Sitting of 16 November 1984

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

  Friendly Societies Bill
  Order for Second Reading read.
  9.35 am
  The Economic Secretary to the Treasury (Mr. Ian Stewart): I beg to move, That the Bill be now read a Second time.
  The Government were advised in May this year that there were significant doubts about whether a number of friendly society contracts were enforceable at law. At the end of May 1 therefore announced that we would introduce legislation to protect the position of those who had entered into those contracts in good faith. The legislation would also prevent such doubts arising on future contracts, broadly by restoring the law to what it was previously understood to be.
  The legal doubts concern the enforceability of some 300,000 life insurance contracts taken out before 1 June 1984 with certain recently formed friendly societies. The main problem was that the brochures advertising the contracts purported to confer benefits that were almost certainly greater than the statutory limits on tax-exempt contracts, and different in their nature from the types of contract admitted by the rules of the societies concerned. Doubts have also arisen about the way in which the limits should be applied in the case of assurance contracts in which the benefit was linked to investments, and about whether the surrender value of an annuity should be counted against the limit on gross sums. Those doubts apply to friendly societies generally and to the limits on taxable as well as tax-exempt business.
  I shall refer to the material clauses of the Bill. Clause 1 deals with the particular problem that arose in respect of 11 societies registered since 1966. It removes doubts about enforceability of past contracts issued by those societies on account of additional terms being imported into the contracts by the way in which the contracts were advertised. The clause enables such additional terms to be disregarded in determining compliance with the statutory limits on friendly societies' tax-exempt life insurance business and in determining the validity of any contract to which the clause applies.
  Clause 2 deals with a lesser problem identified for societies generally and redefines the provisions for the future so that the same problems will not recur. It does so by modifying the operation of the limits on an individual's entitlement to tax-exempt benefits from registered friendly societies. Increases in the value of a contract due to
  894
  investment linking are to be disregarded for the purpose of the limits, in the same way as declared bonuses on with-profit policies are already disregarded. It ties the limits to the sums assured, thus avoiding the need to take account of surrender values. It applies those modifications with retrospective effect, thus removing doubts about existing contracts on both those counts. By abolishing the limits on taxable business, clause 2 also removes doubts about possible breaches of those limits in the past on similar grounds.
  Most of the provisions that I announced in May will be in next year's Finance Bill. However, it was important to resolve the legal position without delay. The Government were therefore anxious to introduce the legislation as soon as possible in the Session. The Bill includes only those provisions that could have no place in a Finance Bill, primarily the validation of the existing contracts. The Bill is mainly technical. It is entirely helpful to friendly societies and their members. I therefore commend it to the House.
  9.38 am
  Dr. Oonagh McDonald: The Bill applies to friendly societies, 4,000 of which were in existence long before 1966. Most are very small, set up during the past 100 years, and some have a longer history. They were working-class, self-help organisations. About 50 undertake taxable business—a very small proportion of that total—and may have about 2 million members between them. Eleven post-1966 societies were set up to undertake a different sort of business. When the limits on tax exempt business were increased in the Finance Act 1980, some friendly societies regarded it as an encouragement to do such business—societies were set up specifically to deal with such insurance policies. When the Government decided to change those limits in this year's Finance Bill, the activities of friendly societies attracted the attention of lawyers. They examined promotional literature and the policies that societies were issuing, and doubts about the validity of some policies arose. That is bound to happen when lawyers closely examine one's activities. No doubt they found uncertainties partly because of the rules of friendly societies.
  As the Minister said, the Bill is welcomed by the friendly societies. I took the trouble to contact the National Conference of Friendly Societies to ensure that it was welcomed and that no further questions needed to be raised. The Bill will indeed settle uncertainty and doubt about some policies. A few of the doubts have been dealt with neatly as clause 1 simply excludes promotional literature from counting as part of the contract. Perhaps the same principle could be applied elsewhere.
  I have only one point to make—I wish that the Government were prepared to deal with other issues concerning people's money and savings to exclude doubt and uncertainty and to remove the possibility of people losing their savings. I think, for example, of licensed dealers who are now allowed to sell shares over the counter. Shareholders have found that their shares have disappeared and that they have no recompense. The Government's energy and industry in bringing forward the Bill is to be commended. I only wish that they showed the same energy and industry in regard to dealing with abuse and uncertainty in money dealings that affect small investors and savers.
  9.42 am
  Mr. Peter Griffiths: I support what my hon. Friend the Minister and the hon. Member for Thurrock (Dr. McDonald) have said and I have no criticisms of the Bill. It is clear that political battle is not about to be joined. My hon. Friend said that we shall return to this matter in the next Finance Bill. Although the Bill, which deals with only a small part of friendly societies' activities, is to be commended, there is a case for my hon. Friend to consider the traditional role of friendly societies, especially in cities where there is a long tradition of a combination of skill and working people. That applies to Portsmouth, although it is in the bustling and relatively prosperous south, as much as to northern cities.
  The pre-1966 societies have never engaged in the type of activities that the Bill covers. They have never regarded themselves as being in competition with insurance companies or in the provision of mortgages. They have always emphasised their philanthropic role and their aim of mutual self-help.
  There are 2 million members of the pre-1966 societies—including 35 of the main societies—and none of them has ever engaged in activities that could be regarded as damaging to the Revenue. They have not sought tax avoidance or to skate on the edge of the law. Will my hon. Friend consider amending friendly societies legislation to ensure that pre-1966 societies carry on their traditional philanthropic role while the newer ones are regarded as what they are—insurance companies? They are not true friendly societies. I do not wish to labour the point but it is important that, when drawing up legislation such as this—which I am happy to support — we recognise the important social purpose that has been fulfilled for many
  896
  decades by the traditional friendly societies. We should do nothing to weaken their role, nor should we tar them with the same brush as others whose purpose and activities are quite different.
  9.46 am
  Mr. Ian Stewart: With the leave of the House, I should like to answer some of the questions that have been asked.
  With regard to licensed dealers and securities, I hope that the hon. Member for Thurrock (Dr. McDonald) will wait for my right hon. Friend the Secretary of State for Trade and Industry's White Paper on financial services which will cover many issues relating to investor protection. I am grateful for her welcome for the Bill. The same is true of my hon. Friend the Member for Portsmouth, North (Mr. Griffiths). I shall consider what he said. I should like to add my own words of approval and support for the traditional friendly societies. The boundary between the pre-1966 friendly societies and later ones is not quite as clear cut as he suggested. Some of the Bill's provisions will also assist traditional friendly societies because of doubts about the application of the limits on investment linking — a problem met by all societies.
  What I said about the Finance Bill 1985 was mentioned in my statement of 31 May. My comments are consequential on decisions in the Bill. They go no wider. I listened to my hon. Friend's comments with interest and shall consider what he said.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Donald Thompson.]
  Committee upon Monday 19 November.

  Mineral Workings Bill
  Order for Second Reading read.
  9.48 am
  The Parliamentary Under-Secretary of State for the Environment (Mr. Neil Macfarlane): I beg to move, That the Bill be now read a Second time.
  The Bill concerns two issues relating to former mineral workings. Its main purpose — and all but one of its clauses relate to this — is to wind up the ironstone restoration fund now that there is so little remaining ironstone working in England. The second purpose, with which clause 7 deals, enables local authorities to get on to land quickly to take remedial action when they have reason to believe that there is a risk of subsidence because of former underground mineral workings.
  The problem with the ironstone restoration fund is that, although its income has dried up with the marked reduction in ironstone working, it is still required to finance agricultural aftercare and afforestation. After 30 years of useful life in which it has almost, but not quite, completed its task, the fund is able to meet its remaining financial obligations only with the help of substantial voluntary assistance from the British Steel Corporation.
  The BSC is the only major operator still extracting ironstone in the United Kingdom, and for some years it has been the only operator contributing to the fund. It is already bearing the fund's financial burdens on an informal basis. The time has come to wind up the fund, to transfer such money as will be left to the BSC and to provide for the necessary future aftercare and afforestation.
  The fund was set up under the Mineral Workings Act 1951 in response to increasing public anxiety about the dereliction of land in the east midlands ironstone field. The working of ironstone by opencast methods is not a 20th-century phenomenon, but has been going on for centuries. However, the dereliction was new. Until about 1914 ironstone working was confined mainly to the shallower seams of ore, which were cheap and easy to restore by back-filling as part of the extraction process. It was normal to restore the land as extraction progressed, and restoration was usually required by the terms of the operator's lease from the ironstone royalty owner. The pressure for production to meet the demands of the first world war changed that. Operators were driven to work deeper seams, restoration became less easy and more expensive and, inevitably, an increasing quantity of worked ironstone was left unrestored.
  By 1950 about 2,500 acres of land were unrestored in Northamptonshire alone. The then Minister for Local Government and Planning, the late Mr. Hugh Dalton, described areas he visited as resembling
  "deserts of the moon … horrible to behold … and bound to have the most depressing effect upon the morale of all those living near them."
  The then Government were faced with a serious problem. Their solution was to designate those areas that they considered most vulnerable as the "ironstone district" and to set up the ironstone restoration fund to fulfil three main functions: to meet the full cost of reclaiming the land; to facilitate the full restoration of future workings; and to assist owners and occupiers of restored land to return it to beneficial after-use for agriculture and forestry. Today the fund is administered by my right hon. Friend the Secretary of State for the Environment.
  898
  The system of finance worked quite well during the years in which the British steel industry was buoyant, but over the years technical and economic developments have reduced the demand for locally dug ore. Contributions to the fund decreased as the rate of extraction fell. As a result the fund is teetering on the brink of bankruptcy. This year the generosity of BSC has come to the fore. It has voluntarily undertaken to pay nearly £400,000 over and above its required operator's levy to keep the fund afloat until 31 March 1985.
  Without that contribution from the BSC the fund would be nearly £105,000 in the red. Expenditure in the region of £290,000 is estimated and the Exchequer would have to supplement the regular BSC contributions by a further £600,000 to keep the fund afloat until the end of the current PESC period, which is 31 March 1987.
  The fund has done a good job, but it is now at the end of its useful life. The circumstances which gave it birth have been overtaken by events. The small, environmentally irresponsible operators have disappeared from the ironstone scene and have been replaced by a responsible nationalised industry. The pre-1950 dereliction has been restored, and most of the land worked since that date has been repaired and returned to beneficial after-use.
  Some land is still being worked for the steel industry, but that is all either within the ownership of the BSC or under its control. All that remains is to complete the aftercare work on a handful of the most recently restored sites. I shall explain how we propose to deal with those in a moment. In short, we believe that the time has come to give the fund a decent burial, which is what the ironstone provisions of the Bill set out to do.
  Clauses 1 to 3 and 6 contain provisions to wind up the fund, to transfer its assets to the BSC and to make general house-keeping arrangements to tidy up its final account.
  The main meat is contained in clauses 4 and 5, which make arrangements in recognition of the fact that some owners and occupiers, whose land has already been restored with financial help from the fund, still have legitimate expectations from it in respect of the agricultural aftercare or afforestation of their land. I fear that at first sight those arrangements may appear a little arcane. That is because they are essentially transitional provisions and must therefore reflect the rather complicated aftercare arrangements contained in the 1951 Act.
  Clause 4 is a transitional provision to honour arrangements which have been made to return land to agricultural use. Under section 20 of the 1951 Act, the Minister of Agriculture, Fisheries and Food may enter into arrangements with the owners or occupiers of land which has received restoration payments from the fund to make grants for work to bring it
  "to a good state of cultivation and fertility."
  His expenses in so doing may be defrayed out of the fund.
  Most of the section 20 arrangements have already been completed but, as I mentioned earlier, there are still a handful of sites£about 16£on which some aftercare work has still to be done. The purpose of clause 4 is to enable my right hon. Friend the Minister of Agriculture, Fisheries and Food to continue to honour those agreements for a transitional period and for his expenses to be met by the BSC.
  All of the arrangements must be made before section 20 is repealed on 1 April 1985. Where they relate to the

  899
  aftercare of land restored before 1 January 1984, the arrangements may persist until completion or until 31 March 1990, whichever is the earlier.
  The cut-off date has been set at the end of March 1990 because that is five years from the introduction of the transitional arrangements, and because Parliament accepted that five years was a reasonable period for aftercare when it passed section 5 of the Minerals Act 1981. In fact, the reality of our arrangements is a little more generous because land restored by the end of 1983 could have the benefit of six and a quarter years' aftercare, and the statutory cut-off date will not apply to the one or two sites restored after 1983. The arrangements for those may persist for whatever period is specified in the formal agreement.
  Clause 5 makes similar transitional arrangements for land which has been restored with the assistance of payments from the fund and is being returned to forestry. The afforestation arrangements are rather different from those made for agricultural aftercare but I am afraid just as arcane because of the 1951 provisions which they reflect.
  Under section 25(1) of the 1951 Act, the forestry commissioners may pay a special grant at an agreed rate to assist with the return of worked ironstone land within the ironstone district to a condition suitable for afforestation. The grant does not form part of the normal forestry grant. The commissioners' expenses on that special grant are defrayed from the ironstone restoration fund. The provisions of clause 5 will oblige the BSC to reimburse the commissioners' expenses on that special grant until 31 March 1990, provided that it has been consulted about the rate of the grant.
  It is important to recognise that the clause 5 arrangements relate only to the special grant which ironstone landowners and occupiers receive from the forestry commissioners. Their normal forestry grant under section 1 of the Forestry Act 1978 will in no way be disturbed by the transitional provisions of clause 5.
  Those then are the ironstone provisions. They have been worked out in full consultation between officials of my Department, the BSC and the Ironstone Royalty Owners Association, which represents the interested landowners. Other Government Departments with an interest and local authorities in the ironstone district have also been consulted. In short, what is proposed is little more than a sensible regularisation of the informal position which, in essence, already exists. But the provisions are framed around the expectation that the fund can be wound up and the new arrangements put in its place in time for the BSC to assume its new responsibilities at the beginning of the next financial year.
  The purpose of clause 7 is to give local authorities a power to enter land to survey, monitor or carry out reclamation works where subsidence has occurred or is likely to occur as a result of former underground mineral workings. Any proposal to introduce a new power to enter private land is a matter of obvious public importance and natural concern, and I should like to take time to explain to the House the background to it and why the Government consider the power is needed.
  The widespread existence of old limestone workings in parts of the west midlands has been known for many years, but prior to 1978 it was generally thought that, if over time
  900
  any underground collapse were to occur, it would have little effect on the surface. However, in that year subsidence over deep workings in Sandwell caused substantial damage to industrial buildings, serious enough to cause considerable concern about where else in the area other subsidence from old workings might be threatened. Accordingly, my Department along with the borough councils of Dudley, Sandwell and Walsall and the West Midlands county council commissioned Ove Arup and Partners to carry out a comprehensive study to determine the nature and scale of the problem.
  The report was published in July last year. It identified a number of areas of limestone mining which were not suspected previously. It also highlighted the considerable degree of uncertainty regarding the precise extent and condition of many of the workings. I visited several of the worst affected sites and saw at first hand the problems which the authorities and the people of the region must face. I also met representatives of the financial institutions.
  An action programme has been set up under the derelict land reclamation scheme with the aim of resolving the problem, and we have appointed an advisory panel, under the chairmanship of Sir Edward Parkes, to assist in this. The local authorities in the area are developing a programme of, remedial work that will continue for some years. One of the first things identified as an essential need in the work was the importance of being able to gain access to sites that were found to be at risk, and to take prompt action. Many old mine workings lie below land that is privately owned, sometimes in multiple ownership, and I have no doubt that in most cases the consent of owners and occupiers to enter their land, to survey it and to carry out the remedial work will be freely given. It is obviously in their interests to do so.
  However, there will almost certainly be cases—we have evidence of this already—where, through natural reluctance, or because of their absence, the consent of owners or occupiers will not be forthcoming within the necessary time. Delay would put not only their land, but their neighbours' land, at even greater risk. That is why the urgent action that may be required from time to time needs the backing of the new power. As the House will have noticed, the new application of the power is not confined to the west midlands. It will be available, and wisely used, where similar problems may arise. We are already aware of many other areas where there are such workings.
  Mr. Peter Griffiths: My hon. Friend says that the power will have a wider geographical application than just the west midlands. Will he make it clear that the Bill affects only those areas listed in schedule 1 and that, despite what clause 7(2) says about,
  "underground mining operations other than for coal",
  he is talking only about previous ironstone operations, not about the underground mine workings?
  Mr. Macfarlane: If my hon. Friend studies my earlier words, he will discover that clause 7 deals with a completely different problem. I am confining my remarks mostly to the problems of the west midlands, but they could occur elsewhere. I shall enlarge upon this matter in a few moments.
  The context in which the new powers will be exercised is set out in subsections (1) to (4) of the clause. Hon. Members will note the strictly limited purposes described

  901
  in subsection (3) for which the power of entry may be exercised. Subsection (2) defines "relevant operations" by reference to section 89(2) of the 1949 Act. For the immediate convenience of the House, I might mention that these are defined simply as underground mining operations, except coal mining, which have ceased to be carried out.
  Subsections (5) to (9) provide fairly elaborate safeguards for the occupier of land to which entry is wanted. Subsection (10) provides a penalty for wilful obstruction. Subsections (11) and (12) contain the important provisions for compensation for loss, damage or disturbance. Subsection (13) is a standard provision for arbitration in case of disputes over compensation.
  In speaking to the clause on Second Reading, I should bring two points to the attention of the House. Subsection (5) requires seven days' notice of intended entry to be given to an occupier. The occupier was chosen as being the man on the spot with whom a local authority could deal quickly, whereas, highly desirable though it may be, an owner who is not also the occupier may be difficult to trace, with risk of unwanted delay.
  We now consider it essential, to safeguard the rights of owners, that they, too, should be notified. One way of overcoming the problem of the difficulty in tracing owners is to have recourse to the reserve power in subsection (7) for a justice of the peace to authorise entry by warrant if access to the owner cannot easily be obtained. Accordingly, I am happy to tell the House that I shall be tabling an amendment in Committee to secure the requirement that notice of intended entry must be given to the owner as well as to the occupier, with recourse to a justice of the peace in case of serious difficulty in tracing the owner or obtaining his consent.
  The second point concerns subsection (3), which authorises entry for the purposes of survey or carrying out remedial works. A local authority's power to carry out remedial works lies in the general derelict land reclamation power of section 89(2) of the National Parks and Access to the Countryside Act 1949. Subsection (3), however, does not permit works to be carried out under subsection (2) except with the consent of all persons interested in the land. So that, while the power to enter land without consent, if necessary, to survey it subsists in subsection (3)(b) and (c) of our clause, the same is not the case, as the text stands, in respect of the power to carry out remedial works without consent. The power of entry on to the land without consent for the purpose of doing works would not be of any practical use if the works could not be carried out because someone with an interest in the land had not given his consent.
  Therefore, to make the provisions of the clause fully effective in respect of entry to carry out works, I am proposing to table an amendment to the Bill to override that constraint in urgent cases. I should emphasise that the intention would be to impose strict conditions on the exercise of the power to safeguard the position of owners.
  10.5 am
  Mr. John McWilliam: I apologise to the Minister and to the House for the absence of my hon. Friend the Member for South Shields (Dr. Clark), who should have been here today. He was abroad yesterday on parliamentary business, and I am afraid that he is one of the many thousands of people who are waiting to land at
  902
  Heathrow airport this morning. His aeroplane is circling somewhere above us, and I am sure his thoughts are with us.
  The Opposition take no exception to the Bill as it stands. We shall wish to make a few detailed points in Committee, but by and large we welcome the Bill. I thank the Minister for the clear way in which he explained it to the House.
  10.6 am
  Mr. Roger Freeman: The Bill will have important consequences for my constituency of Kettering in Northamptonshire, and I am grateful for the opportunity to speak during the Second Reading debate. To set the record straight, I assure my hon. Friend the Minister that my constituency no longer resembles the deserts of the moon. My hon. Friend referred to Dr. Hugh Dalton, whose initiative many years ago was important in setting up the ironstone restoration fund. It is appropriate, when one considers the subject of today's debate, that in some quarters of the Labour party he was called the iron Chancellor.
  Ironstone working has now stopped in Northamptonshire. It reached its peak in about 1970 when iron ore was needed for the Corby steel works. With the sad closure of those works in 1980, no more iron ore was needed. Although working has ended, the affected landowners and occupiers have a continuing interest in the ironstone restoration fund and the provisions of the Bill for changing the finances for restoration work. It is important for the House to appreciate that there are two sorts of restoration for old ironstone workings. The first is where the old quarries are filled in; as my hon. Friend told the House, that work has largely finished in Northamptonshire. The second aspect of restoration is the aftercare, when the land is brought back into agricultural and forestry use. I am primarily concerned with the aftercare restoration.
  Under the Mineral Workings Acts of 1951 and 1971, a tripartite system was set up to administer the ironstone restoration fund. Each of the three parties—the Government, the steel companies and the quarry owners—contributed to a fund to pay for the restoration of the quarries and the additional measures necessary to bring the land back into agricultural and forestry use.
  I speak in part on behalf of the Ironstone Royalty Owners Association, which has a direct interest in the winding up of the fund proposed by the Bill. I should say at the outset that I broadly welcome the Bill and commend it to the House. The points that worry me can be dealt with in Committee, and I shall allude to them only briefly now. Before doing so, may I compliment my hon. Friend the Minister and his officials on the fair and open way in which they discussed with the landowners possible changes to the fund. It was much appreciated.
  I also congratulate the British Steel Corporation on the expeditious and efficient way in which it restored almost 1,900 acres of open gullets in the Kettering and Corby areas during the past three years. I had practical experience last week of examining some of the restoration work done by the British Steel Corporation in the middle of my constituency, and that has been completed in an efficient manner. As this is only a Second Reading debate, I shall make only a few comments. In Committee, when we give the Bill further consideration, I shall be able to debate these points in more detail.

  903
  It is important to enshrine in the Bill the essential principle that any variation to arrangements affecting agricultural land agreed between my right hon. Friend the Minister of Agriculture, Fisheries and Food and all the interested parties before 1 April 1985—that date is acceptable to the landowners—shall be made only with the written approval of all the interested parties. As my hon. Friend the Minister knows, the Bill provides only that written approval should be obtained from the BSC. Clause 4(2) should include the need for the Minister to obtain also the written approval of the landowners and occupiers. It is important to retain the tripartite system on which the original fund was based.
  The Bill is based on limiting the life of arrangements for aftercare of restored land where the basic work—filling in the holes—was completed by 1 January 1984, to a cut-off date of 1 April 1990. I can understand the desire of the Government and BSC to have a definite limitation to the period of financial commitment. That is logical, but I stress that subsidence after restoration work can occur beyond the five years from the completion of that work. What happens if there is subsidence after 1990?
  I am sure that the Government will agree that such subsidence may occur. It is undeniable that, for geological reasons, it may do so. The Government's arguments may be that this subsidence may be minor and hence not many landowners will be affected, and that, in any case, if they are affected by subsidence after 1990, they can resort to the land drainage grant system. However, if the drainage grant system disappears, the landowners will be left without any financial support or recourse. I am asking only for an assurance by the Minister—not for any wholesale change in the Bill—and some comforting words that it is not intended to leave the landowners particularly vulnerable after 1990 should they suffer subsidence relating to the original restoration work.
  One unknown factor that has not yet been encountered is the consequence of large-scale restoration work completed in a short time. We do not have a precedent, to establish whether and on what scale subsidence may occur.
  I am also concerned about the procedure for determining forestry grants. The Bill proposes that the forestry commissioners shall decide on the rate of grants after consultation with the BSC, which ultimately will have to bear the cost. I am referring here to clause 5. I am unhappy that there is no provision in clause 5(1) for an annual review of such grants, which is surely both equitable and practicable, and is also the practice in present arrangements.
  I am also concerned that there is no provision for the Forestry Commission to consult representatives of the landowners as defined in clause 4(1) of the Mineral Workings Act 1971. Is it not reasonable to ask that the Government should consult not only the ultimate payers of the grant — BSC — but also the recipients? The recipients of the grant have a legitimate right to be consulted as well.
  I support the Bill, but I hope that the Minister will give us at least an assurance that he will review my points before we discuss them in detail in Committee. At that stage I hope not only to bring up these points but several
  904
  other detailed points raised by the Northamptonshire county council, which has been in recent communication with me.
  10.15 am
  Mr. Peter Griffiths: I had not intended to intervene, because I had no reason for doing so other than to give my support to the proposals for restoration in areas where there has been ironstone working, but my hon. Friend the Minister replied very sharply to what was a modest request for information, and one wonders why he should respond in quite such a manner if the answer to the question is not as I might have feared.
  I shall confine my comments to clause 7. It is reasonable on Second Reading to ask just what is the extent of the Bill's operations and whether, within the confines of what is intended to be a fairly narrow measure for restoration in carefully defined geographical areas, there is a power which may be used by local authorities in other contexts to examine areas which have been used for the working of ironstone.
  Clause 7 applies where a local authority has been given certain powers
  "for the purpose of reclaiming or improving land"—
  in which
  "relevant operations have been … carried out".
  In subsection (2) "relevant operations" are defined, not as limestone workings, but as
  "underground mining operations other than for coal."
  That is a wide definition. If the geographical limitations are not specifically those set out in schedule 1, this may have enormously wide ramifications and would be an extension of the powers which local authorities already have to enter land. If that is intended, it should be spelt out clearly on Second Reading.
  I press the point about geographical areas because, if I do not misquote my hon. Friend the Minister, both in his original comments and in his response to me he said that the clause would have a much wider operation than merely in the west midlands. Would it not be simple for my hon. Friend, in replying to the debate, and in response to a direct question, to say that it will apply to those areas listed in schedule 1? We shall then all know where we are, and those of us who have an interest in the powers of local authorities other than in the restoration of ironstone workings will not have our fears raised.
  It is desirable, before we vote on Second Reading, to know that it is intended that the Bill will apply only to the geographical areas delineated in schedule 1, and that in so far as it applies to mining operations other than those for the mining of limestone it will be limited to such mining operations within those geographical areas.
  10.19 am
  Mr. Macfarlane: I thank the hon. Member for Blaydon (Mr. McWilliam) for taking the place of his hon. Friend the Member for South Shields (Dr. Clark), whom we hope will have a successful landing and will be returned to the House as quickly as possible. I know that the hon. Gentleman is most diligent. I understand the circumstances of his absence and I look forward to his participation in Committee.
  I urge my hon. Friend the Member for Portsmouth, North (Mr. Griffiths) to study what I said earlier. All the assurances and guarantees that he and I want are contained

  905
  in the Bill. I have hinted that I shall have to draft amendments for Committee to ensure that those provisions are honoured.
  The new application of the power is not confined to the west midlands. There could be other problems elsewhere. My hon. Friend the Member for Kettering (Mr. Freeman) asked what would happen if there were subsidence after 1990. There may be a longer-term problem, which the Government and local authorities will have to work together to overcome.
  The current problem has been prompted by difficulties in the west midlands and no one should underestimate them. We have a responsibility to ensure that if such problems arise elsewhere we have the necessary powers and safeguards available to us. That is why I shall be tabling amendments.
  Most provisions of the Bill apply only in the ironstone district, but clause 7 applies to the whole of England and Wales. I am convinced that we need the powers in that clause to ensure that problems do not arise again.
  This is essentially a two-purpose Bill. The first and essential purpose is to wind up the ironstone restoration fund, and the second purpose is to empower local authorities to enter land for the purpose of surveying, monitoring and carrying out remedial work when they have reason to believe that there is a risk of serious subsidence because of instability caused by former underground mineral workings. The scene could be wider than the west midlands and we must be vigilant.
  I am grateful for the support of my hon. Friend the Member for Kettering. We are not poles apart on many of the points that he raised and I shall consider some of his suggestions. There is a system, involving my right hon. Friend the Secretary of State and my right hon. Friend the Minister of Agriculture, Fisheries and Food, to ensure that grants can be made.
  As for the tripartite arrangement on notification and discussion, I am the most malleable of Ministers on a Friday morning and I should like to consider what my hon. Friend said and come back to him in due course.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

  MINERAL WORKINGS [MONEY]
  Queen's Recommendation having been signified—
  Resolved,
  That, for the purposes of any Act resulting from the Mineral Workings Bill, it is expedient to authorise the payment out of money provided by Parliament of—

  (1) any expenses of the Secretary of State incurred in paying sums to the British Steel Corporation in respect of ironstone extracted by operators in the financial year ending on 31st March 1985;

  (2) any expenses of the Minister of Agriculture, Fisheries and Food incurred (whether in the form of grant or otherwise) under arrangements to bring worked ironstone land to a good state of cultivation and fertility.—[Mr. Donald Thompson.]

  WAYS AND MEANS

    MINERAL WORKINGS
    Resolved,
    That any Act resulting from the Mineral Workings Bill may—

    (a) require the British Steel Corporation to pay to the Minister of Agriculture, Fisheries and Food sums equal to expenses incurred by him (whether in the form of grant or otherwise) under arrangements to bring worked ironstone land to a good state of cultivation and fertility, and

    (b) provide for the payment of those sums into the Consolidated Fund.—[Mr. Donald Thompson.]

    SOCIAL SERVICES
    Ordered,
    That Mr. David Crouch be discharged from the Social Services Committee and Mr. Steve Norris be added. —[Mr. Fox, on behalf of the Committee of Selection.]

    Sheltered Accommodation
    Motion made, and Question proposed, That this House do now adjourn.—[Mr. Donald Thompson.]
    10.23 am
    Mr. Neil Thorne: When I applied for this debate, I knew of one or two cases of constituents who were aggrieved, but my researches in the past few days have disclosed that the unhappiness is much more widespread.
    As most people know, residence in hospital under the NHS is provided free and no charge is made for accommodation or food, although those on pensions receive a reduced rate after a period of time. However, those who are well enough to leave hospital, but not well enough to live alone, are provided for by the state in social services residential accommodation administered by the local authority.
    Local authorities provide such accommodation for elderly people and others under part III of the National Assistance Act 1948. Under section 22 of the Act, local authorities are required to fix a standard charge for their accommodation, the idea being that it should be the economic cost of providing that accommodation. If the resident cannot afford to pay the full charge, local authorities are required to assess his or her ability to pay and to charge accordingly.
    However, the charge must not fall below a prescribed minimum rate—currently £27·25 per week, which will rise to £28·85 on 26 November. That amount is always equal to the standard rate of retirement pension, less a specified sum for personal requirements.
    In assessing someone's ability to pay, the local authority is required by section 22(5) of the 1948 Act, as amended, to give effect to part III of schedule 1 to the Supplementary Benefits Act 1976, which is used in assessing eligibility for supplementary benefit. In fact, for supplementary benefit purposes, that has been replaced by new provisions in the Social Security Act 1980, but the earlier provisions have been saved for the purposes of charging for accommodation.
    Paragraph 17 of schedule 1 to the 1980 Act provides:
    "In taking account of the value to any person of an interest in the dwelling in which he resides, any sum which might be obtained by him by selling that interest, or borrowing money upon the security of that interest, shall be disregarded."
    Under paragraph 20 of the schedule, £1,200 of capital is disregarded. Above that, a weekly income of 25p for each complete £50 is assumed. That assumes that an interest rate of 26 per cent. after tax—about 35 per cent. before tax — can be obtained. I cannot imagine where one could obtain such a rate of interest from a reliable source.
    The problem is deciding when someone does not, in practice, reside in a house any longer. In 1978 the DHSS published a memorandum of guidance "Residential Homes Under Part III of the National Assistance Act 1948: Charging and Assessment Procedures", which is still current guidance. It says in paragraph 17:
    "It is for local authorities to decide in the light of the circumstances of each case whether a person provided with residential accommodation has effectively given up residence in a dwelling in which he retains an interest and accordingly whether—and at what stage—the value of his interest in it should cease to be disregarded under paragraph 17 of Schedule 1 to the Supplementary Benefits Act 1976."
    The memorandum goes on to say that once a property ceases to be considered the place in which the resident of
    908
    the home resides, the value of his interest in the dwelling should be treated as capital. Normally, the only exception would be if a spouse or a child under 16 continued to live in the house. However, the memorandum says in paragraph 20:
    "Local authorities have no power to compel a resident to sell his property so as to pay the assessed charge out of available resources. When a resident declines to sell, however, it is reasonable for the authority to suggest that a charge be placed on the property that would enable them to recover the accrued balance of the charges, including any interest at an agreed rate, when the property is finally sold (possibly after the resident's death). Residents should be advised or assisted to consult a solicitor about this procedure."
    That means that local authorities can allow unpaid charges to accumulate and the debt to be recovered eventually from the estate.
    Even then, a DHSS background note "Assessment of Ability to Pay: Capital Value of a Former Dwelling", issued in January 1984, says:
    "In general, it is not the practice of authorities to enforce any outstanding debt against the personal representatives of the deceased when this would result in hardship through the sale of the property."
    Relatives other than spouses or parents are not liable to maintain someone living in residential accommodation, although they may make a contribution and, in circumstances where the local authority is intending to recover the debt in due course from the estate of the resident, to do so would reduce the size of that debt.
    The January 1984 background note points out that there is
    "no compulsion on an authority to take into account the value of a former dwelling; in addition to the circumstances in which they should not do so (e.g. because of a resident's liability to maintain a spouse (or a child) they have discretion to ignore or discount such capital assets."
    During the Standing Committee debate on the Health and Social Services and Social Security Adjudications Bill, my right hon. and learned Friend the Minister for Health explained the circumstances in which that discretion should be used as follows:
    "People in residential accommodation on a permanent basis can normally be assumed to have given up residence in their former dwellings. The value of any interest such a person has in that house will normally be treated as part of his capital resources. But there is no compulsion on an authority to take into account the value of the house. In some circumstances an authority definitely should not do so, such as where the house is still being lived in by a spouse or a child. We are giving discretion to ignore or discount such capital assets in such cases. The position of a husband, wife or a dependent child is obvious, but there is another case where the Government believe that it would be entirely reasonable for an authority to exercise discretion. That is where a principal supporter or a carer continues to live in the house. Let me give a hypothetical case. An adult child, or perhaps a friend who was in no way related to the elderly or disabled person, could have spent many years living in the home and looking after the elderly person. It would be wrong if the elderly person went into part III accommodation and the interest of that carer to be disregarded and the local authority to take the value of the dwelling into account when assessing charges so that a sale is forced.
    It is not difficult to envisage circumstances in which that discretion should be used. Normal residence and direct support of the elderly person can easily be checked. Furthermore, the elderly person could normally say whether he regarded the house as the only home of the person who had cared for him and whether he assumed that 'the carer' would be the beneficiary on his death.
    When we make the new assessment regulations on which we are about to consult, we firmly intend to make provision for the continued exercise of local government discretion and to indicate that relevant circumstances should be taken into account. We believe that the circumstances such as I have described should

    909
    be taken into account by local authorities and we shall seek to cover that in the regulations." — [Official Report, Standing Committee B, 19 April 1983; c. 574.]
    The January 1984 background note says that it would be difficult to codify the circumstances in which the value of the home should be ignored without widening its scope to cover the home in all circumstances
    "hence the present discretionary nature of the provision."
    It therefore appears that, although the local authority can take account of the value of the interest of a home resident in a house, it is not obliged in all circumstances to do so. If it takes it into account it cannot compel the sale of the property, and it can agree that the debt should mount up to be paid eventually out of the estate of the home resident. In January 1984 the DHSS issued a consultative paper on charges for residental accommodation that is provided by local authorities under part III of the National Assistance Act 1948. The document says that it is proposed that
    "where a local authority judges it appropriate, the value of a former dwelling or of other property should be taken into account."
    It goes on to discuss circumstances in which the value of the home should be disregarded. It says:
    "It is proposed also that the regulations should specify the circumstances in which the value of the family home must be disregarded and when a local authority has discretion to include its value in a charging assessment. Normally people who are in residential accommodation on a permanent basis can be assumed to have given up residence in their former dwelling and the value of any interest that person has in the property will be treated as part of his capital resources. However, the capital value of a resident's former home will be disregarded where a spouse, or a child under 16 years of age, continues to live there as his normal place of residence. For this purpose, it is proposed that the regulations should treat on the same basis as spouses all long-standing relationships in the same residence—irrespective of the sex of the partners and the nature of the partnership. The value of the property should he disregarded also where it has been and remains the permanent residence of a principal supporter. The latter, in addition to providing care, may also have been the financial mainstay of the household."
    No decisions have yet been announced following the consultation period and the DHSS has not announced any date for the commencement for the operation of that system.
    There is no doubt that my right hon. and learned Friend the Minister was right to say what he said in Committee. There is no doubt, either, that the present situation is causing great upset and misery to many elderly people who are not able to take care of themselves. Admittedly the regulations make provision for local authorities to have a solicitor consulted on behalf of the person concerned, but, of course, that is not always easy, particularly where the person taken into care is senile and cannot look after himself. Therefore, several issues need to be carefully considered, and the Government must pay special regard to them.
    The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): I am sorry to interrupt my hon. Friend, as I know he is anxious to get on with his speech, but will he accept from me, on behalf of my right hon. and learned Friend the Minister of State, that we are very concerned about the point that he has made? We are particularly concerned that elderly people should not be upset or worried by the misapprehensions that my hon. Friend has described. We shall certainly bear everything that he has said very much in mind.
    Mr. Thorne: I am grateful to my hon. Friend for saying that. Perhaps I can do no better than illustrate my case by a recent example that was brought to my attention. It involves two elderly sisters, one aged 76 and the other just over 80. The older sister was taken into part III accommodation. I received correspondence from the younger sister, a Miss Gladys Lane, who used to live in Eastern avenue, Newbury Park, in my constituency. The house in which she lived with her older sister was the family house, and it had been owned by their parents. The family moved into it in 1934 and it was eventually passed on to the older sister. The two sisters lived together, sharing expenses on a 50–50 basis. Eventually the older sister had to be taken into a council home.
    Through ignorance, the ownership of the property was vested in the older sister and the younger sister had no title to it. Although the older sister had left the property in her will to the younger sister and the younger sister quite naturally expected to inherit it in due course, she was in for a nasty shock. When the older sister went into a home, she was asked to pay the sum of £ 111·30 a week. That sum has now risen to £116·14 a week. To those ladies, that was an enormous sum. It was impossible for them to pay that money out of their normal income. The younger sister, who was left in the home in which she had lived since 1934, approached the local housing aid centre in York road, Ilford. She was offered a single person's bed sitting room with a shared bathroom. She objected to that offer and went to the citizens advice bureau, which found her a good solicitor.
    After several months of negotiations the local council consented to the sale of the house and the purchase by the younger sister of—in the council's words—accommodation more suited to her needs. Miss Lane found the flat in which she now lives. It consists of a lounge, bedroom, kitchen and bathroom. She has settled in and has no complaints about it. However, a charge has been placed upon the flat by the local authority which must be repaid if she ever sells it. There was a difference of £6,000 between the proceeds of the sale of the house and the cost of the flat, after all the legal expenses had been paid. The council took every penny of this money and now has the deeds of the flat.
    Miss Gladys Lane naturally feels that the law is cruel and unjust. She is unaware that hers is not an isolated case. According to the advice that she has received from the CAB and from her solicitor, the practice is widespread. The CAB advisers have told her that they constantly have to deal with similar cases involving sons, daughters, brothers, sisters and other family members living in properties which are legally occupied by a close relative. When the owning relative has to be taken into care, the family members find that they have no legal right to the property or interest in it of any kind.
    In Miss Lane's case the council decided, as she had lived in the house for so long and it had been the family home, to allow her to purchase a small flat. However, Miss Lane, who was in her mid-70s, had to have a major fight with the council to persuade it to agree to that. She is most anxious that others in similar circumstances should not find themselves in the same predicament.
    Miss Lane makes the point that she has never claimed anything from the state and had had no intention of doing so. She feels herself to be at a grave disadvantage in that this matter is hanging over her head. She feels that there is no just reason why that should be so.

    911
    Moreover, Miss Lane's older sister, who is now in a council home, is a former civil servant. She had worked in the GPO telephone service all her life, and her pension is now paid by British Telecom. The money is paid into a Girobank account in the joint names of the two sisters. The older sister's pension amounts to about £165 a month and this, with the state pension, is her sole income. The younger sister, Miss Gladys Lane, has had to make an arrangement with the council whereby every quarter a cheque for £480 is paid over to the council to offset a portion of the debt which is building up for her older sister's keep in the home. Miss Lane is very worried about that. By 13 October this year the amount had risen to no less than £2,965·12 in spite of all her efforts to reduce it as much as possible. Through having lived throughout their lives without calling upon the state for support at all, the sisters are now debtors to part of the state system—through no fault of their own—to the extent of almost £3,000.
    One might consider that that was enough—but no. Of the older sister's state pension, she receives only roughly £6·80 a week as pocket money. She still has to pay income tax on the pension which she receives from BT before the balance is shunted on to the council. The situation is appalling.
    These elderly ladies have lived a life of hard work, dedication, effort and thrift. Our present Government do all that they can to encourage thrift. They encourage people to own their own homes. In view of the increasing number of us who are moving into the home-owning sector, I believe that such problems will increase in number.
    Several matrons of elderly people's homes have told me that they do not like elderly people entering their homes with money raised either from their own assets or through the sale of their house, because such people enter the home feeling very resentful about the way in which the money has been taken away from them. Matrons have told me that, in their view, these elderly people should spend the money before they enter the home. They should go on a world cruise, ending up at Monte Carlo, and have a good time. They should get rid of everything they have, because no distinction is made between whether they finance their stay in the home or whether the DHSS and the ratepayer do so. That is a strange philosophy, and one which I do not believe the Government would normally wish to encourage.
    However, there are other matters which we should consider. My hon. Friend may tell me that the local authority has discretion in the matter and can find part of the cost out of the rates. Some local authorities have been more profligate than others. The two elderly sisters live in the London borough of Redbridge, which has been Conservative-controlled for the past 20 years and has been extremely careful in balancing its budget. The council has made sure that it has not spent more than necessary, and the ratepayer has benefited. When such a council is then told to reduce its budget further, it finds it difficult to do so, because it has already cut spending to the bone.
    The leader of Liverpool council was crowing on television last night about the fact that his council had rebelled against the Government and forced them into allowing the council an additional £30 million last year. Redbridge is not in that happy state. The council tries to
    912
    follow not only the letter of the law, but the wishes of the Government about cutting back on expenditure and reducing manpower. There is therefore now no fat to cut away, and the council must look after every penny. It is therefore not able to give way on matters of discretion as easily as local councils which have built up a reserve of fat over the years.
    If the Government wish to encourage thrift through investment particularly in home ownership, they must face the problems that could arise when one of the occupants of a property goes into part III accommodation. They must lay down strict guidelines, if necessary reinforced by law, to detail specifically what should happen to a property which has been occupied for some years by a companion, and especially if that person is a close relation.
    If a companion has been sharing that accommodation for five or 10 years, or even longer, a legal entitlement to a 50 per cent. interest in that property should be written into the regulations. Such a person should be treated as a spouse. It is only through the support that is given by such people that the state is saved a great deal of money over many years. Such care prevents the other person having to go into hospital or part III accommodation at a much earlier date. I do not believe that to introduce such a measure would be charity—it would be doing the right and proper thing.
    If a person goes into part III accommodation, we should make provision for him to make a capital payment. The cost of part III accommodation could easily be calculated. The person going into that accommodation should be able to buy an interest in it so that when he leaves that accommodation, either because of death, going into hospital or because he is taken out of care, the district valuer would find it feasible to reassess the value of that person's interest in the accommodation, and he or his estate could be reimbursed. The elderly person would not then feel aggrieved at the constant drain on his resources of between £5,000 and £6,000 a year at current prices. That person would have owned a part of the home in which he lived.
    Of course, there would be the running costs of the home and the supervision required, which would be recurring charges. They could be set against the capital assets in due course if there were insufficient resources to fund those also. I see no reason why the elderly should not be given the right and the dignity to own an interest in the property they occupy for the remainder of their lives. It is what the Conservative party stands for—property ownership and the dignity of the elderly. The Government would be doing the right and proper thing if they extended home ownership into part III accommodation and allowed people to own an interest in it.
    I hope that my hon. Friend the Minister will throw some further light on the appalling position in which so many elderly people find themselves. They are worried about receiving a bill of such magnitude day after day, week after week, month after month and year after year, which mounts up to sums that are quite foreign to them because some of them retired many years ago. Sums in three or four figures worry them. We should try to lift the burden from those people and save them from taking the matron's advice and throwing it all away.
    10.54 am
    The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): In

    913
    raising the question of charges for local authority residential accommodation my hon. Friend the Member for Ilford, South (Mr. Thorne) has raised an important and complex subject, and has done so with characteristic thoroughness and a pragmatic approach. It reminds me of the way in which he dealt with the last social services questions, not only in his capacity as an hon. Member, but as chairman of the National Council for Civil Defence. He mentioned the important issue of civil defence planning, and the effect on that of plans within the DHSS.
    I welcome what my hon. Friend had to say this morning. I hope to clarify at least some of the misunderstandings about current arrangements. My hon. Friend drew attention to an apparent anomaly — that people admitted to local authority residential accommodation are required to pay towards its cost, while those in long-stay geriatric accommodation are not so required. My hon. Friend gave two excellent and telling examples of two elderly sisters residing in his constituency. We wish them well. It is right that time in the House is devoted not only to main issues but to the welfare of individuals.
    The requirement on local authorities to provide residential accommodation for those
    "who by reason of age, infirmity or any other circumstance"
    are in need of care and attention that is not otherwise available to them dates back to the National Assistance Act 1948. I am sure that my right hon. and hon. Friends who are now filling the Benches in the Chamber will be sorry not to have heard my hon. Friend make his point on that important issue.
    The purpose is to provide accommodation for those no longer able to live in their own homes, even with the support of community services such as home helps and meals-on-wheels. It was never the intention that the state should relieve people directly of the cost of their accommodation and upkeep. Rather, the 1948 Act provides that those who enter residential accommodation
    914
    —currently more than 100,000 people—should meet the cost of providing that accommodation to the extent that their means make that practicable.
    The NHS was, of course, established for quite different purposes, and on the basis that health services are, in general, free at the time of need—something on which the Government set great store. The vast majority of patients receive treatment from their general practitioners or on an outpatient basis. It is true, unfortunately, that some patients are destined to spend the last years of their lives in hospital, despite the magnificent efforts made by consultant geriatricians, geriatric nurses and others to ensure that as many as possible are rehabilitated to the community or other long-term accommodation. To that extent, the position of the elderly patient in a geriatric ward, for whom there is no possibility of discharge, is similar to that of the elderly residents of an old people's home.
    We have considered instituting "hotel charges" for NHS patients, but have rejected that essentially because hospitals are not geared for the billing and collection of debts on a large scale, especially as there would be exceptions for those in receipt of supplementary benefit, family income supplement and other forms of help from the social security system. I see my hon. Friend the Minister for Social Security nodding. For such a charge to be worth collecting it would have to be set at a fairly high level, with the risk that it would deter people from seeking necessary treatment.
    The Government have set their face against that. There are, however, provisions under which long-stay patients receiving retirement pensions and all other national insurance benefits which contain an element for day-to-day living have their benefits reduced after a certain period in hospital.
    It being Eleven o'clock, MR. SPEAKER interrupted the proceedings, pursuant to Standing Order No. 5 (Friday sittings).

    British Telecom
    The Minister for Information Technology (Mr. Geoffrey Pattie): With permission, Mr. Speaker, I should like to make a further statement about the privatisation of British Telecom.
    This morning, Kleinwort Benson Ltd. on behalf of my right hon. Friend the Secretary of State has offered for sale 3,012 million ordinary shares in British Telecom plc at a price of 130p per share. The issue has been fully underwritten. Discussions are now taking place with a group of financial institutions, and I am hopeful that, within the next few hours, the shares being offered in the United Kingdom will have been fully applied for. Subject to the successful outcome of these discussions, the institutions will retain just over half these shares and the remainder will be made available for public offer next week. Prospectuses will be published on Tuesday 20 November, and the last date for applications will be 10 am on Wednesday 28 November. Copies of the prospectuses will be placed in the Library of the House today.
    Of the shares on offer, 415 million, which is just under 14 per cent., have been provisionally allocated for issues to be made in New York, Tokyo and Toronto, and these are being underwritten by the Bank of England.
    Mr. Alan Williams: I thank the Minister for coming to the House to make the statement, although it is marginally disconcerting, as the hon. Gentleman will understand, to be handed a revised version two minutes before the statement was delivered.
    This is an incredible day—a day when a Government who pretend to be worried about the future of high technology are announcing the price at which they intend to hand over to the whims of short-term profit maximisation the very industry that will be at the centre of the information technology revolution. It is a day when the Government are taking a public monopoly, which is answerable to Parliament, this House, the Minister and the Select Committees, and are creating a private monopoly that will control 95 per cent. of the telecommunications network and will be answerable to no one other than its shareholders. [Interruption.] Well, at the moment it is answerable to 55 million people.
    While the price of 130p is precisely what I forecast in a broadcast two days ago, I repeat what I also said at that time: it is the wrong price. Are the Government aware that the very City experts who are advising the Government firmly expect that when those shares are traded on the stock exchange they will start trading at a premium of at least 10 per cent.? Does the Minister realise that that price will mean that the Government are selling control of more than £16 billion worth of public assets for less than £4 billion?
    Will the hon. Gentleman confirm that, in addition to his price error, the combined cost of advertising by British Telecom this year and by the Government in relation to the launch and the commissions that will be paid to the underwriters and the banks will be at least £100 million and probably nearer £150 million — all to the Government's friends in the City? Is it not true that, behind the Government's boast that they intend to extend share ownership, they are taking this asset, which will earn £1·3 billion in profit this year, from the 55 million people
    916
    of Britain who own it at present in order to sell it at a knockdown price to a relatively small proportion of those people?
    Finally, is it not already clear, before British Telecom is sold, that the Government's guarantees are absolutely meaningless? The Minister has said that 14 per cent.—415 million shares—have been provisionally allocated for sales overseas. Is the hon. Gentleman aware that another 3 per cent.—90 million shares—will be bid for within this country out of the British tranche by an overseas consortium? Is there any control over such bids by other consortia? What action do the Government intend taking to stop the erosion of any control on the sale overseas?
    Finally, in relation to these guarantees—
    Sir Anthony Grant: Another one?
    Mr. Williams: Yes, I am referring to the same guarantees. Have we not already seen the hollowness of the Government's pledge to domestic users that privatisation will mean that, for five years, prices will be cut to at least 3 per cent. below the cost of living? We have already seen, in anticipation of privatisation, increases of 7·1 per cent. for domestic rentals and 6·8 per cent. for domestic unit charges — both well above the cost of living — and reductions in prices for primarily trunk business users.
    Mr. Pattie: The right hon. Gentleman has told the House that this announcement will have the remarkable effect of making British Telecom answerable to its shareholders, which, in his mind, is supposed to be a retrograde step. The Government believe that this step, which shows that it is bigger than all the Government's privatisation measures so far, will make British Telecom even more commercially aware than it has been. In future, British Telecom will have to satisfy both its customers and its shareholders. Apparently, the right hon. Gentleman thinks that does not matter.
    The message that should go from the House is that we wish the chairman of British Telecom, his employees and the new shareholders after 3 December every success in making this the vigorous enterprise in the private sector that we know it will be. The right hon. Member for Swansea, West (Mr. Williams) will understand the reasons why I cannot enter into any speculation about price considerations at this stage.
    Sir Anthony Grant: Will my hon. Friend totally disregard the niggardly and preposterous objections from the Opposition about a policy that is entirely welcomed by Conservative Members and is designed to get the clammy hand of the state away from future technological industries? Conservative Members wish the policy every possible success.
    In view of the Government's enthusiasm for wider share ownership and the spread of ownership, will there be any provisions to ensure that the many small investors will not find that their applications are swamped and the issues hogged by big business investors?
    Mr. Pattie: I am grateful to my hon. Friend for his words of welcome. I can assure him that, as the Government's aim in this matter is to spread share ownership as widely as possible, the requests and applications of the smaller investor will be given priority wherever possible.
    Mr. Ian Wrigglesworth: Will the Minister be a little more forthcoming? He ended by saying, "wherever possible". If the issue is over-subscribed, who will make the decisions on the allotment of shares? On what basis will that allotment be made? There will be many dissatisfied small investors if they find that, having been encouraged to buy shares in this institution, their applications are turned down. Will the Minister comment on the view held in the City that, if any other share issue had been handled in this way, it would have been illegal? Will he consult his colleagues and look into the possibility of extending the type of share offer that has been made in this case to other share offers so that a wider public can come forward to buy shares in other institutions?
    Mr. Pattie: The precise basis of the allocation to which the hon. Gentleman referred will be decided by my right hon. Friend the Secretary of State. I have said already, and I am happy to repeat it, that the Government are committed to wider share ownership and that we value small shareholders.
    The hon. Gentleman made a rather serious point about possible illegalities. I should like to consider what he said. Perhaps he would like to write to me about it.
    Mr. Rob Hayward: Does the Minister find the statement from the Opposition Front Bench particularly surprising in view of the fact that, during the Committee stage of the Telecommunications Bill, we were persistently told that the share offer to the public would be grossly under-subscribed because no one would find it attractive? Is it not a reflection of the expertise of all the BT employees that they have managed to convey to the public at large that they are now working for a modern communications system, and that large numbers of people in this country and abroad now wish to subscribe for shares in BT?
    Mr. Pattie: I am grateful to my hon. Friend. His reference to a change in attitude within BT is well substantiated, not only by the advent of privatisation but by the whole concept of greater competition which results from having other people coming into the market. It has produced a tangible improvement in the performance of BT. He is right in saying that the offer has created a great deal of interest here and abroad, because BT is a very powerful British and international company.
    Mr. John Golding: Is it not a disgrace that BT shares are being sold to the Yanks and the Japanese? Is it not a disgrace also that BT is now inviting three foreign equipment companies to tender for equipment for BT?
    Will the Minister make it crystal clear to people abroad that when the Labour party renationalises BT it will do so in the interests of the taxpayer, the customer and the equipment manufacturing industry, and not in the interests of shareholders?
    Mr. Pattie: The hon. Gentleman's line is somewhat predictable. We believe that investment in Britain is not a disgrace. The investment is not cajoled; it comes here because it wants to come here.
    The hon. Gentleman mentioned equipment for BT. I am aware of the contract to which he referred. On the merits of that application, BT has decided that for the
    918
    second source — the first source having been totally British—it wishes to invite further applications from the three consortia.
    The hon. Gentleman mentioned what I regard as the remote and distant — not to say inconceivable —possibility of renationalisation by some future Labour Government. We believe that the interests of the taxpayer, the customer and the British manufacturer are totally safeguarded by the steps taken today.
    Mr. Michael Marshall: Will my hon. Friend agree that the history of recent privatizations—for example, British Aerospace and Cable and Wireless — shows that the employee shareholding is a crucial element in the operation? The right hon. Member for Swansea, West (Mr. Williams) mentioned accountability. Will my hon. Friend agree that the attitude of people who work in such companies and who have had such opportunities is wholly beneficial? Does it not hold out high hopes in that respect for the future of BT?
    Mr. Pattie: I am grateful to my hon. Friend for his comments, because he takes a close interest in these matters. People who are prepared to accept the evidence of their eyes and ears wall know that what he said is correct. When people appreciate that they are working for a company in which—as my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) said—the clammy hand of the state is not guiding all the marketing and commercial decisions, and that they have better possibilities and opportunities, their performance and that of the company improves accordingly.
    Mr. John McWilliam: Does not the Minister realise that he is flogging off the interest in investment, already made in BT by the 55 million people of this country, to a small number of people for their own private interest? Does he not understand that this doctrinaire attempt to widen the basis of share ownership is bound to fail once those shares become available on the open market?
    Mr. Pattie: I cannot see why it is wrong for ordinary people in this country to be given the opportunity to own part of a major national undertaking. The hon. Gentleman is making a forecast about the market for share dealing, and I dare say that his opinion is as good as that of anyone else, but the incentives, including those being offered in regard to telephone bills, will persuade people to keep the shares for all sorts of very good reasons.
    Mr. Fred Silvester: Will the Minister agree that those who have had a hand in the share issue have stimulated an interest in share ownership which is far beyond that previously experienced? May I suggest that we learn a lesson from the experience? It is not simply the privatisation programme that is important but the use of it to educate people in the holding of shares.
    Mr. Pattie: I am extremely grateful to my hon. Friend not only for that remark but for his appreciation, which I am happy to echo from the Dispatch Box, of the work of all the people who have been involved in bringing BT to flotation today. We are grateful to our advisers and all the officials who have worked so hard in my Department and in the Treasury. I am also grateful to my predecessor, my right hon. Friend the Member for Mole Valley (Mr. Baker), who laboured long and hard to bring the matter to a happy conclusion.
    Mr. Laurie Pavitt: Now that the sole criterion for this huge organisation is to be profitability, what steps can the Government take to protect the millions of pounds that are paid from the DHSS and other Departments for the benefit of the elderly and the disabled? The standing charges for free telephones for those living alone are now paid by the public. Is there any way in which those charges could be reduced, rather than profitability being the only criterion?
    Mr. Pattie: The hon. Gentleman's points will be matters for discussion between the Departments concerned—particularly the DHSS—and the management of BT. Wherever there are what might be described as social considerations, arrangements will have to be made, and the company will say on what basis it wishes to provide those services. The Government have made it clear that they wish them to continue.
    Dr. John G. Blackburn: Will my hon. Friend agree that this is not just a memorable day but an historic day in this House? Will he agree that it is welcomed by Conservative Members, just as it is self-evidently welcomed by the public, because the share issue will be over-subscribed? It is also welcomed by the staff of BT. Will my hon. Friend agree that it is one of the finest ways of ensuring investment from the private sector and relieving the burden on the taxpayer?
    Mr. Dennis Skinner: It has been a poor Tory turn-out for an historic occasion.
    Mr. Pattie: I am grateful to my hon. Friend for his comments. I agree with him that it is an historic day—although, as the hon. Member for Bolsover (Mr. Skinner) says, there could have been more people here to witness it. History is sometimes made when the audience is not very large, but I am sure that we are very happy to have the hon. Gentleman here.
    Mr. D. N. Campbell-Savours: Will not the Minister come clean? Is it not true that historically Governments wishing to raise revenue have put up income tax, value added tax or national insurance contributions, whereas this Government cheat by selling off the nation's assets, which have been built up through constant investment over the years? One day the British cupboard of assets will be bare and the Government will then have to face reality. May I say to Labour supporters outside that I hope that they will not buy the shares. If they do, they will be propping up the Government's disastrous financial policies.
    Mr. Pattie: I am sure that the hon. Gentleman's message will be heard; whether it will be heeded remains to be seen. At the time of the British Aerospace flotation, advice from union circles urged members not to take up the offer. The great virtue of this type of exercise is that it is up to individuals to decide. In that case, individuals decided to take up the allocation of the shares. I am sure that ordinary men and women will take the opportunity that is offered and will disregard the extraordinary advice of the hon. Gentleman. I am sure that they will not regard the exercise as selling off the nation's assets when they will be having a share in those assets.
    Mr. Eric Forth: I join those who have warmly welcomed the Government's move as part of the programme to restore the nation's assets to the people of the nation. Does my hon. Friend believe that BT
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    employees will subscribe to the shares, and has sufficient allowance been made for that so that they may participate in their own business and have a full sense of involvement and ownership in this great industry?
    Mr. Pattie: We believe that the employees will subscribe to the shares. Provided that they apply, there is a free allocation of shares for them as well as a special bonus arrangement in a certain ratio to the shares acquired. It is very important indeed that BT employees respond favourably to the offer and we hope very much that they will do so.
    Mr. Skinner: In view of the international selling, are the Government proud of the fact that there is nothing to prevent the Libyans buying shares in BT? What amending legislation is the Minister prepared to introduce to prevent that? The Libyans might well use for that purpose the money that they have obtained from Britain as a result of the Tories' purchase of an extra 400,000 tonnes of Libyan oil. Has the Minister considered the image that may result, with Mr. Gaddafi on one end of the line, Mrs. Thatcher on the other and Buzby in the middle?
    Mr. Pattie: I can only assume that by "Buzby" the hon. Gentleman has Arthur Scargill in mind.
    Mr. Skinner: You are allowing it.
    Mr. Pattie: I am not sure whether the hairdo is appropriate, although I realise that I am not in the best position to make jokes about that. We stand by the conviction of the institutions as to the importance of the offer. Among those institutions we hope that the NUM pension fund will be very important.
    Dr. Oonagh McDonald: Has the Minister noticed that, on the day of this important announcement, the Liberal Benches are entirely empty, showing Liberal Members' lack of interest in the Government's programmes and policies? Is he aware that, in selling BT, the Government are turning a justifiable public monopoly into what Lord Weinstock described as an unjustifiable private monopoly? On foreign investment, is he aware that in selling off NTT over five years the Japanese have had the good sense to disallow foreign investment so as to ensure that high technology developments resulting from future developments in their telecommunications industry will remain firmly in Japanese hands and under Japanese control? Why have the British Government not shown the same wisdom?
    Mr. Pattie: There is no reason why less than 14 per cent. foreign investment should mean that important new developments in advanced technology will go abroad. The company's interest will be substantially to maintain technological developments from excellent establishments such as Martlesham within the United Kingdom, so I see no need for the steps suggested by the hon. Lady.
    Referring back to the important point about BT employees raised by my hon. Friend the Member for Mid-Worcestershire (Mr. Forth), I should make it clear that each employee can apply for 54 free shares now, worth just over £70, and receive two free shares for every share purchased, up to a maximum of 154 shares. That is a very important start.
    Mr. Williams: Is the Minister aware that the new private corporation will be answerable to shareholders, most of whom will have too small a holding to be

    921
    significant, which is no substitute for accountability to the House, to Select Committees and to Ministers? He said that the corporation would have to satisfy the customers, but as a private monopoly it will have no need to do so. Indeed, the incentive to do so will be reduced because the corporation will not be answerable to the House and the voice of the consumer will be weaker in the new organisation.
    Will the Minister now answer the important question that he has so far ignored about the overseas consortium intending to buy from within the United Kingdom tranche to the tune of nearly 100 million shares if it can get its hands on them? Is he aware of that consortium and is he concerned about it? Does he intend to take any action, or will overseas buyers be able to apply indiscriminately within the United Kingdom tranche in addition to the 450 million shares allocated for sale overseas?
    On equipment purchases, will the Minister confirm that at present 95 per cent. of BT's equipment needs are met from within the United Kingdom and that £13 billion worth of orders per year are placed with British firms, keeping 70,000 jobs in more than 80 private companies? Is he aware that the chairman has said that as soon as BT is privatised he intends to place more orders with foreign factories?
    Mr. Pattie: I will take those questions in reverse order. On the last point, I am not aware of the statement by the chairman Sir George Jefferson, to which the right hon. Gentleman refers. Naturally the chairman will wish the company to operate in the most commercially successful way possible. As I know from my many discussions with Sir George Jefferson, he does all that he can to support the British equipment industry and is prepared to lean as heavily as he can in that direction, but he will not be subjected to the clammy hand of Government direction, as my hon. Friend the Member for Cambridgeshire, South-West (Sir A. Grant) described it, compelling BT to make
    922
    acquisitions from parts of British industry whose equipment may not be the most up to date. We wish to achieve greater efficiency and greater pressure from competitive power. Telling British industry that it can rely on BT orders for ever and a day does not help it to be more effective and competitive in world markets. British companies have the opportunity to tender and will obviously get the lion's share of BT equipment orders in years to come. We are simply letting in an element of competition, in the same way as the Ministry of Defence has done.
    I am not aware of the overseas consortium to which the right hon. Gentleman refers. He will appreciate that I cannot comment publicly from the Dispatch Box at this stage about how share prices may move or who might want to purchase the shares. As the right hon. Gentleman well knows, however, there is a limit of 10 per cent. on all applications and that will be very closely scrutinised.
    Mr. Williams: That has nothing to do with it.
    Mr. Pattie: With respect, it has something to do with it because the overseas dealings will begin after applications have closed on the London stock exchange at 10 am on 28 November, when 14 per cent. or slightly less than that will be available for overseas investors.
    Mr. Williams: So they can buy anything they like?
    Mr. Pattie: I must continue, as the right hon. Gentleman made another important point. He seems not to appreciate that competition will be policed by Professor Carsberg, director-general of the Office of Telecommunications — DG-Oftel — who, through his advice to the Government on the Jove application for the joint value added network service between IBM and BT, has already shown that he takes the need for competition very seriously. That is the best safeguard that we can have.

    Sheltered Accommodation
    Question again proposed, That this House do now adjourn.
    11.29 am
    Mr. Patten: Furthermore, this reflects in part the fact that they are relieved of some of the costs of living at home. I accept that the different arrangements applicable to long-stay patients and residents in old people's homes can be regarded as an anomaly. I think that I see my hon. Friend the Member for Ilford, South seeking to ask me to give way on that point.
    Mr. Thorne: Will my hon. Friend please take into consideration the very unpleasant effect that constant bills have on the elderly? It is one problem for young people to receive them, but it is another when elderly people receive substantial bills. In this case, my constituent received a bill for her sister's accommodation for nearly £3,000. Every quarter yet another bill arrives, so the bill becomes greater quarter by quarter. She has already paid £6,000, so the most recent bill makes the total £9,000. She would like to know what happens when the entire value of the present accommodation is used up. Is that not an immoral way to proceed? Should we not be much more humane and let the sister carry on with her life without that millstone hanging round her neck?
    Mr. Patten: I entirely appreciate my hon. Friend's concern for the welfare of his constituent and his constituent's sister. I shall bear in mind everything that he said. Perhaps my hon. Friend will be so good as to write to me with full details, including the bills that he mentioned this morning, so that as soon as possible I can go into the important points that he made on behalf of his constituent, with his characteristic care.
    We have no plans to introduce "hotel charges" for NHS patients, or to abolish the 1948 provisions under which residents in local authority homes are required to contribute towards the cost of their accommodation. My hon. Friend also drew attention, in his most interesting speech, to the current arrangements for assessing what the contribution should be. We are open to new ideas. The current charging system is designed to reflect people's ability to contribute to the costs of their accommodation.
    There has been concern that those charging arrangements need revision—my hon. Friend has been foremost in suggesting it — and particularly that they should be brought into line with the rules for paying supplementary benefit where, for example, capital of up to £3,000 is disregarded. Earlier this year we issued a consultative document setting out proposals for new revised arrangements. The response was not enthusiastic. Generally, our proposals were regarded as too complex. One of the points about consultation is getting such feedback. The arrangements were regarded as too complex, particularly those for calculating the notional income which should be assumed to derive from capital.
    Since the proposals were issued we have, of course, started to review arrangements for supplementary benefits, as my hon. Friend will be aware. We have decided to delay further consideration of the whole range of issues that lie behind the points made by my hon. Friend until that review is complete. I assure my hon. Friend, however, that in taking our thinking forward we shall give careful consideration to the points that he made so lucidly.

    Mobility Allowance
    11.33 am
    Mrs. Edwina Currie: I am glad to have the opportunity of raising the case of Shelley and Russell Tulloch.
    The case raises interesting topical questions concerning mobility allowances and who is eligible to qualify. Shelley and Russell are two constituents of mine who live in Melbourne, which recently won the best-kept village competition in Derbyshire. Shelley was born in December 1960, and therefore will soon be 24, and Russell was born in October 1962, and is now 22. When Shelley was three, it was clear that something was seriously wrong. She was diagnosed as suffering from a rare chromosomal abnormality. By that time, Russell had been born, and it was too late. That family now has two vigorous mentally handicapped adults in the household.
    The main feature of the disability is mental handicap. It is slowly progressive, getting worse in the most tragic way. It is accompanied by mild motor problems, such as clumsiness. Russell also has petit mal and is treated with phenobarbitones and other drugs. However, it appears that his condition is not controlled, but is slowly getting worse. Indeed, the drugs seem to make his behaviour more unpredictable and make him less co-operative. Shelley does not have those problems, but she is much more aggressive than her brother and also occasionally suffers from deafness. The main difficulty with them both is behavioural problems, because they are unpredictable, and can be very noisy, aggressive and persistent. They tend to pester strangers and their activities may be unreliable.
    I should like to quote from the original application by Mrs. Tulloch for the mobility allowance back in September 1982. It explains clearly what the family's problems are. Mrs. Tulloch said:
    "I am applying for the Mobility Allowance on their behalf to help towards the cost of my own transport, which is a necessity to enable us to have any life outside the house, as I cannot cope with them alone on public transport for the following reasons:—

    1. They are very outgoing by nature but can be aggressive towards me when restrained.

    2. They can make a nuisance of themselves with other passengers by going to sit with strangers and chatting incessantly about nothing or asking personal questions. Some people don't mind, but others do, or are unable to cope with the situation.

    3. They argue and fight with each other a lot which can be embarrassing, especially if they start swearing.

    4. Public transport runs to time schedules, mentally handicapped people can be very stubborn when they want to and 5/10 minutes on your side makes a great deal of difference when you have appointments to keep. Public transport will not wait for you!

    5. We live in a rural area and I travel 8 miles into the nearest town at least twice a week to take them to a Youth Club, as there are no facilities for them in our immediate area. If I went by bus we would have to walk about a ¼ mile from the nearest bus stop to the Club. On other evenings I take them to other places or just for a run somewhere to get them out. They don't like walking any distance, and their powers of concentration are poor, consequently they will not sit at anything for long, so I find through experience the best solution is to take them out. I also have regular hospital, dental and doctor's appointments to keep for both of them."

    As part of the exercise for today's debate, I asked Mrs. Tulloch to make a note of the essential mileage that she did on behalf of those young people that was associated not with their attendance at the day centre, but with activities such as riding for the disabled, sports clubs,

    925
    swimming and attendance at a gateway club run by the local branch of Mencap. To her own astonishment, she realised that she was doing over 9,000 miles a year in her own car on behalf of the two young people. The result is a commendable quality of life. It is entirely right that I should pay tribute to Mr. and Mrs. Tulloch for the care, dignity, intelligence and good humour with which they have cared for those very disabled young people for more than 20 years, and with which they intend to go on caring for them.
    We should also pay tribute to all the staff at the special school that the young people used to attend in my constituency and now at the Newhall adult training centre run by Derbyshire social services, and all the professional staff associated with Russell and Shelley, for the extraordinary way that they help the family to cope. I have no doubt from what I have seen elsewhere that without such attention and care both those young people would have been in institutions a long time ago.
    The difficulties are recognised through the payment of attendance allowance for both young people and, of course, they both qualify for non-contributory invalidity pension. However, Mrs. Tulloch does not qualify for invalid care allowance, as she is a married woman. Whatever the difficulties of coping with one mentally handicapped person in the household, I am sure that the House will recognise that they are compounded by there being two.
    The history of the application for mobility allowance starts more than two years ago. On 22 September 1982 the claim for mobility allowance for both young people was received and a medical examination was arranged. The examination was carried out on 29 December 1982 and refusal was recommended. On 18 February 1983, Mrs. Tulloch lodged an appeal. A further medical examination by the medical board took place on 8 June 1983 and it recommended acceptance and payment of mobility allowance for Shelley and Russell. There was jubilation in the Tulloch household when they were informed of the positive decision on 18 July. It is worth observing as an aside that it had taken nearly nine months from applying for to being granted. Although the allowance is backdated, the delay is typical and is much to be regretted.
    The Secretary of State then decided to appeal to a medical appeal tribunal and the hearing was held on 22 September 1983. The Secretary of State's appeal was allowed and mobility allowance was refused. The family was notified on 2 November 1983. An appeal against a medical appeal tribunal's decision can be made only on a matter of law.
    My involvement commenced soon after. Till June 1983, Mr. and Mrs. Tulloch had been the constituents of my hon. Friend the Member for Erewash (Mr. Rost), who I know had been active on their behalf and had given them excellent advice. That it was excellent advice is shown by the fact that they had achieved mobility allowance. I first met them on 18 November 1983 and I wrote to the Secretary of State on 6 December. I know that the letter was received as it was acknowledged. Unfortunately, everything seemed to grind to a halt at that point. I wrote again on 29 February and again on 17 July 1984. I am not being awkward and I hope that I have not been nagging. I know that Ministers are deeply and genuinely concerned about the mentally handicapped. They have shown that in regard to many cases. However, I must ask whether it
    926
    would be possible to have a reply to the correspondence that I have sent during the best part of what now amounts to one year.
    Why did the DHSS appeal against the award when it had been granted after two medical examinations? Why did the Department not leave well alone? I think that part of the answer lies in the Secretary of State's observations to the second appeal, which goes to the heart of mobility allowance regulations and limitations. I should like to quote from it. Mobility allowance is payable under the Social Security Act 1975 to someone who is suffering from physical disablement to the extent that he is either unable to walk or virtually unable to do so. As to the virtual inability to walk, the Secretary of State observed:
    "It is for the tribunal to decide how far ability is affected by impairment of balance, inco-ordination of movement, behavioural limitations, the reed for guidance, supervision or support … In their statement of reasons for three decisions dated 4 January 1983 a Tribunal of Social Security Commissioners gave guidance on the relevance of assistance needed and behavioural factors in determining whether a person is unable or virtually unable to walk. The Commissioners decided that a person who is able to walk only with assistance (ie guidance, supervision or support) should not for that reason alone necessarily be found to be unable or virtually unable to walk. The Commissioners considered however that the need for such assistance was a facet of the manner in which a person could make progress on foot and should be taken into account by the adjudicating authorities … Similarly the Commissioners considered that behavioural limitations on a person's walking ability would also generally affect the manner, and possibly the speed, of his walking. They considered that if a person could be caused to move himself to a designated place only with the benefit of guidance and supervision and possibly after much cajoling the point may be reached at which the person may be found to be virtually unable to walk."
    That view was clearly taken in the first appeal but not in the second.
    This is the crux of the matter. There is no argument about these young people being able to put one foot in front of the other. If they were in the House, they could walk from one end to the other. They have some trouble with steps and may have difficulty if they are not familiar with the area. It also depends substantially on their mood whether they will budge at all. That is not the problem. The more important fact is that they cannot go far without supervision. They cannot use public transport alone—they would be in some danger if they did and they would certainly be a nuisance to other passengers. They require constant care, guidance and control and without help they are just as housebound as if they were physically handicapped.
    I am aware that many cases are under review. One is currently under discussion in another place. The entire issue of disability is under review. That effort by right hon. and hon. Members is to be welcomed. The question is whether mentally handicapped people are disabled. I say that they are, as they cannot travel independently. I believe that we should change the mobility allowance rules and allow them to claim.
    Mobility allowance has been one of the most successful of all recent benefits. More than 300,000 people currently claim the comparatively modest sum of just over £18 a week and about 10 per cent. have commuted the money to enable them to buy a vehicle. Since 1979, there has been a more than 100 per cent. increase in the benefit in cash terms. There is no doubt that the Government have made every effort to be generous to disabled people. However, the regulations are restrictive and out of date. They were old-fashioned when they were proposed, in that they did

    927
    not take account of mentally handicapped people who are now living in the community in greater numbers. If we are to make headway in caring for such people in the community and if we are to give reasonable support to such families and parents, we should grant applications such as this.
    Tragically, sooner or later, this family will have to give up caring for these disabled people at home. Shelley and Russell's conditions are getting worse and their parents are getting no younger. However, it will happen later by many years rather than sooner if appropriate help is given. It is the DHSS's view, which is well stated in many policy documents, that it is cheaper and better to care for people at home. That has been at the heart of DHSS policy for many years. I therefore urge my hon. Friend to consider these matters sympathetically.
    11.46 am
    The Minister for Social Security (Mr. Tony Newton): I am grateful to my hon. Friend the Member for Derbyshire, South (Mrs. Currie) for raising this sad case today. I am glad that she has had an opportunity to do so. She will realise that, in view of the way in which she has, with her customary initiative, seized the opportunity at fairly short notice, I have not been able to refresh my mind on the details of the case to the extent that I would normally wish before replying. She deserves the admiration of her constituents for the way in which she has pursued the case and for raising it today. Constituents who have such an assiduous Member of Parliament pursuing their interests are indeed lucky.
    The debate enables me warmly to join in my hon. Friend's tribute to Mr. and Mrs. Tulloch for their devoted work in bringing up Shelley and Russell. Their work must command the admiration of us all. Having experienced the problems that mental handicap can bring, though not in my immediate family, I appreciate what devotion must have been required from Mr. and Mrs. Tulloch. I have listened with great sympathy to what my hon. Friend has said. I shall study her speech with care and look into the delay in responding to her letters. I shall ensure that we are in touch with her as soon as possible.
    I endorse what my hon. Friend said about the importance of mobility allowance and about the emphasis that the Government have put on it and confirm the figures that she gave. Mobility allowance is now received by about 340,000 claimants, at a cost of about £360 million a year. The Government's commitment to the benefit is reflected in the fact that it will have been virtually doubled by the uprating in a week's time, when it will reach £20 a week. It is an important benefit in the network of benefits available to disabled people.
    At a tangent to the main thrust of my hon. Friend's argument, I noted her reference to the delays that take place in processing mobility allowance claims. It is an inescapable fact that if a claim goes to appeal, whatever its route, it is likely to experience longer delays than an ordinary, straightforward claim. Given that the numbers of claims for the benefit have been rising rapidly—the Government welcome that—and that their assessment depends on the use of scarce medical manpower, the difficulties are clear.
    My hon. Friend knows that it was as a result of our general concern about the delays occurring to mobility
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    allowance claims that my predecessor as Minister for the Disabled, my hon. Friend the Member for Hornsey and Wood Green (Sir H. Rossi), commissioned a report by a retired civil servant, Peter Oglesby. The report made a number of recommendations, including ways to speed up the administration of mobility allowance claims. The Government have acted on a significant number of those recommendations, although some remain under consideration.
    As a result, the past two years have shown a significant speeding up of the processing of mobility allowance claims. I pay tribute to the work of our officials at North Fylde central office in Norcross, who have put great effort into improving the way in which claims are handled. We are doing everything we can to reduce those delays and to keep them to a minimum, and we have already had considerable success.
    I now turn to specific issues connected with the case of Mr. and Mrs. Tulloch and of Shelley and Russell. In view of the age of Shelley and Russell, any claim for mobility allowance is technically a claim by them. For anyone over 16, the claim and payment of the benefit is to the individual concerned rather than to his parents. Perhaps that shows how difficult it would be to follow my hon. Friend's suggestion and consider some mobility allowance claims together and some circumstances as a whole. The benefit is paid to individuals and claimed by individuals. If one attempted to consider some claims together, it would be difficult to decide which individuals should be lumped together for the purposes of a claim. I hope that my hon. Friend will accept the considerable difficulties which her suggestion would create.
    My hon. Friend implied that in the adjudication on such a benefit it should be possible to consider circumstances such as the availability of public transport and other factors affecting the environment of claimants. I have heard that argument before. At first one reacts sympathetically to it, but when one considers it seriously it is difficult to see how one could make differentiations equitably in the payment of this or other social security benefits according to geographical location. To give an obvious and crude example, it would be absurd if a person who happened to live in north London was refused mobility allowance because he was on a bus route and consequently moved to a remote village in Essex to qualify because he was no longer on a bus route. I hope that my hon. Friend accepts the difficulties inherent in such differentiation.
    The major thrust of my hon. Friend's remarks related to the position of mentally handicapped people under the mobility allowance scheme. As she said, there has recently been difficulty in interpreting the regulations for mentally handicapped people and for other categories of potential or aspiring claimants. They include blind people, whose needs were the subject which last brought me to my feet in the House this week, and of deaf-blind people.
    There are obvious difficulties and disadvantages in specifying particular types of disability as automatically qualifying for benefits designed to reduce the consequences of disability. I hope that my hon. Friend will agree that many mentally handicapped people would not qualify for mobility allowance. I have visited the large mentally handicapped hospital in my constituency on a number of occasions. Many people there have no difficulty in walking and making their way about, although they are mentally handicapped. However, I accept that certain conditions and degrees of mental handicap can cause real

    929
    difficulties in that direction. I merely seek to establish that one cannot sensibly say that mental handicap alone, without regard to its degree, extent or consequences, should be taken as an automatic passport to the payment of mobility allowance.
    Recently, the process of determining the interpretation of the mobility allowance rules has given rise to considerable discussion among adjudication authorities—this will soon reach even higher levels—about how the regulations should be applied to the mentally handicapped, the blind, the deaf-blind and other categories. As my hon. Friend said, a tribunal of social security commissioners dealt with claims from three mentally handicapped children in an effort to clarify the interpretation of the legislation for people who needed assistance to move around. The decision was reported as R(M)1/83. In their decision, the commissioners held that the need for guidance, supervision and support was a facet of the manner in which a person could make progress on foot and therefore should be considered by independent adjudicating authorities in deciding claims, but that it was not in itself conclusive.
    Earlier this year, the Court of Appeal gave judgment in the case R(M)1/84, which involved a blind person who had directional problems. In that case, the question of guidance, supervision and support was a relevant factor. The claimant was unsuccessful, but the extent to which the judgment affects the conclusions reached in R(M)1/83 is arguable. Case law is therefore in an unsatisfactory state, but we hope that that will be resolved, as the case reported in R(M)1/84 is now on appeal before the House of Lords in its judicial capacity. The hearing is due on 7 March 1985 according to my latest information. I am sorry that that is still some time ahead. When we have the results, we shall consider the need for further guidance and, if necessary, we shall amend the regulations in the light of it. I can make no promises about what we might think it appropriate to do in the light of the outcome, but we are conscious of the difficulties in interpreting the regulations in cases such as those of Shelley and Russell Tulloch. Although I cannot hold out an immediate hope of a dramatic change, I hope that I have said enough to show that we are worried about the problem and that we wish the position to be more clear.
    I cannot say much more to my hon. Friend today. We are genuinely and deeply sympathetic to the problems that she described, and I am glad to know that the Tullochs are receiving substantial support from the social security system in the form of attendance allowances in both cases and non-contributory invalidity pensions, which will shortly become severe disablement allowances, in both cases. That reflects Ministers' anxiety — certainly my anxiety as a social security Minister with responsibility for the disabled — to ensure that support is available to families in such circumstances. I can say nothing more about the specific mobility allowances in this case, but I shall be in touch with my hon. Friend as soon as possible.

    Tranquillisers
    Mr. Gerald Bermingham: I am grateful to the Minister for giving me the opportunity of raising this matter at such short notice. I wish to bring to the attention of the House a fairly well known and widely canvassed problem that is developing steadily with regard to the use of benzodiazepine drugs, which are more commonly known as tranquillisers. There are 10 or 12 drugs in that generic group, and I noticed from the statement of the Secretary of State the other day that many of the branded drugs that were taken off the prescription list will in future be obtained only privately and will be replaced in the National Health Service by substitute drugs. I welcome the use of generic substitutes, but I draw to the Government's attention the fact that the problem of addiction will be just as great.
    In reply to questions from me on 9 November, the Minister for Health said that in 1980 23·9 million prescriptions were issued for drugs within the group. To make clear what I am talking about, the group includes drugs such as Valium, Librium, Anxon, Ativan, Frisium, Halciom, Mogadon, Normison, Serenia-D and Transene. In 1981, the figure rose to 24·2 million; in 1982 it was 24·4 million; and for the first nine months of 1983—one accepts that it takes time to collate the figures—there were 17·7 million prescriptions. We cannot say how many drugs are issued with each prescription, but at a conservative estimate we are talking about more than 100,000 capsules in only nine months.
    I accept that there are clinical needs for what might be called anti-depressants, but I do not accept that the present method of prescribing them is always in the best interests of the patients. I do not challenge the clinical judgment of doctors, but I shall draw to the attention of the House some of the effects of prescription policy. It has been estimated by Professor Malcolm Lader, who is the professor at the Institute of Psychiatry and who has carried out research into this matter at Maudsley hospital in London for about five years, that there are about 100,000 tranquilliser addicts or dependants. He considers that to be a conservative estimate, and that the real figure is nearer 250,000.
    Why has that happened? Dependency upon those drugs causes many side effects such as agoraphobia, nausea, a loss of the sleep pattern, an effect on one's ability to enjoy life and a general state of depression. Indeed, some of the researchers explained that the side effects are often such that they constitute a need for further drugs of the same generic structure.
    Mr. D. N. Campbell-Savours: My hon. Friend welcomed the change to generic drugs. Is there not a danger that the problem may be aggravated where a medical practitioner is subjected to pressure by his patient to prescribe the branded drug, because the patient has become convinced that the generic substitute, although technically the same, does not alleviate the problem that the patient believes exists? The problems could increase in the coming years as more people reject the generic substitutes because they have convinced themselves that those drugs will not deal effectively with their problems.
    Mr. Bermingham: My hon. Friend makes a valid point. I hope that we convince the Government that there

    931
    is need for action, for further research and for more self-help groups to wean people off the drugs. We also need a revision in medical practice to avoid the problems to which my hon. Friend refers. I welcome the introduction of generic substitutes, but even they will give rise to addiction and dependency.
    We have all heard of the "smartie" syndrome. One visits the local practitioner and says to him, "I am feeling a bit off." The doctor is often rushed—I accept that that happens—and gives the patient a prescription for a pick-me-up, which may be Valium, Librium or any of the other benzodiazepine drugs.
    The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): I appreciate what the hon. Gentleman is saying, but Valium does not pick one up; it puts one down.
    Mr. Bermingham: I accept the Minister's comment, but the point is that the drugs are designed to get rid of depression. A few weeks later the patient returns to the doctor and his symptoms have not changed. Sometimes he will not even see the doctor, but will pick up a repeat
    932
    prescription from the receptionist. That is not good medical practice. Women's Own magazine, which conducted a large-scale survey on the matter, showed that there were cases of people being prescribed such drugs for as long as 18 years. Who needs medication for 18 years, or even for four years? There are clear signs that an addiction problem has grown.
    I hope that the Government will begin to fund research into the problem and self-help groups. The Minister for Health said recently, in reply to my question, that about £10,000 is spent on self-help groups. That is nowhere near enough. We must do four things: first, stop repeat prescriptions; secondly, enable doctors to have time clinically to treat their patients; thirdly, be on our guard to prevent people being given drugs for long periods; and, fourthly, fund massive research to alleviate the problem.
    11.59 am
    Mr. John Patten: I welcome the contribution made by the hon. Member for St. Helens, South (Mr. Bermingham) to this debate, raised at short notice. I shall write to him on all the points that he has raised.
    Question put and agreed to.
    Adjourned accordingly at 12 noon.

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