Lord Gray of Contin: The valuation of the house with the sitting tenant remains, as I said, very much less than it would be without a sitting tenant, but it is at the discretion of any Government to suggest—
Lord Ross of Marnock: I am not talking about any Government.
Lord Gray of Contin: Very well; the noble Lord is not talking about any Government. Let us go back to the private sector. If the noble Lord, Lord Ross, was a large landlord who had a great many houses which were all tenanted and he wanted to dispose of them, would he not, out of the goodness of his heart, think it

155
was a reasonable incentive to give an encouragement to his tenants, who had been his good tenants for 30 years? I cannot believe that the noble Lord would take other than that view.
Lord Ross of Marnock: They are giving them away for nothing.
Lord Gray of Contin: I think we have dealt with this amendment in some depth. I do not think I can agree to accept it. I do not believe that it is desirable to accept it, and I ask the noble Lord, Lord Carmichael, whether he will consider withdrawing it.
Lord Mackie of Benshie: I am terribly sorry, but I did a calculation and asked for a comment upon how many more houses needed to be sold to justify the drop of £40 million in receipts.
Lord Gray of Contin: I apologise to the noble Lord, Lord Mackie, and I am sorry I did not deal with that. It seems that the answer to his mathematical conundrum has not been provided for me, and I shall therefore write to the noble Lord in due course.
Lord Carmichael of Kelvingrove: This has been an interesting debate in that we have realised there is really no justification whatsoever for increasing the discount from 50 to 60 per cent. While I can appreciate the point made by the noble Earl, Lord Selkirk, that he is not really concerned and he could not find any emotional involvement in it, I think the point which it is important to appreciate—and I am sure he knows this at least as well as I do—is that one of the major problems in Scotland has been the type of industry we have had (the whole Clyde estuary and the Dundee area have always been areas of hunger and poverty) as well as the mobility of labour required. Because of that, as my noble friend Lord Ross of Marnock said, very few people had jobs of long or steady tenure. That is one of the reasons why there was never the same house ownership in Scotland as there was in other parts of the country.
I think I really must make one comment on what the noble Lord the Minister said about long tenancies. I think some of his earlier statements are statements which we have all heard from him and from many of his right honourable friends in other places. I refer to when he spoke about the value of rental contributions made by people who have been in local authority houses for 30 years. In another place and in general throughout the country the party opposite have always spoken about the rents of highly-subsidised tenants. When he said that it struck me that he was perhaps contradicting some of his earlier statements. There was one famous Member of another place who described tenants as second-class citizens. This has tended to be one of the ways in which they were considered by many people in the party of the noble Lord the Minister.
Part of the reason for our not being anxious to sell what has still not been proved otherwise than the best houses—those are the two in the block or the terrace houses—is that people come to surgeries (and the noble Lord has probably had as many as I have) desperate to find a more suitable house in a better area,
156
but such houses are now disappearing. To the noble Earl, Lord Selkirk, I would say that emotion is involved. People who have been extremely good tenants in an area that is unsuitable for them or an area which is not the type of place they wanted to live and who have set their minds on something else, partly because of this policy find that their chances have been put back even further.
We have no objections. I keep saying that. If there are enough good houses, we have no objection to selling off local authority houses. We appreciate that the waiting lists are still very high. I, too, am interested in the mathematics and, like the noble Lord, Lord Mackie of Benshie, will be very interested to hear the results of the mathematics because any of the estimates that I have had from concerns such as Shelter prove that little benefit will come as regards the local authority. In fact there will be a disbenefit from the increasing of the discount to 60 per cent. The local authorities will have to find more money to meet the needs of the growing waiting list of people, anxious for better houses. I should like to hear whether the Minister has any more to say on this before making a decision on whether to withdraw.
On Question, amendment negatived.
4.22 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 3:
Page 2, line 1, leave out paragraph (c).
The noble Lord said: Amendment No. 3 deals with a paragraph which I am sure will delight the heart of the noble Earl, Lord Selkirk. This is where we seek to leave out paragraph (c). If he can tell me what paragraph (c) means, then he is a better man than I am; but he does not.
The Earl of Selkirk: No, I do not.
Lord Ross of Marnock: It starts with "occupation", and we already know that to know what that means we must return to the previous Bill. I should tell him that "occupation" is defined in relation to "a secure tenancy" so that one jumps from "occupation" to "a secure tenancy". Why "a secure tenancy" was not used in the first place I do not know. But after we have heard about the good tenants, the "black" tenants and the "grey" tenants—well, well! I do not think it was the happiest of half hours that the noble Lord, Lord Gray of Contin, has had since he joined the Scottish Office.
This is a probing amendment. The paragraph does not mean a thing to anybody. It says:
"in paragraph (iii) of the definition of 'occupation' in subsection (12) (interpretation) the words 'in the discretion of the landlord,' are hereby repealed".
One has to be careful about this, because in that definition one finds not only the words "in the discretion of the landlord", but "at the discretion of the landlord". They are left in; not taken out.
I want to know from the Minister whether that is deliberate. For the benefit of the Committtee—which is anxious to hear him again; after his lucid explanations of the last half hour or so, we are dying to hear him speak again—can he tell us what all this means? I beg to move.
Lord Gray of Contin: I shall do my best to try to explain to the noble Lord. Whether I shall be successful remains to be seen.
Under Section 1(12) of the Tenants' Rights, Etc. (Scotland) Act 1980, housing authorities have discretion to allow a child who has succeeded a parent as a tenant of a public sector house to count towards the qualifying period for the right to buy and towards his discount entitlement any periods during which, since the age of 16, he occupied a public sector house of which his parent was the tenant.
This discretionary power was included in the 1980 Act in order to ensure that grown-up children who remain in the parental home in order to look after elderly or disabled parents (and who are in practice the tenant in all but name) are treated no less favourably with regard to the right to buy than if they had left the parental home and obtained a tenancy of their own.
Unfortunately, some authorities have abused this discretionary power by refusing to exercise it even in the most deserving cases. A small number of authorities which have consistently opposed the right to buy appear to have taken a decision that they would never exercise this discretion in any circumstances.
These authorities are clearly not exercising their discretion in the spirit which was intended. This has created disparity of treatment between tenants in different authorities, even though their circumstances may be similar. Tenants justifiably feel a sense of grievance when they find that their landlord refuses to exercise this discretion reasonably.
This is why we have decided that the discretion should be replaced by a requirement to count time spent as the child of a tenant. This will remove the present abuses in the system and ensure that all tenants in future are treated equally. The effect of the present amendment, however, would be to reverse this and to preserve the status quo, whereby authorities have complete discretion. There is no evidence that authorities which have behaved unreasonably in the past will suffer any change of heart. I hope, therefore, in view of that explanation, that the noble Lord will be prepared to withdraw the amendment.
Lord Ross of Marnock: I had hoped to have an explanation. I have had an explanation of sorts, but it is not a full explanation. I referred to the inclusion of the words "at the discretion" and the words "in the discretion" of the local authority. I wondered why the second "discretion" of the local authority was not removed. I wondered how this would work, if it is to work at all, under this now amended clause. I have here the original, but I do not want to be long winded.
I know that the Minister of State is new to housing and new to the intricacies of the Scottish Office, but I believe that the last thing we want to do is to take away any further discretion from a local authority. If a local authority is not fairly exercising a discretion, surely it is correct to give a right of appeal to the Secretary of State, the Lands Tribunal, the land court or the sheriff. That would be better than placing a blanket option on a local authority by taking away its discretion. There may be cases where a local authority is right to refuse permission in relation to its conditions about length of reckonable tenancy. Let us remember that we are dealing with a secure tenant; a child or someone who
158
has already been given a tenancy by the local authority. As I understand it, it is a question of how many years' reckonable tenancy is allowed for the purposes of discount. Here it is to be from the age of 16. Why 16 I do not know; such a child has not been paying a rent from the age of 16 so that this tenderness towards the former subsidised tenants that we used to hear about surely does not apply to a child of 16.
No one can have the right to buy unless he is a secure tenant. What we are dealing with here is not the secure tenancy or the right to buy; we are dealing with the conditions under which he buys and as to whether a child should be able to count the years from the age of 16.
All sorts of conditions arise in this connection. The child may go away to look for a job in London and he may be away for four years, but his permanent address may still be the council house where his parents live. The people who really know what has been going on are the local authorities and that is why I presume the Government in the first instance decided that they should have the discretion. I would plead with the Government to think about this once again. The last thing you should do is to take away what little discretion a local authority has left. If you are going to modify the discretion, modify it with the right of appeal of somebody objecting to it. I think it is the Lands Tribunal which deals with all the other disputes and you could have given them that right of appeal. However, I am not pressing this at the present time. I shall read every word of the explanation that has been given before the next stage.
Lord Howie of Troon: Before my noble friend sits down, would he comment on something which struck me on listening to the explanation by the noble Lord, Lord Gray of Contin? Perhaps I did not understand the explanation fully, but it seemed to me he was saying that this kind of tenancy was appropriate where a young person had been looking after an aged parent or something of that sort.
Lord Ross of Marnock: Not necessarily young; just a child.
Lord Howie of Troon: Exactly; but starting from 16 and then onwards he had been looking after an aged parent, so he could be regarded as the tenant in name. That strikes me as a quite admirable qualification for this kind of thing, but I was wondering whether the Bill as it stands really limits that arrangement to such a person or whether it applies to any person who has been in a council house since the age of 16, regardless of whether or not he has been looking after an aged parent or something of that sort.
Lord Ross of Marnock: My noble friend must get used to the fact that I am not Secretary of State and I am not here to answer his questions about what the Bill says and what it does not say. I could tell him, but I think I will leave that. This is something that the noble Lord, Lord Gray of Contin, will not be able to get wrong, so I will leave it to him to reply to that particular point.
Lord Gray of Contin: The noble Lord, Lord Ross of Marnock, is as charming as ever. I shall try to answer

159
the further points that have been raised. First, the noble Lord, Lord Howie, raised an interesting point. What I should like to try to explain is that some authorities were not choosing to exercise the discretion as a discretion. They were refusing to exercise it in any circumstances, irrespective of the case, and that is not a proper use of a discretionary power.
Clause 1(1)(c) of the Bill amends Section 12(3) of the 1980 Act and repeals the discretion that councils have at present to count time spent as the child of a tenant. The section has no effect on the subsequent provision that landlords may at their discretion overlook a break in tenancy of between one and two years. This discretion is not changed. What we are doing here is to try to ensure that the years spent as the child of a tenant shall count, and it is quite a simple measure to try to make sure that this is effective. The noble Lord, Lord Ross, has indicated that this is a probing amendment and that he will not seek to press it. I know he will read carefully what I have said, and doubtless at a later date he will come back to it.
Lord Ross of Marnock: The noble Lord has not dealt with the definition as to "child" and the question of someone else coming into the house to look after the old people. I do not want to answer that and I left it specifically for the noble Lord, Lord Gray, to answer.
Lord Gray of Contin: This does not deal with anybody else. It deals specifically with the child of a tenant and the years spent as the child of the tenant. It does not deal with anybody else in that situation.
Lord Howie of Troon: I think I understand that. What I was really getting at was the situation quite rightly drawn attention to by the noble Lord the Minister. He was talking of people who were there for a specific humanitarian purpose and of how he thought the change in the law would be advantageous to them, whereas the manner in which local authorities were now exercising their powers was not. I agree with him about that. What I was really asking was this. Would the new arrangements be limited to people who were doing the good things that he spoke of, or would it be more widespread than that?
Let me put it like this. I myself was the child of a tenant in a council house from, I think, 1929 until 1958 and was over 16 at the end of that time. I was wondering whether this would perhaps apply to me. I am still the child of a tenant of a council house, but I have not lived there myself for quite a while. I wonder where such a person as I would stand. I thought that in his remarks the noble Lord limited the right to people who were there looking after their parents. I quite understand and approve of that, but I was wondering whether the Bill limits the rights to such people or whether it is a right in general to people over the age of 16.
Lord Gray of Contin: Our intention in the Bill is merely to replace the present discretion to count time spent as the child of the tenant by an obligation to do so. We are not proposing to extend the categories of relatives who can qualify to include, for example, grandchildren, nephews or nieces. If one started to
160
redraw the line in this way there would always be some other group which was narrowly excluded. I think the present position is seen to be fair and I would not favour changing it.
Lord Howie of Troon: Yes, I quite accept that and I quite approve of the Government's intention to remove the discretion. What I am really worrying about is the relevance of the Minister's argument about children looking after aged parents. Is that in fact relevant to the argument, or is it not? If it had been relevant to the argument I would have thought that the rights would be limited to such people, but as they appear not to be limited to such people I am wondering what the particular relevance of that argument is.
Lord Gray of Contin: The provisions are limited to humanitarian cases: any child will benefit. However, I do not think the noble Lord could benefit because he has had a break in tenancy and therefore he would not qualify.
Lord Ross of Marnock: With all due respect, the noble Lord would qualify, provided, first, that he is given the tenancy in succession by the local authority, and provided, secondly, that the local authority exercise their discretion to discount interruptions of more than two years. If he likes, I will read the whole section out to him:
"(12) In this section—'occupation' means occupation … (iii) in the discretion of the landlord, as the child of a person who has succeeded to the rights of that person in a dwelling-house occupation of which would be reckonable — but only in relation to any period when the child is over the age of 16 years; and any interruption in occupation of 12 months or less shall, and any interruption in occupation of more than 12 months and less than 24 months may at the discretion of the landlord, be disregarded".
Therefore, a period of two years' interruption can be disregarded. However, the child first has to become the tenant. That depends upon the local authority accepting him as the tenant.
Obviously we are going to get nowhere on this amendment. The noble Lord, Lord Gray of Contin, did not reply to my alternative suggestion that there should be a right of appeal if the discretion has been unwisely used. I shall think about the matter and will read the noble Lord's comments. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.41 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 4:
Page 2, line 33, leave out paragraph (u).
The noble Lord said: I beg to move Amendment No. 4. This is a probing amendment. I should like to know whether the Government have any intention of increasing the number of classes. Do the Government intend time spent in a tied house to be counted as time spent in a local authority house? Are the Government thinking of extending this provision to prison houses? What other categories of house are included in the "catch all" provision in paragraph (u):
"such other person as the Secretary of State may by order prescribe"?
May I also ask the Government whether somebody who has been occupying, for instance, an Atomic Energy Authority house will be able to obtain the tenancy of a local authority house? Will they be given credit for the time spent in an Atomic Energy Authority house? Will they qualify to be put on to the waiting list for local authority housing or, as used to be the case with tied houses in education and other jobs with the old local authorities, will the situation be that as soon as somebody obtains a job which involves living in a tied house the employer will put down that person's name on the waiting list for a local authority house? In such towns as Wick or Thurso the local authority might be shy of giving scarce housing to people working for the Atomic Energy Authority who are now living in Atomic Energy Authority houses. They will know that after they have been in local authority houses for two years they will become secure tenants and that those houses will immediately be removed from the stock of houses which they have available for letting. They might, for instance, wish to have houses available for letting to the employees of new industries coming to the area.
Could the Minister indicate how somebody qualifies for a local authority house and a secure tenancy after having been in one of these other categories of house for a certain period of time? Could the Minister also indicate whether a local authority will be compelled to provide a house which is available for letting? Does the Minister have any views upon which other categories of people the Secretary of State may by order prescribe as being able to benefit from this very important concession? I beg to move.
Lord Gray of Contin: Clause 2 extends the list in Section 1(10) of the 1980 Act of public bodies, former tenancy of whose houses can be counted by tenants of district councils, Scottish special housing associations and new town houses towards the qualifying period for the right to buy and towards discount. The basic principle upon which the list in Section 1(10) was originally constructed was that periods spent as tenants of local authorities and analogous bodies should be counted towards the benefits of the right to buy, while periods as tenants of Government departments and connected bodies should not. During the passage of the 1980 Act we accepted that there should be four exceptions to this general principle: in respect of members of the armed forces and the prison service and of employees of the Forestry Commission and health boards. These exceptions were made because tenants of these bodies are often required to occupy tied housing and in many cases are unable to arrange their own housing provision until they retire.
Since 1980 we have received frequent representations that tenants of houses provided by other central government bodies are in a similar position and should also be entitled to count their time as tenants towards the benefits of the right to buy. As my right honourable friend the Secretary of State announced during the Second Reading of this Bill in another place, we have accepted that the list in Section 1(10) of the 1980 Act should, in the interests of fairness, be extended to include a wider range of public sector bodies than it does at present.
162
The noble Lord specifically mentioned prison houses, and of course I can confirm to him that time spent in a prison house before becoming a council tenant already counts towards the right to buy and discount. This is taken care of in the 1980 Act at Section 1(10), to which I referred earlier.
The amendment refers also to Clause 2. Although we have not yet had put to us the Motion that Clause 1 shall stand part, perhaps it would be convenient if I dealt with this point by indicating that it extends the list in Section 1(10) of the 1980 Act to include a number of other bodies: the coastguard service, the lighthouse service, the United Kingdom Atomic Energy Authority, which the noble Lord also mentioned, the Ministry of Defence and the state hospitals. We know from the representations we have received that there are a number of past tenants of these bodies who are now in a position to buy and who feel that they are unfairly treated in not being allowed to count their previous tenancy of public sector houses for the benefits of discount, et cetera. Clause 2 puts this right. It may be that there are further central government bodies—and we shall be taking steps to try to identify them—which also let substantial numbers of houses that should be added to the list.
Clause 2 also proposes, therefore, that my right honourable friend the Secretary of State should be enabled to add further bodies to the list by order. This will enable us to respond positively should it emerge that there are further categories of tenants who are disadvantaged by not being included in that list. Any such order would be made by statutory instrument, subject to negative resolution.
The noble Lord's amendment would delete the proposed order-making power from the Bill and would mean that the list in Section 1(10) could be further extended only by means of primary legislation. This would inevitably introduce delay between the identification of a body which should be added to the list and the extension of the list to include that body. This, in turn, would place former tenants of such a body who wished to purchase their council house in the unenviable position of having to decide whether to delay purchasing in the hope that an opportunity for amending legislation will arise or whether to proceed with the purchase at a discount which does not take full account of their previous tenancy record. In the light of this explanation, I hope that the noble Lord, Lord Carmichael, will agree to withdraw his amendment.
Lord Mackie of Benshie: Perhaps the noble Lord will accept the logic of using this power to include non-state tenants of tied houses. There seems to be no logic at all in confining this immense privilege to people who already have the advantage of a state subsidy as against people who do not have the advantage of a state subsidy. Will the Minister confirm or deny that this might possibly be included in the powers or the thoughts of the Secretary of State?
Lord Gray of Contin: Whatever the merits of such a move might be, it could not be embraced by this legislation. I fear that it would require primary legislation of its own.
Lord Carmichael of Kelvingrove: Since the noble Lord the Minister dealt rather widely with Clause 2, perhaps he will go on to answer the question that I put to him. I asked exactly how one makes sure, if one is an Atomic Energy Authority tenant in a place such as Dounreay, that one will get a local authority house, and ensure that one's time in the AEA house will count towards the purchase. There could be an understandable reluctance on the part of a local authority to provide houses, particularly the more saleable types of houses, to people who are in tied houses, knowing that after two years they would lose them permanently from the stock.
In most cases local authorities will have waiting lists of people, and those people will wonder how it is that a newcomer can take over a house while they are still left waiting. The newcomer will be able to move into a local authority house which he can purchase in two years' time, whereas others on the list will be left waiting without an opportunity. Can the Minister give me any idea how a person in that situation can be sure of getting a local authority house? Is there some compulsion in a part of the Bill that I have not noticed?
I should apologise for including prison houses in my previous remarks. I was looking for possible additions, and had forgotten that prison houses were covered in the parent Act. I shall be very interested to hear whether the Minister can help me.
Lord Gray of Contin: I believe that I can help the noble Lord with his question about how an occupant of a tied house will secure a local authority house. Such tenants will be allowed to apply for a local authority house in the normal way, merely by putting their names on a waiting list. The local authority is required to publish its allocations policy, and it could not discriminate against former tenants of the public sector as long as they had been tenants of houses which will be added to the list about which we have been talking. That will give them the protection which the noble Lord seeks for them. It will ensure that their period of tenancy in one of those houses will count as far as the local authority is concerned. If they decided after the two-year period to purchase, then their period of public sector tenancy would also count.
Lord Howie of Troon: I am a little concerned about the reply made by the noble Lord, Lord Gray of Contin, to the intervention of the noble Lord, Lord Mackie of Benshie. The noble Lord, Lord Mackie, made a fairly firm point in general terms when he suggested that there was a very strong element of unfairness in the distinction between one kind of tied house and another in relation to the obtaining of what is quite a substantial concession in the purchase of a council house at some stage.
Like the noble Lord, Lord Mackie, I cannot see that it is fair that someone should obtain a concession merely because his tied house is an Atomic Energy Authority house in Dounreay (which was the example cited a moment ago by my noble friend Lord Carmichael) as against, for instance, a tied house not that far away on a farm, perhaps even a farm run by the noble Lord, Lord Mackie. If there is a distinction, it is only that one tied house is in the private sector and
164
the other tied house is in the public sector. That does not seem to me to be a distinction that is adequate to permit someone to enjoy a substantial concession over someone else in buying a capital property. The Minister's arguments so far have not been powerful enough to convince me. I am always ready to be convinced by strong arguments.
Lord Gray of Contin: Though it may not be powerful enough to convince the noble Lord, I am afraid it is a fact. The plain truth of the matter is that it would require primary legislation, as I said in reply to the noble Lord, Lord Mackie of Benshie. In this legislation we are dealing with local authority housing in the public sector. The noble Lords, Lord Mackie and Lord Howie, have been referring to housing in the private sector. The noble Lord, Lord Mackie, sugested that it would be a good thing to extend this provision to private sector housing. I am not in a position to go into the merits of that argument. Perhaps it would be a very good thing. I merely said that it would not be possible to do so in this particular legislation, which deals with public sector housing. That is the fact of the matter: it would not be possible to achieve that change in this legislation. It would require a new Bill for primary legislation.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Jacques): The Marshalled List inadvertently lists Amendment No. 4 as an amendment to Clause 1. In fact, it is an amendment to Clause 2. In the circumstances, I will put Clauses 1 and 2 together.
Clauses 1 and 2 agreed to.
The Deputy Chairman of Committees: Before calling Amendment No. 5 I would point out that in the third line of this Amendment as shown in the Mashalled List there appears a printing error: the word "nor" should be substituted for the word "not".
4.57 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 5:
After Clause 2, insert the following new clause
("Saving for elderly persons.
. In subsection (11) of section 1 of the 1980 Act the following shall be inserted after paragraph (c)—
("; nor
(d) where a dwelling-house is one which the local authority usually lets to elderly persons.".").
The noble Lord said: We are grateful to the noble Lord the Deputy Chairman for keeping us right. This is a rather more important amendment than some we have been discussing. We now come to the very serious question of housing old people. I have received representations from Shelter in Scotland and from Age Concern. Age Concern is still worried about the whole question of the proper provision of housing for old people; it is concerned about the right to buy provision.
Information from the 1981 Census tells us that there are 264,000 pensioners in Scotland who live alone, and the majority of them receive housing benefit.
There is not much likelihood of them being able to buy housing in the private sector; I do not know about the public sector. Also, 20,000 households headed by pensioners occupy a house without a bath. In other words, they are not council houses, but those are the conditions under which some of our most deserving old people live in Scotland. Council house sales, say Age Concern, decrease the likelihood of many pensioners getting a decent house.
The fact is that there is little discrimination in respect of the kind of houses that are sold. The only protection we have in Scotland on the prevention of the sale of houses is in respect of sheltered houses. There are only a few housing authorities in Scotland who have housed even the recommended 50 in every 1,000 old people, as used to be laid down by the SDD. That figure is met by only a handful of local authorities. So there is this great need for old people to get into the right kind of housing.
The definition of sheltered housing is such as to cover the specialised provision of these grouped houses and the existence of certain services provided by the local authority as well. But local authorities in Scotland have, over the years, been providing smaller houses, where a limited amount of climbing is involved. I know of some very good housing. It is not sheltered housing as such because it has not been adapted. There is not the provision of a caretaker or someone who will respond to alarm bells and the like, but there are little groups of houses and local authorities have, over the years, provided these houses for elderly people. I remember an uncle of mine who lived in one in Ayr. I believe there was a block of only about eight houses. What happened was that the most fit of the tenants looked after the others. It was more or less a co-operative of elderly people. They do not come under the Government's definition of sheltered houses. These houses, which consist of only about two apartments, can now be sold and no doubt many of them are. It means that each house sold is one house which is not going to be available for those who have been waiting to get in; those old people who in some places are living without a bath and who are waiting to get such a house. That surely sticks out to anyone as pure logic.
I am sorry that the noble Earl, Lord Selkirk, is not here because he did not want to get involved emotionally. I get involved emotionally with old people living in the oldest houses and towns, and I feel they have a right to get into a local authority house when we are giving credit in the form of discounts to people who have been in houses for a long time. Do not your Lordships think that we should give some credit to the older people who have been paying rates and supporting the housing of other people for a long time? Yet here we find their opportunity of being housed reduced every time a house of this type is sold.
I opened a new housing section in the new town of Irvine just a few months ago. They are putting elderly people into homes which are surrounded by a garden and are on one level. There is just a bedroom, living-room, bathroom and kitchen. They are ideal for an old couple. But those houses have no protection under present legislation. I remember saying to the person in charge that I hoped he appreciated that after the old people have been there for two years—indeed, after
166
five minutes if they have come from a local authority house—they can buy their house. The houses are most desirable in relation to the area. They are most desirable in relation to what is provided. But it is unfair, bearing in mind that they have been provided for and occupied by elderly people on a decision by the local authority because it reckoned that the houses should be occupied only by elderly people.
I know that of the households of old people in Scotland about two-thirds are single persons living alone. The local authority in Ayr has over the years had a special scheme of building two-apartment houses purely for single people. They are sometimes occupied by widows and sometimes by spinsters who have continued working, paid rates and income tax. It was realised after a long time that there is a growing population of single people like that, or of people living alone, who require consideration with regard to local authority housing. It was provided, but that housing is not protected.
The more that this kind of housing is sold the less chance have the elderly of getting such accommodation. In rural areas the position is even worse because there is not the same spread of local authority housing in such areas and they become very desirable for people who want eventually to take them over. It may be they are sold to an aged parent who immediately hands over his rights to someone who lives in the town; and so another house goes out of the stock that could have provided for the need of an elderly person.
I do not know what the Government's argument will be. We had hoped at one time that we had convinced this House that if there was a group of people which required protection we had done so in respect of the elderly. It was an English Bill in which we did it. Our will prevailed and we held matters up in another place. I know that the conditions in Scotland are such that the older people tend to live in the older houses, older houses of the kind that we have been familiar with—my noble friends Lord Hughes, Lord Howie and Lord Carmichael, and those who come from Glasgow and the area round it. We want to get the people out of those old houses and into decent houses for elderly people. And there are many such houses within the local authority sector. To allow those to be bought by sitting tenants will deprive those old people for two or three years—and it may well be just two or three years because we are talking about elderly people—of comfort and good housing in the latter part of their lives.
Therefore, the amendment is designed to ensure that where a dwelling-house is one which the local authority usually lets to elderly persons it shall not be sold. This is one of the most important amendments we have on this Bill. I am glad to see the noble Earl, Lord Selkirk, has returned to the Chamber. I do get emotionally involved in this subject because I have known so many people who need to get into these houses. I instanced an uncle of my own who was in such a house. It was a godsend for his health and for those of his own family who were looking after him, but who could not have him in their own homes. I appeal to your Lordships to give this amendment full consideration. I beg to move.
Lord Mackie of Benshie: I very strongly support this amendment. The noble Lord, Lord Ross of Marnock, has marshalled the arguments extremely well. I do not propose to repeat the case for keeping these houses, but I do hope that the Minister is not going to produce the argument which was produced to me on the original Bill; that it was a great shame that these poor old people did not have the same rights as others to buy their houses. That is arrant poppycock, if I may say so. Obviously old and retired people's houses will be bought only for the commercial advantage of the family or of someone else who will provide the money. That is the only possible scenario in which old people will buy a house specifically let by the housing authority to old people.
I make this point very, very stongly indeed. In rural areas there is the further temptation that the house can be used as a holiday home by the family, or indeed sold as such, when the new owner dies. That is the strongest argument for an amendment at this stage of the Bill. I hope that we shall have a logical, and indeed favourable, reply from the Minister.
5.10 p.m.
Lady Saltoun: I do not support this amendment. Although on the face of it it is very tempting to do so, I am afraid that I cannot agree with the noble Lord, Lord Mackie of Benshie, that pensioners would wish to buy their houses only in order to sell them again at a profit or because their heirs wished to do so. A great many pensioners may wish very much to own their houses, particularly in view of the fact that a man becomes a pensioner at the age of 65 and he may very well have 20 years or more of active life ahead of him.
I wonder whether it would be possible for local authorities to sell houses usually let to elderly persons to the tenants but to retain the right of pre-emption. That would mean that in the event of a re-sale the local authority must be offered first refusal. In that event possibly the price which the local authority would have to pay to re-purchase the house should be the original price plus inflation.
Lord Howie of Troon: I am strongly attracted to this amendment. Despite the proposal made by the noble Lady, Lady Saltoun, I incline towards the arguments of the noble Lord, Lord Mackie of Benshie, in addition to those of my noble friend Lord Ross of Marnock. I look at the matter emotionally, somewhat as my noble friend does. I shall draw my illustrations not from Ayr, which I know rather well, but from Troon, which I know better. My wife's mother is 85 and lives in a sheltered house in Troon. It is accommodation provided for old people and remains protected under the provisions of the Act. She cannot buy the house and therefore it will remain in the stock available for letting to old and retired people in the way that my noble friend, myself and the Government regard as desirable.
About 250 yards away in a non-sheltered council house lives my father. He is 90. He shares the same amenities as my wife's mother of a luncheon room and all that kind of thing. Her house is sheltered and protected; his house is not. If he were so inclined, he could buy this house, remove it from the stock and inflict the precise damage on the prospects of other old
168
people in the vicinity to which my noble friend has drawn attention. If my father were the kind of person at whom the noble Lord, Lord Mackie, pointed the finger, he might leave the house to me or use it or sell it as a holiday home. He would not do that because he is not that kind of man; but in theory he could do so. The noble Lord, Lord Mackie, is undoubtedly right. If he were to buy the house he would remove it from the stock of housing available for other retired and old people in Troon. It seems extraordinary that my wife's mother cannot remove her house from the stock of housing available to retired and elderly people—which is right—whereas my father, who lives all of 250 yards away, can do so.
As my noble friend Lord Ross said, it is a very strong amendment. It is strong because it is intended to protect the opportunities for old and retired people to get a council house because the stock is maintained at a certain size. I am not saying that the stock should never be diminished, but every house of this kind which is removed from it diminishes the opportunities for certain old people. My noble friend is right to be emotional and to move his amendment and I think that the Committee should suppport it.
Lord Gray of Contin: This new clause is very sweeping in its effects. It would not only remove the right to buy from most elderly tenants; it would also remove the right from anyone who happened to live in a house which the authority could claim was ordinarily let to elderly persons. As a result, almost all one-apartment or two-apartment houses in Scotland might be excluded from the right to buy.
The new clause is both undesirable and unnecessary, and I shall try to explain to your Lordships why this is so. The 1980 Act already does all that is necessary to enable authorities to preserve a stock of sheltered and amenity housing for elderly people, as indeed they must be permitted to do. Under the 1980 Act, sheltered housing is wholly excluded from the right to buy. If tenants were allowed to buy individual sheltered houses, this could undermine the viability of such schemes, which will have been designed as a unit with a warden and an alarm service.
Special needs housing for the elderly—where the houses do not form part of a sheltered housing development—is a rather different case. The sale of such houses is not of immediate consequence to other tenants. Such houses are likely, however, to have been built or adapted with special features for elderly people, and Section 4 of the 1980 Act enables an authority —and this will satisfy the point raised by the noble Lady, Lady Saltoun—to impose a pre-emption condition on the sale of such houses which will allow the council to buy the house back, if it wishes, when it is re-sold. In addition—
Lord Ross of Marnock: If, if! Can the noble Lord give us all the conditions in respect of that?
Lord Gray of Contin: No, I am replying to the amendment which the noble Lord moved. He moved it in his way; I hope that he will let me reply in mine. In addition, when an authority receives an application to purchase from a tenant a house which has been specially adapted for elderly people, it can, as an

169
alternative to imposing a pre-emption condition, make an application to my right honourable friend the Secretary of State under Section 3A of the 1980 Act for his consent to refuse to sell the house, so that the point which was worrying the noble Lord, Lord Mackie of Benshie, is also taken care of.
We believe that these provisions are working very well: indeed, we have certainly not received any representations to the contrary. I suggest therefore that the present legislation contains adequate safeguards to enable councils to retain a stock of houses for elderly people with special needs and that the present amendment, in view of what I have said, is unnecessary. I hope that the noble Lords, Lord Ross of Marnock and Lord Carmichael of Kelvingrove, may be prepared to withdraw their amendment.
The Earl of Selkirk: Can I ask the noble Lord one question? How does a house become a sheltered house? Who does that?
Lord Ross of Marnock: It is built as such.
Lord Gray of Contin: The noble Lord, Lord Ross, said himself that we must get used to the fact that he is no longer the Secretary of State for Scotland. He answers so well for me that I cannot improve on that answer—if he is correct. It is the local authority.
The Earl of Selkirk: He has not given me the answer, though. What is the answer?
Lord Gray of Contin: The answer is that the sheltered housing is provided by local authorities.
The Earl of Selkirk: And they can make any house a sheltered accommodation, can they?
Lord Gray of Contin: They can either build purpose-built sheltered accommodation, or they can adapt existing houses suitable for old people. But the concept of sheltered accommodation is housing which is purpose built in a complex with a warden and an alarm system.
Lord Mackie of Benshie: I wonder whether the Minister would answer this question. Am I right in assuming that the County of Angus, for example—it is a district, now—built, specially for retired people, two-apartment houses, and that these houses may now be sold in spite of the fact that they have built them specially for retired people? I accept that if they are adapted for some special circumstance, they can be exempted from sale; but in my estimation there are many houses built by the local council in Angus, which in fact were built for old people and which can now be sold.
Lord Gray of Contin: Yes. I did try to cover that point when I was replying to the noble Lord. The council is able to make conditions which would enable them to have a pre-emption on the house when it was resold. They have the right of pre-emption, and the council can make that condition itself in the type of house which the noble Lord is suggesting. But the complex type of house, where there is a warden and an alarm system, is already exempted.
Lord Mackie of Benshie: Would the noble Lord the Minister explain? If the council may buy it back, do they buy it back at the new price or at the open market price, or, if they buy it back at a prearranged price, what is the point of making a condition of pre-emption? It is surely far more logical simply to keep the stock for the great need there is for it.
Lord Gray of Contin: Would the noble Lord not agree that it seems wrong to deprive an elderly person of the right to purchase his or her home, and is it not a reasonable safeguard to maintain the housing stock to include a right of pre-emption for the local authority to buy it back?
Lord Mackie of Benshie: In my original remarks, I have described that argument in a very rude way.
Lord Howie of Troon: I regret to say that I did not find the Minister's original reply totally convincing. I regret it because it seemed to me that his reply was couched in very properly sympathetic terms, and he recognised and was willing to continue to recognise the special needs of certain old people. I rejoice in that but regret that I found it did not go quite far enough to meet the point which I thought I had generally made. I was not in fact talking about housing for old people which was adapted in any special way; I see that he understands their needs perfectly well and is quite sympathetic towards them. But quite a number of old and retired people do not actually require special needs. They live in ordinary houses in an ordinary way. It was houses of that nature about which I was talking, not ones which had been specially adapted, because the ones which are specially adapted are unlikely to be bought by anybody other than people who require the special adaptions. I was talking about houses which were ordinary in every way but which could be bought and thereby taken out of the stock, and thereby diminishing the stock. I do not think the noble Lord met that point at all.
Lord Gray of Contin: Houses such as the noble Lord describes can be sold. They come into the normal conditions. If they have not been adapted, if they are merely houses which are occupied by old persons, then they can be sold in the normal way. I do not want to go into the details again. I have already described the two different types of either complex, sheltered housing or adapted houses.
Lord Howie of Troon: Yes, they come in very close together. It was precisely to that that I was objecting.
Lord Wilson of Langside: As I listened to the argument of the noble Lords, Lord Ross of Marnock and Lord Mackie of Benshie, and indeed the argument, in his first speech, of Lord Howie of Troon, the only thing I wondered—because the Minister is a kindly, thoughtful Minister and I am sure he listens to all the arguments and weighs them carefully—was whether he would accept the amendment in the light of these arguments or at least say that he would take it away and look at the situation once again.
I say that because, in my simplicity, I must confess—I am slightly ashamed to confess that I was so simple—I had thought of the situation as being amply

171
covered by Section 1(11) of the 1980 Act. No one has suggested that there was not substance in the facts on which these three arguments which the Committee has heard was based. And if there is substance in fact in that, then surely the situation is that Section 1(11) is not adequate to meet the housing and social problems presented in relation to the old aged.
I could not improve on the arguments which were presented. But it seemed to me to make clear that if you concede the need for something like Section 1(11) then clearly we need something to meet the situation outlined by those three members of the Committee. I had really thought—again in my simplicity—that the Government had simply overlooked the situation and that perhaps their advisers had not told them. I did not know about it. I ought to have known, of course. I wonder whether the Minister knew before this debate began? I do not think there was an amendment moved to this effect in the other place—certainly not one that I could find; I may be wrong about that. But if this is the first time that the Government have given consideration to these arguments, then I must say that I am surprised that they should reject them out of hand.
The Earl of Selkirk: Sheltered property is all very well for towns. It is much more difficult to get such property in the country, partly because with sheltered accommodation you need maybe 20 houses or more. In the country you do not have that. As I understand it, in many cases there are houses which would be sheltered if there were enough of them together. Special consideration has been promised to us in the English Act. I do not know whether the noble Lord has referred to this at all here. There are places which are obviously suitable for people working in the country to retire to. If these homes are sold off, the retired people will have no option but to go and live in the towns, which they will not want to do. Can the noble Lord give us some indication of whether he is prepared to reserve certain cottages or places habitually used by retired agricultural labourers for this purpose? Can we have any indication whether this is in the minds of the Government at all?
Lord Gray of Contin: I take the point raised by my noble friend. First of all, most of the houses to which he refers are not public sector houses; they are private sector houses. I think that the majority of the type of houses he has in mind are perhaps cottages on farms or estates, which over the years have been occupied by retired persons. But if he has in mind houses owned by local authorities, then the situation is as I have already described, depending on whether the house has been specially adapted for old persons, or whether it is merely a house which by custom has been used by old persons. So I have already dealt with the three types of house.
The noble and learned Lord, Lord Wilson, asked me whether I would take back this point and look at it again. I would if I thought there was any point in doing so, but I do not wish to mislead or deceive the Committee, and I am quite sure that if I were to take back the point and look at it again, I would return with merely the same answer. As I tried to explain when I
172
replied to the new clause moved by the noble Lord, Lord Ross of Marnock, the situation is already covered in regard to the points which have been raised. With regard to the houses about which the noble Lord, Lord Mackie, was concerned, the local authority already has the power by means of pre-emption. The sheltered housing complexes are already excluded.
So I do not feel that it would be to the benefit of the Committee if I were to take back this matter because I do not believe that the new clause is necessary. The arguments put forward have not convinced and I believe the situation is already covered. So I would not be prepared to take away the matter for consideration and I am afraid I cannot accept the new clause.
Lord Hughes: The noble Lord the Minister has again referred to the pre-emption conditions. I wonder whether he can refresh my memory on how this works. As I understand the position, at present houses are sold at between 50 and 60 per cent. of their market value at the time when the sale takes place, and if the Bill becomes an Act in its present form, the discount will range from 40 per cent. to 68 per cent. of the market value at the time when the transaction takes place. Let us assume therefore that it has been possible to insert a pre-emption condition in the sale. When the house comes on the market, if the local authority is to operate the pre-emption condition, under what terms does it buy it back? Does it buy it back at the same discount on the market price at which it was sold, or does the pre-emption right enable the authority to buy back the house only at full market value? If the second course is correct, then of course there is every encouragement for someone to buy so that he can at least pass on a profit to his heirs.
Lord Gray of Contin: The noble Lord is correct in the second suggestion. The house is bought back at the market value placed on it by the district valuer at the time of the purchase.
Lord Ross of Marnock: If I may add to that, regard must be had to what price was paid for the house when it was purchased in the first instance. I think that that is the completion of the definition. We have been very disappointed indeed in the Minister—not for the first time. I had hoped that as the years passed there may have been an accretion of wisdom on the part of the Government, because we are dealing with a growing problem. Between 1971 and 1981 the number of elderly people (pensioners) in Scotland increased by 8 per cent; I think that I quoted the figure as being about 375,000.
I must tell the noble Lady who spoke that most of these pensioners are on supplementary benefit, and it must be remembered that those who are already in local authority houses—and there is a large number of them—are not in a position to buy their houses. They are in receipt of housing benefit and just cannot afford to buy. I could make a long speech about this; I have here material from Age Concern and Shelter on exactly the same kind of point that the noble Lady herself made.
I know that the noble Lord has not been very long in the Scottish Office, but if he cares to look back at circulars issued long before I was Secretary of State, he

173
will see that local authorities were then being encouraged to build two-apartment houses specially for single householders. Most of them were elderly people. They were not all married couples. We were concerned about single people who, for their own reasons, had decided not to marry, who were able to maintain themselves and a household, possibly with their parents, and who afterwards were left on their own. Those people merited consideration as ratepayers and as citizens, as deserving as anyone else of good housing. I could take the noble Lord to see houses that were built as a result of the Scottish Office asking for attention to be paid to this aspect.
We can understand the position regarding sheltered housing. It forms a complex. There has to be a warning system, a warden and, if at all possible, other services. But other houses in which the right of pre-emption is involved must have facilities which are substantially different from those of an ordinary house. The kind of houses that the Scottish Office asked should be built—such as the one- and two-apartment houses—are not different from any other houses. But the definition that I have just mentioned does not end there. It says that the type of house in question must have facilities that are substantially different from those of an ordinary dwelling-house and it must have been designed or adapted for occupation by an elderly tenant whose special needs require accommodation of the kind provided by the dwelling-house.
Not all old people require special housing provision. All they probably require is a house on a lower floor, in a quiet neighbourhood. I performed the opening ceremony for such a housing scheme in a new town the other day. That kind of housing does not meet the pre-emption requirements and the great bulk of the houses that we are talking about do not come within Category 1 or Category 2, but they are houses which by custom the local authorities have been letting to elderly people, whether they be married or single. That is an actual fact.
Consider sheltered housing. In regard to sheltered housing—that is, the specially built houses—the SDD suggested a ratio of 50 per 1,000. So, for a start, on that basis there are 950 houses, without the sheltered housing. The tenants just want to live as ordinary people; they do not want anything special at all, other than facilities to meet the needs of old age.
But what happens if this type of house is to be sold?—and it is being sold now. I am not saying who goes into such a house; it might be an overcrowded house before very long and so it will be necessary to provide a far bigger house. Here is the weakness of the Government's plans. There will be more and more need for this kind of house, but the need will not be met by sheltered houses, because there are not enough of them, and not very many more are to be built. The great bulk of the need can be met only by the type of one- and two-apartment houses I have been talking about. I do not think that the Government have begun to appreciate the difficulty, nor the growing need for this type of housing in towns and rural areas. I think that the point was well made by the noble Earl, Lord Selkirk; there will not be many sheltered houses in rural areas. I am willing to bet that there is none in designated rural areas. The same applies to the others.
174
We are dependent, in helping elderly people, on the type of house about which I have been talking which is customarily let to old people. For that reason, I do not think that we can allow this matter to go. I am sorry, because I know that the Minister has tried hard. But it is not hard enough. I have been waiting for a Minister to start throwing his weight about at the Scottish Office and to realise just what kind of office he has. So let the noble Lord use his power. But let the House of Lords also use its power in showing the Government how we feel about the problem. Let the Government recognise that the amendment will offer some help, if not a solution.
5.40 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 94; Not-Contents, 113.

DIVISION NO.2

CONTENTS

Airedale, L.

Kilmarnock, L.

Ardwick, L.

Kinloss, Ly.

Aylestone, L.

Kirkhill, L.

Banks, L.

Leatherland, L.

Barnett, L.

Llewelyn-Davies of Hastoe, B.

Beaumont of Whitley, L.

Lloyd of Hampstead, L.

Birk, B.

Lloyd of Kilgerran, L.

Bishopston, L.

[Teller.]

Blease, L.

Lockwood, B.

Blyton, L.

Loudoun, C.

Bottomley, L.

Lovell-Davis, L.

Briginshaw, L.

McCarthy, L.

Brooks of Tremorfa, L.

McGregor of Durris, L.

Bruce of Donington, L.

Mackie of Benshie, L.

Caradon, L.

McNair, L.

Carmichael of Kelvingrove, L.

Milford, L.

Chitnis, L.

Molloy, L.

Collison, L.

Mulley, L.

David, B.

Northfield, L.

Dean of Beswick, L.

Ogmore, L.

Donaldson of Kingsbridge, L.

Oram, L.

Donnet of Balgay, L.

Phillips, B.

Elwyn-Jones, L.

Ponsonby of Shulbrede, L.

Ennals, L.

[Teller.]

Evans of Claughton, L.

Raglan, L.

Ewart-Biggs, B.

Rea, L.

Ezra, L.

Rhodes, L.

Fisher of Rednal, B.

Rochester, L.

Foot, L.

Ross of Marnock, L.

Gaitskell, B.

Segal. L.

Gallacher, L.

Shaughnessy, L.

Gladwyn, L.

Stallard, L.

Graham of Edmonton, L.

Stedman, B.

Hale, L.

Stoddart of Swindon, L.

Hampton, L.

Stone, L.

Hanworth, V.

Strabolgi, L.

Harris of Greenwich, L.

Taylor of Blackburn, L.

Hatch of Lusby, L.

Taylor of Mansfield, L.

Hayter, L.

Tordoff, L.

Hughes, L.

Underhill, L.

Irving of Dartford, L.

Wallace of Coslany, L.

Jacobson, L.

Walston, L.

Jacques, L.

Wells-Pestell, L.

Jeger, B.

Whaddon, L.

Jenkins of Putney, L.

White, B.

John-Mackie. L.

Wigoder, L.

Kagan, L.

Wilson of Langside, L.

Kaldor, L.

Winstanley, L.

NOT-CONTENTS

Alexander of Tunis, E.

Avon, E.

Allerton, L.

Bauer, L.

Alport, L.

Belhaven and Stenton, L.

175

Belstead, L.

Lucas of Chilworth, L.

Blake, L.

Luke, L.

Bolton, L.

Lyell, L.

Brookes, L.

McAlpine of Moffat, L.

Caccia, L.

McFadzean, L.

Cairns, E.

Mackay of Clashfern, L.

Caithness, E.

Macleod of Borve, B.

Campbell of Alloway, L.

Mancroft, L.

Campbell of Croy, L.

Marley, L.

Carnegy of Lour, B.

Marshall of Leeds, L.

Cathcart, E.

Maude of Stratford-upon-

Chelwood, L.

Avon, L.

Cockfield, L.

Merrivale, L.

Coggan, L.

Mersey, V.

Coleraine, L.

Molson, L.

Cork and Orrery, E.

Montgomery of Alamein, V.

Cox, B.

Morris, L.

Craigavon, V.

Mottistone, L.

Cranbrook, E.

Mowbray and Stourton, L.

Cromartie, E.

Murton of Lindisfarne, L.

Cullen of Ashbourne, L.

Nathan, L.

Daventry, V.

Newall, L.

Davidson, V.

Norfolk, D.

Denham, L. [Teller.]

Nugent of Guildford, L.

Drumalbyn, L.

Onslow, E.

Eccles, V.

Orkney, E.

Elgin and Kincardine, E.

Orr-Ewing, L.

Ellenborough, L.

Pender, L.

Elliot of Harwood, B.

Perth, E.

Elton, L.

Peyton of Yeovil, L.

Faithfull, B.

St. Davids, V.

Ferrers, E.

Saint Oswald, L.

Forte, L.

Salisbury, M.

Fortescue, E.

Saltoun, Ly.

Fraser of Kilmorack, L.

Selkirk, E.

Geoffrey-Lloyd, L.

Sharpies, B.

Glenarthur, L.

Skelmersdale, L.

Gormanston, V.

Somers, L.

Gray of Contin, L.

Stodart of Leaston, L.

Halsbury, E.

Sudeley, L.

Henley, L.

Suffield, L.

Home of the Hirsel, L.

Swansea, L.

Hornsby-Smith, B.

Swinfen, L.

Hylton-Foster, B.

Swinton, E. [Teller.]

Inglewood, L.

Terrington, L.

Ingrow, L.

Thomas of Swynnerton, L.

Killcarn, L.

Tranmire, L.

Kimberley, E.

Trefgarne, L.

Kintore, E.

Trenchard, V.

Lane-Fox, B.

Trumpington, B.

Lauderdale, E.

Vaizey, L.

Lawrence, L.

Whitelaw, V.

Lindsey and Abingdon, E.

Windlesham, L.

Long, V.

Wise, L.

Resolved in the negative, and amendment disagreeed to accordingly.
5.49 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 6:
After Clause 2, insert the following new clause:
(" Saving for rural areas.
In subsection (11) of section 1 of the 1980 Act the following shall be inserted after paragraph (c)—
("; no
(e) where the sales of dwelling-houses situated within an area or community which is designated a rural area or community by the district or islands council in which it is situated have exceeded one-fifth of the stock available since the introduction of the statutory right to buy, at the discretion of the council.".").
The noble Lord said: This is a protection for houses in rural areas and the population of rural areas. It is not suggested that there should be no sale of local authority houses in rural areas. We are suggesting, however, that when a limit is reached of 20 per cent.,
176
any further sales should be at the discretion of the local authority.
I am sure that the Minister has already been given correspondence from various bodies, including Shelter, from which it is interesting to note that the sale of council or local authority houses in rural areas is considerably higher than the Scottish average. Shelter says that although about 3 per cent. of local authority housing stock in Scotland has been sold, in certain rural areas—and it gives the example of the stewardship of Kirkcudbright—11 per cent. of the houses have been sold, which is really taking it to a fairly high number. Within the larger districts there are small areas where the increase has been as high as 25 per cent. or more. These sales tend to reduce the amount of housing available to rent and they frustrate the very genuine needs of applicants who are on the waiting list.
The other difficulty is that the local authority has still to replace these houses if it wants to fulfil its other obligation to provide houses for rent in the area. But the cost of building in rural areas is considerably higher than in urban areas. The high cost of house building in sparsely populated areas means that local authorities will remain the most important source of supply of new house building. Indeed, that is the view of the Scottish Consumer Council which looked into this matter some time ago.
I also understand that the Scottish Office is very well aware of the problem, and it has said that many people are not able to command sufficient income in the rural areas to enable them to buy houses. A survey carried out by the Scottish Office indicated that wages in rural areas are just not sufficiently high to allow people to be able to rebuild or to build from new themselves. So, although the Bill applies to rural areas—and we accept that it must apply to rural areas if it is passed at all by Parliament—we on this side of the Committee feel that there should be some restriction because of the very special nature of the rural areas, such as I have tried to describe; for example, more expensive house building and the fact that there are fewer local authority houses proportionate to the population than in the rest of the country.
The other very important point is that if we sell houses off in the rural areas, bearing in mind the high costs of building and especially if advantage is taken of the very big increase in the discount that is going to be allowed—the 60 per cent. discount—the cost to the rural districts will be even greater. Even under the present level of discount, without going to 60 per cent., I understand that the money received from the sale of houses would mean that the local authority would have to sell three houses in order to be able to build one, and that means that the market for rent would be considerably reduced.
Of course there is nothing to stop a person getting one of these new houses in a rural area and, after having the let of the house for two years, applying to buy at a very considerable discount—32 per cent. discount. Therefore, I submit that the rural areas do need very special protection. I hope that the Minister will look sympathetically at this amendment and will realise that we are speaking about a very special case which has already been borne out not by any

177
sentimentality, but by the fairly hard figures already available to the Scottish Office. I beg to move.
Lord Mackie of Benshie: I rise to make another plea to the Minister to support this very reasonable amendment. We are, after all, dealing with rural areas, and in the rural areas there are enormously sensible councils. Surely the Minister must know that he is not dealing with recalcitrant militants in the big cities; he is dealing with the type of people he knows and understands, some of whom might even support the Tory Party.
The amendment says quite clearly:
"at the discretion of the council".
In rural areas it is very important that there is an adequate stock of council houses. What is very noticeable is the difference between the attitude of the farmworkers' union in England and in Scotland. One of the reasons for the Scottish farmworkers' union looking upon the tied house with a very kindly eye is that in Scotland there are rural councils which have been very good about providing retirement houses and, indeed, about providing alternative housing in the country. In fact, 20 per cent. or one-fifth of the stock is a very large proportion. But if it is found that it is not needed and that they can sell more, then it is at the discretion of the council. This appears to me to be an entirely reasonable amendment and I implore the Minister to chuck his weight about and his brief away and to listen to the very sensible arguments which are being adduced for inserting the new clause.
Lord Gray of Contin: It is quite clear from what has been said that at least some noble Lords opposite are still labouring under the misapprehension that houses which are sold are in some way lost to the housing stock. I have tried to make it as clear as I can, on several occasions during our discussion, that this simply is not the case. If tenants were not allowed to buy their homes it does not mean that they would move away; the great majority of them would continue to rent their homes, often for a considerable number of years. This is equally true whether the houses are in rural areas or in urban areas.
Houses which are sold would not become available for re-letting therefore on any timescale which is relevant to the needs of people currently on the housing authority's waiting lists. It is simply not the case that by not purchasing houses those houses would by some means automatically become available—they would not do so. Other and more immediate ways must be found of helping people on the waiting lists, and the additional finance released by sales can be of considerable benefit in this process.
Under the block allocations system, authorities are free to determine their own priorities for expenditure within the resources available. However, it follows from what I have said that since sales do not increase the need for new building, there can be no argument for my right honourable friend the Secretary of State to give authorities specific consent to incur additional capital expenditure to replace houses which have been sold.
Therefore, I do not accept the points which the noble Lords have made regarding rural areas. In this
178
context I do not see rural areas as being in any way different from urban areas. I believe that the problems which the noble Lords have suggested arise in rural areas are more imagined than real and I hope, therefore, that they will agree to withdraw their amendment.
Lord Mackie of Benshie: I ask your Lordships to forgive me once more, but rural areas are different, and they are different for this reason. Since the advent of the motor car people who have good jobs in towns often wish to live in the country, and they buy their house in the country and they motor to work. Further-more, with rising prosperity—or prosperity was rising until recently—people have wanted a house in the country as a second home. We have illustrations of this and of the trouble it has caused in the Highlands and in Wales.
Without any doubt there is a difference. Everyone knows the trend towards commuting in Scotland; everyone knows the trend towards having a second house. In fact, it is necessary to have a good stock of council houses in a rural area so that, if competition is normal, people can buy a house. They cannot compete with the rich commuter to the nearby city.
The Earl of Selkirk: I should like to support what the noble Lord, Lord Mackie of Benshie, has just said. My noble friend the Minister has made an unfortunate remark when he said that country areas are no different from town areas. They are fundamentally different in a number of ways. He made a great mistake. Frankly, unless my noble friend can show that he is giving some consideration to this—which, if I may say (though perhaps irrelevantly), to some extent is in the English Act—I must ask him to take it away and think about it again. This is not good enough. I am thinking of council houses to which people can retire; that is to say, people are no longer living in tied cottages and so require employment and they do not want to leave the district. Unless some other form of housing is available there will be no alternative but for them to go to the town. This is a considerable hardship for people who have lived all their life in the country, so there should be some degree of protection for these people when they reach pensionable age. It would be quite wrong if they were not cared for. Therefore, I must ask my noble friend to think a little more about this before turning it down flat.
Lord Gray of Contin: I should like to try to deal with the point raised by the noble Lord, Lord Mackie. The 1980 Act already does all that is necessary to safeguard against substantial numbers of former council houses in rural areas being sold as holiday or second homes.
The Earl of Selkirk: Could we please have the section?
Lord Gray of Contin: Subsections (6) and (7) of Section 4 of the 1980 Act enable the Secretary of State to make an order permitting authorities to impose pre-emption conditions on sales of houses in rural areas, provided that more than one-third of the council houses in the area have been sold and that an unreasonable proportion of the houses sold have been

179
resold as second homes. Therefore, I hope that the noble Lord, Lord Mackie, will accept that there is substantial protection as regards that.
During the passage of the 1980 Act the Government took the view that the likelihood of substantial numbers of council houses being resold as holiday homes was remote, and our experience still has not caused us to alter that view. To date not one single authority has approached us to suggest that the conditions have been satisfied and asked for an order to be made under Section 4(6) and (7). Therefore, I believe that when the noble Lord, Lord Mackie, considers what I have said he will appreciate that from the outset this was a point which greatly concerned the Government, and therefore the Government took the necessary action. However, as I have again explained, we have not been approached by any councils which are apprehensive about this condition.
My noble friend Lord Selkirk has said to me, not for the first time, that he is concerned about elderly people who live in rural areas. He also suggested that rural areas are very different from urban areas. That I accept. I said that as far as I could see the actual sale of a council house is no different in a rural area from a sale in an urban area. The principle is the same. Indeed, substantial numbers of council houses have been sold in rural areas. However, my noble friend seeks to achieve something which I cannot guarantee. If he is asking me to ensure that there will always be a readily available supply of empty houses suitable for elderly people to retire to, I am afraid that that is something which I cannot guarantee.
However, there is no doubt that from time to time houses which have traditionally been occupied by elderly people will continue to be occupied by elderly people. However, I am afraid that I cannot give my noble friend the guarantee which he seeks. I hope that I have clarified the point for the noble Lord, Lord Mackie of Benshie, and for the noble Lord, Lord Carmichael, and that they may be prepared to withdraw their new clause.
Lord Mackie of Benshie: I should like to make one small point. On an Act that was passed in 1980 I do not think that the experience to date is enough to go on. That is not an argument that I could accept in looking at this matter.
The Earl of Selkirk: Can my noble friend say whether rural areas have been designated? Section 4(6) of the 1980 Act says that:
"an area which is designated a rural area by the islands or district council".
Has that been done, and is there somewhere where we can find the decision that was reached?
Lord Gray of Contin: I shall have to check on that point for my noble friend. An area which has been designated a rural area within an islands or district council speaks for itself. I shall have to seek information on whether actual designations have taken place. Once again, I find that by speaking long enough, the information has arrived. Areas as such have not been designated. Therefore, when we refer to rural areas we are merely talking about country areas, because no rural area as such has been designated.
Lord Carmichael of Kelvingrove: The noble Lord the Minister will not be surprised to realise that his answers have not been totally successful in allaying the fears of the Committee. He quoted, quite correctly, subsections (6) and (7) of Section 4 of the 1980 Act, and he also pointed out that local authorities have not urged the Secretary of State to use his power. The noble Lord, Lord Mackie, made one very important point when he said that it is rather early days to discover whether local authorities will not at some point require to use those powers. The period between 1980 and today is not all that long for someone contemplating purchasing a house, and it is also right in the middle of a recession, when perhaps there are fewer demands by people to buy second homes than there were previously or will be in the future.
The point about protection was raised. It is still a very narrow protection that is given to a local authority when it has reached the level of one-third of the stock of the whole area. I quoted an example that in certain rural areas perhaps 10 or 11 per cent. of houses have been sold. Within larger districts there are small areas where sales are as high as 25 per cent. So in certain districts if it goes any higher and if it went to a third for the entire district, it would mean that there would be total saturation of sales of local authority houses, and no opportunity for the large number of people who are indigenous to the area to be able to retire to a local authority house or even to get a local authority house for rent.
Here again, I believe that the noble Lord was wrong—and he was corrected by a number of noble Lords—when he said that in this regard there is no difference between a rural area and an urban or city area. I and others tried to point out that there are obvious differences. The Scottish Consumer Council made it very clear in its statement that the levels of income in rural areas tended to militate against people being able to accumulate enough funds to be able to buy a house, so the local people are most unlikely to be able to do it. It also pointed out that the increase in the number of people may be a good thing. But they come to certain areas—and I think that Tweeddale was one—where there is a large number of commuters, who find a nicer life (and I do not blame them) living in that area and who travel to Edinburgh and other cities during the day. These are the kinds of people who will be able to take local authority houses if they are given the opportunity.
The other difference between rural and urban areas is the high cost of building a house. On the figures given by Shelter you have to sell three houses in order to gain one. I take the point of the noble Lord the Minister when he says that there is a tendency to think that these houses disappear once they have been sold. Of course they do not disappear, but they disappear from the letting market and in rural areas there is a very high proportion of people who need houses to let. If houses disappear from the letting market and others are able to buy them—even given the protection of Section 34 of the parent Act—it would still make it very much more difficult for the indigenous people to get decent housing accommodation at a reasonable rent. I feel therefore that the answers given by the noble Lord the Minister have not been adequate enough and I urge my friends and others to support the amendment.
On Question, Whether the said amendment (No. 6) shall be agreed to?
Their Lordships divided: Contents, 83; Not-Contents, 104.

DIVISION NO.3

CONTENTS

Airedale, L.

John-Mackie, L.

Ardwick, L.

Kagan, L.

Aylestone, L.

Kaldor, L.

Banks. L.

Kilmarnock, L.

Barnett, L.

Kinloss, Ly.

Beaumont of Whitley, L.

Kirkhill, L.

Birk, B.

Leatherland, L.

Bishopston, L.

Llewelyn-Davies of Hastoe, B.

Blease, L.

Lockwood, B.

Blyton, L.

Loudoun, C.

Boston of Faversham, L.

Lovell-Davis, L.

Bottomley, L.

McCarthy, L.

Brooks of Tremorfa. L.

Mackie of Benshie, L.

Bruce of Donington, L.

NcNair, L.

Caradon, L.

Milford, L.

Carmichael of Kelvingrove, L.

Mishcon, L.

Chitnis, L.

Molloy, L.

Collison, L.

Mulley, L.

David. B.

Northfield, L.

Dean of Beswick, L.

Ogmore, L.

Donaldson of Kingsbridge, L.

Oram, L.

Elwyn-Jones, L.

Perry of Walton, L.

Ennals, L.

Phillips, B.

Evans of Claughton, L.

Ponsonby of Shulbrede, L.

Ewart-Biggs, B.

Rea, L.

Ezra, L.

Rhodes, L.

Fisher of Rednal, B.

Rochester, L.

Gaitskell, B.

Ross of Marnock, L.

Gallacher, L.

Stedman, B.

Gladwyn, L.

Stoddart of Swindon, L.

Graham of Edmonton, L.

Stone, L.

[Teller.]

Strabolgi, L.

Gregson, L.

Taylor of Blackburn, L.

Hale, L.

Tordoff, L.

Hanworth, V.

Underhill, L.

Harris of Greenwich, L.

Wallace of Coslany, L.

[Teller.]

Walston, L.

Houghton of Sowerby, L.

Wells-Pestell, L.

Hughes, L.

Whaddon, L.

Irving of Dartford, L.

White, B.

Jacques, L.

Wilson of Langside, L.

Jeger, B.

Winstanley, L.

Jenkins of Putney, L.

NOT-CONTENTS

Alexander of Tunis, E.

Cox. B.

Allerton, L.

Crathorne, L.

Alport, L.

Cromartie, E.

Avon, E.

Daventry, V.

Bauer, L.

Davidson. V.

Belhaven and Stanton, L.

Denham, L. [Teller.]

Bellwin, L.

Eccles, V.

Beloff, L.

Elgin and Kincardine, E.

Belstead, L.

Elliot of Harwood, B.

Blake, L.

Elton, L.

Bolton, L.

Ferrers, E.

Brabazon of Tara, L.

Fortescue, E.

Brookes. L.

Fraser of Kilmorack, L.

Brougham and Vaux, L.

Glenarthur, L.

Caccia, L.

Gormanston, V.

Cairns, E.

Gray of Contin, L.

Caithness, E.

Henley, L.

Campbell of Alloway, L.

Hives, L.

Campbell of Croy, L.

Home of the Hirsel, L.

Carnegy of Lour, B.

Hornsby-Smith, B.

Cathcart, E.

Hunter of Newington, L.

Chelwood, L.

Hylton-Foster, B.

Cockfield, L.

Ingrow, L.

Coleraine, L.

Killearn, L.

Cork and Orrery, E.

Kintore, E.

182

Lane-Fox, B.

Orkney, E.

Lauderdale, E.

Orr-Ewing, L.

Lawrence, L.

Pender, L.

Lindsey and Abingdon, E.

Peyton of Yeovil, L.

Long, V.

Renton, L.

Lucas of Chilworth, L.

St. Aldwyn, E.

Lyell, L.

St. Davids, V.

McFadzean, L.

Saint Oswald, L.

Mackay of Clashfern, L.

Salisbury, M.

Mancroft, L.

Saltoun, Ly.

Marshall of Leeds, L.

Selkirk, E.

Massereene and Ferrard, V.

Sharpies, B.

Maude of Stratford-upon-

Shaughnessy, L.

Avon, L.

Skelmersdale, L.

Merrivale, L.

Sudeley, L.

Mersey, V.

Suffield, L.

Molson, L.

Swansea, L.

Montgomery of Alamein, V.

Swinfen, L.

Morris, L.

Swinton, E. [Teller.]

Mowbray and Stourton, L.

Thomas of Swynnerton, L.

Murton of Lindisfarne, L.

Tranmire, L.

Napier and Ettrick, L.

Trefgarne, L.

Nathan, L.

Trenchard, V.

Newall, L.

Trumpington, B.

Norfolk, D.

Whitelaw, V.

Nugent of Guildford, L.

Windlesham, L.

O'Neill of the Maine, L.

Wise, L.

Onslow, E.

Resolved in the negative, and amendment disagreed to accordingly.
6.19 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 7:
After Clause 4, insert the following new clause:
("Dwelling-houses for educational purposes.
After section 3A of the 1980 Act there shall be inserted the following section—
"Landlord's right to refuse to sell certain dwelling- houses required for educational purposes.
3C.—(1) This section applies where an application to purchase a dwelling-house is served on an islands council as landlord and—

(a) the dwelling-house is—

(i) held by the council for the purposes of its functions as education authority; and

(ii) required for the accommodation of a person who is or will be employed by the council for those purposes;

(b) the council is not likely to be able reasonably to provide other suitable accommodation for the person mentioned in paragraph (a)(ii) above; and

(c) the tenant would, apart from this section, have a right under section 1 of this Act to purchase the dwelling-house. The landlord may, within one month of service of the application to purchase or of the commencement of this section, whichever is the later, refuse the application.

(2) A notice of refusal shall specify the grounds on which the landlord refuses the application of the tenant;
(3) Where a landlord serves a notice of refusal on a tenant under this section, the tenant may within one month thereafter apply to the Lands Tribunal for Scotland for a finding that the landlord has acted unreasonably and that the tenant has a right to purchase the dwelling-house under section 1 of this Act on such terms as it may determine." ").
The noble Lord said: I beg to move the words on the Order Paper. This is an important amendment but one of limited importance from a Scottish point of view. Indeed, it originates from the Western Isles, from Orkney and from Shetland Islands Council, which has control both over education and housing: so it is unique in that respect. I think the first thing I want to do is thank the Government for what they have done so far in meeting their difficulties in respect of teachers' houses. The position in areas such as that is that the provision of a house for a teacher is a considerable

183
attraction. In fact, without it the areas could not get teachers. That is where it starts. Most of the teachers' houses are local authority houses. It was so under the Inverness County Council in one incarnation, and the same thing applied to the Shetland and Orkney County Councils. Under reorganisation the Islands Council is now multi-purpose. The same thing is true of Orkney and of Shetland. The three councils have been worried about this since 1980.
There has been a considerable sale of teachers' houses; mainly in Stornoway from the figures I have received from the Western Isles. It was felt that some of the houses would have sold anyway without the compulsions of the 1980 Act, but some houses, about 11 to 14, the councils would rather have held on to, to enable them to attract teachers into the area. The whole affair became so desperate that they have been in touch with the Scottish Office and an amendment was moved and accepted in another place. That is one of the reasons why the Bill is so much larger now than it was when it first set out in another place.
The councils still feel a sense of unfairness about the matter. They know the difficulties and the local conditions; but they feel hard pressed that it has not been left to their discretion to decide which houses to sell, and they are particularly annoyed that they have to apply to the Secretary of State for approval. The only reason as to why the Secretary of State should make a judgment was whether it was wise in the first place to say that a house should not be sold.
The councils are the people who know about this; the Secretary of State does not. It used to be bad enough for a Secretary of State to read in a newspaper that he had decided to refuse planning permission for a petrol pump somewhere. It was always an education for me to find out the things that I had done or that had been done in my name in relation to many things in Scotland. But surely this sort of thing should be left to the discretion of the Western Isles Council and the Orkney and Shetland Councils.
The reason for my amendment is to try to restore a measure of discretion to these councils. They rightly think that if an appeal or a decision is to be reconsidered by someone, it should not have to go to the Secretary of State. I so much agree with them. It should not go to the Secretary of State, but should be dealt with elsewhere. That, simply and quickly, is the reason for this amendment. If Lord Grimond had been here I think he would have dealt with this amendment, and probably better than I have. Unfortunately, he was not available today. I beg to move.
Lord Mackie of Benshie: I agree with the amendment.
Lord Wilson of Langside: I, too, agree, and I was sitting wondering whether this would be the record when the Minister accepted this very sensible suggestion.
Lord Gray of Contin: In the interests of brevity and to be in accord with others who have spoken, I am tempted just to say that I do not agree and sit down. But I hardly think that would be suitable, and I should give your Lordships the reasons why I cannot accept the amendment.
184
It may be helpful if I explain that Clause 4 was brought forward by the Government as an amendment in another place in response to representations from the Islands Councils. The Islands Councils felt that they should not be required to sell teachers' houses in remote areas where they could not easily be replaced. I am grateful to the noble Lord, Lord Ross of Marnock, for acknowledging what the Government have done in this repect.
The Government readily accept the principles here. Indeed, the 1980 legislation already provides that where a tenant is employed by his landlord and is required to occupy the house he rents as part of his contract of employment, that tenant, who, in effect, is a tied tenant, does not have the right to buy. Unlike with other employees, however, the teachers' contracts did not require them to occupy specific houses even though the houses they rented were clearly tied to their employment. As a result, teachers in the islands had security of tenure and the right to buy. This is why, in response to the representations from the Islands Councils, the Government brought forward the provisions which are now contained in Clause 4.
I know that the Islands Councils would have preferred that the decision whether to sell teachers' houses, or to refuse to sell them, should have been left in their own hands. However, since the teachers are not tied tenants but are secure tenants, with all the other rights which that means, the Government did not feel able to accept that this discretion should be left in the hands of the Islands Councils.
This is not to suggest that any Islands authority would act other than most fairly. At the same time, however, there must be an element of arbitration between two, possibly conflicting, points of view. To leave the decision to the Islands Councils would mean that they were judge in their own cause. We did not feel that this was acceptable from the tenants' point of view, and so we concluded that the fairest and best way to proceed was by asking the Secretary of State to consider the matter and to make the decision. With that explanation, I trust that your Lordships might be prepared to withdraw the amendment.
Lord Ross of Marnock: Could we have a bit of argument about why it is the Secretary of State and not the Lands Tribunal?
Lord Gray of Contin: I appreciate that the noble Lord's amendment seeks to deal with this matter by providing that a tenant who feels aggrieved by a decision of his council to refuse to sell his house may have recourse to the Lands Tribunal to have the decision reversed. However, this would add a further stage to the process and an additional complication, which I believe is neither necessary nor appropriate to the relatively small number of cases which we expect to arise under this provision.
The approach we have adopted in Clause 4 is similar to the treatment under the existing 1980 legislation for houses which have been specially adapted for the needs of elderly people. I believe that in relation to those houses the approach has provided a satisfactory means of guarding the interests of both the landlord and the tenant in cases where we recognise that there are houses of a special category which it is important

185
that the council should be able to retain, if it is to carry out its statutory functions. I appreciate that the Islands Councils original suggestions were somewhat different, but we have made our position clear to them and they have not indicated that they are unhappy with the new Clause 4. I understand that it is also acceptable to the teachers' representatives.
In short, we accept that the Islands Councils have a problem over the sale of teachers' houses and we believe that Clause 4 provides the best possible balance between meeting the difficulties of the Islands Councils while, at the same time, safeguarding the interests of the tenants. I am not attracted by the noble Lord's further amendment and therefore I urge him to withdraw it.
Lord Ross of Marnock: The Western Isles teachers are not terribly well represented in this House. We have faced the problem and the difficulties of getting teachers into the Western Isles—let us remember that the areas concerned are not all as big as Stornoway—where quite a number of teachers' houses have been sold without any difficulties. But when you come to the smaller islands and the more remote areas it is very difficult indeed to be able to advertise for a teacher and to get one without being able to afford him a council house.
What does the Secretary of State know about conditions there? Why bother the Secretary of State with a thing like that? Certainly he has got enough on his plate. To my mind, this is obviously a matter where you have to rely on the discretion of the local authority and, if you want to have a back-up in respect of that, then appeal to the Lands Tribunal.
The Minister will recollect, or somebody will tell him—he does not like people putting words into his mouth unless the words come straight from St. Andrew's House, and from my own experience their choice of words is not always very wise—that this was the hope, I think, that was being expressed: that he would start thinking for himself and speaking for himself. He has got some experience of remote areas, because the Member for Ross and Cromarty in another place at one time would be very conscious indeed of this particular difficulty, although there is no solution for them. The difficulty of course arises because under the reorganisation the district council is concerned with housing; and the other council, the Highlands Council, is responsible for education. It so happens that probably in the areas worst affected— the Western Isles, Orkney and Shetland—the Islands Council is responsible for both education and housing, so we can reach a solution to the problem.
I would appeal to the Minister of State not to turn this down offhand, because I am afraid I will need to bring this one back again in some other form. In fact, but for the well-chosen words of the Western Islands Council, I would simply have left out the approval of the Secretary of State altogether and given a blanket discretion to the councils. But they are even more fair-minded than I: they think about the teachers and of possible discrimination there, and so they say, "Well, if he thinks it is unreasonable, give him an appeal to the Lands Tribunal". The Lands Tribunal is very much nearer to the hearts—and not just to the hearts, but actually nearer to the islands—than the
186
Secretary of State. I think they have been very sensitive to the demands of the Scottish Office in respect of the amendment they have put down. I think it is a very, very good amendment and I am really disappointed that the Scottish Office has not gone so far as to be able to accept it.
I shall not press the amendment just now, but I am afraid I will have to come back to it because I am not satisfied with the explanation that has been given. It has been virtually a non-explanation. We have had this all day, with the Minister rising and saying, "The Government think they are right, and that is that." So I hope he will do a little better, if not at this stage, then at the next stage. I know he has other work to do—he has got a roads Bill, which is coming on Thursday—but, with all due respect, so have we, and we have no Scottish Office behind us to provide us with arguments and to fashion amendments. His greatest job on the Roads (Scotland) Bill will be to keep the place. I am not going to help him on that one. He has not been very helpful to us today, has he? He could have made a name for himself with this Bill—the great Lord Gray of Contin: he accepted an amendment and gave his blessing at the same time to the civil servants who are anxiously waiting to see whether he continued to say, "No". But he has not risen to the occasion. I am prepared to withdraw the amendment, and I hope that between now and the next stage of the Bill the Government will have second thoughts. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.35 p.m.
Lord Wilson of Langside Lord Wilson of Langside moved Amendment No. 8:
Insert the following new clause:
("Duties of landlords.
. In section 7 (Duties of Landlords) of the 1980 Act in subsection (1) for the words "the progression" there shall be substituted the words "the speedy and efficient progression".").
The noble Lord said: I beg to move this amendment, and I can be very brief for two reasons. The first is that your Lordships' discussion on this Bill has already occupied more time than had been anticipated; and the second reason is that the Government do not seem in the mood to accept even eminently sensible amendments. Accordingly, I think it is unlikely that they will move far in response to this one.
Its purpose is merely to focus on the point which was touched on during Second Reading, that some local authorities, in processing applications under Part 1 of this Bill, were, as has been said, dragging their feet. Accordingly, the amendment suggests that in Section 7 of the 1980 Act, which lays down the duties of the landlord in relation to the processing of applications under the Act, the words "speedy and efficient" should be added.
I was in some doubt as to whether a progression can indeed be either speedy or efficient but the meaning is clear, I think. The purpose of the amendment is simply to probe the Government's attitude towards the situation that arises (as it has arisen) that certain local authorities, albeit a small number, are inclined, for whatever reason, to drag their feet in putting through these processes.
Lord Gray of Contin: The later stages of a sale, once an offer to sell has been accepted and missives concluded, are not regulated by the Tenants' Rights Act. Rather, they are subject to the ordinary law of contract. The legal remedy available to a tenant who considers that the district council is failing to complete the sale of his house within a reasonable time is therefore to raise an action of specific implement in the sheriff court, requiring the district council to implement the contract enbodied in the missives.
An individual tenant who experiences delays in the processing of his application to purchase thus has legal remedies available to him. Having said this, our view or course is that tenants should only require to have recourse to these remedies in exceptional circumstances. The Scottish Development Department keeps a close watch on authorities' performance in relation to the processing of applications and reports to Ministers regularly. If these reports indicate that significant delays are occurring in any area in the processing of applications, this is of course a matter of concern to us and we take whatever action is open to us to secure an improvement in the relevant authority's performance.
In October, for example, the reports submitted to my right honourable friend the Secretary of State indicated that there were 15 authorities which, on the basis of the most up-to-date information then available, were taking more than 12 months to complete sales, despite the fact that the-right-to-buy legislation had been in force for over three years. My right honourable friend therefore instructed the Scottish Development Department to write to these 15 authorities expressing his concern at the delays in completing sales, drawing attention to the serious consequences that delay in the delivery of receipts would have for their capital programmes and asking for an indication of the action which they had taken or proposed to take to ensure that sales were completed within a reasonable period.
I am pleased to say that most of these authorities now either have provided evidence of satisfactory performance or have given undertakings to improve their processing arrangements. We shall of course continue to monitor the position.
Statistical returns submitted by authorities indicate that across Scotland as a whole the average time taken to process a sale from application to completion has fallen from just over 13 months in the last quarter of 1982 to just over 10 months in the last quarter of 1983. There is a clear downwards trend in the average processing time and I am confident, therefore, that we shall see further improvements in the coming months. In view of what I have said, I trust that the noble Lord will be prepared to withdraw his amendment.
Lord Wilson of Langside: I am grateful for the explanation which the Minister has given to the Committee, and I am happy to ask for its leave to withdraw my amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Renton): I have to confess to an omission on my part.
188
I failed to put Clause 3 and Clause 4 stand part. I propose to do so now—I hope better late than never.
Clause 3 agreed to.
Clauses 4 to 6 agreed to.
Clause 7 [Right to carry out repairs]:
6.43 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 9:
Page 5, line 4, leave out ("may") and insert ("shall").
The noble Lord said: This amendment is designed to tighten up the obligations on the Secretary of State and to try to elicit from the noble Lord, Lord Gray of Contin, under what circumstances, if the word "may" were to be retained, the Secretary of State would decide not that he may but that he shall make a scheme by regulation. To give to the Secretary of State this kind of discretion, which relates to one group of tenants as compared with another is very unfair. Therefore, it is important to be positive and not to leave it so vague as to give wide discretion to the Secretary of State. Before deciding what to do about this amendment, I should like to hear what the Minister has to say. I beg to move.
Lord Gray of Contin: The noble Lord's amendment seeks to convert the proposed new Section 17A of the 1980 Act from a provision which will enable my right honourable friend the Secretary of State to set up a right to repair scheme into a provision which will require him to set up such a scheme. I appreciate that the purpose of this amendment is probing. The Government have made clear that it is their intention to introduce a scheme which will give secure tenants a right to carry out repairs which would otherwise be the responsibility of their landlord and to claim a payment from the landlord for having done so. The commitment to introduce such a right was included in the Government's manifesto at the general election last year.
We have embarked on a process of consultation on the detailed operation of the scheme. We are currently considering the responses we have received to the consultation paper we issued in November, together with the many helpful comments and suggestions made during the debates on this Bill both in your Lordships' House and in another place. When we have completed our consideration of these responses we will be making a draft of the regulations available for further comment before the regulations are laid formally before Parliament.
I would suggest, however, that the noble Lord's amendment is unnecessary. It is unnecessary because we are fully committed to introducing a scheme. It is also inappropriate because the power in the Bill is properly an enabling power; the details of the scheme will be set out in the subsequent regulations, which we shall be bringing forward in due course. I trust that in the light of this explanation, the noble Lords will agree to withdraw their amendment.
Lord Carmichael of Kelvingrove: The noble Lord's reply is disappointing. He began by saying that there is

189
no question of its not happening; that we must believe in the good faith of the Government; that they are holding interviews; that they will listen to what is said both here and in another place before they draw up their scheme, and that there is no doubt that they will draw up such a scheme. The Minister then refused to accept a very simple amendment stating that the Government "shall" draw up the scheme instead of "may" draw up the scheme. The word "may" in the Bill suggests that there is no time limit as to when the scheme should be drawn up and the regulations laid. The word "may" is quite indefinite. Even if the word "shall" were included, there would be no timetable and the Government would still have plenty of time in which to decide when to bring in such a scheme.
Having given all those assurances, the Minister appears to have doubts as to whether or not there will be a scheme. Are the Government finding it difficult, or almost impossible, to draw up a scheme, or schemes? This is an important point. Will there be one scheme for the whole of Scotland, or will there be different schemes for different parts of Scotland? Will there be one set of regulations for one part of Scotland and another set of regulations for another? The Minister's reply is most disappointing. This is one occasion upon which he could have said, "Yes", and received a certain amount of credit for it. Further-more, he would have given away very little of substance, unless it is that "may" means that the Government do not quite know what they are going to do about it and are still holding so many discussions that they may end up by not even having a scheme.
Lord Gray of Contin: The noble Lord is being less than fair. We should have been very strongly criticised if we had not prepared regulations and agreed that there should be further consultation upon them. I do not envisage that the draft regulations will be available before the early summer. There will then be a period for further consultation. We should then aim to lay the regulations before Parliament in the autumn and the scheme could be brought into operation then. Or there might even be advantage in delaying its introduction until the beginning of the following financial year. But I can assure the noble Lord that there will be further consultation. I believe that it is better to deal with this matter without too much haste. I trust that my explanation has satisfied the noble Lord.
Lord Mackie of Benshie: In view of some of the legislation which the Government have produced, in this case I must disagree with the noble Lords on the Opposition Front Bench. I should like to see the sort of mess they will make of it when the regulations are produced before committing the Government to producing a scheme.
Lord Ross of Marnock: That is very unfair. I dread to think that this House will be subjected to the mess which the Government will make, but we shall come to that problem later. The Minister has told us that the Government will introduce a scheme. It was included in their manifesto, and that declaration was accompanied by the blowing of trumpets. But what do we find? We find that,
"After Section 17 of the 1980 Act there shall be inserted the following words".
190
And what do "the following words" say?—that the Government may do something. It does not say that they are going to do something; nor does it say that they shall do something. No statutory fetters are being bound around the necks of this willing Government to introduce the right to carry out repairs. It just says that they may introduce this right. How can anyone justify that? How can anyone justify the retention of the word "may"? We are seeking to help them with their manifesto commitments by inserting the word "shall".
What if they had gone to the Scottish people? They did not get many votes when they did go to the Scottish people; certainly they did not get very many seats. They did not say, "We may introduce this scheme". Perhaps this is where the noble Lord, Lord Gray of Contin, went wrong. If in Ross and Cromarty—or whatever its new name is these days—he had said, "We may introduce this", he might have won. Instead of which, he was far too definite and he lost.
Is that the reason for all of this? It is absolute nonsense and the sooner the noble Lord rises to his feet and tells somebody at the Scottish Office to pull their finger out, the better. If they are going to do it, then make it mandatory upon the Government. After all, there might be some sudden change of government and another government may have a different point of view. They will feel under no obligation, and they will be under no obligation because "may" means that one may not do something as well.
This is very disappointing. I can see a very gloomy future for the noble Lord as a Minister of State. This is not what we expected of him. It may well be that he has been taking the advice of the noble Lord, Lord Lyell. I am perfectly sure that he did not take the advice of his noble friend Lord Selkirk, because the noble Earl knows quite well that if one wants something done, one makes it mandatory upon the Government to do it.
One cannot make something mandatory by using the word "may". There was time when I would have argued for at least three and a half hours on the subject of "may" and "shall" in the Scottish Grand Committee. I always considered that my greatest achievement in the Scottish Grand Committee of old was to bring the noble Lord, Lord Boothby, into that committee for the first time at five o'clock one morning. Mind you, he had been pairing off for term after term with John Strachey, so he was just as big a sinner so far as that was concerned.
The use of the words "may" and "shall" is important here, because they are not equitable. I have heard governments argue that "may" means "shall". If it does, then they should use the word "shall". If they want to get the best out of their manifesto commitments, they will not do so with the word "may"; nothing could be weaker. I hope the Government will think again about this point.
On Question, amendment negatived.
Lord Mackie of Benshie Lord Mackie of Benshie moved Amendment No. 10:
Page 5, line 5, after ("scheme") insert ("which shall not affect existing common law rights").
The noble Lord said: I will not take very long to move this amendment. We do not believe that the

191
existing phrase in Clause 7 does mean that common law rights will be affected, but we should very much like to hear the Government's opinion. I beg to move.
Lord Gray of Contin: The noble Lord has asked me to explain what the Government have in mind and I shall try to do so as briefly as I can. Under common law, landlords are obliged to maintain their property in habitable or tenantable condition. Landlords may also have additional responsibilities with regard to repairs under the terms of their tenancy agreements with their tenants. If a landlord fails to carry out a repair for which he is responsible, after due notice from the tenant that the repair requires to be undertaken, the tenant has a right at common law to withhold his rent until the repair has been completed—unless such action is expressly excluded by the terms of his lease. In appropriate circumstances the tenant can, if he wishes, carry out the repair himself and offset the cost against the rent retained.
These common law rights can, however, be difficult and costly to enforce. A tenant who withholds his rent in order to pay for a repair may, for example, find himself being sued by his landlord for the outstanding rent and could find himself in considerable difficulty if the court subsequently holds that he did not have the right to withhold his rent and to carry out the repair himself—either because the repair was not necessary or because he did not give his landlord adequate opportunity to carry out the repair himself.
The proposed new scheme, which will be entirely optional, will not affect these common law rights in any way. Rather, the scheme will extend the existing rights of tenants under the Tenants' Charter by giving tenants who wish to do so the right to carry out repairs for which their landlord is responsible and to claim a payment from the landlord for having done so. This right will be exercisable whether or not there has been a delay by the landlord in carrying out the repair and will not be subject to the uncertainties which attach to a tenant's common law rights.
I can assure the noble Lord therefore that it is unnecessary to seek to preserve the common law rights of tenants in the way proposed in his amendment. Tenants' common law rights are not affected by the Bill, and I hope that in the light of this assurance the noble Lord will be prepared to withdraw his amendment.
Lord Wilson of Langside: In view of what the Minister has said, why not insert the words proposed and put this matter beyond doubt? I was tempted when moving my own amendment, Amendment No. 8, to go on to say in reply (but because of the hour I resisted the temptation and kept quiet) that one of the primary objects of legislation should be to enable people to avoid being involved in situations in relation to which the law is in any doubt at all. What harm would it do to insert the proposed words and to put the matter beyond all doubt?
Lord Gray of Contin: I am always a little apprehensive about arguing legal points with the noble Lord, but I have so often had it put to me, both in this House and in another place, that in legislation it is desirable
192
to have as few words as possible; and this frequently from members of the noble Lord's profession. I am surprised that the noble Lord suggests that it would be an advantage to insert additional words. The words proposed would not add anything to this Bill. I have explained that the rights are not affected; and with those few words I will ask the noble Lord to withdraw his amendment.
Lord Mackie of Benshie: I thank the noble Lord the Minister for his explanation which is of course reassuring. I do think that my noble friend has something in that a few extra words might make it absolutely clear that the rights are not affected. One might have to wait a very long time for a landlord to pay the money that is owed to a tenant, and in the meantime he could be taking advantage of the common law requirement.
Lord Ross of Marnock: Before the noble Lord withdraws his amendment, should he now take up the Minister on his point about the number of words in this Bill? Does what the Minister said mean that between now and Thursday he will look at his amendments to Schedule 8 of the Roads (Scotland) Bill? It began life with 25 pages. When we started with it in Committee it had 50 pages. There are amendments on the Marshalled List to increase that number by another 10 or 20 pages. We will take the noble Lord up on the point he made. He has to appreciate that we mark every word that he says as a Minister and we will use it against him.
Lord Mackie of Benshie: I must say in reply to the noble Lord, Lord Ross of Marnock, that I wholly agree with him. However, at the present moment my stomach is beginning to tell me that at the present time the use of words in this Committee is what I most want to cut down on. At this point I should like to withdraw the amendment, although we may bring it forward again later.
Amendment, by leave, withdrawn.
7 p.m.
Lord Wilson of Langside Lord Wilson of Langside moved Amendment No. 11:
Page 5, line 12, leave out ("to recover from the landlord such sums") and inert ("to have the right to arrange for the cost of such repairs to be recoverable directly from the landlord").
The noble and learned Lord said: As the matter presently stands as regards repairs, the Bill entitles a tenant, after carrying out repairs, to recover the cost of those repairs from the landlord. The purpose of this amendment is to improve the tenant's right in this context and to put him into the position in which arrangements could be made for the cost of the repairs to be recoverable directly from the landlord. I should have thought, in the context of the kind of situation in which tenants under this scheme will be placed, that it would be commonsense to put them in this improved position. I think that the tenant's position should be made quite clear.
Referring to the previous amendment, the Minister said that he had often been told that the object in legislation should be to keep words to a minimum. That is a general rule of guidance and we must

193
certainly try to strike a balance in the matter. He said that sometimes members of my profession expressed this view very strongly. My anxiety is to make the position clear and to leave no doubt that the arrangement which is made will ensure that tenants will not be prejudiced by any delay on the part of the local authority in meeting the cost. One can imagine all kinds of situations, particularly with local government housing authorities, against which tenants should be protected. It is in order to give this additional protection and to put the matter beyond any doubt that I put forward this amendment. I beg to move.
Lord Gray of Contin: The noble and learned Lord has argued that the amendment would help poorer tenants, and I certainly have some sympathy with this aim. I believe, however, that there is an objection in principle to requiring the landlord to make payments direct to a contractor, since it is the tenant who will be responsible for carrying out the repairs. It seems to me only fair that if a tenant has undertaken to carry out a repair himself and is responsible for selecting and appointing a contractor and for supervising his work, then the tenant should also be responsible for paying him. The arrangements between a tenant and his contractor are a matter for them alone. It is right that the landlord's responsibility—and, therefore, the payment—should be to the tenant.
There is also. I believe, a practical objection to the contractor being reimbursed directly by the landlord. Under the Government's proposals, the payments under the scheme are to be based on what it would have cost the landlord to carry out the work himself: they are not directly related to what it will actually cost the tenant or his contractor to undertake the repair. The contractor's bill may well be less than the payment set: or it could conceivably be higher. Under the system we propose, this is a matter for the tenant. The important thing from the landlord's point of view is that he will be paying out not more than what it would have cost him to carry out the repair himself. If, however, the landlord had to meet the contractor's bill direct, then I am doubtful whether this system could work.
The noble and learned Lord has drawn attention to the fact that some tenants may feel that they cannot afford to pay a contractor and then wait to be reimbursed by their landlord; and this may inhibit them from exercising their right. I appreciate that there may be a problem here. But I think that the best way to get round this, as we have suggested in our consultation paper, is to set firm limits on the time within which payment must be made to the tenant once the repair has been satisfactorily completed.
I hope that in the light of these comments, the noble and learned Lord will agree to withdraw his amendment.
Lord Wilson of Langside: I am really very unhappy with the Minister's reply. I should perhaps blame myself for not making the points in support of the amendment as forcefully and effectively as I should have done. I am astonished at the Minister's attitude, which has led to the noble Lord, Lord Ross of Marnock, being so highly critical of him, and I must say I sympathise entirely with the criticism which the noble Lord directed to him.
194
I had hoped that here again the Government would be willing to take another look at this situation, the practical implications of which are very complex and could be very difficult indeed for tenants to resolve. However, in view of the lateness of the hour, I beg leave to withdraw the amendment, and the matter can perhaps be brought up again at a later stage.
Amendment, by leave, withdrawn.
7.6 p.m.
Lord Carmichael of Kelvingrove Lord Carmichael of Kelvingrove moved Amendment No. 12:
Page 5, line 34, at end insert ("and
(c) may provide information of the landlord's obligations in respect of repairs generally and list the type of repairs covered by this section.").
The noble Lord said: The purpose of this amendment is to have a list, a schedule, or at least information available so that tenants will know precisely the sort of repairs that should be done and which are the duty of the landlord. I move this amendment very conscious of the fact that there are great difficulties. As I said on Second Reading, I believe that minor repairs or running repairs on houses—or what is known in the trade as "jobbing building"—is an incredibly difficult matter to handle, whether public authority or in the private sector. However, the state we reached in Scotland, particularly in the big cities, with the housing stock was such that the Government—originally a Labour Government and later a Conservative Government supported by the Labour Opposition—made grants to endeavour to make up for the lack of repairs, something that had been neglected for decades in the housing stock of Scotland.
Many millions of pounds have been spent on repair grants, and I hope that the Government will see the importance of trying to maintain the property that has now reached a reasonable level of repair, and will take a lesson from the fact that over the past 20, 30 and 40 years there has been such neglect that in regard to any new houses they will stipulate clearly what repairs should be done. We must never again reach the stage we had immediately after the war, and particularly in the last 10 years, when massive repairs were required in so many houses. Practically no type of house—no matter how expensive, but particularly the expensive tenement flats—did not need some sort of expensive repair.
I believe that had there been available an understandable and easily comprehensible list of the sort of repairs that were the responsibility of the landlord, it would have taken away a great deal of doubt. People would either have known that a particular job was the responsibility of the landlord and pressed him to do it, or could have gone ahead much more quickly and perhaps done it for themselves if they thought it was a job for them. Therefore, I am not moving this amendment purely in terms of the present Bill; I am thinking of the future and the lessons that we should have drawn from the past.
I should like the Government to grasp this nettle. I agree that it is a difficult subject. We have a comprehensive list of landlords' repairs that should be included which has been submitted by a number of bodies, and particularly again by Shelter. It includes

195
roof and chimney, walls, brickwork, stair rails, incinerators, fire bricks, grates, lavatory basins, sinks, baths and showers—all these things. As I said, it is a difficult nettle for the Government to grasp. Someone will have to do it at some point. The quicker the list is set down in an easily understood form, the better.
I understand that Section 41 of the English Housing Act 1980 gives English and Welsh tenants statutory right to information. All we ask is that by accepting this amendment the Government will extend these rights to Scottish tenants. If the Minister cannot give us an answer right away, the matter is sufficiently serious and important for him at least to say that he will take it away, look at it and come back at the Report stage with something more tangible than he might have been willing to give us earlier. I beg to move.
Lord Gray of Contin: As the noble Lord has explained, the amendment is designed to ensure that tenants have a clear idea of which repairs their landlord is responsible for and of whether they have the right to carry out a particular repair themselves under the new scheme. It will of course be necessary to make clear in the regulations which repairs fall within the scope of the scheme and which do not. It is our intention, however, to do this by means of broad descriptions of classes of repair which are excluded from the scheme, rather than by means of a list of specific repairs—for example, the replacement of a door frame—which are included. The reasons for this are that there could be no guarantee that a specific list would be fully comprehensive, and the nature of a specific repair can vary considerably according to the circumstances. Repair of a wall, for example, could cover anything from repairing a small hole in the roughcast to repairing a large crack caused by subsidence.
Our consultation paper proposes that repairs to the structure of blocks of flats or maisonettes and repairs to communal services or facilities should be excluded from the scheme. It also proposes that repairs which would cost the landlord more than a certain minimum sum or more than a certain maximum sum should be excluded. The consultation paper suggests that the cut-off points might initially be set at, say, £20 and £200. We are currently reviewing this list of exclusions in the light of the responses which we receive to our consultation paper. The second part of the amendment of the noble Lords, Lord Ross and Lord Carmichael, thus seeks to provide for something which we fully intend to provide for anyway.
In conclusion, I believe that the first part of the noble Lords' amendment would be impracticable, and, as I have tried to explain, I believe the second part is unnecessary since we fully intend to include information of the type in question in the regulations. I hope, therefore, in the light of what I have said, the noble Lords will be prepared to withdraw their amendment.
The Earl of Selkirk: If the noble Lord the Minister is to include a list of the type of repairs covered by this provision, why does he not want to put it in the Bill? It is merely outlining the type of regulations. He says
196
that he will include these points. Why does he not agree to include them? I find it rather difficult to follow the reasoning.
I have forgotten exactly what went into the English Bill, but I remember a certain amendment, although I cannot remember where it went in. To my mind it is most important that tenants should know what has to be done. In many cases it is the tenant who reports what needs to be Jone to the landlord, although there are different contracts. There are repairing leases and all sorts of other things.
One of the things which I want to mention particularly is electrical repairs. It is commonly known that most houses which are damaged by fire burn because of electrical breakdown, which is almost impossible to define. This is the sort of fault which tenants should report if they see any sign of it. It is very important that tenants should be fully informed of what the landlord is responsible for and what they are responsible for.
I am not quite clear why there should be a limit to the landlord's responsibility. If a wall is falling down, surely that is a matter that the landlord should see to. I should like this matter to be more fully explained. The maintenance of property is important and it lies in a combination of the tenant and the landlord. I should like the noble Lord to think a little more about this. Frankly, I do not quite see why he objects to the amendment.
Lord Gray of Contin: I think that my noble friend is absolutely right. He and I have exactly the same objective. That is why we are determined to make it absolutely clear what can and what cannot be included. But I remind him that this is an enabling power. When they are produced the regulations will contain all the information which the noble Lord, Lord Carmichael, seeks to have included. But, with respect, it is unnecessary to include all this in the Bill. It will be included in the regulations. I have tried to outline as clearly as I can how we are proceeding. We are consulting as much as we possibly can. We are waiting for observations on the consultation paper. We shall take into account those observations and what has been said in another place, and indeed here. We seek to clarify the position beyond all doubt. I hope that that satisfies my noble friend.
Lord Carmichael of Kelvingrove: The Minister has to some extent satisfied me, although he has left a great number of questions unanswered. In fact he almost himself raised questions which he has left unanswered: for instance, what happens when it is a major structural repair? We know that that point was partly covered by the fact that the liability would be somewhere between £20 and £200. I assume that there will be some way of keeping pace with inflation and changing times. Buildings last a long time. In 20 or 30 years, £200 could look very silly. I am not even sure whether a great deal would be done now by many-builders for £200.
I should also like an assurance from the Minister which he has not quite given me. To some extent this ties in with one of the points made by the noble Earl, Lord Selkirk, when he spoke about the English and Welsh conditions. It is important that people know exactly what their responsibilities are. I have no

197
worries at all about giving people responsibilities. I think that the problem has always been that people have never known what was their responsibility and what was the landlord's, and what they should or should not do. By and large, when people are told that they have certain responsibilities they tend to carry them out. I hope that the Minister can assure us that in the very important matter of tenants knowing where their responsibilities lie, Scottish tenants will certainly be no worse off than those in England and Wales.
When we get the lists from the Minister—ultimately from the Scottish Office—I hope we shall have scope in the House to look at them, discuss them, perhaps make a few additions and make them more intelligible than Government regulations sometimes are. I hope that the Minister will reply shortly to the points that I have made. I should then be happy to withdraw the amendment.
Lord Gray of Contin: I think that I can help the noble Lord. Landlords in Scotland have a common law duty to keep their property in "wind and watertight" and in a "tenantable and habitable" condition. In addition, Section 8 of the Housing (Scotland) Act 1966 requires landlords to keep the structure and exterior of their houses in good repair and to maintain in proper working order installations for the supply of gas, electricity and water and for sanitation. With these limited exceptions, however, the division of responsibility for repairs between the landlord and the tenant is entirely a matter for agreement between landlord and tenant. Practice varies considerably from district to district and even within districts where some tenants may be responsible for a particular type of repair while others are not. Some authorities, for example, exempt elderly or disabled tenants from responsibility for certain repairs. It would not therefore be practical to attempt to list the repairs for which landlords are responsible in regulations which are to apply nationally. Tenants should be able to ascertain whether a particular repair is their responsibility or the responsibility of their landlord by reference to the terms of the written lease which their landlord is obliged to issue to them under Section 16 of the Tenants' Rights Act.
The noble Lord also asked me about what the Government are going to list. The Government are going to list the repairs covered by exclusion. As I have explained, this is why the noble Lord's amendment, which seeks to define the repairs covered by inclusion, is not acceptable. I trust that the noble Lord would be prepared to withdraw his amendment.
Lord Carmichael of Kelvingrove: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.21 p.m.
Lord Mackie of Benshie Lord Mackie of Benshie moved Amendment No. 13:
Page 5, leave out lines 35 to 38 and insert—
(" (4) Regulations under this section shall be made by statutory instrument which shall not have effect until approved by a resolution of both Houses of Parliament." ").
The noble Lord said: I beg leave to move Amendment No. 13 standing in my name. All the
198
discussion over the last five or six amendments shows how necessary it is that this matter is not dealt with in a negative manner. We are going through a Bill and we have heard that there is a consultative paper. Consultations are going on but we do not know what the regulations are going to be. It is not good enough to do it by means of a negative instrument. It should be dealt with an affirmative instrument and passed, and be subject to discussion and approval by both Houses. The reason for it is not far to seek. The noble Earl, Lord Selkirk, has just made several points; the noble Lord. Lord Carmichael, has made several points. My noble and learned friend has had a very unsatisfactory answer to the question of recovering costs, and for the tenant to get the bill sent directly to the landlord.
These are all minefields—that is the only word—of trouble. It may well be, when we look at the regulations, that we will think that they will make things more difficult for the tenant; they will introduce a great deal of bureaucracy and make repairs even more expensive and slower. In view of the great importance of the regulations to this clause I think it absolutely necessary that we have a positive instrument, so that we can make sure that we examine these regulations properly. I know that any noble Lord can see that they are examined; but who knows what pressures the House may be under when the regulations lie on the table? I beg to move.
Lord Wilson of Langside: I hope that the Minister will give serious consideration to this amendment. After all, here we are dealing with provisions entitling a tenant under a tenancy to carry out repairs to the property in which he is a tenant which the landlord is under an obligation to carry out. The implications of this, right at the beginning, are considerable. The legal implications are considerable. The practical implications may very well be even more considerable, and I would have thought that it was quite vital that regulations of this somewhat novel nature should be dealt with in accordance with the amendment, rather than, as is at present proposed, under the negative resolution procedure. I hope the Minister and the Government will give serious consideration to this—more serious consideration than appears to me to have been given to many of the very sensible amendments that have been moved this afternoon and evening.
Lord Ross of Marnock: I would have thought that the Minister of State would have accepted this amendment because it would have meant, of course, that it would have come back here. Otherwise I think there is little chance of this Chamber seeing it. Usually with negative resolutions if the matter is dealt with in the one place, then that is it, finished. We do not get the chance of having any discussion upon it.
If this amendment were accepted it would mean that the Government would need to bring the matter back here and get our approval. I can almost hear the Minister telling us, "Oh ye of little faith; here we are, I have got to these amendments. Do you remember when we had the debate on 'may' and 'shall'? I asked you to trust the Government". And he would be giving us it right back in our teeth that they had done it.

199
I do not think that there is the slightest doubt about the importance of this, and I want to see this carried into law, and carried into law well. But if anyone tomorrow asked me about these regulations and what is going to be done, I would have to say that I do not know. All the Minister has taken here is an enabling power and we are given very, very scant information about what is going to be. It is all in some consultation document sent out—was it in the month of November?—I thought the replies were to be in by the end of the year. But here we are, very nearly into April, and we are no further forward. I have known Parliaments that would have insisted that they see these provisions in draft so that we would have an indication as to what we were actually passing and what the Government were going to do. Now he tells us, "Oh, its all right, we are going to define in a negative way what it is not going to be possible to repair". I suppose the rest will be repairs within a financial limit. Let him watch his words by the way. He used the word "minimum" when he did not really mean it: it had to be "less than". Was it less than £20? Not more than a minimum. He got his £200 right but the first one was wrong. He can check Hansard for that and put it right. But it means that we just do not know what is between this £20 and £200. We do not know what the legal implications are for the tenant who undertakes repairs himself. After all, the house is not his, it is the local authority's. I presume the local authority is covered by insurance, and if anything happened—say it was an electrical installation and some change had been made there by the tenant—is the local authority going to take responsibility for that, just by the fact of paying for it?
There is a lot more in this than we have been able to even scratch in our discussion tonight. I am going to suggest to the Minister of State that he and his civil servants get down to this because we will need to give far more of a keelhauling to this at the next stage of the Bill, when we are not being so pressed for time to deal with other matters. At this late stage we cannot do justice to the importance of it. It is the Government who proclaim this as important—so important they put it into their manifesto. This is going to affect far more people than the right to buy. Some 887 local authority houses—about a million altogether if you take all the others. Of that, 44,000 have bought; but the number of them who will be wanting repairs done is 99 per cent. of that figure. I had something today from the City of Edinburgh district, and they talked about 250,000 repairs in a year.
Each tenant will want to know what he can and what he cannot do, and whether or not he will be served well under the legislation. I have already come to the conclusion that very few will be able to obtain the benefit of it. Whether they do the work themselves or get a contractor to do it, they will have to meet the bills and then wait for some considerable time before they get their money back. We can count out every single old-age pensioner. Unless the Minister devises some kind of scheme such as was put to him by the noble and learned Lord, Lord Wilson, it will be a non-starter so far as many of the poor people are concerned.
Those are only some of the points in respect of this aspect of the Bill, and I am very disappointed that the
200
Government will not accept the amendment so that we have the opportunity here to see the regulations. It may be that we would be delighted with what was being done and that we would be full of congratulations for the noble Lord, Lord Gray of Contin, if he was still in his post, though by then it might have been taken by the noble Lord, Lord Lyell, as the Scottish adviser to the Government. But whoever is in the post, he may well be deserving of congratulations.
Yet the noble Lord is to deny himself the chance of hearing the words of wisdom from the noble Earl, Lord Selkirk, about how the Government have carried out their duties and their promises as to what they would or would not do in respect of the regulations. We are anxious to help the noble Lord. We are anxious to congratulate him. if appropriate. But, above all, we want to see whether the regulations match the needs of the million people who will be depending on getting their repairs done much more efficiently. I support the amendment.
Lord Gray of Contin: I have listened carefully to what the noble Lord, Lord Mackie of Benshie, had to say and to the contributions made by other noble Lords. However, I do not accept that it would be appropriate to make the regulations setting up a right to repair subject to affirmative resolution procedure. Generally speaking, in recent years it has been the practice to restrict affirmative resolution procedure to cases where the powers are concerned with the alteration or definition of the extent of a statute, or with the levying, application, or management of public money. If too many instruments were made the subject of an affirmative resolution, the purpose of delegating legislative power would be largely defeated by the time expended in directing the attention of your Lordships' House to the subordinate legislation.
The noble Lord, Lord Ross, said that there would be no way in which your Lordships' House would have an opportunity to debate the regulations under negative resolution procedure. But that is not so; it is a decision for your Lordships as to whether your Lordships' House debates the regulations. A debate will be held if the regulations are prayed against, and that is the difference between the procedures.
The negative resolution procedure means that the regulations would be laid before both Houses, but would not be debated unless they were prayed against. If affirmative resolution procedure were adopted, the regulations would have to be debated by both Houses, though they would still not be capable of amendment. What is more, if this amendment were accepted, it would mean that every subsequent minor change or adjustment to the regulations—for example, regulations amending cost thresholds in line with inflation—would also have to be debated by both Houses.
The substantive features of the right to repair scheme are set out in Clause 7 of the Bill. The regulations will be concerned with the detail of its operation—important as these are. I can understand the desire of noble Lords to comment on the regulations and I should therefore like to confirm the undertaking given in another place by my honourable friend the Under-Secretary of State with responsibility

201
for home affairs and the environment that we shall make available to interested parties a draft of the regulations before they are laid. This will ensure that there is an opportunity for interested parties, including noble Lords, to comment on the detailed regulations in draft and then for us to take account of those comments before the regulations are formally laid before your Lordships' House. In view of the explanation that I have given, I trust that the noble Lord might be prepared to withdraw his amendment.
Lord Mackie of Benshie: I have listened to the explanation, which was given in the Minister's usual kind and pleasant manner, but I must say that I am not really convinced that this is not an exceptional case. The noble Lord, Lord Ross of Marnock, put forward the fact that the regulations will have a very much greater effect on far more people than will the main object of the Bill. Clause 7 does not give a tremendous description of what is proposed in the way of regulations; it cannot give a tremendous description. For us to go through the clause knowing that we may not see or debate the regulations that are to affect so many people makes me disinclined to withdraw the amendment.
On Question, amendment negatived.
Clause 7 agreed to.
7.36 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 14:
After Clause 7, insert the following new clause:
("Provision of information about tenancies.
. After section 17 of the 1980 Act there shall be inserted the following section—
"Provision of information about tenancies.
17B.— (1) Every body which lets dwelling-houses under secure tenancies shall, within one year of the commencement of this section and thereafter from time to time, provide information in such form as it considers best suited to explain in simple terms

(a) the provisions of this Part of this Act;

(b) the provisions of the Matrimonial Homes (Family Protection) (Scotland) Act 1981;

(c) the provisions of section 8 of the Housing (Scotland) Act 1966;

(d) the rights and obligations of landlords and tenants at common law in respect of the repair and maintenance of houses let under secure tenancies;

(e) such other matters as the body considers appropriate.

(2) Every such body shall ensure that, so far as is reasonably practicable, the information provided by it under subsection (1) above is kept up to date.
(3) The landlord under a secure tenancy shall supply the tenant with a copy of the information provided by it under subsection (1) above as soon as practicable during the period of one year following the commencement of this section and after the expiry of that period—

(a) when the tenancy is created; and

(b)when information is revised in accordance with subsection (2) above.".").

The noble Lord said: At this late hour I shall be very brief on this amendment. The other day I listened with considerable admiration to the noble and learned Lord, Lord Simon of Glaisdale, on the subject of the intelligibility of statutes and to his suggestion that before a particular statute comes into force there should be a certain measure of consolidation that would enable people to understand what was happening. Unless people understand the whole business of their right to buy and their right to repair, then obviously they will not properly and efficiently be able to take advantage of the new rights given to them.
So in the amendment we are proposing something entirely different—a right to information. We place an obligation on the body which is the landlord of the house. It might not be a local authority; it might be a new town corporation, the Scottish Special Housing Association, or some other such public body. The obligation is that the body should vouchsafe information to its tenants—information which will enable them to understand their rights and therefore be able to exercise them. The matters on which information is to be provided are listed in subsection (l)(a) to (e) of the new clause proposed in the amendment. The first paragraph refers to,
"the provisions of this Part of this Act".
Well, we do not know them at the moment. The Act will come into force two months after it is passed and I do not know whether the regulations will be drawn up by that time.
The amendment goes on to refer to,
"the provisions of the Matrimonial Homes (Family Protection) (Scotland) Act".
That is very important from the point of view of many people who try to exercise their rights under that Act, which are now partly incorporated within this Bill in terms of secured tenants.
Then the amendment refers to,
"the provisions of section 8 of the Housing (Scotland) Act".
My noble friend mentioned that when he spoke about the common law rights of tenants as against landlords. Very few people know about that. There is no doubt that the reference there is to Section 8. We are not talking about the rights which arise from the variable leases that the Minister of State spoke about.
The amendment then refers to,
"the rights and obligations of landlords and tenants at common law in respect of the repair and maintenance of houses let under secure tenancies",
and,
"(e) such other matters as the body considers appropriate".
Subsection (2) states:
"Every such body shall ensure that, so far as is reasonably practicable, the information provided by it under subsection (1) is kept up to date".
That is important. Subsection (3) states:
"The landlord under a secure tenancy shall supply the tenant with a copy of the information provided by it under subsection (1) above as soon as practicable during the period of one year following the commencement of this section and after the expiry of that period—"(a) when the tenancy is created".
This is information to enable the tenant to know his rights and to assess what he should do under them. It is not placing any burden on the Government. We are placing the responsibility on the local authority. People have a right to know. If they know, they will probably be able to assess what they should do in respect of the tenant's right to buy and the tenants' right to repair. I beg to move.
Lord Gray of Contin: This new clause would require authorities to provide tenants with more and clearer information about their tenancies. I have some sympathy with the aims of the amendment, but I cannot accept that the administrative and financial burden for local authorities which would result from this amendment would be justified. The 1980 Act already requires authorities to provide tenants with a

203
written lease which must set out the terms of their tenancy. This is all that the great majority of tenants will ever need. The additional information which the new clause would require authorities to issue to their tenants would, given human nature, lie undisturbed and unread until a particular dispute arose, and again, given human nature, that dispute would almost certainly be sui generis and not covered by guidance provided by the authority. Local authorities employ skilled housing managers, and Citizens' Advice Bureaux and housing aid centres have many years' experience of assisting tenants with problems. The additional information referred to in the amendment would in itself solve no problems. It would, I suggest, be little used by tenants and would impose additional burdens on housing management staff who, I am sure, have many more pressing problems with which to deal. I hope that in the light of these comments, noble Lords will agree to withdraw their amendment.
Lord Ross of Marnock: There is no doubt about what the noble Lord said. He touched upon a very sensitive point concerning housing management staff who will have plenty to do. It is interesting that, according to the Government's own introduction to the Bill, they were not going to have much to do. It says:
"The introduction of a right to repair is unlikely to have any significant financial effects. There may be some unquantifiable but minor manpower implications for housing authorities".
Either the Minister believes that or he does not. It was because I believed it was true that I felt that we could reasonably place this burden upon local authorities. I am now told, however, that it is not true. They have so much more to do that they cannot possibly undertake this obligation. I recall a friend of mine going to a local council about some important matter. The council oozed sympathy, to which my friend replied: "It's no' your sympathy we want. It's action". The same goes for the Government. We want action to enable the million people who are in local authority and public authority housing to know what their rights are.
I thought that the Government might have welcomed the fact that we were justifying expenditure to proclaim how they had covered their manifesto commitment in respect of tenants' rights to repairs. Evidently not. The Government are concerned about the expense. I love the way that one minute local authority tenants are great, proud people, needing all these rights and the rest, but who then become people who really do not matter. They allow everything that affects them to lie somewhere and they do not read about it.
I wish that the Minister would make up his mind about local authority tenants and decide whether they are worthy citizens who pay attention to what that local authority puts through their doors. Evidently, however, now that we are coming to the end of the Bill, they are not really good tenants after all. They do not read anything until something happens, when they can go to the Citizens' Advice Bureaux. The Government have always underestimated local authority tenants. At the same time, I do not want to overestimate their ability to weave their way through their rights in respect of this legislation and particularly in respect of
204
regulations that we have not yet seen. We do not know what is to come. I shall not, however, delay the House at this late stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 agreed to.
Clause 9 [Citation, commencement and extent]:
On Question, Whether Clause 9 shall stand part of the Bill?
Lord Ross of Marnock: May I ask the Government whether we are to see the regulations before the Bill actually comes into force under Clause 9; that is, two months from the day that the Act is passed? Surely, by that time we shall have the regulations.
Lord Gray of Contin: As I explained at an earlier stage, we shall have draft regulations by that time, but I cannot give the noble Lord any guarantee that we shall have the final regulations because when we produce the draft regulations we shall give an opportunity for further consultation. I am sure that the noble Lord would agree with that. Having received comments on the draft regulations, we shall take those into account before producing the final regulations. We shall therefore not have them within that period.
Clause 9 agreed to.
Schedule agreed to.
House resumed: Bill reported without amendment.

Recreational Gardening Bill [H.L.]
7.48 p.m.
Lord Wallace of Coslany: 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 Wallace of Coslany.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD AYLESTONE in the Chair.]
Clause 1 [Duty of certain councils to provide allotment gardens]:
The Deputy Chairman of Committees (Lord Aylestone): I should point out that the correct wording of Amendment No. 1 is as follows:
"Page 1, line 8, leave out from ("and") to end of line 11 and insert ("in exercising their duty under the Allotments Acts 1908 to 1950 to provide allotment gardens shall take into account the number of persons on such a register." ").
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 1:
Page 1, line 8, leave out from ("and") to end of line 11 and insert ("in exercising their duty under the Allotments Acts 1908 to 1950 to provide allotment gardens shall take into account the number of persons on such a register." ").
The noble Lords said: I apologise for the error. The final section of the amendment is in line with the

205
original part of Clause 1. The amendment amends Clause 1 so that it merely requires allotment authorities to maintain a register of prospective allotment tenants and to take into account the number of persons on such a register in exercising their duties under the Allotments Acts. Clause 1 as originally drafted was criticised right, left, centre and middle by all sections of those who spoke in the House, except myself. I recognise that criticism and accept it. I thank noble Lords for it. Now we have this amendment which is a simple amendment and which is really a paving amendment to the rest of the Bill. I beg to move.
Lord Beaumont of Whitley: I should like to congratulate the noble Lord, Lord Wallace, on the series of amendments that he has brought before the Committee this evening because they very much improve the Bill. Amendment No. 1 in particular meets a point which, as the noble Lord has said, was raised in several parts of the House and it was the only serious fault that we on these Benches found in the Bill. We are delighted that the noble Lord has been able to amend the Bill in this thoroughly satisfactory way.
Lord Graham of Edmonton: I should like again to support the good sense of those outside the Committee who clearly have assisted my noble friend Lord Wallace in seeking to improve the Bill at all stages. Of course there will be other stages after tonight and—who knows?—when a wider audience looks at what we have done tonight, there may be even more improvements on the way.
I take the point made by the Minister on Second Reading about the disparity between the treatment of people waiting for houses and people waiting for allotments which, under the original wording of the Bill, could certainly have appeared to imply that there was a greater urgency or priority to provide allotments for people who wanted allotments, than houses for people who were waiting for houses. This amendment quite clearly applies a little brake on the wideness of the area over which it is possible to lay down duties on authorities to provide allotments. Therefore, we from the Front Bench will certainly support the amendment.
Lord Skelmersdale: As has already been referred to, it is an open secret that, during the debate on Second Reading, the Government displayed little enthusiasm for the Bill. Indeed, the noble Lord, Lord Wallace, was disappointed that he did not seem to be getting "goodwill from the Government". Instead he said:
"I am afraid that they rather stunned me with a bucket of cold water".—[Official Report, 24/2/84; col. 1029.]
Nevertheless, I am pleased to see that, in coming forward today with these amendments, the noble Lord has heeded my words about some of the failings of the Bill. I recognise that the noble Lord has done what he can to make the Bill more acceptable and I am grateful to him for his efforts. I still have doubts about the need for such a Bill and I am not entirely happy with all the amendments. But the noble Lord may be reassured to know that the water is not quite as cold as it was previously.
206
As regards this particular amendment, the Allotments Acts 1908 to 1950 already place an obligation on local authorities (but not the inner London boroughs where the duty is discretionary) to provide "a sufficient number" of allotments where the authority is of the opinion that there is a demand for them, and waiting lists are, of course, a main way of assessing demand. As, however, the statutes are not specific about the extent and nature of allotment provision, it is appropriate that each authority should be free to decide for itself what proportion of its resources to devote to this purpose, bearing in mind the availability of land and all other demands on the finite resources which are available.
The amendment that is proposed improves the clause considerably but, as in Amendment No. 3—which we shall reach a little later—we are still averse to additional statutory duties being imposed on local authorities.
Lord Wallace of Coslany: I shall not say much about that. The Goverment are, I think, beginning to relent a little. If the noble Lord looks at Amendment No. 3 which arises in Clause 3, he will see that we have taken account of the new Government reorganisation and that, of course, includes inner London boroughs. Apart from that, I take on board what the noble Lord has said. I do not think that there is any need for me to think of further amendments. I will trust in my luck and no doubt trust that the Government will have a nice kind heart in due course. We shall have to wait and see.
On Question, amendment agreed to.
Clause 1, as amended, agreed to.
Clause 2 [Accounts and application of receipts]:
7.54 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 2:
Leave out Clause 2 and insert the following new clause:
("Application of monies and receipts
2. Monies and receipts which fall to be applied in accordance with section 32(2) of the Small Holdings and Allotments Act 1908 (sale of superfluous or unsuitable land) shall not be applied for purposes other than allotment garden purposes except where the auditor appointed for the purposes of section 15(3) of the Local Government Finance Act 1982 (general duties of auditors) has certified that allotment garden needs have been met.").
The noble Lord said: I beg to move Amendment No. 2 as listed on the Marshalled List. I accept that there was a great deal of difficulty as regards this provision and it was severely criticised by the noble Lord, Lord Skelmersdale. My friends and I have done our best to try to meet the suggestions and criticisms that the noble Lord made. I could in point of fact speak at great length on this amendment, but I do not intend to do so.
The amendment rewords Clause 2 so that when superfluous or unsuitable allotment land is sold or exchanged for more suitable land, the sale proceeds and monies received by way of equality of exchange shall not be used for purposes other than allotment purposes, unless the auditor has certified that allotment needs in the council's area have been met.
Of course there is far more in this amendment than meets the eye, because it brings in the question of charitable foundations and public trust, and the ethical considerations arising directly out of charitable foundations of allotments. Not all allotment gardens are of course just founded by local authorities as such. They are a very important part of the social fabric of urban and village life. Many plots have been in the same family for several generations. Indeed, as I told the House previously, my family is now starting again.
I should like to interpolate at this point that last time I mentioned my secret method of getting bumper green pea crops. It appeared in Garden News last week. I am arranging for stencilled copies of this secret to be available in the Library in due course to all noble Lords. I understand that the noble Lord wants to criticise this amendment severely and I shall listen to what he has to say with great care. I beg to move.
Lord Skelmersdale: As far as giant green peas are concerned perhaps the noble Lord might like to get in touch with the Henry Doubleday Research Association or indeed the National Vegetable Research Association, but I shall leave that matter to him. I am not going to be quite as severe as the noble Lord, Lord Wallace, thinks. This amendment improves the Bill to the extent that it removes the proposed obligation upon authorities to keep separate accounts of receipts and expenditure and the duty which would require them to publish annual accounts. As amended, however, it would require monies and receipts arising from the sale of allotment land not to:
"be applied for purposes other than allotment garden purposes except where the district auditor … has certified that allotment garden needs have been met".
Following the enactment of the Local Government, Planning and Land Act 1980, local authorities have been able to use any of the proceeds arising from the sale of allotment land for other purposes without the consent of the Secretary of State, provided they are satisfied that the money is surplus to allotment needs in accordance with the provisions of Section 32(2) of the 1908 Act. I see no reason for changing these arrangements to the extent proposed by the noble Lord in requiring a certificate from the auditor before the proceeds of sale can be applied for other purposes which I consider to be unnecessarily bureaucratic.
Lord Graham of Edmonton: I rise to support the intention of the clause. It is quite clear that sometimes one does not get the words right. But I am sure that the Minister understands very well the agitation, if not the anger, of many people who want to maintain the existing acreage of allotments, but who are aware of the fact that in this day and age—when there is severe pressure from the Government on authorities to find money from their own resources—there will be authorities who will look with covetous eyes upon the possibility that, by one means or another, they will be able to produce a situation in which it can be said that there is no longer any need or demand for allotments and the land will be sold and the monies will be used to keep down general rating needs.
The Minister and I had an interesting exchange on the Town and Country Planning Act in respect of
208
surplus land from the sale of either hospital sites or hospitals. We on this side of the Committee are very sensitive—and I do not say that it is our prerogative—about the fact that, as long as there is a need for it, we want to maintain land in allotment use. My noble friend, quite rightly, pointed out the charitable nature of many allotments, and yesterday he had a good example of how the charitable base of our society in housing matters is under attack. I would not want to see a charitable base on land under attack. Allotments are very precious to a community. They may not be used by everyone. I hesitate to say that they are part of our heritage but they are part of our tradition. They are very well respected and are used by communities. I certainly support the amendment. Whether it will be resisted, pushed or improved is of course in the hands of my noble friend. But we certainly support the intention that the value of land which ceases to be used on one site for allotments ought to be put into a fund and. unless it is said otherwise by the auditor, should continue to be used for allotment purposes.
Lord Wallace of Coslany: I accept to a great extent the criticism of the noble Lord, Lord Skelmersdale. I thank my noble friend for supporting me in the way in which he has. As the noble Lord, Lord Skelmersdale, pointed out on Second Reading, there was no need to reopen arguments about the Local Government, Planning and Land Act 1980. However, there is a great problem here and there is a danger, because local authorities are under pressure to try to find some way of raising money. I know that it is Government policy to reduce expenditure and I am not arguing about that. Some local authorities may have increased allotment rents to the point of discouraging people from using allotments. When the local authorities reach that situation they can obtain permission to sell the land, which will fetch in a considerable sum, for housing. So there is a temptation there.
I am trying to say that, irrespective of the argument about an audit, there is a clear need for an independent audit to be introduced before allotment monies are diverted to other purposes. I could go into the reasons, but I mentioned most of them in my opening remarks. There may be some other safeguard which could be introduced, and I should be grateful if the Government can tell me their ideas on what the safeguard should be. There must be a safeguard, because I know that many local authorities are thinking in terms of trying to get rid of allotment land in order to use it for housing, which in this day and age is a very profitable business indeed. But I still move the amendment, and I shall consider very carefully what has been said. If we can come to some agreement on an amendment, clearly I shall be pleased to do so.
On Question, amendment agreed to.
Clause 2 agreed to.
Clause 3 [Publication of statistics about allotment gardens]:
8.5 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 3:
Page 2, line 8, leave out ("The Secretary of State") and insert ("The council of a district, parish, community or London Borough").
The noble Lord said: I beg to move Amendment No. 3. This is quite a simple amendment. The clause, as amended, will require allotment authorities to publish an annual statement of the numbers and area of allotment gardens provided by them and of the number of persons on waiting lists. As originally drafted, the clause would have placed the duty on the Secretary of State to publish statistics; but, as the noble Lord, Lord Skelmersdale, pointed out—and he was quite right—the Government would have extreme difficulty in complying with such a requirement.
As allotment statistics are important for planning purposes in preparing a recreational strategy and in assessing the amount of food production from allotments, it is right that allotment authorities should publish a simple statement recording this information annually. It need not necessarily be within one month, but could be at some suitable time. My argument has been reinforced by documents and a letter which I have received from someone—I do not think he is a professor—who is training students in many aspects of gardening. He has experienced great difficulty in obtaining adequate statistics. He quoted two authorities to me and they are about the only two that he could find that had adequate statistics available on all aspects of their allotment gardening activity. Therefore, I am reinforced on this point. I do not think that I need say anything further. I beg to move.
Lord Graham of Edmonton: I rise briefly to support the value of this amendment. I can understand the Minister making noises that the department has enough on its hands. Reference was made during the Second Reading debate to the value of the Thorpe Report. But again there is uncertainty over the precise extent of allotmenteers in the country. In the Local Government, Planning and Land Act, the Government—and this was without our blessing—laid a whole range of additional duties on local government to provide a wide diversity of statistics and information. To the extent that the Government will claim the credit for opening the books and the doors of local authority activities, we are saying, as we said in another place—and I remember saying it myself on the Floor of the House—that the use to which statistics can be put, let alone the basic need for providing statistics on something which, I repeat, is part of a community, is very sound and can be very valuable.
As my noble friend has said, we do not want something elaborate. We merely want a line of statistics among other statistics, so that when one wants to refer authoritatively to the precise position, a local authority will know best and will produce those statistics. Therefore, I support the amendment.
Lord Skelmersdale: On the previous amendment, when the noble Lord, Lord Graham, was speaking about the Bill, I may not have been very clear in my explanation. However, as long as the local authority feels that there is still a need for allotment gardens, even though it was pressurised in the way in which the noble Lord, Lord Graham, suggests, it would then need the permission of the Secretary of State to sell. This was something which was retained in the Local Government, Planning and Land Act, about which the noble Lord has just complained a little. As I said on
210
Amendment No. 1, Amendment No. 3 would still involve increased bureaucracy on the part of local authorities—not departmental staff—at a time when the Government are seeking to achieve, with all the full panoply of aids which they have summoned up, substantial reductions in staffing levels.
Lord Beaumont of Whitley: I do not think that the Government's criticism of this amendment is fair. It seems to me that if one is to have any kind of allotment system at all, the publication of a simple statement of where that system stands from year to year is a basic necessity. It is not to be labelled as "bureaucracy" or "unnecessary"; it is something to which every ratepayer is entitled. I believe that this is a good amendment and a good clause.
Lord Wallace of Coslany: I simply cannot accept what the noble Lord, Lord Skelmersdale. has said. Quite frankly, the Government are overstating their case about local government expense. They must have it on their brains. I wish that they would try to calm down a little over this business of local democracy, and so on. From my experience, this amendment simply needs one efficient junior clerk to keep a simple record of applicants' names and the number of plots that are let, and to publish them from time to time. It would be quite simple. The authorities which do this have the information available, but they do not make it public. If a council do not have any allotments, they do not have to keep records. They can keep records when they have allotments. It is quite a simple matter. Any decent little junior clerk, trained at one of our excellent comprehensive schools, can do the job in only a little part of their time in a year. It is ridiculous to say otherwise.
On Question, amendment agreed to.
Clause 3, as amended, agreed to.
Schedule 1 [Minor and consequential amendments]:
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 4:
Page 3, leave out line 44 and insert ("should have a vehicular access, adequate fencing and").
The noble Lord said: I beg to move Amendment No. 4 standing in my name on the Marshalled List. This is quite simple. Line 44 originally used the word "shall", and the Government and many others objected to it. The amendment now lays down standards to be achieved wherever possible. Circumstances may vary, particularly in rural areas, as far as some of the laid down conditions are concerned, but it is most desirable that standards should be set: that local authorities are still, under the amendment, free to use their initiative and to formulate their own rules. We have now reached the stage where allotment gardens have gone beyond the labouring classes and are becoming a desirable asset for the community at large, for the middle classes and even impoverished noble Lords.
This is done with the best of intentions: to set an example of what we hope to achieve. It is nothing more nor less than that.
On Question, amendment agreed to.
Schedule 1, as amended, agreed to.
Schedule 2 [Repeals]:
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 5:
Page 4, line 13, column 3, leave out ("Section 23") and insert ("In section 30(2) the words "or is resident more than one mile out of the borough, district or parish for which the allotments are provided." ").
The noble Lord said: I beg to move Amendment No. 5. I must confess that when my friends who have been helping submitted this to me, I could not understand what it was all about, so I had to find out. I can tell the Government (in case they have not yet found out) that this amendment does two things: first, it removes the reference to the repeal of Section 23 of the 1908 Act since this section is no longer being replaced by Clause 1 of the Bill, as amended. Secondly, it amends Section 30(2) of the 1908 Act. The situation is this: at present a tenant who moves one mile outside the administrative area of his allotment's authority is liable to forfeit his plot. There is no reason why this should be so; it is totally contrary to the recreational status of allotments. That is why the amendment seeks to give the plot-holder the right to remain on his plot.
There is a further point. Successive Governments —and I blame nobody in particular, although I am looking rather strongly at the Benches opposite—keep changing local authority areas. One chap who has been working away—who probably followed his father and has now got his grandson beginning to help him— suddenly finds his local authority boundary altered. Legally that chap has to lose his allotment, not because he moved a mile out of the area but because the Government moved him by altering the map. This is downright stupid. With all due respect, I do not think the Government realise this. I certainly did not realise the full implications until I began to delve into the details.
My strongest point, surely, is the fact that we keep messing about with local authority areas, and sometimes we do not even know where a certain area is because the name of it has been changed. Something has got to be done and I hope the Government will accept the amendment and assist me to get this Bill passed. I beg to move.
Lord Skelmersdale: I think the explanation for this amendment is rather fuller than that which the noble Lord, Lord Wallace, has just given us.
There are three reasons under which an authority can repossess an allotment: if the rent is in arrears for not less than 40 days; if the tenant has not observed the rules affecting the allotment not less than three months after the commencement of the tenancy; and if the plot-holder lives more than a mile out of the borough, district or parish for which the allotments are provided. So, irrespective of whether there is a change of boundary because of a local boundary commission or whatever, I would certainly accept the need for the repeal of my third reason brought about by the amendment, because it would reflect today's circumstances in which many allotment holders may reside more than a mile from the authority which provides the allotments. For once, I am in full agreement with the noble Lord, Lord Wallace.
Lord Wallace of Coslany: Hooray! I compliment the noble Lord on this result; it is very refreshing. We have now reached the end of it. I do not wish to say any more because I will be completely out of order if I do so. We must now wait until Third Reading.
On Question, amendment agreed to.
Schedule 2, as amended, agreed to.
House resumed: Bill reported with amendments.

Prohibition of Female Circumcision Bill [H.L.]
8.18 p.m.
Read a third time.
Lord Rea Lord Rea moved the following amendment:—
Clause 2. leave out clause 2 and insert the following new clause:
("Saving for necessary surgical operations.)
2. Section 1 above shall not render unlawful the carrying out of a surgical operation on a person if—

(a) the operation is carried out by a registered medical practitioner who is of the opinion that the operation is necessary for the physical health of that person or for the rectification of abnormality; or

(b) the operation is carried out by a registered midwife or a person undergoing a course of training with a view to becoming a registered medical practitioner or a registered midwife on a person who is in any stage of labour or has just given birth and is so carried out for purposes connected with that labour or birth.")

The noble Lord said: My Lords, in the absence of Lord Kennet. I rise to move the sole amendment on the Marshalled List. This amendment replaces Clause 2 of the Bill by an amended clause. It has two main purposes. One is to plug a gap in the Bill left by an amendment at Report stage, and the other is to provide protection and reassurance for those engaged in obstetrics or midwifery.
The gap results from the decision at Report stage to drop sub-sections (1)(b) and (2) of the original Clause 2. These required that any operation exempted from the provisions of the Bill should be carried out by a registered medical practitioner in a National Health Service hospital or registered nursing home. They were taken out because a proportion of births take place at home. Minor surgical operations on the female genitalia are frequently done as part of normal obstetric practice, whether at home or in hospital, by midwives as well as doctors. These operations include episiotomy, which is an incision of the perineum which enlarges the outlet of the birth canal. This needs to be repaired after childbirth is complete, as do spontaneous vaginal or perineal tears. By not specifying who should carry out permitted operations, a possible loophole remains for an unqualified person to operate which might undermine the purpose of the Bill.
Paragraph (a) of the present amendment reinstates the requirement that it must be a qualified doctor who does the operations referred to. Paragraph (b) is included to protect midwives and students of midwifery, whether they be nurses or medical students, when undertaking the obstetric procedures I have mentioned. It affirms that legitimate obstetric practice will be unaffected by the provisions of the Bill. Students of medicine or midwifery carry out these

213
operations only under supervision. But it is proper that their position should be clarified and legitimised. I should mention that, as a medical student and as an obstetric house surgeon, I learned most of my practical obstetrics from midwives rather than from doctors.
I hope that your Lordships will agree that this amendment both tightens the Bill and provides the safeguards which are needed by midwives and their students while practising their professions. I beg to move.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur): My Lords, I will simply say that the Government fully support the aims behind the amendment both in ruling out operations by unqualified people and in bringing in those which may be performed by a midwife while attending a confinement, and say that the amendment is quite satisfactory as far as it goes, but only as far as it goes. It might be appropriate if I said something further about Clause 2 as a whole at a later stage.
Baroness Cox: My Lords, I should like briefly to support the amendment because, as the noble Lord, Lord Kennet, has said, it contains the extra provisions crucial for protecting those other than qualified medical practitioners who might legitimately carry out the kind of procedure to which reference has been made. Without the amendment, midwives, and those training for midwifery and for medical qualifications, would have been in an extremely vulnerable position. Moreover, I understand that the Royal College of Midwives has explicitly welcomed the inclusion of these extra provisions. Therefore, I believe we are indebted to those who have taken account of these considerations and I hope that they will find acceptance.
Baroness Masham of Ilton: My Lords, it has been difficult in the passage of this Bill to find ways of pleasing all the bodies involved, but no one has been against making this vile practice of mutilating young girls and women banned and outlawed. I hope that this amendment is more acceptable to everyone and that at this last stage of the Bill the Government now find it acceptable.
Paragraph (a), as I read it, now brings in the cases that the noble Lord, Lord Glenarthur, was worried about. It says:
"or for the rectification of abnormality".
The abnormality is not defined so that it could be either mental or physical. This should overcome any difficulty that the Minister foresees. I hope that the Minister will consider it, because I have been to several Members of your Lordships' House who put down amendments and to our various clerks and they say that this is the case.
As far as paragraph (b) is concerned, from a nursing point of view Lady Cox has agreed to it, and from a medical point of view the noble Lord, Lord Rea, who is a doctor, has agreed to it. Thus, I support the amendment.
Lord Coleraine: My Lords, having failed to read the amendment correctly at my first attempt, I should like
214
to put down a marker for another place where a further amendment to this amendment might be made. My problem was that there seemed to be two "registered midwives" in new Clause 2(b).
I understand that paragraph (b) is meant to be read in the following way:
"the operation is carried out by a registered midwife"—
comma—
"or a person undergoing a course of training with a view to becoming a registered medical practitioner or a registered midwife"—
comma—
"on a person who is in any stage of labour"—
and so on.
I read it differently. I read it as,
"the operation is carried out by a registered midwife"—
comma—
"or a person undergoing a course of training with a view to becoming a registered medical practitioner"—
comma—
"or a registered midwife on a person who is in any stage of labour"—
et cetera. I have no doubt that this was just the inadequacy of my reading, but I think it would be better if at some stage the word, "either" could appear after the word, "becoming" and before the words, "registered medical practitioner".
Lord Rea: My Lords, I do not take any responsibility for this lack of clarity in the wording. It came back to us in this form after it had been sent to the department for tidying up. As there are no further speakers, I beg leave to move the amendment.
On Question, amendment agreed to.
8.27 p.m.
Lord Kilmarnock: My Lords, I beg to move that this Bill do now pass. In moving this, I had hoped that the noble Lord, Lord Glenarthur, would declare the Government's hand on the Bill during the debate on the amendment, as we are still not fully apprised of the Government's intention.
Moved, That the Bill do now pass.—(Lord Kilmarnock.)
Baroness Jeger: My Lords, before speaking on the Motion, I have listened carefully to what has been said and I very much appreciate, so do all my noble friends, the care and consideration which has been given from all sides of the House to this legislation. I hope that we can count on the Government not only giving the Bill a fair wind but seeing it safely into harbour. I see it, and so do most of my noble friends, as an important Bill, for just two reasons, which I should like to put on the record briefly.
First, there is a growing practice in this country of female circumcision among immigrant communities. Many people say that this has not reached serious proportions yet, but I submit that we must deal with this before it reaches serious proportions. In Sweden it has been outlawed, and also in France, but as to France I remind your Lordships that in the French Parliament the bill followed two tragic deaths of small girls who were subjected to the process of female circumcision and died as a result of this crude operation.

215
The second reason that I hope the Government will see this Bill through to its final stages is that we must support world opinion, as exemplified by everything that we have had from the United Nations, from UNESCO, from the World Health Organisation and from international bodies of nurses, midwives and doctors, which makes it absolutely clear that professionally there is total objection to this procedure.
I must remind your Lordships that any failure here would have a disastrous effect in other countries where enlightened doctors, midwives and leaders are trying to get rid of this procedure. In Kenya for example, where the practice is illegal, there are severe difficulties in implementing the law because of traditional antagonism to change. It takes much courage in some communities for parents to break with traditional circumcising of their daughters. As with the traditional burning of widows in India, abolition in practice will take far longer than abolition in law.
Progress is bound to be slow but the reformers need all possible encouragement, and I submit that it would be a betrayal of their endeavours if our Parliament were to appear less than wholehearted in making female circumcision illegal in this country. They would not understand excuses about the timetable or the technicalities of contentious amendments. Failure to pass this Bill would be regarded as tacit approval, or at least the absence of disapproval. We cannot allow it to be said that female circumcision must be acceptable because the Westminster Parliament has failed to prohibit it.
In this House we have spent over 36 hours in debate, including time last Session. We have had the benefit of advice from Members experienced in medicine and midwifery, from Members with long experience of conditions overseas. I think especially of the noble Lady, Lady Kinloss, and of the noble Lord. Lord Hatch, and many others. We have spent much time in consultation with experts in many fields. We have tried to be constructive in meeting the problems involved, as indicated by the amendment agreed today.
In the view of many of us on all sides of the House, it would be dishonourable if any tactics were to be used at other stages which would endanger the passage of what is surely an humanitarian, non-party and internationally-agreed measure. I would remind the noble Lord, Lord Glenarthur, that on 10th November 1983 at Col. 1000 of the Official Report, he said:
"My noble friend Lord Trefgarne has already stated on the previous occasion, on 21st April, that the Government acknowledge the case for a firm statement in legislation that would put beyond doubt the illegality of the practice of female circumcision."
I am confident that this Government will abide by that undertaking and those of us who I hope will be approving the Third Reading of this Bill tonight can have confidence that the Government, knowing that the proposals we are putting forward are backed by UNICEF, WHO, the British Medical Association, the Royal College of Midwives, the Royal College of Nursing, the National Council of Women, the National Federation of Women's Institutes, the Medical Women's Federation and the International Council of Nurses, can surely do nothing to jeopardise the passing of this Bill.
216
In our view it would be intolerable and disgraceful if the forces of darkness in lands where this mutilation persists were able to pray in aid that the United Kingdom Parliament had failed to make the practice illegal. It would be taken as a de facto endorsement on the grounds that "those who are not against us are for us". I know that this is not the attitude of your Lordships', but I also know that many courageous doctors, midwives. political and social leaders in overseas countries insist that this is the interpretation which could be put on by their enemies. I hope that the Government will not only ensure that this Bill gets its Third Reading in your Lordships' House tonight but that during the other stages nothing will be done to delay its passage. I am sure it will be a good day for this country and for the women of the world if this Bill passes.
Baroness Cox: My Lords, may I speak very briefly to say that I, too, hope most sincerely that this Bill will now go forward without let or hindrance. The principles underlying it have had unequivocal support from all parts of this House. Moreover, matters of complex technicality and detail have been the subject of lengthy and thorough discussion and debate in earnest attempts to ensure that the spirit of the Bill is reflected in the letter of the law.
It would be a tragedy if the Bill were to founder now as many, not only in this country but also abroad, are watching its progress and eagerly hoping for its successful conclusion. Many people would like to express their appreciation to the noble Lord, Lord Kennet, for introducing this Bill and for working so hard to make it acceptable to all concerned, and also to express thanks to my noble friend Lord Glenarthur for all his industry and tenacity.
May I conclude by echoing the hopes of the Royal College of Midwives that,
"this Bill, to end what can only be described as a mutilating procedure, will be speedily passed without amendment through the House of Commons".
Lord Winstanley: My Lords, I am not wholly sure that I am altogether wise not to have withheld my fire until we have heard from the Minister; but as a doctor, irrespective of the views expressed by my noble friends on these Benches, I most sincerely welcome this Bill in its present form. At the outset I want to say frankly, as a doctor, that I rather regret that any Bill was necessary. I would have thought that, so far as the medical profession was concerned, it was clearly the duty of the General Medical Council to deal with people who perform mutilating operations of this kind. That of course leaves the situation when such operations might be carried out by a lay person; and I would have thought that could have been coped with under the Offences Against the Person Act. But obviously something else is necessary and I believe that this Bill meets the situation.
It is my belief that the exceptions which are spelt out in the amendment which your Lordships have now accepted are the only ones which are conceivably necessary. They provide for the odd manoeuvre which is required in obstetrics, as explained by the noble Lord. Lord Rea, and they also provide for operations performed in order to deal with genuine abnormalities and for quite specific medical purposes.

217
Personally. I am very glad indeed that there has been no further attempt to insinuate anything like the mental health of the patient and to try to relate it to some kind of obsessional attitude arising from a custom or from religion or anything of that kind. I genuinely believe that obsessions of that kind, however caused, could never be a justification for mutilating operation of this kind, and I do not think we should have countenanced it. Therefore, I think that the sponsors of this Bill are quite right to leave it in its present form. I would say that professionally I do not believe there is any need at all for any further exceptions beyond those which your Lordships have already approved.
8.38 p.m.
Lord Hatch of Lusby: My Lords, I only wish to endorse and to re-emphasise the words of my noble friend Lady Jeger. This is a Bill which has unanimous support, not just in this House but I believe through-out the country. If the issues that have been debated in this House were put to the people of Britain, I believe there would be virtual unanimity that this is a further step towards the civilising of the practices and the law of Britain. That is the first reason why I wholeheartedly support my noble friend Lady Jeger in pleading with the Government to make it absolutely plain tonight that they are not only approving of the Bill but unreservedly putting their total weight behind it when it passes to another place, and in the form in which it has passed through this Chamber.
I particularly remember—I think it was during the first time we went through this Bill—the very strong speech made by the noble and learned Lord the Lord Chancellor, when he not only condemned the practice but expressed his belief that it was outside the law of today. This Bill can only strengthen the words which he used at that time; but I would ask the noble Lord who is to reply whether he has yet got the answer to a question which I have consistently asked during the passage of this Bill twice, as to what is the attitude of the Director of Public Prosecutions towards the cases which have been at least reported, if not proved, to the effect that this practice has been engaged in in this country in recent times.
My noble friend Lady Jeger touched on a second reason in her speech on the Question that the Bill do now pass; namely, the international effect. Those of us who have lived where female circumcision is part of the tribal customs of certain communities—and I stress just certain communities—in various parts of Africa and Asia know of the great courage which has been shown, and is being shown, by those women—and some men, too—who believe that that ancient tribal custom is uncivilised because it is cruel, and who are now trying to persuade their fellow members of these communities that it should be outlawed and should no longer be considered to be a part of tribal custom. We cannot emphasise too often or too loudly that no hint of criticism of the traditions and customs of other people is contained either in the Bill or in the speeches which have been made in support of it. But there are very brave women, and men, who, having been brought up in those customs but having seen that cruelty is an absolute evil, now recognise that this principle must take precedence over the customarv habits of their communities. I believe
218
that the Bill, and I pay my tribute to the noble Lord, Lord Kennet, for having introduced it, will be of enormous service to those men and women who are fighting against the most dangerous of all prejudices: that of tradition and custom.
As my noble friend Lady Jeger has pointed out, if anything is done by anybody in either House of this Parliament to change the spirit of the Bill—indeed, to change the letter of the Bill—as it leaves this Chamber or to prevent its passage, it will be a disservice to the cause of humanitarianism throughout the world and a betrayal of the courage that is being shown by the men and women whom I have mentioned. I hope, therefore, that when he winds up on behalf of the Government the noble Lord, Lord Glenarthur, will recognise that he is speaking not just to this Chamber, not just to this Parliament and not just to this country; his words will be heard in many parts of the world where a few men and women are fighting a very courageous and often very lonely battle against the traditions of centuries in order to bring civilisation, kindness and a destruction of cruelty to the communities of which they are members and who recognise, above all, that a community is judged by the way in which it acts towards its womenkind.
8.45 p.m.
Lord Glenarthur: My Lords, now that we have almost completed our consideration of the Bill, your Lordships will want to know, as the noble Lord, Lord Kilmarnock, suggested, what the Government's attitude is to its further progress. When I spoke on Second Reading I said that the Government supported the principle of the Bill. I can assure your Lordships that we still stand foursquare behind that principle. However, I also made it clear that we did see certain deficiencies in the Bill as it was first presented and that these would have to be put right if it were to reach the statute book.
I certainly welcome the numerous improvements which have been made during the Bill's passage through your Lordships' House. I, for one, appreciate the co-operation that I and my ministerial colleagues have had from the noble Lord, Lord Kennet, and many of your Lordships in bringing about those improvements, so it is a matter of real regret to the Government that after all the work that has been done, both in this House and elsewhere, the Bill is still, as we see it, defective in one important respect; namely, the exemption not for female circumcision, as was hinted by the noble Lord, Lord Winstanley, but for the necessary surgical operations provided for in Clause 2. It is a point that we argued at length in Committee, and I do not propose to go over all that ground again; but at this stage I should leave your Lordships in no doubt about the issues, as the Government see them.
Whatever our differences about the details of the Bill, we all speak of course with one voice in condemning the revolting practice of female circumcision, wherever it occurs, and in wishing to ensure that no one can perform it in this country. The point on which we have found ourselves at odds concerns that very small category of operations for which the need does not arise directly from the physical health of the patient. I explained at an earlier stage why, in our view, these are not sufficiently covered by the phrase "rectification of abnormality".

219
I do not propose to rehearse that argument again. It is, I accept, an argument on which I failed to convince the Committee, as it then was. And I do not, of course, for a minute question the Committee's right to take the view that it did. However, I am very much concerned about the extent to which that view may have been based upon misrepresentation and misunderstanding of our position. The impression certainly seems to have arisen that we are talking about women suffering from some sort of mental delusion which expresses itself in a desire for mutilation. But our purpose in seeking a provision for mental health grounds was not in any way to indulge any such desire. It was simply to avoid interference with surgery whose object has nothing whatever to do with mutilation, but whose object is to reduce the size of a woman's external genitalia in those cases where it is a source of real distress to her.
I very much regret the impression which has gained ground in some quarters, certainly outside your Lordships' House—I have had many letters on the matter—that the Government are trying to allow female circumcision on mental health grounds. I hope I have made it quite clear how utterly misconceived this conception is. It was hinted at in the speeches which have been made tonight, and I stress again that this concept is wholly wrong.
If, as I have argued, the definition of "necessary surgery" needs to include some provision for mental health grounds, we have to avoid creating a loophole that would allow the customary practice of female circumcision to be performed on the ground that the patient's mental health would suffer if it was not performed. This a problem which we have considered in very great depth, and we believe that the only way of preventing such a loophole is by a specific exclusion of custom or ritual as grounds for surgery. What makes female circumcision different is, I suggest, the existence of the social pressures to which I have referred to conform to the customs prevailing within certain communities. The whole purpose of the Bill is to prevent those customs from gaining a foothold in this country—a view which we all share. I cannot agree that the Bill becomes racialist simply because that implied purpose is stated explicitly.
A further flaw in the present wording of Clause 2, as amended tonight, is that the only test of whether an operation is allowed is the opinion of the registered medical practitioner that it is necessary for the reasons stated. Thus a doctor who was charged with an offence under Section 1 would simply have to state that in his opinion the operation was necessary for the patient's physical health, or the rectification of abnormality, and the case against him would fall. The court would have no power to question the grounds of his opinion. The amendment the Government moved in Committee would have required that the operation be necessary objectively for the person's physical or mental health, and not merely necessary in the doctor's opinion. The doctor could thus be required to satisfy the court that his opinion was reasonable in all the circumstances, and it would be open to the court to consider other expert medical evidence on this point.
Our view about the right way of tackling this problem is not just the view of the Government and
220
the Royal College of Obstetricians and Gynaecologists. It is also shared by the British Medical Association. I should like to quote from a letter I have received from the association in which they state,
"We agree that it would be quite wrong for any doubt to be cast over the position of women, black or white, or of any ethnic group, requiring surgery for reasons which have nothing to do with the custom or ritual practice of female circumcision".
I repeat that the Government hope that it will still be possible to introduce a form or words to which we can give our full-hearted, unequivocal support—but we have to realise that time is not exactly on the side of this Bill.
In conclusion, I would like to say something about our understanding of the law as it stands. This was referred to by the noble Baroness, Lady Jeger, and the noble Lord, Lord Hatch of Lusby. I would not want it to be thought that if Parliament fails to pass a Bill, this will leave unbridled licence for female circumcision to be performed in this country. Interpretation of the law is, of course, a matter for the courts, but our advice is that an act of this kind performed without the consent of the person on whom it was done would constitute an assault. I am advised that, if the operation was performed on a girl under 16, the courts should have no difficulty in deciding that she could not give a valid consent. However, the position where an adult woman has apparently given her consent seems rather less clear, and indeed the whole matter cannot be entirely free from doubt in the absence of a specific judicial authority. I can, however, give your Lordships the assurance that if we receive any specific allegations of female circumcision being performed, we shall not hesitate to bring them to the attention of the Director of Public Prosecutions so that he can consider whether a prosecution should be brought.
As I said in my opening remarks, the Government very much regret the differences that have arisen between those discussing this Bill on an issue on which we are so strongly united in principle. I hope very much that the Bill's remaining deficiencies can still be put right and that we shall be seeing the Bill here again in a form the Government can fully endorse.
Baroness Lockwood: My Lords, before the Minister sits down, may I put it to him that it is hardly in keeping with the spirit in which this Bill has been discussed by all sides of the House that he should wait until his final winding-up speech to make the point that he has made about the amendment passed by this House before we reached the final Third Reading. I think it would have been more helpful had the Minister put forward his view at an earlier time, when we were debating the amendment.
Perhaps I may go on to say that on this occasion, although the Government have expressed their broad support for the principle of the Bill, which no one would challenge, the Government have not been particularly helpful in trying to get this Bill through in a way that is acceptable not only to the House but also to the many organisations mentioned by my noble friend on the Front Bench and by the noble Baroness opposite. I hope that when this Bill does go to another place the views of those professional organisations, the views of the voluntary organisations, and the views of international organisations will be taken into account as well as the debate in this House.
Baroness Masham of Ilton: My Lords, perhaps I may add just a few words. Following what has been said by the noble Lord, Lord Glenarthur, I hope that where there is a will there is a way; and if the Government really want to find a way, they will do so in another place. I hope that this Bill will have a speedy passage through another place with the Government's full help and blessing.
If we were a civilised country—and I sometimes wonder whether we are, when one sees such horrors as "video nasties"—there can be no place for such mutilating torture of young girls as female circumcision. I am pleased that the National Union of Townswomen's Guilds have passed a motion unanimously,
"That the NUTG declares its total support for prohibition of female circumcision".
That is just one more to add to the list of the noble Baroness, Lady Jeger.
Nationwide, people—especially women—were shocked when they realised that this barbaric practice was taking place in this country. There is no place for it in Britain in 1984. If this Bill does not become an Act of Parliament soon, I am sure that your Lordships will have a third Bill before you before too long. I hope that the Minister will do his best to see that this Bill is in safe hands when it leaves your Lordships' House.
Lord Kilmarnock: My Lords, I have listened with the greatest interest to all that has been said by every speaker in this debate on the Bill do now pass. It seems to me that the objections which the noble Lord, Lord Glenarthur, has adduced this evening were more precise and specific than those which he advanced when moving the Government's earlier amendment at an earlier stage of the Bill, which was not carried. It therefore seems to me to be regrettable—as the noble Baroness. Lady Lockwood, implied—that the Government did not come forward and clarify their position at an earlier date. Had that been the case, we—the sponsors and the Government together—might well have been able to come forward with an amendment that would have satisfied all the interested parties to this Bill.
We have now reached the stage where we are to pass this Bill, but with those remarks I should very much like to urge upon the noble Lord that he takes account of what all speakers have said this evening. It seems to me that a position which is acceptable to all parties could be reached, and I hope that the Government will give thought to that.
In view of all the extremely hard work that has been put into this Bill by all the people associated with it, perhaps we can have a further meeting with the noble Lord to try to arrive at a final agreement on the form of words that will be acceptable to the Government and which will meet the undoubted concern expressed by all sides of the House this evening, and which is evident up and down the country, that this abominable practice must be banned.
Lord Glenarthur: My Lords, with the leave of the House, may I respond to one or two of the remarks which have been made? I am sorry that the noble Baroness, Lady Lockwood, felt that I ought to have said what I did say about a particular aspect of Clause
222
2 when I spoke to the amendment and not when I spoke on the Motion, That the Bill do now pass. I did say, when I spoke to the amendment, that the amendment, so far as it went, improved the clause—but only so far as it went—and that I would be returning to the general matter of Clause 2 later. If I have been discourteous to the House in amplifying my remarks in that particular way, then I of course apologise. It was merely that the issue involved with the amendment was a smaller one and one acceptable to the Government; rather more so than the general issue of Clause 2 to which I referred.
The noble Lord, Lord Kilmarnock, talked about the hard work that everyone has put into this Bill. I am the first to appreciate that. It has taken an immense amount of time and work to get the Bill this far. I again pay tribute to all those Members of your Lordships' House who have helped. However, I do not want the noble Lord to leave your Lordships' House with the impression that in some way the Government have been intransigent about the improvements to Clause 2 by suggesting that I have said anything different to what I said at any other stage of the Bill. That is simply not the case. I had many discussions with the noble Lord, Lord Kennet, as did my ministerial colleagues, and with other of your Lordships, both in and outside this Chamber. I and my colleagues have maintained all along that if we are to see this Bill in its proper form it will be necessary to include the sort of provision to which I referred just now and which I do not intend to repeat. It would be a pity to suggest that in some way we have now clarified an issue which we had not clarified hitherto, because that is not the case.
On Question, Bill passed, and sent to the Commons.
House adjourned at one minute past nine o'clock.

  H.M. PRISONS, HULL AND ALBANY: WORKSHOP NOISE LEVELS
  H.M. PRISONS, HULL AND ALBANY: WORKSHOP NOISE LEVELS
  SOVIET MARITIME POLICY: MONITORING
  SOVIET MARITIME POLICY: MONITORING
  HIGHER EDUCATION: STUDENT GRANTS
  HIGHER EDUCATION: STUDENT GRANTS
  YOUTH SERVICE IN LONDON: RATE-CAPPING PROPOSALS
  YOUTH SERVICE IN LONDON: RATE-CAPPING PROPOSALS
  WORLD CULTURAL AND NATURAL HERITAGE: UNESCO CONVENTION
  WORLD CULTURAL AND NATURAL HERITAGE: UNESCO CONVENTION
  WILDLIFE AND COUNTRYSIDE ACT: COST OF CLAIMS
  WILDLIFE AND COUNTRYSIDE ACT: COST OF CLAIMS
  AIRBUS: FINANCING
  AIRBUS: FINANCING