Sitting of 23 October 1984

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS
    WARWICK DISTRICT COUNCIL BILL [Lords]
    Read the Third time, and passed, with amendments.

    GREATER LONDON COUNCIL (MONEY) (No. 2) BILL
    Order for consideration read.
    To be considered upon Thursday.

    LONDON DOCKLANDS RAILWAY (No. 2) BILL
    Considered; to be read the Third time.
Oral Answers to Questions
  SOCIAL SERVICES

    Housing Benefits Scheme
    Mr. Pikeasked the Secretary of State for Social Services if he is satisfied that local authorities now have sufficient resources and facilities for dealing with the unified housing benefits scheme.
    The Secretary of State for Social Services (Mr. Norman Fowler): Local authorities have statutory responsibility for administering the housing benefits scheme and it is up to individual authorities to decide what resources of staff, accommodation, computer equipment and so on they need. We are satisfied that the arrangements for subsidising local authorities' administration costs adequately reimburse authorities for all reasonable costs arising from the new scheme and that there is no reason why authorities should not have the resources and facilities that they need.
    Mr. Pike: As the right hon. Gentleman has said in reply to previous questions that his Department undertakes no monitoring, how can he be satisfied that councils have sufficient resources to do the job, especially when one remembers the financial restraints that have been imposed on them? Is the right hon. Gentleman aware that when the changes were brought into effect many councils had insufficient resources to do the job and that many people will suffer hardship because councils are not able to do the work as speedily as they would wish?
    Mr. Fowler: I do not accept that. Our arrangements for reimbursing local authorities on housing benefit are
    536
    entirely fair to them. The hon. Gentleman made a good point about checking. We shall look at that to see whether we can get a better system to check on what local authorities are spending.
    Mr. McCrindle: Has my right hon. Friend seen reports in various organs of the press suggesting that there is to be a cut in the resources available for housing benefit? As an inquiry into the future of the scheme is taking place, will my right hon. Friend take the opportunity to confirm that there will be no movement one way or the other in the provision of housing benefits at least until the inquiry has been completed?
    Mr. Fowler: The story to which my hon. Friend referred appeared in The Guardian on Saturday and it is wrong. No decision has been taken on housing benefit and I am well aware of the importance of waiting until the independent committee under Mr. Rowe has made its report.
    Mr. Alton: When the scheme was introduced, about 2 million people were an average of 75p a week worse off. Is the right hon. Gentleman aware that there is considerable anxiety in all parts of the House about the possibility of housing benefit being cut further? When is he likely to be able to make a statement on the subject?
    Mr. Fowler: The hon. Gentleman knows that public expenditure is being reviewed and he will have to await the completion of that review. The importance of the review process is well recognised, as is the importance of what the hon. Gentleman said.
    Mr. Andrew Bowden: Is my right hon. Friend aware that we warmly welcome his reply to my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle) that no changes will be made until he has received the report of the inquiry? However, can my right hon. Friend assure me that even when he has received the report there will be no question of placing further burdens on pensioners or retired people?
    Mr. Fowler: I shall not enter into commitments on decisions that have not been taken. I said that The Guardian story was wrong. That is a fact. My hon. Friend will have to await the completion of the public expenditure discussions that are currently taking place.
    Mr. Meacher: In view of the rumours about a public expenditure cuts package, will the Secretary of State categorically deny that the Government are seriously considering further chopping back housing benefit at any stage, reducing unemployment benefit and taxing or means-testing child benefit? Do not those pre-emptive decisions clearly reveal the right hon. Gentleman's reviews to be meaningless charades?
    If there are to be further cuts in housing benefit, will it not be diabolical if pensioners were made to suffer when his Government have already wasted £100 million on the Newcastle computer dispute which, if settled, would save only £46,000 a year?
    Mr. Fowler: The hon. Gentleman has used a pre-prepared supplementary question and has taken absolutely no account of what I have already said. He must be even more foolish than I thought if he thinks that I will give a commitment that at no stage in the future will we study the benefits currently under review. The review process is intended to highlight how we can better provide aid for those in need.

    Mentally-ill Persons (Community Provision)
    Mr. Dubsasked the Secretary of State for Social Services what recent representations he has received about community provision for patients discharged from mental illness hospitals.
    Mr. Fowler: A number of hon. Members and organisations concerned with mental health have written to Ministers on this question.
    Mr. Dubs: Is the right hon. Gentleman aware that there is widespread concern about what happens to the mentally ill when they are discharged into the community? Is he further aware that local authority social services departments simply do not have sufficient money to provide adequate support? Will he study that problem in the light of what the Government are doing to weaken further the resources of local authorities?
    Mr. Fowler: I do not accept the last part of the hon. Gentleman's question, but I certainly accept what he said about the importance of community care. I believe that both parties are committed to that policy, which clearly has financial consequences. We have never regarded community care as a cheap option. It has consequences for personal social services. The hon. Gentleman is wrong to suggest that personal social services spending has been reduced — indeed, during the past five years it has increased by 18 per cent. in real terms.
    Mrs. Kellett-Bowman: I welcome my right hon. Friend's emphasis on the importance of community care. Will he stress the importance of closing the very large Victorian-built mental hospitals, which are almost impossible to modernise? However devoted the staff, it cannot be in the interests of patients for them to remain in such hospitals.
    Mr. Fowler: I agree with my hon. Friend. There is a clear need for hospitals and for the continuation of hospital care. However, no one wants to continue unsatisfactory and inadequate treatment in those surroundings.
    Mr. Kennedy: As the right hon. Gentleman has said that he will study the problem and take into account the concern expressed, will he especially consider the position of local authorities and the effect that the potential rate-capping programme will have on the encouragement of joint funding projects? Are not those projects of exactly the sort that are relevant to the community care programmes?
    Mr. Fowler: The hon. Gentleman is in error to suggest that restrictions on local authority spending fall upon specific projects—they fall upon general spending. Joint financing is continuing to develop.
    Ms. Harman: Is it not true that buildings and services for the care of patients previously in institutions are simply not developing? Is that not for two reasons: first, that regional health authorities are not handing over the necessary finance; and, secondly, that social services departments cannot take up additional spending commitments because of rate penalties?
    Should not the right hon. Gentleman do two things? First, should he not have a positive plan, backed by a circular to regional health authorities; and, secondly, give an absolute guarantee that any increased spending by social services departments as a consequence of bringing people into the community is 100 per cent. disregarded?
    Mr. Fowler: The fault in the hon. Lady's supplementary question is the suggestion that joint finance is in some way not being taken up. This year, allocation of joint finance money is about £100 million, and there is no evidence that that is not being taken up by local authorities. In addition, the personal social services budget has increased, as has the money made available for care in the community. Obviously, we regard this matter as a priority. I hope that there will be as much agreement as possible between both sides of the House on the importance of this matter.

    Civil Defence
    Mr. Wolfsonasked the Secretary of State for Social Services whether his officials have had any meetings with the British Medical Association to discuss civil defence planning.
    Mr. Neil Thorneasked the Secretary of State for Social Services whether he is preparing a new circular on civil defence to replace HDC(77)1.
    The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): A preliminary draft to replace circular HDC(77)1, which contains the existing guidance to health authorities on civil defence planning, was sent to the British Medical Association on 30 July 1984 with an offer of meetings wth officials to facilitate the association's internal discussions. We are awaiting a further response.
    Mr. Wolfson: I thank my hon. Friend. Would he care to enlarge on that answer and explain what he aims to achieve in those discussions?
    Mr. Patten: We hope to have the active co-operation of both the BMA and the Royal College of Nursing in planning for the care of casualties after a conventional or, indeed, a nuclear attack on this country.
    Mr. Thorne: I am sure my hon. Friend is aware that a number of area health authorities are anxious to get their hands on the documents. Will he do all that he possibly can to expedite the matter by putting pressure on the bodies currently being consulted?
    Mr. Patten: I appreciate my hon. Friend's interest as chairman of the National Council for Civil Defence. We shall circulate the draft guidance to local health authorities for consultation as soon as we are in a position to do so, but at a meeting last October I pledged, with the then Minister of State, Home Office, now my right hon. Friend the Secretary of State for Northern Ireland, that we would give the BMA and the Royal College of Nursing a first look.
    Mr. Strang: Do the Government now accept the assumptions as to the likely number of casualties arising from a nuclear attack which are contained in the BMA's historic report on the medical effects of nuclear war, a report which concluded that the entire National Health Service could not cope with the dropping of a single 1 megaton bomb on a British city?
    Mr. Patten: At its own request, the BMA is constructively considering its advice to us on these issues. We are awaiting that advice and hope to have it shortly.
    Mr. Meacher: On the point raised by my hon. Friend the Member for Edinburgh, East (Mr. Strang), as a World

    539
    Health Organisation study recently revealed that no health service in the world could deal with the casualties arising from a single 1 megaton nuclear bomb, and as most experts believe that a nuclear exchange would be in the range of 200 megaton, is not medical expenditure on civil defence at best a cruel deception and at worst a sick joke? If that is not so, how do the Government justify spending £20 million on building deep shelters for regional and central Government personnel while in "Protect and Survive" they tell the rest of us to whitewash our windows and wrap jackets around our heads?
    Mr. Patten: I do not agree with the hon. Gentleman's comments. They are a classic case of the kind of remark made before the event which prefaces the kind of complaint that will be made after the event if we have not taken the necessary precautions. It is incumbent on the Government of this country to take every reasonable precaution to deal with the aftermath of both conventional and nuclear attack, exactly as the Labour Government did in 1977.
    Lord James Douglas-Hamiltonasked the Secretary of State for Social Services what help he is able to give to the voluntary aid societies for medical training to meet their civil defence role.
    Sir Anthony Kershawasked the Secretary of State for Social Services what training aids and publications are available from his Department for medical training of voluntary aid societies personnel in their civil defence role.
    Mr. John Patten: Under the provisions of section 64 of the Health Services and Public Health Act 1968, grants of £10,000 per year are being made towards the administrative costs in respect of their civil defence role of both the British Red Cross Society and the Order of St. John. There is no question of the volunteer members of these organisations being involved in the provision of definitive medical treatment. The training aids and publications on first aid produced by the voluntary aid societies themselves provide all that is required to supplement the high standard of practical training that they give.
    Lord James Douglas-Hamilton: As many first aid posts are the responsibility of area health authorities or boards, does my hon. Friend agree that training funds might be forthcoming from his Department as well as from the Home Office?
    Mr. Patten: At present my right hon. Friend the Secretary of State does not have the statutory power to make such funds available. None the less, there is close co-operation between the voluntary aid societies and district and regional health authorities, and considerable help is given with training at that level.
    Sir Anthony Kershaw: Is there not a need for paramedical guidance for civil defence volunteers to enable them to deal not only with the problems of radiation sickness but with long-term problems such as the shortage of drugs, equipment and expertise?
    Mr. Patten: It is just such issues that will be addressed in the circular that was the subject of the previous question.
    Mrs. Clwyd: Has the Secretary of State considered issuing suicide pills to the emergency services, as the Government's own studies show that, after a nuclear attack, there will be millions of untended dying?
    Mr. Patten: No, Sir.
    Mr. Skinner: Will the Minister take on Mr. MacGregor to give advice on the treatment of victims, as he seems to be an expert in putting a plastic bag over his head?
    Mr. Patten: No, Mr. Speaker. As always, I look to my right hon. Friend the Secretary of State to take the lead on such important issues.

    Falklands Airport (Injured Persons)
    Mr. Dalyellasked the Secretary of State for the Social Services how many people injured on the airport building site on the Falklands have been treated at National Health Service hospitals.
    The Minister for Health (Mr. Kenneth Clarke): None.
    Mr. Dalyell: How long can a situation last in which those who have burns and other complex injuries find that their nearest hospital is 8,000 miles away in the northern hemisphere?
    Mr. Clarke: That is not the case. A general practitioner and nursing staff are available in the Falklands to deal with people who have injuries. The more serious cases are brought back to this country. No one has had to attend an NHS hospital. So far as I am aware, no one has been short of the necessary treatment. To all those taking an objective view of the situation, that is the most important thing.

    Dreadnought Seamen's Hospital, Greenwich
    Mr. Barnettasked the Secretary of State for Social Services if he will make a statement about the future of the Dreadnought seamen's hospital in Greenwich.
    Mr. Kenneth Clarke: Greenwich health authority will discuss at its meeting on 13 November the issue of a consultation document which proposes transferring the Dreadnought's services for seafarers from Greenwich to St. Thomas's hospital and absorbing services for local patients in other hospitals in Greenwich.
    Mr. Barnett: Is the Minister aware that, according to the Price Waterhouse report published in February, such a transfer could well mean that the services that are specially provided for seamen by the seamen's hospital would become more expensive?
    Mr. Clarke: I look forward to seeing that document if the proposal goes ahead in due course and comes before Ministers to be resolved. Greenwich is acting on the basis that it could save £700,000 for its own patient services by the proposed change, and the maritime board is anxious that the seamen's hospital should be moved to a new specialised unit in St. Thomas's.

    Supplementary Benefit Claimants
    Mr. Jannerasked the Secretary of State for Social Services whether he will take steps to improve the service available to those claimants who do not receive their supplementary benefit Girocheques on time.
    The Minister of State, Department of Health and Social Security (Mr. Tony Newton): In general, the system of payment of supplementary benefit by Girocheque works well. We recognise, however, that there are problems from time to time, as occurred recently following the derailment of a train carrying mail to the hon. and learned Member's constituency. As he knows, steps have been taken locally to improve arrangements for dealing with such contingencies.
    Mr. Janner: Is the Minister not aware that the only arrangement that could do any good in the long run would be to make good the cuts in staffing at DHSS offices in my constituency and elsewhere? Is he aware that there will inevitably be even greater delays after 26 November when there is to be an increase in supplementary benefit which cannot conceivably be implemented in Leicester because of the mammoth task that awaits a thoroughly depleted staff?
    Mr. Newton: I shall answer the hon. and learned Gentleman's second point first. Our understanding is that in general the uprating will be carried out on time, thanks to the loyal work of staff throughout the system who are working despite the problems at Newcastle. If the hon. and learned Gentleman is worried about what will happen in Leicester, he should talk to the strikers in Newcastle and ask them what they propose to do about the situation.
    Mr. Janner: The Minister should talk to them.
    Mr. Newton: It is no use Labour Members running away from the fact that one of the objectives of the strikers in Newcastle is to prevent the uprating being paid on time.
    In reply to the hon. Gentleman's first point, the problem of emergency services has little, if anything, to do with staffing, but we accept that there are problems and we are seeking to make improvements.
    Mr. Couchman: Is my hon. Friend aware that his Department is paying out large sums of money to meet mortgage interest payments that are due from striking miners, that that money is being suborned to pay other bills, and that mortgage interest is not being paid? Is he satisfied with that?
    Mr. Newton: We are aware of my hon. Friend's point and are not satisfied with it. We are considering what our stance should be in the light of the evidence that is emerging.
    Mr. Meadowcroft: Is the Minister aware that there is evidence of claimants doing without essentials in the days before a Girocheque arrives? Is that problem not greatly exacerbated when cheques do not arrive? Is it possible to give a post office that pays out claimants the authority to make emergency payments?
    Mr. Newton: I do not think that it would be practicable for the Post Office to act in that way. Post offices tend to close at mid-day on Saturday. That does not help. We hope to be able to improve our home telephone service, which we are studying. Social services departments have power to make emergency payments without reference to us.
    Mr. Ottaway: As a result of the strike at Newcastle offices, delays are also being experienced at post offices and, as a result, pensioners are having to queue outside in the cold. With the onset of winter, will my hon. Friend please consider setting up some form of distribution centre so that pensioners do not have to queue outside in bad weather?
    Mr. Newton: I acknowledge the problem that my hon. Friend has raised. He will know that the Post Office has already taken action to ameliorate the problem that is considering further action. We shall do anything that we can to help.
    Mrs. Beckett: Does the Minister agree that although it is good for him to recommend to my hon. and learned Friend the Member for Leicester, West (Mr. Janner) that he talks to the strikers in Newcastle, it would be much better if he and the Secretary of State talked to those strikers and recognised that, in this dispute, as in others, the Government are spending vast sums of public money to achieve a small gain that will now not be recovered for several hundred years? Does he recognise that the wholly arbitrary cuts in staff numbers in the Civil Service, the DHSS and elsewhere have led directly to the problem that my hon. and learned Friend identified? Will he assure us that, in the current review, an opportunity will be taken to improve rather than to worsen the service?
    Mr. Newton: I do not accept that any policies which the Government have adopted on staffing, which have been matched by cuts in work load, have contributed to the problem to which the hon. and learned Member for Leicester, West (Mr. Janner) drew attention. With regard to Newcastle, Ministers and management in the Department have made it clear throughout the dispute that we are willing to talk. The problem is that we have been faced with unions which have been unwilling to talk constructively with us.

    Greater London (Health Services)
    Mr. Tony Banksasked the Secretary of State for Social Services whether he is satisfied with the level and quality of health service provision in Greater London.
    Mr. Kenneth Clarke: Health authorities in London face the difficult challenge of adjusting their services to match the movement of population in recent years. Some districts, particularly in inner London, need to reorganise acute provision to free resources for development of local services for the elderly, the mentally ill, the mentally handicapped and to improve primary care.
    Mr. Banks: Is that not a way of saying that, in London, we must make serious health service cuts? Did not hospital waiting lists in London increase between September last year and March this year? During the past two years the four Thames regions have suffered cuts and are to suffer more in the next two years to the tune of more than £22 million. Is not the Minister being complacent about the situation in London?
    Mr. Clarke: The hon. Gentleman has skilfully selected his dates and figures. Spending in the Thames regions has more than kept pace with inflation since we have been in office, although regions are planning some reductions in inner London districts. The problem is that the population has moved away. There is a clear surplus of acute beds in

    543
    inner London as reports to the Labour Government and to us have shown. We must move resources to where the population is—in the suburbs and home counties—and develop services of which inner London is short. London has 15 per cent. of the country's population and gets 20 per cent. of health spending. It does not always spend that money in the best interests of its inhabitants. There must be much change to get the type of service that we require.
    Mr. Sims: Does my right hon. and learned Friend agree that there is scope for making more funds available for direct health care by contracting out ancillary services, as Bromley health authority does with its catering service?
    Mr. Clarke: Bromley authority has made spectacular savings on its catering service, all of which are devoted to patient care. Hammersmith hospital is saving more than £500,000 on changes to its ancillary services, all of which is available for patient care. I wish that the hon. Member for Newham, North-West (Mr. Banks) would put pressure on his political friends to stop them choosing to spend money on keeping up the cost of cleaning and instead to spend it on developing patient care.
    Mr. Pavitt: Will the Minister call for papers from his Department to show the large number of Departments that are being consulted either about closing or transferring in the London region and take his personal time to examine them? Does he recognise that much of the savings envisaged for 1984–85 will cause double the amount of expenditure during the following five years?
    Mr. Clarke: At our request all the regions are drawing up strategies for the next 10 years. I should have thought that that was invaluable for knowing where we were going and for making well-judged decisions for future health services in London. The disputed cases will eventually come to Ministers for a decision. We shall not approve those which fail to make financial sense. Most important, we shall not approve any which do not result in an improved service to patients either through the facilities of a more modern unit or by releasing resources whose value can be better realised elsewhere.
    Mrs. Rumbold: I take comfort from my right hon. and learned Friend's response to the question in so far as he relates the moving of resources from inner London areas to suburban areas. Will he confirm that he will give kind approval to those schemes which involve certain health services and voluntary and community services?
    Mr. Clarke: I am grateful for my hon. Friend's comments. It makes sense to plan for the future of health services on the basis of where the population now live rather than to retain surplus provision of acute accommodation where the population used to live—in the teeming slums of inner London, before we began to make happy progress clearing them. The voluntary and community services must also be involved. We need to improve joint planning for the future between health authorities, local authorities and voluntary and community bodies.
    Mr. Dobson: Does the Minister accept that people living in Greater London who want an operation are sick to death of him talking about plans for the future? They want plans for the present, to reduce hospital waiting lists in Greater London. Will he confirm what my hon. Friend the Member for Newham, North-West (Mr. Banks) said, which is that hospital waiting lists have increased during
    544
    the last six months for which there are records? Does he accept that in the Bloomsbury health district the number of people awaiting operations has increased by 2,000 during that period so that 12,000 people are waiting? Does he accept that in Hackney there are now 1,100 people who have been waiting for urgent operations for more than a month? Despite that, he still proposes to shift resources from those areas and thus cause an extension of hospital waiting lists.
    Mr. Clarke: As I said the hon. Member for Newham, North-West was doing, the hon. Gentleman is making a careful selection of dates for his figures. Throughout the country the underlying trend is that the number of people on hospital waiting lists is steadily decreasing and the numbers of those being treated in hospital is increasing. The hon. Gentleman's comments about how authorities cope with these problems in Greater London must be set alongside the needs of other parts of the country where people are also on waiting lists and where services are provided from far lower resources per head than is the case in inner London.

    Mental Health Act 1983
    Mr. Proctorasked the Secretary of State for Social Services if he will make a statement on the implementation of the Mental Health Act 1983.
    Mr. Kenneth Clarke: Implementation of the Mental Health Act is continuing in a satisfactory manner. Sections 35, 36 and 38 of the Act, which provide for remands by criminal courts to hospital for assessment and interim hospital orders, were implemented on 1 October 1984.
    Mr. Proctor: Regarding sections 35, 36 and 38 of the Act, will my right hon. and learned Friend tell the House how many representations he received from regional health authorities and the nature of the responses to the consultative document which his Department circulated in March?
    Mr. Clarke: We consulted all the regional health authorities on the proposal to increase the powers available to the courts when dealing with offenders who might be mentally ill. Nine of the health authorities were in favour of our going ahead, but the other five had reservations, especially about their ability to provide the service in their regions and its resource implications. Ministers were anxious to get on with that part of the Act because we believe that the mentally ill should be treated in hospital wherever possible and we do not wish the courts to have to send sick people to prison. Therefore, we brought the proposals into effect and the courts must accept that the ability to provide the service will vary across the country. However, all regions must continue to try to provide the facilities required.

    Five-day Hospital Beds
    Mr. Dobsonasked the Secretary of State for Social Services whether he is satisfied that the operation of five-day hospital beds is fair to people who live alone.
    Mr. John Patten: The use of five-day wards, and indeed of other types of short-stay wards including day beds, can lead to an increase in the number of patients treated. However, such patients need careful selection, taking account not only of the probable length of stay but of the availability of adequate care afterwards.
    Mr. Dobson: Does the Minister accept that on the evidence of a leaflet prepared for five-day hospital stay patients at Charing Cross hospital they are being told that if they cannot make their own transport arrangements and provide food for themselves at weekends they can go to the end of the list? Does that not mean that many of the most deprived people in society are being ruled out of obtaining access to five-day beds at a time when, as in Hammersmith, there are reductions in the number of home helps, meals on wheels services and health visitors? Will that not be exacerbated by rate-capping and by constant pressure from the Government to reduce the provision of the services that would make the use of five-day beds reasonable for the worse off?
    Mr. Patten: The hon. Gentleman suggests that the use of five-day beds is not being helped by the way in which clinical practice is carried out. I have not seen the leaflet to which he referred and he did not send it to me beforehand. All I can say is that all guidance that goes from my Department to clinicians stresses that they must consult general practitioners and primary health teams before they decide whether a patient is suitable for five-day or shorter treatment in hospitals.
    Mr. Heddle: Does my hon. Friend agree that better utilisation of five-day beds for patients who live alone and others could take place if hospital waiting lists were computerised? Will he take this opportunity to confirm to the House his Department's commitment at least to carrying out a pilot study on the computerisation of hospital waiting lists, and to confirm that the West Midlands regional health authority has instructions from his Department to carry out such a pilot study?
    Mr. Patten: I am thoroughly in favour of such a pilot study. We have offered some money to the West Midlands regional health authority so that it can carry out a valuable study of the bed bank idea, which my hon. Friend has to a large extent pioneered. Somewhat surprisingly for a regional health authority, having been offered money, it is going rather slowly with the project. I wish that the authority would get on with it.
    Mr. Meadowcroft: Does the Minister accept that one problem with five-day hospital beds is the occasional need for emergency readmission? What guidelines has he given to clinicians to cope with that problem?
    Mr. Patten: Clinicians have every opportunity to enable them to allow emergency readmission. About 50 per cent. of all patients in NHS hospitals come in immediately on emergency admission procedures, and I have no evidence to suggest that anyone who needs emergency treatment is not so treated immediately.

    NHS Staff
    Mr. Yeoasked the Secretary of State for Social Services what is the total number of medical and non-medical staff employed in the National Health Service at the last available date.
    Mr. Fowler: There were 819,100 whole time equivalent medical and non-medical directly employed staff in the NHS in England at 31 March, the latest date for which a total figure is available.
    Mr. Yeo: Does my right hon. Friend agree that increasing the proportion of medical and non-medical staff
    546
    in a useful way of ensuring that the maximum share of Health Service resources is devoted to patient care? Will he take whatever steps he can to ensure that the ratio continues to increase?
    Mr. Fowler: Yes, Sir, and for the past 12 months that has taken place. Although there has been a reduction in support staff, there has been an increase of about 1,200 in the number of doctors employed in the National Health Service.
    Mrs. Jill Knight: In this connection, can my right hon. Friend give us any information about the progress in the implementation of the Griffiths staffing report? Can he confirm that although some junior appointments have been made, key posts have not yet been filled?
    Mr. Fowler: Many key posts are being filled, and the key posts at regional level are being filled now. We shall then go on to general managers at the district and unit levels. What we are waiting for—I hope that we can make an announcement on it reasonably soon—is the appointment of a general manager at the centre of the DHSS.

    Oral Contraceptives
    Mr. Greenwayasked the Secretary of State for Social Services what representations he has received from the British Medical Association about the prescription of oral contraceptives to girls below the age of 16 years; what reply he has sent; and if he will make a statement.
    Mr. Kenneth Clarke: The British Medical Association has drawn my attention to its policy statement in support of our current guidance on family planning services for young people. In reply I said we would consider this guidance again when the outcome of the legal action of which it is currently the subject is known.
    Mr. Greenway: Is my right hon. and learned Friend aware of the widespread public concern over the right of doctors to prescribe oral contraceptives to girls under 16 at a time when it is vital to strengthen the family unit?
    Mr. Clarke: I am aware of widespread concern and widely differing views. The guidance from the BMA, our Department and the General Medical Council stresses the need to try to involve parents wherever possible, and doctors often succeed in doing so. At present we say that if they cannot, what happens next should depend on what the doctor judges to be best in the interests of the girl. Mrs. Gillick claims that this is illegal and we have undertaken to review the whole question again once we have received the final decision of the court.
    Dr. M. S. Miller: Bearing in mind the cost and necessity, if possible, to involve parents, does the right hon. and learned Gentleman accept that the primary consideration is the confidential aspect between patient and doctor?
    Mr. Clarke: A number of important issues are raised, such as the confidentiality of the relationship between a 15-year-old and a doctor, the ability of a 15-year-old to give valid consent to treatment and whether she is sufficiently mature to give such consent. Obviously we shall have to bear all these matters in mind when we review this policy.

    Hospital Waiting Lists
    Mr. Corbynasked the Secretary of State for Social Services what is the total number of people on the waiting list for National Health Service operations and how many usable beds are temporarily out of use.
    Mr. John Patten: On 31 March 1984 there were 666,327 people awaiting admission to surgical specialties in NHS hospitals in England. Information on numbers of beds temporarily out of use is not collected routinely.
    Mr. Corbyn: Should not the Minister be able to give more accurate and up-to-date information on this scandalous waste of resources?
    Mr. Patten: For someone who could not remember the number of his question, that is ripe. We give very up-do-date and accurate information to the House, which shows that a record number of inpatients, outpatients and day patients are being treated by the NHS.

    NHS Finance
    Mr. Nellistasked the Secretary of State for Social Services if he will make a statement on the financing of the National Health Service.
    Mr. Kenneth Clarke: Between 1978–79 and 1983–84 we doubled expenditure on the Health Service. Spending will increase this year by £1 billion to a record £16½ billion. These extra resources together with greater efficiency stemming from our management initiatives will enable the NHS to expand and build upon the substantial gains we have already made. Since we took office provision has increased to the extent that hospitals in England alone treated 900,000 more inpatient and day cases and had 2½ million more outpatient attendances in 1983 than in 1978.
    Mr. Nellist: Will the Government consider a change in current NHS policy so that cervical cytology can be provided by general practitioners to women under the age of 35? In addition, will they give extra financial resources to Coventry city council to enable workplace screening for breast cancer to take place for women under 35?
    Mr. Clarke: I congratulate the hon. Gentleman on his wisdom in moving away from the substance of his original question, the reply to which reveals how much more we are spending and how many more patients we are treating than did the Labour Government. We take screening for cervical cancer extremely seriously and at present there is nothing at all to prevent a general practitioner from providing a screen for a younger woman. We do not provide a special additional item-of-service fee for that, but concentrate that fee on priority groups — older women and those who have had a number of pregnancies. We expect GPs to provide a wide range of services to their patients but do not expect to provide a special item-of-service fee for every item.
    Mr. Latham: When he is making financing decisions, will my right hon. and learned Friend tell regional health authorities to get away from the idea that all babies must be born in district general hospitals, and that they should put proper support behind rural maternity units?
    Mr. Clarke: There is often a conflict between the medical opinion of consultants, who, rightly or wrongly feel that it is safer for a mother to have her baby in a large
    548
    district general hospital, and the preference of would-be parents for local, much-loved traditional hospitals. Often, the conflicts come to Ministers for decisions, and we have to decide each one on its merits, weighing up the respective claims on both sides.

  PRIME MINISTER

    Engagements
    Mr. Wareingasked the Prime Minister if she will list her official engagements for Tuesday 23 October.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. I was present at Victoria to meet President Mitterrand on his arrival for a state visit. In addition to my duties in the House I shall be having further meetings later today. This evening I hope to attend a state banquet in honour of President Mitterrand at Buckingham Palace.
    Mr. Wareing: When will the Prime Minister stop sacrificing the poor and the aged on the altar of her Government's dinosaurian economic policies? [Interruption.]
    Mr. Speaker: Order. I appeal to the House to allow the hon. Gentleman to finish his question. Such interruptions take time out of Question Time.
    Mr. Wareing: Has the right hon. Lady just one grain of compassion for those old people who are threatened with death through hypothermia this winter? If she has, will she review her Government's policy of increasing the heating allowance but cutting the real value of that allowance, so that far more people suffer as a direct result of her Government's half-baked policies?
    The Prime Minister: As the hon. Gentleman has just heard in social security and health questions, in the Health Service more day patients and inpatients are being treated than ever before, while the retirement pension has gone up in real terms, as have supplementary benefit and benefits for the sick and disabled. As to the hon. Gentleman's specific point about heating, the sum now spent on heating is £400 million. The amount has gone up by far more than inflation and is far greater than it was during the time of the last Labour Government.
    Mr. Lyell: Bearing in mind that, of the three questions put to members of the National Association of Colliery Overmen, Deputies and Shotfirers' in the September ballot, question three on the crossing of picket lines has been conceded in full, question two on conciliation procedures has been fully met and question one on pit closures is covered by the offer by the Coal Board to give full weight to the independent arbitration procedure, what possible grounds are there for NACODS entering its members on a full-scale strike?
    The Prime Minister: I agree with my hon. and learned Friend. The strike by the NACODS members will do great damage to jobs and the economy. NACODS is negotiating with the Advisory, Conciliation and Arbitration Service and the NCB and it is to be hoped that those negotiations will result in a settlement acceptable to NACODS and the NCB.
    Mr. Kinnock: I congratulate the right hon. Lady on her escape from injury in the horror at Brighton. I also express our warm wish that her injured colleagues will continue to make a good recovery.
    After 33 weeks of the coal mining dispute, we again ask the Government to make a constructive intervention to try to secure a satisfactory outcome to this dispute. Will the Prime Minister now give specific answers to the specific questions that I raised with her last week? First, are the proposals for the loss of 4 million tonnes of productive capacity now withdrawn?
    Secondly, will the Government, as one of the parties to the "Plan for Coal", support the return of the colliery review procedure under that plan? May I please have specific answers to those specific and straightforward questions?
    The Prime Minister: I thank the right hon. Gentleman for the kind words at the beginning of his question. I shall pass on his good wishes to those who are still in hospital. I am sure that they will be very pleased with what the right hon. Gentleman said.
    The right hon. Gentleman wrote a letter to me on the two specific points. I tried to answer them in full. He will recall that, in the debate that we had just before the House adjourned, the question of colliery procedures arose. It was agreed between both sides of the House that uneconomic pits had always been closed. [Interruption.] The debate then resolved itself into an issue of colliery closure procedures.
    On 1 August the National Coal Board issued a statement pointing out that the colliery review procedures were as they had always been, and gave the results of those review procedures. Those review procedures are the same as they have always been since the beginning. [Interruption.] There is only one proposed change. That was proposed by ACAS during the last round of negotiations. It was an improvement and it was accepted by the NCB. Otherwise the colliery review procedures have not changed.
    With regard to the proposals of 6 March, as I pointed out to the right hon. Gentleman, it was agreed in some of the talks between the National Coal Board and the National Union of Mineworkers—and published in the middle of July—that
    "in the light of the changed circumstances the Board will revise the March 6 proposals and re-examine those proposals for individual areas, taking account of the changes that have occurred in the needs of the market and the loss of output resulting from the dispute".
    It seems to me, therefore, that I have fully answered the right hon. Gentleman.
    Mr. Kinnock: I read what the Prime Minister said in the letter that she was kind enough to send to me last Friday, and I have listened to her again this afternoon. It appears that she does not yet comprehend the need—as Mr. MacGregor has previously said—to be specific.
    With regard to the June and July propositions for revision of the productive capacity figures, it is necessary to speak not of revision or re-examination in the light of the loss of 54 million tonnes of coal in the weeks of dispute but to say whether the proposition relating to the cut in capacity is now withdrawn. I hope that the right Lady understands the need to be specific.
    Will the right hon. Lady understand that it is necessary to emphasise that the return to the review procedure must
    550
    be in line with "Plan for Coal"? Otherwise it is nothing more than an arbitrary formula for shutdown, which is what was rejected at the beginning of the dispute.
    The Prime Minister: I am sure that the right hon. Gentleman has been through the National Coal Board proposals of 6 March. They were proposals to bring the capacity of the whole industry into line with the continuing demand for coal in the most cost-effective way possible. Because of the length of time that the strike had taken, in July the National Coal Board made the undertaking that I have mentioned. There was no hit-list in the 6 March proposals. [Interruption.] Will the right hon. Gentleman tell me in what paragraph of those proposals that hit-list appeared? [Interruption.] Those proposals were to bring the capacity of the whole industry into line with the continuing demand for coal in the most cost-effective way possible. The colliery review procedures are as they have always been.
    The right hon. Gentleman is well aware that "Plan for Coal" was accepted in the terms of the associated documents. Those documents have been honoured by the Government; indeed, they have been more than honoured in regard to investment. The part that has not been fully honoured is that dealing with the increase in productivity, which should have been some 4 per cent. per annum. It has been only 4·7 per cent. over the 10 years as a whole. As the right hon. Gentleman will be aware, the number of closures has been less than was forecast in "Plan for Coal".
    Mr. Kinnock: I regret having to come back, but this is obviously a central issue, and the Government's reluctance to be constructively involved in promoting a settlement is still causing problems. So much has changed as a consequence of the dispute that speeches that the Prime Minister could have made seven months ago are now no longer relevant. Further, the proposition of March this year for the cutback of 4 million tonnes and the announcement on 23 March by the NCB of the loss of 20,000 jobs directly constitute a hit list. Until the right hon. Lady realises that this is the case it is difficult to see how progress can be made.
    The Prime Minister: No, Sir. I repeat that the proposals of 6 March were to bring capacity into line with demand in the most cost-effective way. All the proposals for colliery closures go through the colliery review procedures, as they have since 1973. Since 1973 it has been accepted that heavy losses at pits were grounds for making closures. The procedures have not changed; the only proposed change in procedures is an improvement which ACAS proposed and the NCB accepted.
    Mr. John Huntasked the Prime Minister if she will list her official engagements for Tuesday 23 October.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Hunt: Still on the miners' dispute, will my right hon. Friend continue to ram home the fact that, in terms of wages, investment, redundancy payments and closure procedures, the miners are getting a better deal under this Government than under any previous Administration, Labour or Conservative, and guaranteed work?
    The Prime Minister: My hon. Friend is absolutely right. On pay the offer to the miners exceeds anything that was ever offered to them under the Labour Government. It means that they would be 25 per cent. above the level

    551
    of average male industrial earnings compared with 18 per cent. under Labour. Investment has exceeded all expectations. It is £650 million more than was expected under "Plan for Coal". The colliery review procedure remains as it is. There is a guarantee that no one shall be compulsorily redundant. I should like to give one example of voluntary redundancy pay. At the age of 49, someone who had been in the coal industry for many years would have got about £1,700 redundancy pay under Labour and would get £33,000 under the Conservative Government.
    Mr. Steel: Will the Prime Minister discuss with President Mitterrand the French Government's newly announced policy of offering every school leaver a place in higher education, a place in industrial training or a job? As both France and Germany can do that, why cannot the right hon. Lady do the same instead of offering our teenagers places on the dole queue?
    The Prime Minister: As the right hon. Gentleman is well aware, every school leaver of the age of 16 was guaranteed a place on the youth training scheme by Christmas if he left school the previous summer. In fact, that was fully met and, indeed, there were spare places. That guarantee will be fully met again this year. Therefore, young people can have the option either of staying on in education until the age of 18 or going into the YTS, with a number of them still going into work. We really hope to reach the position where it is not an option to be unemployed. Young people can already stay on in education.
    Mr. Heddleasked the Prime Minister if she will list her official engagements for Tuesday 23 October.
    The Prime Minister: I refer my hon. Friend to the reply that I gove some moments ago.
    Mr. Heddle: Will my right hon. Friend take time today to deplore publicly the long-running strike at the Department of Health and Social Security computer centre in Newcastle? Is that not an example of how strikes inspired by Left-wing militancy hit hardest the pensioners in all right hon. and hon. Members' constituencies? Is it not one further example of how strikes of this nature hit the most vulnerable members of our community?
    The Prime Minister: That strike appears to be designed to prevent the uprating of pensions due in November and to prevent the uprating of child benefit. It is therefore deliberately aimed at both the old and young in our community in a disgraceful way.
    Fortunately, my right hon. Friend and the administration at Newcastle and elsewhere in the offices are determined that the upratings will go ahead. It is because of the loyalty of many, many people working for the service that pensioners will get their upratings and that others will get their child benefits. It is nothing to do with those 400 who callously have gone on strike.
    Mr. Blairasked the Prime Minister if she will list her official engagements for Tuesday 23 October.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Blair: Is not the Chancellor of the Exchequer's statement at the weekend that unemployment is not an economic problem but only a human or social one the most humiliating confession of failure? Does the Prime Minister stand by that confession? If she does, how does she square that with her endorsement at her party conference of the 1944 employment White Paper, which puts the battle for jobs at the heart of economic policy?
    The Prime Minister: Unemployment is both an economic and social problem, of course. One cannot possibly argue against that. If the hon. Gentleman were fully familiar with the 1944 White Paper on employment I am sure he would agree that it has a great deal in common with the policies that the Government are pursuing — [Interruption.] I have a copy in my handbag. He must know the White Paper. It is indeed very old. — [Interruption.] It points out right at the beginning:
    "But the success of the policy outlined in this Paper will ultimately depend on the understanding and support of the community as a whole — and especially on the efforts of employers and workers in industry; for without a rising standard of industrial efficiency we cannot achieve a high level of employment combined with a rising standard of living."

Inner London Education Authority (Elections)
3.32 pm
The Secretary of State for Education and Science (Sir Keith Joseph): With permission, Mr. Speaker, I wish to make a statement about the timing of the first direct elections to the new inner London education authority.
The Government announced earlier this year that in the light of the consultations which they had carried out they had decided that the new ILEA to be formed on the abolition of the Greater London council should be directly elected. During the passage through Parliament of the Local Government (Interim Provisions) Act 1984, it was also decided that the term of office of the existing GLC members — from whom the bulk of the ILEA membership is drawn—should be extended from May 1985, when elections would have been due, to April 1986, the proposed date of abolition. We have been considering how best to secure continuity for the administration of education in inner London through the transition.
The Government have concluded that the first direct elections to the authority which will succeed ILEA should be held in May 1986 to coincide with the London borough elections. We propose that the new corporate body which is to take over the functions of ILEA from 1 April 1986 should be established, like the new joint boards, in September 1985 in order to prepare the budget and fix the precept for 1986–87 and make other necessary preparations.
From its establishment until the elections in May 1986, the new body would be composed of the present members of ILEA — who will, of course, also continue to constitute the existing authority as a special committee of the GLC until 1 April 1986. Later elections would also coincide with those for the borough councils.
Unlike other services for which the GLC has a responsibility, the functions exercised by ILEA will be exercised by a single directly elected body. The new authority will differ from the existing ILEA only in the method by which it is constituted. In these circumstances, it is appropriate to place the responsibility for the preparatory work which the new authority will need to undertake on the existing members of ILEA.
This provides the best guarantee for continuity of administration and a smooth transition to the new arrangements and is consistent with the Government's decision to enable GLC members, including those who are members of ILEA, to continue to perform their functions until 1 April 1986.
Mr. Giles Radice: On behalf of my right hon. and hon. Friends, may I say how glad we are to see the Secretary of State at the Dispatch Box? Is the right hon. Gentleman aware that, although we welcome the 1986 elections for ILEA, they should be taking place a year earlier? Does not he accept that what is sauce for the goose is sauce for the gander, and that there should be a democratically elected GLC? Is he aware that the decision to cut £75 million from ILEA's budget in 1985–86 is a bit of educational vandalism and political spite and that it breaks his commitment which I heard him make last summer to London parents to protect their children's education? Does he realise that, according to a recent MORI poll, eight out of 10 Londoners support ILEA's
554
educational spending and the level of rates needed to pay for it, and that we are, therefore, greatly looking forward to the May 1986 ILEA elections?
Sir Keith Joseph: I am grateful to the hon. Gentleman for his kind personal reference.
The abolition of the GLC and the continuation of ILEA in a directly elected form are consistent with Government declared policy, subject to the decisions of the House. We believe that some economy in ILEA's expenditure is compatible with the protection of education for the children of inner London.
Mr. Harry Greenway: Is my right hon. Friend satisfied that the new arrangements for direct elections will subject ILEA's policies and spending to the stark strong scrutiny by the electorate that they deserve? Is he aware that, although it is important to have high staff to pupil ratios in urban areas, ILEA's staffing ratio is very high and some schools cannot spend the capitation imposed on them? I regret to say that, but it is true.
Sir Keith Joseph: We cannot guarantee that a directly elected body will strike a more sensible balance between financial prudence and the needs of education, but we think that it is more likely to do so. Many people will agree with the substance of my hon. Friend's remarks.
Mr. Clement Freud: We welcome the direct elections, which are a tribute to those who fought to retain an element of local democracy. However, does not the Secretary of State accept that elections suggest an element of responsibility and of power over expenditure? In particular, we should like to know who will pay for these elections. That was not mentioned in his statement.
Sir Keith Joseph: Questions about elections are for my right hon. and learned Friend the Home Secretary.
Sir Geoffrey Finsberg: Will my right hon. Friend accept that his statement is welcome and that it is pleasant to hear that the elections will coincide with the borough elections? Will he confirm that those who understand these matters and who serve on ILEA — unlike those Opposition Members who have spoken so far, who do not even come from London—know that £60 million a year could be saved without doing any harm to education in London?
Sir Keith Joseph: I am very grateful to have the support of my hon. Friend, with all his experience of London matters. Many well-informed people would agree with his comments.
Mr. Frank Dobson: Will the Secretary of State explain why the Tory party is frightened of holding ILEA's elections next year, when they were due to be held? Will he confirm that under Thatcher's law—which is what we are faced with—the iron rule will be that, no matter whom the people of inner London elect in May 1986, they will be forced to have a Tory budget under the rate-capping law?
Sir Keith Joseph: It is sensible to hold the elections for ILEA at the same time as the borough council elections to avoid calling out the voters twice. As his right hon. and hon. Friends do habitually, the hon. Member for Holborn and St. Pancras (Mr. Dobson), leaves out of account the ratepayers and the jobs and businesses that depend upon

555
the rates. If the present ILEA rate call continued, yet more jobs would be driven out of London. That is why it is so important to have some restraint on ILEA expenditure.
Mr. Robin Squire: When my right hon. Friend discusses these matters with the Home Secretary, will he bear in mind the example of the New York school board, elected by proportional representation and with a multi-ethnic background? Will he also bear in mind that in London at least that form of election would break the stranglehold by the far Left on the education of our children?
Sir Keith Joseph: I cannot undertake to raise that matter with my right hon. and learned Friend the Home Secretary with the same fervour as my hon. Friend the Member for Hornchurch (Mr. Squire).
Mr. Nigel Spearing: Does the Secretary of State agree that the major customer of the GLC supply service is the inner London education authority? In view of that, and since the supply service gives excellent value to ratepayers in inner London and elsewhere, would it not be sensible for the supplies department's functions to be maintained and taken over by ILEA? Would not that fulfil the Government's financial wishes?
Sir Keith Joseph: I have heard praise for the purchasing effectiveness of that department, but it will be for the interim ILEA to make decisions on such matters.
Mr. Richard Holt: Will the new ILEA comprise people other than those who are elected? Will co-optees be done away with completely, and will that be a forerunner for other education authorities throughout the country?
Sir Keith Joseph: My hon. Friend is right in connection with the elected body itself, but the new ILEA will be subject to the general law which requires an education committee. That education committee will be subject to the normal procedures for the co-opting of members. The holder of my office has to approve the composition of the education committee.
Mr. Alfred Dubs: Does the Secretary of State agree that the present policies of the Labour inner London education authority are overwhelmingly popular? [HON. MEMBERS: "Rubbish."] They are. Surely the Secretary of State must be aware of that, because otherwise the elections would take place sooner.
Is the Secretary of State aware that no elections will hide the fact that his deliberate attempt to cut education expenditure in inner London by £75 million will be seen by the majority in inner London as an attack on the education of our young people?
Sir Keith Joseph: It is surely a sign of flabby budgeting by ILEA that in the last financial year ILEA had an underspend of £24 million. That is about one third of the reduction in expenditure which the Government are asking of ILEA for next year. Between the two years the child population in the area will have fallen still further.
I do not accept that a judgment about ILEA is summed up by what the hon. Member for Battersea (Mr. Dubs) said. The tragedy of ILEA is that, despite the zeal and commitment of most of its teachers and their pioneering work, expenditure is out of proportion to the results achieved for the children.
Mr. Richard Tracey: Is my right hon. Friend aware that inner London ratepayers are annoyed because their local borough rate is inflated by the ILEA precept? Will he consider making the rate demand under the new ILEA direct, thus making a fine distinction?
Sir Keith Joseph: I agree with my hon. Friend. Moreover, the ILEA rate has a direct effect on the number of jobs available to the people of London. The Government will so what they can to ensure that the reality of ILEA's demand on the ratepayers will be brought home to them.
Mr. John Cartwright: If the newly elected ILEA will not be free to carry out the wishes of the people of inner London, as expressed through the ballot box, what will be the point of having a directly elected authority at all?
Sir Keith Joseph: The new ILEA will be free to make its own decisions on how to spend the very large sum of money from ratepayers of which it will dispose.
Mrs. Angela Rumbold: I welcome my right hon. Friend's announcement of direct elections, but how does he think the other 104 education authorities will view the fact that money for ILEA will not be in competition with money for other services administered by local government and, therefore, will not be subject to the same pressure in relation to choice and priorities?
Sir Keith Joseph: I cannot give my hon. Friend a totally satisfactory answer, except to say that some people in the education service will wish that there were a sole source of finance entirely devoted to education.
Mr. Chris Smith: Is the Secretary of State aware that no directly elected body can possibly be truly democratic if the crucial decision about the overall level of spending available to it is taken not by that body but by the Secretary of State for the Environment under his rate-capping proposals? Will the right hon. Gentleman persuade the Secretary of State for the Environment to withdraw his deeply damaging designation of the ILEA as a rate-capped authority and his demand for cuts of £75 million?
Sir Keith Joseph: The hon. Gentleman forgets that local authorities function through powers given by the House which, through its approval—despite divisions—of the rate-capping legislation, is democratic and which controls the spending of some local authorities.
Mr. Tony Marlow: Will my right hon. Friend be kind enough to reassure the hon. Member for Battersea (Mr. Dubs) that, while the cost of primary education in Northamptonshire is half that of ILEA, the standard of primary education in Northamptonshire is somewhat higher and that, therefore, any cut in expenditure in London would probably lead to an increase in standards?
Sir Keith Joseph: I am known for my strict impartiality and fairness on such subjects and I must point out that, difficult though the problems of Northamptonshire are, ILEA faces considerable problems which may justify some increase in spending on education. However, I repeat that the spending on education by ILEA is disproportionate to the results achieved.
Mr. Guy Barnett: Will the right hon. Gentleman use his considerable influence in the Cabinet to remove the financial stranglehold being placed on London and give the elections some reality? The consequence of the freedom that ILEA has enjoyed in the past has been to make it the finest education authority in the world.
Sir Keith Joseph: I am not flattering the hon. Gentleman when I say that he cannot really believe that. The evidence is that the education of children in London, however good the intentions, is just not as good as we would all want.
Mr. Toby Jessel: Who will be in charge of ILEA in the five or six weeks between the abolition of the GLC, which includes most of the members of ILEA, and the new elections to ILEA?
Sir Keith Joseph: The interim ILEA, which will have been constituted from the then existing members of the authority in September 1985.
Mr. Tony Banks: It is widely recognised that the concession of direct elections represented a major defeat for the Government's proposals. At the 1986 elections in Nondon, the Conservative party will be soundly thrashed, and will deserve to be thrashed.
Education is an important service and it has been decided that direct elections should be held for the administration of that service. But London-wide planning, housing, transport and health services are also important services. Will the right hon. Gentleman explain why the Government are not prepared to have direct elections for the administration of other important services across the whole of London?
Sir Keith Joseph: The Government's decision to hold direct elections for the new ILEA was a result of the
558
consultative process that they deliberately carried out. The Government believe that the education service is quite different from other services.
Mr. Jeremy Corbyn: Does the right hon. Gentleman realise that, because of his statement, there will be no London-wide elections until 1986? Is that because his party refused to contest the recent GLC by-elections and is afraid of the defeat that it would face if elections were held next May, as they would be if the original plan for GLC and ILEA elections was carried out?
Has not the right hon. Gentleman denied the people of inner London an opportunity to give their verdict on the £75 million cut that he is trying to impose on the ILEA?
Sir Keith Joseph: The answer is no. The decision by the Conservative party not to contest the recent by-elections was a proper reaction to their stunt character.
Mr. Radice: Is the right hon. Gentleman aware that he will not receive support from any Conservative Member of Parliament serving an ILEA authority—other than, of course, from my Member of Parliament, who has characteristically shown himself to be out of touch with the views of his constituents? Is it not clear that those Conservative Members are fearful of what might happen at the 1986 elections?
Is the right hon. Gentleman aware that he has wholly failed to make a case this afternoon for cutting the ILEA budget by £75 million? Has he not reneged on his word to London parents given during a meeting this summer which we both addressed?
Sir Keith Joseph: The fact that ILEA failed to spend £24 million of its budget shows the flabbiness of its budgeting. I have every reason to believe that the ILEA can meet the requirements of London education despite ratecapping.

South Africa (British Consulate)
3.52 pm
The Minister of State, Foreign and Commonwealth Office (Mr. Malcolm Rifkind): With permission, Mr. Speaker, I would like to make a statement about recent developments affecting our relationship with South Africa.
Six members of the United Democratic Front and the Natal Indian Congress entered the consulate in Durban on 13 September and sought an interview with the consul. They subsequently refused to leave and sought temporary refuge in the consulate. Having regard to the humanitarian considerations, the Government decided to refrain from evicting them.
The House will know that on 6 October three of the six voluntarily left the consulate.
On 7 October, one of the three men remaining in the consulate gave an interview to a reporter representing Independent Television News, using a radio transmitter which had been smuggled into the building. That interview followed previous incidents in the consulate involving clandestine photography, at which time we protested to those concerned. Following the ITN interview we sought an assurance from the three that there would be no repetition of that behaviour, which was clearly an abuse of the consular premises. The three declined to give such an assurance and have still not done so. Subsequently, on 18 October, the three issued through their lawyers a statement containing various demands, some directed at the South African and some at the British Governments.
When the six first sought refuge in the consulate there was no suggestion that they would indulge in political activity, which is clearly an abuse of consulate premises. The assurance we have sought that these activities would cease has not been forthcoming; on the contrary, it is clear from the statement issued on 18 October that the three intend to continue their political activities if they can.
It has also become impossible for our consulate in Durban to carry out many of its functions in the circumstances created by the coninued sit-in. The consulate is one of the smallest posts in the diplomatic service. It normally has only one United Kingdom-based officer. The accommodation is correspondingly small and was never designed for residence. These difficulties must also be taken into consideration. They are not a decisive factor but, added to the problems created by the political activities of the three, they presented us with an unacceptable position.
It was for those reasons that we decided that, as was announced on 21 October, we can no longer allow the three to receive visitors, other than doctors when necessary, and that because of the growing difficulties that have arisen as a result of the sit-in, the work of the consulate must now be considerably reduced. There is indeed little option. The situation of the past days has prevented normal work from being carried out.
We have also made clear that any disturbances caused by the activities of, or arising from the presence of, the three in the consulate, or by others outside it, would cause us to review our position immediately.
The South African Government announced in September that, because of what they described as our attitude to their request that we surrender the six or permit the South African authorities to arrest them in the
560
consulate, they regarded themselves as absolved from their undertaking to a United Kingdom court to ensure the return to the United Kingdom of four South African citizens charged with offences under Customs and Excise legislation. As the House now knows, these men did not appear yesterday as required to do so by the court. The court made it clear that in its view solemn promises had been broken by the South African Government and accordingly ordered that all the bail be forfeited, amounting in total to £400,000, and the court issued warrants for the arrest of the four.
I called in the South African ambassador this morning and conveyed to him the Government's strong condemnation of this breach of faith. I also told him that, following the issue of warrants for the arrest of the four defendants, we now expected his Government not to impede their appearance in court.
Mr. Donald Anderson: We are grateful for that statement and for the one tiny paragraph at the end which gave the Government's response to this outrage to our legal system. Will the Minister confirm that at least three of the Coventry four are, in effect, state employees of the South African Government, that the charges include conspiracy to export parts for guided missiles and that the decision to defy our courts was taken by the South African Cabinet at an early stage? Foreign Minister Mr. Piet Botha has nevertheless suggested that South Africa emerges with dignity from the Coventry proceedings. Do the Minister and the Government share that view?
Does the Minister agree that the Government's response to this outrage has been cool, lame and laid back and that essentially it has been "business as usual" with the apartheid regime? Why have the Government been so supine? Did they ever seriously expect the South African Government to send the four men back, despite pledging their full credit? Is it not clear, as has really been conceded by Mr. Piet Botha, that there was never any such intention, because the committal documents revealed the extent of covert and illegal South African activity in this country and had the matter proceeded to trial, this would have been publicly displayed to the entire world?
What action do the Government now intend to take about the illegal South African Government activity in this country which has been well documented to them? Would not ending the no-visa agreement allow greater control over the movements of South African nationals? Like the Government, we believe that there is no link at all with the consulate affair in Durban. Nevertheless, the Government have now chosen to make life more uncomfortable for the three at the consulate, denying them visits from their wives and lawyers and effectively making conditions for them at the consulate worse than those that they would face in detention under section 28 of the Internal Security Act?
Those men are there because it is their only means of protest. They face detention without trial or charge at the whim of one Cabinet Minister and with no form of judicial review, simply as a means of gagging them because they have expressed anti-apartheid views and have helped peacefully to organise boycotts of the constitution. Whose side are we on? What pressure will we put on the South Africans to lift those detention orders? By our actions, both in Coventry and in Durban, are we not showing ourselves to be the best collaborators in Europe with the apartheid régime?

561
Finally, what will world opinion make of our dual standards? When a friendly Commonwealth country — Nigeria—acted illegally, we sent the high commissioner home and yet, in the case of an apartheid regime we work on a doctrine of minimal response, verbal condemnation of the breach of faith, and no action at all.
These brave men and the cause which they represent will overcome, and the Labour party will be with them.
Mr. Rifkind: I utterly reject the absurd charge of collaboration which the hon. Gentleman has sought to bring. That is a most extraordinary allegation and one which no objective commentator on the events of the last few weeks would suggest with any seriousness.
The hon. Gentleman is correct to say that a number of the accused in the Coventry case are state employees in South Africa, and the South African Government themselves have said that it was a decision of the the South African Cabinet not to require them to return to the United Kingdom. The hon. Gentleman referred to the reported comment of the South African Foreign Minister that his Government had emerged with dignity from the court proceedings yesterday. If the Foreign Minister's comments were reported correctly, I can only say in response that the South African Government, through their counsel, sought to persuade the British court that the South African Government were entitled to require the men to dishonour their pledge to return to the United Kingdom. It was suggested to the British court that no order for the forfeiture of the bail money would therefore be justified. The British court totally rejected that claim, order the total forfeiture of the money concerned and the instant provision of warrants of arrest for the four. That sums up the position of the court.
The hon. Gentleman asks whether her Majesty's Government ever expected the four to be returned to the United Kingdom to stand trial. I remind him that, when the question of bail was considered by the court, the prosecution, representing the Customs and Excise, opposed the granting of bail in this case. The decision to grant bail was a decision of the court, and the hon. Gentleman would not expect me to comment further on it.
The hon. Gentleman asks whether we would now consider ending the no-visa agreement with South Africa. I do not believe that that would be an appropriate course of action. There are approximately one million South African citizens whose family or other links with the United Kingdom would mean that they were not subject to any visa agreement. Such a response would be a most implausible way of dealing with problems connected with people coming from South Africa, even if the Government were comtemplating action of that kind.
The hon. Gentleman suggested, finally, that conditions in the consulate are now worse than detention in South Africa, in respect of visits permitted to those resident in the consulate at present. I remind the hon. Gentleman that those in the consulate entered it at their own choice and can leave it at their own choice at any time. They are in no way constrained by any action of Her Majesty's Government so far as their presence in the consulate is concerned. We have made it plain to them that we would like them to leave and that they are impeding the normal work of the consulate, but we have not been prepared forcibly to evict them against their will. For the hon.
562
Gentleman to make any comparisons whatsoever with the powers of detention available to the South African Government shows how lacking in objectivity his remarks today have been.
Sir Peter Blaker: My hon. Friend has the support of Conservative Members for the way in which he has handled this extremely difficult problem. He has explained to the House that when the six men arrived in the consulate, they did not claim to be seeking political asylum. Will he confirm that, in international law, there is no right to political asylum in consular premises?
My hon. Friend says that we do not propose to evict the men against their will. In that, he will have the support of the House. However, we shall also support him in insisting that they should not indulge in political activities. As I understand it, that would itself be against international law.
Mr. Rifkind: I thank my hon. Friend for his comments and confirm that in international law there is no such right of political asylum. In any case, the three have not sought to exercise such a right. They have made no request for political asylum, so that particular matter does not arise.
Mr. Russell Johnston: One accepts that consulates cannot become bases for political activity, but, if the Durban three give the assurances that the Government have sought, what did the Minister mean when he said that there would be a review if disturbances happened which were not directly caused by the three? The Minister referred to disturbances arising from the presence of the three or caused by others outside. Could he explain that? He appears to say that a review might take place because of events for which the three were not directly responsible.
On the question of the weapons smugglers, why is it that such a disgraceful action by the South African Government—official and overt action—does not justify the recall of our ambassador?
Mr. Rifkind: We are concerned that it should be possible to use the consulate for normal consular purposes. Anything that impedes that is to be regretted and deplored. Any form of action which, in addition to causing administrative problems, meant that the consulate was being used for purposes related to partisan political activity in South Africa, would be in clear breach of the international obligations under which consulates operate everywhere. We have had to make it plain that any use of the consulate which was incompatible with our normal international obligations would be bound to lead to an immediate review of our position.
The non-compliance by the South African Government with their solemn commitment to the court has led to the forfeiture of approximately £0·5 million. Her Majesty's Government have strongly condemned the South African action. We have told the South Africans that, in view of the warrants for the arrest of the four which the court has ordered, we expect the South African Government to take no further action to impede the return of the four to the United Kingdom to stand trial.
Sir Patrick Wall: One must greatly regret the action of the South African Government in the arms case. However, what positive action does my hon. Friend intend to take to prevent the Durban three from making further propaganda against their own Government, which,

563
as my hon. Friend says, could be against international law? What does a review mean? Will my hon. Friend close the consulate or turf the men out?
Mr. Rifkind: Our concern is not that the three should indulge in political activity, but that they should not indulge in political activity in the British consulate. It is purely for that reason that we have told them that it is not possible for us to permit access for other than medical purposes. We must ensure that there is no repetition of the abuse of such access which we have recently experienced. We took that decision with regret, but we believe that we have no choice if we are to comply fully with our international obligations.
Mr. Norman Buchan: Are these not shameful weasel words for a British Minister to utter? They place the Minister somewhere to the right of Palmerston. The Minister says that if the men were free they would indulge in political speeches but that that cannot be allowed in the consulate. Does he not know that that is nonsense? If he silences the men, he is condoning the action of the South African Government. The Minister is silencing the men. He is censoring them. He is condemning them with the same political vindictiveness that the South African Government have displayed in the past. Would not the Minister do better to tell the South African Government, among other things, that he will defend the men's right to speak freely and that many of us in Britain were proud of the honouring of Bishop Tutu, who stands up for the civilisation of South Africa rather better than the Minister is doing today?
Mr. Rifkind: The whole House will share the hon. Gentleman's criticism of the South African laws that permit detention without trial. That point is not an issue. The issue is whether it would he appropriate or possible for any Government with a consulate in a foreign territory to permit its use for partisan political activities. The hon. Gentleman must be aware that it would be quite wrong, whether we were dealing with South Africa, the Soviet Union or any other country, to allow political speeches or statements to emanate from a British consulate or other diplomatic premises. The hon. Gentleman can express his views on the laws of detention in South Africa, many of which I might agree with, but that does not alter the fact that we have no choice but to insist that, if we expect others to respect international law in regard to the use of diplomatic premises in the United Kingdom, we must accept our obligations. We are determined to do that.
Mr. George Gardiner: Although I recognise the humanitarian motives that led my hon. Friend to allow the ANC members to remain in our consulate initially, does he agree that unless the Government take more determined steps in future to secure the eviction of unwanted guests, our consular buildings will become increasingly vulnerable in many other parts of the world?
Mr. Rifkind: I accept the full force of my hon. Friend's point. We are anxious to ensure that there is no abuse of consular or diplomatic premises elsewhere in the international community. As my hon. Friend acknowledged, especially sensitive and delicate humanitarian matters were involved in this case. We took them into account when deciding not to evict forcibly the three men from the consulate. They entered the consulate without indicating their intentions. When they were in the consulate and
564
refused to leave, we had to take into account the fact that the only way in which they could be removed forcibly was by inviting the South African police into the consulate to evict them. I believe that the House agrees that that would not have been an appropriate course of action.
Mr. Andrew Faulds: Does the Minister comprehend, even if the Foreign Secretary and the Government do not, the damage that has been done to Britain's name in the wider world by the Government's attitude towards and treatment of the three men in Durban? As the South African Government decided to break faith on the Coventry four and in view of the treatment—the quite right treatment — of the Nigerian high commissioner, is it not incumbent on the Government to require the South African ambassador to pack his tatty bags and go?
Mr. Rifkind: There has been wide international understanding of the Government's stance. I am not aware of criticism from other Governments of the type that the hon. Gentleman suggests.
Mr. Ian Lloyd: Is my hon. Friend aware that even those of us who think that the United Nations arms embargo is wholly ill-advised, impractical and contrary to western interests regret as much as he does the South African Government's decision not to return the four for trial? I believe that that will prove a great error of judgment. Is it not equally important that we should recognise the clear and unequivocal opinion of international lawyers on asylum? It has been said that:
"There is, in our opinion, no doubt that this right of asylum, even in the case of ambassadors, can be properly conferred only by the consent of the countries to whom they are accredited."
Does not that apply wholly to the Durban case and vindicate utterly what my hon. Friend has said?
Mr. Rifkind: I thank my hon. Friend for his comments, especially those in respect of his disapproval of the South African Government's decision not to return the four for trial. I agree that that will greatly damage South Africa's reputation. For the reasons that I have already mentioned, there has not been a specific request for political asylum but I have no reason to differ from my hon. Friend's observations on international law.
Mr. Tom Clarke: When the Minister met the South African ambassador this morning, did he express his anxiety that Mr. Botha's recent visit appears to have been a meaningless exercise? Did he complain that, in spite of the Prime Minister informing the House of the many lectures that she said that she had delivered to Mr. Botha about his Government's policies —if those lectures were delivered as the Prime Minister said they were—they were obviously treated with the utmost contempt?
Mr. Rifkind: My discussions with the South African ambassador this morning were limited to recent developments of the type mentioned in my statement.
Mr. John Carlisle: Does my hon. Friend agree that, whatever the humanitarian grounds, the Government committed a serious error of judgment in allowing the Durban three to remain in our consulate once their political purpose had become clear? Does he agree that the only way out of this dispute is forcibly to remove them? Does he agree that, although the South African Government's decision that the four should not return for

565
trial is regrettable and utterly deplored on both sides of the House, the stupid and ignorant intervention of the hon. Member for Swansea, East (Mr. Anderson) and his visit to South Africa have made matters worse as he might now have given some credibility to the South African Government's decision not to return those four men?
Mr. Rifkind: I shall not comment on what my hon. Friend said about the hon. Member for Swansea, East (Mr. Anderson) The Government's main concern has been to consider humanitarian aspects of the case and our international obligations in regard to the use of the consulate. We believe that the only way in which this matter could have been concluded without the cooperation of the three men in the consulate would have been to invite the South African police to enter the consulate. We have no international obligation of that type and no one has suggested that we do. On that basis we can say frankly and without qualification that the Government have complied with international obligations. We noted that, when the South African Government tried to persuade the British court that bail should not be forfeited for the various reasons that counsel on behalf of the South African Government advanced yesterday, the court did not accept the grounds. We believe that we are therefore able to say that the Government have complied with the humanitarian and legal criteria that we have applied throughout the incident.
Mr. David Winnick: The hon. Member for Luton, North (Mr. Carlisle) obviously speaks for the South African authorities and not for the British people. Is the Minister aware that a comparison is bound to be made between the petty attitude that has been adopted towards the people in the British consulate and the Prime Minister's wining and dining of the South African president earlier this year? When will the Government recognise that, in South Africa, there is a gangster Government who establish themselves on the basis of racial tyranny? Why do the Government not recognise that our job is to aid and comfort the oppressed, not the oppressors?
Mr. Rifkind: I note the hon. Gentleman's comments. I also note that he believes that, in respect of other countries with tyrannous regimes, dialogue is the appropriate means by which to influence their activities. We do not believe in double standards, even if the hon. Gentleman does.
Mr. Nicholas Winterton: Although I regret the South African Government's decision to prevent their nationals from returning to Britain to face trial in Coventry, and I want there to be social and political change in South Africa, may I ask what would the Government expect if consulates and embassies in Britain were invaded by people who had broken British law and the countries concerned did not force them to leave? What is my hon. Friend's view of the visit made by the hon. Member for Swansea, East (Mr. Anderson) to South Africa when he failed to go to Zimbabwe to secure the release of Bishop Muzorewa who was detained illegally and without trial for many months?
Mr. Rifkind: Throughout the incident we have complied with our international obligations and there is
566
therefore no basis for a comparison such as my hon. Friend suggests. Anyone who is charged with an offence in the United Kingdom appears in court, is able to defend himself and can be tried in public by a court which decides on his innocence or guilt. I hope that my hon. Friend will not draw too close a comparison between what appertains in Britain and circumstances in South Africa in this case, which involve detention without trial, and no opportunity for the matter to be considered in court.
Mr. Winterton: So was Bishop Muzorewa.
Mr. Rifkind: The Government, if not the Labour party, believe that human rights should be treated equally throughout Africa.
Mr. D. N. Campbell-Savours: Should bail conditions imposed on South African citizens in British courts in future be in any way influenced by the decision of the South African authorities not to uphold the return to the United Kingdom of their citizens on this occasion?
Mr. Rifkind: The hon. Gentleman will appreciate that bail conditions are a matter for courts and are not for the Government to comment on. In this case, as in future cases, it will be for the courts to decide whether they are satisfied and whether what is proposed by those seeking bail should be agreed to.
Mr. David Ashby: Will my hon. Friend please remind the hon. Member for Swansea, East (Mr. Anderson) that at least he was able to travel to South Africa and to visit the consulate, and that he was able to abuse the hospitality of the host country? In view of the fact that the occupation is embarrassingly illegal in international law, should we not simply close the consulate?
Mr. Rifkind: I agree with my hon. Friend's earlier comments, but I cannot accept his final contribution. There is no basis on which he is entitled to suggest that the presence of the three men within the consulate is a breach of international law. The Government have been punctilious throughout the episode to ensure that that remains the case.
Mr. Geoffrey Robinson: Does the Minister agree that the decision of Mr. Justice Leonard is without sound legal precedent? Does he recognise that today at the Dispatch Box he has displayed a pathetic, supine attitude towards the South African Government? Will he inform the House of the legal and diplomatic measures and powers at his disposal to ensure that the four arms smugglers return and stand trial in accordance with the judicial procedures of this country? Will he assure the House of his firm determination to use those powers?
Mr. Rifkind: I remind the hon. Gentleman in the most polite and friendly way that that matter was for the court to consider. The court has issued warrants for arrest. When warrants for arrest are issued, a procedure is subsequently followed to ensure that those in respect of whom they were issued appear in court. There is no reason to doubt that the normal procedures will apply in the present case. However, that will be a matter for the courts, not for me.
Sir Hector Monro: Will my hon. Friend bear in mind and welcome the political and constitutional changes that have taken place in South Africa since the

567
referendum a year ago? Will he balance that against some actions taken in countries that attained independence during the past 20 years that have been to the detriment of their own nationals?
Mr. Rifkind: We have noted that there have been major constitutional changes within South Africa. It is also the case that those constitutional changes are a matter of substantial controversy within the Asian and coloured communities. It is regrettable that as yet there have been no constitutional proposals for the political rights of the black community in South Africa. We shall watch with interest the development of constitutional reform within South Africa, and if there is evidence of real reform we shall welcome it.
Mr. Richard Caborn: When the Minister met the South African ambassador, did he tell him that the problem of the Durban three could be resolved simply by lifting the detention orders? In view of what has happened and what the Minister has said from the Dispatch Box, did the Minister raise that question with the ambassador and, if so, what answer did he receive?
Mr. Rifkind: It has always been the case that the Government are not prepared to act as intermediaries in this matter or to negotiate on behalf of the Durban three or anyone else. Therefore, it would be inappropriate for me to make such suggestions.
Mr. Michael Latham: In view of the deplorable behaviour of the South African Government regarding the Coventry case, how can we continue to have normal diplomatic relations? If the South African Government continue to make no attempt to comply with British justice, should that not require the removal of at least one senior diplomat?
Mr. Rifkind: We have made it clear to the South African authorities that non-compliance with their solemn pledge to the court is bound to have a significant effect on bilateral relations. That remains the case.
Mr. Nigel Spearing: Will the Minister confirm that the linkage used by the South African Government in this case, bail and the consulate, is totally against established diplomatic practice? Did the Minister put that to the ambassador; and, if so, what was the ambassador's response?
Mr. Rifkind: That was put by me both this morning and on a previous occasion when I saw the ambassador. The substance of the case that counsel for the South African Government put to the court was based on the supposition that there was such a linkage. The hon. Gentleman will be aware that the court refused to consider that matter because it was not a matter for the court to consider. The court insisted that as the pledge given by the South African authorities had not been complied with, there was no alternative but to insist on the forfeiture of the £400,000 bail money.
Mr. Anthony Nelson: Is my hon. Friend aware that he enjoys widespread support in this country and elsewhere for his handling of the matter? Will he continue to be careful not to rule out the possibility of stricter measures if that proves necessary? So long as the position continues, the security and functioning of our consular offices abroad and the homes of our overseas representatives will be jeopardised. Does the Minister
568
agree that in that context the futile mission of the hon. Member for Swansea, East (Mr. Anderson) at the behest of the Leader of the Opposition smacked more of trying to stir up matters than of genuinely trying to resolve a difficult problem?
Mr. Rifkind: I agree with the first point raised by my hon. Friend. The announcement at the weekend restricting access shows that we are determined to take the sort of steps that my hon. Friend recommended. The hon. Member for Swansea, East (Mr. Anderson) was in no way going on behalf of or with the approval of the Government. He must take full responsibility for his own decision to go to Durban. There is nothing else that I can usefully add in respect of his visit.
Mr. Dave Nellist: Will the Minister explain the difference of approach between the extremely lax treatment of the four South African arms smugglers who escaped from Coventry for the price of a couple of diamonds when it was clear that they would not return, with the harsh conditions of bail and detention imposed on 7,400 miners who sought to defend jobs and communities?
Mr. Rifkind: The hon. Gentleman will not expect me to comment on decisions taken by a court in respect of bail.
Mr. Alfred Dubs: Does the Minister accept that many people will find it extraordinary that he allowed the South African official who gave an unequivocal assurance to the British court to remain in this country with diplomatic status? Is not the only course open to the Government to ask that official or the ambassador to leave the country? Britain cannot trust that official in view of what he has done.
Mr. Rifkind: Yesterday, the court in its judgment explicitly exculpated the official from any personal responsibility for the decision. The court went out of its way to state that it was satisfied that the official was not responsible for the failure to comply with the undertaking given to the court. It was the responsibility of the South African Government, not of the official.
Mr. Frank Cook: Is the Minister aware that he made an ambiguous statement in response to his hon. Friend the Member for Rutland and Melton (Mr. Latham) when he stated that any repetition of this practice by the South African authorities would "have a significant effect on bilateral relations"? Will the Minister clarify whether that significant effect would be adverse or favourable, how it would have the effect and to what degree?
Mr. Rifkind: I would have thought that that went without saying, but for the sake of the hon. Gentleman, I confirm that the effect would be adverse.
Mr. Anderson: The key to the issue is that the South African Government have dishonoured an unconditional pledge that promised their full credit to our court. We still await a reply from the Minister about what effect that will have on our bilateral relations. All the Minister said in his statement — he has not elaborated on it — is that he strongly condemned the breach of faith. Is he seriously saying that, following that breach, our bilateral relations will continue as before? If he is not, what aspects of our relations will be affected? If nothing is done—he has

569
not said that anything will be done—is it not clear that any official of the South African embassy can be instructed by his Government to lie to our courts and emerge with impunity?
The Minister told me by letter on 8 October that, if the South African Government failed to return the four men, our Government would view the matter very seriously. Why then, on the precedent of the Dikko affair—that was a friendly Commonwealth country — is he not asking the South African ambassador, as the representative of his Government, to pack his bags and go?
Mr. Rifkind: If the hon. Gentleman had listened to my original statement he would be aware that not only did I condemn the breach of faith, as represented by this incident, when I saw the South African ambassador this morning, but I told him that, following the issue of warrants for the arrest of the four defendants, we now expected his Government not to impede their appearance in court. That remains our position and we hope that the South African Government will, on reflection, carry out their obligation as originally transmitted to the court.

Coal Miners' Families (Supplementary Benefit Payments)
4.31 pm
Mr. Frank Cook: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 10, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the reinstatement of full supplementary benefit payments and reimbursement for that withheld from miners' families."
I consider this matter to be specific in that it relates to moneys withheld by the DHSS from supplementary benefit payments on the rationale that the dispute was official and that, consequently, the National Union of Mineworkers was obliged to pay strike pay. It is specific in that the rationale was grossly inaccurate in the light of the recent court decision to fine Mr. Scargill £1,000 and the NUM £200,000 for contempt of court.
The subject is important because more than £40 million in supplementary benefit payments for food and heating bills is being removed from about 80,000 families during a period of 33 weeks. It is urgent in that I have heard of instances of families, certainly in the north-east and probably throughout the country, having their power and heating disconnected at the time of the year when such services are crucial to the health of young children, the weak and the aged. We suspect that those disconnections are being carried out by unqualified and non-certificated operators, not by direct employees.
Mr. Speaker: The hon. Member asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
"the reinstatement of full supplementary benefit payments and reimbursement for that withheld from miners' families."
I listened with care to the hon. Gentleman, but I regret that I do not consider the matter that he has raised to be appropriate for discussion under Standing Order No. 10, and I cannot, therefore, submit his application to the House.

STATUTORY INSTRUMENTS, &c.
Ordered,
That the draft Double Taxation Relief (Air Transport Profits) (Kuwait) Order 1984 be referred to a Standing Committee on Statutory Instruments, &c.
That the draft Double Taxation Relief (Taxes on Income) (China) Order 1984 be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Biffen.]

Breach of Confidence
4.33 pm
Mr. Steve Norris: I beg to move,
That leave be given to bring in a Bill to impose obligations of confidence giving rise to liability in tort on persons acquiring information in certain circumstances and otherwise to amend the law of England and Wales as to civil liability for the disclosure or use of information; and for connected purposes.
I apologise for the complexity of the long title, but I must ask the House to bear with me for a few moments more while I relate the equally complex background to the Bill.
In October 1981 the Law Commission reported in response to a request by the Lord Chancellor that had been made about eight years earlier in March 1973. The Lord Chancellor's request was that the Law Commission should, first, consider the law of England and Wales relating to the disclosure or use of information in breach of confidence and to advise what statutory provisions, if any, are required to clarify or improve it; and, secondly, to consider and advise what remedies, if any, should be provided in the law of England and Wales for persons who have suffered loss or damage in consequence of the disclosure or use of information unlawfully obtained, and in what circumstances such remedies should be available.
The Lord Chancellor was prompted to call for the report following the publication of a report by the Younger commission on privacy which had been published the previous year. That commission suggested that the present law of confidence was inadequate and that a new law should be propounded, the basis of which should be four straightforward principles. The first principle is that it should provide remedies against the disclosure or other use of information not already generally known by persons in possession of that information under an obligation of confidence. That is the straightforward case where I tell someone something in confidence and he breaks that confidence, thus giving me a right of action against him.
Secondly, the law should make available remedies not only against a person who was entrusted by another with information in confidence but against a third party to whom that person disclosed that information. That means that if an individual tells my confidence to the press or to a commercial competitor I should have a remedy not only against the individual who broke the confidence but against the third party.
Thirdly—this is extremely important—the law must protect the public interest in the disclosure of some sorts of information and the defendant's right of disclosure in some privileged situations by the provision of appropriate defences. That is essentially the defence of public interest about which I may say a word later.
Fourthly, the law must afford remedies whether by way of injunction, damages or claims for loss of profit that do justice to the reasonable claims of plaintiffs and defendants in differing cases.
The reason for the Law Commission's reference was that few people appreciate the inadequacy of the present law of confidence. It is entirely non-statutory and based on precedent. There is no such thing as a specific law of confidence. Ironically, one of the best known early actions for breach of confidence was that brought by Prince Albert in 1849 against a picture gallery owner, Mr. Strange, who apparently intended to distribute unauthorised copies of private etchings belonging to the royal couple, who were
572
clearly decidedly unamused by this early example of entrepreneurial free enterprise. They obtained the first injunction for breach of confidence. Be that as it may, in an area as important as this in terms of civil rights, the idea of a law based wholly on precedent is inadequate. Therefore, the Bill abolishes the present law and its existing remedies and provides the first certain basis for comprehensive personal protection.
I wonder whether it is also appreciated that, although the old law gave a general right of action against a person to whom one had disclosed a confidence, it failed to provide any reasonable action where the confidence was breached by the use of interception or surveillance, whether overt or surreptitious, by a third party. It is an incredible indictment of the present law that, although I can bring an action for breach of confidence against the person to whom I told it, I cannot bring such an action against someone who deliberately and improperly intercepts my communication. The Bill will provide an immediate and effective remedy to those whose confidence has been breached in those circumstances.
I may say in passing that I hope that, in this connection, the Government will take on board the legislation on surveillance and telephone tapping, not only in relation to the civil remedies covered by my Bill, but in relation to the creation of specific criminal offences for the improper or unauthorised interception of communications. Earlier this summer we had the decision of the European Court in the Malone case, which made it clear that the European Court at least considered our practices to be ineffective. This must surely now be a priority for the Government.
I must stress that the Bill is not intended to prevent a free press or the general public from acquiring information to which they clearly ought to have access. At present there is no clear distinction between what information should be private to an individual, particularly one in public life, and what should be general knowledge. My Bill lays down a clear defence of public interest in which a plaintiff's claim—for example, a plaintiff who sought an injunction to prevent a so-called breach of confidence — would fail unless he established that the public interest in preserving the confidentiality of the information outweighed the public interest in its disclosure or use. In my view, that is as it should be, and I believe that every responsible journalist and editor would agree. If as a byproduct of its enactment the Bill provides some protection against some of the worst excesses of invasion of privacy by the media that we have seen in the past three years, so much the better.
The Bill is not about protecting Governments. It is not a weapon to be used against civil servants or others. Indeed, the only occasion that I can recall when the Government used the civil law to try to obtain an injunction for breach of confidence was in the Crossman diaries case, when the Attorney-General applied for an injunction to prevent publication. On that occasion the Lord Chief Justice made it quite clear that the Attorney-General had not established a sufficient case of public interest to prevent disclosure.
The Bill actually offers a wider definition of public interest than is currently available to a defendant of an injunction to prevent disclosure. As I have said, it would be for the plaintiff to prove the public interest in confidentiality rather than the public interest in disclosure.

573
This is a civil rights measure, not a governmental protection measure, and I hope that that is clearly understood on both sides of the House.
I introduce the Bill because at a time when immensely sophisticated telecommunications and surveillance equipment is freely available to Governments and individuals the potential threat to the privacy of the ordinary citizen is horrifyingly real. Any Government who are concerned to protect the freedom of the individual, as I hope this Government are, would want to put this Bill at the very top of their legislative programme. The Law Commission's Bill has already been left on the shelf too long, and I very much hope that the Government, mindful, as I am sure they are, of their importance, will find time before too long for a measure which has outstanding merit and which it would be immensely dangerous for us all to ignore.
Mr. Tam Dalyell: I gave you notice, Mr. Speaker, that I intended to oppose the Bill, but having listened carefully to the hon. Member for Oxford, East (Mr. Norris), and in view of his specific assurance that it is not about the subject that I thought it was about, I withdraw my opposition.
Question put and agreed to.
Bill ordered to be brought in by Mr. Steve Norris, Mr. Derek Conway, Mr. David Evennett, Mr. Rob Hayward, Mr. Greg Knight, Mr. Tim Yeo, Mr. Timothy Wood and Mr. David Ashby.

Breach of Confidence
  BREACH OF CONFIDENCE
  Mr. Steve Norris accordingly presented a Bill to impose obligations of confidence giving rise to liability in tort on persons acquiring information in certain circumstances and otherwise to amend the law of England and Wales as to civil liability for the disclosure or use of information; and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 231.]

Rate Support Grant (Scotland)
4.44 pm
The Secretary of State for Scotland (Mr. George Younger): I beg to move,
That the Rate Support Grant (Scotland) (No. 2) Order 1984, dated 18th July 1984, a copy of which was laid before this House on 23rd July, be approved.
The order that we are debating today is a short one and it has one purpose — to reduce the amount of rate support grant payable to Scottish local authorities in 1984–85 by £90 million.
I announced my decision to make this reduction in my statement to the House on 17 July, and the order before us was laid very shortly after that. I explained the reasons for my decision in July and also pointed out the two significant improvements in the arrangements for grant reductions which remove unfairnesses which had previously existed. However, before dealing with the details of the order, I should like to consider the question of local authority expenditure more generally.
Whether we like it or not, expenditure by local authorities is part of public expenditure. Indeed, it forms over half of the budget of the Scottish Office. No Government can ignore this expenditure if they are to run the economy of the country properly. No Government so far have ignored it, or have even suggested that they should.
The last Labour Government were no exception. They made clear the levels of spending that the country could then afford, and they too faced protests from local government when this was curtailed. They also reduced the percentages of RSG in order to discourage overspending. Indeed, they hold the record on this for the largest such reduction ever—4 percentage points cut in 1977–78.
This, I hope, puts in perspective the absurd antics of a few authorities which are trying to pretend that in some new way local autonomy is being threatened. That is nonsense, and they know it. We in government have no intention of allowing these party political excesses to prevent us, who have the full responsibility for running the economy, from getting our sums right.
That brings me to the other possible new factor which faces us tonight. It would appear—and I hope that I am wrong in this—that for the first time in history we have an official Opposition who are formally pressing their supporters to break the law of the land.
No other interpretation can be put on the resolution passed at the recent Labour party conference; but I sincerely hope that we can be assured this evening that whether or not this was the view of the Labour party conference, it is emphatically not the view of the parliamentary Labour party and its leaders in Scotland. I shall return to this point later.
We start tonight from the firm base that it is the judgment of the Government that public expenditure has to be reduced for the health of the economy generally and that local government has to play its part in that undertaking.
The Government have asked local authorities, as did previous Governments, to plan their expenditure in line with overall provision for that expenditure. However, local authorities have consistently since 1979 planned to spend above provision. From 1979–80 onwards the

575
planned excess increased to a level of over 8 per cent. in 1981–82 and 1982–83. This overspending took two forms. The first was substantial increases in expenditure by individual authorities which took them well above their current expenditure guidelines with significant effects on their ratepayers. The activities of the former administration of Lothian regional council are the best known example of that. The second form of overspending was made up of the great majority of authorities spending smaller amounts above their current expenditure guidelines and all contributing to the large general excess over the Government's plans.
The first problem we have tackled successfully through the new powers we have taken in successive Acts to enable us to reduce the rates of selected local authorities who are planning excessive and unreasonable expenditure. Selective action has produced significant expenditure savings from the first time it was used in 1981–82, and subsequently produced very welcome benefits for ratepayers when the Government were able to ensure that the expenditure savings were returned to the ratepayers in the form of reduced rates. We did not feel it was necessary to use this power in the current financial year, but it remains available and is clearly an effective way of dealing with an authority which plans excessive and unreasonable increases in its expenditure and rates.
The second form of overspending we have dealt with by reducing the amount of rate support grant payable in the course of the year. This method has also had significant effects on expenditure as a comparison between budgets and outturn shows. We have taken a number of steps to make this system of grant reduction fairer to ensure that the pressure is directed to those authorities spending furthest above their guidelines and that recognition is given to those authorities that spend in line with our plans. We first exempted all authorities budgeting to spend within guidelines from any grant loss. We then recognised the efforts of those who had brought their expenditure below guideline at outturn by cancelling the penalty for such authorities. For 1984–85, as I have already made clear, we are taking this a stage further. The new power in section 1 of the Rating and Valuation (Amendment) (Scotland) Act 1984 will enable us for the first time to relate directly the loss of grant to the level of excess measured against current expenditure guidelines. A further improvement for 1984–85 is that every penalty will be adjusted in the light of outturn. An authority whose expenditure at outturn is below guidelines will, as is already the case, have its grant penalty cancelled. However, for the first time an authority which, while still above guidelines, reduces its expenditure at outturn will have that penalty reduced. Conversely, of course, an authority which increases its expenditure excess will have an increased penalty at outturn.
This review of penalties at outturn is in direct response to representations from the Convention of Scottish Local Authorities, which has made representations to me and my hon. Friend the Under-Secretary about the unfairness of the system, which did not recognise the efforts of authorities in reducing their expenditure adequately.
Overall, the combined effect of these two approaches to overspending—selective action for very high spenders and grant reductions for the other overspenders— has succeeded in bringing local authority expenditure fairly close to, but not yet below, the level that prevailed when we came into office in 1979. Local authority expenditure
576
in 1983–84 at near final outturn was, in real—that is, volume —terms still 2·1 per cent. above its 1978–79 level.
However, this would never have happened without the action that we have taken and in particular without the grant penalties that we have been forced to impose. In 1983–84 local authorities budgeted to spend 4·6 per cent. above the Government's plans, but following selective action and general grant abatement this excess has come down to just over 2 per cent. In 1984–85, however, authorities have budgeted to spend 4·3 per cent. above the Government's provision—only a little improvement over 1983–84 and still 2·6 per cent. in real terms above what they were spending in 1978–79. Given our experience of grant abatements over past years, and the level of budgeted expenditure for 1984–85, it was clear that I had again to take action to bring local authority expenditure down. As authorities were still planning to spend at about the same level above provision as they had in the previous year, I decided that a heavier grant penalty was needed if expenditure was to be brought into line with provision. The total penalty in 1983–84 — selective action and general abatement taken together—was £64 million. I decided that it was necessary to increase this to £90 million in order to bring the necessary pressure to bear.
Authorities were all told on 17 July the amount of grant that they would lose in the light of their planned excess over guidelines. No authority spending within guidelines had any penalty and the penalties for those above guidelines ranged between 64 per cent. of the overspend for authorities spending under 1 per cent. over guidelines up to 87 per cent. of the overspend for authorities spending 14 per cent. more than their guideline.
Mr. Donald Stewart: In the light of these arrangements, what adjustments, if any, will the Secretary of State make for a local authority such as mine, which has no hope of spending up to its guideline?
Mr. Younger: If the authority has no hope of spending up to its guidelines, it will not have any penalty. As far as I know, that is not the position of the Western Isles council, but it may be. I am sure that the right hon. Gentleman will be able to make his point later on.
We have emphasised to authorities the benefits to them and their ratepayers if they reduce their expenditure and thus reduce or cancel the penalty altogether. This was one of the points made in the letter that I sent to the conveners and provosts of all Scottish authorities. I drew particular attention to the cost in rate terms of failing to do anything about the grant penalty. At the regional level the equivalent in rate poundage terms of the grant penalty is up to 6·4p in the pound, and this is the kind of price which ratepayers will have to pay next year if councils take no action to reduce their expenditure now. A number of authorities have gone out of their way to say that they propose to take no action to reduce expenditure and I understand that one or two are even proposing to increase their expenditure. The effects for the ratepayers of these authorities will be very unwelcome for not only will they have no relief from the rate effect of the present grant penalty, but they will have to meet the cost of the increased grant penalties that will follow from increased expenditure.
Therefore, I take this opportunity to underline the point made in my letter. The effects on rates of failure to take

577
action in response to the reduction in grant will be both unwelcome and unnecessary. The reductions in expenditure between budget and outturn in 1983–84 show that authorities, whether they are prepared to admit it or not, see the logic of reacting to grant reductions in a way that takes account of ratepayers' interests. This year's penalty may appear heavy at £90 million, but it can be reduced very significantly by the efforts of authorities in bringing their expenditure down. I look forward to the figure of £90 million being greatly reduced at outturn as large numbers of authorities reduce their expenditure and hence either cancel or bring down the grant penalty that was imposed on the basis of their budget.
Mr. Gavin Strang: Does the right hon. Gentleman recognise that the regional council with the highest percentage excess over guidelines in the Government's report is the Lothian regional council, which has already destroyed 4,500 jobs as a result of the Government's cuts? On the basis of next year's guidelines, which I recognise we are not debating today, it will have to destroy another 5,000 jobs. Where will this end? How many more teachers, nursery teachers and home helps in Lothian will lose their jobs?
Mr. Younger: Ever since the lamented days of the previous Lothian council administration, the council has been saying that vast numbers of compulsory job redundancies will occur, but that has never happened. I understand that there have been no compulsory redundancies yet in Lothian regional council, and I hope that that will continue. Overspending in that council was well known, and something had to be done to save the ratepayers from the burden that they were carrying. The Government's actions were welcome to them, as I am sure that the hon. Member for Edinburgh, East (Mr. Strang) will know from his local people.
I shall now tell the House what I propose to do about a particular problem affecting 1983–84. The reduction in rate support grant in response to planned overspending for 1983–84 was fixed in July 1983 at £45 million. This penalty figure was to be regarded as fixed and there was no commitment to adjust it later in the light of the efforts made by authorities to bring down their expenditure and the eventual level of overspending at outturn. The system was that the penalty of an authority was cancelled if it came below guidelines, and the share of the penalty for authorities remaining above guidelines went up since the total penalty was fixed. Final expenditure data for 1983–84 shows that a large number of authorities have reduced expenditure, some significantly. Some 23 of the 65 authorities, including no fewer than seven regional councils, are no longer liable to penalty or full penalty. Around two thirds of the remainder have reduced expenditure but remain outwith the protection arrangements. The result of this is to reduce the expenditure excess over provision by more than half to £59 million or 2·2 per cent. In the circumstances, I have decided to cancel the penalty of the authorities whose expenditure has come within the protection levels, to reduce the penalty of four more authorities so that it does not exceed the amount by which their expenditure exceeds the protection levels and not to increase the penalties of the remaining authorities. This decision recognises the efforts made by many authorities to reduce expenditure and will require an
578
increase of around £17·5 million in the present level of rate support grant for 1983–84. The appropriate provision will be included in the rate support grant order to be made later this year. The fact that almost a third of authorities have managed to avoid penalties altogether in 1983–84 shows that expenditure can be brought under control if the will is there and that what we are asking authorities to do is not unreasonable. I believe that this is an equitable solution to a problem that I know has been troubling many people, including the convention. The problem will, of course, not arise again since from 1984–85 onwards the total penalty will, because of the terms of the Rating and Valuation (Amendment) (Scotland) Act 1984, come down automatically as individual authorities' penalties come down at outturn.
Mr. George Foulkes: I was not very clear about the second group of authorities in the announcement. The Secretary of State mentioned four particular authorities. Will he tell us which authorities they are? I was not clear as to what kind of category he was describing.
Mr. Younger: That is a valid point. I will ask my hon. Friend to give more details about the precise authorities and about how the proposal will work.
I hope that I have made the principle clear. It is that where authorities bring down their expenditure within or near to guidelines, the resulting reduction in penalties will not be visited as an increased penalty on the rest of the authorities that are still within penalty.
Mr. Foulkes: I am grateful to the Secretary of State. I hope he will accept that for once I am not making a political point but genuinely seeking information. Some hon. Members may wish to make speeches from the Back Benches about authorities relating to the constituents whom they represent. It might save the House a good deal of time if we could be told about the authorities which are no longer to suffer a penalty. If we can have that information, some of those speeches may not be necessary.
Mr. Younger: I am greatly enjoying the luxury of a speech in which the hon. Gentleman is not making political points. A good many authorities are involved and my hon. Friend will give further details.
Every time we try to bring local authority expenditure into line with our plans, we are told that it will have a disastrous effect on services and that it will be impossible to make any further savings. One of the problems of large organisations—central Government are and ought to be fully aware of this—is that of ensuring efficiency and value for money across a large range of activities. It is much easier for pockets of inefficiency to develop in large organisations than in small ones, and also for circumstances to change without expenditure being adjusted. The elimination of such waste and inefficiency is a problem that we share with local government.
Mr. Robert Hughes: On a point of order, Mr. Deputy Speaker. For the proper conduct of debate, surely the Secretary of State should tell us the names of the authorities to which he is referring, otherwise hon. Members might make speeches without knowing the facts. That would allow the Minister, in replying to the debate, to ridicule those who made their speeches without being aware whether their authorities were involved.
Mr. Deputy Speaker (Mr. Harold Walker): The hon. Gentleman's point is out of order.
Mr. Younger: I am very sorry if the hon. Member for Aberdeen, North (Mr. Hughes) feels offended. I thought that it was rather a good piece of news. I hope that I shall be acquitted of doing anything that is damaging to the hon. Gentleman.
Mr. Hughes: As it is very seldom that the Secretary of State issues good news, and as I am sure he would like to be congratulated on giving the House good news, will he share his knowledge with us and tell us the names of the authorities?
Mr. Younger: As I have said, I will get the fullest details and make them available to hon. Members.
We have made substantial efforts in central Government to reduce expenditure and to eliminate the inefficiencies which are here and there to be found. I hope that the whole House will accept it as a genuine effort to try to help. The work begun by Lord Rayner — [Interruption]—on efficiency continues—
Mr. Donald Dewar: I am anxious to give the right hon. Gentleman the opportunity to receive the information which has evidently reached his junior Minister. Therefore, I rise on a point of information and urge the Secretary of State to let us have the information which has reached his underling. Will he now read to the House the information that is available?
Mr. Younger: I now have some advice which will perhaps help the House. The increase in rate support grant that I mentioned of about £17·5 million for 1983–84—which applies in Cunninghame, South as well as everywhere else — is to be shared among the Central, Fife, Strathclyde and Tayside regional councils, and among the district councils of Falkirk, Wigtown, Banff, Kincardine, Inverness, Lochaber, Nairn, Bearsden, Motherwell and Dundee.
The four authorities to which I referred—and about which the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) was so anxious in his non-political intervention—are Central and Strathclyde regions and Lochaber and Nairn district councils. I shall be glad to try to provide any further details that are required.
The work begun by Lord Rayner on efficiency is also important in the present context. In the Scottish Office, for example, manpower has been cut by over 14 per cent. since 1979, mainly by staff savings. The annual increase in the level of the Department's administrative costs is now well below the rate of inflation. More fundamentally, we have mounted a concerted programme—known as the financial management initiative—to relate costs to objectives and identified responsibilities, using modern information systems. That will not only lead to improvements in efficiency in the way that central Government runs, but will equip Departments to get better value for money from their programme expenditure on all the services that they exist to deliver.
I know that many local authorities have similar arrangements designed to improve efficiency. However, I cannot accept that all possible savings have been made when I read the reports of the Comptroller of Audit. Those reports refer to many areas where value for money studies in individual authorities have been able to identify useful savings and point to areas, such as budgetary control,
580
where many authorities fall short and could get better value for money. Local authorities are not unique in that respect. It is an area to which both central and local Government have to pay close attention. I hope that local authorities will see the pursuit of efficiency as an obvious course to follow at any time, particularly now when we are anxious to reduce the burden of public expenditure.
Looking ahead, we have now issued the guidelines for 1985–86. The convention told me that, taking its 1984–85 budgets and projecting them forward in 1985–86, it considered that there would be a gap of £200 million between its expenditure figure and the Government's plans. I have responded by increasing provision by about £95 million and, in effect, halving that gap.
On present inflation assumptions, I am looking for local authorities to reduce their expenditure by 3·7 per cent. from their present budgeted level of spending. A more realistic way to look at what is being asked of local authorities is to look at their actual expenditure for the year just ended and project it forward, making the necessary allowance for inflation. On that basis we are asking authorities to reduce their expenditure by about 2 per cent. in real terms. Bearing in mind what I said about the scope for efficiency savings, I do not think that that can be said by anyone to be asking the impossible.
I should like to conclude by returning to the order. Its purpose is simple.
Dr. M. S. Miller: How did the right hon. Gentleman come to the decision to ask for a reduction of 2 per cent. overall when there is a wide variation in what is necessary between one area and another? Even if he is right in asking for a 2 per cent. reduction—which I doubt very much—he must surely allow for spending very much less in some areas and for spending more in some other areas.
Mr. Younger: The hon. Gentleman is right. That is what the guidelines and the rate support grant arrangements are designed to do.
The purpose of the order is simple. It reduces by £90 million the total of rate support grant fixed for 1984–85 in the rate support grant order that we debated in January of this year. That reduction of £90 million falls entirely on the needs element of the grant, and is allocated among authorities in direct proportion to their excess over guidelines. Annex 1 to the report on the order lists the 115 authorities whose grant as initially notified for 1984–8,5, is not affected by the order as their planned expenditure is on or within their guideline. Annex 2 to the report sets out the formula, together with all of the necessary figures, that has been used to calculate the shares of the abatement of the remaining 50 authorities. The formula takes account of both the amount in cash by which the budget of each authority exceeds its guideline and the percentage represented by that excess. The allocation of the abatement is shown in column (7) of annex 2, while schedule 2 to the order sets out the amounts of needs grant in payment to each authority where appropriate taking account of the abatement — [HON. MEMBERS: "Where?"]. That is in annex 2 in the report on the Rate Support Grant (Scotland) (No. 2) Order 1984. It is document No. 581 and annex 2 includes a table on the back page. I do not know whether Opposition Members have it, but it is available in the Vote Office.
I emphasise that the calculations that I mentioned will be reviewed in the light of actual expenditure of authorities

581
for 1984–85, which will be known in about a year's time. If an authority brings its expenditure down to its guideline level, the grant penalty will be cancelled. If it reduces its expenditure, but not as far as its guideline, its penalty will be reduced. The new penalty will be based on the tariff established in the initial distribution of the grant penalty. Thus, if an authority reduces its overspend from 5 per cent. at budget stage to 1 per cent at outturn, its penalty will be reduced from 78 per cent. of its overspending in cash at budget stage to 65 per cent. of the lower overspending in cash at outturn stage. Any adjustments to grant will be made during the year ending 31 March 1986. That will recognise not only the lower cash overspend but the lower percentage overspend. As I have already said, if authorities make the effort to find savings, as they have done in response to previous general abatements, there is no reason why these individual penalties should not be substantially reduced and as a consequence the figure of £90 million will come down substantially.
The order sets severe penalties for overspending but it offers very real incentives to authorities to make savings and look for the most efficient way to provide services within necessarily limited resources.
Mr. James Wallace: On a point of order, Mr. Deputy Speaker. I have just been to the Vote Office and asked for a copy of the order. My copy contains schedules 1 and 2, but there is not the annex referred to by the Secretary of State. The hon. Member for Falkirk, East (Mr. Ewing) and I were told that the Vote Office had no knowledge of any document with an annex.
Mr. Deputy Speaker: The House would recognise that doubtless that was a slip of the tongue on the part of the Secretary of State. The House is debating the Rate Support Grant (Scotland) (No. 2) Order 1984, which has schedules to it.
Mr. Harry Ewing: Further to that point of order, Mr. Deputy Speaker. The point is that once documents have been referred to, they should be made available to hon. Members. When the hon. Member for Orkney and Shetland (Mr. Wallace) and I went to the Vote Office, the clerk told us that he had never heard of such a document. Whether or not it was a slip of the tongue, the Secretary of State referred to annexes 1 and 2, but no such documents are available to hon. Members. They should have been available before the debate.
Mr. Deputy Speaker: The Order Paper states that the House is debating—and the Secretary of State in my hearing moved that it be approved—the Rate Support Grant (Scotland) (No. 2) Order 1984. Is the hon. Member for Falkirk, East (Mr. Ewing) saying that that order is not available in the Vote Office?
Mr. Ewing: No. I should like to clear up the point. The Secretary of State said that there was another document as well as the order, which was a part of the order, naming the local authorities involved in the order. That other document is simply not available.
Mr. Deputy Speaker: That is different from what I heard the Secretary of State say. Perhaps the right hon. Gentleman will clarify matters.
Mr. Younger: I clearly referred to the report, to which there are two annexes. Copies are available and can be read——
Mr. William McKelvey: On a point of order, Mr. Deputy Speaker. The Vote Office has said that it had only seven copies and has sent for more.
Mr. Younger: I would always do anything that I could to ensure that hon. Members had the right papers. I think that they have. I strongly suspect——
Mr. Bruce Millan: On a point of order, Mr. Deputy Speaker. It is a well established convention in the House that, particularly when a basic document for a debate is referred to by a Minister, it must be available in the Vote Office. My hon. Friend the Member for Kilmarnock and Loudoun (Mr. McKelvey) said that there are seven copies of the document in the Vote Office——
Mr. McKelvey: There were.
Mr. Millan: That must be a breach of that convention. I understand that it is the responsibility of the appropriate Minister and his Department to see that documents are placed in the Vote Office.
Mr. Deputy Speaker: I understand that if a Minister refers to a public document, it should be available. The right hon. Member for Glasgow, Govan (Mr. Millan) has said that, no matter what the number of copies, such documents should be available. The number and placement of documents is a matter for Ministers and not for me.
Mr. Millan: Is it in accordance with the traditions and conventions of the House, in which there are 650 Members, for there to be seven copies of a basic document in the Vote Office? There are 72 Scottish Members. That simply cannot be good enough. We expect a bit of protection from the Chair.
Mr. Deputy Speaker: The right hon. Gentleman has been a Member of the House for a long time—longer than I have. He knows that there is no requirement in Standing Orders or in the procedures of the House that copies of every document to which Ministers refer should be available to every hon. Member. We should get on with the debate.
Mr. Albert McQuarrie: On a point of order, Mr. Deputy Speaker. I wonder whether I could clarify the position. I have obtained—
Mr. Deputy Speaker: Order. If the hon. Gentleman is rising on a point of order, it should be a point of order. Clarification has already been provided. We should get on.
Mr. McQuarrie: Further to that point of order, Mr. Deputy Speaker. I should like to refer to the point of order raised by the right hon. Member for Glasgow, Govan (Mr. Millan), who said that no copies were available. Further copies are being brought to the Vote Office at the moment, and I have obtained one.
Mr. Younger: I try to ensure that documents are properly provided. A report and an order are issued every year and this year 100 copies were made available to the Vote Office. It is clear from this exchange that Opposition Members were not able to go to the Vote Office earlier to

583
obtain their copies. They might think it wise to obtain documents before taking part in a debate, but I shall make sure that there is nothing lacking in what is available.
That brings me to the point that I was making earlier about the attitude taken by some authorities towards spending policies. I feel that on that matter the hon. Member for Glasgow, Garscadden (Mr. Dewar) is on the spot. I fully appreciate that he may well disagree with the order and the spending policies that we are pursuing. He has every right to do so and no doubt he will make that clear. However, there is a further, larger issue behind this that the hon. Gentleman cannot dodge and on which the House will require a clear answer from him today.
Some authorities have been saying openly not merely that they are against cutting their expenditure but that they are prepared to break the law passed by Parliament. Both the recent Labour party conference and the Scottish executive of the Labour party have made it clear that they would support such action. The hon. Member for Garscadden is the parliamentary leader of the Opposition in Scotland and has always been an upholder of the law, even when he may not have fully agreed with it. I call upon him today to say clearly and unequivocally where he stands on the issue of breaking the law. There are two questions that he must answer. First, is he, as a democratic politician, clearly in support of compliance with the law as passed by Parliament? Secondly, will he give here a strong lead to those Scottish local authorities which resolve to break the law that they should not do so and that he will give them no support if they do?
I understand that the hon. Gentleman hopes to get into the shadow Cabinet later this week. We in the Conservative party certainly wish him well in that. But if he ever wishes to be in a Cabinet as opposed to a shadow Cabinet, he will have to be able to answer yes to both the questions that I have asked or to forfeit a great deal of his claim to be a credible parliamentary leader. I commend the order to the House.
5.20 pm
Mr. Donald Dewar: I am overcome by emotion at the good wishes of the Secretary of State for Scotland. A touch of incompetence certainly adds interest to a speech. Almost every Labour Member was particularly pleased to see the hon. Member for Moray (Mr. Pollock) earning his corn on this occasion. We sometimes tend to forget that he is an important part of the ministerial team.
I have listened to many speeches by the Secretary of State. Some of my hon. Friends may be familiar with the memoirs of Mr. Claud Cockburn, who used to recount that in his days at the London Times there was a competition to find who could produce a headline that was most anticlimactic. One weekly succeeded with "Small earthquake in Chile: few dead". Over the years, listening to the right hon. Gentleman's speeches one notices that they have been carefully constructed on a similar principle. They tend to be featureless, undistinguished and rather prosaic in style. Occasionally they might rise to the heights of being neat, tidy and well read, but they are eminently forgettable. But if one looks behind the rather dreich presentation there are some serious messages for local government in Scotland and some depressing messages for the body politic north of the border.
The order is a pretty miserable business. It is another round in the bruising battle that has been going on for some
584
time between local and central Government. Today we have been reminded that the situation is bad and is likely to get worse.
Because I like looking on the bright side of things I want to start with the one bit of good news that the Secretary of State was able to bring. It is more a crumb of comfort than anything else. I am glad that there will be a reduction in the 1983–84 clawback for individual authorities in line with their outturn figures at the end of the financial year. If the £45 million, which was already put in as a clawback figure and which we were told was as immutable as the laws of the Medes and the Persians, had held, the situation would have been greatly distorted and the Secretary of State has tacitly accepted that.
For example, if, as would have happened, Strathclyde had been held to its £13 million contribution to the total, Highland and Lothian would have had an enormous burden to bear. As I understand it, the district councils would have had to find almost £15 million of the total. That proportion would have been about 33 per cent. compared with the 11 per cent. which was originally anticipated. I am glad that the Secretary of State has moved on that point. He was asked to do so originally by Labour Members when the Bill was being debated because we were worried about that point. When the statement announcing the £45 million came out we pressed him again. The Confederation of Scottish Local Authorities has been hammering on the door throughout the negotiations. I am grateful that at the end of the day the right hon. Gentleman has capitulated on that point and recognised the manifest absurdity of the position in which his plans have put him. I can only express the heartfelt hope that this is something of a precedent and that he will look at some of the distortions and foolishness that will arise from other parts of his policy and, equally wisely, retreat from the brink of confrontation.
The clawback for 1984–85 was a concession for a previous year. In this order, we are being invited to agree that £90 million in general abatement shall be filched from an inadequate settlement and that it should be done well into the financial year. We have every right to be angry and upset about that. More importantly, local government has every right to be angry and upset. Let me briefly remind the House of the basis for that discontent.
First, the system is based On a flawed foundation. We know, and we hear it constantly from Ministers, that local authorities are in excess of their guidelines. That is the litany mumbled by Ministers to justify every tyranny invented by the Treasury. But that is only a valid point if we assume that the guidelines have validity, are fair and are based on some genuine agreement on the methodology and the ultimate result. No one in Scotland thinks—or almost no one because there is a gaggle of time servers behind the right hon. Gentleman who may—that the guidelines are fair and defensible. The very word "guidelines" has now become something of an abuse of the English language because they are mandatory. There is no shadow of a doubt about that. Anyone who reads the famous report, about which there was an exchange a few minutes ago, will know that when we talk about the guidance on which the machinery depends, it is clear that it means the guidelines. We are building upon the flawed foundation a penal system which is completely misconceived.
The Secretary of State has said that he believes that the 1984–85 guidelines were reasonable. In a sense, he

585
admitted that they are not when he introduced the 1985–86 guidelines only a week or two ago. On that occasion he said;
"I have made a significant response to comments made by the Convention. My aim has been to provide a realistic total for 1985–86, which all local authorities should be able to meet."
There might be an argument about that. Some hon. Members might well think that an increase in the 1985–86 guidelines of 4·9 per cent. which, as the Minister agreed, is a cut in real terms because inflation is likely to be above that is a rather strange definition of the word "realistic", given the increasing burdens and needs that local authorities have to face and service.
Leaving that aside, if the Minister is boasting that he has produced reasonable guidelines for 1985–86, by inference, I presume that those for 1984–85 were not reasonable. That is the basis of the local authorities' case. The basis of the whole crazy structure is wrong. Therefore there is no justification for the penalties which have been assessed and imposed on the basis of those guidelines.
The second fundamental objection that we have been given—again the House will be familiar with this—is that local government expenditure is out of control. However, I do not believe that that is so. The Secretary of State's own figures cannot justify that point. In a parliamentary answer given to me on 27 July 1984 it was shown that local government expenditure in Scotland in 1980–81 and following through to 1984–85, was down in real terms—marginally, but it is down in real terms. I agree that I am taking the figures for 1980–81. One gets a slightly different result by going back to 1978–79, as the Secretary of State did. But if the urban programme and the interest on current revenue balances are excluded by the Secretary of State from his calculations as they now have been after a long argument, that drop over the past four years would be significant. Therefore, the argument that is in many ways the basis of the Secretary of State's case that local government expenditure is a runaway train and that there is profligacy and irresponsibility—those are the terms that are often used—cannot be justified.
A parliamentary reply to me dated 30 June 1983, shows that if one takes the figures for 1979–80 through to 1983–84 the expenditure in real terms on services in my district council of Glasgow—excluding the distorting effect of interest on current revenue balances—was for 1979–80, £82·27 million and for 1983–84, £82·92 million. If that is projected to 1984–85 there will be a downturn. I do not take the view that we should be proud of that, but it is a fact that must be made clear. It gives the lie to the bunkum so often mouthed by Ministers, who suggest that local authorities have been in some way irresponsible. My case is even stronger when one considers central Government spending and the transfer of functions from central to local government.
Much of the campaigning done by Conservative apologists is conducted in a welter of hypocrisy. We are often told that all this is in the interests of the ratepayer. But, of course, the ratepayer has been put under strain, and services have inevitably deteriorated under the Government's attack because the element of central Government grant-borne expenditure within local authorities' total expenditure has dropped dramatically. For example, between 1980–81 and 1984–85 the
586
proportion of the city of Glasgow's expenditure that is grant-borne by central Government — excluding the housing benefit that came in during that period —dropped from 41 to 29 per cent. I cannot give an exact figure, but if that was maintained it would probably be the equivalent of about 20p in the pound on the rates.
When the Government cut their contribution as they have been doing, services suffer, or if authorities try to maintain services — and there is a duty to provide a decent and humane level — the strain falls on the ratepayers. They pay more and get less. That has been the continuing slogan of this Conservative Government. This rather unpleasant and nasty squeeze has hypocritically been justified as being in the interests of the victims—the ratepayers.
Mr. Michael Forsyth: If the hon. Gentleman's argument is correct, why were there 30 per cent. rate increases in 1981–82 when the rate support grant remained constant?
Mr. Dewar: I am merely trying to point out that when the RSG and housing support grant element constantly drop, only two things can be done. Even the perverted logic and the ingenious minds of Conservative Members will not allow them to get out of that. Either services can be murdered or rates can be pushed up. There is no other way out. That is exactly what has been happening and that is presumably the intention behind the Government's policy. It is certainly its result, and the hon. Gentleman should accept that. The £90 million total is important, and surely the hon. Gentleman will accept that that is far too much.
If the clawback is taken as a percentage of the budget excess, the figure for England is 54 per cent. and for Wales 66 per cent. Yet in Scotland, 79 per cent. of the excess is being clawed back. Let us make a comparison with the last two years. In 1982–83, if the section 5 clawback and the general abatement are taken together it means that £57 million has been taken by the Government out of an excess of £203 million. That is 28 per cent. In 1983–84, the figures are £64 million out of £121 million, which is 53 per cent. So the figures run from 28 per cent. to 53 per cent. and, this year, to 79 per cent.
The depressing thing is that more of the same misery is promised for next year in the recent letter sent to convenors by the Secretary of State. Let us consider that £90 million clawback. The RSG payable will fall from 60·2 per cent. of relevant expenditure to 57·4 per cent. as a result of the clawback if the whole £90 million is taken at the end of the year. However, I accept that we do not know whether it will be taken. I know that Ministers will dispute my next point, but for many authorities the savings cannot be made within the fag end of this financial year without damage to the core of services.
Tories may think that I have a prejudiced view, but I refer them to the many press statements made by the leaders of the Tory majority group on Lothian region council, and particularly by Councillor Brian Meek. He has made it abundantly clear that he cannot meet that target and was not elected to cut essential services. That is a fair position to adopt even, and perhaps particularly, for a Conservative councillor. The policies being pursued have very few friends, and the Minister should accept that.
There is another aspect that I take very seriously, and judging by his closing remarks, the Secretary of State does

587
too. There is a danger that we are set on a collision course. I shall not be so confident as to say that Ministers glory in that. However, there is an element of smugness and complacency, and a certain lack of comprehension about what is happening. I believe that local democracy is at risk, and the Secretary of State's remarks about the absurd antics of councils that put forward that point of view were unwise, and underestimated the problem. When I say that there is a risk, it should not be shrugged off as some sort of ritual exaggeration that almost always creeps into adversarial politics. There is a real danger in what is happening in this country, and if I am asked whether it is something that we should worry about, my answer is, "Yes, yes and yes again."
The order is, or course, bad enough but we know that there is a great deal more on the way. During the course of the coming financial year, we are likely to have section 5 procedures, as was made clear in the Secretary of State's letter to convenors. It will be tough and it will get tougher. If Glasgow has a standstill budget and merely allows for inflation but no increase of any kind, it will probably be 7 per cent. over its new guidelines. Is that unreasonable? Will that attract a penalty? Can we have a guarantee that only when there is a growth in real services will there be a danger, and that if there is no growth or a standstill or less, there will be safety for that local authority? [HON. MEMBERS: "Where is the Secretary of State?"] I understand that the Secretary of State has left the Chamber for a television engagement. He did have the courtesy to tell me——
Mr. Norman Buchan: On a point of order, Mr. Deputy Speaker. This debate is very serious for the whole of Scotland and for the Secretary of State, who is not only a party politician but a representative of the Government, to leave the Chamber for a television interview is an insult to the Chair as well as to hon. Members.
Mr. Deputy Speaker: The hon. Gentleman knows that that is not a matter for me.
Mr. Dewar: I was asking for some assurance from the Government that an authority with a no-growth budget next year would not be punished under the section 5 procedures. In Lothian, the cut demanded is £16 million. I understand that the Tory group hopes to save about £8 million. Press reports state that that is
"a figure that would hopefully avoid selective action".
That may be a fond and faint hope, but perhaps the Minister can reassure his Conservative colleagues that if they reach that point, they will be safe from the sort of cuts threatened in the recent correspondence emanating from the Scottish Office.
Another very direct worry is the rate fund contribution limitation orders that are likely to come under section 1 of the Rating and Valuation (Amendment) (Scotland) Act 1984. This is the make-believe world of total unreality. The figures say that the rate fund contribution for Scotland will be cut from £99 million to £90 million. However, we know that last year it was £120 million, and thus a cut to £90 million means a drastic reduction which will bring hardship for many tenants.
Glasgow is the biggest housing authority, where there will be a reduction from £35 million to £26 million, and on the assumption of an HSG of roughly the amount that we expect, an increase in rents of about 25 per cent. I
588
object to this machinery in principle, but more importantly, it is daft in practical terms. If the Minister holds to that course, he will be inviting—some will think that he will be demanding and almost forcing—the confrontation that none of us wants. I should make it perfectly clear to him that we do not seek such a confrontation and do not wish for it. If it comes, it will be to our deep regret, and will be the result of his obstinacy and the misconceived way in which he has pursued his policies.
The tragedy lies in the insensitivity of Ministers. In Glasgow the Minister has boasted that he no longer uses cuts in the HRA as a rent regulator. The Minister looks puzzled, but that is the system from which the Minister intends to depart under rate fund limitation directives. In Glasgow this year blackmail has been replaced by direct dictation. When an authority has had to deal with serious problems connected with asbestos or dampness and has asked for the transfer of money from the non-HRA funds to HRA funds it has run into difficulty with the Minister who says that that is possible only at the expense of increases in rents. That is unfair and dangerous.
The Under-Secretary of State for Scotland (Mr. Michael Ancram): Earlier this year, when Glasgow district council decided, by putting its rate fund contribution above the set limits, deliberately to forfeit £5.·5 million of its capital allocation, I said that that was money that could have been spent on important problems such as housing and dampness. I did not hear the hon. Gentleman at that time suggest that that capital should be spent as intended instead of subsidising rents at the expense of ratepayers. Perhaps the hon. Gentleman would like now to consider what Glasgow district council decided last February, recall that I have offered it the chance to review that decision, and advise it to do so.
Mr. Dewar: The Minister is dodging the point. There is something immoral in saying that it is necessary to spend money on essential repairs which may involve health, such as work on asbestos, but that that money cannot be spent unless the council capitulates to the Government on rent levels. There is a case for allowing a switch from an HRA ceiling of £46 million to a non-HRA ceiling of over £80 million. There is a case in terms of democratic choice because. such a switch would not increase the total spent, but merely affect the distribution of that total. There is also a case in terms of housing need. The present position is ludicrous and unacceptable and I am sure that the Minister would admit that in private.
Rate-capping is a joy to come in 1986–87. Labour Members are not starry-eyed about councils or councillors, but we feel deeply about the right of communities to run their own affairs, elect their own representatives and to call them to account at the ballot box. We do not like what might happen soon. All the statutory machinery has been enacted to allow the Scottish Office to dictate on rents, rates and the pattern of spending. Discretion, judgment and responsibility for major policy decisions are being squeezed out by Ministers and St. Andrew's house. If that continues nothing will remain but a shadow, an apology, for what local democracy used to be and should be.
The Minister may think that I am over-stating the case. I remind him of what The Scotsman said on 9 October in a leader headed "Last Rites". The Scotsman does not always back Labour and we certainly cannot count upon it for support. The leader said:

589
"Stripped of their independence, their judgment and their discretion the authorities, the councilors and their officials have little with which to challenge the Minister's ruling but their requiem for the passing of local democracy."
That is a gloomy statement from a responsible newspaper. We hope that that will not happen. We shall argue the case. We shall go to the electorate and win—when we get the chance.
We had a judgment on what the Conservatives are doing at the district council elections in May. That is why in Edinburgh a Labour council is in control. Some day the Under-Secretary, who represents an Edinburgh constituency, will have to face the electorate. In the meantime, as we watch the storm clouds gathering, we are entitled to say that Ministers must listen to what Scotland is saying and not take their present inflexible, obstinate, unthrawn position. If they do not listen, they will undermine the democratic system and put it under a strain which is more damaging and more certain than the strain created by the activities of any determined rebel on the extreme Left.
I believe that we are in danger. The danger goes beyond the normal dispute and tension between local and central Government. We are watching something much more serious. I hope that the Secretary of State will think again before we reach confrontation. We shall be delighted to encourage him. We shall mark our protest against the new intolerance that has developed over the last few years by voting against the order tonight.
5.45 pm
Mr. Donald Stewart: In December 1983 the Secretary of State announced that rates could be cut by 5 per cent. or 6 per cent. if the Scottish councils accepted his financial package. Simultaneously, COSLA announced that it was much more likely the rates would rise by the same amount. Indeed, by March 1984 the figures showed that rates had risen by 5·4 per cent.
Local authorities had rightly chosen to ignore the Secretary of State's diktat that they should run their financial affairs as he planned. As COSLA said, compliance with his plans would have meant 8,000 or 9,000 redundancies. Some authorities, of course, gave in under the threat of punitive action. A £90 million clawback was announced in July, which will hit all but 15 councils in Scotland because, in the Secretary of State's view, they have overspent.
The £90 million figure represents 79 per cent. of the total—£114 million—by which the Secretary of State considers that Scottish councils have overspent. In England, the relative percentage clawback is only 66 per cent. and in Wales only 54 per cent. Scotland is not only being penalised by the Government, but it has been singled out for the harshest treatment.
There is more. Any council which has been penalised by the Government through a reduction in rate support grant and which subsequently tries to make up for lost revenue by raising the domestic rate is liable to be clobbered again by the Secretary of State wielding his rate-capping powers.
Scotland's local authorities have been hamstrung. They have nowhere to turn and no means left by which to assert financial autonomy. If the Government do not approve of a council's spending plans or its political outlook it had better watch out.
590
Not only have this Government attacked local authorities. In 1975–76, under Labour, rate support grant accounted for 75 per cent. of all council spending in Scotland. By 1977–78 that had been reduced — by Labour—to only 68·5 per cent. By 1983–84—under the Tories—it was down to 61·7 per cent. and this year it is barely over 60 per cent.
It is a pity that the Tories have not kept their election pledge to reform local government finance. In the short term that would have been the only way in which Scottish councils could have looked forward to a system which allowed them financial autonomy after a decade of seeing that autonomy whittled away by successive Labour and Tory Governments.
In the longer term the solution is more fundamentally political. It is for Scotland to sever links with Whitehall and Westminster. With Scottish independence there would be no need for the kind of treatment that a bankrupt British Government are inflicting on our local authorities. With Scottish oil there would be no need for that at all. [Interruption.] Government Members should not make too much of that in view of how thinly populated their Benches are tonight.
The Western Isles council has its own particular problems. It is unique. It is the only wholly new authority created by local government reorganisation. It inherited a legacy of deprivation, especially in those islands previously administered from Inverness-shire. In no single area did housing stock reach 30 per cent. of tolerable standards. Children from Uist and Barra who passed the 11-plus examination were transferred to one of 23 secondary schools on the mainland. Some primary schools had neither toilets nor running water. The highways network of 700 miles was almost completely single track. There was only one sheltered housing complex and there was no provision for the mentally handicapped.
That was the base from which my local authority had to work. There was a long history of neglect, and the mark of the council's achievements is that the population decline, which had continued since the 19th century, has ended.
However, the council, far from being able to continue with improvements, cannot even meet the costs of maintaining existing services. It has the lowest rating base in Scotland, which means that most of its income comes from central Government in rate support grant. Thus, the council receives proportionally more grant than any other local authority in Scotland, but the reverse of that is that the council is therefore the most vulnerable to cuts in rate support grant and is the area which can least stand such cuts.
Because of loss of grant, the council has had to lop £2·25 million from its budget so that it can contain rate increases. The results of those cuts are that it is the only council in Scotland with no nursery schools and it is the lowest spender in Scotland on supplies and services for schools and on leisure, recreation and libraries. It has the highest rate in Scotland, the second highest council rents and the highest rate fund contribution towards housing expenditure. Average rates in the Western Isles have increased since 1977 by 262 per cent., against an average for Scotland as a whole of exactly half that.
The problem facing the council for 1985–86 is that it cannot afford even to spend anywhere near the guidelines

591
laid down by the Secretary of State. It cannot afford to spend what even this Government think is necessary to maintain services.
The only solution is more Government grant, and there are two ways to achieve that. The first is to speed up the introduction of a new method of rate support grant distribution. Secondly, the council is looking for recognition from other local authorities and from the Government that it is a special case and that, accordingly, it needs special treatment.
5.52 pm
Mr. Tom Clarke: I assure the right hon. Member for Western Isles (Mr. Stewart) that I listened carefully to his speech and I am sure that he will not accuse me of being personally offensive if I say that I should prefer to concentrate on the general approach that the Government are asking the House to endorse. I wish to relate that approach to the severe headaches that are being caused to local authorities throughout Scotland. Like other hon. Members, I served in local government for some time. It seems to me that the major problem facing local authorities is that the Government are changing the rules so often that it is difficult for councils to anticipate what the Government expect them to do when they draw up their budgets.
Local authorities want to provide a service for their communities which rightly expect the best. Councils do their utmost to keep their services, including education, roads, housing, leisure and recreation, at a standard that they regard as reasonable, but they get bogged down because of the unreasonable demands that are placed on them when the Government change the rules so frequently.
The problem confronting local authorities was predicted when the House debated the previous rate support grant order. Councils cannot be regarded as islands in the national economy. They have to deal with the rate of inflation, cost increases, wage settlements and so on. The rate support grant order does not reflect the realities of life.
There has been a dramatic reduction in the real level of the Government's contribution. Conservative Members deny that, but we must face facts. Like other hon. Members, I have received correspondence virtually daily from local authorities and other interested parties about the decline in services and the overwhelming demands that local authorities have to meet.
I do not apologise for mentioning the two district councils in my constituency — Monklands and Strathkelvin. I expect support from the hon. Member for Strathkelvin and Bearsden (Mr. Hirst).
Mr. John Home Robertson: Where is he?
Mr. Clarke: I am sure that the district council has ensured that the hon. Member for Strathkelvin and Bearsden is as familiar with its problems as I am.
Strathkelvin district council faces increasing rates, demands to raise its rents and increasing unemployment. The director of finance wrote to me recently:
"Rating Review published by C.I.P.F.A.… shows that our rents for the current year at £553·58 are higher than the national average of £547·26 and that our expenditure per house is less than the national average at £770·65 compared with £778·55.
We do not receive Rate Support Grant and although quite clearly other income comes into the calculations, it is an inequitable situation which we appear to be in if the figures of
592
rent above are correct. If the situation had occurred in the current financial year on a 52 week cycle we would have been talking about £1·76 of a rent increase in addition to the rent increase already applied. One wonders how this compares with the Secretary of State's average figure of rent increase of £1 … it does seem ridiculous that we are consulting with non domestic ratepayers prior to receiving figures for Rate Support Grant which will not be available until some considerable time."
I have quoted that letter at length because I believe that the district council, in common with others of all political persuasions, is experiencing a most traumatic time. I invite sympathy and support from the Secretary of State and his ministerial team. So far, such sympathy and support have not been evident.
My right hon. and learned Friend the Member for Monklands, East (Mr. Smith) and I led a delegation that met the Under-Secretary. We felt that we were entitled to take the view that our area suffered from many grave problems. Youngsters leaving school have no prospect of employment and jobs in the construction industry are few and far between, yet grave problems, such as dampness, affect the housing stock. Surely there is a case for capital investment in my constituency and other constituencies with similar problems.
Would it not be better to give local authorities the money that they need to carry out their plans for improving the environment than to hand out money to people on the dole queue, especially when those people do not want to be on the dole queue? The Minister gave us a charming reception, and no one could complain about his manner — [Interruption.] The people of my constituency are understanding —perhaps more understanding than they should be. We did not get our reward. We did not get the money that we need to provide the services.
Only a few weeks later, in reply to a question from an hon. Member representing an English constituency, the Minister rebuked my authority for not selling council houses at the speed that he was demanding. As hon. Members can ask only supplementary questions on such occasions, I was unable to respond to the Minister. The Government recognise that the administration of the sale of council houses is a matter for the local councils. My district council, although opposed to the policy, is attempting to implement it. If a council does not have the manpower to give priority to the sale of council houses, and with the Government already saying that too many people are employed, it is unforgivable for the Minister to say that we cannot solve the problems of dampness, bad housing and the need to build houses for the elderly because he believes the council to be slow in its sale of council houses.
Mr. Ancram: I have listened carefully to the hon. Gentleman's remarks about the need for capital expenditure, especially in public sector housing in his constituency. No doubt he will confirm that he will encourage his district council to sell as many council houses as possible so that it can use the receipts to deal with the problems to which he referred.
Mr. Clarke: The Minister well knows that even if Monklands district council disregarded all the other demands from the Government about its statutory duties towards the environment, health and so on, and decided that the most important issue was the sale of council houses, that would represent only a fleabite in solving the district's housing problems.

593
Other services dealt with in the order are also of great concern to local authorities. Some hon. Members met briefly today representatives of the teaching profession. The Government's attitude to industrial relations has been made clear in many areas. I have received representations from many parents and teachers and, having heard their arguments, can say quite candidly that the problem has been caused because the Government are not prepared to provide the necessary resources. The conflict in the teaching profession — almost between teachers and parents—will be reflected elsewhere. I regret that it is indicative of the Government's appalling approach to industrial relations in all aspects of local government.
The Government should have presented an order which fully recognised the real needs of local authorities and the services that people want. Yet again this evening we see a mean-minded and unacceptable approach. Ministers and Conservative Members spent many weeks in the summer appealing for people to respond to the problems caused by the drought, yet regional councils have time and again pointed out the problems of the out-of-date Victorian sewerage system and said that more capital is needed for reservoirs. It is appalling that a limited period of drought should lead to such appeals from the Government. I hope that there will be no such crocodile tears next year or in the following years when local authorities have said that they cannot cope with the problem unless the resources are provided.
I make no apology for saying that whereas the Government view the problem of unemployment as being quite detached from their other objectives, such as their economic policy and their controls on local government, I view it as absolutely central to what I hope will be the approach of Parliament and other elected institutions—that they will do their utmost to remove the blight of unemployment. I hope that when my hon. Friends assume Government and sit on the Treasury Bench, rather than apologising for the local authorities that are trying to provide employment, they will ensure adequate education facilities, deal with urban deprivation, ensure that there are sufficient home helps and cope with the problems of the elderly and the young. I hope that they will reassert the democratic role of local government in Scotland and that there will be a major drive to achieve full employment. That will be a real achievement for Scottish local government.
6.8 pm
Sir Hector Monro: I apologise to the hon. Member for Glasgow, Garscadden (Mr. Dewar) for having missed his speech. I welcome the order——
Mr. Buchan: Why?
Sir Hector Monro: The hon. Gentleman should wait and see. It is important to recognise that this order is a variation of the original order and makes a substantial change in favour of local authorities, which should be thankful that the consultations were constructive and led to a £90 million change. Indeed, the value of COSLA in the discussions with the Secretary of State has clearly been demonstrated. My right hon. Friend has made a substantial change that will benefit local authorities, and that should be welcomed by Opposition Members.
594
I understand that the hon. Member for Garscadden did not make it clear whether he is recommending that local authorities disobey the law. Will the hon. Gentleman be advising and encouraging local authorities to defy the law? One local authority in my area—Nithsdale—is hell-bent on doing so. That cannot be welcomed by any form of democracy in this country. A Left-wing Socialist councillor who was heavily defeated in a national election last year is steamrollering that council into defying the law. That is a disgrace to local government.
Mr. Ewing: The hon. Gentleman says that Nithsdale district council is hell-bent on defying the Government, but it is not included in the penalties laid down under the order.
Sir Hector Monro: The hon. Gentleman is always so impatient. He should wait to hear what I have to say. If he reads such distinguished newspapers as the Dumfries and Galloway Standard and the Dumfries Courier he will appreciate that Nithsdale council is prepared to spend substantially beyond the guidelines, irrespective of what the Secretary of State has to say. The order shows what it should be spending, not what it actually will spend, and I am surprised that the SNP and Socialist councillors there should gang up to defy the very reasonable guidelines set by the Secretary of State.
Mr. Dewar: As a distinguished and experienced Member, the hon. Gentleman will recognise that we are dealing with a general clawback for 1984–85. If he looks at the guidelines and the budget of Nithsdale district council he will see that that council is in credit. It will, thus, not be subject to any penalty in 1984–85 and is therefore not included in the penalties under consideration in this debate.
Sir Hector Monro: The hon. Member for Garscadden is talking about the 1984–85 order. I am forecasting what that council has already decided to do in the forthcoming year. That is extremely important for the future. Councils now preparing their budgets for the forthcoming year cannot be allowed to defy the law in the future. Ratepayers find it astonishing that district councils can do that and even vote substantial sums to the miners.
Since the war there has never been an easy period for local authority expenditure. No authority has ever had carte blanche to spend what it likes. Local authority expenditure has always been subject to public expenditure guidelines laid down by the Government. For 30 years or more, all councils have had to accept the principles of good housekeeping and the reduction of expenditure, which frequently means setting aside schemes on which they have been wishing to spend money for some time. The same applies today. The only difference is that, instead of the vast cuts referred to by the press and the Opposition, local authorities are spending 2·5 per cent. more in real terms than they were in 1978–79. It is thus quite wrong to suggest that there are substantial cuts in local authority spending.
It is essential that we try to keep local authority expenditure within bounds because upon that depends the level of rates, which has an important impact on employment and inflation. We should therefore support my right hon. Friend's genuine, practical and fair efforts to contain public expenditure. In my view, the attitude of the Opposition is indefensible, irrelevant and incomprehensible.

595
One is entitled, however, to consider the small print of any order and to raise matters of detail. I wish to raise a subject that I have raised many times in the past. Is the Minister absolutely confident that the very complicated formula is fair to both urban and rural areas? There is certainly considerable doubt in the rural areas as to whether the guidelines and grants provided for them are as generous as those provided for the more heavily populated areas.
Mr. Buchan: In the interests of his rural ratepayers, does the hon. Gentleman agree that it might be more useful for rural district councils if we re-rated agricultural land? Will the hon. Gentleman support that proposition in the interests of equity and fairness?
Sir Hector Monro: Certainly not. The hon. Gentleman knows as well as anyone that houses on agricultural land are rated in the same way as other houses in the area. It would be most unfair to introduce rating of agricultural land either now or in the future.
Mr. John Maxton: Why?
Sir Hector Monro: The farming community pays its full share to the local authority through the rating of the farm-houses on the property.
Mr. Buchan: But not the farm buildings.
Sir Hector Monro: The rates on the houses are the same as they are throughout the area. It is therefore entirely wrong and irrelevant to the debate to bring in the red herring of re-rating farm land.
Dumfries and Galloway is the only region in Scotland to have budgeted within the guidelines every year since 1975, despite additional financial pressures arising from new legislation, new capital projects, developments in education and demands for additional services. Nevertheless, it seems inevitable that the rates will rise beyond the rate of inflation due to reductions in grant and the non-availability of balances. In recent years some authorities have used their balances to contain annual rate increases but that period is coming to an end and we may have to accept increases 2 per cent. or 3 per cent. more than expected due to the lack of balances.
Is the Minister really confident that the new client group management scheme provided for in his formula will, in the next year or two, which I appreciate will be a transitional period, provide for the rural areas the benefits that he has forecast from time to time? At the moment I do not see how, without the use of balances, rates can be kept within the inflation guideline of 4·5 per cent. or so.
My hon. Friend the Parliamentary Under-Secretary of State was most helpful in meeting Nithsdale district council and the regional council in the summer and discussing matters with them, but I wonder whether he has given further thought to the possibility of rolling over balances—I know that there may be a problem with the Treasury — or to some of the other matters that were raised, such as the difficulties over improvement grants which have been a burning topic over the past year or so.
Annandale and Eskdale district council certainly appreciated the extra £100,000 that my hon. Friend was able to grant it this autumn. However, for the district council on a lower budget compared to the more populated areas, a small percentage change in expenditure has a
596
dramatic effect on rates. That must be borne in mind relative to the eventual rate, when all the balances have been taken into account.
The district councils are as concerned as the regions about the client group method and hope that the phasing-in will be as effective as my right hon. Friend believes. By and large, the message that the Government have to send out tonight is that unless we make a genuine effort in the direction of good housekeeping and keep public expenditure within bounds, there will be an increase in inflation with all its consequences. I believe that what the Government propose, while not entirely welcome to all local authorities, is, overall, in the best interests of us all. For that reason we must support it.
6.22 pm
Mr. Harry Ewing: I apologise to the hon. Member for Dumfries (Sir H. Monro) for my impatience, but I suspect that that impatience may have saved him from some embarrassment in his constituency. I am sure that he was under the impression that Nithsdale would exceed the spending guidelines already determined for 1984–85. It was against that background that the hon. Gentleman attacked a council which is in fact perfectly innocent. The hon. Gentleman believed that the council would break the law not in 1984–85 but in 1985–86. He should have kept his speech until the time of the next rate support grant in a year's time. No doubt we shall hear it again then. This has been a good rehearsal.
During the summer recess I saw in the Daily Record a photograph of the hon. Gentleman driving a bridal couple to their wedding in his vintage car. I thought to myself, "There is a man who has found his station in life." Nothing that the hon. Gentleman has said tonight has convinced me otherwise.
When the Secretary of State was making his opening speech I looked round the Chamber. It was noticeable that of all hon. Members present on the Government side only the Secretary of State and the hon. Member for Dumfries had been present when the current system of local government was introduced in 1972–73. Both of them were Under-Secretaries of State in the Scottish Office at that time, and both played a prominent part in the introduction of the two-tier structure of local government. That demonstrates how young is the system of local government in Scotland. If ever an organisation was about to be strangled at birth, it is that system of local government, which is not yet 10 years old. Elections to the district and regional councils look place in 1974, but the councils themselves did not come into being until 1975. The system is therefore only nine years old and has had no opportunity——
Mr. McKelvey: A disaster.
Mr. Ewing: My hon. Friend is entitled to his own opinion. He says that it is a disaster. I do not quite take that view. Much depends on the region or district in which one lives. If the Secretary of State—then an Under-Secretary—had accepted the advice of the Opposition and the amendments proposed by my right hon. Friend the Member for Glasgow, Govan (Mr. Millan), my hon. Friend would not have to raise objections now. In Committee my right hon. Friend the Member for Govan suggested a constructive amendment on the size of Strathclyde region, which I suspect is the origin of my hon. Friend's complaint.

597
The system of local government in Scotland is very youthful, and the Secretary of State and the Under-Secretary are going out of their way to stop it developing. The midwife who assisted at the birth of the system should give it more encouragement to grow than the right hon. Gentleman has done since he took office in 1979.
I also criticise the Minister with responsibility for local government, who made his name and based his career on attacking local government in Scotland. That may be why he has his present job.
Let us consider what has happened to the regional and district councils. The Government have assumed the right to fix the level of expenditure. Despite what the hon. Member for Dumfries has said, it is not true to say that local authorities have always been constrained by Government. Governments have always made their contribution through the rate support grant, and certainly Governments, including Labour Governments, have reduced the level of rate support grant. But Labour Governments have never dictated to local authorities the amount of revenue that they may raise through levying rates. That has always been left to the local authorities, and the check on the authorities has always been the electorate, whether through the old town council elections or, in recent years, the district and regional elections.
The Government are not prepared to accept the verdict of the ballot box. We are not prepared to take lectures from Ministers in New St. Andrew's house about democracy and breaking the law, because the Government are not prepared to accept democracy and the will of the ballot box when these matters have to be decided. It is only six months since elections were held in the 56 districts in Scotland. Those councils are not four years old. Those elections were contested long after the general election. They were contested on manifestos, and it is an insult to the electors of Scotland to suggest that they did not know what they were voting for. They deliberately voted out of office a Conservative administration in Edinburgh, and voted a Labour administration in for the first time in many years.
Mr. Michael Forsyth: What happened to the Labour party's commitment to local democracy in 1977, when the local authorities were forced to shed 9,000 members of staff and to cut considerably capital and revenue expenditure?
Mr. Ewing: The hon. Gentleman may refuse to take the point on board, but we did not in 1977 impose on local authorities the kind of restrictions that the present Government are imposing. I am listing those restrictions as quickly as I can. On the question of rates, the Government refuse to accept that it is the electorate that should be the check on whether local authorities have raised their rates too much—or too little. We should not forget that in some cases councils have been voted out of office because they would not spend money on much-needed projects. Councils do not lose elections only because they spend too much money. That is a myth. I have known of local authorities being voted out of office because they refused to spend on much needed projects. That is right. Such a decision should be left to the electorate rather than to mysterious people in New St. Andrew's house.
598
If the Secretary of State today displayed the competence of New St. Andrew's house, it is clear that it is worse placed to lecture Scottish local authorities on competence and efficiency. He was not properly briefed and did not know which authorities were being discussed. I blame not the people who are responsible for briefing the Secretary of State but the Secretary of State for his lack of interest in the welfare of Scottish local authorities. We did the Secretary of State a favour by delaying long enough to allow him to discover the name of the four local authorities. He left the Chamber to appear on television. I do not object to that but just imagine the interviewer asking him, "Which are the four local authorities?" and the Secretary of State replying, "I shall send Michael Ancram along at 10 o'clock to tell you." That is disgraceful. Moreover, the documents that we needed for the debate were not in the Vote Office and had to be sent for. There were only seven copies. The Scottish Office is in no position to lecture Scottish local authorities about efficiency and competence.
Having taken the power to dictate the level of rates in Scotland, the Government have now taken the power to dictate the level of rents. I object most strongly to the balance which the Government are imposing that means that local authorities must increase rents to cure dampness and to remove asbestos. That is insulting. George Burrell of the Daily Express recently accused greater Glasgow district council of being too interested in what he called ideologies such as removing dampness and asbestos from houses. The Minister nods assent. If that is ideology, I hope that we have much more of it. The Government are confronting councils by saying that to remove asbestos and dampness they must increase rents, and that failure to do so would involve breaking the law. Labour Members are then asked whether they are prepared to tell councils that they must not break the law. If the Government set up a confrontation, they must expect a confrontation. They will get such confrontation, which is of their making, not that of local authorities.
The powers to fix rate and rent levels have been taken away and the final insult is that local authorities must now consult non-elected bodies and non-domestic ratepayers such as the Confederation of British Industry and chambers of commerce about rate levels. If such bodies do not agree with the budget or with the level of rates, the matter must be referred to the Secretary of State who will decide what services there will be. He sits in New St Andrew's house, or lives in Gargunnock. How does he know what services my constituents need? Such stripping of power and undermining of local government in Scotland will precipitate the crisis that is undoubtedly coming nearer with each act of the Secretary of State and the Under-Secretary of State.
Under this order, Central region will lose £3 million and Falkirk district will lose £500,000—its share of the £90 million—because, the Secretary of State says, they are spending outside their guidelines, as if he had nothing to do with the matter and it was not his fault. We warned the Secretary of State and the Minister's predecessor—the hon. Member for Eastwood (Mr. Stewart), who now has responsibility for industry and education in Scotland—what would result from removing £8·5 million worth of rateable value from Central region and Falkirk district and rate income through the derating of outside plant and

599
machinery, thereby cutting their income. As a result, rates in Falkirk increased by 4p in the pound. The increase was similar in Central region.
With Central region's director of finance, John Broadfoot, Falkirk's director of finance, Bill Ramsay, the provost, John Docherty, and Charlie Sneddon, the vice-convenor of Central region, I went to see the Minister. He told us that the Government would not make good the £8·5 million shortfall because the level of rates per head of population in Central region and Falkirk district was higher than in any other part of Scotland and that if he did not give that £8·5 million the rates would be reduced to the same level as elsewhere. Far from being rewarded for good management, Central region and Falkirk district are being punished. Their problems are entirely the result of legislation that the Secretary of State put through at the request of British Petroleum and other industries that would benefit to the tune of £8·5 million. The Secretary of State is fully aware that he did not make good one penny piece of the shortfall.
I read in the Stirling Observer and the Falkirk Herald that the chief constable of Central region, Ian Oliver, went to the protective services committee where he learnt that, because of an obscure EEC directive, there must be major modifications in the communications system that Central Scotland police use. That will cost £3 million. On the basis of the Government contributing only 50 per cent. of the cost, are they saying that Central region ratepayers must provide the other £1·5 million? If not, I hope that they are saying that the Government will meet the full cost. Ratepayers in Central region and Falkirk district are becoming sick and tired of the Government introducing legislation and not compensating them accordingly.
My hon. Friend the Member for Monklands, West (Mr. Clarke) mentioned teachers. The present crisis in education arises from the Government refusing to inject money to take account of changes in the curriculum. I cannot understand why the Government pretend otherwise. They should be honest enough to tell the people of Scotland that they are not prepared to inject that money and that if they want the new system the new curriculum or changes in police communications systems they must pay. The Government's double standards are unacceptable.
The system of local government in Scotland is only nine years old. It is not good enough for the Minister to snigger at it. It is all right for him in his protected household, with the luxury of where he lives and his ability to buy the protection that he needs. I do not represent people such as him. I represent people who suffer unemployment, old folk who need home helps and children who need clothing to go to school. I represent not privileged people but those who need help. That help can come only from local government because the Government are not prepared to give it. I plead with the Government to leave Scottish local government alone and let it get on with the job that it was elected to do.
6.40 pm
Mr. Michael Forsyth: I hesitate to continue the analogy of the hon. Member for Falkirk, East (Mr. Ewing) of local government being a promising youth, because in some areas it has certainly turned delinquent. The issue in the debate is of fundamental importance. The notion of some Labour Members is that local government is a series of local fiefdoms which can ignore the fact that
600
the bulk of their money comes from central Government and most of the remainder from the business community which has no vote. [Interruption.] They do not have a vote for the expenditure that they contribute as commercial ratepayers.
The Government have a duty to protect the National Health Service and other essential services. I am sure that the hon. Member for Falkirk, East would be anxious about that when defending the intersts of his constituents from the ravages of unreasonable local authorities. The Government also have a duty to look after the needs of the business community because of the consequences for employment.
Some local authorities are spending far more than necessary, and we all know which they are. The hon. Member for Falkirk, East must know, as I know, that there are some such authorities, such as Stirling, which spent £30,000 on a lunch at which it explained what could be done if it could get money for the top of the town. It is embarking on a £100,000 PR project. Every £1 costs it an extra 85p. It has also voted £50,000 for Christmas lights. Those are not actions of authorities which are pared to the bone, or worried about the weak and vulnerable in the community.
During the recess I attended a meeting of Stirling district council, at which it voted £10,000 to set up a women's committee and at the same time complained about the shortage of resources. It also voted to limit competition in the provision of services by blacking those firms that had crossed miners' picket lines and all firms and organisations which were customers or associated with them. By doing so, it ensured that it would not get value for money in the placing of contracts. It is hell-bent on spending, regardless of the consequences. It is not the sort of authority that Labour Members are inclined to present.
I was grateful to receive the excellent briefing for the debate from COSLA. Its figures, which are no doubt in the annexe, are illuminating. They show clearly that COSLA has resorted to hiding behind the average. According to the figures, the best authority is underspent by 7·5 per cent., whereas the worst is overspent by 14 per cent. The prudent authorities are masking the irresponsibility of the less responsible authorities. That is according to overspending on the Government's guidelines.
I believe that the guidelines are unfair, because they are not based on need but are weighted in favour of the overspenders and against the underspenders. I find it increasingly difficult to justify the expenditure guidelines, not for the reasons given by Labour Members but because the client group method is biased towards increasing the guidelines for profligate authorities and penalising prudent authorities. Labour Members would do well to recognise that, instead of whining about the guidelines. Too many resources are given to profligate authorities. Tonight we should ask ourselves why the clawback is only £90 million and not £114 million.
Mr. Buchan: I should like the hon. Gentleman to get his semantics right. When he talks about prudent authorities, he seems to be considering their previous expenditure and not the needs of the district. Will he confirm that by prudent he means lower-spending and riot authorities which spend only according to their needs?
Mr. Forsyth: By prudent I mean those authorities which get value for money for their ratepayers. The hon.

601
Gentleman should not make the mistake of assuming that those authorities which spend most are providing the best services for the community. In Stirling, Falkirk and Perth the position is exactly the reverse. Some of the lowest-spending authorities provide the best value for money and the best standard of services. They concentrate on the provision of services, rather than on placating their trade union friends by ensuring the continuance of restrictive practices and overmanning.
Some Labour Members may feel that it is unreasonable to suggest that the Secretary of State should have clawed back the entire £114 million. I put that forward as a proposition because the clawback seems to be having precious little effect. We have listened to the usual barrage of extravagant scare stories. We have heard speeches, such as that of the hon. Member for Falkirk, East, which told of the dire consequences that would follow and which claimed a commitment to the more vulnerable in the community. All Conservative Members share that commitment. However, there has been a remarkable absence of specific examples and problems arising from the clawback. Quite the opposite has been the case. We have heard that local authority after local authority which is subject to clawback has a policy of spend, spend, spend. Money is still available to finance demonstrators on right-to-work marches and protests, for Left-wing theatre groups, Campaign for Nuclear Disarmament protests, and to send councillors on visits to eastern Europe. Despite the eloquence of the hon. Member for Glasgow, Garscadden (Mr. Dewar), money is still available for Glasgow to vote £20,000 to the miners and to say that more will be available when it is needed. Central region has done the same, to the tune of about £50,000.
The touching suggestion that Labour Members want to avoid confrontation and that confrontation is entirely of the Government's making is difficult to believe when one considers the position in Glasgow. The hon. Member for Garscadden asked us to consider Glasgow's case. Glasgow authority seems to be going out of its way to harm its tenants and to ensure that it does not have enough money to maintain its housing stock. Labour Members did not mention Hutcheson E or the deliberate tactics to obstruct the sale of council houses. The claim of the hon. Member for Monklands, West (Mr. Clarke) that the authority cannot sell council houses because it does not have enough staff is not borne out by the number of staff in that authority. If, however, that is the case it should get estate agents to conduct the sales for it.
Mr. Tom Clarke: I concede the right of the hon. Gentleman to have opinions, however absurd. If he feels that he can persuade the people of Monklands to his views, he should put them to the electorate. I doubt whether he will get a good response. The hon. Gentleman missed my central point, which was that the Monklands district council could sell those houses speedily, but only at the expense of some other important service. The hon. Gentleman should get out of our hair and let us get on with the job that Parliament has asked us to do.
Mr. Forsyth: I doubt whether those members of the electorate who are waiting to buy their council houses would share the hon. Gentleman's view. However, I
602
appreciate his point and do not wish him to feel that I am being unreasonable towards him. I respect his point of view.
If the authority has that problem, why should it not invite estate agents to carry out the work and pay them on a commission basis? That would release officers to carry out the other activities that he considers to be of priority, and it would bring in revenue. It is time that Labour Members lifted off their ideological blinkers and started thinking about the interests of their communities.
Mr. Dewar: I defer to the hon. Gentleman when he talks about ideology. His plans for the privatisation of prisons and the Women's Voluntary Service suggest that his standards of ideology are quaint and remarkable. Does the hon. Gentleman accept that his argument would be perfectly sound if his premise were correct? His premise is that the sale of council houses is good for council tenants. The option is arguably attractive to the individual tenant, but the hon. Gentleman must accept that those of us who are interested in freedom of choice and the choice of the vast majority of tenants recognise that there is a strong case against the Government's policy on this. If one takes that view, the hon. Gentleman's argument falls in ruins.
Mr. Forsyth: I am grateful to the hon. Gentleman for at last telling us where he stands on the sale of council houses to tenants. Opposition Members have always ducked the question; they are obviously now confident about their electoral prospects in Scotland. The vast majority of council tenants would take issue with the hon. Gentleman on that point. However, I do not wish to become involved in the rights and wrongs of council house sales, and I am sure that you would call me to order, Mr. Speaker, if I did. Thanks to the efforts of the Government, all council tenants have the right to buy their council houses and any local authority which disagrees with the law and obstructs it is guilty of something that is reprehensible and indefensible in a democratic society. Those Opposition Members who cry for democracy should not be selective about democracy; and those who condemn violence to achieve ends should not be selective about what sort of law-breaking and tactics they are prepared to go along with.
Glasgow has deliberately fostered an inefficient direct labour organisation at the expense of its tenants and of the available resources that it would have. It continues to spend regardless, and I must tell my right hon. Friend the Secretary of State that some Conservative Members are decidedly puzzled as to why Glasgow, with high spending in every area, has escaped serious penalties for so long and still receives the lion's share of Government support.
Mr. McKelvey: Glasgow has enormous problems.
Mr. Forsyth: Other areas of Scotland also have enormous problems. The difference is that in Glasgow many of those enormous problems have been created by local authority expenditure.
Perhaps I could leave Glasgow, because in this debate we are talking about all overspending local authorities, and return to the lack of evidence of cuts caused by the clawback. The hon. Member for Garscadden acknowledged that the expenditure in 1983–84 is more in real terms than the expenditure in 1978–79. It is extraordinary that Opposition Members will happily come to a debate such

603
as this and argue that point, but that elsewhere they will talk about cuts in local government expenditure. Where are those cuts if expenditure has increased in real terms?
Not every council tells the Government how it fiddles its budgets, and does not admit over-budgeting and devices to give it room for manoeuvre. I wish to outline the response of one Labour-controlled authority to the Government's requirements to meet the clawback. It reduced the assumed rate of inflation to a realistic level, eliminated the expected underspend and excess income from its budget and used some expected capital underspend to capitalise repairs. It had already budgeted for reduced rate support grant, although the officers had not informed the councillors of that. With those paper changes it managed to meet the £623,000 clawback requirement. There were no cuts, no reductions in services, no redundancies and no difficulties; like magic, clawback was met and the grant will be restored next year. I should tell those hon. Members who are puzzling over the vast variety of Labour authorities to which this could apply that I am referring to Kirkcaldy.
Even the authorities that must meet the clawback are in nothing like as bad a position as Opposition Members claim, although some of them should be. No council must make a full cut to balance its budget; it need only reduce the overspending to earn a refund equal to the remaining overspend. If one takes account of the weighting factors, most authorities need only cut their overspending by little more than half. Opposition Members have either not appreciated that fact or they are deliberately misrepresenting the position. Whether or not the clawback is savage, no Government can allow the sort of free-for-all that we are seeing in local government, with the encouragement of Opposition Members.
In the past, persuasion worked. I asked the hon. Member for Falkirk, East about the position during the Labour Government. He should have said that the labour Government were not anti-democratic because they asked the local authorities to cut manpower by 9,000 and to reduce expenditure by far more than this Government have asked. The tragedy is that the only Government who have managed to make real cuts on any scale in local authority expenditure were the Labour Government. [Interruption.] Hon. Members say that this is failure. On the contrary; the Government have been extremely reasonable. The difference is that when the Labour Government asked for cuts they received a sympathetic response. There lies the truth for all to see. The notion put forward by Opposition Members that the Government are provoking confrontation by asking for savings that pale into insignificance beside what the Labour Government obtained voluntarily, shows that this is a matter of confrontation for its own sake perpetrated for political purposes by Opposition Members. Where persuasion has failed, controls have had to be substituted.
It is astonishing that COSLA is sending us briefs claiming moderation among its members, yet that moderation is a consequence of the controls introduced by the Government. Without those controls the horrifying irresponsibility that we have heard in the speeches of Labour councillors would have been carried forward into bills to the ratepayers.
The order deserves our wholehearted support and will be widely welcomed. I hope that the people of Scotland will realise that Opposition Members stand for a pattern of local government that looks after the interests of the
604
trade unions and promotes overmanning and restrictive practices rather than the interests of the people who depend upon local government for services.
6.58 pm
Mr. Malcolm Bruce: With many hon. Members, I detect an air of déjà vu about the debate. Its only novel aspect was the slovenly arrogance with which the Secretary of State introduced it, which was disturbing if one considers the implications of the order. For him to come here without adequate papers or information and for him to leave immediately after his speech was not a good way to show that the cuts are incidental. However, that is typical of the way in which the Government tend to treat the House and the people of Scotland. They would prefer to issue edicts from St. Andrew's house and not waste time arguing about matters.
I challenge the Secretary of State's suggestion that the authorities which are supposedly responsible are not penalised but that those who are supposedly irresponsible are penalised. Those which are responsible—which do not exceed the guidelines — are penalised. The only difference is that they impose their own penalties rather than waiting for the Secretary of State to impose them. They are further penalised because future calculation of what they should be allowed to spend is based on historic spending, and because they have stayed within the guidelines they are penalised the following year. The cumulative effect is that they are less and less able to provide the services which people in their areas expect.
The Secretary of State should take seriously the reactions of Conservative, Labour, Liberal and Independent councillors throughout Scotland about the implications of what is now happening. Those councillors are making important and constructive points of which the right hon. Gentleman should take account.
A local authority must still operate in a businesslike manner, but it is no way to operate a business to impose budget cuts halfway through the current financial year and to expect anyone to make rational or effective cuts. One simply makes the cuts that one can make most easily. Ultimately, that may cost money, and such cuts will not necessarily be in the best interests of providing what the hon. Member for Stirling (Mr. Forsyth) described as value for money.
The recurring problem of annuality becomes even more extreme under this kind of mid-term review. It is high time that the Government found some way of allowing authorities, particularly on capital account, to carry over unspent moneys which are unspent only for technical reasons and in any event might relate to a project that runs for two or three years.
The hon. Member for Stirling said that we were only talking about generalities. It is important to speak not only for the councils included in the so-called hit list but for those which have imposed their own cuts and as a result are unable to provide the range of services that people expect. I shall be specific about the kind of cuts against which the people of Scotland are beginning to react.
The largest item of local authority expenditure is education. The Secretary of State should recognise that what is now happening to education in Scotland is causing widespread concern among parents who in a specific way are seeing a reduction in the quality of education provided for their children. In addition to the delegations that have seen me, I have a file of letters from parent-teacher

605
associations and individual parents stating that they do not believe that they are getting anything like the quality of education for their children that they are entitled to expect as taxpayers and ratepayers.
They are concerned about the rise in the average class size, about the increasing number and size of composite classes and about the cut in the number of primary school support teachers. That means that many subjects such as art, PE and music are becoming such limited components in the timetable that they are of very little value. If the Secretary of State regards those subjects as frills, I assure him that I and many others do not.
The consequence is an increasing recognition of the frustration felt by the teaching profession, which must operate against this background. In secondary schools they are expected to implement the new curricula with no new resources and no proper review of their pay and conditions to which they are entitled. The order will hardly enable the Secretary of State or the local authorities to come to an agreement which would even allow for the principle of a pay review which I and my colleagues support as the only way out of the present impasse. That is the only way of securing a possibility of an atmosphere in our schools which will produce a positive and healthy climate and a quality of education which many people feel we are no longer getting.
The Secretary of State is free to regard that as a political point if he wishes, but I assure him that the representations I have received come from sources that he should take seriously. It cuts across a wide spectrum of opinion.
Mr. Younger: I was not regarding it as a political point but I was interested in what the hon. Gentleman said. I do not know how it ties up with the fact that in the rate support grant settlement we have not only allowed for the best pupil-teacher ratios ever but also for the highest ever expenditure per head on pupils. How does that tie up with the hon. Gentleman's catalogue of woe?
Mr. Bruce: When school rolls fall it is possible to produce the statistical results about which the right hon. Gentleman has talked. However, if he looks at what is happening in individual schools, he will see that support teaching hours are being cut, that class sizes are increasing and that the number of teachers available are falling. The net result is a reduction in ratios and standards. I assure the right hon. Gentleman that that is what is happening. Simply to use the broad overall statistic does not alter that fact. What he has said simply tries to exploit a gradual change without applying it to what is happening in individual schools, which quite definitely is a reduction in standards and a fall in the number of support teachers.
If the right hon. Gentleman is challenging what is happening to the number of hours available for music in primary schools in the Grampian region, I shall be more than happy to send him a detailed note on every school in my constituency.
Mr. McQuarrie: What is the hon. Gentleman's estimate of a large class? Is he questioning the qualifications of the teachers who may be asked to take just a few more extra pupils?
Mr. Bruce: No, I am not. However, I wonder whether the hon. Gentleman thinks it is reasonable for teachers to
606
continue taking a few more pupils when the Government are not even prepared to review their pay and conditions. In private industry that would be regarded as a productivity deal which would be entitled to some sort of recognition in terms of pay. In those circumstances, the teachers have good reason to feel demoralised about the lack of response they have received to their reasonable approaches to the Government.
Mr. Barry Henderson: The hon. Gentleman has mentioned a campaign run by the EIS. I have great respect for the EIS in that it deals in hard facts. That is one of the impressive things about its campaigns. Has the EIS ever denied that pupil-teacher ratios have improved or that the amount of money per pupil in our schools has significantly improved under this Government? Whatever the hon. Gentleman's feelings, surely, like the EIS, he must accept that these are the facts.
Mr. Bruce: The hon. Member for Fife, North-East (Mr. Henderson) was obviously not listening. I am not speaking about the EIS but about all teachers. The EIS acknowledges this as a trend. Cuts are taking place in individual schools and the hours available for support teaching are being reduced.
In Grampian region the director of education has admitted that £1 million has been cut from this year's primary education budget, after he attempted to suggest that it had not happened by lumping it in with the global education figure. I am sceptical about taking global statistical figures to support a general statement of case given the actuality of what is happening in individual schools. I simply challenge the hon. Gentleman and the Secretary of State to square the circle. That is what the parents will want to hear from the Government.
Education is not the only service provided by local government. There are also road and transport issues and new problems such as deteriorating water supplies, collapsing drainage and sewage systems and the introduction of new flood control systems. These are not being catered for in the context of what the Secretary of State is imposing on local Government. The net result is that councillors and officials who are trying to provide such services find their jobs increasingly negative and depressing. They are unable to assess need in a sensible way because whatever budget they come up with, the Secretary of State is liable to interfere with it half way through, and impose arbitrary changes at very short notice. They are unable to plan ahead and to meet needs in the longer term. Many people accept that they cannot have everything today, and that things need to be properly budgeted for and controlled. However, they cannot abide the fact that many necessary services are being postponed not just to next year or the year after but until 1990 or 2000.
Mr. Younger: I am still very puzzled about where the hon. Gentleman's argument is taking him. How does that tale of woe tie up with the fact that the local authorities to which he is referring are, in general, still spending in real terms about 2 per cent. more than they were spending in 1978–79?
Mr. Bruce: It ties up with the Government's failure to manage the economy in a way that does not put so much pressure on local authorities, which have to provide the housing and community services. There are nearly 4

607
million unemployed, which is nearly twice as many as there were when the Government came to power. The right hon. Gentleman's idea that the community services that the Government expects local authorities to provide can be provided when there is increasing demand without increasing resources shows that the Government should be looking at the logic of what they are suggesting. We view the reality of what is happening.
The convenor of Lothian has said that he is not in the business of imposing more cuts, and the convenor of Grampian has said that he is dissatisfied with the Government's approach to the guidelines and the estimate of the needs for the future. I shall make a constituency point here, because there are circumstances in Grampian that are not widely recognised. From the Government down there is a view that we in the north-east have the advantage of an oil industry and therefore particularly low unemployment, and I do not deny that. However, that does not mean that we do not have problems. In my constituency, between 1971 and 1981 there was a population growth of 56 per cent. The only other community in Scotland that had a growth rate at that level was Livingston, which is a new town with a new town development corporation. I suggest to the Secretary of State that he has not taken full account of the simple costs of operating such as a growing economy in his assessment of the guidelines.
I can be more specific than that. At the moment, 2,000 new houses are being built in my constituency and virtually every one is for the private market. That is odd, because there are 2,000 houses up for sale that nobody is buying. At the same time, housing waiting lists for council houses in Aberdeen and Gordon have gone up and up. The Under-Secretary keeps thrusting down my throat his argument that the sale of council houses releases resources, but that argument is patently not working.
The Government are playing the party political line, which squeezes the poor person from the council waiting list between the ideology of the Tory Government and the ideology of a Left-wing administration. I shall not defend the Left-wing Labour administration in Aberdeen, which has not conformed to Government guidelines and has seen the waiting list go up to 5,000. The Gordon district council has—I am beginning to believe somewhat foolishly —co-operated all the way and tried to be reasonable and constructive and follow the Government guideline. However, it has had the same sort of increase in its waiting list, although it has been selling council houses at a rate of knots.
There is nothing that I can say to the people from my constituency who come to me every week asking when they will get a council house. The only thing that I can do is to send them to the appropriate Minister and tell him to tell them, as I am sick of telling them, that they will not get a council house until the Government are prepared to put some resources into meeting such needs.
The problems in growth areas and the problems in declining areas are different, but they both need to be recognised. The Government will argue that they have applied what are jokingly called guidelines on a varying degree, according to circumstances. However, the black box calculation that comes out of St. Andrew's house is a mystery to everybody whom I have ever met or spoken to. I am beginning to realise that what happens is that the Secretary of State sits there with a list and says, "Who are they, what do they do, how did they behave last time?
608
Come up with a figure and we will justify what we are doing." He has never been able to explain convincingly the logic of what is happening.
In all this the Secretary of State has pleased nobody. There is nobody in local government of any political persuasion with a reasonable understanding who is satisfied with the way that the Government are going about telling local authorities the way to run their affairs. That is the reality of the position and, if the Secretary of State is not prepared to take advice from the Labour party or the Liberal party, I hope that he takes it from some of the representations from some of his own party, or he will be representing an ever smaller band in this House.
I know that I have no chance of persuading the Secretary of State to remove this order. He has suggested that he has modified his views slightly, but I am not persuaded that this is a fundamental change. However, he must address himself to the problem of how local authorities, councillors and officials, can plan properly, sensible and intelligently to provide the services for the future over a reasonable timescale. They must be able to know that they have some chance of implementing their budget plans without constant menacing and interference. That would be in the best interests of both good local and good central Government.
The charade that we have witnessed this year, last year and the year before must not be the permanent method to run local authorities in Scotland. If it is, it will be a disastrous failure that will not produce the services that are needed. I urge the Secretary of State to start thinking of positive steps by which local government can be put on the right road to doing the sensible job that it should be doing.
It is all very well for the hon. Member for Stirling to say that cuts should be greater, and to go on about the things that he does not like about local authorities that are not of his persuasion. He never tells us what he thinks local authorities should be doing. He says what he thinks they should not be doing but he does not tell us what their responsibilities are and how they should be financed and operated in a constructive and operative way.
If this debate is to mean anything in the history of local government in Scotland one would like to think that it would make a start to getting out of this annual charade and into a situation in which the Government set clear objectives for local authorities to follow over a sensible period. Local authorities should not have to abort and abandon their plans and spend half their time, when they should be running their services, running backwards and forwards to the Government trying to understand what the Government want them to do. They should not have to argue about guidelines while pleading with Ministers who are unable to explain the justification for what they have done or what the long-term prospects are.
I and my colleagues shall be voting against this order.
7.17 pm
Mr. Gerald Malone: I was hoping that the hon. Member for Glasgow, Garscadden (Mr. Dewar) would be in his place because I shall pick up where he left off, at the risk of consistently quoting one newspaper — The Scotsman. I thought that the hon. Gentleman made a good point when he was trying to show that it is impossible to divorce local authority expenditure, from public expenditure as a whole. I reinforce that point by again quoting from The Scotsman:
"With further cuts in public expenditure now being forecast"

609
the Secretary of State
"will be unwilling to let councils off the hook regarding overspending. The Government have made it clear that they are deeply concerned about the effects of local authority budgeting. Keeping a tight grip of council spending is vital to their efforts to control the economy."
That could have been said about what the Government are trying to do today. However, that report was published in The Scotsman on 9 July 1976, and the Secretary of State was the right hon. Member for Glasgow, Govan (Mr. Millan).
This example illustrates the Labour party's double standards. We have had many debates such as this in which the principle of central Government controlling local authority expenditure and directing the ways in which it should go have been discussed. The speeches of the hon. Member for Garscaden are becoming akin to a recitation of Holy Willie's prayer at a Burns supper. They have all the panache of such a poem and about as much sincerity. We hear him say that local authorities are losing their democratic rights to spend. I reinforce what my hon. Friend the Member for Stirling (Mr. Forsyth) said. If we want to learn lessons about cutting local authority expenditure, we need look no further than the Opposition Benches.
As my hon. Friend said, in 1977–78 the Labour Administration, because they were dealing in those days with crony councils, were able to cut manpower voluntarily by about 9,000. If manpower levels can be taken as a reasonable way of determining how efficiently local authorities are performing, if we look at the full time equivalents employed in 1977 and employed now, we find that there are now an extra 4,200 in Scotland as compared with 1977. So there have not been enormous cuts. If the Labour party were in power, it would be cutting on a greater scale than the Government. The truth is that my right hon. Friend has been generous in his order.
I particularly welcome the fairness which has resulted from the Government's legislation. Previously we would not have had such a finely tuned instrument as the one we now have to promote the clawback. It would have been an unfair instrument. Local authorities would not have had the chance of changing their position and going back within the guidelines set out by my right hon. Friend. They would not have been able thereby to reduce the clawback to nil.
The Government's approach is a much fairer one than has been used previously. The hon. Member for Gordon (Mr. Bruce) suggested that it is not the right approach and that it has created uncertainty. I remind him that Gordon district council, in his own constituency, finds no such problem. It is able to study the guidelines, to propose a budget within those guidelines, and to operate within them.
Mr. Foulkes: How can the hon. Member use the term "finely tuned instrument" and say that the instructions are well within time when we are already halfway through the financial year concerned?
Mr. Malone: The hon. Gentleman is missing the point. If local authorities had abided by guidelines that were intimated to them in good time, there would be no need for a measure of this kind. As compared with last year, those local authorities which overspend are the ones which
610
are most attacked and which have the biggest clawback from their budgets, but they are also given an opportunity which they did not have before. If they come back within the guidelines, they can be restored to their previous position.
I represent part of a city which is in overspend, and I represent part of a region which has abided by the guidelines and which has budgeted for a minimal underspend in the course of the year to which we refer.
We must look at the attitude of local authorities and the way in which they approach the question of running the authority. We must see whether they are doing their best to realise the most revenue. We have again to consider two points—the level of rents and the level of council house sales. The hon. Member for Gordon suggests that waiting lists are a measure of need, but that is not so. There are many people who are already housed and who appear on a waiting list. Although there are waiting lists for council houses in the city of Aberdeen, there are many council houses which are empty and unoccupied because those on the waiting list do not need to be housed but wish to be housed in better accommodation. I understand that, and they are entitled to be on the waiting list, but it is false to regard the waiting list as a measure of need. If the city of Aberdeen wanted to improve its housing position, it could do so easily by raising rents to a reasonable level and by implementing enthusiastically the policy of council house sales.
In the city of Aberdeen there has consistently been a refusal to implement the policy of council house sales. Wherever there have been concessions they have been grudging. The majority of the complaints that I receive about local authorities relate to council house sales. In many cases the degree of maladministration is such that there may have to be reference to the Ombudsman. There is a failure to conclude missives within the time limits set by the Government, and there is a general view that those who have a right by statute to buy their council house should be thwarted in their endeavour. If Aberdeen district council is so enthusiastic about maintaining its spending above the guidelines, the solution to its problems is well within its own hands. It needs only to implement the policies set out by the Government.
I should like to use Grampian regional council as an illustration of a council which is in a difficult position for several reasons but which is none the less able to come within its spending guidelines. The hon. Member for Gordon referred to the slightly peculiar situation of Grampian region, in that growth within a region brings special needs, as does deprivation. I should like to take that point a little further and make some points to my right hon. and hon. Friends on the Government Front Bench.
The introduction of the client group approach to the calculation of needs of local authorities is basically fair, but it should not be an approach which ignores the special needs of any particular community. The movement towards the client group approach has resulted in reliance on statistics which are somewhat out of date. I understand that, prior to the implementation of the client group approach, population statistics only 12 months old were relied upon for the calculation of some figures.
But the movement on a wholesale basis to a client group approach has resulted in those statistics being two years out of date, the reason being that many local authorities prefer to get the figures early. It is possible to refer to figures that are two years old only if there is to be a specific

611
determination of the guidelines for each council. While I understand that and take the point that in most local authorities throughout Scotland it may be a matter of marginal relevance, I ask my right hon. and hon. Friends to remember that the position in Grampian region is somewhat different from that elsewhere.
There is a steady increase in the growth of population in Grampian region, and the movement to a base of population statistics that is two years out of date is having a fairly severe effect. Albeit that Grampian regional council has been able to come within its guidelines, I understand that it has done so only with great difficulty. Taking up-to-date figures of population for the current year, it would be possible to suggest on a statistical basis that the grant for Grampian region should have been increased by about £2·4 million. It may well be suggested that that is a statistical problem that Grampian regional council will outgrow, but the truth is the opposite. Over the years the base will remain out of date, and any increase in population will always be worse off than many other regional authorities.
I suggest that there are three possible solutions to the problem. One is that the Government could introduce a special factor, based on trends available from census information, which could be applied to Grampian regional council's grant when guidelines are being fixed. Secondly, there could be a permanent weighting applied to figures which are two years old in order to take that factor into account. Trends could be established which would make the weighting a fairly easy percentage to calculate. Thirdly, the guidelines could be recalculated at a future stage when the relevant information became available, and I seriously suggest that the Government should consider that third approach.
It would seem to be unrealistic to ask the Government to apply special weighting factors which are not based on hard statistical evidence, but it would not be unreasonable to suggest to Grampian regional council that, if it made its own estimate of what the recalculation would be in the light of its detailed knowledge of its own population characteristics, it could, as it were, expand the guidelines, and overspend on a temporary basis, if necessary, on the understanding that its guidelines could be recalculated later.
As all local authority budgets are tight, I suggest that if £2·4 million were given to Grampian in excess of its guidelines, that would be a significant improvement and would go some way to mitigate its difficulties in the face of an increasing population. I shall be interested to hear from my hon. Friend the Minister whether there is some sympathy with that point of view. After all, why are we penalising regions that have kept within the guidelines? Grampian regional council has, with great difficulty, kept within its guidelines for the current year by about £37,000. The correct approach is to assess the needs of such a region, based not on an unreal population but on population changes. Thus Grampian would get not more than its due, but its fair due in a difficult situation.
Consultation with non-statutory bodies has been undertaken recently by Grampian regional council with some success, but I ask my hon. Friend the Minister to give an undertaking that the procedures that were so much vaunted when they were brought into being are being properly implemented. I hope that he will undertake to report back to the House on whether he thinks that those procedures are successful.
612
Occasionally I wonder whether the non-statutory bodies have the power or, in some cases, the wit to undertake negotiations with local authorities on a realistic basis. After the first period of consultation has ended, the procedure may turn out to be little more than window dressing. If that is happening, the House should hear about it. It should hear the views not only of my hon. Friend but of the local authorities that have been consulted.
That is a problem, and we shall talk about such matters into the indefinite future until some Government — I trust, this Government— tackle the problem of radical rate reform. I do not believe for a moment that it is adequate simply to put the problem on the back burner. I am not suggesting that it is the fault of either my hon. Friend the Minister or my right hon. Friend the Secretary of State.
Mr. McKelvey: It is certainly not our fault.
Mr. Malone: It is as much the fault of Opposition Members as anybody else.
I remind my hon. Friend the Minister that this problem has plagued the House since about 1928, when many proposals for radical reform of the rating system were made by Winston Churchill. I do not dare suggest that my hon. Friend will leap in where the distinguished knight failed, but the matter must continue to have great priority. While I understand his inability, or perhaps reluctance, to bring forward immediately proposals for radical reform, it would be helpful to hear from him tonight that the Government have not forgotten about that. I understand the pressure of business upon my hon. Friend, but he and the Government have a long future before them. I trust that they will at last get round to dealing with something that I assure them is a priority in the eyes of the electorate.
7.34 pm
Mr. William McKelvey: It was a pleasure to hear the speech by the hon. Member for Stirling (Mr. Forsyth). Before it I might have doubted the reason for my presence in the House and wondered why we should be debating for the umpteenth time another intrusion into local democracy. However, the hon. Gentleman has made me realise why I should be here. I almost said that he spoke in "purist" terms of monetarism, but I shall change that to "extremist" terms.
It was interesting to hear the comments of the hon. Gentleman's surrogate, the hon. Member for Aberdeen, South (Mr. Malone), who began his speech almost in the same frame of mind but ultimately decided that, although every local authority should have some money extracted from it, Grampian region should be given £2·4 million. I noticed that the hon. Member for Stirling did not nod in agreement when the hon. Gentleman changed his tune.
I am sorry that the Secretary of State has had to leave the Chamber, but I hope that his absence will be only temporary. He would not have been disappointed to hear me say that I found his speech not only as anticipated but utterly boring. I have copies of all his previous speeches in similar debates. They do not vary, apart from a change in some figures. After pressure and a little assistance from the Opposition, the right hon. Gentleman gave the names of the wretched authorities over which the sword of Damocles has been hanging for the past year. We were grateful for that information. The Opposition have said

613
from the beginning that the penalties imposed on those authorities were grossly unfair. They all stem from the mysterious guideline formula.
I have searched through the historic documents about the rate support grant, but I cannot discover what the formula is. On occasions in Committee we have got near to the formula, but some part of it has always had an air of mystery attached to it—a sort of annex that no one could describe or say what it was. It is as if there were divine inspiration. The Secretary of State sits there like a modern Svengali and beams out a figure that is manufactured from thin air as the basis of the formula. All the formulas that follow are based on that false premise.
If I asked the Secretary of State how he calculated Kilmarnock's share of the clawback, he would refer me to annex 2. Even a mathematical fool like me can read and find out how the clawback was apportioned, but these formulas, like all of them, are based on the original formula. There is no real scientific explanation of how the Secretary of State in the first instance decided what realistic expenditure was. That is why we in the Opposition can never get to grips with the matter.
The Secretary of State may be unaware of this fact. I hope that he reads my speech tomorrow and that the Under-Secretary will give him this piece of priceless information. This is a historic debate. I have an extract from a minute of an equally historic meeting that took place in Ayrshire. During the past three years, after all the Secretary of State's endeavours, with his persistent intrusion into the affairs of the democratically elected authorities, a near miracle has been brought about. In Ayrshire, all the local Labour-controlled authorities and the three Labour Members of Parliament are acting in unison. That is much more serious for Conservative Members than it sounds. The Secretary of State has managed to do what politicians have failed to do for decades. The only parallel in recent history is the fact that the Prime Minister has managed, through her attacks on the Greater London council, to reform red Ken Livingstone into a local hero. The same sort of thing has happened in Ayrshire, and we are all delighted.
At that historic meeting, we in Ayrshire united to launch a counter-offensive on the attack on the ordinary man and woman in the street. We shall not give details of how we are going to tackle the problem but we have passed a resolution that we shall meet again on Friday—I shall not say where—to draw up the plans for that counter-offensive. That Ayrshire forum, set up locally, has reached unanimous decisions. Part of the minute which I am describing says:
"That there be a local campaign to explain to the people of Ayrshire the attack that is being made on their services, their standard of living and their job prospects by the Secretary of State for Scotland."
I hope that the right hon. Gentleman gets that information. He is the Ayrshire Member of Parliament who stands out. I do not know whether he was invited to the meetings. To be fair to him, he may not have been. If he has not been we shall do so. However, I can understand his difficulty in combining with us in actions against himself.
I have looked at the reduction of the Kilmarnock district council support grant. The actual figure is £292,954. It is impossible to discover exactly why that figure was arrived at. I have explained the fault in the original formula. We
614
have not yet considered what that means to the local authority. Conservative Members have said that not only must there be absolute value for money but that the smallest manning figures show the authority that is run on the best lines. That is nonsense. Ultimately that would mean that an authority with no manning—assuming the work was not all put out to private enterprise—would be working the perfect system. That is probably true enough, but what about the services? That is the key to our argument. It is the services which suffer. When the Secretary of State issues his guidelines he never refers to how the shortfall in services is to be tackled. That is the problem that faces local authorities. Without the money there are only two ways to balance the budget—either to reduce drastically manpower levels or increase the means of obtaining money from other sources.
Kilmarnock and Loudoun district has trimmed its services to the bone. There is no question of it crying wolf. Any reduction in grants must mean a reduction in manpower and must mean that unemployment will be forced on people. There will not be voluntary redundancies but job losses. If such a reduction were to be accepted it would mean a loss of somewhere between 50 and 100 jobs in an area with 17 per cent. unemployment. That is completely unacceptable.
I wonder why Conservative Members raise their hands in horror when one tries to explain why it is necessary nowadays to spend more money on services because of the unemployment that we have. They must be unaware of the misery in which people live in areas of high unemployment and the kind of services that are required to assist them to overcome the worst elements. Kilmarnock has now reached the stage where decisions will have to be made whether to continue lifting refuse. Local authorities cannot be expected to take such decisions on graveyards. Are we to leave our dead unburied in order to save money? Is that a realistic proposition? Are we to cart the bodies from Kilmarnock and Loudoun to another Ayrshire district which can perhaps afford the burials? Are we to leave the refuse on the streets because there is no other means of reducing the cost of lifting it?
The only practical steps that can be taken are to cut library and museum services. Are we then arguing that we should close libraries and museums? At the end of the day somebody somewhere has to explain where cuts are to be made after services have been cut to the bone. So far such explanations are not forthcoming from Conservative Members. Cuts are always explained in purely monetarist terms—the balancing of the books and the juggling of figures. No word is ever said about the effect that such cuts will have on the lives of ordinary men and women, particularly in areas of high unemployment where the burdens are increased.
Mr. Malone: How does the hon. Gentleman explain that some local authorities are well able to supply such services within the guidelines? The House is only talking about excess. The guidelines are satisfactory. They are based on a client group approach. Other local authorities are able to provide those services within the guidelines.
Mr. McKelvey: One of the big problems about the client group approach is that districts vary. They all have different environmental conditions. We discussed earlier the problems of Glasgow. Some Conservative Members thought that Glasgow's problems were no different from

615
the problems of Stirling. That is nonsense. Most people realise that Glasgow's problems are immense. Therefore, other areas with different problems require different solutions. It may be that an authority can operate within the guidelines because the services that it supplies are thought to be adequate. It may well be that the electors do not think that they are adequate and perhaps change the authorities as recent elections have shown.
Let me return to my original complaint about the intrusion which has persisted for three years. Next year the Secretary of State will be in a position when debates such as this will be immaterial because he will be running the whole show. He will determine rates, rents and expenditure. A wind of change is blowing through the local authorities in Scotland, thank heaven. Some will now be reflecting in their inner thoughts that when the Secretary of State went for Lothian they remained silent, when he went for Dundee they remained silent, when he went for Stirling they remained silent, but now he is coming for them. With that realisation the historic grouping of councilors, councils and Members of Parliament in Ayrshire will be extended throughout Scotland. Only then will the Conservative party realise exactly what is happening in Scotland.
This evening the Secretary of State had to make an announcement that he was to give relief to four authorities. I prophesy that within two years he will be making a similar announcement for the 50 authorities that he is penalising now.
7.48 pm
Mr. Barry Henderson: The hon. Member for Kilmarnock and Loudoun (Mr. McKelvey) has an extremely attractive way of saying the most frightful things. The fact that Labour Members in Ayrshire and some of their local government colleagues can talk to each other is encouraging and I am sure that it has nothing whatever to do with the reselection process which I understand starts next month. He told us that they were going to explain to the people what I think he called the Government's attack on local government services. How will he explain to the same people how he can describe as an attack on services Government expenditure in support of local government which is higher in real terms than when the Labour Government were in office?
Mr. McKelvey: If Kilmarnock has its money cut by £292,954 — as will happen if it fails to meet the guidelines—there will be a reduction in the services. We are laying the blame for that fairly and squarely where it lies—in the lap of the Secretary of State for Scotland.
Mr. Henderson: I shall return later to the point about the growth in local government expenditure during the past few years that has resulted from the situation that the hon. Gentleman described. It may be that compared with last year there will be a call this year for a reduction in the amount of expenditure made by the hon. Gentleman's district council. However, that does not alter the fact that the amount that the Secretary of State now provides, in total, in support of local government services is higher in real terms than that provided by the Labour Government in 1978–79.
Perhaps the hon. Gentleman can answer a question that the hon. Member for Glasgow, Garscadden (Mr. Dewar) clearly dodged. The hon. Member for Kilmarnock and
616
Loudoun said that the Secretary of State's speech was entirely predictable, but it clearly had not been predicted by the hon. Member for Garscadden. He must have heard the Secretary of State challenge him to say whether the parliamentary Labour party would support local authorities that acted in defiance of the law, yet he made his whole speech without referring once to that point.
Mr. Foulkes: I hope to say a few words about that later. However, perhaps the hon. Gentleman can help me by telling us precisely which law he is talking about. That is very important.
Mr. Henderson: I shall tell the hon. Gentleman precisely—I am talking about any law of the land. It is very simple for Members of Parliament. It does not matter which law one chooses. If it is the law, it should be obeyed. If it is not obeyed, it is being defied. One does not pick and choose which laws to agree with. I hope that the hon. Gentleman accepts that proposition.
Mr. Foulkes: I accept that, but the hon. Gentleman is waffling. Does he know what law the Secretary of State was talking about in this instance, in this debate and on this subject? If he cannot tell us, I shall return later to one or two laws that are being broken.
Mr. Henderson: The hon. Gentleman will not get me to digress ——[Interruption.] He has answered in a way that the hon. Member for Garscadden did not do. The hon. Member for Carrick, Cumnock and Doon Valley gave us a straight answer and said that every law must be obeyed. Noticeably, the hon. Member for Garscadden did not do that, and we look to him to do so before the debate is over.
The hon. Member for Gordon (Mr. Bruce) used a different technique in campaigning against the Government. His technique was to create a convenient image of what he thought the Government were doing and then to attack it. When my right hon. Friend the Secretary of State pointed out that his image was entirely contrary to the facts, he simply said that he preferred his own image anyway, and was not very concerned about reality. He referred to some growth in the demand for services, but he did not recognise that there has also been some reduction in the demand. The greatest reduction has come in the biggest area of local authority budgeting. Much the largest proportion of a regional council's budget—it is such councils that are the big spenders—is concerned with education. It is in that area, however, that the demand has fallen most dramatically.
Mr. Ewing: That is absolute rubbish.
Mr. Henderson: Does the hon. Gentleman wish to intervene?
Mr. Ewing: I am grateful to the hon. Gentleman for giving way, but does he appreciate that in talking about education he is talking about the whole range of it? Is it not true that in his region of Fife they are having to open an extension to the Kirkcaldy college of technology by using an older school in another part of Kirkcaldy to meet the increasing demand for education in that age group? It. is rubbish to talk as he has done.
Mr. Henderson: The hon. Gentleman should be a little calmer in his reflections on such matters. I was talking about aspects of education that fall within the responsibilities of regional councils. I am not including some aspects of tertiary education — [Interruption.]

617
Some aspects of tertiary education fall within the region, but others do not—[Interruption.] I accept that central institutions do not. I notice that the hon. Member for Falkirk, East (Mr. Ewing) has suddenly become an expert on education in Fife——
Mr. Ewing: I am more of an expert than the hon. Gentleman and he is supposed to represent that area.
Mr. Henderson: The hon. Gentleman should be very careful about that. I do not interfere in his constituency matters and perhaps he should interfere less in mine.
It has been said that Fife has experienced some increase in the amount of education provided. That is true, but most of it is paid for by the Manpower Services Commission. I accept that there have been some welcome increases in further education. However, there has also been a very substantial reduction in secondary and, to some extent, primary education. Thus, in total, the demand in Fife region is less than it was a few years ago. Such factors have to be taken into account.
I should like to refer first to the need for this order, secondly, to the fact that we still have further to go in making the system fairer, and, thirdly, to some suggestions for my right hon. Friend the Secretary of State about the future. I shall deal first with the need for the order. The hon. Member for Garscadden referred to the somewhat bruising battle that has been going on for some years between central and local government. That was a fair description, but it needs more than one person to do battle. I suggest that the battle started before the Conservative party came to power.
My hon. Friend the Member for Aberdeen, South (Mr. Malone) has already told us about the quote from The Scotsman clearly showing how much it approved of the efforts of the right hon. Member for Glasgow, Govan (Mr. Millan) to curb local expenditure in Scotland. The right hon. Gentleman was able to reduce local government manpower by 9,000 in one year. That same newspaper is criticising this Government for seeking to contain local government expenditure at the same level, in real terms, as the right hon. Member for Govan sought when he was in office. Local authority manpower has increased by thousands since then.
When Labour was in power there was a battle when it was recognised that the totality of local government expenditure had to be controlled. The Government have continued that battle. There is only one difference. When the Conservative Government came to power Labour local authorities—partly because of the rapid shift to the Left —decided that to annoy the Conservative Government and make party political points they would take every opportunity to spend more money.
Mr. Buchan: The difference is 4 million unemployed in Britain and 360,000 unemployed in Scotland. If the hon. Gentleman does not recognise that they impose extra demands on local authorities and their expenditure, he must be lying with his head in a bucket of sand.
Mr. Henderson: I know that unemployment has increased since 1979. Unemployment doubled when the Labour Government were in power.
It is easy for a local authority suddenly to jack up expenditure, take on more staff and produce some lovely handouts, but it is more difficult to curb excesses.
Mrs. Anna McCurley: Is there not a strange logic in what the hon. Member for Paisley, South (Mr. Buchan) says about the unemployed using more resources? The fact is that these people existed before they were unemployed and used the local authority services to the same extent, with the possible exception of social work services. There is a false logic in what the hon. Gentleman says.
Mr. Henderson: My hon. Friend, who has practical experience, clearly understands the problems better than the hon. Member for Paisley, South (Mr. Buchan). I was trying to explain that, although it is easy rapidly to increase local aurthority expenditure, once increased commitments have been made it is much more difficult to curb excesses. That is a particular problem in the Lothian region.
Hon. Members have mentioned Councillor Brian Meek's anxieties and the difficulties that he faces in leading an administration which is trying to curb total expenditure. His is a massive task. His problem is not the Secretary of State for Scotland but the mess resulting from outrageously excessive spending by the previous Labour regional authority. The recovery from that authority's excesses will take years and will be extremely difficult. I sympathise with Brian Meek and his colleagues in trying to grapple each day with the problems of recovering from that excess. It will be difficult, but it does not absolve the region from the responsibility of playing its part in controlling the totality of local authority expenditure in Scotland.
Mr. Charles Kennedy: Will the hon. Gentleman give way?
Mr. Henderson: I have given way several times already and I do not wish to be accused of taking too long.
Whatever party is in power, there must be some limit to the totality of local government expenditure. It is not disputed that central Government support for local government expenditure is greater than it was when the Labour party was in power. We are therefore arguing from a responsible and reasonable position.
Reference has been made to enabling local authorities to plan further ahead. I sympathise with that. I hope that local authorities will now plan ahead clearly knowing their guidelines. We should try to make the guidelines fairer, since they are at the heart of local government finance. There is still scope for improving that formula. I accept that the significance of guidelines is greater today than it was when the guidelines were formulated. Because they are more important, we have more work to do to refine and improve the system. I hope that my hon. Friend the Under-Secretary of State will make it clear that he is willing to listen to suggestions for improving methods whenever the opportunity arises.
I have in mind in particular a matter which affects the north-east Fife council. In summer, the population of north-east Fife quadruples. But there is no recognition of that when assessing local needs for services. I hope that my hon. Friend will be as energetic as ever in seeking to make the system demonstrably fairer, to cater for all the different situations.
So to the future. I hope that local authorities will recognise the limits that are appropriate for them when it comes to support from central Government. I hope that they will recognise the limits to the demands that they should make upon the ratepayers. Often ratepayers are not

619
the people who vote at local elections. The Government today say that they will support expenditure according to assessment and need, and that if it is responsible a local authority need not increase rates excessively.
The difference can be made up by raising or lowering the rates. The raising of rates could be open ended if those who sought local government services paid for them. But that does not happen. That is why my right hon. Friend the Secretary of State was right to introduce legislation to limit the extent to which a local authority can raise rates when its expenditure is excessive and unreasonable.
If a local authority is to be left to fix its expenditure without control by the Secretary of State of additional money raised locally, there is only one solution. The guidelines determine centrally the appropriate rate level. If a local authority wants to go over the top, the cost should be borne directly by those who elect that authority. That means a poll tax. Something along those lines should be considered. It would enable local authorities to do what Opposition Members want them to do — to be free to spend as much as they like beyond what central Government will provide for them. I think that that is all right, so long as the people who make the decisions pay for them.
8.9 pm
Mr. George Foulkes: I know that it is traditionally hoped that hon. Members will follow previous contributions in a debate, but I hope that the House will forgive me if I do not pick up all the amazing points made by the hon. Member for Fife, North-East (Mr. Henderson) and follow him along the highways and byways of his constituency. I plan to be brief and to make some relevant points.
I am sorry that the hon. Member for Stirling (Mr. Forsyth) is not here because the bulk of what I have to say should be of interest to him. To demonstrate the idiocy of the guidelines, I shall use the example of Cumnock and Doon Valley district council, which the hon. Member for Stirling praised in a previous debate as a prudent and reasonable authority.
First, however, I am pleased that my hon. Friend the member for Kilmarnock and Loudoun (Mr. McKelvey) mentioned the impact of the clawback on jobs in his constituency at a time when unemployment is at a record level. Based on the generally accepted estimate that it costs about £10,000 to provide a job in the public or private sector, I calculate that a clawback of £90 million will result in a loss of about 9,000 jobs in Scotland in both sectors. There will be cuts in contracts and supplies to local authorities and that will affect the private sector as well as the public sector.
Secondly, hon. Members will have seen how the hon. Member for Fife, North-East squirmed, writhed and dodged the question when I asked him which law he was talking about when he challenged my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) in his absence. The Secretary of State also spoke about the law being broken. We often hear wild statements by Conservative Members about the breaking of the law.
Mr. Ancram: I have been looking forward to hearing the hon. Gentleman's answer to the question. The law to which my right hon. Friend the Secretary of State referred was that mentioned in the resolution passed by the Labour party conference which, after some fairly typical sloganising, ended:
620
"salutes Liverpool's stand and supports councils which are forced to break the law as a result of Tory policies."
What did the hon. Gentleman understand that law to be?
Mr. Foulkes: That is amazing. The Minister is a Scots lawyer, yet when an hon. Member asks him to say which law in Scotland has been broken, the Minister quotes a resolution of the Labour party conference. We want a better text than that.
Mr. Ancram: We should like to know what was "the law" in the resolution that I assume the hon. Gentleman voted for at his party conference.
Mr. Foulkes: The Minister does not even know the constitution of the Labour party. I did not have a vote.
The Secretary of State and the hon. Member for Fife, North-East were both challenged twice and were unable to specify which law in Scotland local authorities are breaking. I have no legal experience, but I know that the Social Work (Scotland) Act 1972 requires social work authorities—the regional councils—to do certain things. For example, they have a duty to provide services for the disabled, the elderly and young people in care. People in social work would argue that, because of the cuts being forced on local authorities by the Government, local government is in danger of breaking that law— if it is not already doing so. Government actions are forcing local authorities to break that law. Does the Parliamentary Under-Secretary condone the breaking of that law? Does he condone local authorities not carrying out their statutory responsibilities?
The guidelines are arbitrary, and pseudo-science and pseudo-statistics are used by the civil servants in the Scottish Office. They end up with strange algebra such as
"Weight = A × (B) 0·1 and Penalty = W/S × P."
A councillor in Kyle and Carrick told me about a meeting at which it was explained to him how the formula and guidelines for Kyle and Carrick were worked out. A specific figure was arrived at after using the complicated formula and was then reduced arbitrarily by 40 per cent. to get to the guideline. What is scientific about that? The Under-Secretary is not challenging my statement. He accepts that the guidelines are arbitrary. I hoped that the hon. Gentleman would claim that I had been duped by the councillor. I am disappointed that he did not intervene, because I was ready with a riposte, which I shall give anyway! The information was given to me not by a Labour councillor in Kyle and Carrick, but by a Tory councillor —indeed, by the leader of the Conservative group, who is annoyed about this strange and arbitrary exercise which suggests that the council is 4·06 per cent.—two decimal places—above the guidelines. It is manifest nonsense.
Cumnock and Doon Valley district council is allegedly 12·8 per cent. —two decimal places again — over the guideline. The hon. Member for Stirling singled out that council for praise as a prudent authority which was economic in its operations. My hon. Friends know that not many authorities are singled out for praise by the hon. Gentleman. Cumnock and Doon Valley would not normally attract praise from the hon. Member, because it has not privatised anything and all 10 councillors are Labour. We have a wise electorate in that area.
When the council met the Scottish Office, the Department's officers expressed some sympathy for the council's case. However, they said that they could not

621
respond to the representations. They could not do so because the guidelines are arbitrary and decided not by the needs of an authority but by the straitjacket imposed on spending requirements by the Treasury.
The district council wanted to meet the Secretary of State to discuss its needs. It wrote to him but is still waiting for a reply. That is a disgraceful way to treat a local authority — especially when the hon. Member for Dumfries (Sir Hector Monro) told us that Nithsdale had a personal visit from the Under-Secretary. It is obvious that some local authorities receive special attention. However, Cumnock and Doon Valley was graced by a visit from the shadow Secretary of State.
Cumnock and Doon Valley is a modest authority. There is constant criticism from Conservative Members about authorities with over-large administrations. Apart from the chief executive, Mr. Douglas Hemmings, there are only three directors in my local authority — the director of finance, the director of technical services and the director of environmental health and cleansing. They deal with all the services. Local authorities are constantly accused of spending on buildings and lavish offices. My local authority has offices in Lugar. They are National Coal Board offices and modest by any standards. I challenge anyone to show me any authority in Scotland with more modest offices.
Cumnock and Doon Valley was commended by the hon. Member for Stirling and has a small administrative structure. We heard earlier about the need to keep down rates. Yet in 1981–82 that authority had a rate of 29p, in 1982–83 it was 31p and for the past two years it has been 33p. That is not an excessive burden on the ratepayers. Therefore, why has such an arbitrary calculation been used to impose penalties on that authority? I challenge the Minister to explain that. During Question Time I asked the Secretary of State to explain it but he could not. I asked him how that authority could meet the guidelines. I now ask the Under-Secretary to tell us how it can come down to the arbitrary guidelines if it is forced to do so. It does not intend to or want to come down to that arbitrary figure.
The authority is roughly on guidelines for refuse collection, libraries and other services. The one service on which it is allegedly overspending is burial grounds—[Interruption.] The hon. Member for Dumfries will be in need of one long before me. He represents a country area and should know the importance of burial grounds in the villages. My authority has spent £208,600 on the upkeep of its graveyards around the churches and its 14 cemeteries — one in each of the main villages. The suggested guideline—and this shows the stupidity and arbitrary nature of it—is £87,000. To reach that figure nine or 10 of the 14 cemeteries would have to be closed and people would have to be buried in other villages. That goes against the grain in our communities. Worse still, the existing graveyards could not be maintained. The House knows the anguish that that would cause relatives of the deceased.
Mr. Dennis Canavan: The hon. Member for Stirling (Mr. Forsyth) has an ideal solution to the problem — he would privatise the graveyards. Perhaps we could begin by trying him for size.
Mr. Foulkes: I am grateful to my hon. Friend.
622
I am surprised by the disdain on the face of the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley). Perhaps she has not received the sort of representations that I have received from local authorities and has not experienced the feeling of local communities on this matter. I shall give one more example to try to convince even the hon. Lady. The guideline of £87,000 is almost exactly the same as the figure spent by the predecessor authority before the reorganisation of local government 10 years ago. Yet we all know how costs have risen since that time.
Mr. McQuarrie: I am following the hon. Gentleman's comments on burial grounds with some interest. In the concise details that he has managed to acquire about the number of burial grounds and their locations, did he acquire figures for the income from burying people in the cemeteries that might compensate for some of the expenses incurred?
Mr. Foulkes: I know that the hon. Gentleman has some sympathy with the needs of the elderly. He must know that the death grant has remained at £30 for more than 20 years. Therefore, it is important to keep down the cost of burial as many people are finding it difficult to meet the expense.
During the past few years Cumnock and Doon Valley has not increased its staff, has had low overheads, has kept down rates and, in the Secretary of State's terms, has been a model authority—yet it is being asked to make a massive cut. That shows that the guidelines cannot be fair and that we must vote them out tonight.
8.28 pm
Mr. Albert McQuarrie: The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) said that he found it difficult to follow my hon. Friend the Member for Fife, North-East (Mr. Henderson), and I find it difficult to follow his road of burial grounds, as I might not come back again. The hon. Gentleman did not answer my question about income from burials. I fully support his comments about the death grant and the need for it to be dramatically increased. However, the hon. Gentleman will admit that whether or not the death grant is £30, the cost of a funeral is far greater than that.
I wish to deal with the position of the authorities in my area and I make no apology for being parochial in this. It is a matter of considerable satisfaction to see in annex 1 to the report that Grampian regional council did not exceed its guidelines last year. That is greatly to the credit of its officials and the work that they did to ensure that the guidelines would be met. This meant that the council warranted no penalty, but that result was achieved only through the best of husbandry, not just by council officers but by the convenors of the various committees who were forced to cut their budgets dramatically, despite major infrastructure needs arising from the considerable increase in population.
I do not believe that it is possible correctly to assess a guideline for such an area and it is quite wrong that the council should be forced to observe the guideline produced by the Secretary of State. The financial convenor of that Conservative-controlled authority has given an assurance to the electors of Grampian region that every step will be taken to keep within the guidelines this year, as in past

623
years, but on the basis of the figures in annex 1 and the amount of money to be made available to the council I fear that he will find it extremely difficult.
Like my hon. Friend the Member for Aberdeen, South (Mr. Malone), therefore, I ask the Minister seriously to consider the circumstances faced by Grampian regional council. It is not all gold up there, as some people seem to believe. The authorities there require just as much assistance as others. So far, however, Grampian regional council has done very well and has managed to avoid any penalty in rate support grant.
The council that I represent most, however, is Banff and Buchan district council. On the last occasion, the Minister informed the House that that local authority was to be penalised to the extent of £237,524 because it had exceeded the guidelines. The district council contends, however, that for various reasons the base year chosen was very low in terms of actual expenditure and the guideline for 1984–85 was thus much lower than would have been appropriate. I hope that the Minister will take particular note of that.
The guideline for 1985–86 has been substantially increased. In effect, that guideline is the budget presented by the council for 1984–85 plus 4·5 per cent. For 1984–85 that budget was regarded, to use the jargon, as "excessive and unreasonable" and it was alleged that the council had exceeded the guideline and should thus be penalised by the loss of rate support grant. Yet apparently the same budget is regarded as a sensible basis on which to calculate the guidelines for 1985–86. If the people of Banff and Buchan are as confused as I am, I hope that the Minister will be able to clarify that.
In a letter to me today my hon. Friend the Minister answered queries that I raised with him about this on 3 and 10 October. Severe problems arise because for a small rural district council, many of which are represented here, £237,000 is an immense penalty. My hon. Friend replied that in both 1984–85 and in 1985–86 a guideline had been issued which would enable the authority to maintain its present spending level. That may be his view, but it is not yet the view of the local authority, which still cannot understand why its budget for 1984–85 should be regarded as satisfactory for 1985–86 but subject to a penalty of £237,000 the previous year. My hon. Friend says that the guideline is intended to recognise the authority's expenditure record and that in 1984–85 the authority had budgeted to increase its expenditure in real terms, which would inevitably take its budgeted expenditure beyond the guideline and thus make it liable to a grant penalty. The £237,524 is the amount of penalty still in dispute.
My hon. Friend states in his letter that if the authority manages to reduce its actual expenditure for 1984–85 the penalty may be reduced or even cancelled. The district council had to report its actual expenditure by 14 September 1984. Yet it will apparently take until autumn 1985 for the Scottish Office to determine that there has been no overspending on the guidelines and thus to repay the amount of the penalty.
Mr. Canavan: Will the hon. Gentleman comment on the mathematical formula used by the Secretary of State whereby the weight factor is A multiplied by B to the power of O.1? What are A and B in the case of his authority and what is his own weight factor? [HON. MEMBERS: "Fourteen stone."]
Mr. McQuarrie: Hon. Members are clearly more concerned about my personal weight, but the weight factor of my local authority is the burden that I bear in trying to get as much rate support grant as possible for it from the Secretary of State. The formula on which I operate is that of continually writing letters to the Minister to show that I am pursuing the best interests of my authority and I shall continue to do that. I hope that that answers the hon. Gentleman's question, which I suspect was largely a frivolous one.
Once the Government have said that the cash is to be taken away from the local authority, the ratepayers in the district are the sufferers. The only encouraging thing which my hon. Friend the Under-Secretary said in his letter to me was that Banff and Buchan district council will not be liable for any grant penalty for 1982–83 or 1983–84. I ask my hon. Friend to look at the time factor, which I have mentioned, when he assesses the actual expenditure of the district council, and to make sure that if a penalty is imposed for any given year and paid, it should be repaid very quickly if it transpires that it was invalid.
Mr. Ancram: The year 1984–85 goes on to the end of the financial year, which is at the end of March next year. After that we have to wait for the returns from the local authorities to see what their actual outturn expenditure has been. Not until about the late summer do we have that information. We can get indications before that time, but before the final decision can be made as to whether a local authority has come within the guidelines by making reductions, we have to wait for all the information to be available.
Mr. McQuarrie: I am grateful for that explanation, but in that case the Government are acting like a pawnbroker, and taking the money before they hand the goods back. If an authority is assessed on the basis of its anticipated expenditure, based on the budget provided by the local authority to the Secretary of State, and that budget is in excess of the guidelines prepared by the Secretary of State, why should he collect the cash if the fiscal year has not ended or will not end for a considerable number of months, penalising the ratepayers of that local authority by taking away the money as he intends to do m this instance? To my mind, that is sheer robbery.
If my hon. Friend is to penalise the authority, he must come up with a much better system than is at present proposed. If there is to be a guideline and the local authority then produces a budget, there should be direct discussions between the local authority and the Minister's Office, and it should not be the case, as my hon. Friend told me today in his letter—my local authority of Banff and Buchan having asked for a. meeting—that:
"It is not possible for a meeting to be arranged".
The hon. Member for Carrick, Cumnock and Doon Valley has told us that his authority has had a meeting with my hon. Friend.
Mr. Foulkes: No, I said precisely the opposite. The authority is very upset because it has not been granted a reply to its letter—let alone a meeting—even though the Under-Secretary had managed to traipse down to Nithsdale.
Mr. McQuarrie: I thank the hon. Gentleman. My hon. Friend tells me that:

625
"It is not possible for a meeting to be arranged between the Secretary of State and representatives of the Council since the questions they want to discuss are matters which the Secretary of State discusses with the Convention collectively."
I accept that there are representatives on COSLA from the various local authorities but, with the greatest respect, I would suggest that the authorities are all different. A local authority such as Banff and Buchan is in a different category from the city of Glasgow. It should be entitled to present its case to the Minister. I am sure that, when COSLA meets, it is not possible for every local authority to present its individual case to the Minister. I accept that such a proceeding would take up a great deal of the time of the Ministers and officials of the Scottish Office, but it is incumbent on the Ministers to deal with local authorities fairly by meeting them and letting them put their point of view. That is particularly so in the case of local authorities such as Banff and Buchan.
I hope that the Minister will consider what I have said. I should also like to comment on the question put by my hon. Friend the Member for Aberdeen, South about the consultations with organisations apart from the local authorities' representative members. My hon. Friend seemed to suggest that it was not correct to hold such discussions. I believe that the local authorities should consult organisations outside. I am sorry to say that Moray district council and my own district council have decided not to seek consultation with organisations. I regret that, because the small businesses in particular are having to foot the high rate bills being imposed by the local authorities.
I hope that although my right hon. Friend has no legislative power to call on local authorities to hold discussions with other organisations, he will advise the local authorities—by letter, if necessary—to embark on some form of consultation.
Mr. Canavan: Support?
Mr. McQuarrie: Cautious support. I do so in the hope that the Secretary of State will take account of the problems of district councils in rural areas. Banff and Buchan district council is making every effort to reduce its expenditure in the current financial year, and I hope that the excess of expenditure over the guidelines will be less when the accounts for 1984–85 are finalised. In these circumstances, every effort should be made by my right hon. Friend to support the rural districts because of the particular problems which they face, which are many and varied. Those authorities stand in contrast to the high-spending urban authorities where the motto seems to be "spend, spend, spend," regardless of the guidelines. By all means, let my right hon. Friend clobber those high-spending authorities, but let him look with sympathy on the rural district councils which are trying to do the job that he has asked them to do.
8.46 pm
Mr. Tam Dalyell: I find it somewhat distasteful to indulge in what may seem to my colleagues on both sides of the House to be special pleading, but I should like to raise the question of the serious anomalies suffered by West Lothian district council. This is not a question of yah-boo politics. The problems arise, as the Under-Secretary may know from the time when he was a
626
candidate in West Lothian, from the fact that Livingston is growing and has grown at an unprecedented rate, and the amounts fixed for West Lothian district council do not take that into account.
My hon. Friend the Member for Livingston (Mr. Cook) and I had a long meeting with the excellent and able district councillors of West Lothian. I hope that I may, without being invidious, mention the names of the officials. They were David Morrison and Stanley Stirton, who are extremely able people and have good relations with the Scottish Office.
West Lothian has suffered since 1979–80 from a ridiculously low revenue guideline. Repeated efforts have been made to change this. The gross unfairness is illustrated in paragraph 6.5 of "West Lothian—Villain or Victim?"—a document of which the Scottish Office has a copy. The arguments were first put to the Secretary of State in February 1983. Because of the inequitable guideline figure, the ratepayers of West Lothian suffered considerable losses on rate support grant despite the fact that the local council had reasonably drawn attention to the situation in successive years. No action has been taken. The ratepayers suffered because of an inflexible and arbitrary guideline. In 1984–85 the system moved to the client group method—based on objective factors —to determine the council's expenditure need, and there was a heavier reliance on population. West Lothian's expenditure need figure for 1984–85 is £8,692,000. However, because the Secretary of State had to find a way to transfer guideline money within the overall total to other councils with previously high guidelines, West Lothian suffered a reduction of £551,000 to bring it to its revenue guideline of £8,141,000. Other councils have a guideline above expenditure need; West Lothian's is below. The gross unfairness is that RSG penalties start at the guideline. West Lothian's budget in 1984–85 is £8,258,000 — clearly below the Secretary of State's calculation of expenditure need—yet the West Lothian ratepayers suffer a loss of £80,000, purely because of their willingness to show reasonableness in the past. That is why the council feels rather strongly. Incidentally, Dunfermline district is in exactly the same circumstances.
Despite representations, and the courteous hearing that they had from officials early in 1984, that the penalties should start only at expenditure need, the position remains basically unchanged for 1985–86. That is why I am speaking with such urgency. The council's expenditure need figure calculated by the Secretary of State is £9,376,000 and yet our guideline is again set £552,000 lower, at £8,824,000. Under the present system, penalties will start at the lower figure and he has indicated "considerably more severe" penalties next year. If the Minister would like to interrupt to say that, at a recent meeting, the problem has been resolved, I shall sit down. I do not think that he can say that.
Why should the ratepayers of West Lothian be required to suffer losses of grant when the Secretary of State is using different and higher expenditure standards for other areas? Why should the ratepayers of West Lothian suffer losses when the council — a reasonable council — is spending at a level more than £400,000 below the expenditure need figure determined by the Secretary of State? West Lothian has lost £80,000. Is that not rather unfair? Does the Secretary of State realise that West Lothian has the highest population and dwelling growth in Scotland and that there is no reflection of this in his basic

627
calculation or his arbitrary reduction of expenditure need? This is back 15 years to the Livingston problem. Why has the Secretary of State not made any move to close the gap in 1985–86 between expenditure need and guideline? Will he accept that it is only fair and reasonable to the ratepayers of West Lothian that penalties should only start if the council exceeds expenditure need?
In the light of the important discussions taking place about the level of unemployment in Bathgate and surrounding areas, will the Secretary of State accept that it is grossly unfair to penalise a council on a guideline below expenditure need? Does he agree that West Lothian requires special help through its guideline or expenditure need to deal with the problems of the area? I am worried principally about the 1985–86 figures.
The background to housing capital expenditure is as follows. Because of the limited allocations in this year, the council made a special approach for an extra allocation to cope with these problems. No positive response has yet been received to these overtures. The position is exacerbated because the Scottish Development Department anticipated that £3·6 million of capital receipts from council house sales would be forthcoming in 1984–85 —presumably in light of higher discounts. This is not forthcoming and a shortfall of capital receipts is more than possible. I am told by John Spraggon, the housing director, that it could well be £1 million. Whatever my political views might be, the fact remains that the council has played perfectly fairly by the Government's standards. There have been no artificial inhibitions on the sale of council houses. I give the Secretary of State that undertaking.
Will the Secretary of State undertake to make good the major shortfall in his estimate of capital receipts by authorising additional allocations to the council? The implications for 1985–86 could be serious. If the allocations for 1985–86 are related to the net figure of allocations in the current year — the implications for investment in maintaining the housing stock are very serious. In West Lothian the levels in 1984–85 are as follows: gross allocation £4·8 million, less SDD estimate of receipts £3·6 million, actual allocation £1·2 million. Will the Secretary of State undertake to ensure that true levels of investment in housing stock in 1985–86 are commensurate with the need and not deflated by overoptimistic estimates of capital receipts from council house sales?
The special report on the problems of Bathgate and surrounding area to deal with the massive level of unemployment is expected soon. The ability of the district council to respond and play its part is heavily conditioned by the overall levels of capital allocations for housing services and general services and, more importantly, by the limit of the revenue guideline. Does the Secretary of State accept that the problems of Bathgate urgently require that the local council should receive special consideration and allocations to assist it to meet the problems?
This matter is all about the fact that there were anomalies in the past. Can the Minister give an undertaking that the Department will again meet West Lothian district council to sort the problem out? If I have read quickly from a brief, it should be borne in mind that it is the background to a good deal of work—I make no apology for it—and meetings that my hon. Friend the Member for Livingstone and I have had with very serious people.
8.55 pm
Mr. Charles Kennedy: Like others, I wish to raise some local matters, that affect Highland regional council and local authorities throughout the Highlands. We are grateful that the Minister took the time and trouble during the summer recess to meet councillors and officials of Highland regional council in Inverness. He heard first hand about some of the problems, financial and otherwise, that they face. When that council learnt from a statement that was made earlier this year that it would have to bear £2·3 million of the £90 million that was originally envisaged, it was deeply shocked and worried about what would happen. Since then, matters have improved somewhat, although that is mostly because of money from oil-related grants. Nevertheless, there is still anxiety about the client group approach and how its financial allocations will be made.
As time is short, perhaps I might ask whether the Minister would be so good as to say in writing how the adjustments to which the Secretary of State referred today will affect Highland regional council. We accept that, subject to further budgetary revisions, there are likely to be more adjustments to the levels of penalty that have been allocated.
Several hon. Members, including the hon. Member for Banff and Buchan (Mr. McQuarrie) who accused the Minister of sheer robbery—it is interesting that a sheer robber should still qualify for Conservative support — emphasised the considerable anxiety in rural areas about the methodology of the client group approach. We have made representations previously to the Minister about the assessment formula and the way in which it is used to determine guideline expenditure. Given the specific problems of the authority of the right hon. Member for Western Isles (Mr. Stewart), and those in Highland local authorities, the areas of leisure and recreation, and of roads and communications generally are not given. sufficient support. Under its present workings, the client group approach does not appear to give sufficient consideration to those areas. I am sure that that view is shared by all hon. Members.
The current position within the Highland regional council shows a projected deficit of £500,000. That is not inconsiderable and is especially significant in such an area. I hope that the Minister will tell the House the effect that his statement today and further discussions are likely to have.
I listened to contributions from the Secretary of State, from other Conservative Members and from Opposition Members. Although their solution to the problem is different and varies in the degree of the draconian measure to be adopted, all hon. Members appear to agree that local government is too dependent on central Government for its finance and that the root of the unhealthy problem is that historic fact. Although we shall have spent five hours debating the matter I doubt whether the Government's thinking will have changed substantially. That underlines the fact that local government must be loosened from the Scottish Office, expecially in terms of its financial dependency.
Many of these issues would be better debated, not in Westminster but by a fully elected Scottish Assembly sitting in Edinburgh. As we already have many such debates a year, I hope that the Conservative party will come to realise that a more autonomous, locally

629
accountable and financially independent local authority structure is something to be not scared of, but welcomed. It would remove the burden from Ministers and hon. Members and put the decision making and accountability, which the Government say they are so worried about, back into the hands of ratepayers.
I hope that the Minister will give me specific answers to the specific queries which affect the Highlands, and that in due course his thinking and that of the Conservative party will be liberated on local government in Scotland.
9.3 pm
Mr. Norman Buchan: Greater love hath no man than that he surrender his place to his hon. Friend in the order of speaking. I am glad to have five minutes of speaking time.
I had intended to ruminate at great length on the economic and financial heresies of the hon. Members for Fife, North-East (Mr. Henderson) and for Stirling (Mr. Forsyth). The kernel of their heresies has always been the mainspring for the propaganda slogans under which this battle is waged against local authorities. They commit almost every possible heresy.
We must consider the matter from three or four different stances. First, Government policies have expanded local authorities' needs. It is no use saying that the fact that expenditure has increased proves that there has been overspending. It does nothing of the kind. It is proof of the increasing complexity of society. An increasing level of public expenditure has been, is and will continue to be essential. The policies of the Government, with their exacerbation of almost every possible social problem, have increased needs. Whenever a local authority feels the need to expand its expenditure in real terms, let alone in cash terms, it is because Government policies have increased needs.
Secondly, there are no local authorities which are overspenders. There are underspenders, but no overspenders. When we consider the magnitude of the problems in housing, health, social work, transport and education, it is clear that no local authorities are overspending. However, there are some which are underspending.
The third theory is that, as a result of change and development since the growth of our cities, they face special problems. Therefore, when we talk about an estimated overexpenditure in Strathclyde, which covers many of the conurbations in Scotland, we must remember that we are dealing with Victorian sewers as well as Victorian highways and planning.
The next theory that is put forward by Conservative Members is that those who try to defend their communities and who recognise the truth of what I am saying are lawbreakers. I ask Ministers again: which law are they breaking? [Interruption.] Perhaps the Minister would pay some attention to what I am saying; he can deal with the timetable afterwards. I ask him again: which law are those local authorities breaking? That is another myth peddled by the Government.
If each local authority fixed the rate determined by the needs of its area, there would be no need for the Government to use such draconian policies of penalty. There would be means to deal with local authorities, if the Government believe that they are wrong, which fall short of penalising them. The truth is that the Government are
630
forcing authorities to break the law, but curiously they will not prosecute them for doing so. They are the laws that establish statutory duties upon local authorities in relation to homelessness, social work and education. If the local authorities obeyed the Government's so-called guidelines, they would be guilty of breaking those other laws. On which law will the Government prosecute: the laws on education, social work and health, or the laws for the protection of the ratepayer? The Government know that this is yet another heresy that they have put forward.
The hon. Member for Stirling has returned to the Chamber. What has St. Andrew's done to Scotland with this new school of philistines emerging from the university, of which the hon. Gentleman is one of the least reputable examples? He is the man who believes that the Women's Rural Institute is riddled with Marxists; he has called for the privatisation of prisons, no doubt on the same premise as he wishes to sell council houses—that the sitting tenants get priority and a discount. He advocates the privatisation of the fire service and the Health Service, and at the same time his is the public relations agency for the firm of Pritchards, which is the main firm seeking contracts with the NHS when it privatises operations. I wish that he would declare his interests every time he declares his economic theories. It would be helpful to us. That is the background to the heresies.
We heard a spokesman from a rural area who told us about revolution in Nithsdale. I remember a Stanley Baxter sketch which opened with a Che Guevara-type guerrilla surrounded by jungle and a long interview taking place with a BBC interviewer, who was then led blindfold from the cave in the jungle. As he went out, he said, "And remember, this would not be so disturbing if it were not all happening in Wiltshire." The opening words of the hon. Member for Stirling were that local authorities are all becoming delinquent, but that is nonsense. Far from hearing such insults, local authorities that defend the needs of their communities against the worst of the deprivations heaped upon them by the Government deserve the badge of honour.
In my area, the Talbot works closed three years ago. Has that not added to the costs of local authorities? We are told this week that another 470 people are likely to be made redundant from the Bishopston royal ordnance factory as a prelude to the privatisation that the hon. Member for Stirling seeks. A total of 470 families will be put on the dole. Will that not increase the cost to local authorities? To say otherwise is nonsense, and the Government know it. They have declared war on community after community and on the mining villages. In the front line they are using a series of myths, peddled by some Conservative Members, to try to encourage them in their quest of destroying the nature of some of the communities which have been built up over the years. All honour to any local council which defends its community. Let us understand what such councils are about and support them.
9.10 pm
Mr. Dennis Canavan: We have heard this debate umpteen times before, so I shall be brief.
Earlier this year we discussed the Rate Support Grant (Scotland) (No. 1) order. The majority of Scottish Members voted against it because we felt that the amount

631
of financial assistance offered to Scottish local authorities was hopelessly inadequate. The Government maintained that local authorities were overspending.
A few months later, that was put to the test in the Scottish local authority elections, when Labour enjoyed landslide victories throughout most of central Scotland and further afield. Not only did we consolidate our position but we improved our representation at district council level. Yet now, having lost the argument in the May elections, the Secretary of State has the brass neck to come forward with a proposal to rob these local authorities of a further £90 million.
The right hon. Gentleman is doing so because apparently his guidelines have been breached, and not just by a few local authorities as was the case in relation to the selective action which the right hon. Gentleman has taken in previous years. About 75 per cent. of Scottish local authorities have put forward budgets in excess of his guidelines. I understand that on average Scottish local authorities are 4·2 per cent. above the guidelines, although that figure varies from one area to another. For example, the Central regional council is only 3·4 per cent. above the guidelines, whereas Falkirk district council is 7·7 per cent. above.
Originally these guidelines were intended as mere guidance, but now they appear to be mandatory. The Secretary of State is taking it upon himself to impose them on local authority expenditure, despite the fact that central Government cannot hold a candle to local Government in meeting expenditure guidelines or projected expenditure limits. Local government's record is far better than that of central Government, yet the Secretary of State proposes to penalise Scottish local authorities. He tries to justify this by all sorts of weird mathematical formulae, such as A times B to the power of 0.1. But when all these formulae are translated into human terms, they mean cuts in services for many people. They mean deprivation of educational opportunity for our children and for our students in the colleges of further education. They mean cuts in the standard of social work services for the elderly, sick and disabled, and an increase in council house rents.
Conservative Members may say that housing finance is not concerned so much with rate support grant as with housing support grant, but I remind them that many Scottish local authorities are getting not a penny in housing support grant. For the past two years my local authority —Falkirk district council—has received not a penny in housing support grant.
Mr. Michael Forsyth: Why?
Mr. Canavan: Because this Government are one of the meanest, dirtiest, rottenest Tory Governments in history.
The councillors elected in May, or the regional councillors who were elected in May 1982, have in all instances a far better mandate to decide the priorities of the people of Scotland than a Secretary of State whose party was rejected by over 70 per cent. of the Scottish electorate at the last general election. I and other hon. Members have frequently made that point. This order is yet another nail in the coffin of local democracy. If the Secretary of State were being absolutely honest he would, as his colleague is doing in London, bring forward a Bill to abolish local government in Scotland, or go to the limit advocated by extremists such as the hon. Member for Stirling (Mr. Forsyth) and privatise all local authority services. Instead,
632
he is using the sneaky method of using his overall majority in the House of Commons to push through, at the dead of night, legislation that is completely contrary to the wishes of the majority of elected representatives of the people of Scotland.
If Conservative Members believe in parliamentary democracy and the continuation of the imperfect model of parliamentary democracy that we have in this country, they should remember that one of the fundamentals of representative democracy is that the people who are being governed by laws should consent, in some way, to such laws. Increasingly what happens in this place is what will happen tonight. The majority of the elected representatives of the people of Scotland will vote against legislation—whether it is primary legislation or secondary legislation such as this. Despite that, Tory Members in the bars of this place or sleeping in the Library, will come crawling out of the woodwork into the Lobby in half an hour's time to vote against the majority wishes of the elected representatives of the people of Scotland. If that is the style of parliamentary democracy in which this Government believe, woe betide them—they will not survive, and the people of Scotland will make sure of that.
Therefore, I shall encourage maximum resistance by our councillors, particularly Labour councillors in Scottish local authorities, who were elected on a far better mandate, and are far more responsive to the needs and aspirations of the people of Scotland, thatn this discredited Secretary of State and his Government. I hope that hon. Members representing Scottish constituencies will give maximum support to these councillors so that they can use every legitimate means at their disposal to resist these measures and to fight the Secretary of State all the way, in the interests of the people whom they—and we—were elected to represent.
9.18 pm
Mr. Jim Craigen: It was inevitable that many of the arguments in today's debate had been heard earlier in the year when the House debated the original rate support grant order. Many of us maintained then—and equally do so today—that that order was inadequate for the problems with which Scottish local authorities are having to cope.
Many pertinent speeches have been made today about the effect of the Secretary of State's intended cuts. He is proposing to take back £90 million of an already inadequate rate support grant settlement. No wonder the hon. Member for Banff and Buchan (Mr. McQuarrie) was kept out of the Committee on the Rating Valuation (Amdt) (Scotland) Act this year. He brought out forcefully, as the "Bulldog of Buchan" often does, the effect of the assessment of the penalties on the original estimates. I thought that his analogy of a pawnbroker was a good one. My hon. Friend the Member for Falkirk, West (Mr. Canavan) put the point more stoutly when he talked about sheer robbery, because that is what is proposed today.
There were times when it seemed more like a parliamentary scrum than a parliamentary scrutiny of Scottish local authority affairs. This Chamber simply cannot give the detailed scrutiny of the affairs of the 65 local authorities that is required. That job should properly be done in the council chambers by the people who were elected in the first instance to serve in the regional, the district and the island authorities.
Mr. Malone: Will the hon. Member give way?
Mr. Craigen: No, I will not, because the hon. Member was quick off his mark after he made his speech earlier this afternoon. I watched that.
An essential feature of the running of local government is a measure of stability. My hon. Friend the Member for Monklands, West (Mr. Clarke) put it very well when he said that the biggest problem facing Scottish local authorities is the constant chopping and changing of grants and policies by the Government. It makes it very difficult for local authorities to plan.
The local authorities cannot be held responsible for the economic policy. That is the responsibility of the Government—and what a mess they are making of the present economic situation. The Government have the substantial say over the policies required to control inflation, interest rates and wage settlements. Central Government already have very substantial pincer powers on the local authorities by setting the rate support grant and the targets with which the local authorities have to comply.
Increasingly, local government is being pushed into the front line of Government economic policy at a time when the pound is at the lowest level ever against the dollar, when unemployment is at an all-time high, and when taxation is higher now under the Tories than the level of taxation that the Government complained about when they first came to office in 1979. The burden is being steadily moved by the Government on to local shoulders. The Government have done more than most Governments to shift the burden on to local taxation and the ratepayers, despite all the nice words that right hon. and hon. Members on the Government Front Bench say to the contrary.
What is the view of Scottish Office Ministers concerning the Audit Commission for local authorities in England and Wales? I know that it does not have a remit in Scotland but it makes some very interesting points about the way in which the Government are not achieving their declared objectives because of the way in which they are operating the distribution of the block grant system.
The Commission points out very aptly the uncertainties which the present block grant system creates. It refers to the fact that some local authorities in England have been building up reserves to meet uncertainties. It talks, as several hon. Members have talked, of the constant uncertainties over the revised percentages and targets which the Government impose on local authorities.
Above all, I thought it significant that the report, which is quite a thorough one in its way, brings out the lack of knowledge and clarity on the part of the general public about the way in which their own local government system works. It deals with local accountability. The Government, because of the way in which they are pursuing their policies vis-à-vis local authorities, will be unable to get proper accountability at local authority level.
My hon. Friend the Member for Falkirk, East (Mr. Ewing) talked about a myth pursued by the Government in relation to the fact that councillors do not feel a sense of responsibility to their local authority and their electors. Local market forces are an important feature of the present monitoring of local government commitments.
The right hon. Member for Western Isles (Mr. Stewart) highlighted the fact that we are dealing with a system that must be sensitive to the needs of local communities. It is a care-intensive service, provided, by and large, by the local authorities. They have to look after the schools, old people's homes or childrens' homes. There are many other
634
duties that they must carry out, which involve people and family life. It is also a staff-intensive service. It is all very well for folk to talk about other people losing their jobs. As the recent manpower figures show, in the past year there has been a reduction in the number of people working for local authorities. If the hon. Member for Aberdeen, South (Mr. Malone) looked at the papers published recently by the Scottish Office, he would see that there has been a 0·5 per cent. reduction——
Mr. Malone rose——
Mr. Craigen: If the hon. Gentleman will be patient, I shall tell him that one of the increases was in the number of staff who had to be taken on to cope with the housing benefits legislation that the Government introduced. If ever there was an unmitigated disaster, it was the imposition of the housing benefits legislation and the way in which local authorities have to deal with it.
Mr. Malone: Will the hon. Gentleman give way now?
Mr. Craigen: Against my better judgment, I shall.
Mr. Malone: Will the hon. Gentleman concede that when the Labour party was in government, it chopped local authority jobs by 9,000 in one year, and that between 1977 and 1984 there has been an increase in establishment of 4,200? How does he square that with the fact that we are cutting jobs?
Mr. Craigen: I listened to the hon. Gentleman's speech. Although he was entirely in favour of the client group approach, I notice that he had special pleading about its effects on his own area because of growth in that area. Other areas are experiencing decline. My hon. Friend the Member for Linlithgow (Mr. Dalyell) clearly brought out the differences in his area between the Livingston new town development and older areas.
The hon. Member for Aberdeen, South knows that local authorities must tailor manpower levels to the needs of the area. After all, the number of young people in school is in decline but the number of elderly people in our community is on the increase, so one must make adjustments. The hon. Gentleman should not forget that there was a changeover in the system of local government, and quite a few people took premature retirement. I believe that the manpower figures are now kept a lot better than they used to be.
The Convention of Scottish Local Authorities, the spokesman for local authorities in Scotland, made it clear in its statement that if Government support had not been reduced in 1984–85, the rates would have been kept at the 1982–83 level. There is no need to go over the ground that we discussed when the original rate support grant settlement, unfortunately, was approved by the House in January. We know that the Government did not keep pace in their settlement with the rate of inflation or the changes in interest charges. We know also, because the hon. Member for Aberdeen, South brought it out himself, that demographic changes are having their effect on the way in which the client group approach is devised. A new element should come into the settlement of the rate support grant. It should take proper account of the differences in income levels in different parts of Scotland. Inevitably, with more people unemployed the level of purchasing power in an area is depressed and the demand for support services in local authorities is increased.

635
The hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) referred to the important area of leisure and recreation. We should not underestimate the importance of leisure and recreation at a time of rising unemployment, which Ministers tell us will not drop much. The Government should accept that, paradoxically, there is an opportunity to create jobs in the provision of leisure and recreation as well as a social imperative.
If I refer to the hon. Member for Aberdeen, South again it is not because he made the most interesting speech but because it is suitable to the argument that I now adduce. He called for rates reform. Some of us thought that he was a hard man but when he called on Ministers for rates reform I thought that he was a hit of a dreamer after all. When the Secretary of State for the Environment addressed the faithful at the Tory party conference he must have been stuck for something to say because he said that he would appoint three wise men—the Minister for Local Government, the Under-Secretary of State for the Environment, the hon. Member for Bristol, West (Mr. Waldegrave), and the Under-Secretary of State for Scotland, the hon. Member for Edinburgh, South (Mr. Ancram) — to study the reform of local government finance.
I wrote to the Secretary of State for Scotland recently asking whether valuation would be one of the factors to be taken into account in the review of local government finance. My hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), I and many others spent endless hours on the rating and valuation legislation earlier this year. The Minister assured us that that Bill would iron out all the problems and disparities that existed between Scotland and England over valuation. On 22 October the Under-Secretary of State replied to me saying:
"Kenneth Baker, William Waldegrave and I will be looking at the system of local government finance. I note your suggestion that valuation for rating should he one of the topics we examine."
Open-mindedness is always welcome but here is an admission of empty-mindedness. I suspect that the three wise men will have some difficulty in coming up with a scheme of things.
The Scotsman has been referred to so often that I must refer to it again. An interesting article today by David Mercer pointed out just how anxious industrial and commercial property owners are about impending revaluation. The disparity between English revaluation in 1973 and the more up to date position in Scotland is significant. When the Under-Secretary of State replies, may we expect, or is he ruling it out at this premature stage, that industrial subjects will he in for a reprieve? Will commercial subjects be in for some form of rating relief? What will happen to Scotland's domestic ratepayers? We look for great things from this rating review.
The hon. Member for Dumfries (Sir H. Monro)—I always listen with respect to the senior Member for Dumfries—gave all the support to the Secretary of State that only an hon. Member whose own local authority is not affected by the order could. But he warned that there was a hint of rebellion in Nithsdale next year. I therefore wonder whether that local authority's convenor has read the letter that the Secretary of State somewhat unusually sent to convenors. I have only a layman's knowledge, so I shall defer to my hon. Friend the Member for Garscadden, but I was not under the impression that convenors had any statutory significance——
Mr. Dewar: They get the CBE.
Mr. Craigen: Not the one for Lothian! In his letter of 5 October 1984, the Secretary of State said:
"I intend that the penalty for any excess will be a good deal more severe than penalties have been so far."
That refers to 1985–86, yet we are not even out of 1984–85. The words of King Lear come to mind:
'I will do such things,—
What they are yet I know not,—but they shall
be
The terrors of the earth."
The Secretary of State may have frightened the teachers this morning when they met him, but I do not know what he will do to the local authorities. Perhaps he will show the same ambivalence towards them as those of us who have come to know the Secretary of State as well as we do are accustomed to. I have never yet known a speech by him on local government finance in which he has not alluded to the year 1976 and all that. Therefore, I keep close at hand the early-day motion on excessive burdens on ratepayers that the right hon. Gentleman signed.
Mr. Dewar: He sponsored it.
Mr. Craigen: The right hon. Gentleman did not sponsor it. The man who did not get the job sponsored it. That early-day motion acknowledged that
"the Government's reduction in the rate support grant for Scotland … merely transfers the burden of existing expenditure from central Government to the ratepayers".
If that was good enough for 1976, why all this double-dealing and double-talk in 1984?
The fact is that the Government determine which way the coin will spin. Under this Government, it is heads the Government win and tails local government loses. But whichever way the coin spins, the ratepayers will be no better off.
We oppose the order, which will reduce an already inadequate RSG settlement for 1984–85, and because it is part of the poisonous atmosphere that the Secretary of State and his colleagues are generating in the relationship between central and local government. We oppose it, because it will not ensure value for money, but will give only more headaches, problems and misery to the people of Scotland.
9.38 pm
The Parliamentary Under-Secretary of State for Scotland (Mr. Michael Ancram): I listened with interest to the hon. Member for Glasgow, Maryhill (Mr. Craigen) quoting King Lear, and I hope that he will remember that, if my recollection of Shakespeare serves me aright, King Lear died a horrible death. In placing himself in King Lear's shoes and quoting him, I hope that he will take a lesson.
The hon. Gentleman referred to the piece of paper that he keeps close to his heart and the famous year of 1976. But if he had looked behind him he would have seen that the face of the right hon. Member for Glasgow, Govan (Mr. Millan) was more embarrassed than any face on the Conservative Benches. If he wishes the obviously close relationship that has existed for some time between the right hon. Gentleman and him to continue, the less he uses that piece of paper the better.
We have had a full and wide debate on the order. Before I deal with issues that have been raised, I remind the House of the essential purpose of the order. Its purpose is to reduce by £90 million the rate support grant payable to Scottish local authorities in 1984–85 to put pressure on

637
them to reduce their expenditure. The reduction in grant is shared among authorities in a way which differs significantly from what happened in previous years and provides a real incentive to authorities paying penalty to reduce their expenditure.
The penalty on budgets reflects individual levels of over-spending and is at a higher rate for authorities spending furthest above guidelines. But outturn penalties will be reduced if expenditure is reduced. I emphasise the double financial benefits of reducing expenditure. Not only will the grant penalty at outturn be recalculated on the basis of a lower figure overspending, but it will be recalculated at a lower percentage of that overspending. The hon. Member for Falkirk, East (Mr. Ewing) will be interested in the effects of that on the formula. The closer authorities come to guidelines, the lower the penalty tariff. If authorities come down to guidelines, as I hope they will, the penalty will be cancelled altogether.
The end result of the improvements should be a marked reduction in overspending in 1984–85 which the Government can recognise by reducing penalties. There is no reason why the penalty of £90 million should not be substantially less when it comes to the review of the penalties at outturn.
Mr. Wallace: I notice that the report to which reference has been made says that the review may take account of changes in interest rates which will affect repayments by local authorities. I am sure that the Minister realises that a large part of the Shetland council expenditure is on repayment. What are the Government's proposals if an increase in interest rates takes place between now and the beginning of the next financial year?
Mr. Ancram: As the report says, interest rates will be taken into account. It is important not to speculate on what interest rates might be. In relation to the hon. Gentleman's constituency, the part of the report to which he refers holds good.
I shall now deal with the speech made by the hon. Member for Glasgow, Garscadden (Mr. Dewar).
Mr. Ewing: Will the hon. Gentleman give way?
Mr. Ancram: I do not have much time, but I shall give way later.
The hon. Member for Garscadden effectively summed up the Opposition's view and I shall deal with what he said in detail.
Mr. Ewing: Will the hon. Gentleman give way?
Mr. Ancram: I shall give way, but the hon. Gentleman's comments are rarely important.
Mr. Ewing: I can assure the Minister that my comments are always more important than his answers. The Minister said that the penalty will depend on outturn figures. Does that mean that no penalty will be imposed upon any local authority in Scotland until the outturn figures are known, possibly a year from now? Am I right in thinking that the £90 million will not be affected until the outturn figures are known?
Mr. Ancram: I am sorry that I gave way because the hon. Gentleman has merely confirmed that he does not understand the system. The penalty has already been taken from local authorities in the rate support grant payments
638
made to them on a monthly basis. If an authority were not penalised until a year after the offence, the anomalies would be more serious than those which are said to exist now. The hon. Gentleman's suggestion is utter nonsense.
Listening to the hon. Member for Garscadden, I am led to believe that years in opposition inevitably lead to exaggeration. One would have believed, listening to the hon. Gentleman, that never has local government in Scotland been so financially pressed, so cut to the bone and so near to expiry.
As my hon. Friend the Member for Dumfries (Sir H. Monro) and others have said, who would have believed that the level of expenditure, even on the most conservative view of real terms and taking into account inflation, actually remains ahead of the level in existence when the last Labour Government left office? It is 2·6 per cent. ahead in terms of local authority services and, compared with the normal rate of inflation, 12 per cent. ahead of the 1978–79 level.
Where were the Labour voices raised in protest at the despicable way in which their Government were destroying local government in Scotland? Where were the guilty admissions from the then Government Front Bench — I seem to remember that the hon. Member for Falkirk, East was a member of that Government—that they were grinding Scottish local government into the dust? Far from making any such admissions, they were proudly proclaiming their support for the role that local authorities were playing. Yet, on a higher level of expenditure in real terms, what a different story we have had from them tonight. I doubt whether that is because they have higher expectations from a Tory Government. It could be because since they went into opposition they have abandoned any sense of national responsibility which they held when in government and are interested only in stirring every passing wave.
I hope with some confidence that the hon. Member for Garscadden never becomes Secretary of State for Scotland, because he would suffer fatal indigestion from swallowing some of the words that we heard from him today. I suspect that, as a man of some intellectual honesty, he is thoroughly embarrassed by his performance.
The hon. Member for Garscadden questioned the validity of the current expenditure guidelines. I listened closely to what he said, but I remained unclear about whether he was questioning the total amount of the guidelines of the methodology. I remind him that the methodology has been worked out over a long period by a working party on which COSLA was represented. It is generally accepted that it provides a fair system of assessing need and a system on which rate support grant distribution and the guidelines can be based.
I can tell my hon. Friend the Member for Fife, North-East (Mr. Henderson) that we are always looking for ways in which the system can be revised and improved. That work is continuing. In setting guidelines for individual authorities, we also recognise that authorities must be presented with realistic targets in relation to their current level of expenditure. That factor is taken into account in arriving at the guideline figure.
The hon. Member for Garscadden mentioned the relevant expenditure for 1985–86 which has been distributed through the guidelines. It is worth reminding him that the sum has been increased by about £95 million. The hon. Member for Falkirk, East should remember that

639
the enhanced provision halves the gap between our plans and the budgets that local authorities presented to us through COSLA. The guidelines derived from the total figure present realistic targets to individual authorities.
The hon. Member for Garscadden was challenged by my right hon. Friend the Secretary of State on a matter on which he has so far failed to give an answer. I wish to put the question to him again. When challenged to state his position on the Labour party's conference decision to back local authorities that put themselves outside the law, the hon. Member for Garscadden remained silent. It is to my regret and, I suspect, to his shame that he has remained silent. Perhaps he would like to tell us his position now.
I recall occasions when I have taken part in broadcasts with the hon. Member for Garscadden when, courageously and often in the face of militant sentiment in his party, he has stated that he did not condone and would not support local authorities going beyond the law. Of course, those broadcasts were pre-Blackpool, pre-Scargill and pre-the shadow Cabinet elections. While, in Lord Acton's words, power may corrupt, a militant Labour party and elections to office within it can obviously bend even the most deeply held principles. It is a sad reflection on the hon. Member for Garscadden, and I hope that he never again preaches to me about his belief in the rule of law.
A large number of points have been raised during the debate and, obviously, it will not be possible to deal with them all now. I shall deal with one or two of the points and will write to hon. Members who raised other questions. Especially I shall reply in writing to the hon. Member for Linlithgow (Mr. Dalyell), who asked a series of detailed questions. I am sure that he will agree that it would not be appropriate to take up the time of the House in answering each of the specific questions——
Mr. Dalyell: Do the Secretary of State and the Minister accept in principle that there is an anomaly? That is all that I want to know this evening.
Mr. Ancram: The hon. Gentleman raised a number of questions and suggested that there were a number of anomalies. He referred especially to the HRA capital receipts and the effect of the assumptions of those on West Lothian. At present an authority's net allocation is arrived at after taking into consideration an estimate of its likely receipts. While that may appear to him to be an anomaly, it is something that COSLA said it would prefer when it was consulted about the introduction of a net allocation system. It would not be right to deal with each of the hon. Gentleman's points now, but I will deal with them in writing.
The right hon. Member for Western Isles (Mr. Stewart) asked questions relating to his local authority. I am familiar with the problems faced by the Western Isles in providing services to widely scattered communities. The assessment of relative expenditure needs which underlies current expenditure guidelines and the distribution of the needs element of rate support grant reflect in a number of ways the additional costs involved.
Over a long period Government grant has financed a large proportion—about 85 per cent.—of the council's expenditure, and that will continue. While the rate poundage is the highest in Scotland, the average domestic rate bill—which obviously reflects a very low rateable value—is little more than half the Scottish average. My
640
right hon. Friend will shortly make decisions about rate support grant distribution for 1985–86, and will take into account the points made on behalf of the council.
The hon. Member for Garscadden spoke of the differences between our penalty and the penalty in England. He should remember that the penalty in England can extend up to 200 per cent. of overspend. The system is very different and I am not sure that either he or the right hon. Member for Western Isles would welcome it if it was applied in Scotland.
My hon. Friend the Member for Stirling (Mr. Forsyth) made a powerful speech. He gave some sign, if any were needed, of some of the areas of waste within local government in Scotland. I hope that that will have opened the eyes of some of the councils which say that savings cannot be made and show them some ways in which they can make savings and avoid penalties.
My hon. Friend asked why we had not levied a penalty of £114 million, that being the total of the overspend. Obviously, that is a matter of judgment for my right hon. Friend. He will decide what is appropriate in the circumstances to achieve the reduction in expenditure for which we are looking. My right hon. Friend has made it clear that the penalties that he will levy next year will. be more severe than this year.
A number of my hon. Friends raised questions about rural areas and the effect of the guidelines on them. I know that it is easy—and I find this in my local authority—to look at the guidelines and say that they are good for everyone else but all wrong for us. I suspect that there is always an element of that when anyone looks at the guidelines as they affect his local authority.
Subject to further refinements of the system, I am satisfied that the particular needs of rural areas are recognised in the formula. For instance, such questions as sparsity and the effects on education of small village schools are taken into account when arriving at the assessment that is fed into the guidelines.
My hon. Friend the Member for Aberdeen, South (Mr. Malone) asked about statistical data in guidelines and grant distribution. That matter has been discussed and considered at some length, but it is difficult to run a system in which there is not a consistent set of statistics on which to operate across the board. It has been the view that the population statistics which are now the basis of the guidelines should be applied across the board so that some consistency and comparability between authorities can be achieved.
The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) referred to his own local authority and complained about the authority which he shares with my right hon. Friend the Secretary of State. He made a number of observations in relation to Kyle and Carrick. I confirm that the budget was above guideline to the extent: of £337,000. In contradiction to the line that he put forward, however, he will be interested to note that that council has decided to trim its budget by £238,500, thus reducing its grant penalty by £192,000. I hope, therefore, that he will accept that that council is setting an example that we hope that others will follow.
None of us likes general abatements. We like them no more than our predecessors in office who regarded them, reluctantly, as a necessary form of expenditure control. Our sadness is that last year's abatement did not achieve the message that we sought for this year's budgets. Authorities continued to budget at the same high levels and

641
the danger was becoming apparent that some authorities, somewhat cyncially and at the expense of their ratepayers, were prepared to rate up to meet the expected abatement. Considerable reductions amounting to £63 million have, however, been made. They must be welcomed and, as my right hon. Friend said, in some cases must be fully rewarded. I can only hope that the lessons of last year have now been learnt and that not only will next year's budgets be restrcited to guidelines but that local authorities will mitigate their penalties by reducing the current year's expenditure. It is worth remembering that if they did that they could achieve more rate support grant next year than this year under penalty as well as receiving back some of the penalty paid this year, thus doing their ratepayers a great favour.
We have heard much today about confrontation. I should make it clear that we have never sought confrontation. In the past we have often been accused of imposing limits and setting guidelines at such a late date that local authorities cannot meet them. This year we have gone out of our way, and intend to continue so to do, to give the earliest possible indications of the guidelines for next year. We have accepted that this is necessary for responsible councils to prepare to meet them. We have also been accused of giving no due warning of the implications of the guidelines and thus of somehow unfairly catching authorities by surprise when penalties are imposed. Again this year my right hon. Friend has made clear that excess over guidelines will be more severly penalised next year than this.
We have laid our hands on the table precisely to avoid confrontation. We have made the position clear in good time for authorities to make their dispositions to conform to them. There can be no accusations of surprise or of ambush. As my hon. Friend the Member for Fife, North-East said, local authorities know the score now. They know that in our guidelines we have come half way to meet their pleas. They know that they have no excuses for penalising the ratepayers by ignoring this information or disrupting services by deliberately opposing them. If next spring there is confrontation, it will not be of our making. If next spring there are penalties, they will have been incurred with the deliberate foreknowledge and decision of the councils that suffer them. If services are disrupted it will be because political councillors have deliberately willed that it should be so; and if ratepayers suffer it will be because that is a deliberate act of policy on the part of their councils.
What we are asking of councils is little more than our Labour predecessors asked in 1978. It is no massacre of services, no vast deprivation. We have moved towards them and we are now asking them to move towards us. I believe that we can achieve a situation in which local government accepts the hands of help that we are offering and in which we can get expenditure down to a level on which we can go forward with some stability. The order is a harsh necessity on that road. The Opposition will do the people of Scotland no favours by opposing it, and they will damage their own credibility. In our relations with local government, the Conservatives are looking for a better way. We are on the road, and we will not be diverted by the political shibboleths of Labour Members. I ask the House to support the order.
Question put:—
The House divided:Ayes 272, Noes 166.

Division No. 469]

[10 pm

AYES

Aitken, Jonathan

Grylls, Michael

Amess, David

Gummer, John Selwyn

Ancram, Michael

Hamilton, Hon A. (Epsom)

Arnold, Tom

Hamilton, Neil (Tatton)

Ashby, David

Hampson, Dr Keith

Aspinwall, Jack

Hanley, Jeremy

Atkins, Robert (South Ribble)

Hannam, John

Baker, Nicholas (N Dorset)

Hargreaves, Kenneth

Banks, Robert (Harrogate)

Harris, David

Batiste, Spencer

Haselhurst, Alan

Beaumont-Dark, Anthony

Hawkins, C. (High Peak)

Bennett, Sir Frederic (T'bay)

Hawkins, Sir Paul (SW N'folk)

Bevan, David Gilroy

Hawksley, Warren

Biffen, Rt Hon John

Hayes, J.

Body, Richard

Hayhoe, Barney

Boscawen, Hon Robert

Hayward, Robert

Bottomley, Peter

Heathcoat-Amory, David

Bottomley, Mrs Virginia

Henderson, Barry

Braine, Sir Bernard

Hickmet, Richard

Brandon-Bravo, Martin

Higgins, Rt Hon Terence L.

Brooke, Hon Peter

Hill, James

Brown, M. (Brigg & Cl'thpes)

Hind, Kenneth

Buchanan-Smith, Rt Hon A.

Hirst, Michael

Buck, Sir Antony

Hogg, Hon Douglas (Gr'th'm)

Budgen, Nick

Holland, Sir Philip (Gedling)

Bulmer, Esmond

Holt, Richard

Burt, Alistair

Hooson, Tom

Butler, Hon Adam

Hordern, Peter

Carlisle, Kenneth (Lincoln)

Howard, Michael

Carlisle, Rt Hon M. (W'ton S)

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

Carttiss, Michael

Howarth, Gerald (Cannock)

Cash, William

Howell, Ralph (N Norfolk)

Chope, Christopher

Hubbard-Miles, Peter

Clarke, Rt Hon K. (Rushcliffe)

Hunt, David (Wirral)

Conway, Derek

Hunt, John (Ravensbourne)

Coombs, Simon

Hunter, Andrew

Cope, John

Jenkin, Rt Hon Patrick

Corrie, John

Jessel, Toby

Couchman, James

Jones, Gwilym (Cardiff N)

Cranborne, Viscount

Jones, Robert (W Herts)

Critchley, Julian

Jopling, Rt Hon Michael

Crouch, David

Kellett-Bowman, Mrs Elaine

Dorrell, Stephen

Kershaw, Sir Anthony

Douglas-Hamilton, Lord J.

Key, Robert

Durant, Tony

King, Roger (B'ham N'field)

Eggar, Tim

King, Rt Hon Tom

Emery, Sir Peter

Knight, Gregory (Derby N)

Fallon, Michael

Knight, Mrs Jill (Edgbaston)

Farr, Sir John

Knowles, Michael

Favell, Anthony

Knox, David

Finsberg, Sir Geoffrey

Lamont, Norman

Fletcher, Alexander

Latham, Michael

Fookes, Miss Janet

Lawler, Geoffrey

Forman, Nigel

Lawrence, Ivan

Forsyth, Michael (Stirling)

Lee, John (Pendle)

Forth, Eric

Leigh, Edward (Gainsbor'gh)

Fox, Marcus

Lennox-Boyd, Hon Mark

Franks, Cecil

Lewis, Sir Kenneth (Stamf'd)

Fraser, Peter (Angus East)

Lightbown, David

Freeman, Roger

Lilley, Peter

Fry, Peter

Lloyd, Ian (Havant)

Gale, Roger

Lloyd, Peter, (Fareham)

Gardiner, George (Reigate)

Lord, Michael

Gardner, Sir Edward (Fylde)

Luce, Richard

Garel-Jones, Tristan

Lyell, Nicholas

Gilmour, Rt Hon Sir Ian

McCrea, Rev William

Glyn, Dr Alan

McCrindle, Robert

Gow, Ian

McCurley, Mrs Anna

Gower, Sir Raymond

MacKay, Andrew (Berkshire)

Grant, Sir Anthony

Maclean, David John

Greenway, Harry

McQuarrie, Albert

Gregory, Conal

Madel, David

Griffiths, Peter (Portsm'th N)

Major, John

Grist, Ian

Malone, Gerald

Ground, Patrick

Maples, John

643

Marlow, Antony

Silvester, Fred

Mates, Michael

Sims, Roger

Mather, Carol

Smith, Sir Dudley (Warwick)

Maude, Hon Francis

Smith, Tim (Beaconsfield)

Mawhinney, Dr Brian

Soames, Hon Nicholas

Mellor, David

Speed, Keith

Merchant, Piers

Speller, Tony

Meyer, Sir Anthony

Spence, John

Miller, Hal (B'grove)

Spencer, Derek

Mills, Iain (Meriden)

Spicer, Jim (W Dorset)

Mills, Sir Peter (West Devon)

Spicer, Michael (S Worcs)

Miscampbell, Norman

Squire, Robin

Mitchell, David (NW Hants)

Stanbrook, Ivor

Monro, Sir Hector

Stanley, John

Montgomery, Fergus

Steen, Anthony

Moore, John

Stern, Michael

Morris, M. (N'hampton, S)

Stevens, Lewis (Nuneaton)

Morrison, Hon C. (Devizes)

Stevens, Martin (Fulham)

Moynihan, Hon C.

Stewart, Andrew (Sherwood)

Needham, Richard

Stewart, Ian (N Hertf'dshire)

Nelson, Anthony

Stokes, John

Neubert, Michael

Stradling Thomas, J.

Newton, Tony

Sumberg, David

Nicholls, Patrick

Tapsell, Peter

Norris, Steven

Taylor, John (Solihull)

Onslow, Cranley

Thomas, Rt Hon Peter

Oppenheim, Rt Hon Mrs S,

Thompson, Donald (Calder V)

Page, Sir John (Harrow W)

Thompson, Patrick (N'ich N)

Page, Richard (Herts SW)

Thorne, Neil (Ilford S)

Parris, Matthew

Thornton, Malcolm

Patten, Christopher (Bath)

Thurnham, Peter

Patten, John (Oxford)

Townsend, Cyril D. (B'heath)

Pattie, Geoffrey

Tracey, Richard

Pawsey, James

Twinn, Dr Ian

Pollock, Alexander

van Straubenzee, Sir W.

Porter, Barry

Vaughan, Sir Gerard

Powell, William (Corby)

Waddington, David

Powley, John

Waldegrave, Hon William

Price, Sir David

Walden, George

Prior, Rt Hon James

Walker, Bill (T'side N)

Proctor, K. Harvey

Wall, Sir Patrick

Raffan, Keith

Waller, Gary

Rathbone, Tim

Ward, John

Rees, Rt Hon Peter (Dover)

Wardle, C. (Bexhill)

Renton, Tim

Warren, Kenneth

Rhodes James, Robert

Watson, John

Ridley, Rt Hon Nicholas

Watts, John

Ridsdale, Sir Julian

Wells, Bowen (Hertford)

Rifkind, Malcolm

Wells, Sir John (Maidstone)

Rippon, Rt Hon Geoffrey

Wheeler, John

Roberts, Wyn (Conwy)

Whitney, Raymond

Robinson, Mark (N'port W)

Wilkinson, John

Rossi, Sir Hugh

Winterton, Mrs Ann

Rost, Peter

Winterton, Nicholas

Rumbold, Mrs Angela

Wolfson, Mark

Ryder, Richard

Wood, Timothy

Sackville, Hon Thomas

Yeo, Tim

St. John-Stevas, Rt Hon N.

Young, Sir George (Acton)

Scott, Nicholas

Younger, Rt Hon George

Shaw, Giles (Pudsey)

Shelton, William (Streatham)

Tellers for the Ayes:

Shepherd, Colin (Hereford)

Mr. Ian Lang and Mr. Tim Sainsbury.

Shepherd, Richard (Aldridge)

NOES

Adams, Allen (Paisley N)

Bidwell, Sydney

Anderson, Donald

Blair, Anthony

Archer, Rt Hon Peter

Boyes, Roland

Ashton, Joe

Bray, Dr Jeremy

Atkinson, N. (Tottenham)

Brown, Gordon (D'f'mline E)

Bagier, Gordon A. T.

Brown, Hugh D. (Provan)

Banks, Tony (Newham NW)

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

Barnett, Guy

Brown, Ron (E'burgh, Leith)

Barron, Kevin

Bruce, Malcolm

Beckett, Mrs Margaret

Buchan, Norman

Beith, A. J.

Caborn, Richard

Bell, Stuart

Callaghan, Jim (Heyw'd & M)

Benn, Tony

Campbell, Ian

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

Campbell-Savours, Dale

644

Canavan, Dennis

Loyden, Edward

Carlile, Alexander (Montg'y)

McCartney, Hugh

Carter-Jones, Lewis

McDonald, Dr Oonagh

Clark, Dr David (S Shields)

McGuire, Michael

Clarke, Thomas

McKay, Allen (Penistone)

Clay, Robert

McKelvey, William

Clwyd, Mrs Ann

Mackenzie, Rt Hon Gregor

Cocks, Rt Hon M. (Bristol S.)

McNamara, Kevin

Cohen, Harry

McTaggart, Robert

Coleman, Donald

McWilliam, John

Concannon, Rt Hon J. D.

Madden, Max

Conlan, Bernard

Marek, Dr John

Cook, Frank (Stockton North)

Martin, Michael

Cook, Robin F. (Livingston)

Mason, Rt Hon Roy

Corbett, Robin

Maxton, John

Cowans, Harry

Maynard, Miss Joan

Cox, Thomas (Tooting)

Michie, William

Craigen, J. M.

Mikardo, Ian

Crowther, Stan

Millan, Rt Hon Bruce

Cunliffe, Lawrence

Miller, Dr M. S. (E Kilbride)

Cunningham, Dr John

Mitchell, Austin (G't Grimsby)

Dalyell, Tam

Morris, Rt Hon J. (Aberavon)

Davies, Rt Hon Denzil (L'lli)

Oakes, Rt Hon Gordon

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

O'Brien, William

Deakins, Eric

O'Neill, Martin

Dewar, Donald

Orme, Rt Hon Stanley

Dobson, Frank

Park, George

Dormand, Jack

Patchett, Terry

Douglas, Dick

Pavitt, Laurie

Dubs, Alfred

Pendry, Tom

Duffy, A. E. P.

Penhaligon, David

Dunwoody, Hon Mrs G.

Pike, Peter

Eadie, Alex

Powell, Raymond (Ogmore)

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

Radice, Giles

Ellis, Raymond

Randall, Stuart

Evans, John (St. Helens N)

Redmond, M.

Ewing, Harry

Richardson, Ms Jo

Fatchett, Derek

Roberts, Allan (Bootle)

Faulds, Andrew

Roberts, Ernest (Hackney N)

Field, Frank (Birkenhead)

Robertson, George

Fields, T. (L'pool Broad Gn)

Robinson, G. (Coventry NW)

Fisher, Mark

Rogers, Allan

Foot, Rt Hon Michael

Rooker, J. W.

Foster, Derek

Rowlands, Ted

Foulkes, George

Sheerman, Barry

Fraser, J. (Norwood)

Shore, Rt Hon Peter

Garrett, W. E.

Short, Ms Clare (Ladywood)

George, Bruce

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

Godman, Dr Norman

Silkin, Rt Hon J.

Golding, John

Skinner, Dennis

Gourlay, Harry

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

Hamilton, W. W. (Central Fife)

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

Harrison, Rt Hon Walter

Soley, Clive

Healey, Rt Hon Denis

Spearing, Nigel

Heffer, Eric S.

Stewart, Rt Hon D. (W Isles)

Hogg, N. (C'nauld & Kilsyth)

Stott, Roger

Holland, Stuart (Vauxhall)

Strang, Gavin

Home Robertson, John

Straw, Jack

Howell, Rt Hon D. (S'heath)

Thompson, J. (Wansbeck)

Howells, Geraint

Thorne, Stan (Preston)

Hoyle, Douglas

Tinn, James

Hughes, Robert (Aberdeen N)

Torney, Tom

Hughes, Roy (Newport East)

Wallace, James

Janner, Hon Greville

Wareing, Robert

John, Brynmor

Weetch, Ken

Johnston, Russell

Welsh, Michael

Jones, Barry (Alyn & Deeside)

White, James

Kaufman, Rt Hon Gerald

Williams, Rt Hon A.

Kennedy, Charles

Wilson, Gordon

Kirkwood, Archy

Winnick, David

Lambie, David

Woodall, Alec

Leadbitter, Ted

Young, David (Bolton SE)

Lewis, Ron (Carlisle)

Lewis, Terence (Worsley)

Tellers for the Noes:

Litherland, Robert

Mr. James Hamilton and Mr. Frank Haynes.

Lofthouse, Geoffrey

Question accordingly agreed to.
Resolved,
That the Rate Support Grant (Scotland) (No. 2) Order 1984, dated 18th July 1984, a copy of which was laid before this House on 23rd July, be approved.

Fire Services (Northern Ireland)
10.14 pm
The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Chris Patten): I beg to move,
That the draft Fire Services (Northern Ireland) Order 1984, which was laid before this House on 17th July, be approved.
The order has two purposes: first, to consolidate with amendments existing provisions relating to the composition and functions of the fire authority for Northern Ireland; and, secondly, to make further provision to strengthen the law relating to fire precautions in Northern Ireland to bring it into line with Great Britain.
Part II of the order reproduces those elements of existing legislation dealing with the constitution, powers, duties, administration and finance of the fire authority, but with some important amendments. No change is proposed in the present composition of the authority. There is a mixture of members drawn in the first place from the district councils, reflecting the local government involvement in the pre-1973 provision of fire services and, secondly, from a wide range of other interests.
In its consideration of the proposal, the Northern Ireland Assembly recommended that the authority should be composed entirely of nominees from district councils. However, I have decided that the existing arrangement has stood the test of time. It provides for membership of the authority to be drawn from a wide range of interests and experience, as befits a body providing an important Province-wide service. However, I propose that in future the chairman and vice-chairman will be appointed by the Department rather than being elected annually by the members. That is not an implicit criticism of the present or previous holders of those posts; each has given excellent service to the authority. Nevertheless, I believe that on balance it is now appropriate for the authority to be brought into line with other bodies administering Province-wide public services, such as the Housing Executive, the police authority and the electricity service.
I should add that it would not be my intention to exercise that power of appointment during the current term of the authority, which expires next September. The order also provides for the chairman and vice-chairman to be paid salaries commensurate with their enhanced responsibilities and duties.
The second major change relates to the functions of the chief fire officer, who, under existing legislation, is responsible to the authority for the efficiency of the fire brigade while the secretary reports direct to the authority on administrative matters. I now propose that, as in Great Britain, the chief fire officer should be the chief executive and answer to the authority for brigade and administrative matters. I have noted the Assembly's support for this proposal and article 9 has been re-drafted so as, I hope, to clarify the matter.
Part III deals with the important topic of fire precautions and will bring this aspect of the law in Northern Ireland into line with the corresponding Great Britain legislation. In essence, it establishes a system under which the occupiers of premises used for purposes designated under article 22 will be required to obtain from the authority a "fire certificate". This will be issued only when the authority is satisfied that the premises are provided with efficient means of escape, an adequate alarm system, fire fighting equipment and other fire

647
precautions. Article 22 is so drafted as to enable a wide range of premises to be designated—hotels, boarding houses, residential care institutions, work places and places to which the public resort in large numbers. Many of those premises are, of course, already required to be provided with means of escape and other fire precautions under existing legislation.
The new designation system will ensure greater flexibility in the introduction of fire precautions as the need for such control arises from the way in which premises are used. The remaining articles in Part III deal with the practical operation of the fire certification procedure providing for such matters as offences and penalties. They are being brought into line with those applying in Great Britain.
The fire tragedy at Maysfield leisure centre earlier this year underlines the importance of fire precautions. The order will place on the authority considerably increased fire precautions responsibilities and so, as I said at the time that the report on the Maysfield fire was published, finance is being made available to the authority to enable it to create a further 10 posts in its fire precautions department.
Part IV of the order restates the functions of the department as they relate to the power to appoint inspectors to report on the performance of the authority. For some time, the inspector appointed has been from the Home Office fire inspectorate, and it is my intention that we should continue to make use of the experience of that inspectorate.
This draft order should enhance our ability to prevent fires and to deal with those which tragically occur. I am sure that the House would wish to take this opportunity to commend the admirable work done by the fire service in Northern Ireland. The draft order should help the service to do an even better job in the future, and I have no hesitation in commending it to the House.
10.21 pm
Mr. Clive Soley: This is an appropriate time to place on record our gratitude to the men and women of the Northern Ireland fire service. It is one of the busiest in the world. It answered 18,600 calls in 1983, 55 people died and 786 were seriously injured. More than 130 firemen were injured.
Since 1969, at least one fire officer has been shot dead, four others have died undertaking their duties and scores have suffered multiple burns as a result of their occupation. Again, this is an appropriate time to bear in mind that throughout that period Northern Ireland's fire officers have not been on what we would describe as high pay. Indeed, the present figure for firefighters is around £100 a week net—less for part-timers.
There are 1,428 firemen in Northern Ireland, 579 of whom are full-time, working 42 hours a week in nine-hour shifts. The demands placed on them are often heavy and severe. It is interesting to note that there are no women firefighters in Northern Ireland, although there are five in the British firefighting service. Although I know that there is resistance to it in the Northern Ireland fire service, at some time it will be worth looking at the possibility of employing women in that area.
Part II of the order restates the constitution, duties and powers of the fire authority. Part III extends and consolidates the fire authority's powers by enabling the department to designate certain types of premises as
648
requiring a fire certificate, and imposes standard requirements in relation to fire alarms, firefighting and so on.
I was interested to note that the Northern Ireland Assembly approved the order but wanted more accountability. I accept that nothing more can be done about that at this stage, but the Assembly also drew attention to pensions for part-timers. We would welcome a ministerial response to that.
The Assembly also wanted to include places of worship as places needing fire certificates. The Minister might be tempted down that road after the experiences at York Minster, and at some stage that might be worth looking at. [Interruption.] the Bishop of Durham crossed my mind, but I am not thinking of asking him to serve there or to tighten up the argument for fire certificates in places of worship.
According to the Assembly, there is a need to tighten up certain other provisions and to check on the use of specified materials. These issues also deserve a more detailed response than we have so far had from the Minister.
My comments relate primarily to the Fair Employment Agency's report which was published earlier this year. I know that the Minister is aware of that report, and the Northern Ireland fire service is anxious that he should respond to it. That investigation discovered that in preceding years the number of Roman Catholics serving in the fire service were substantially below the number expected, given the proportion of applicants. In 1983, 33 per cent. of the applicants were Roman Catholic, but only 12 per cent. of the successful applicants were Roman Catholics. That is quite a discrepancy. That is on the basic grade. Above that grade, the representation of Roman Catholics is even less than it should be by any criteria of fair employment practices.
The Protestant success rate in reaching the interview stage is double that of the Roman Catholic rate, and the success rate of appointment of Protestants is three and a half times greater than it is for Roman Catholics. When that was brought to the attention of the fire service it went into the matter and began to look at ways to tackle the problem. It has looked at methods of interviewing and ways of training interviewers. It has looked at the possibility of identifying people by reference numbers rather than by name, as names are used as a basis for discrimination. I could offer the Minister the services of the Greater London council, which his right hon. Friend the Secretary of State for the Environment is anxious to get rid of. It has performed a useful operation in making sure that there are fair employment practices in the GLC firefighting service. There is plenty of experience to be drawn from around the country.
This is an important matter. I know that the Government accept that the Fair Employment Agency report is a fair one, and one with positive guidelines. I know, as well, that the firefighting service in Northern Ireland is anxious to conform with the aims of the Fair Employment Agency. What steps does the Minister think are being taken? Does he think that they are adequate to improve the employment prospects of Roman Catholics in the firefighting service of Northern Ireland?
10.26 pm
Mr. Clifford Forsythe: Before I speak about the order, I put on record my party's

649
admiration for the tremendous work and the courage of the fire service in Northern Ireland. It fully lives up to the standard of the other services and give a tremendous service to Northern Ireland in the tragic times through which we are living. Because of our praise for the brave and dedicated men who fight fires in Northern Ireland, we should look closely at the order, which will affect their everyday lives and the running of that service.
Only recently, in the tragedy that happened at Brighton, we saw, in the graphic photographs on television, the excellent work that the fire service men do. We give our greatest praise to that work.
Although this order may not be the proper occasion for raising this matter, we should consider the retained firemen's superannuation. They deserve to have the matter looked at by the Minister.
It is rather unfortunate that, when speaking about the order, the hon. Member for Hammersmith (Mr. Soley) did what our party is always accused of doing—introduce sectarianism into a Northern Ireland order. I am disappointed about that.
We should make great efforts to back up the hard work and bravery of the fire service men in Northern Ireland. The idea of the order is to bring Northern Ireland into line with what happens in the rest of the United Kingdom, but a few points need to be made about where the Northern Ireland service differs from the one in the rest of the United Kingdom.
One would have expected that the experts in this operation—the Fire Brigades Union—would have been consulted on matters such as this. Unfortunately, the union did not even receive a copy of the order from the Department. The excuse that was given was that the copy had gone astray in the post. That is something rather unfortunate in this day and age.
When the union received notification from the Northern Ireland Assembly's Environment Committee that it could, if it wished, make a submission to that Committee, it had to buy a copy of the order to study it. The net result was that there was not time to study the whole order before evidence was given to the Committee. The union has only recently been able to study the order in detail.
The Minister went out of his way to meet me and members of the union and we had an excellent hearing. But after the officials of the Department had had further discussions with the union, only minimal changes were made to the order.
Throughout the order there are references to the Department of the Environment and to the head of the Department. Article 2, dealing with interpretation, says that
"'the Department' means the Department of the Environment".
Article 50 says, under the heading "Inspectors", that
"The Department may appoint an inspector or inspectors".
Schedule 1, part I, says that
"a Chairman, a Vice-Chairman, and fifteen other members"
will be
"appointed by the Head of the Department".
Will the Minister tell me whether it means "the Department" or the Minister in charge of the Department?
650
Or does it mean the Secretary of State for Northern Ireland, who is in overall charge of all the operations in Northern Ireland?
It also says in schedule 1 that the Minister is to nominate the chairman and the vice-chairman of the Fire Authority for Northern Ireland. I know that there are great reservations about that on the part of the elected representatives of the authority. It is most unfair to change the system, because the authority was able to elect its own chairman and vice-chairman. It could have been an elected member or a nominated member, whichever was thought best. Regardless of what is done in other bodies, it is seen as a step backwards in regard to democracy—or at least the democracy that exists at the moment in Northern Ireland.
Schedule 1 also refers to the quorum that is required within the authority. It says that there should be eight members present out of the 17. It does not say that there should be a percentage of elected members present, or a percentage of nominated members. As the quorum is eight, it would be possible to end up with eight nominated members running the authority at any particular meeting, simply because for some reason or other there were no elected representatives present. I hope that the Minister will think about that.
Article 5(f) says that the Department will act in accordance with
"section 12 of the Northern Ireland Constitution Act 1973".
Section 12 refers to relations with the Republic of Ireland and says that
"A Northern Ireland executive authority may—
(a) consult in any matter with any authority of the Republic of Ireland".
I would assume — rightly, I hope — that that simply means that if any emergency arises in which one country is able to assist another where firefighting equipment is required, that will be done. I see the Minister nodding his head, and I am pleased that that is so.
Article 6 deals with the hydrants that are required throughout the Province, to be used by the firemen. It is proposed that no longer will the brigade be responsible for looking after the hydrants, painting them the right colours so that people know where they are, finding out where they are and making sure that everything is Al in case there is a fire. It is difficult to understand why that responsibility should be transferred to the Department of the Environment water service, away from the experts. It is the experts who are carrying out the job, and doing it well.
Will resources have to be made available to the Department of the Environment water service because of the change? Will it mean that that part of the fire authority's operation will have to close down? Will it not occasionally bring into conflict the financial restraints within the Department and the services that are required for the safety of the public? I have always found that creating extra facilities in any Department required extra money. I assume that allowances will be made, and that almost a new Department will be created to do the job. It seems silly that we should take it from the experts, who know where the hydrants are, and give it to the Department of the Environment water service, for which I have the greatest admiration, having been in that business. However, on occasions I have also found some

651
shortcomings that all seemed to be connected with finance. I would be worried that the financial aspect would raise its ugly head now and again.
Mr. William Ross: With regard to the provision of water hydrants, there have been occasions when the worst offenders in covering up water hydrants so that they could not be found were the Department of the Environment road service. Because of that, would it not be a good idea to make sure that the responsibility stayed with the fire service, as at present? It has an inspection service that goes round and clears out the fire hydrants periodically, and tries to ensure that they are kept in proper working order, which is very important. We should keep the job in the hands of the fire service, which, being a separate area of government from the Department of the Environment, might be freer in its criticism when a hydrant is tarmacked in by the Department's road service or its contractors.
Mr. Forsythe: I thank my hon. Friend for his comments, with which I totally agree, having had the experience of trying to repair a burst pipe, perhaps in the early hours of the morning around Christmas time, only to discover that the stop cock box had disappeared under about 3 in to 4 in of tarmac.
Article 27, under part III of the order deals with fire precautions. While I welcome the major step forward in the fire precaution legislation in Northern Ireland, I am concerned that it is included in the new order. Surely it should have been separation legislate, as in the rest of the United Kingdom. I have compared like with like between the new Northern Ireland fire precautions legislation and that of Great Britain and have found a number of omissions and differences to which I want to draw the Minister's attention. Article 27 is identical to the legislation for England with one exception. Subparagraph (f) of the English legislation has been omitted from that for Northern Ireland. It says:
"in case of factory premises, particulars of any explosive or highly flammable materials which may be stored or used in the premises."
I am assured that that subparagraph is important to the contents of a fire certificate and is not covered by any other legislation such as that on explosives. Why has that subparagraph been left out of article 27? Can the Minister assure us that the omission of this part of the tried and tested English fire precautions legislation from the Northern Ireland order will in no way be detrimental to the comparable standards that should apply in Northern Ireland?
Article 51 appears to give the Department absolute power over the experts in the authority and the fire service. Even in article 5, with its reference to section 12 of the Northern Ireland Constitution Act 1973, which I have already mentioned, and apparently even where the authority and the chief officer were in agreement that something should be done or should take place, the Department can overrule both the authority and the chief officer. I would take a little bit more kindly to that if it were the Minister who had that authority because he is an elected Member of the legislature and as such we can at least put a little pressure on him. But I cannot say the same for the Department. Therefore, with all due respect to our
652
friends in the higher reaches of the Civil Service, we cannot say that they would be experts on fire services. We could find that the experts are being overruled by cavil servants. Moreover, civil servants are generally ruled by financial considerations rather than practical or safety considerations, which should be taken into account.
Article 50 retains the provision for appointing an inspector, which was previously in article 29 of the principal 1969 order. But no mention is made of the special practical experience required by the 1969 order. For example, experience of the extinction of fires is required. While the provision of appointment has never been taken up since 1969, at least requests have been made for Home Office inspections. If the Minister can confirm that it is his intention that Her Majesty's inspectorate will continue to be used for that function in Northern Ireland I shall be very pleased. If appointments are to be made under article 50 will the Minister tell us what specialist knowledge and experience will be required of such an appointee?
Schedule 5 repeals article 6 of the Fire Services (Northern Ireland) Order 1973, including its reference to added paragraph (b) from section 16 of the principal Act of 1969. That protected the standards and conditions of uniformed personnel. Those standards were derived from the national joint council for the local authority brigades, and were protected by article 6 of the 1973 order.
I am sure that the Minister would not wish to treat Northern Ireland's firemen any less favourably than their counterparts in the rest of the United Kingdom. Will he therefore assure me that under the order, the authority, the Department and the brigade will continue to accept the standards, conditions and recommendations of the national joint council and the authority's membership of the same, even though I know that the national joint council legislation does not apply to Northern Ireland?
In section 32 and schedule 4 of the Fire Services Act (Northern Ireland) 1969, there was provision for a Northern Ireland fire service advisory council, similar to the Central Fire Brigades Advisory Council in Great Britain. This has now been changed, leaving Northern Ireland in the unique position of having no advisory body for standards of appliances, equipment and procedures.
I accept that the advisory council was never appointed, but it must be stressed that that was simply because the principal bodies concerned accepted that most of the council's work would be similar to that carried out by the Central Fire Brigades Advisory Council, and that it was more expedient to accept that body's recommendations. Will the Minister confirm that in the absence of a Northern Ireland advisory council, the Department, the authority and the brigade will continue to accept and maintain the recommendations and standards of the Central Fire Brigades Advisory Council?
Under article 8, the fire authority will be recognised as a district council, with sections 23 to 27, 31, 40, 123 and 126 of the Local Government (Northern Ireland) Act 1972 applying. One would have thought that that was fine, but we find that there are two glaring omissions from those public referral sections: sections 121 and 122. They refer to the minutes and notices of meetings. It seems strange that if one knew where the meeting was, one could go

653
along to a fire authority meeting and have the right to sit in on it. However, one would not be entitled to see the minutes or to be told where the meeting was. That seems illogical. In the House, every word is recorded, and anyone can read it. One would have thought that the least that the Northern Ireland Fire Authority could do would be to allow the minutes to be looked at and to let people know the time and place of the meeting. The Minister may
654
be sympathetic towards doing something about that, and I urge him to take a serious look at it in the near future. I hope that he will come to the correct conclusion.
I am concerned that the order seems to give less power to Northern Ireland's elected representatives and more to the Department. I hope to receive a favourable response from the Minister to the points that I have raised, but I also hope that the order's operation will not in any way lower the standards of firefighting and fire precautions in Northern Ireland.

Fire Services (Northern Ireland)
10.50 pm
Rev. William McCrea: I thank you, Mr. Deputy Speaker, for giving me the opportunity of taking part in the debate on the order, which has been subjected to in-depth scrutiny by the Northern Ireland Assembly's Environment Committee. The Secretary of State has accepted many of the Committee's recommendations. On 19 June, the Committee responded to a letter from the Secretary of State. I trust that even further changes will be made.
Many hon. Members decry the Northern Ireland Assembly, its usefulness and the work of its elected representatives. Yet, if I had closed my eyes tonight when the hon. Member for Hammersmith (Mr. Soley) spoke, I could have been excused for thinking that he had carefully scrutinised the Committee's recommendations and that its report formed the basis of his argument—except in one instance.
We have the answer to the critics of the work of the Assembly and its Environment Committee in this debate because much has already been done to provide a better order. The Secretary of State accepts many of the Committee's recommendations.
The Minister said tonight that the chairman and vice-chairman of the authority would in future be appointed by the Department. He was keen to point out that, although that was a great departure from what has happened in the past, it was not a slight on those who had occupied those posts in the past.
Curiously, that reminds me of what happened some years ago in Northern Ireland. The Government and the House praised the Ulster special constabulary for its excellent work and devotion in the Province—then the Government disbanded the force. After they praise the chairman and vice-chairman and their excellent work, they say that they will not entrust the authority with the privilege of electing its own chairman and vice-chairman. That verges on saying, "We cannot trust the authority to appoint its chairman or vice-chairman." That is a matter for deep regret.
The second part of the order also deals with relevant matters. Much of the fire brigade's work extends beyond the extinction of fires. In Northern Ireland the fire service could appropriately be called the fire and rescue service. Some recognition of that can be found in the order. The wording of the proposed legislation should reflect more clearly the distinctive role of the Northern Ireland fire service.
I agree with much of what the hon. Member for Antrim, South (Mr. Forsythe) said about fire hydrants. Many country areas do not have fire hydrants and hydrants in some areas do not work. Surely the order should be amended to require the Department to provide such facilities within 28 days of being notified of their absence. I have a large rural constituency and such a requirement would be of great assistance to us. If it is not included in the order, it will not be done.
The firemen's union has expressed great anxiety about the matter. Firemen encounter untold difficulties in locating fire hydrants in rural areas and they face the added difficulty of maintaining a water supply when they find a
656
hydrant. It is incumbent on the fire authority to ensure that an adequate and constant water supply is available and that fire hydrants are working satisfactorily.
When there was a fire in my locality, it took firemen about an hour to find the fire hydrant and it proved to be useless. The fire brigade had to travel several miles to get water to put out that fire.
The fire authority was set up after the reorganisation of local government in 1973. Control by public representatives was diluted. Unfortunately, the same thing happened in most other areas of public life—much to the detriment of Ulster people. Our Province needs more democracy and more democratic control by its elected representatives.
Certain premises, including churches and private single-occupancy dwellings, are to be exempted from fire regulations. The House will understand why I, as a minister of religion, agree that churches have rightly been exempted, given the low risk element in such premises. However, fires in private homes have been the greatest source of fire fatalities in the Province. In 1980, 29 of the 30 deaths in fires occurred in private homes.
The Northern Ireland Assembly has asked that buildings that are granted occasional entertainment licences and often carry an inherent risk should be covered by legislation. Under article 26, the authority is allowed considerable scope in determining the period within which an applicant for a fire certificate is required to do certain things. Surely that part of the legislation ought to be strengthened to give the authority power to require requested information to be made available within a given period.
Another matter that causes great anxiety is the omission of any expression of the level of safety achieved by compliance with the legislation. In addition, fire regulations do not take into consideration changes that may occur during the lifetime of a building and may affect the effectiveness of fire precautions legislation. It is felt that article 29 ought to be amended to include a schedule providing that inspections of different types of premises take place at specific intervals.
I do not wish to lengthen the debate or to rehash the debate in another place. I appreciate the measures that the Secretary of State has seen fit to take, which were the subject of his reply on 5 June, and the points of clarification that have been noted. It is accepted by all that fire precaution is an important aspect of the work of the fire service. Obviously, every fire prevented is one fire less with which to deal. Prevention is much less costly than cure.
It is welcome that the Department of the Environment has made provision in the next two financial years to enable the authority to increase its strength by up to 10 posts to meet the immediate demand arising from the fire precaution aspect of the proposed order. However, it is the desire of the people of Northern Ireland that the authority should be more representative of local opinion. The Government's view is that the amendment proposed by the Northern Ireland Assembly would endanger what the Secretary of State calls a general acceptance of the firefighting and fire precaution services within the community. My colleagues and I resent such a claim. Indeed, it is an insult to Ulster's elected representatives that the Secretary of State asserts that the people appointed by him would be more acceptable than those elected by the

657
people of Northern Ireland. I do not agree with his assertion, which is a sign of contempt for the democratic process.
I wish to place on record the sincere appreciation of hon. Members for the dedicated professional work of the Northern Ireland fire service during the last few years, especially bearing in mind the turmoil in the Province. No words of mine could explain how the people of Northern Ireland feel in their hearts about those who do such excellent work under current conditions. Their dedication to duty, their courage and their magnificant work is deeply appreciated.
However, a pat on the back is not sufficient. The Minister has said that he is waiting for the result of action that has already been taken. I ask him to respond to the request for a proper pension scheme that would cover retained firefighters, upon whose skill and courage the majority of the lives of the people of Ulster depend. A vast number of those who fight fires are retained firemen. Will the Minister reconsider the recommendations already rejected by his Department? I trust that he will ensure that our legislation is the best possible for the Province and in the best interests of the people of Northern Ireland.
The hon. Member for Hammersmith, as usual, made cries of discrimination. If he is not looking to Dublin when he speaks in the House, he has something to say about discrimination. I trust that I am not unparliamentary in saying that it was something of a cheek for him to mention the GLC. Anyone looking at the GLC and Red Ken would realise that the GLC is the last system in the world to hold up as an ideal local government.
Red Ken ensures that the red brigade are around him. If a Conservative, a Liberal or even a moderate Socialist applies for a job at the GLC, that person, to use a country expression from home, hasn't a pup's chance. The spokesman for Her Majesty's Opposition would do better to keep the charge of discrimination for his own party and look inside before pointing the finger across the Irish sea to the rest of the United Kingdom.
11.5 pm
Mr. J. Enoch Powell: No one who listened to the careful and well-informed speech of my hon. Friend the Member for Antrim, South (Mr. Forsythe) can be unaware of how unsatisfactory a method of making law is the procedure by Order in Council. As he made his successive points, one noted that the Minister was taking them on board and that there was a regular and vigorous traffic between the Minister and his well-qualified advisers. I am sure that the Minister's answers on all those points, so far as he can achieve it, will not be perfunctory. Yet one thing is certain in advance. Though we speak with the tongues of men and angels, not a jot or comma in the order will be changed. We have not the opportunity, clause by clause and subsection by subsection, Northern Ireland Assembly or no, to put the details of the legislation before our colleagues and before the Minister in circumstances in which he can be persuaded by our arguments or by his own later thoughts. No prior consultation can be any substitute for the proper processes of parliamentary legislation. I am afraid that we are having an object lesson in that tonight.
After the speech of my hon. Friend, I wish to refer only to two points of little more than a drafting nature and to
658
two others of a semi-constitutional character. Like the hon. Member for Mid-Ulster (Rev. William McCrea), however, I cannot help referring to the remarks which fell from the hon. Member for Hammersmith (Mr. Soley). The hon. Member for Hammersmith fell into the common fallacy of taking the composition of a body, recruitment to that body or promotion within that body, comparing it with the composition of the population at large, and concluding that if the two do not match, the discrepancy is due to deliberate and culpable discrimination. That is an arrant fallacy. There are a hundred reasons why, even in the matter of promotion, let alone in the matter of recruitment, there could be marked discrepancy. Until those factors have been examined with great care—I do not believe that the hon. Member for Hammersmith is in a position to gauge many of them — no conclusion whatever can validly be drawn as to the motives which have actuated those who conduct the appointment or promotion.
Mr. Soley: Once again, the right hon. Gentleman has got it wrong from the start. It does not follow that the discrimination is deliberate. I did not say that and nor would the Fair Employment Agency say it. Discrimination takes place at a number of different levels and sometimes it is deliberate. The point that the right hon. Gentleman must answer is this. Does he believe that discrimination has taken place in employment in Northern Ireland, and does he favour getting rid of the agency? Obviously his hon. Friend would like to get rid of it, as would the Democratic Unionist party. Where does the right hon. Gentleman stand?
Mr. Powell: I voted against the legislation under which the Fair Employment Agency was set up. I believe that it has been an unfair employment agency in its operation. It is an abomination, and I would like to see it off the statute book. The hon. Gentleman has his answer, although it is one that my hon. Friends and I have already put on the record in years past.
I was about to refer to one such factor which must be considered in judging the circumstances in Northern Ireland. That is the personal safety of people who volunteer to take part in certain public services. When one knows the pressures that can be brought to bear on individuals and their families in Northern Ireland, that is sufficient reason for treating with great scepticism any suggestion that discrepancies of proportionate employment place any stigma on anyone concerned, including the authority in question.
I shall now deal with the two points of detail that I want to raise with the Minster. I do not know whether the good and laudable custom still prevails of Ministers reading while they are still in draft the orders which they are eventually to lay before the House. I commend that practice to the Minister and other Ministers. It can lead to a wonderful improvement in the quality of what is laid before the House if it has been read before by the Minister concerned before it reaches too late a stage of drafting. When I read article 4(2)(a) and attempted to construe it, I was certain that no Minister could have read it and let it pass and that no Committee of the House would have left it unaltered in a Bill. It construes as follows:
"The Authority shall make the provision required … by securing—
(a) the services of the fire brigade to meet efficiently all normal requirements".

659
That simply does not mean what it says. It is a piece of sloppy, badly drafted English which does not convey the intention, namely, something parallel with subparagraph
(b) "the efficient training of members of the fire brigade"
and subparagraph (c) which begins:
"efficient arrangements".
Such drafting would simply not have passed muster if it had been examined properly earlier.
My second point relates to article 9 to which the Minister referred, although he did not quote the actual reference to article 9(2)(c). The wording there is said to result in the secretary of the authority reporting no longer to the authority but to the chief fire officer. The alteration that has produced this stupendous effect is to substitute for the words
"such administrative and other officers as may be necessary for the performance of the functions of the Authority"
the longer form
"such administrative and other officers as may be necessary to assist the chief fire officer in the performance of the functions of the Authority."
That may achieve the result that is claimed by the Minister; but the House would be obliged—and it might be convenient for the future—if he could give a more precise indication of how that result follows.
I now discuss the two larger points I have in mind. By regulations under article 48, any of the provisions of that part of the Act may be applied to
"vessels remaining moored or on dry land"
and so on and to
"tents and other movable structures".
When they are made, those will be important regulations. They will affect many people and many interests. Moreover, they will not be easy to draft in such a way as to be both sensible and effective. We therefore look to discover under what sanction those regulations will become law. We read in article 52 that
"all regulations made under this Order shall be subject to negative resolution."
I come here to a point that was made with seductive innocence by my hon. Friend the Member for Antrim, South—that these orders tell lies and are drafted as if the Northern Ireland (Interim Provisions) Act 1974 did not exist. To understand what will actually happen, hon. Members need to have beside them, while reading these orders, a copy of the schedule to the 1974 Act to use like a vocabulary: for A substitute B; for X substitute Y. When they have interpreted it with that aid, they will discover that "subject to negative resolution" means that there will be no procedure at all.
Now, anyone would admit that it is quite unsatisfactory that hon. Members and the representatives of the public in Northern Ireland, assembly or no assembly, should have no opportunity whatsoever to scrutinise, criticise or secure amendment in regulations in so important an area, which apply to provisions of the order.
I hope that the Minister will be able to concur with a suggestion I have to make. I trust we shall not long live under the absurd regime of a combination of legislation by Order in Council with the Northern Ireland (Interim Provisions) Act 1974. I believe that the day cannot long be delayed when the House will recognise that it must legislate for Northern Ireland in the same way as it legislates for the rest of the kingdom. But pending that day dawning, will the Minister, in the context of this order, give a specific undertaking in respect of the regulations and tell the House that when and if such regulations come forward they will be brought in draft form to the attention
660
first—having listened to my hon. Friend the Member for Antrim, South I must say this — of the union concerned, but also of hon. Members representing Northern Ireland and elsewhere on a wide and generous scale so that we can get as near as possible under this regime to a genuine opportunity for negative resolution. That seems a reasonable request to make of the Minister, and I hope that he can tell us that it will be accepted.
Finally, I refer to part IV of the order, which deals with the inspecting and, as it were, supervisory functions of the Secretary of State. When we apply the vocabulary of the Northern Ireland (Interim Provisions) Act 1974, we discover that what is called the "Department" is the Secretary of State. As my hon. Friend said, it is only proper that since the Secretary of State is the only person inside the authority or elsewhere who is directly responsible to the elected representatives of the people, that is how it must be.
The Secretary of State is empowered, and, by implication, required in duty, to assure himself through inspection and otherwise that the authority is fulfilling its duties under the legislation. If he is not satisfied, he must proceed either by direction or in default of his own responsibility. Therefore, the order ends by making the Secretary of State as responsible in the House, responsible in the last resort for the efficiency and the operation of the fire services in Northern Ireland. That is as it should be, and that is the only solution which could be put forward to the existence of a body which comprises only nominated persons, some nominated by the Secretary of State and others by various bodies such as the city of Belfast and the Association of Local Authorities of Northern Ireland.
It would be unconstitutional and unacceptable for so important a function to be carried out without direct public accountability. It is the position of the Secretary of State under part IV which creates that accountability. That should be clearly understood, although upon the face of the order a good deal of interpretation must be carried through before it appears.
11.19 pm
Mr. Chris Patten: I am grateful for the interest which several right hon. and hon. Members have shown in this important order. I was especially grateful for what the hon. Member for Hammersmith (Mr. Soley) said at the beginning of his remarks about the professionalism and bravery of the fire service in Northern Ireland — comments that were echoed by other hon. Members during our short though interesting debate.
The hon. Member for Hammersmith raised several points, and I shall deal with the three main ones. He mentioned the possibly enhanced role for women in the fire service in the Province, and I shall certainly draw the attention of the Fire Authority to his remarks. He referred, as did several other hon. Members, including the hon. Member for Antrim, South (Mr. Forsythe) in a characteristically well-informed speech, to pay and pensions. I should make the point, with the assistance of the traffic to which the right hon. Member for South Down (Mr. Powell) referred, that the pay and pensions of firemen in Northern Ireland are determined, as the House will know, through the mechanism of the National Joint Council for Local Authority Fire Brigades in Great Britain. In common with their counterparts in Great Britain, part-time firemen in Northern Ireland do not receive a pension from the Fire Authority. The House will

661
know that that principle is being challenged through the courts, and as the issue is clearly sub judice we must wait to see what happens.
The hon. Member for Hammersmith referred in rather more controversial terms to the Fair Employment Agency report, and what he had to say was the subject of an exchange between him and the right hon. Member for South Down. I must tell the hon. Gentleman that, whatever the discussion between himself and the right hon. Member for South Down about discrimination, the FEA report does not talk about discrimination in the fire service. It argued that equality of opportunity had not been achieved in the service. I am sure that the hon. Member for Hammersmith will be pleased to note the co-operation which the agency received from the authority at every stage in the preparation of its report, and he will be pleased by the ready acceptance by the authority of the agency's recommendation. I assure the hon. Gentleman that the authority, which is currently involved in a recruitment exercise for full-time firemen, is putting into operation in that exercise the recommendations made by the agency.
Mr. Soley: I said that I recognised that the fire service was going out of its way to co-operate, and I want that view to be firmly on the record. My concern is that support is not offered from the Unionist parties in the House towards that concept. It devalues everyone's worth if we do not pursue that at the level that it deserves and at the level at which the people in the Northern Ireland fire service are prepared to pursue it.
Mr. Patten: I am grateful for what the hon. Gentleman said, but I repeat that the recommendations of the FEA are being supported wholeheartedly and implemented by the the authority, which is the main consideration. I repeat that the authority includes several members who are directly elected representatives.
The hon. Member for Antrim, South, in his interesting and thoughtful speech, mentioned several points, with which I shall try to deal seriatim. First, he said that we have not adequately consulted members of the fire service in Northern Ireland, and I apologise for any lack of consultation. I am advised that a copy of the order was sent to the Northern Ireland secretary of the Fire Brigade Union, but unfortunately — perhaps fortunately in the broader sense—he had moved house shortly beforehand, and it took some time to get a copy of the original proposals to him. I unreservedly apologise for the fact that that mistake was made.
The hon. Gentleman also referred to the head of the Department. The answer was given with more eloquence, and conceivably more accuracy, than I shall now do by his right hon. Friend the Member for South Down. Under the provisions of the Northern Ireland Act 1974, the functions of the head of Department — previously a Stormont Minister—are carried out by the Department, in this case the Department of the Environment for Northern Ireland for which I have some responsibility, but subject to the direction and control of the Secretary of State. The right hon. Gentleman has made that point to me on other even more controversial occasions.
The hon. Member for Antrim, South also talked about the position of the chairman and vice-chairman. That point was also made by the hon. Member for Mid-Ulster (Rev. William McCrea), whose remarks reflected the comments
662
of the Assembly. I can only repeat what I said initially, that on balance we took the view that it was sensible to bring the authority — not least because of its considerable responsibilities and the considerable amount of public money for which it is responsible—into line with similar bodies in the Provinces, such as the Police Authority, the Housing Executive, the Water Council and the Electricity Service. I am sorry that both hon. Members do not care for that decision, and I again assure them that it is no reflection on the unstinting service of previous chairmen of the authority.
The hon. Member for Antrim, South referred to relations with the Republic. I assure him that we are not referring to anything more than the usual reciprocal assistance between brigades south of the border and the brigade in the Province. This is a particularly active feature of life in some parts of the Province. There needs to be these reciprocal arrangements and we are not referring to anything more than that.
As I am sure the hon. Gentleman is aware, explosives and their control is a reserved matter. Therefore, it is not possible to deal with them in this order. That issue is covered by another piece of explosives legislation.
I know that the inspectorate has concerned the Fire Brigades Union. There will be no change in the existing practice of using the Home Office fire inspectorate. Article 50 simply repeats, with a slight textual amendment, existing provisions. The Home Office inspectorate will continue to be used by us. I also assure the hon. Gentleman that the same standards and conditions of service will apply in Northern Ireland as apply on this side of the water.
The hon. Gentleman also referred to the minutes of the authority. This is a matter on which we have exchanged correspondence. As I told him in my letter of 18 October, I am considering this point and I shall write to him again as soon as possible.
The hon. Gentleman and his hon. Friends the Members for Mid-Ulster and for Londonderry, East (Mr. Ross) spoke of hydrants. I am obviously concerned with the anxieties of hon. Gentlemen, and I shall ensure that those problems are looked at closely and quickly. I can answer them to this extent. I know that the Fire Authority consults closely with the water service on the location of fire hydrants when new mains are being laid, and the authority operates its own hydrant patrols to check on the serviceability of hydrants. I shall bring the attention of the road service and its divisional management to the points made by the hon. Gentlemen.
The question of religious premises was raised not only by the hon. Member for Antrim, South but by the hon. Member for Mid-Ulster, and was touched on, with a delicate reference to the Bishop of Durham, by the hon. Member for Hammersmith. Premises used for public religious worship are exempt from the requirements of the fire certificate when they are used solely or mainly for public worship. If the fire authority considers that a church is being used substantially for other purposes, the fire authority can require a fire certificate to be applied for under article 23.
The hon. Member for Mid-Ulster also referred to the information that is made available to the Fire Authority. It can ask for information from an applicant for a fire certificate within whatever time it believes to be necessary, and this time will vary depending on the complexity of the information and on whether the

663
applicant may have to seek information from another source. For example, a tenant may have to seek information from his landlord.
The right hon. Member for South Down expressed reservations about legislation by order. I note what he says, although I suspect that he may need to make the point again, and I may need to note what he said again. He made a couple of detailed comments about the drafting of the order. He dealt with article 4(2)(a) in some detail, but it does not seem as bad to me as it does to him. However, I am notoriously bad about these things. I once wrote a book that I subsequently discovered had a lot of mistakes, and not only political ones.
More substantially, the right hon. Gentleman referred to articles 48 and 52. He said—this seemed wholly reasonable — that if we were to bring forward orders under article 52, we should consult widely with right hon. and hon. Gentlemen about them. I shall consider that proposal sympathetically, and I see no objection in principle to such consultation, in the event of such an order under article 52, for example, if it applied to vessels.
The right hon. Gentleman also referred to the accountability of the Secretary of State to the House for his supervisory functions under the order. I accept what the right hon. Gentleman said about that accountability.
I think that I have dealt with the majority of points raised by right hon. and hon. Gentlemen. If I have not, it will be brought to my attention through the usual traffic. I am grateful on behalf of the Fire Service for the quite proper regard that has been shown by right hon. and hon. Gentlemen for its record in Northern Ireland. It is a record that has properly earned it the admiration of its colleagues in other fire services throughout the United Kingdom, and beyond.
Question put and agreed to.
Resolved,
That the draft Fire Services (Northern Ireland) Order 1984, which was laid before this House on 17th July, be approved.

Fire Services (Northern Ireland)

  BUSINESS OF THE HOUSE
  Ordered,
  That, in respect of the Foster Children (Scotland) Bill [Lords], and the Building Bill [Lords], Notices of Amendments, new Clauses, and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the Bill has been read a second time.—[Mr. Lang.]

Young Offenders (Northern Ireland)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lang.]
11.35 pm
Mr. Ken Maginnis: The House will think it not a little strange that I should plead the case for some new initiatives that would lead to young offenders detained at the Secretary of State's pleasure being more quickly rehabilitated and systematically absorbed back into the community. I know that I have consistently pressed for sterner sentences for hardened and mature terrorists. I admit that I continue to advocate that those who show no evidence of remorse or dissociation from paramilitary involvement while serving sentences for terrorism should remain in custody at the completion of their sentence. Yet I do not believe that this stance will be inconsistent with my argument on behalf of a young offender who is detained at the Secretary of State's pleasure.
Let me set the scene for the House. The early 1970s saw increasing terrorist activity and a rise in the murder rate. It was the prorogation of the Stormont Parliament in 1972 and the sudden and unexpected removal of that forum for democratically elected politicians which saw the inevitable increase in the influence of the godfathers of violence, who so quickly filled the void that was created. In every street within every village there arose self-appointed groups with self-appointed leaders who preyed on the young and vulnerable and sent those impressionable boys out with guns to do their dirty work. It is with those boys, who were under 18 years of age, that I wish to concern the House.
There were three convictions — of three youth offenders—in 1974; the number rose to 16 in 1975. There were 12 in 1976 and 17 in 1977. Boys from both sides of the community who were convicted during those years have now served between seven and 10 years' imprisonment, the equivalent of 14 to 20 years for an adult, who will receive automatically 50 per cent. remission. We have two standards of justice. There is an indeterminate sentence for children and a determinate sentence for adults. I note that the Under-Secretary of State shakes his head, and before he rises to say that life sentence for murder is also indeterminate, let me say that I accept that. However, it is not unusual for those involved in terrorist killings who are not proven prime movers in the crime, or who are involved without pulling the trigger, to be given determinate sentences. That cannot be the case with the Secretary of State's prisoners.
If an adult plans a murder, another adult provides the weapon, two adults carry out the killing, a boy acts as lookout and they are all caught, it is most likely that the planner will remain silent, plead not guilty and walk away free. The planner is always the hardest to convict. The quartermaster will be charged with possession and will be sentenced to eight years' imprisonment, which means that he will be free in about four years. Of the two killers, the one who pulled the trigger will get life and his adult companion, no doubt claiming that he did not realise that a killing was to take place or that he was under duress, will perhaps receive a 12 or 14-year sentence and will be out in six or seven years. The boy who acted as lookout, as an SOSP, will be likely to serve an indefinite custodial sentence as the law stands.

665
That is one case that I know about. Let me recount another case which was highlighted recently on the Ulster television programme "Counterpoint", which vividly portrays the tragedy of children in the mid-1970s.
Billy McCurrie was 12 years old when his father was killed by an IRA sniper. Heartbreak had provided a new recruit for the godfathers, and Billy joined the UVF where, at the age of 16, he was ordered, with another man, to kill a member of the IRA. In February 1976 the victim, who had been pointed out to Billy by an older man, died in a hail of bullets. But the victim was not an IRA man; he was a Protestant whom the UVF godfathers had decided to eliminate for their own selfish and evil purposes. Poor, tragic, misguided Billy had been exploited and now serves an indeterminate sentence.
There are about 60 young Billy McCurries in Ulster's prisons today. The Minister does not need to tell us in his reply that their crimes were horrid and brutal. I have spoken to some of these boys, now young men between 24 and 28 years of age. How they wish that they could begin all over again with the added wisdom that the last seven to 10 years have brought. How many revile themselves for their naivety and folly. Full of remorse, they languish without hope in prison, while the unrepentant adults who led them into violence walk our streets seeking further victims. Our inadequate, impotent law can do nothing about it. Where is justice to be found?
On 24 May this year I asked the Minister if he would
"re-examine the review procedure for those young people and make a special case on their behalf."
I gave him my assurance that I meant all SOSPs. He disappointed me by answering:
"I am satisfied that we have the right machinery for keeping such cases under review. Youth at the time of the crime is one of the factors that I take into account when advising my right hon. Friend about release dates."—[Official Report, 24 May 1984; Vol. 60, c. 1232.]
But is not that review procedure a mere 10 or 15 minutes in the governor's office when the governor has time? Do not most of the young men decline to comply with the ritual because they believe it is a meaningless mockery of their hopelessness?
Has not the Secretary of State in the past written to despairing parents — parents who often share their children's guilt and feel that the latter's crime is their own failure—and has he not blamed the compound system for the inadequate review procedure, stating, in a letter to a parent:
"That is not to say, of course, that the retention of special category status by itself counts against any prisoner when his case is being reviewed, but at the same time it must be accepted that it is virtually impossible to obtain meaningful reports on prisoners in these compounds because they are for the most part outside the day-to-day contact, discipline and observation found in the normal prison set-up."?
It was not the young prisoners who created the special category system and the compounds. It was the Government, and it is up to the Government to find a way to deal with the problems created by a decision which Government made in days gone by.
Am I not right to believe that these young men have made an effort to educate themselves, and that educationists regularly enter the compounds to assist them with their studies? We all know that there is supervision in many forms. How can the Northern Ireland Office
666
appear to dismiss these victims—yes, victims—of their own and society's creation in such a thoughtless and callous manner?
Mr. Roy Beggs: Does my hon. Friend agree that there is considerable scepticism by the parents of young offenders to whom letters are sent by the Minister or the Secretary of State? Those letters often reflect, because of their standard form, the influence of Northern Ireland Office officials who advise the Minister or the Secretary of State. An uncaring attitude is coming through in those letters. Does my hon. Friend further agree that, when we as public representatives look seriously at a case relating to one of those young offenders held at the Secretary of State's pleasure, who has completed a lengthy sentence to date, and we seek advice from the local RUC superintendent, who does not find grounds to oppose the release of such a prisoner, the Minister and the Secretary of State should give more credence to our representations?
Mr. Maginnis: I thank my hon. Friend for his intervention, in which he made a valid point. I have evidence. Consider the despair of a parent who received from a Minister on 1 December 1981 a letter that stated:
"I can assure you that your representations on your son's behalf will not be overlooked in future reviews."
Another letter in April 1982 stated:
"but would assure you that your son's case will continue to be reviewed."
Another letter dated 18 May 1983 stated:
"but would assure you that your son's case will continue to be reviewed."
Yet again in February 1984 a letter stated:
"Nevertheless I can assure you that your son's case will continue to be reviewed."
How can the Northern Ireland Office continue to send out that sort of callous, repetitive and meaningless mishmash to parents who are growing old, wondering whether the child who was taken from them by the violence of the 1970s will ever cross their threshold and sit at their table again in their lifetime?
Some broken-hearted parents are already gone. Others believe that they, too, will fail to live to see that day. In this specific matter, can we blame parents who are gradually losing hope for such despair? Can one blame my colleagues and me as we strive to build a better society in Ulster if we feel that our hands are tied? Can one understand how those young people, as they still have no release date to look forward to, must inevitably become institutionalised and, finally, unfit to take their place in society?
I began my speech with an outline of the role of the godfathers in the mid-1970s. Let us remember that the same godfathers are still a virulent cancer in our society, wasting it and draining its very lifeblood. They feed and flourish on grievances, both real and imaginary, but the family is still the most influential unit in Ulster. It can submit to paramilitary pressure if it feels aggrieved and hopeless, or it can feel that society does care and become the bastion against such evil. If we continue to set our faces against the SOSPs as we have appeared to do, the godfathers will exploit them, parading their families on our streets at every opportunity.
The next phase is more recruits, and the wheel will have turned full circle. I have never feared the terrorist with his false or manipulative grievance, nor have I feared him with his imaginary grievance. But it is a foolish man who provides him with a real grievance.

667
I plead with the Government tonight to try to find a way to make progress. Ensure at least that a separate panel is established with no other mandate than to review the specific cases. With all our problems we do not need 60 Rudolf Hesses in Ulster.
After 10 years these boys, now young men, must as a matter of simple justice be told when they can expect to be released. It has been seen over the years that Secretaries of State come and go, Ministers come and go, but we who live in Ulster must remain. In spite of our grief and suffering and difficulties we still have a mind to reestablish the caring society we once knew.
The Minister, I know, will want only to assist us along that road. I believe that he will not set his face against the unanimous will of all those who are elected to serve the people of Ulster or against the welfare of those who were 10 years ago the weakest and most vulnerable of our citizens. If Ulster can care, if Ulster can forgive, who would hinder that first step forward?
Rev. William McCrea rose——
Mr. Deputy Speaker (Mr. Ernest Armstrong): Has the hon. Member the permission of the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) and the Minister to address the House?
Mr. Maginnis: I hope that the Minister will have time to reply.
11.52 pm
The Under-Secretary of State for Northern Ireland (Mr. Nicholas Scott): I intend to do that. I was content for the hon. Member for Mid-Ulster (Rev. William McCrea) to speak for one or two minutes, which I understood was his intention, if the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) was also content.
I am grateful to the hon. Member for Fermanagh and South Tyrone for raising this issue tonight, so early after the reassembly of Parliament, and for bringing before the House the question of those young people who are serving indeterminate sentences, the sentence being imprisonment during the pleasure of the Secretary of State. I shall try to cover as much of the ground as he did and I think that I can deal with virtually all the main points that he raised.
As the hon. Gentleman knows, I take a close personal interest in the cases that come up for review. I shall deal with the points about the tone and content of the letters which are sent to those who make representations on such cases later.
The sentence is described somewhat differently in the comparable legislation in Britain. In England and Wales the sentence for those convicted of murder under the age of 18 is that they are to be detained during Her Majesty's pleasure. That was formerly the terminology in Scotland as well, although in the Criminal Justice (Scotland) Act 1980 the mandatory sentence of equivalence is described there as detention without limit of time. Many may feel that is a more accurate description of the sentence that is imposed.
The reference in the Northern Ireland legislation to the Secretary of State arises as a consequence of the introduction of direct rule. The powers were formerly vested in the Governor of Northern Ireland acting on behalf of Her Majesty and they passed to the Secretary of State under the direct rule legislation.
668
I must remind the House that all those people who have been sentenced to this punishment in Northern Ireland have been convicted of murder. The House has particularly in mind more recent events, but we should not forget the catalogue of horrors that have been inflicted by men of violence on the people of Northern Ireland over the past 14 or 15 years. Every single one of those young people has been convicted of murder. I am bound to say that I know of no difference in the way that the courts come to a view about a decision convicting someone of murder depending on the age of the person concerned. Evidence must have been presented in court to enable it to convict someone of that crime.
As the hon. Gentleman has reminded the House, a conviction for murder can mean many different levels of involvement in the crime. But we should, nevertheless, remember that we are dealing with the crime of murder and those responsible for it. At the moment in Northern Ireland there are about 60 young men serving this type of sentence for a crime committed in most cases when they were very young— some of them as young as 14. The previous Secretary of State, my right hon. Friend the Member for Waveney (Mr. Prior), said in reply to a written question last November that in considering indeterminate sentences generally — that is to say both life sentences and pleasure cases—he would deal with them in a way that fully reflected their gravity. I believe that the public would expect us to make sure that that element was reflected in the length of time served in prison, quite apart from the special circumstances of Northern Ireland to which the hon. Gentleman so eloquently referred. The approach outlined by my right hon. Friend the Member for Waveney is also that of the present Secretary of State.
I receive and see letters that are written by the families of some of these young men, and I know the uncertainty that the pleasure sentence creates, both for the inmates concerned and the families outside. The hon. Gentleman drew comparisons with persons who are sentenced to fixed terms of imprisonment and who can calculate precisely when they will be released, provided that they do not lose their remission. But I am afraid that that element of uncertainty is inevitable—although I recognise the strain that it can cause — as long as the law makes an indeterminate sentence the mandatory penalty for murder.
There is no way in which the authorities can predict at an early stage how long a person will be required to serve under an indeterminate sentence. That is for the Secretary of State of the day to decide after consultation, as required by law, with the Lord Chief Justice and the trial judge, if he is available.
The hon. Gentleman made several comments about the lack of official information given to inmates and their relatives about the procedures for the review of indeterminate sentences. That is something that I have very much in mind at the moment. I am aware that both the Home Office and the Scottish Office have a useful information leaflet that is freely available to inquirers. I am considering whether we might have a similar document in Northern Ireland and whether we might develop procedures for informing inmates of the results of reviews of their cases. But I do not want to turn this procedure for review into some quasi-judicial process. If people have been sentenced by the courts to indeterminate sentences, it is a matter for the Executive to decide when they may be released on licence back into the community.

669
Nevertheless, without going too far down that road, I believe that there is a very good case for more information being given to the families outside and the inmates. In the not too distant future I hope to be able to give the House some further information on that front.
I should like to say a word or two about the review and reporting procedures. The duty on the Secretary of State to release prisoners sentenced to indeterminate periods because they have committed the crime of murder—and in life sentence cases, other grave crimes—is a very onerous responsibility which I believe all Secretaries of State, including the present one and his predecessor, treat very seriously indeed. I said before, and reiterate now that the public will expect those who have been convicted of serious crimes to serve a period that appropriately marks the gravity of them. We know only too well of some of the atrocious outrages that have been committed in Northern Ireland in recent times.
We also have to be clear that the public will not be put at risk by the release of somebody who might become involved once again in violence or paramilitary activity. Those factors have to be taken into account, and of course the behaviour of the person while in prison may provide a very good clue to the likelihood of them re-offending once released.
Mr. Maginnis: Does the Minister agree that we release many people who have been imprisoned for terrorist offences—which are only just a little less than murder—and that those adult, mature terrorists become involved again and again in terrorism? There is much evidence of that. When young people of perhaps 14 years of age have to serve 10 years — equivalent to 20 years of a determinate sentence—it is more than a lifetime.
Mr. Scott: Because some people who have served a determinate sentence imposed by the court become reinvolved with terrorism, that is no reason for letting out people who are serving an indeterminate sentence. It is onerous responsibility to decide whether people who have been convicted of murder are likely to involve themselves again in violence.
I shall explain a little about the way in which we decide whether people should be released on licence. Cases are reviewed at regular intervals by the Northern Ireland prison department. Reviews are conducted on the basis of full information about the crime, the prisoner's part in it, his age and background at the time and reports from the prison in which the inmate is serving his or her sentence.
670
It is a caricature to describe the procedure as a 10 or 15 minute interview with the governor of the establishment in which the prisoner is detained.
The review is conducted day by day and involves assessing the behaviour of the prisoner as he comes in touch with prison officers and others in the establishment. All reports are taken into account. At an appropriate time cases are referred to a life sentence review board chaired by the permanent under-secretary of State at the Northern Ireland Office. The board then makes recommendations to Ministers about release. There are no hard and fast rules about the timing of reviews, paticularly in the later stages. Cases are considered on their own facts and merits.
Since 1981 seven people serving sentences of detention during pleasure have been released on licence or have had provisional release dates set. That is seven out of a total of over 60 — a not insubstantial proportion of those sentenced. Further cases are due to come up for review. I would expect the trickle of releases to continue, subject to proper consideration of the gravity of the offence of which the young people have been convicted and a proper assessment of the likelihood of re-offence.
Youth and immaturity at the time of the crime are important consideraions in the reviews. I am as aware as the hon. Member for Fermanagh and South Tyrone of the role that the "Godfather" played in encouraging many young people down the road which led to prison.
The hon. Gentleman said that many relatives of such inmates believe that their letters have produced bland and unhelpful responses. It would be wrong if those letters, which are as courteous and helpful as possible, aroused hopes which were incapable of being fulfilled in the hearts of families. When we cannot make a forecast we should not raise hopes which might then be dashed.
It is difficult to conduct a day-by-day assessment when prisoners are confined to compounds. Those whoo chose to remain in compounds are not outside the review procedure. We do our best within the limitations of the compound system to judge behaviour and likelihood of re-offence.
Each individual case is carefully reviewed in the light of the circumstances of the crime and all other relevant factors. The age at the time of the crime is taken fully into account. I take a close personal interest. I am aware of the factors which the hon. Gentleman mentioned tonight. I hope in due course that it will be possible for more of these young people to find their way back into the community and to play a constructive part in the life of Northern Ireland.
Question put and agreed to.
Adjourned accordingly at five minutes past Twelve o'clock.

NATIONAL FINANCE
  Heroin
  Heroin
  Civil Service (Information Technology)
  Civil Service (Information Technology)
  Imports (VAT)
  Imports (VAT)
  Dunlop
  Dunlop
  Johnson Matthey
  Johnson Matthey
  Finance Council Meeting
  Finance Council Meeting
  PAYE
  PAYE
EDUCATION AND SCIENCE
  European University Institute
  European University Institute
  GLC (Abolition)
  GLC (Abolition)
  British Scientists (Emigration)
  British Scientists (Emigration)
  Special Teachers
  Special Teachers
  >"Parental Influence at School"
  >"Parental Influence at School"
TRANSPORT
  Motorway Construction (Hampshire)
  Motorway Construction (Hampshire)
  London Regional Transport
  London Regional Transport
  EC Budget (Refunds)
  EC Budget (Refunds)
TRADE AND INDUSTRY
  Ceramic Sanitaryware
  Ceramic Sanitaryware
  Libya
  Libya
  Dangerous Toys
  Dangerous Toys
  Small Workshops Scheme
  Small Workshops Scheme
AGRICULTURE, FISHERIES AND FOOD
  Veterinary Investigation Centres
  Veterinary Investigation Centres
  Tuberculosis
  Tuberculosis
EMPLOYMENT
  Occupational Health and Hygiene Services
  Occupational Health and Hygiene Services
  Leicester (Ministerial Visit)
  Leicester (Ministerial Visit)
  Share Ownership (Employees)
  Share Ownership (Employees)
PRIME MINISTER
  Taoiseach
  Taoiseach
  Fontainebleau Summit
  Fontainebleau Summit
  Ogmore
  Ogmore
  St. Cadoc's Hospital, Gwent
  St. Cadoc's Hospital, Gwent
  Engagements
  Engagements
  Liverpool
  Liverpool
  GLC (Abolition)
  GLC (Abolition)
WALES
  Hospital Waiting Lists
  Hospital Waiting Lists
  Occupational Medicine
  Occupational Medicine
  Health Authorities (Nurses' Pay)
  Health Authorities (Nurses' Pay)
HOME DEPARTMENT
  Prisoners (Statistics)
  Prisoners (Statistics)
  Broadcasting Complaints Commission
  Broadcasting Complaints Commission
  Isle of Man
  Isle of Man
  Wormwood Scrubs
  Wormwood Scrubs
  Police (Injury Statistics)
  Police (Injury Statistics)
  Local Elections 1986
  Local Elections 1986
SCOTLAND
  Legal Aid
  Legal Aid
  Scheduled Monuments
  Scheduled Monuments
  Salmon and Freshwater Fisheries Act 1951 (Convictions)
  Salmon and Freshwater Fisheries Act 1951 (Convictions)
  Nuclear Bunker, Coupar Angus
  Nuclear Bunker, Coupar Angus
  Assisted Places Scheme
  Assisted Places Scheme
  Fee-paying Schools (Rates Relief)
  Fee-paying Schools (Rates Relief)
FOREIGN AND COMMONWEALTH AFFAIRS
  Libya (British Citizens)
  Libya (British Citizens)
  Hong Kong (Child Labour)
  Hong Kong (Child Labour)
  Africa (Ministerial Visit)
  Africa (Ministerial Visit)
  Anglo-Libyan Relations
  Anglo-Libyan Relations
  Cayman Islands
  Cayman Islands
  Diplomatic Immunity
  Diplomatic Immunity
DEFENCE
  Widows (Pensions)
  Widows (Pensions)
  VC10 Tanker Contract
  VC10 Tanker Contract
  Competitive Tendering
  Competitive Tendering
  British Aerospace (Woodford Factory)
  British Aerospace (Woodford Factory)
  Faslane Submarine Base
  Faslane Submarine Base
  Military Bases (Accidents)
  Military Bases (Accidents)
  Military Bases (Emergency Services)
  Military Bases (Emergency Services)
  European Aircraft Programme
  European Aircraft Programme
  Royal Marines (Landing Assault Ships)
  Royal Marines (Landing Assault Ships)
  United States Bases and Facilities
  United States Bases and Facilities
ENVIRONMENT
  Projected Housing Demand
  Projected Housing Demand
  National Federation of Housing Associations
  National Federation of Housing Associations
  Private Rented Accommodation
  Private Rented Accommodation
  Liverpool (Ministerial Visit)
  Liverpool (Ministerial Visit)
  St. George's Hall, Liverpool
  St. George's Hall, Liverpool
  International Garden Festival Site
  International Garden Festival Site
  South Yorkshire (Rates)
  South Yorkshire (Rates)
  Wembley (Amusement Centres)
  Wembley (Amusement Centres)
  Ronan Point
  Ronan Point
  Blocks of Flats (Management)
  Blocks of Flats (Management)
  Rates Act
  Rates Act
SOCIAL SERVICES
  NHS Expenditure
  NHS Expenditure
  Greater Manchester (Health Services)
  Greater Manchester (Health Services)
  Community Care (Cost)
  Community Care (Cost)
  Housing Benefit (Overseas Students)
  Housing Benefit (Overseas Students)
  Supplementary Benefit Claimants (Earnings Limit)
  Supplementary Benefit Claimants (Earnings Limit)
  Civil Defence
  Civil Defence
  Hammersmith Hospital
  Hammersmith Hospital
  Hip Replacement Operations
  Hip Replacement Operations
  Drugs Advisory Council (Report)
  Drugs Advisory Council (Report)
  Merseyside (Mental Health Services)
  Merseyside (Mental Health Services)
  Dentists
  Dentists
  St. Thomas's Hospital
  St. Thomas's Hospital
  Death Grant
  Death Grant
  Preglandin
  Preglandin
  NHS (Land and Property Sales)
  NHS (Land and Property Sales)
  NHS Staff
  NHS Staff
  Depo Provera
  Depo Provera
  Sickness Benefit
  Sickness Benefit
  NHS Staff (Residential Places)
  NHS Staff (Residential Places)
  NHS (Ancillary Services)
  NHS (Ancillary Services)
  Child Care Law
  Child Care Law
  Cot Deaths
  Cot Deaths
  Social Security Expenditure
  Social Security Expenditure
  Nurses and Midwives (Pay)
  Nurses and Midwives (Pay)
  NHS (Managerial Posts)
  NHS (Managerial Posts)
  Hearing Aid Batteries
  Hearing Aid Batteries
  North-West Thames Regional Health Authority
  North-West Thames Regional Health Authority
  Oncology Nursing Society (Conference)
  Oncology Nursing Society (Conference)
  NHS (Performance Indicators)
  NHS (Performance Indicators)
  Cyclotron Machines
  Cyclotron Machines
  NHS (Low Energy Neutron Therapy)
  NHS (Low Energy Neutron Therapy)
  Dental Treatment (Children)
  Dental Treatment (Children)
  Nurse Teachers (Redundancies)
  Nurse Teachers (Redundancies)
  Kidney Patients (Treatment)
  Kidney Patients (Treatment)
  Tobacco Advertising
  Tobacco Advertising
  Health Authorities (Chairmen and Vice-chairmen)
  Health Authorities (Chairmen and Vice-chairmen)
  Private Health Care
  Private Health Care
  Hospital Meals (Privatisation)
  Hospital Meals (Privatisation)
  Disabled Persons
  Disabled Persons
  Invalidity Pension
  Invalidity Pension
  Coal Industry Dispute
  Coal Industry Dispute
  Hospital Waiting Lists
  Hospital Waiting Lists
  NHS (Patient Statistics)
  NHS (Patient Statistics)
  Community Care
  Community Care
  Capital Allocations
  Capital Allocations
  Health Authorities (Joint Finance)
  Health Authorities (Joint Finance)
  Rates Acts (Penalties)
  Rates Acts (Penalties)
  Binder Hamlyn Report
  Binder Hamlyn Report
  Drug Addicts
  Drug Addicts
  Perinatal and Neonatal Mortality
  Perinatal and Neonatal Mortality

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

Death by Reckless Driving: Disqualification
Lord Monson: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will introduce legislation to amend Section 93 of the Road Traffic Act 1972 so as to ensure that persons convicted of causing death by reckless driving are disqualified for at least three years.
Lord Brabazon of Tara: My Lords, the Government agree that there should be severe penalties for those who are guilty of recklessly killing and injuring others on our roads. We have no present plans to change this particular law, but my right honourable friend the Secretary of State for Transport has been giving further thought to the subject of road traffic law generally and hopes to make an announcement shortly.
Lord Monson: My Lords, I thank the noble Lord for that reply. Would he agree that we are not talking about death caused by careless driving but of death caused by deliberate reckless driving, often under the influence of drink or drugs? This being the case, can he visualise any circumstances in which disqualification for as much as three years for this grave offence would be excessive?
Lord Brabazon of Tara: My Lords, the average disqualification is, in fact, of three years. The last available figures were those for 1982, during which 251 people were convicted of causing death by reckless driving. The vast majority of those people were disqualified, 67 per cent. of them for periods of three years and over. Nearly half those convicted were also given prison sentences, mostly of up to 12 months but in some cases longer.
Lord Paget of Northampton: My Lords, does the noble Lord not feel that this sort of proposal casts an unwarranted reflection on the competence of the judiciary? Can we not really assume that they are in a better position to judge the appropriate sentence, when they know all the circumstances, than we who know none of them?
Lord Brabazon of Tara: My Lords, I would agree. Only the courts have access to all the relevant facts of a particular case. They will therefore be in the best position to make judgments appropriate to those facts. The Magistrates' Association does issue to benches its own suggestions on appropriate sentences for magistrates' courts; and the Lord Chief Justice has
128
recently called for severe sentences, including prison, for those who kill because of drink or extreme recklessness.

The Miners' Strike: Fines
2.38 p.m.
Lord Orr-Ewing: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what has been the total of fines levied on the 6,000 pickets who have been arrested in the current miners' dispute. what percentage of these fines have been paid, and how many fines have been less than £5.
The Minister of State, Home Office (Lord Elton): My Lords. the information which is available about the 7,318 pickets arrested up to 16th October is not exactly in the form which my noble friend asks for. However, I can tell him that fines for offences committed in England and Wales in connection with the dispute have been imposed on 1,244 people at the following levels:
Six people have been fined under £10; 94 people have been fined from £ 10 to £24; 167 from £25 to £49; 226 from £50 to £74; 332 from £75 to £99; 265 from £100 to £149; 50 from £150 to £199; and 104 people have been fined £200 and above. The cost of finding out the percentage of those fines that have been paid would be disproportionate.
Lord Orr-Ewing: My Lords, can my noble friend say whether one of the factors in setting the level of fines is the amount of damage done to public property that will have to be met by taxpayers from all over the country? Is it true, as reported, that the current rate is £14 a day for Scargill's private army plus travel expenses? Is it true therefore that at the lowest end some of these pickets are making a very handsome profit out of the operation?
Lord Elton: My Lords, it is not for Her Majesty's Government to comment on the decisions of individual courts in individual cases. The decision as to what is an appropriate fine in any case must belong entirely to the courts. In making it, they are required under Section 35 of the Magistates' Courts Act 1980 to have regard to the means of offenders so far as they are known.
Lord Mishcon: My Lords, would the noble Lord the Minister care to make it abundantly clear to the House—if it is not transparently obvious already—that to try and judge statistics in regard to criminal offences without knowing the nature of the offence, without knowing the mitigating circumstances or matters relevant to previous character, would be thoroughly injudicious, mischievous and misleading?
Lord Elton: My Lords, it is, as I say, not for Her Majesty's Government to decide on what the courts ought to award in any individual case. But my noble friend of course had an absolute right to ask the substantive Question that stood in his name.
Lord Renton: My Lords, is my noble friend aware that the duty of the court to award compensation where appropriate is scarcely dependent at all upon the factors mentioned by the noble Lord, Lord Mishcon?
Lord Elton: My Lords, I am aware of that fact, but I think that we are discussing fines and not compensation.
Lord Jenkins of Putney: My Lords, would the noble Lord agree that the use of such phrases as "Scargill's private army" reflects more upon the noble Lord who uses them than upon anyone else?
Lord Elton: My Lords, I think that anyone who reflects upon the circumstances will regard them as unfortunate and unconstitutional, but the bounds of the Question on the Order Paper forbid us debating that matter.
The Earl of Lauderdale: My Lords, can my noble friend say whether Her Majesty's Government are reviewing the state of the law in regard to these disturbances and whether they think that the law at present is adequate or that the police are necessarily the best people to deal with it?
Lord Elton: My Lords, the state of the law as regards public order has been under review for some time.
Baroness Lane-Fox: My Lords, can my noble friend the Minister say what percentage of the arrested pickets were themselves miners by trade?
Lord Elton: My Lords, my information is that the number arrested who are miners is 6,828, which is about 93 per cent. of all those arrested.
Lord Orr-Ewing: My Lords, the noble Lord opposite seems to abhor statistics, but surely it would be in our interests to have some statistics. Is it not rather ridiculous that 2,000 miners from as far away as Durham turned up at a very small pit in Yorkshire this morning in order to picket one man who wished to exercise his right to go to work?
Lord Elton: My Lords, Her Majesty's Government have strong views on these matters, but they are not on the Order Paper.
Lord Leatherland: My Lords, if we are to have statistics, might they include the very large number of miners who are now threatened with dismissal?
Lord Elton: My Lords, again, Her Majesty's Government have very strong views on that, but that matter is not on the Order Paper.

Overseas Aid as a Proportion of GNP
2.44 p.m.
Lord Oram: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether it is still their intention to attain the 0.7 per cent. of gross national product target for overseas aid.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, we remain committed to the United Nations target but, like the previous Government, we are not prepared to set a date for achieving it.
Lord Oram: My Lords, do not the latest figures show a still further decline in the provision of aid as a percentage of GNP and has not that proportion declined, while this Government have been in office, from 0.52 per cent. to 0.35 per cent.? Are we not, year by year, going in the wrong direction? Is not this a shameful situation in contrast to the European countries, most of which have a very much better record than we have? In the cases of France and the Scandinavian countries, they have already attained the 0.7 UN target. Should we not be reversing the situation and going upwards rather than downwards?
Lord Trefgarne: My Lords, it is true that our aid as a percentage of GNP has fallen since 1979 but I think the figure for that year—0.52 per cent., which the noble Lord refered to—was exceptionally high for reasons unrelated to the actual level of expenditure. The reason is that the OECD count our aid to the World Bank when we deposit notes at the Bank of England and not when the World Bank actually spends the money. This causes year to year fluctuations in our measured performance. We have consistently exceeded the 1 per cent. UN target with a total of official and private flows. In 1983 the amount was 1.25 per cent.
Lord Bauer: My Lords, what is the point of such a target? Should not the size of our aid programme depend on its effectiveness and on our economic situation and not on an arbitrary figure derived from the Pearson Report of 1968?
Lord Trefgarne: My Lords, I certainly think that our aid budget ought to be determined in accordance with the funds that we have available to support it, and, indeed, in accordance with the effect to which those funds are put, as my noble friend says. As to the existence of a target, although we have had to make the observations which we have about reaching that target—which incidentally were made by our predecessors in exactly the same way—it does perhaps serve a useful purpose with some of the more laggardly nations.
Lord Hatch of Lusby: My Lords, does the noble Lord recall that last Thursday his noble friend Lord Lucas, in answering a Question from me, indicated that the Government, by refusing to give aid and assistance to a tender from British Aerospace, were losing both the contract for Britain and the employment that would have been so provided? Can he tell the House whether it is not the case that British overseas aid provides employment in Britain, and can he say by how much that employment has been

131
reduced as a result of the reduction of British overseas aid since 1979? Secondly, can he tell the House why it is that the British Government believe they are unable to provide this money because of the world recession when, for instance, the Dutch Government, who are also suffering from the world recession, have now surpassed not just 0.7 per cent. but 1 per cent. of their country's GNP?
Lord Trefgarne: My Lords, if I may say so, I think that the noble Lord oversimplifies these matters. It is possible to suggest—although it is by no means proven—that money spent overseas or granted overseas for aid purposes finds its way back to our economy, but I hope the noble Lord will not overlook the fact that that money in fact came from the British taxpayer in the first place and therefore has been taken out of the economy anyway.
Lord Taylor of Gryfe: My Lords, in answer to a Question yesterday the Minister expressed his deep and genuine concern about conditions in Ethiopia at the moment. Would he accept that it would be a practical expression of that concern if a more determined effort was made to increase the aid funds from the United Kingdom Government and to attain the target of 0.7 per cent. of GDP? Is he further aware that at the end of the war, when this country was devastated, we committed 1 per cent. of our GDP to overseas assistance to less fortunate countries, and would he suggest that moral standards have declined since those days?
Lord Trefgarne: My Lords, no; I do not think the moral standards of today are any lower than the moral standards of other times. But I do believe that we must determine our aid budget in accordance with the resources that we can make available from the Government's resources generally. I do not think we have done at all badly with regard to aid. The figure for the last couple of years has shown a modest increase and I hope very much that we shall be able to continue that, although I could not guarantee it.
Lord Oram: My Lords, reverting to the question that was asked by the noble Lord, Lord Bauer, and the answer which the Minister gave to him, is it not perfectly reasonable that the United Nations and UNCTAD should use a percentage of the GNP as the proper yardstick for measuring a country's performance in these matters? Is not the GNP the measure of the resources that are available, to which the Minister referred?
Lord Trefgarne: My Lords, the figure for which the noble Lord has asked me, and the one which I have given, is, as the noble Lord knows, the percentage of GNP constituted by official development assistance. We in this country, as it happens largely for historical reasons, actually provide very substantial sums for similar purposes from private sources, and that is the figure to which I also referred a little later in my answer.
Lord Hatch of Lusby: My Lords, would the noble Lord be so courteous as to answer the question which I asked and which was also asked by my noble friend Lord Oram? Why is it that he continues with this gramophone record, saying that we cannot afford it and that we have to tailor our aid according to our resources, when on the continent of Europe, in similar circumstances, that aid has been increased despite the recession?
Lord Trefgarne: My Lords, I am not responsible for what countries on the continent of Europe do, but I can say that our predecessors failed to have regard to the level of our resources, and look at the mess that they got us into!
Lord Jacques: My Lords, will the Minister bear in mind that the previous Government did not have the advantage of £10,000 million in oil taxation?
Lord Trefgarne: My Lords, I think that the disadvantages of the previous Adminstration would take me rather longer to recite than Question Time allows.

Privacy and Media Coverage
2.53 p.m.
Lord Airedale: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they believe that pictures on television and in newspapers of victims of bomb attacks being extricated from rubble amount to an unwarrantable invasion into privacy and ought not to be permitted.
Lord Elton: My Lords, the Government believe that even in this sensitive area editorial decisions must in the first instance be a matter for the broadcasters and the press themselves, though they can be reviewed by the Broadcasting Complaints Commission and the Press Council in the light of complaints from those who believe that their privacy has been unwarrantably infringed.
Lord Airedale: My Lords, I am obliged for that Answer, but are there not intensities of pain, distress and suffering which are such that one has to say, "This person on this occasion must be allowed to suffer in private and not under the public gaze"? Can we really trust the whole of the media always to respect this right to privacy?
Lord Elton: My Lords, the press and the broadcasters have a clear responsibility to take account of the reasonable susceptibilities of the public, of the dignity and privacy of those who are the victims of this type of outrage and of the need to convey the horror of what has happened. The BBC, the IBA and the Press Council have their own guidelines on the portrayal of violence and suffering. I would hope that reporters and photographers would do unto those whom they observe as they would wish them to do unto them.
Lord Mishcon: My Lords, is it not a fact that standards of good taste at editorial level, whether it be in the national press or on television or radio, have to many of us dropped considerably? Is it not the hope of all of us that those standards will be looked at by the persons concerned?
Lord Elton: My Lords, the advantage of having the bodies to which I have referred is that they can be aware of the expression of opinion which your Lordships so powerfully make.
Lord Peyton of Yeovil: My Lords, would my noble friend agree that those responsible for the particularly intrusive medium of television frequently give the impression that they are more concerned to excite and to entertain than they are to show regard for the individual, no matter how painful the circumstances?
Lord Elton: My Lords, in this delicate area there are established bodies which are in position in order to oversee these matters, and it is not for the Government to make pronouncements on them.
Lord Somers: My Lords, while I sympathise with the noble Lord's Question, would the noble Lord, Lord Elton, agree that in this particular case it was perhaps necessary to bring home to the public the true horror of the situation in order that it should be taken seriously?
Lord Elton: My Lords, the noble Lord is right that there is a balance to be struck here. The privacy of the individual and standards of good taste must at all times be considered. But the nation itself needs to see the degree of horror of some of the deeds committed against it. That is the only qualification that I would put on what I said previously.
Lord Campbell of Alloway: My Lords, I should like to ask my noble friend the Minister whether Her Majesty's Government have any plans to put the Press Council on a proper statutory basis, because in many quarters there is much dissatisfaction as to the way in which it has worked over the past five or 10 years.
Lord Elton: My Lords, your Lordships have turned your attention to the Press Council on a number of occasions in the last few years. At present I am not aware of any intention to revise the situation.
Lord Broxbourne: My Lords, my noble friend has referred to guidelines. While these may be very useful and persuasive in their way, is there not a case for them being reinforced with something a little more realistic and substantial in the form of sanctions? Will the Government give consideration to the possibility of a review of that position?
Lord Elton: My Lords, the Press Council is not a statutory body and it does not have sanctions available to it in the same sense as the other two bodies have, which can require publication of their findings. As to guidelines, I am certain that it will be aware of what has been said today because I shall ensure that copies of your Lordships' proceedings are sent to the council,
134
and it will be able to consider those in conjunction with its guidelines.
Lord Hunt: My Lords, does the Minister agree that it would be no bad thing if the Press Council and the Broadcasting Complaints Council gave a clear definition of what is proper in the public interest and what may be of interest to the inquisitive instincts and inclinations of certain members of the public which are pandered to in order to sell newspapers and to make people turn on their television sets?
Lord Elton: My Lords, the difficulty as I see it is that whereas all of us, when we see something in print or on the screen, have a clear view as to its moral position—whether or not it is intrusive or offensive—it is very difficult to put that into cold print. I suspect that what your Lordships are in fact in part saying is that you do not agree with the interpretation of the guidelines.

Business
Viscount Long: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Avon will, with the leave of the House, repeat a Statement that is to be made in another place on first elections to the Inner London Education Authority.
It may be for the convenience of the House if I announce that dinner will be available at the usual time of 7.30 this evening.

Co-operative Development Agency and Industrial Development Bill
2.58 p.m.
Read a third time.
Clause 2 [Extension of functions and control of Agency]:
Baroness Nicol Baroness Nicol moved the amendment:
Page 2, line 44, at end insert—
("(2) The Agency's Annual Report shall include details of all such directions and of the Agency's replies thereon to the Secretary of State.").
The noble Baroness said: My Lords, I beg to move the amendment which stands in my name on the Marshalled List. This amendment is similar to one which we discussed at the Committee stage but which was in fact not moved. At the Report stage the Minister was reassuring about the life of the agency, but the direction of its activities was not discussed. Some of us have doubts about the Government's objectives for the agency in the long term, and it would be reassuring to know that the information asked for in this amendment would be available annually.
The Minster's reply at the Committee stage on 30th July, at col. 565, was as follows:
"The Secretary of State can be questioned on the use of the power"—
a question which I had particularly asked—
"either in Parliament or through the department".
However, questions on specific points which may have come to light are no substitute for complete information which will give us the drift of the Secretary of State's control. On several occasions the noble Lord the Minister mentioned that these were reserve powers which might not be much used. If that is so, then our amendment should not add significantly to anyone's workload. I beg to move.
Lord Graham of Edmonton: My Lords, very briefly, I rise to support the very reasonable amendment which has been moved by my noble friend Lady Nicol. More than once during the passage of this Bill the Minister has told the House that he has some difficulty in giving illustrations as to why certain powers are being sought, but nevertheless he said that it is better to have them than not to have them.
The Minister has sought powers to wind up the agency, but last week he had difficulty in giving us illustrations of the kind of circumstances in which the winding up was likely to be merited. Again, the Minister and his colleagues have gratuitously introduced this power to give directions to the agency and yet have failed to convince me—and incidentally his colleagues failed to convince my colleagues in another place—that there was a need for it. After all, this is the Government that do not believe in intervention. They believe in electing or appointing people and letting them get on with the job. However, the Minister takes the view that there will be occasions when the Minister concerned will think that the CDA needs to be directed as to the kind of activities and the kind of behaviour that it should adopt.
My noble friend has quite simply said that there may very well be a happy resolution of a problem between the Minister and the CDA, where they are satisfied and he is satisfied. The amendment does not seek a cosy relationship; it wants the taxpayers as well as the parliamentary scrutineers to be made aware of what it was that caused the intervention. If the Minister would accept this most reasonable amendment, I think he would be giving aid and comfort to those of us who believe that so far as possible the Government's books should be open. I cannot conceive of any direction which is given by the Minister which would not be proper to be made public. If the Minister is in a reasonable mood I believe that he can do something that he has failed to do during the passage of this Bill—that is, accept a reasonable amendment.
Lord Campbell of Alloway: My Lords, I should like briefly to oppose this amendment. The amendment falls into two parts. The first part states:
"The Agency's Annual Report shall include details of all such directions".
Speaking personally, I can see no objection to that. This is done in many other agencies, Monopolies Commission reports and so forth. But it is the second part to which I object. It reads:
"and of the Agency's replies thereon to the Secretary of State".
With the greatest respect to those who have moved this amendment, if under Clause 2(4) the agency has to comply with the directions of the Secretary of State (and this is no longer in question), what on earth, one
136
may ask, is the object of publishing the agency's replies? There is no precedent for this type of situation. Perhaps consideration might be given by Her Majesty's Government as to whether the agency's annual report should include details of directions. As I say, I can see no objection to that. But with the greatest respect I suggest that the second part of the amendment is misconceived.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth): My Lords, I am grateful to the noble Baroness for explaining the purpose of her amendment, but I believe that both she and her noble colleague are showing something of an unnecessary concern over what is, after all, a reserve power. I emphasise again that this is a reserve power. I thought I made it quite clear during earlier stages of the Bill that the power of direction has been introduced as a counterpart to the extension of the agency's functions and in particular the removal of the restriction on commercial activities. The Government have thought it proper to take account of the possibility, however remote it may be, that the agency might misuse its new powers at some stage. When I say "might misuse" I do not necessarily mean wittingly; it could, in fact, misuse the powers unwittingly, and I shall explain how I see that in a moment.
It is a little invidious to give examples because the Government have confidence in the CDA board, which as I explained in our discussion last week has recently been reappointed with some new members, and they have confidence in the director. Nonetheless, as the noble Lord. Lord Graham, has asked for a specific example, I can only draw on a hypothetical one because I cannot see the need for this reserve power. So I have to use a hypothetical example. Let us suppose that with a different management structure perhaps in a few years' time the CDA developed a particularly lucrative commercial activity, which would be quite within the new functions which are contained in the Bill before us. Let us suppose that it then decided to ignore its other responsibilities in order to concentrate on that activity. It might well be a circumstance in which my right honourable friend the Secretary of State would believe it right to give some direction to turn the attention of the agency back to its main function.
That point is not totally academic because complaints about unfair competition have arisen in the past. In explaining his objection to the amendment, in dealing with the first part of it, my noble friend Lord Campbell of Alloway drew attention to the fact that these powers were contained in a number of other Acts, and he enumerated some of them. In fact, there are a number of others.
The noble Lord, Lord Graham, asked: why should I envisage a situation where the CDA needs to be given direction? I think that I have answered that question; I do not see the CDA as needing to be given a direction. The main objection to the amendment is that first we doubt whether it would be necessary to use the power of direction. But if it were used, there is certainly no intention to "gag" the agency in any way if it disagreed with the Secretary of State. We welcome free discussion, particularly in these areas, and during

137
the passage of this Bill since the summer I have sought to illustrate that to your Lordships. In the event of the Secretary of State giving a direction, I should find it extremely difficult to keep this matter secret because the actions of the agency would demonstrate that something has happened and it would not take very long before the fact that a direction had been given would be elicited.
If the Secretary of State made a direction, it may very well not be in the interests of the agency itself that such a direction should be made public in the report. As my noble friend Lord Campbell of Alloway suggests, having given the direction, there can be no point in the agency's response being printed in an annual report. By that time it would have responded.
There may of course be another scenario in which the agency would not want a direction made public, and I say that because I notice that the noble Lord, Lord Graham of Edmonton, shook his head at my earlier remark. For instance, the agency could be involved in negotiations over the acquisition or possibly the disposal of a property. Although it is unlikely, I suggest that it is not inconceivable that a direction might be given regarding such negotiations. If that fell at a time when the annual report were to be published and the amendment before us this afternoon were to be accepted, it would be incumbent upon the agency to report that such a direction had been given in that annual report. Such a report would have to disclose that negotiations were being undertaken. I would think that that could easily be to the detriment of the agency.
I have given only two examples because I find it difficult to think up others because it is a reserve power which we quite optimistically do not feel is likely to be used, but for the reasons I have given nevertheless we think it prudent in a matter of this kind that there should be that reserve power. I do not think that I can add anything more to what I have said. Perhaps with that explanation the noble Baroness may feel inclined to withdraw her amendment.
3.11 p.m.
Lord Beswick: My Lords, I think the House will agree that the Minister has tried hard, but I cannot think that he has convinced many people that he has right on his side. One of the features of this Bill is that there has been a general feeling on all sides of the House that we are after the same objectives. There has been no amendment down that I know about that has not been put down in good faith, and where the spirit of it was not understood by noble Lords opposite. The argument has often been rather narrowly balanced. But with a little more generosity the noble Lord opposite could have accepted some of the amendments, and he really ought to be able to accept this one.
The noble Lord went to some lengths to show that they were not intending, and did not expect, to have to use their power of issuing directions very often. I think we accept that. The noble Lord also went to some length to suggest that if the agency went beyond their powers contained in the eventual Act it would probably be unwitting, and I think we accept that. But
138
if there is a difference of opinion as to how the powers of this Bill should be interpreted, a difference between the Government on the one hand and the agency on the other, are we not now trying in this country of ours to get people to understand, to get the general public to understand, what is involved and what the facts are? We have too much misunderstanding. We have too many occasions when there are great arguments in the country, and often based on incomplete information.
If there is a difference of opinion between the Government and the agency I, as a member of the public, should like to know what the gradations of opinion are. What are the differences? Why was it that the agency thought that they had powers when the Government decided that they had not powers? Even at this late stage I would hope that the Minister would try at the very last to see whether he could give way on this particular point. He is not giving anything very much away. He is only indicating that they really have faith both in the agency and in the future interpretation of the Act.
Baroness Nicol: My Lords, I do not wish to prolong the debate but I should like to say for the benefit of those many noble Lords present who were not present at the earlier stages of the Bill that a lot of the amendments arose because the Bill before us is an extension of the life of a body which has been in existence for some years, has been doing a good job which the Government have admitted on many occasions, and indeed they have praised it for the job it has done—and suddenly in this Bill extending its life we find a whole range of new powers given to the Minister. They include, although I do not want to dig it up again for too long, the powers to dissolve the agency itself. It seems to us on this side that there must be reasons for the new powers that are being taken. We have failed to find satisfactory reasons for any of them, though the Minister has done his best to reassure us.
We therefore can hardly be blamed if we are slightly suspicious of this particular new power. We see it not as a defence of the agency to keep these things secret but as a way of perhaps allowing the Minister to change the direction of the agency, which has been given new commercial powers and which is therefore capable of having its direction changed in ways in which it was never intended to function in the first place. We are therefore worried that these powers may be used to change the direction of the agency. Therefore we simply sought to have the Minister's directions published at the end of the year so that we could satisfy ourselves that these powers were not being misused. Does the Minister wish to intervene?
Lord Lucas of Chilworth: My Lords, with the leave of the House, I should like to respond to the noble Baroness, and indeed to the noble Lord, Lord Beswick. I can only say again—and this must be the fifth or sixth time that I have sought to reassure your Lordships on the intention of the Government with regard to the Co-operative Development Agency—that we have provided funding for six years, we have recently appointed a new board, and we have sought to meet the requirements of the agency in opening its functions and its activities.

139
Noble Lords have spoken about the other amendments. They are behind us. We have debated them. I would only remind your Lordships that the noble Lord, Lord Graham, said last week that he was probing with certainly two of his amendments. He had asked the same question: "What are your intentions?" He had asked it many times, and I had given him the self-same answer to the self-same question. He thanked me for that and said, "Well, at least that message is getting home to some people".
There is no subterfuge on the Government's part with regard to the refusal of amendments. I have sought to explain logically our refusal to accept this amendment. I said earlier that perhaps I had nothing else to say. However, the noble Lord, Lord Beswick, sparked off something else. We do not in this Bill forbid the inclusion in the annual report of the CDA anything that the CDA wish to include. They can do what they like. If we accept the amendment that the noble Baroness and others seek to impose on the Bill, what we do is place an obligation upon the agency——
Lord Beswick: My Lords, the noble Lord has said something very important, and I just want to make it clear. Is he saying that the agency would be free in their annual report to give details of the direction and of their reply to it?
Lord Lucas of Chilworth: My Lords, I know of nothing in the Bill that gives any kind of direction to the agency as to what they shall include in their report. If we accept" the amendment, then we impose upon them an obligation to do certain things. It is an obligation which they may not wish under certain circumstances. I have sought to describe one of them, the property deal. I think that the noble Baroness and her noble friends are being unduly sensitive about this matter.
Baroness Nicol: My Lords, I do not wish to prolong the debate. The Minister has done his best in a rather difficult situation. I am reassured to hear that the agency is free to publish what it will in its annual report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lucas of Chilworth: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Lucas of Chilworth.)
Lord Taylor of Gryfe: My Lords, before the Bill passes, may I say that I have had a lifelong association with the co-operative movement and the co-operative idea, and I wonder whether I may say a word of welcome and congratulation to the Government on the passing of this Bill. The Government are frequently charged with obsessive belief in the virtues of private enterprise. In passing this Bill and guaranteeing the continued existence of the Co-operative Development Agency they have recognised the relevance of the co-operative idea in the mixed economy of the United Kingdom.
I felt only one little twinge of embarrassment about it, because I am not too keen on organisations going to
140
the Government for assistance. I read the balance sheet of the CWS and the CIS today, and noted their massive investments in private enterprise—quite rightly. Ordinary shares in the CIS are £1·2 billion. The CWS is the largest wholesale trader in this country—successfully, I am glad to say. I can only express, through the Minister, to my friends who represent co-operative interests in this House, that perhaps this encouragement from the Government will stimulate the existing co-operative movement to play its full part in developing co-operative activities within the Co-operative Development Agency.
3.20 p.m.
Lord Bruce of Donington: My Lords, the noble Lord, Lord Taylor of Gryfe, has dealt with the Co-operative Development Agency part of this Bill, but as some of your Lordships may have noticed the Bill also comprises, in Part II, an industrial development Bill. In the course of the Second Reading debate and in Committee I passed some observations as to the incongruity of this position of the Co-operative Development Agency (which deals, if I may say so with respect to my friends in the co-operative movement, with a comparatively small segment of the United Kingdom) forming Part I, whereas the industrial development Bill, which by its implications is of very considerable interest to the entire United Kingdom, comprises Part II. It is of interest particularly to those millions of unemployed who are currently within the development areas, whether they be assisted areas, development areas or special development areas, or whether they are in the West Midlands area, which now qualifies to be a development area but is not, so far, in it, and where there is considerable unemployment at this time.
I have protested before, and I renew my protest, that Part II of the Bill ought to have been a Bill on its own, discussed on its own merits within the wider context to which it relates. But this has not been done. It is almost as though the Budget resolutions in another place had been appended as Part II to a gaming Bill, which is a very incongruous position. It is my view and the view of my noble friends that this course of action, taken in haste, was so that the new powers granted to the Minister would pass virtually unnoticed without any regard to the nationwide repercussions that the decisions that he makes, and is empowered to make under the Bill, would have.
I do not want to repeat much, if indeed any, if I can help it, of what I have said at previous stages of this Bill. But it is necessary to remind your Lordships—at least, it may be necessary—that of the 25 identified poor areas in Europe no fewer than 10 are in the United Kingdom. Of the 12 worst poverty areas in Europe, no fewer than five are in the United Kingdom.
I have been hopeful, ever since this Bill started in this House, that the Government would be prepared to give a far greater indication of what they propose to do. The only powers that have been taken in this Bill have been to redefine the criteria on which aid is supposed to be granted. What they have not done, and what they could have done, is to tell the House how they propose to use these powers. They could have told the House, as indeed has been the practice before.

141
what were the new classifications for assisted development and special development areas, and how, if at all, the new areas varied from those in the 1982 Act, which in its turn amended the 1972 Act. But they have done none of these things, and one wonders why. It is true enough that information has been leaking out, not from the Department of Industry but from the Department of Employment. There has been a gradual influx of information, available in the Library, of course, which gives some clues as to what would happen if, for example, the new aid were directed in regard to areas based on travel-to-work areas. But as the noble Lord knows quite well, in the Bill those are not the only criteria. Clause 4 mentions wards in addition, parliamentary constituencies and so on.
The Department of Employment Gazette for September this year now gives information on what would happen if these other classifications were brought into effect. For this we are very grateful. Why is it, then, that the Government have not been able to introduce this Bill after a proper explanation of what they propose to do? Is it possibly due to unresolved differences in the Cabinet itself because there are different philosophies, each one of which has some bearing on the decisions that have to be made?
Mr. Norman Tebbit, for example, speaking quite recently—I am referring to a report in The Times of 12th October—said this:
"The market system, allied with free enterprise, gives a better allocation of capital and human resources than any other yet devised".
In view of the existence of 20 million unemployed in Europe as a whole and some four million here, one can beg to doubt that bold assertion, which indeed was doubted by his colleague, Mr. Walker, who ventured to qualify the whole matter by saying:
"The market economy idolises people as consumers and as long as the market mechanism is working it does give consumers a wide freedom of choice. But people are more than just consumers. They are workers, managers, householders and students.
Consumer freedom for them is one aspect of a free society, an important aspect … Progressive Tories cannot rest easy if Government restricts their activities to just oiling the wheels of the market economy".
Is there, therefore, a battle in the Cabinet which has produced the indecision which has in turn produced no further information as to how the Government propose to apply regional aid?
Regional aid is of great significance in seeking to correct those manifest instances of where the free market economy does not work. If the free market economy worked to the benefit of all in the United Kingdom and all the differences between regions were self-adjusting by the working of the market, that would be one thing; but they are not. The magnitude of the Government's expenditure on the regions—expenditure necessary to bring new life and new hope into areas of Wales, the North of England and other areas—is based fundamentally on an admission that there, precisely because the free market mechanism has not worked, the state must take corrective and ameliorative action and must by some means inject sums into those localities in order not merely that life can be preserved there—and they are now covering a much larger area than they were in 1979—but also
142
that those living there, and in particular the young people, are able to formulate purposes in life; are able, yes, my Lords, to have dreams of a future. And there is nothing wrong in having dreams.
Therefore, the Government's expenditure under this head and the extent of that expenditure are one measure by which the country as a whole can judge this Government's determination to encourage growth where growth is most sorely needed; to prevent dereliction where there is growing decay; to engender hope and purpose where there is now despair, disillusionment and cynicism. This is, or should be, the whole purpose of the regional development and the funds that are made available to it by the Treasury.
We have heard frequent homilies about Government expenditure, and we are told from time to time that the funds made available, coming as they do out of taxpayers' money, must be scrutinised with great care and kept to the absolute minimum. It is quite clear, from the context within which the debates in Committee, on Second Reading and on Report have taken place, that it is the intention of the Government drastically to cut down the money that they have hitherto spent in the regions themselves. A figure of as much as £200 million has been mentioned, although I fully understand that the noble Lord opposite cannot possibly confirm or deny that figure. However, I would remind the House when it comes to social priorities that the Government are quite willing to spend £200 million of taxpayers' money, if we believe the accuracy of the Financial Times article on the subject, on the promotion of the sales of shares in British Telecom—money paid out in commission to bankers, commission to accountants, underwriting fees, publicity, printing and all the rest of it. That apparently is good and desirable expenditure of taxpayers' money in order that British Telecom may be piratised by their rentier friends.
Are the Government going to take regional development seriously at all? The indications are that they are not. I do not want unduly to trespass on the content of the next debate on the Order Paper, which deals particularly and in very great detail with regional development affairs. It is very convenient, presumably, to have them on the same day—and I must commend the Government Chief Whip on this—because if I stray into the discussion on the report now I shall be told that I shall have a later opportunity of dealing with the matter, and if in the European Regional Development Fund debate that is going to take place next I omit something that relates to the United Kingdom, I shall then be told that I really ought to have raised it in the previous debate on the passing of the industrial development Bill. So the Government are in a very good position here.
The Government's attitude to regional development as a whole in the United Kingdom, particularly when one relates it to the other priorities upon which they are prepared to squander vast sums of taxpayers' money, is a public scandal and should be regarded as such. However, the asperities that I have seen fit to make do not prevent me from saying that we on this side of the House very much appreciate the manner in which the noble Lord. Lord Lucas of Chilworth, has dealt with this Bill. No matter how unpleasant and how inconsequential much of it has been to those of us

143
on this side of the House, and despite the acerbities that have been hurled at him from time to time, and despite a certain degree of robustness with which the arguments have been addressed to him, he has maintained his unfailing courtesy and has certainly dealt as well as he possibly could with the various matters raised in the Bill. For this we thank him; but it does not prevent us from regarding the Bill itself as the most miserable bit of trivia that has ever been inflicted upon the House.
3.34 p.m.
Lord Graham of Edmonton: My Lords, may I take a little of the time of the House by first expressing our appreciation, echoing the words of my noble friend Lord Bruce, of the unfailing courtesy of the Minister in piloting this Bill through the House. At all times he has tried to be helpful. Very often he was unable to be helpful, but at all times he tried. The fact that there have been proscriptions upon spelling out what we wanted him to spell out did not stop us from time to time trying to get him to do just that. I speak from these Benches not with the authority but with experience of the co-operative moment, primarily the consumer co-operative movement. I can certainly tell the Minister that the view that is held in the consumer co-operative movement is that we value the extension of the life of the CDA, recognising, as the noble Lord, Lord Taylor of Gryfe, has said, that there are many ways in which the co-operative idea can be applied.
What we have seen—and to some extent this is thanks to the work of the CDA in the previous six years—has been a flowering of the co-operative idea in many ways which augurs well for the future. At one time the consumer co-operative movement was paramount. Now it has to recognise (and it welcomes) the presence of an extending worker/producer co-operative movement, a housing co-operative movement, a credit co-operative movement and the agricultural co-operative movement, which is not a recent phenomenon and has been well established over time.
The Minister is well aware of the two prime reservations that have been mentioned from this side as far as the CDA is concerned. One is the issue of the power to direct, and the other the power to wind up. The Minister has sought to assure us that these are almost benign. We fear that they may very well turn out to be malignant. The Minister has gone some way to assure us that as far as he is concerned he sees a full six years' life ahead for the CDA. As he has pointed out, the funds are there in order to ensure it. The co-operative movement will watch the next six years—and we wanted to have six years—with a great deal of pride in what we have been able to do so far in establishing the CDA. We recognise that the Minister has said as much as he possibly can to make sure that the CDA has firm directions in the changing of the functions, and also has the cash.
Reference was made by the noble Lord. Lord Taylor of Gryfe, to the value that the existing co-operative movement can be to the new co-operative movement. Certainly I can say with some authority that we have been very pleased to make available the expertise and the knowledge which repose inside the co-operative
144
movement, to make sure that our sucessors are given a fair wind. I am very grateful indeed to the Minister for wanting to dispel any gloom which the co-operative movement may have felt. We do not intend to be gloomy. We are optimistic for the future and we certainly wish the CDA well.
Lord Lucas of Chilworth: My Lords, I feel that I should respond very briefly. I am obliged to the noble Lord, Lord Taylor of Gryfe, for his comments, particularly on Part I of the Bill. The Government firmly believe that the co-operative form of enterprise has a potential and will contribute quite significantly to the creation of new businesses and jobs. We recognise the important role of the CDA, and I can say no more about that.
I must confess I was somewhat amused by the noble Lord's remarks with regard to the co-operative movement as a whole; and when the noble Lord, Lord Graham of Edmonton, said that the movement was pleased to support the agency's activities with their expertise and so on, I was rather hoping that perhaps he was going to add in parenthesis, "We might even put some cash alongside that".
I would not say that the noble Lord, Lord Graham, does not speak with authority. It was the authoritative way in which he conducted his arguments during the course of the Bill that I personally found most helpful. The whole House recognises that he is an authority on the Bill. When he says he hopes that the CDA will go for its full term of six years, I say to him, "Six plus what?—six plus six plus six?" The aim of the Government, in loosening the bonds of the agency, is that it should become more self-supporting and then go on perhaps to bigger and better things. He and I share that belief, I know.
Lastly, I should like to turn to the speech of the noble Lord, Lord Bruce of Donington. First, let me thank him for the latter remarks in his contribution this afternoon. They followed much the same pattern as his remarks that were made that Friday afternoon in the summer. Today he is pleased that we have got two similar debates on the same day, but we had two that Friday in the summer, of course, but he did not like that and I wondered why.
Let me just answer two main points. He said, "This is a wretched little Bill" and he thought there should have been two Bills. He knows as well as I and the rest of your Lordships the pressures of legislation. He knows also—because we have discussed it—that both Houses of Parliament will have the opportunity of debating the detailed changes this Bill allows for—details which he keeps pressing me to give him but which I have told him I am unable to give at this time. I did say last week that most of this would be out by the end of this year. Then we shall have those orders put before Parliament, and both Houses will be able to debate them; so there is nothing hidden at all.
The other point he made some fairly heavy weather of, I thought, was when he talked about Cabinet decisions, our monetary policies and the like. I would just finish by saying that of course we recognise the social need for regional grant and regional help. I explained earlier that the Bill was to change the way this was done. We did not believe that the old way was

145
either cost-effective or well targeted, and this Bill provides for changes in the method. For the first time, the White Paper upon which this Bill is based recognises the social significance of regional policy; and that is why the Bill, as we have explained on a number of occasions during its passage, targets that support on jobs. That, I believe, is a social priority and it is one which this Bill will support in its entirety. I beg to move.
On Question, Bill passed, and returned to the Commons with the amendments.

ILEA: Elections
The Parliamentary Under-Secretary of State, Department of the Environment (The Earl of Avon): My Lords, with the leave of the House, I shall repeat a Statement about the timing of the first direct elections to the new Inner London Education Authority, which is now being made in another place by my right honourable friend the Secretary of State for Education and Science. The Statement is as follows:
"The Government announced earlier this year that in the light of the consultations which they had carried out they had decided that the new Inner London Education Authority to be formed on the abolition of the Greater London Council should be directly elected. During the passage through Parliament of the Local Government (Interim Provisions) Act 1984, it was also decided that the term of office of the existing GLC members (from whom the bulk of the ILEA membership is drawn) should be extended from May 1985, when elections would have been due, to April 1986, the proposed date of abolition. We have been considering how best to secure continuity for the administration of education in inner London through the transition.
"The Government have concluded that the first direct elections to the authority which will succeed the ILEA should be held in May 1986 to coincide with the London borough elections. We propose that the new corporate body which is to take over the functions of the ILEA from 1st April 1986 should be established, like the new joint boards, in September 1985, in order to prepare the budget and fix the precept for 1986–87 and make other necessary preparations.
"From its establishment until the elections in May 1986, the new body would be composed of the present members of the ILEA (who will, of course, also continue to constitute the existing authority as a special committee of the GLC until 1st April 1986). Later elections would also coincide with those for the borough councils.
"Unlike other services for which the GLC has a responsibility, the functions exercised by the ILEA will be exercised by a single directly elected body. The new authority will differ from the existing ILEA only in the method by which it is constituted. In these circumstances it is appropriate to place the responsibility for the preparatory work which the new authority will need to undertake on the existing members of the ILEA.
146
"This provides the best guarantee for continuity of administration and a smooth transition to the new arrangements and is consistent with the Government's decision to enable GLC members, including those who are members of the ILEA, to continue to perform their functions until 1st April 1986."
My Lords, that concludes my right honourable friend's Statement.
Baroness David: My Lords, I should like to thank the Minister for repeating this Statement. We are glad that the elections will be held at the same time as the borough elections in May 1986 and that later elections will also coincide with those for the borough councils. This obviously means a better turn-out at the polls.
I have a few questions about the establishing of the new body in September 1985. How will this be done? Under what authority? What powers will it have? Also, is it a case of pre-empting legislation, the GLC abolition Bill, which we have not yet seen?
On the second page of the Statement it says:
"The new authority will differ from the existing ILEA only in the method by which it is constituted".
How is it to be constituted? What will the representation be? Will there be nominees from the boroughs and from the City of London, as there are now, and will there be co-opted members?
We appreciate the Government's desire that there should be continuity of administration and a smooth transition to the new arrangements: that is a sensible recognition of the need for continuity in the best interests of the education service. I should like to ask, in preparing the budget and fixing the precept for 1986–87, under what constraints will the members be? In 1985–86, the Government say there has to be a £75 million cut in expenditure. Is the new authority to have greater freedom when it is fixing the precept?
Lord Beaumont of Whitley: My Lords, we too should like to welcome the Statement and indeed join the noble Baroness in welcoming the timing of the elections. That seems to be an extremely sensible suggestion and the procedures so far outlined in this Statement appear to be of the right kind. We on these Benches have always been in favour of a directly elected ILEA, unlike some other noble Lords on this side of the House who are late converts to the idea, and we certainly hope that this will be a successful experiment. The question which the noble Baroness, Lady David, raised about the financial constraints under which the new authority will operate is a very pertinent one. Will it in fact have freedom to operate as it should within the limits which are necessary in London, and can we have some assurance—this is presumably the case—that the costs of the elections for the ILEA—and there are bound to be some costs, even though they are taking place at the same time as the borough elections—will in no way come out of the education budget?
The Earl of Avon: My Lords, I am grateful both to the noble Baroness and to the noble Lord for their reception of this Statement and of the idea of these elections in May 1986. As the noble Baroness rightly

147
thought, the authority for the elections will be in the Bill on the abolition which will be put before the House in the new Session. That is one of the reasons why nothing can happen before September 1985, because one would not expect Royal Assent to the new Bill until July next year.
We are looking to exactly the same representation on the interim committee as there is now, and we very much hope that the same people will continue in office. In the same spirit, the same conditions will affect the budget for the year after this one as have affected this one, and the same terms will apply. The noble Lord, Lord Beaumont, asked me about the costs of the elections. I do not have a brief on that. It is an interesting point and I shall find out for him what our thinking is on that subject.
Lord Alport: My Lords, may I ask my noble friend whether he realises how difficult it is sometimes for laymen like myself to understand the full implications of a ministerial Statement? But would I be right in supposing that what this means is that the present ILEA will continue until May 1986 in two guises—first, as an established committee of the GLC until the GLC ceases to exist, and then subsequently as the new corporate body which will administer education in London until the elections take place? If that is the case, then may I ask my noble friend whether he realises that the discussions which we had in this House earlier in this Session with regard to this particular problem were concerned primarily with the essential continuity of the administration of education in London, and in so far as this plan produces that continuity and enables the future elected body to take over from the existing one in one day, so to speak, it will be greatly welcomed by those who are governors of London schools, the staff of the Inner London Education Authority and all those who have the interests of education in London at heart?
The Earl of Avon: My Lords, I am grateful for my noble friend's welcome and I can say that the whole purport of this is the essential continuity which he describes. What will happen is that the present ILEA will take on a new hat in September 1985 and the same people will be wearing two hats until the abolition of the GLC in 1986.
Lord Kilmarnock: My Lords, the noble Earl has told us that the authority for the new ILEA will come in the abolition Bill. Can he tell us what other details will come in the abolition Bill? Shall we know about the numbers for each borough and the method of election? Does not this timing give the Secretary of State time to issue a consultation document on these important matters; that is, the numbers of representatives from each borough, whether there will be any co-opted members and the method of election?
The Earl of Avon: My Lords, I hope that we shall have plenty of time to discuss this during the spring of next year and to listen to any noble Lord's suggestions on this matter.
Lord Boyd-Carpenter: My Lords, in view of the high-spending record of the current ILEA, and my
148
noble friend's reference in his reply to my noble friend Lord Alport as to continuity, may I ask whether he can give some indication as to what constraints will be placed on the new ILEA as to the size of the precepts which it might levy on the London boroughs?
The Earl of Avon: My Lords, in answer to my noble friend, of course the precepts will be as they are now——
Lord Boyd-Carpenter: Oh dear!
The Earl of Avon: At the moment, we are looking at the expenditure limits of the present budget and we shall continue to look at it in the same way as we are now.
Lord Beloff: My Lords, as one who took some part in the campaign for an elected ILEA, may I indicate that not everyone will be wholly pleased about the fact that the elections are to be on the same date as the borough elections? One of the chief arguments that we put forward was to try to separate in the minds of London's electorate the educational issues of the capital from the other issues concerning local government which come up in ordinary borough elections. It is clearly no use asking the Government to change their mind on this aspect, but might I ask the noble Earl the Minister whether he would put to his honourable friend the idea that in the elections there should certainly be a distinction and that on no account should the ballot paper be a single one for both authorities?
The Earl of Avon: My Lords, of course I appreciate what my noble friend has said and equally what other Members of the House have said: that this will be an opportunity for people to elect two bodies on the same day. I asked the same question as my noble friend when I was given the briefing on this subject, and of course this is a point which we can raise when we debate the abolition Bill in the new year.
Lord Underhill: My Lords, may I follow up the question of the noble Lord, Lord Kilmarnock? Is it proposed that there will be a separate Bill in the form of a representation of the people Bill, which will outline the whole question of the conduct of the elections; will these matters be dealt with in the abolition Bill or merely by a clause there referring to sections on the conduct of elections, or have the Government not considered this aspect?
The Earl of Avon: My Lords, the idea is that this will be part of the abolition Bill.
Lord Dean of Beswick: My Lords, does the noble Earl agree that the previous speaker's suggestion, that the administration of education can be divorced from local government, is nonsense, bearing in mind that all of the local authorities outside the Greater London area have the responsibility of looking after the education of the people in those areas? Is the Minister aware that that is an accepted fact? Those of us with a history in local government were always taught that there were three political forces in local government—Conservative. Labour and the education lobby. I think

149
that on this occasion the Government have got it right in keeping them separate.
The Earl of Avon: My Lords, I am grateful for the noble Lord's support and I am sorry that the right reverend Prelate has not spoken also.

European Regional Development Fund: ECC Report
3.58 p.m.
Lord O'Brien of Lothbury Lord O'Brien of Lothbury rose to move, That this House takes note of the report of the European Communities Committee on the European Regional Development Fund (23rd Report, 1983–84, H.L.274).
The noble Lord said: My Lords, this is the fund which nowadays is commonly known as the ERDF—a piece of shorthand which I shall use frequently in my forthcoming remarks. This is the fourth report by the committee on this subject since 1977. The ERDF was set up in 1975 to correct the structural and regional imbalances within the Community which might impede the realisation of economic and monetary union. Its purpose was to aid the improvement of economic performance in the poorer regions of the Community, with particular emphasis on job creation in order to bring about a higher degree of convergence among member states.
The economic circumstances of the Community have changed radically since 1975, and economic and monetary union has receded into the distant future, even for those who sincerely desire it. It is still accepted, however, that excessive regional disparities are harmful to the Community and that without the ERDF they would be greater than they are.
The Regional Fund therefore has widespread if not universal support. The committee are aware that there are those who question the whole concept of regional aid, feeling that it does more harm than good and that the vast sums spent on it could be put to better use in other ways. Such arguments are not without force, but neither in this nor in their earlier reports on the subject have the committee felt it their duty to enter into a general discussion of the validity of regional aid.
Regional aid programmes exist, and doubtless will continue to exist, on a massive scale in all Community countries. The committee were concerned with how far the ERDF supports or enlarges such programmes and how far it promotes Community rather than national objectives. In the 10 years of its existence, the ERDF has grown to be the second largest regular charge on the Community budget after—admittedly a long way after—the Common Agricultural Policy.
At present, the ERDF awards grants each year to a total value of over £1 billion to projects from all over the Community. Even so, it remains a relatively small charge on the budget, absorbing in recent years between 5 and 8 per cent. of the available resources. And, of course, ERDF disbursements are very small compared with member states' own regional spending, which ranges from at least 10 times to 50 times the
150
European contribution. Ninety-five per cent. of this contribution has hitherto been allotted under a system giving fixed quotas to individual countries weighted in favour of the poorest countries, which are Ireland, Italy and the United Kingdom. Our quota at present is 23·8 per cent. of the 95 per cent. The remaining 5 per cent. of the ERDF is distributed on a non-quota basis, reflecting Community rather than national priorities.
In the mid-1980s the ERDF is making grants each year some seven times the cash value of those made in the first three years of its existence. After making allowance for inflation, this still represents a substantial real increase in Community spending on regional aid, and this larger expenditure has been concentrated increasingly on the poorest and poorer regions of the Community.
Despite this, disparities in prosperity between the different regions of the Community appear to have widened since the early 1970s. Poorer regions have, not unnaturally, failed to grow as quickly as the richer, and some formerly prosperous regions have fallen on hard times. Happily, these divergences are no longer increasing, but to go further and reverse the trend will not be easy. If present plans, as enunciated at Fontainebleau, for more effective controls over Community budget expenditure are successful—and there is no certainty yet that they will be—more funds for regional aid should become available. But any such increase is not likely to be anything like big enough to have a massive impact on regional imbalances, even supposing that national governments were prepared to allow Community regional aid to supplement their own regional aid programmes.
This brings me to the vexed question of additionality, which your committee have discussed and probed over many years. Clearly, Community contributions to regional aid would be much more worthwhile if they truly supplemented a national regional aid programme rather than being used just to finance a part of that programme. In some marginal instances this does appear to happen but, in the main, governments simply pocket the Community contributions as a set-off" against their own regional expenditure. Nevertheless, in the United Kingdom, for example, an elaborate process goes on year after year under which numerous proposals for ERDF aid are prepared by local and regional authorities and, if accepted by the Department of Trade and Industry, are submitted to Brussels for consideration. In this laborious way we manage eventually to lay our hands on our quota entitlement, to the minimal advantage, as your committee saw it, of the regional authorities who make successful applications.
Between 1975, when the ERDF was created, up to the end of 1982 almost £1 billion of ERDF aid—and the fact that that figure is similar to the one I quoted earlier is quite coincidental—has been paid or promised to the United Kingdom in respect of some 4,232 regional projects. Most of these were to create new infrastructure in eligible regions. While there never seems to be a shortage of such projects, it is a little depressing to note that not only in the United Kingdom but in all member countries since 1980 there has been increasing difficulty in generating investment projects suitable for ERDF aid from manufacturing

151
industry or from the craft or service sectors. This is partly responsible for the inordinate delay in all Community countries in taking up quota entitlements.
The evidence supplied to your committee did not suggest that the general administration of the ERDF was entirely satisfactory. There seemed to be some lack of co-ordination between the various directorates-general in the Commission concerned with these matters while, at the Council of Ministers, regional policy is apparently decided by foreign ministers rather than those directly responsible for regional questions. This led the committee to conclude that there should be a Council of Ministers with specific responsibility for regional policy closely co-ordinating their work with the relevant national authorities.
Likewise, evidence concerning United Kingdom procedures did not show a reassuring picture. The December White Paper on regional industrial development raised doubts about the whole future of United Kingdom regional policy—if, indeed, there is a coherent policy covering the whole country. Some regional authorities are very effective in this area. In other places they hardly exist. The Whitehall departments clearly keep a firm grip on all questions of regional aid but they could do with more forceful advice, not only from some but from all relevant areas. The regional development agencies should cover all areas and be more effectively used. This would perhaps be most likely to happen if one leading minister with one department behind him were to be responsible for regional policy.
The Council of Ministers have been discussing a reform of the ERDF for some two and a half years and, after sitting on proposals from the Commission for most of that time, in an unexpected burst of activity and decisiveness last May-June approved revised proposals by the Commission which broadened the scope of the ERDF and seek to increase Community influence in the field of regional aid. Almost all the evidence received by the committee was favourable to the new proposals. I shall try briefly to summarise them.
The division of the fund into quota and non-quota sections will go. Each country will in future have a flexible quota range. To achieve the maximum allocation within its range, each country will have to offer programmes for ERDF aid in competition with the other member states. Acceptance will depend on whether proposals meet Community rather than simply national policy objectives.
The regulations of the ERDF will also give formal eligibility to integrated operations—that is, those which bring together a number of the Commission's agencies acting in concert: for example, the Social Fund, the Regional Fund and the European Investment Bank. Similar status will be given to the assistance of internally-generated development schemes in poorer regions. Most importantly, there will be a phased replacement of individual proposals for project finance by finance for broader, co-ordinated programmes which it is hoped will have more impact on regional development.
Your committee welcome all these changes but they are at this stage no more than an expression of good
152
intentions. It remains to be seen whether the use of the ERDF can be effectively directed towards Community ends; in particular, whether real and substantial additionality can be achieved. Certainly it cannot be without acceptance by member states. Administrative arrangements both in the Commission and by member states need to be overhauled to eliminate the long delays which now occur in ERDF disbursements. Finally, more attention must be given to the need to create employment—especially long-term employment.
To conclude, I repeat that there seems to be little prospect that the European Regional Development Fund will be so substantially increased in the foreseeable future as to enable it to make a decisive contribution to the solution of the problems of regional imbalance. I beg to move.
Moved, That this House takes note of the report of the European Communities Committee on the European Regional Development Fund (23 rd Report, 1983–84, H.L. 274).—(Lord O'Brien of Lothbury.)
4.11 p.m.
Baroness Carnegy of Lour: My Lords, I am sure that we are all grateful to the noble Lord for his clear and concise introduction to what seems to me to be an admirably clear report. In so far as the report goes, and within the limits which the sub-committee set itself, I agree with the contents, and I agree, with certain reservations which the report makes clear, that the new ERDF regulation is an acceptable updating and improvement of previous arrangements.
As the noble Lord has said, the committee did not see it as its duty—rightly so, in my view—to embark upon discussion of the validity of the whole concept of regional aid as part of the Community's activities. But, as the noble Lord also said, it does acknowledge that there are those who have their doubts. I venture to suggest that Parliament and the Government should also have doubts; that your Lordships should not regard endorsement of this regulation in the short term as a satisfactory end to the story in the longer term.
The justification for the operation of the regional fund must surely be judged in the context of the objectives of the Community as a whole. As the report says, the objective of economic and monetary union is no longer immediately in front of us. The objective now is seen as mainly political; a growing understanding and sense of unity in Europe—a working and acting together to mutual advantage. But what does the regional fund look like to the ordinary person?
If I may take the Scottish experience, which is familiar to me, as an example—and it is not a bad example because, as the report points out, Scotland's arrangements make it one of the parts of the United Kingdom best placed to take advantage of the fund—the first action a person sees being taken by the regional fund in his locality is a notice in the press announcing that the local authority has applied for a certain sum from the fund. The second thing he sees is that the application has or has not been granted. And that is that. The project proceeds with little more mention at all of the EEC—but plenty of mention, of course, of the project.

153
It looks good at the time, although most people perceive this aid as simply part of what has been paid into the fund coming back again—and they are not entirely wrong in thinking that. If they knew the actual cost of the bureaucracy involved in that circulation of funds, they might be even less enthusiastic. There is the cost to local government of putting together the application, the cost to the taxpayer of the co-ordination in the industry department within the Scottish Office, the cost of more co-ordination in the United Kingdom's Department of Industry and in the Community, the cost of the decision by the Community, and then of the disbursement of the funds. No figure can ever be stated, but it must be very large.
Nor would people be encouraged if they knew what their elected members suspect; that the amount which comes to them by this roundabout route for a road, reservoir, sewerage scheme or coastal protection scheme may simply be docked off the United Kingdom's regional aid which they might otherwise get for something else. So quite apart from doubts about the effectiveness of regional aid as a concept, is it the right way nowadays for the EEC to be operating? Is it the best way of demonstrating to people the importance of belonging to the Community? I would suggest that it is not.
This is not the occasion to go into what the alternative might be, but there may be lessons to be learnt from the success of one of the modes of operation of the Social Fund, where pilot schemes are set up in individual member states. Their success or lack of it is closely monitored and reported upon, and that experience is shared and built up within the Community. That system seems to work well.
Perhaps innovative pilot schemes could be set up in each member state under the regional fund to try out ideas for creating long-term jobs and self-employment opportunities, with plenty of publicity and interchange of results, and with the countries then building on one another's talents and experience. Perhaps pilot schemes of that kind would help people identify with the Community more than they do at present as a result of the regional fund. That is just one possibility as to how, at much less cost and with much less bureaucratic effort than that involved in the present schemes, the benefits of Community co-operation and shared talent and experience could help and be seen to help the areas which need that help most.
In any case, it is, alas, clear from this summer's European elections that the present operation of the Community is as yet worryingly unconvincing to the electorate of Europe as a whole. Despite a campaign and election organisation costing £25·6 million, and with 42 million of the electorate under civic or legal obligation to vote, only 57 per cent. of them voted—5 per cent. less than last time. The lowest turnout of all was in this country.
I submit that, if it is true that the regional fund should be a major shop window for the European Community, then the present concept of direct regional aid is probably not the best one and that better ideas in the long term should be sought. Until then, I warmly accept this excellent report.
4.19 p.m.
Lord Banks: My Lords, the whole House will be grateful to the noble Lord, Lord O'Brien of Lothbury, and to his committee for the production of this most valuable report. We are also grateful to the noble Lord for the way in which he introduced the report to the House this afternoon.
When we last discussed this subject in June 1982 we were considering the 1981 proposals of the Commission for a revised regulation. After two years of negotiation those proposals were revised by the Commission in November 1983, and a new regulation, partly based upon that revision, was agreed by the Council of Ministers in June 1984. In that debate in 1982 I said that in all three of the reports that the committee had up to that time made—in 1977, 1981 and 1982—it had been concerned with five main problems: the size of the fund; the vexed question, as the noble Lord called it, of additionality; the method of allocation; the problem of access to the Community; and the participation in decisions by regional and local authorities and the need for a comprehensive and significant overall regional policy.
It is clear from this latest report, which we are now considering, that these five issues remain dominant. First of all, there is the size of the fund. It is true, as the noble Lord, Lord O'Brien, said, that in real terms the fund has increased in size and that it is now the second largest regular charge on the Community budget, after agriculture. But as he pointed out, agricultural expenditure is many times greater—in fact, about 10 times greater—than expenditure under the fund. The fund disburses £1 billion to projects all over the Community. That sounds a large amount of money until one reflects that the United Kingdom Government alone spends over £15 billion a year on defence and over £30 billion a year on social security. The £1 billion is then seen in perspective, and it represents about 0·08 per cent. of the Community's gross domestic product. Other Community policies, of course, particularly the agricultural policy, have a different regional impact upon the fund.
The purpose of the fund is stated again in the report and was stated by the noble Lord this afternoon. It is to correct the structural and regional imbalances which might affect realisation of economic and monetary union. While, as the report says, disparaties would have been worse without the fund, we have to acknowledge its very limited nature and face the fact that such a comparatively small fund could not possibly correct the structural and regional imbalances within the Community—disparities which have grown considerably since the 1970s, even if there is now evidence that they have ceased to grow further. Clearly we must maintain the pressure for a considerably increased allocation of funds for the regional fund.
Additionality is the next point. It is now widely agreed that, while governments may say that they take into account what they expect to get from the European Regional Development Fund in making their plans for development, there can be no proof that they do so. It is not easy to say whether any extra activity takes place as a result of the fund or whether the fund merely relieves the burden on taxpayers and ratepayers of what would happen in any event. This

155
greatly restricts the incentive to local authorities to take an interest in applying for help from the fund and provides no incentive for private business firms. The committee says that a greater element of additionality is needed if confidence in the usefulness of the fund is to be maintained. I am sure it is right to say that. It also says that additionality will only occur when individual member states decide that that is what they want. It implies that in Britian the reverse is the case because, it states,
"It seems that the United Kingdom is expecting the European Regional Development Fund to pay in future for a higher share (in money terms) of a much reduced national regional aid scheme".
I should like to ask the noble Lord the Minister who is to reply to the debate this question: is that the policy of the Government? Does that quotation from the committee's report fairly represent the present policy of the Government?
Then there is the method of allocation. It was encouraging to read on 8th October, in newspaper reports of the Commission's annual report on the regional fund, that 10 EC countries, including the United Kingdom, received more than 95 per cent. of the grants last year. Allocations are being increasingly concentrated in the poorest regions of the Community and that is very good news. I should like to ask whether the Government are confident that the sort of distribution which the figures reveal for 1983 will be maintained under the new regulation? Is that the Government's view and expectation?
However, nine-tenths of the money distributed in 1983 went to infrastructure projects. The committee's report points out that there is a serious imbalance between infrastructure and industrial projects, which these recent figures confirm. Administrative problems, delays and the lack of additionality are no doubt among the reasons for this. Can the noble Lord say, when replying, what the Government feel about this and how they think the problem should be tackled?
Fourthly, there is the question of access to the Community. In all the debates which we have had so far I have expressed concern, as have other noble Lords, about the participation of local authorities and regional agencies in the preparation of projects and programmes. The report has much to say about that. It says that in the United Kingdom local authorities are kept firmly in a subordinate role. The report speaks about insufficient liaison between central Government and local government. It also states:
"More effective regional machinery. especially in England, would enable the more disadvantaged regions to respond more rapidly to the European Regional Development Fund's call for programmes."
Again, it states:
"There are major gaps in the machinery of regional administration in the United Kingdom which must be rectified if the programme approach is to have a wide and successful application."
Finally. the report states:
"Greater use should be made of the regional development agencies in the administration of the European Regional Development Fund in the United Kingdom."
It is clear that there is a serious problem here and that we have not satisfactorily worked out in this country the method of involving the regions in the preparation of projects and programmes. I should welcome a comment from the Minister on that. It will be
156
interesting to learn the Government's view of how the situation can be improved.
Of course, all the other large member states have elected regional authorities as well as regional administrative machinery. The United Kingdom has no elected regional authorities and its regional machinery has been reduced. The importance of the regions to the development of the Community cannot be over-emphasised. We on these Benches believe that elected regional government in this country could ensure, among many other benefits, that the best possible use is made of the regional fund.
Finally, I come to the need for a comprehensive and significant overall regional policy for the Community. The European Regional Development Fund is one arm of Community regional policy but is there yet an overall policy embracing all the arms of EC policy, including the CAP? I am not clear that there is, and I should like to ask the Minister to say whether he has discerned such a policy, and what the Government are doing to promote such a policy.
I would say in conclusion that within such a policy a vital role could be played by a larger European Regional Development Fund, providing genuinely additional resources in close association with regional authorities, working within nationally agreed guidelines. I believe that we must do all that we can to move things in that direction.
4.30 p.m.
Lord Bancroft: My Lords, much of what I wanted to say has already been said by the noble Lord, Lord O'Brien, with lapidary precision. He guided the subcommittee with the same deftness during our deliberations. During his remarks he defined the policy which the ERDF is there to serve:
"to aid the improvement of economic performance in the poorer regions of the Community, with particular emphasis on job creation".
At the end of its fourth examination of regional policy, the committee concluded, rightly or wrongly—I think rightly—that this definition remains valid, both despite and because of the changes which have taken place during the past eight years. But the committee also felt that both the fund and the policy which it serves need regular examination, not least because both have their critics.
There are those who are opposed in principle to Community regional aid in its present form. We have heard from the noble Baroness, Lady Carnegy, a reasoned statement of that case, put forward with spirit and vigour. That view I respect and understand. There are also those, who have not as yet had a voice in this House, who oppose national regional aid. That view I neither understand nor agree with. In that context a totally untrammelled market place and market forces seem to me neither surrogates nor substitutes for common sense.
The energising forces of the market—and they are energising—need to be adjusted at the margins: encouraged here a bit, restrained there a bit. Regional policy, after all, is only one small component of the total adjustment process, which includes fiscal policy, public expenditure policy, employment policy and

157
physical planning policy—a whole range of policies of different sorts.
In truth, as the noble Lord, Lord O'Brien, said, regional aid represents only a small charge on the Community budget—between 5 per cent. and 8 per cent., as compared with about 65 per cent. for the common agricultural policy. It is therefore a modest piece of Community policy, with perhaps rather too much of it to be modest about. National regional aid, as has been said, is of course much bigger, but it is still marginal in terms of gross domestic product and total public expenditure.
So far as Community policy is concerned—and so long as there is an ERDF—I think most of us would agree that we owe it to our deprived regions to secure for them a share of the development fund. We have contributed to it; they have contributed to it. There is no charity involved. It should be, but, alas, too often is not, an investment vehicle. I repeat that our objective ought to be to use it sensibly and, where at all possible, profitably for our poorer areas. I think that the record of successive British Governments in achieving that objective has on the whole not been a bad one, though there is room for improvement—but, after all, there always is.
How can we best continue to pursue that objective? I ask the question on the assumption that we are not suddenly going to turn our backs on the concept of regional policy and a European regional development fund—we are not going to turn our backs on it either out of settled conviction or in pursuit of an ideological whim.
The committee's report makes a number of suggestions on that point, and I intend to pursue just two of them. To a certain extent I shall be a bit repetitive but I hope not too much. By way of preface, I observe, as previous speakers have done, that any national government can if it wishes (and most of them, alas, do) frustrate much of the policy and its instrument by a simple device—that is, to dock national aid to its regions by the amount that it receives from a fund. We then have no additionality. The fund's support for that country thus becomes a very cumbrous way of shovelling negative amounts of money (if I may use that curious term) across the frontiers of Europe.
My two points are these. First, following the noble Lord, Lord Banks, I ask whether the balance between infrastructure and industrial development is right. I suppose that one answer is that they both form part of a continuum and that it is rather profitless to talk about rightness in that context. But, as the noble Lord observed, it is interesting that in the last three years almost 90 per cent. of the fund Community-wide has gone on infrastructure projects. So far as the United Kingdom is concerned—and this time taking an eight-year period—about 30 per cent. of the projects financed from the fund's quota section were industrial and 70 per cent. infrastructure. This 30/70 split compares with a West German split of 60/40 over the same period, but I think that it is generally agreed that the German trend is, in gardening terms, a sport. The Community-wide bias, Germany excepted, in favour of infrastructure is partly—perhaps mainly—a
158
reflection of the fact that private industry does not want to invest in the poorer regions.
As the noble Baroness implied, unless governments, and the Commission, are prepared to face that issue, the basic policy underpinning the fund will remain faintly unreal. There are two extreme scenarios: on the one hand, cutting losses in these regions and moving people out of them into jobs; on the other, moving productive jobs to people in the deprived regions. In practice, as we know, a mix of both is bound to be involved. But what seems to be a doubtful course is to pour investment into the infrastructure and then simply hold one's thumbs and hope that that in itself will attract enough industrial investment. It does not always happen, as the under-used trunk road network in North-West and North-East England demonstrates. In short, incentives for private productive industry in the deprived regions remain an essential element.
This leads me to my second and last point. It is the case that structure, organisation, administration, management, call it what you will, is the servant of policy. It is not a policy end in itself. It should be made, however, to serve the ends of policy efficiently. I think that all of us would agree with that. As already noted by earlier speakers, there is room for the organisation both of the Commission and of the Council of Ministers to be tilted a bit more in the direction of purposeful decision-making and action-taking. The fact that regional development policy, with its industrial and employment detail and importance, and its funding, should be dealt with by the Council of Foreign Ministers has really a touch of Ruritania about it. But it is, in fact, deadly serious. There ought, surely, as the noble Lord, Lord O'Brien, pointed out, to be a forum for the more relevant Ministers to meet, discuss, decide and act.
In the case of England, the report comments not unkindly that
"regional planning appears to be undertaken at present in a vacuum".
This is at a time when, and I quote the report again:
"Community pressures are now pointing Member States in the direction of regional planning".
The report notes that it was the Commission that indicated that there were major gaps in member states' own regional incentive schemes regarding the development and application of innovation in small firms. No one, least of all myself, wants to see more layers of expensive officialdom. But so long as we have an ERDF, I think that there is a case for making what exists, or used to exist, work a bit better. I note without comment the abolition of the regional economic planning councils, themselves an unpaid system of decentralised consultation. I note, too, the resulting attenuation in the roles of the regional economic planning boards.
I think that I am probably the last Member of this House to believe that deep-seated problems can be solved by some artful juggling of the machinery of government. I doubt, for example, whether any form of physical activity was materially assisted by the creation of the office of Minister for Sport and Children's Play. None the less, I do commend to your Lordships the report's suggestion that a single Minister and department should be designated to take the

159
lead—not to take the sole responsibility, but to take the lead—in handling regional policy.
I conclude by saying that much has happened to the machinery of government—perhaps, indeed, too much—since the 1970 White Paper on the reorganisation of central government. This stated that the Department of the Environment would have the leading responsibility for regional policy but that the Department of Trade and Industry would retain responsibility for certain economic aspects including industrial development in the regions. That was a bit of a fudge. And, despite all that has been done, said and written, some of it very recently, on the subject, it does remain a bit of a fudge still on the ground. It has not helped in the formation of a coherent regional policy. I fancy that the unemployed men and women in Skinningrove and Millom do not really spend their evenings discussing nice points about the machinery of government. But they do care about the effects that it has on the prosperity of their region.
4.44 p.m.
Lord Tranmire: My Lords, the noble Lord, Lord O'Brien, has, with great clarity, exposed the problems covered by this report. Those of us who served on the sub-committee I know would wish me to pay tribute to the unfailing courtesy and the penetrating wisdom that he used when he occupied the chair. Having been over this course four times, I have come to know some of the fences, particularly the rather awesome water jump, "Additionality". It has perhaps left me, rather like my noble friend Lady Carnegy, with some misgivings about the European Regional Development Fund. Coming straight to the water jump, the principle of "additionality" was meant as a safeguard against reimbursement of national budgetary expenditure. It is quite incapable of proof and may be inclined in fact to encourage evasive tactics in certain of the member states.
The noble Lord, Lord Bancroft, talked about the division between infrastructure and industrial problems. It is not surprising that there has been a great decline in the number of applications for industrial grant in all countries of the Community when you realise that a successful applicant never handles the grant. It is quite immaterial to him whether the application succeeds or is rejected, except that if it succeeds he probably gets rather more involved in bureaucracy than he does otherwise. Even in the case of the infrastructure investment application, the only advantage really that the successful applicant gets is that he will have his loan charges somewhat reduced. I do not know what the solution is. I do not attempt to offer a solution. But it is I think an inherent defect of the ERDF.
What is clear, as I think all speakers have agreed, is that today the need for help towards regional development is more pressing than ever. Although the ERDF budget, as the noble Lord, Lord O'Brien, has pointed out, has increased sevenfold since its inception, regional disparities are more wide today than they were in 1975. Rising unemployment throughout the Community and prospect of the results of enlargement have aggravated and changed the nature of the problem. Notwithstanding these facts, Mr. Mathijsen,
160
the director general responsible for the Regional Development Fund, told the Committee in evidence:
"Maybe regional policy as such does not exist. It is rather regional politics that exist".
He described the regional fund as just an instrument towards a policy.
I am afraid that I keep on having to repeat what the noble Lord, Lord O'Brien, has said because he has covered the report so well. Although there are at Brussels a Council for Social Policy, a Council for Agriculture, a Council for Industry, a Council for Finance and a Council for Economics, there is no Council for Regional Policy. The regional fund is to a certain extent circumscribed by each Government's decision in declaring an area to be an assisted area even though, as a consequence of that, areas denied assisted area status may be in greater need of regional help than areas in other member states that are receiving grants.
A further weakness I believe is where industrial problems are closely linked with the agricultural problems in less favoured areas. While the former are assisted by the European Regional Development Fund, with all the limitations that noble Lords have outlined, the latter are more generously provided for by the Agricultural Guidance Fund. On enlargement, this will become even more evident. Already it has led the Commission to create an integrated development programme for the Mediterranean countries. The Court of Auditors, in their last report, criticised the vagueness of the screening by the Commission for some of the project's finance.
How far can Britain's regional policies be solved by an integrated development programme? We really have only the example of the Belfast integrated programme to guide us. This has been extremely slow in producing results, leading to the suspicion that the Community's administrative machine is not geared for such programmes and that the Regional Development Fund has not sufficient staff to oversee them. That was admitted by the director-general in charge of regional policy.
Although we should beware of creating more bureaucratic log-jams at Brussels, the solution may possibly be—I suggest—to hive off the European Agricultural Guidance Fund from the Council of Agriculture and attach it to a new Council for Regional Policy, so that the problems of industry and the less favoured areas may be together under one council at Brussels. This development, I believe, might encourage the richer countries of the Community to take more interest in, and to be more generous to, the European Regional Development Fund.
In conclusion, I wish to stress that while the new regulation represents a substantial advance upon its predecessors, the Regional Development Fund could be doing far more to rectify disparities throughout the Community. Its future success will depend on the progress it makes with integrated development operations and how far these can raise the standard of living in areas of industrial decline, in travel-to-work areas and in agricultural, less-favoured areas. It would appear that the Commission has at present inadequate staff to tackle these problems and has not the overall policy required for this purpose. I believe that it is in

161
the interests of the Community that further thought should be given to devoting more of its initiative and resources to reducing the disparities throughout the enlarged Community.
4.53 p.m.
Lord Ezra: My Lords, I should like to intervene very briefly in this debate, so ably introduced by the noble Lord, Lord O'Brien. I wish to make only one point. That point is to remind ourselves that the Community's regional development policy can form only one part of a wider-ranging initiative which is now required to address itself to the basic economic, industrial and social problems facing the Community as a whole.
As my noble friend Lord Banks made clear, the Regional Development Fund is in itself now totally inadequate to achieve the objective for which it was initially proposed. Less than I per cent. of the Community's overall GDP is clearly not going to be sufficient to deal with the massive regional disparities which exist within the Community. This limited fund has itself been further weakened by the lack of the application of additionality, as many noble Lords have made clear.
But, of course, since the fund was introduced in its present form in 1975, and subsequently revised, a lot has happened in the world, as the report itself makes clear. It would seem to me that, now that the major budgetary problems have been overcome, the next biggest question to which the Community should be addressing itself is the whole problem of how we try to deal with the basic economic difficulties within the Community. It might well be that as a result of such a review a much larger Regional Development Fund, under new principles and new guidelines, would be required. Therefore, although that fund and its allocation have recently been reviewed, I should like to suggest that the time might well be near when we should be looking at this whole question on a much wider basis.
4.56 p.m.
Lord Taylor of Gryfe: My Lords, tribute has already been paid by other speakers to the reasoned way in which this report has been introduced by the noble Lord, Lord O'Brien of Lothbury. I should like to add my tribute to his conduct as chairman of this committee. This is the second report with which I have been privileged to be associated under his chairmanship. While we spend long hours listening to witnesses and reading evidence in the room upstairs, one must occasionally ask oneself whether it is worthwhile. I hope the speeches that have been made this afternoon will continue the process begun by an earlier report—a complicated report on membership of the European Monetary Fund—which seemed to revive a general interest in that matter. I hope that the noble Lord, Lord O'Brien, and his colleagues will feel encouraged to use their talents, their probing, their objectivity in the interests of this House and the production of reports similar to the one that is before us this afternoon.
162
As has been pointed out by the noble Lord, Lord Bruce of Donington, this is regional policy day in the House of Lords. We have already passed the Cooperative Development Agency and Industrial Development Bill, which provides for the restructuring of regional assistance. A White Paper already exists and the map of the restructuring of regional assistance is promised and I welcome very much the assurance of the noble Lord, Lord Lucas of Chilworth, that that will be the subject of debate, because some of us have a great deal to say about it even if I cannot match the eloquence of the noble Lord, Lord Bruce of Donington.
The question of regional aid, with which this report is associated, is of great importance. Anyone who, like the noble Baroness, Lady Carnegy of Lour, and me, lives in Scotland, will appreciate how significant is the application of regional aid in the reconstruction of the devastated areas of the Scottish economy. One thinks of firms like Motoralo, East Kilbride, National Semiconductor at Greenock, IBM, Hoffman Laroche in Dairy. Eighty per cent. of UK production of intergrated circuits now takes place in Scotland. This does not happen by accident, and questionnaires sent to the firms concerned, which have expanded their investment in Scotland, confirm that regional assistance is a very important factor in making these decisions.
Yet many of us, not only in Scotland but in other parts of the country represented in this House, are increasingly apprehensive about the Government's intentions as regards regional aid. I refer to the report of the committee on the Industrial Development Act which has just been published, of which my late colleague and good friend Bill Mackworth Young was chairman. The report points out that from the quality of the cases which it considered:
"the board remains of the view that selective financial assistance has a vital role to play in developing the industrial strength of the United Kingdom, particularly so in the new high technology areas".
Yet the report contains some interesting facts. For example, automatic grants to special development areas and to development areas dropped by more than a third to £438 million in the year to 31st March 1984 compared with £689 million in the previous year.
So the cut in regional assistance is already being imposed. What is particularly significant for people who live in Scotland and who have benefited from regional aid is that the highest fall affected Scotland and payments fell by half to £142 million compared with £287 million in the previous year. As the Financial Times said when referring to this report:
"These figures will make especially grim reading".
We are in a situation where regional aid can make an important contribution to restructuring industry and creating economic growth. These cuts have already been imposed and a few more are no doubt promised in the redrawing of the map which will shortly come before us.
In Europe, just as in the United Kingdom, there can be no sense of community if there is a wide divergence in standards of living. If we have an increasing disparity in the standards of living and the state of economic well-being in the constituent parts of Europe we shall never develop a strong sense of community. I

163
as a pro-European and the Alliance Benches—who are committed to Europe even if occasionally it is unpopular—believe strongly in the strengthening of the European Community, and we wish to support any efforts which will prevent the regional disparities from widening. In our own life, in our own country and in our own cities we know that the division between rich and poor is the most destructive element in the establishment of happy communites.
As has been said by other speakers, there is a total inadequacy in the £1 billion which is spent under the fund on projects throughout the Community. As has been said in the report at paragraph 84:
"Member States' own regional spending account for at least ten times and sometimes up to 50 times this amount".
Nevertheless, although the ERDF contribution is limited in the total picture of regional aid, at the same time it is an important gesture, it is an important symbol of European interest in this important area. I always hoped that the lobby of the unemployed in Europe might be almost as powerful as the lobby of the French farmers.
It is very disappointing when we look at United Kingdom regional policy to find that in paragraph 93 dealing with the subject of additionality, which has been much aired this afternoon, the report says:
"evidence from the Department of Trade and Industry, is not encouraging, since it seems that the United Kingdom is expecting the ERDF to pay in future for a higher share (in money terms) of a much reduced national regional aid scheme".
So the Government are practising something of a sleight of hand hoping to attract more money from the European fund and at the same time cutting drastically the aid from the Exchequer.
I was particularly interested in the evidence that was received from the local authorities during the Committee's consideration of this matter. The Strathclyde Region and other regional authorities made it abundantly clear that so long as the fund is centrally administered the whole thing looks like a handout from Whitehall, and the sense of European involvement in assisting regional development is not fully realised. That is not helpful to those of us who are anxious to develop the European idea, and the importance of Europe in providing regional aid is frequently not recognised.
May I also draw your Lordships' attention to paragraph 98. While we recognise that the present £1 billion spread over Europe is inadequate, we are shortly to be faced with the possible entry of Spain and Portugal who will also be claimants on the fund, and we shall never be able to discharge our Community responsibilities unless there is a substantial increase to take care of the new members.
I hope that the noble Lord, Lord O'Brien of Lothbury, will not feel that his labours have been in vain in producing this excellent report. I can only hope that the Government in replying to this debate will give assurances that this is a matter of high priority. I hope that they will give certain assurances with regard to the promised new policy in support of regional aid. I hope they can assure us that it will not be a case of depending to a much greater extent on European aid in order to get the Exchequer off the hook.
5.7 p.m.
Lord Bruce of Donington: My Lords, the Select Committee's Report on the European Development Fund, No. 274, is one of the most interesting reports that it has been my privilege to read since I have had the honour to be a Member of your Lordships' House. It has been most cogently put together. It is not only that the conclusions of the committee have commanded such support this afternoon; it is not only that the recommendations are important; but some of the evidence which has been given by officials of the departments concerned has been most illuminating and more informative than some ministerial utterances to which we have been privileged to listen from time to time. It is a report that should command the widest attention; and for my part I should like also to offer my congratulations to the noble Lord, Lord O'Brien of Lothbury, for the very calm and dispassionate way (I was almost going to say the unenthusiastic way) in which he introduced it.
Indeed, I think it is fair to say that the contributions that have come from all sides of the House this afternoon have cast a little doubt on the efficacy of the European Regional Development Fund. I believe that there is a little unease as regards its administration; and to say the least, there has certainly been a degree of unease about the way in which Her Majesty's Government have delt with the question of additionality. In fact, in expressing my own appreciation to the Select Committee and its members I am bound to say, somewhat uniquely for me, that I have found very little in any speech delivered by any Member of your Lordships' House this afternoon with which I can violently disagree.
I well recall when the European Regional Development Fund came into existence. If I may venture to remind your Lordships, it was the result of the Dublin re-negotiations which took place in 1974, which were a prelude to a referendum that was held in this country in 1975 as to whether or not we should remain in the European Community. I well recall the arguments that were adduced in those days concerning the strong desirability of this country for retaining its membership; and one of the reasons given for that was the vista that was held out to Europe, and particularly to the United Kingdom, of what the establishment of the European Regional Development Fund would do. A new directorate was created. We were assured that it would develop into an instrument that would powerfully assist in the vast discrepancies of resources of fortune that existed throughout Europe and, indeed, in this country.
What has happened in the event? The point was made very well by the noble Lord, Lord Tranmire, I thought—and it is undoubtedly true, and is in the report—that despite this the richer areas of Europe have become richer and the poorer areas have become poorer. There is now no doubt about that at all. It is within the context of that undoubted fact that we have to consider this report and the suggestions that it makes.
The Members of your Lordships' House who were members of the Select Committee were at one that the funds at the disposal of the European Regional Development Fund should be substantially increased

165
in exactly the same way as that renowned firm of accountants who investigated the operation of the regional policy in the North-East recommended that the state contribution in this country ought to be doubled from £600 million to £1,200 million. The noble Lord the Minister will recall the report because I referred to it in an earlier contribution that I was privileged to make in another debate.
What are the possibilities? As a former member of the European Parliament, as one who was interested in budgetary matters and who for a little time was the president of the European Parliament's regional committee, I shall recount to your Lordships exactly what happens. In the preliminary draft budget as submitted to the European Parliament the Commission includes certain suggestions as to the total amount of payments into the Regional Development Fund during the year. It does this in two ways. It lays down the figures which it thinks the payments should be limited to, and, on top of that and absorbing them, what commitments should be allowed to be entered into in regard to the regional fund. The preliminary draft budget is then considered by the Parliament, by its regional affairs committee and by the Parliament's budgetary committee, which invariably add a very significant sum to that suggested by the Commission. Amendments are put down and are ultimately passed, and the preliminary draft budget as amended by Parliament goes to the Council of Ministers.
There is one thing of which we can be dead certain—and this has applied right from the beginning, and still applies. Any significant increase in the Regional Development Fund or, for that matter, the Social Fund is invariably turned down by the Council of Ministers, on which our own Government are fully represented, because, of course, as many noble Lords have pointed out this afternoon, agricultural expenditure (which is sacrosanct, which is completely out of control and which, in point of fact, is demand-led) invariably squashes everything else out of the budget. The draft budget is returned from the Council of Ministers to Parliament with possibly a token increase over the original suggestion for regional aid, but certainly it does not concede power.
I have been present at numerous conciliation proceedings between the Council of Ministers and the European Parliament in which our own representatives, including those of a previous Administration—I want to be quite fair to the noble Lord the Minister—have invariably resisted any significant increases in this fund. I venture to suggest that the prospects of increasing it this time are fairly remote.
One other matter has to be borne in mind. It is alleged that the application of the Regional Development Fund, even at its reduced level and even at a level which is inadequate, is some heaven-sent benefit conferred by the European Community on the places which ultimately benefit from grants from the fund. The noble Lord, Lord Taylor of Gryfe, touched upon this indirectly when he referred to the question of additionality. But there is an additional factor, because in the course of evidence that was given by Mr. Walmsley at page 15 of the report he said:
"we already contribute 22 per cent of the 24 per cent we take out [of the European Development Fund]".
166
It is all very well to say that we have had this contribution to this or that part of Scotland or Wales and notices are required to be displayed saying, "This development is with the aid of the European Community", and so on. In point of fact we contribute 22 per cent. of the fund and take out 24 per cent., and the benefit to the United Kingdom is exactly 2 per cent., which is a fact that is not generally recognised. Indeed, miniscule though it may be—and the profit is £25 million in all—it is the one profitable item to be offset against these thousands or millions of pounds that go directly from the United Kingdom taxpayers' pockets into the agricultural fund for the subsidisation not only of our own farmers but of others. Those are the facts.
Therefore, after a lapse of nine years from its establishment one cannot wonder why a sign of disillusionment, however politely expressed, begins to creep in as to the effectiveness of this part of the EEC. Added to that there is the question of additionality. The committee expressed itself temperately on this matter, but on going through the evidence upon which it based its judgment—and I have been all through every bit of the evidence incorporated in the report—there can be no doubt whatsoever that the United Kingdom, before it determines what it is itself going to spend in connection with the distressed, the special development and the development areas of this country, should take into account what it expects to get out of the Regional Development Fund. There is abundant evidence of it. And yet when they speak in the Council of Ministers and elsewhere they pay tribute to the whole question of additionality.
On financial grounds one of course cannot complain, because it saves money. It saves a contribution, or part thereof, into the European Community itself. But for any Government really concerned with bringing aid to the distressed areas of this country—and there are now hundreds with unemployment going above the average of 12 per cent.—to avoid additionality by what amounts to, in Community terms, a subterfuge is not something for which it should take great credit.
I found myself in considerable agreement with the noble Baroness, Lady Carnegy of Lour, in what she said. What she said is true: applications go in for regional aid; they are vetted by the government department; they then go up to the Commission itself—DG 16, I think it is—and they are considered there. Then, once every three months there is a management committee composed of representatives of all the nations. Usually they are ambassadors, or people who are appointed by the ambassadors, who solemnly get round the table and determine the carve-up. After that projects are approved, and they come back. I agree with the noble Baroness that all this, going right the way through channels up and down again, must be costly. It may satisfy those who desire, or who have any lingering desire, to preserve the reputation of the Community as an institution, as a mere fig leaf to show the world that it is useful, but in financial terms it is not very productive.
One of the most remarkable things is the extent to which local authorities themselves are involved. With the permission of your Lordships I shall give a quotation from the report which indicates the

167
ambivalence of the Government in this matter. At page 8 of the evidence your Lordships will find that my noble friend Lady Llewelyn-Davies of Hastoe asked Mr. Walmsley, of the Department of Trade and Industry, the following question:
"When you apply for grant do you have to have local authority support for your project to begin with or can you apply without that?"
That seems to be a question which should be capable of an immediate and direct answer. But the reply given by Mr. Walmsley, I think your Lordships will find, was slightly reminiscent of the style adopted in, "Yes, Minister". Mr. Walmsley did not reply whether the local authority came into the picture or not. These are the words he used:
"In the case of infrastructure projects, the only projects which are eligible are those which are financed by the public sector in one form or another".
This was the way in which the direct question of my noble friend was answered. Whereas, of course, we all know perfectly well, and it is made clear in the evidence—and this was touched upon by the noble Lord, Lord Banks, and the noble Lord, Lord Taylor of Gryfe, and indeed by other noble Lords—that the local authorities are virtually excluded from any creative participation in the ERDF or, for that matter, in the development of regional policy.
There are emphatic statements in the report to that effect. This is not surprising when one considers the remarks made by Professor Goddard, who gave evidence before the committee on the state of regional planning. The committee itself arrived at the conclusion that regional planning in England appears to be undertaken at present in a vacuum. At page 36 of the evidence, in reply to a question by the noble Lord, Lord Croham, Professor Goddard, of the University of Newcastle-upon-Tyne, said this:
"The problem is that at the present time we do not have a machinery for regional economic development planning in the United Kingdom and it might be quite difficult to prepare those sorts of programmes because we have put the machinery on one side for the time being".
I am merely quoting from the report, but if anything that the report has said is inaccurate then I shall be glad if the noble Lord would correct me. If the report is incorrect in saying that there is no machinery for regional economic planning, then, if there is, perhaps the noble Lord will tell us what it is. If there is not, it of course explains the strange reluctance to which I referred in a previous debate to set out any future plans for what regional development is going to be in this country.
I regrettably have to agree with the sentiment expressed, I thought somewhat wistfully, by the noble Lord, Lord Taylor of Gryfe, when he inferred that the Regional Development Fund is rather more of a symbol than anything else of the existence of the Community at this time in any fields outside the CAP. Surely, has not the time come when we ought to admit that the emperor has no clothes, and when to these peripheral activities (including the European Regional Development Fund), however much we ought to support them—and I agree this on the basis of getting as much as we can for our own country, ourselves being a net contributor to the Community—we ought
168
to give such support with our eyes wide open, and not place any great hopes upon their future development?
I invite those noble Lords who have not done so to read through this document—which, I repeat, is a good and informative document. I sincerely hope they will. I am quite sure that when they have done so they will come to the conclusion that the Select Committee have done a very good job indeed, and that the contributions made in your Lordships' House this afternoon have been well worth while and are a tribute to it.
5.29 p.m.
Lord Lucas of Chilworth: My Lords, may I begin by congratulating the noble Lord, Lord O'Brien, and indeed the Select Committee as a whole on the wealth of information they have managed to pack into what is, as the noble Lord, Lord Bruce of Donington has said, a most interesting and informative report. At this time perhaps I may also thank all noble Lords who have taken part in the debate this afternoon, which has made it most interesting.
As we are about to enter a new phase of the fund's activities this is a good moment to take stock. I deal first with the general but important question of enlargement of the Community, which has been touched upon by one or two noble Lords.
Although recommending a proportional increase in ERDF resources on the entry of Spain and Portugal, the Committee quite properly related this to future development of the overall budgetary resources of the Community. This is also the Government's position. The Government welcome the forthcoming accession of Spain and Portugal to the Community, which we believe is in the interest of all member states.
The fund's declared aim under the old 1975 regulation was to "correct the principal imbalances within the Community." The new regulation rather more sensibly moderates this to contributing to the correction of these imbalances. For as the Committee have pointed out in paragraph 84—and I believe that the noble Lord, Lord Banks, made this point—member states' own regional spending is very much larger than spending by the ERDF. This will continue to be so. It is sensible that the principal role of the ERDF should continue to be to contribute to and support member states' own regional policies.
As regards the future under the new regulation, which was adopted on 19th June 1984, from the Commission's first proposals in 1981 through to the amended proposals of last year, the United Kingdom has pressed for early agreement of a new regulation in pursuit of its belief that the ERDF should continue to develop, with the conviction that every opportunity should be taken to improve the efficiency and effectiveness of the fund's operations. I am glad to note that the weight of the evidence recieved by the committee has led them in their own report—and this is also true of the weight of comment by nearly every noble Lord who has contributed this afternoon—to welcome the new regulation. This is also the Governments' view, and our aim is to make the new regulation work and to work well.
It was perhaps disappointing for both the Government and the Commission that it did not prove possible to reach complete agreement between member states on the Commission's original 1981

169
proposals. It is perhaps not surprising that new proposals for allocating resources should have given rise to difficulties, particularly when they would have meant that most member states would have received little or nothing. The Committee has, in fact, noted that there may be important political advantages in allowing every member state to have a share of the fund and there is something to be said for that view. I note the distinction that my noble friend Lady Carnegy made in this respect.
The noble Lord, Lord Bruce of Donington, made some comment with regard to the United Kingdom's input and net receipts. It is difficult totally to foresee how the new system will operate in practice. What is clear is that the United Kingdom can now aspire to 28.56 per cent. of the fund by comparison with our previous 23.8 per cent. The House may be sure that the Government will be pressing very hard indeed for such a share. Whether we can achieve this will depend on a variety of circumstances, many of which are outside our control, and not least the bids submitted by other member states and the extent to which we may or may not benefit from any Community programmes proposed by the Commission.
The other big changes have been in the operation of the fund. All member states want improved efficiency in the operation of the fund. We therefore attach considerable importance to the provisions in the new regulation for the financing of programmes rather than a multiplicity of individual projects. We are now considering, with the Commission, how to make best use of these new arrangements.
In the case of Community programmes, the Commission must first make a framework proposal to the Council, which the Council may then adopt by qualified majority—so here there will be no question of a one-state veto. The detail of the Community programmes would be settled in the same way as that of national programmes—by the member states concerned and the Commission, in consultation with the fund management committee. However, there is one important and reasonable qualification: a Community programme could not be approved without the agreement of a member state in whose territory it would apply. I think that is only right. That is set down in Article 7, Section 2.
My noble friend Lord Tranmire, among others, spoke upon the subject of Community procedures. I note particularly the Select Committee's proposal that regional policy should be dealt with by a specific Council of Ministers rather than by the Foreign Affairs Council. That is in paragraph 98 of the report. There may have been an argument for this when the ERDF regulation was under review, though not necessarily, I would suggest, a convincing argument. Now, however, that the new regulation has been settled, the Government do not believe there would be sufficient ministerial work to warrant setting up a separate council. The Government will not therefore be pursuing this proposal for the time being. However we recognise the case for ad hoc meetings of Ministers particularly responsible for regional policy.
The noble Lord, Lord Bancroft, asked about who might take the overall lead. I noted that the committee recommends that for England there should be a
170
leading Minister and department to handle regional policy. How one reads that recommendation is, I think, open to question, because I believe that the recommendation itself has arisen from a misunderstanding. My right honourable friend the Secretary of State for Trade and Industry has overall responsibility for regional policy for all the United Kingdom, but this should not obscure the fact that he is also the Minister who takes the overall lead for regional policy questions in England.
Of course, my right honourable friend does not work in isolation. The Secretary of State's White Paper on Regional Industrial Development, dealing with the review of regional industrial policy, referred to the need to take account of the regional dimensions in a wide range of central and local government policies, and to the close working relationship between the Department of Trade and Industry and other departments. Decisions are always taken in close consultation with all interested departments of state. The valuable and essential contributions made particularly by the Scottish, the Welsh and the Northern Ireland departments and by, among others, the Departments of the Environment, Energy and Transport are all taken into account.
The committee's report refers to "gaps in the machinery of regional administration" and to the Government's reappraisal of regional planning in 1979. I would remind the House that the regional planning at that time was primarily concerned with the use of land. At no time were the tripartite regional planning strategies or the appointed regional economic planning councils capable of directing the scale and location of capital investment undertaken by the public authorities charged with providing infrastructure services, still less the commercial and industrial developments undertaken by the private sector.
The committee also raised the important question of the link between United Kingdom regional policy and eligibility for ERDF assistance. This was in paragraph 97. The report suggests that the Government's regional industrial development White Paper raised doubts about the future direction of United Kingdom regional policy in this country and in particular whether there will be a sufficient number of projects and sufficiently wide coverage by assisted area or other status to provide an adequate number of industrial and service projects. The White Paper clearly spelt out the Government's firm commitment to an effective domestic regional policy. We discussed this earlier this afternoon and indeed last week and I think therefore that it would not be helpful if I returned to the arguments that I deployed earlier.
Perhaps I may turn to some of the more general points which were made during the course of our interesting debate and to one about which without exception—unless perhaps it was the noble Lord, Lord Ezra, in his brief intervention—all noble Lords spoke. That is the question of additionality. This, I believe, is an issue which, again, is often the subject of misunderstanding. The principle that it expressses is that grants should not lead to reduction in national expenditure. The report suggests in paragraph 79 that the supposed lack of additionality may discourage

171
local authorities from making application to the ERDF.
The simple fact is that this additionality can only be provided for at the level of overall public expenditure planning; and that is exactly what we do. The Government plan their expenditure on the basis that a certain level of ERDF receipts will be forthcoming; with the result that the total level of expenditure—and this is important—is higher than it would be without those receipts. The total number of projects which can be implemented is obviously greater. Quite contrary to what the Committee has implied, this practice has by no means discouraged local authorities from applying for support for their projects. Quite the reverse! They fall over themselves to secure assisted-area status and the coveted ERDF eligibility; because by this means they are able to undertake more, and perhaps even more expensive, projects.
The Committee's report also suggested in paragraph 80 that greater visibility in relation to ERDF receipts in the national accounts of member states would be an advance. So far as the United Kingdom is concerned, the public expenditure White Paper already shows the expected amount of ERDF receipts alongside the planned levels of domestic expenditure under the same headings; and separate ERDF figures are also given in the supply estimates and the appropriation accounts. My noble friend Lady Carnegy of Lour spoke about the administrative costs of the operation of ERDF. Regrettably, the administrative costs in any system of regional aid are fairly high. We recognise this and this is why the Government hope to make good use of the new provisions that there are for the national programmes.
The noble Lord, Lord O'Brien, in his speech and I think also the noble Lord, Lord Banks, in his, spoke about the need for the creation of permanent employment. The committee recommended that more attention should be given to the creation of this, particularly with the help of ERDF. So far as we are concerned, I remind noble Lords that the Government made clear in the White Paper on regional industrial development that their own view is that it is essential to ensure that regional policies are effective in creating genuine jobs. Again, we discussed that earlier this afternoon. Both the noble Lord, Lord O'Brien, and Lord Banks, spoke about the development agencies. I noted what they had to say about development agencies to cover the whole country.
But, with respect, regional policy is about a part of the country rather than about the whole. It is true that there are no agencies in England that are comparable with the Scottish and the Welsh Development Agencies; but, through the activities that are carried on through the regional offices and the discussions that take place with local authorities, we feel that although the package may be a different shape, the contents are essentially the same. Much was said by a number of noble Lords, notably, I think, by the noble Lord, Lord Bancroft, about the industry infrastructure balance. This was a point that the committee noted. This imbalance to which he referred is quite simply because the Community's economic situation, coupled with the large growth of the fund and its restrictive rules, has made it impossible for most member states to
172
maintain the 70/30 infrastructure industry balance which was provided for in the old regulations. Last year it would have been quite impossible for the Commission to have used all the available resources of the fund if the Council had not waived that provision. The new regulation sensibly provides that member states and the Commission should merely try to allocate at least 30 per cent. of the fund to industry projects. I appreciate that the noble Lord, Lord Bancroft, made a comparison between the United Kingdom and Germany. The fact is that there have not been enough industrial applications coming forward that, even had they been accepted, would have brought our 70/30 balance more into line with what I believe the noble Lord sees as the more ideal situation which obtains in Germany.
The noble Lord, Lord Ezra, said that ERDF resources should be expanded proportionately on the entry of Spain and Portugal. I suppose that that is a fair comment and I suppose that when any grant or fund is set up there are those who say for a variety of reasons that there should be more spent or that it should be expanded. I think that we have to accept that, in considering the ERDF budget more broadly, it is noteworthy that the fund has grown since its inception in 1975, when expenditure was £125 million, to £1,220 million or so this year. The fund, I believe, is unlikely to grow at the same rate in coming years but the United Kingdom firmly supports the conclusion of the Brussels European Council that the financial resources allocated to aid from the fund should continue to increase in real terms, again within the limits of financing possibilities. I take much account of what was contained in the remarks of the noble Lord, Lord Bruce of Donington, on that subject.
A number of other interesting points arose. They were perhaps more expressions of view than questions addressed to me. I think that I have answered those that were specifically put in that spirit. Perhaps I may conclude therefore by saying that I thank the noble Lord, Lord O'Brien, and the Members of the select committee for their report. This afternoon has been most interesting and it has provided an opportunity to air really important matters. I hope that I have been able to make it clear that the Government are committed to maintaining an effective domestic regional policy. We are committed to a continuing effort to support and develop the work of the European Regional Development Fund, and we are committed to explore the new possibilities which will arise from the implementation of the new regulation.
5.50 p.m.
Lord O'Brien of Lothbury: My Lords, my first pleasant duty is to thank Her Majesty's Government for enabling this debate to take place this afternoon, and if I may say so at such a civilised hour. I should also like to thank all noble Lords who were good enough to take part in the debate both for their contributions and for the tributes that they have been good enough to pay to the Committee—and, indeed, to me. little though that was deserved. The noble Lord, Lord Bruce, said in the course of his remarks that he had agreed with all the speakers up to that point, and I began to wonder where we had gone wrong. But I came to the conclusion that there was one exception

173
even to the best of rules, and so I decided to press on. He said he thought that my introduction of the report was a little unenthusiastic. We all know that the noble Lord, Lord Bruce, is a passionate politician, and I suppose he is a stranger to the cool objectivity which is what I tried to use in my approach to this subject, and indeed so did the Committee as a whole.
Certainly I can say that we are not in any way unenthusiastic about the European Community idea. We are certainly not unethusiastic about the great desirability of minimising the disparity between regions in the Community—a formidable task at all times. We are not unenthusiastic about the ERDF as such, but we are very worried about the bureaucratic jungle in which it seems to operate in all countries, not least in this, and, as the noble Baroness, Lady Carnegy of Lour, said, the cost involved. Although I could be said to have been a bureaucrat all my life, I have an intense hatred of the creation of mountains of paper by bureaucrats when a straight forward approach to problems could solve them without all that trouble and expense.
We have also been greatly troubled by the lack of additionality, as indeed all speakers this afternoon have been; and despite what the noble Lord, Lord Lucas of Chilworth, has said. I think we shall remain troubled about that until we see evidence that it has changed. He says that the Government are not willing to set up a Minister in charge of regional affairs. I wonder really how strong the case is for not doing that. If we can have a Minister of Sport, surely regional affairs and the problems associated therewith are infinitely more important even than sport.
I was attracted by the proposal made by the noble Lord, Lord Tranmire, that the Agriculture Guidance Fund should be tied up with the Regional Development Fund in our consideration of the future financing of the Community and the place which the Common Agricultural Policy plays in it. We have been worried, as indeed everybody has, by the immense expenditure on the common agricultural policy, and the thought of how this might be minimised by giving help to those who are poor in agriculture, like the hill farmers, without giving blessings to the whole farming community—and excessive blessings in many cases. An idea of this sort might help in that direction. I also welcome the plea of the noble Lord, Lord Ezra, for a wider view on this question. It certainly should not be concentrated simply on the operation of the European Development Fund or indeed on the regional policies of individual countries. It is a Community problem of immense importance.
The part played by local authorities in this country was also discussed by the Minister and we heard a lot about it in the Committee, of course. The regional authorities do play a part: they do have contracts with Brussels and they value those contacts. It seems to me they could be used in a much more productive manner. I hope we shall see under the new regime which is now being established a greater Community element in the programmes. The Minister has said that if the Community has ideas of a regional policy, each country affected by that policy must agree with it. That is something which I believe is indispensable, but I hope our country in particular, and indeed all
174
European Countries, will approach this desire for a Community element in regional aid positvely and creatively. Again, I thank everybody for taking part in the debate, and the Minister for replying to it.
On Question, Motion agreed to.

Oil and Gas: Planning Control
5.54 p.m.
Lord Nugent of Guildford Lord Nugent of Guildford rose to ask Her Majesty's Government what are their intentions with regard to the draft Department of the Environment/Welsh Office Circular Planning Control over Oil and Gas Operations.
The noble Lord said: My Lords, I beg to ask the Unstarred Question standing in my name on the Order Paper. In August this year the Department of the Environment sent out to all local authorities and other interested bodies an advance circular of new guidance lines on the granting of planning consent for the development of on-shore gas and oil in the United Kingdom. The theme of the circular is broadly to encourage the exploration of on-shore oil and gas and development where justified, with a slight bow to the conservation of the environment as being in the best interests of economic recovery, both nationally and internationally.
Although the circular is published by the Department of the Environment, its guidance on conservation of the environment falls far short of the strength to be expected from the Ministry which is specifically responsible for this. Indeed, I could say with Isaac, being beguiled by Jacob,
"The hands are the hands of Esau, but the voice is the voice of Jacob".
The hands are the hands of Department of the Environment but the voice is the voice of the Department of Energy. Towards the end of paragraph 11 of the circular comes this sentence:
"There is now a wide measure of agreement on all sides that it is feasible to draw up sensible planning policies to balance oil and gas exploration and the protection of the environment".
If my noble friend Lord Avon or indeed the Secretary of State for the Environment himself will visit the villages bordering on Surrey, West Sussex and Hampshire, where proposals to drill for oil and gas are now becoming public, he will hear a completely different version of the subject. This is an undeveloped—and I should declare an immediate personal interest because I live there—unspoilt rural area immediately beyond the outer boundary of the London Green Belt and indeed some of it was proposed for an extension of the Green Belt. Virtually all this area is classified as of great landscape value or as areas of outstanding natural beauty. Existing planning controls prohibit any development outside each village area and very tight control within it. Thus the local inhabitants are very conscious of their continuing responsibility for the protection of the beautiful environment in which they live.
I should also draw attention to the fact that the Surrey County Council's structure plan permits development outside villages only to meet needs of agriculture and forestry. So local inhabitants foresee that the drilling of exploration boreholes followed by

175
exploitation and production wells is going to change the character and amenity of their villages and the surrounding countryside for up to the next 25 years, and change it in a way which is far from pleasant. It would change from being unspoilt countryside to being spoilt countryside. Currently there is a planning application for drilling an exploration well at Dunsfold but it is opposed by the two parish councils of Dunsfold and Alfold and also by the rural district council's planning committee.
I come now to the precise nature of the damage to the environment which would follow exploitation and production. The boreholes are drilled by a derrick 128 feet high, working day and night, with a heavy noise factor. The estimated time for the exploration is given as only four to six weeks, but I did note that in the neighbouring village of Chiddingfold they took some 38 weeks. If oil is found it will probably take a few months to install the pumps and pipelines; and further disturbance would probably be small. If gas is found the production process is of a completely different nature. An industrial site of some eight to 10 acres is established at each find, equipped with pumps, compressors and other processing plant in order to gather and clean the gas before pumping to the nearest arterial gas pipe.
This industrial site will work 24 hours per day with a noise factor which will be heard in a rural area up to 1½ kilometres. It will also have a smell factor, probably hydrogen-sulphide, and also a sight factor, not consonant with rural countryside.
I now return to the DoE circular. This circular makes no mention whatsoever of the difference between gas abstraction and oil abstraction. It gives no guidance at all. It is evident from my description that the damage to the environment from gas abstraction is of a very different nature from oil abstraction, so four questions arise on this. Why does the circular say nothing about the potential objections to gas abstraction? Is the DoE not informed on this?—at least they are now. Do they think that planning authorities should ignore these factors? I hope not. And how many full-scale on-shore gas abstractions are there in the United Kingdom? We know that there is some oil. What gas abstractions are there? The impression is given that not very much is known about on-shore gas abstraction and that the DoE is hoping for the best.
Now it happens that the proposals for exploration and production in my neck of the woods—Dunsfold, Alfold and Chiddingfold—are all expected to be for gas. Only the Chiddingfold exploration borehole has been drilled so far and that has proved gas. The oil company promoting this work has gradually, in answer to much questioning, given information about what will be involved, which the company has learned from its seismological survey over a very big area.
The gas deposit at Dunsfold runs across the middle of the village from east to west, in a cigar shape pattern about two miles long. I am informed that one of the favoured positions for the industrial site is about half a mile from the village church and half a mile from where I live, so my interest is a fairly close one. No doubt, other threatened villages have similar problems. So I have said enough, I think, to indicate
176
that the arrival of commercial gas abstraction in a village will drastically change the character of the village. Incidentally, to add insult to injury, the local community, which does not have a main gas supply now, will not even get a main gas supply after all this.
So I turn to the questions of national policy. It is clear that on-shore abstraction of gas raises serious environmental objections. It is also clear that experience in the United Kingdom is in its infancy, and I cannot believe that the technology of management could not be greatly improved. So I should like to ask these questions of my noble friend.
First, at the present time, when North Sea oil and gas supply is in such abundant surplus that the price has had to be cut, despite the serious financial implications, is it really in the national interest to press on with development of all on-shore finds of oil and gas, irrespective of the environment? Secondly, would it not be better in the national interest, after proving the presence and capacity of an oil or gas deposit, to delay development to a time when the market is strong enough to absorb it?
Thirdly, in view of the prospect of an industrial site, as I have described, of eight to 10 acres containing compressors and cleaning plant at every gas deposit which is to be developed, operating for 20 to 25 years, in the interests of conserving the environment of these attractive rural villages should not on-shore gas abstraction for production be postponed until the technique has been developed to pipe the gas away to a central processing plant sited in some suitable industrial estate, thus reducing the damage to the environment to the same dimensions as oil abstraction?
I conclude by referring to the debate which is to take place next Monday on the 1984 Report of the Royal Commission. The burden of the report is to survey the progress which has been made in the past 10 years in reducing pollution in land, water and air and to examine what still remains to be done. All noble Lords will know that the story is that thousands of millions of pounds have been spent and immense efforts made to overcome the neglect of past generations and to repair the damage done. Today we are conscious of the continuing need to conserve the environment—above all, to prevent fresh arrears accruing.
To permit these unspoilt rural areas of Surrey, Sussex and Hampshire to be defaced by a rash of oil and gas developments, especially gas, without ensuring adequate protection of the environment would be to do just that—creating new pollution for our successors to clear up in the future. I am sure that this is not the intention of my noble friend, so I look forward to hearing what steps he can take to strengthen this offending circular to help local planning authorities protect our beautiful countryside.
6.5 p.m.
Lord Campbell of Croy: My Lords, I am sure that we are all grateful to my noble friend Lord Nugent of Guildford for having drawn attention to this recent draft circular and bringing to our notice in your Lordships'House the important matters with which it deals. I believe that they need to be widely understood and then handled with care by the authorities, both Government departments and local authorities.

177
The draft circular, coming from the Department of the Environment and the Welsh Office, deals with England and Wales, and I should like to make a brief contribution, having myself been involved in one way and another in the discovery and production of off-shore oil since 1970. On-shore activities and installations were created by that, which produced similar problems but on a larger scale than those produced by on-shore drilling. I declare again an interest to the House in that I have spent the past nine years working in the oil industry with a company which is the operator of one of the largest fields in the North Sea.
I should like to offer two propositions: first, there need not be conflict between the national need to realise our resources of oil and gas and the requirements of preserving the countryside and amenity; secondly, there is a danger that, because this is a new industry within Britain, unfounded alarm and distress can arise from fear of the unknown. On this second proposition, I am acutely aware, from my own experience in the early 1970s as Secretary of State for Scotland, of what can happen in the way of almost hysteria about the development of a new industry.
The platform building sites on the seashore which were required are of massive proportions, as are the structures which they build. There are also other onshore installations, such as the terminal on Flotta in Scapa Flow. Those were all proposals which excited great concern and anxiety in Scotland and elsewhere. Of course, the environmental bodies immediately registered their worries. But the general public also, particularly in the areas of Scotland concerned, were naturally alarmed. They raised objections because they were unsure what was coming from this new industry, and what was needed quickly was the dissemination of clear and accurate information about what was in fact involved. I remind your Lordships that this was all to be done in areas of great natural beauty, mostly in the Highlands, in the Firths. The concern was not only about the areas, but also about the wildlife that might be threatened.
I am glad to record that the fears of the responsible objectors were met, and in those cases it was consequently possible to avoid public inquiries which might have delayed North Sea oil production for up to two years. The Forties field, for example, the first very large field to be discovered, would have been delayed for about two years had there been a public inquiry, because two of the platform jackets were built at Nigg Bay. Her Majesty the Queen would not have been able to perform the inauguration ceremony for about two years after the date when she did so.
It is fortuitous that my own home is in northern Scotland, the scene of this action. I have been known there for many years as one who is interested in protecting the environment and as one who has a knowledge of shore birds. They knew me first in that area as somebody who is an environmentalist and secondly as a Secretary of State who was concerned with the planning procedures. I suggest that this demonstrates a healthy sense of priorities. The message which I hope I can contribute to this debate is that these installations—terminals, yards, associated
178
pipelines and other equipment on site—have not since then given rise to any further serious objections, although they are situated in areas of outstanding natural beauty. Indeed, the reverse has been the case. There is universal concern in these areas when there are reports that these installations may not be needed in future years due to advances in technology and because of the facts of geography.
Speaking therefore from the point of view of my personal interest in protecting the environment, coupled with some knowledge of the oil industry, may I make a few comments on the draft circular. In a large number of the cases which one can foresee, it should be possible for an oil company to accept the planning requirements for the site, though this may mean extra expense. The technology which is being developed in the North Sea offers various possibilities which could also be used onshore. I believe that the oil companies should go out of their way to comply with the requirements of good and sound planning.
My next point is that the local authorities and the oil companies concerned should take the trouble to inform local communities about their plans. Perhaps this could be done at public meetings, as has been shore oil wells in operation which are so very well concealed or disguised that one would have no idea that they were connected with the industry. I am pleased to see that the nuisance of noise is mentioned several times in the circular. I believe it to be right that noise nuisance should be emphasised, particularly if it is a noise which continues throughout the night, as a result of which nearby communities would suffer.
My next point is that the local authorities and the oil companies concerned should take the trouble to inform local communities about their plans. Perhaps this could be done at public meetings, as has been suggested in paragraph 14 of the draft circular. They could then dispel the rumours and exaggerated fears which can build up quickly. They could also learn of particular problems in the area and adapt their plans accordingly. This has been done on several occasions in different areas of Scotland, with very good results.
I hope that the Government will consider with the greatest care the comments of my noble friend Lord Nugent of Guildford on additional provisions in the draft circular to improve the protection of local communities. I foresee the Government, local authorities and operating companies being able in this way to proceed with the confidence of those local communities.
6.14 p.m.
Lord Teviot: My Lords, with some embarrassment I have to say that owing to a long-standing engagement I must crave the indulgence of your Lordships. I shall be unable to remain for the winding-up speeches and my noble friend's reply. This is the first occasion upon which I have had to leave before the end of a debate. I hope that it will be a long time before it ever happens again.
Your Lordships may be aware that I asked a Question concerning the Government's policy on drilling for oil in areas of outstanding natural beauty—in particular, Ditchling Beacon—in November of last year. I am very pleased that my noble friend Lord

179
Nugent of Guildford has seen fit to raise again more or less the same subject. I agree with him about the additional hazard of gas. However, the essence of my argument in November of last year was that areas of outstanding natural beauty are, first, as much a part of the nation's natural resources as are oil and gas and, secondly, that governments of all complexions have recognised this by designating them. Furthermore, a fixed and finite amount of beautiful landscape, peace and solitude are available in this crowded island, whereas oil and gas reserves, if not infinite, at least are currently in surplus and, unlike landscape, are ultimately replaceable by alternative energy resources.
Again one must say that the Government have abrogated their responsibility, particularly with respect to areas of outstanding natural beauty, by leaving planning decisions relating to oil and gas exploration and production in the hands of local authorities which, for a variety of reasons, are not the best people to handle them. Furthermore, having left the planning decisions to local authorities, the Government have not provided them with either the means or the policies by which to make sound judgments as to the relative merits of the case for oil and gas against landscape and social amenity. I said also—this is a particularly important point—that it was evident that local authorities were catching up with the flood of applications too late and are only now developing their policies.
My noble friend's objections to gas exploration at Dunsfold are similar to the objections raised by the residents of Ditchling. Dunsfold is not in an area of outstanding natural beauty. Nevertheless, it is just as pleasant an area, though the AONB label is not attached to it. The Government were prepared to let the normal planning process take its course when responding to my Question in November 1983, so why should they take any more notice now? The answer is that since November 1983 there has been substantial experience of the effects of on-shore oil and gas exploration upon local communities and landscapes. There is also evidence of how seemingly innocuous applications for single exploratory wells and well sites can grow like Topsy, once commercial interests have taken control.
May I give to your Lordships two examples. The first is Graffham in West Sussex. As a result of their direct experience of oil exploration at Graffham, West Sussex County Council have tightened up their planning policies. There are indications that they wish they had never started, but it is now too late. My second example is Humbly Grove in Hampshire. No fewer than 70 wells on the Humbly Grove site have been sunk—far in excess of anything which was envisaged at the time of the original exploration application. As a result, a local residents committee has been formed to fight it, but again it is too late. The Government have at last produced some guidelines for local authorities. These are too late. I reiterate also that I believe such decisions should be taken out of the hands of local authorities.
That said, what can one say about the draft proposals? In my view, three points can be made. First, the Government appear to lack the courage of their own convictions. There are occasions when their
180
proposed actions do not match the merits of their own arguments. Secondly, there are still many areas where important policies and operating procedures remain to be developed. Thirdly, there are some potentially misleading statements. Let me give to your Lordships a few examples.
The draft proposal acknowledges that there is currently a surplus of oil and gas from the North Sea. It also states that new fields are even now being developed off shore, particularly in estuaries and in relatively shallow water off the coastline. If that is the case, what is the importance and urgency of developing on-shore fields? We already have a surplus; and oil and gas developments in shallow water are far cheaper than in deep water. So economically, and in future energy supplies, the Government's requirements are being met without recourse to on-shore wells.
Section 9 of the draft acknowledges proposed developments in specially designated areas of the landscape, and it specifically mentions that AONBs should be subject to the same "rigorous examination" as national parks are currently accorded. That is from Department of the Environment Circular 4/76. Yet nowhere in the text of these draft proposals are local authorities told how to apply "rigorous examination". No special provision whatever is made. Indeed, Section 11 states that the Government believed that,
"The provisions operative for all minerals [a decade ago] provided a sufficiently comprehensive and distinctive framework of control to meet the Committee's concern, and this remains the position".
Section 24 of the draft states that
"The new edition of the Memorandum on the Control of Minerals Working (the Green Paper) will cover in general terms all those detailed environmental factors which mineral planning authorities should have regard to in deciding mineral applications".
Once again we are talking of the future tense. Is it not time that applications were considered under properly considered and fully developed policies?
In summary, I believe that these draft proposals are too little and too late to have any real impact. I urge the Government to take closer control over on-shore development and, to use their own phrase, to be more "rigorous" in their examination of all the issues involved. I wish my noble friend great success in his opposition to gas developments on his doorstep. Furthermore, having read the report put up by the local protection association—an excellent document—I will refer to one particular road. It is the A.281 which runs between Horsham and Guildford. It is one of the most unpleasant of roads to drive along. It is very dangerous and if Surrey County Council goes ahead, I suggest that they dare not do so until the M.25 is finished. The A.281 is a very dangerous road now and it will be made very much worse by the proposed development.
6.24 p.m.
The Earl of Onslow: My Lords, we had in the last sentence of the speech made by my noble friend Lord Teviot a perfect example of the quandary we all face. He complained, justifiably, about the state of the A281, which I, too, drive down. The answer would be to straighten it, widen it and make it into a dual carriageway—whereupon the same noble Lords would all be on their feet complaining about the horrendous

181
damage being done to the environment. We have to be extremely careful. When we take objection to any form of development or progress, we have to be very careful that we do not fall into that very easy trap.
As a fellow Surrey Peer I am delighted that my noble friend Lord Nugent of Guildford has raised this matter in your Lordships' House today. I will try to confine my remarks to the Surrey development plans. Of course we need energy, and certainly gas is one of the cheapest and most efficient forms of energy we have. The creation of jobs and employment is an important objective for good and sensible government—but so is the preservation and protection of the qualities of a civilised and beautiful countryside a prerequisite of sensitive Ministers.
My noble friend Lord Nugent has pointed to the lack of sufficient emphasis on environmental factors in this particular circular as well as the failure to differentiate between the undoubted dissimilarities between oil wells and gas processing plants. I should like to add what little emphasis I can to the criticism of that lack of emphasis.
Paragraph 21 of the circular says it is essential to screen or landscape sites. But a later paragraph shows that an oil site on land is one of the longest surviving of these particular sites, and should last for about 25 years. An oak tree barely reaches shoulder height in 25 years, so it means that we have either to build earth banks or bury the site, or use those enormous friends of every single garden centre owner—and here I declare an interest as one of them—the Leylandii cypress. I see that my noble friend on the Front Bench also has some experience of these factors and knows about the Leylandii. They offer an instant screen in the area where I live.
This brings me straight on to the prospective drilling for gas by Conoco in the area where my noble friend Lord Nugent lives. Perhaps one would be slightly more sympathetic to Conoco if this development was going to turn my noble friend into an instant J. R. Ewing; but the Petroleum (Production) Act 1934 nationalised (as always by a Conservative Government) the oil rights, and it thus effectively denies my noble friend his stetson.
The part of the south Surrey/Hampshire/Sussex border where all this is due to take place is an exceptionally attractive area in a very English way. It is the countryside of Cobbett. It is a close countryside full of oak trees; and the hedges still continue their old pattern, produced by early enclosure. The contrast with the much larger and more open Scottish countryside is very marked. I drove to the north of Scotland the other day. One saw the oil rigs being built on Nigg Bay, and in a funny way they are very beautiful, because they are so far away. They are not close in. I said to my wife, with whom I was driving to Scotland, "In a funny way they remind me of Chartres Cathedral, in that they come straight out of the surrounding countryside". That is a very subjective judgment, but one thing of which I am absolutely certain is that an eight to 10-acre concrete gas processing site can never produce that kind of reaction in the Surrey countryside or in a close English countryside. It is a difference of perception between different countrysides.
182
If one travels on the M6 on the way to Scotland, just south of Carlisle the road cuts through and there is an enormous contrast between great banks of hills on one side and the road going through the middle. There is something essentially beautiful about that. That beauty is totally absent on the M25, cutting through the close English countryside. I am totally prepared to accept that what I am saying is totally subjective and probably personal to me only. There may be people who think that the M25 cutting through close English countryside is much more beautiful than the M6 cutting through big, open countryside. On the whole, I believe that more people tend to agree with me.
The countryside where my noble friend lives really has got to be protected from the pressures. Of course, that protection must not be an absolute dead hand on any development. Succumbing to the threat that this development produces for a maximum find of gas for six months for the use of the South Eastern Gas Board—and, as my noble friend said, the threat is to villages that do not even have gas—is not worth the damage that it is going to cause. I hope it will be looked at in enormous detail and with even greater compassion and care.
Rightly, the agriculture industry is being criticised for some of its more insensitive environmental habits. The gas industry can cause much more damage than farmers, so it must take heed of the warning. Above all, I hope that the county councils of Surrey, Hampshire and Sussex, who are obviously in the forefront of our minds, will be Bismarckian in their iron determination not to allow any drilling or production development without the strictest of all conditions being imposed. All I am asking is that enormous care and even greater concern are shown by those in authority. If it is not, they will have committed an outrage on an area of especially subtle and gentle perspective which is a beautiful and natural part of our inheritance.
6.31 p.m.
Viscount Torrington: My Lords, I am grateful to the noble Lord, Lord Nugent of Guildford, for bringing this interesting document to the attention of this House. As usual, before I continue I must declare an interest in this subject. While I have no connection with the company which has applied to drill at Dunsfold, I am attached to a company which is involved in precisely the same kind of business. I live in Hampshire, where there is a lot of this sort of activity, but I have to say to your Lordships that most of my company's activities are in Scotland, although shortly to move south.
Having declared that interest, I suppose that if I were to say that it is a good and balanced paper it would be to condemn it out of hand. I certainly have to agree with earlier speakers that the paper does not address the subject of gas development in the detail which it perhaps ought to do. However, my noble friend Lord Nugent lives at Dunsfold, where these sort of developments are not welcome. I have seen two areas in Scotland where planning applications have been made for drilling, one of them not so far from one of those rig-building yards, admittedly, but another in a fairly attractive part of Fife, where both the local authorities and indeed the local people have been very

183
glad to see this sort of development happen. I am sad to say that the wells concerned resulted in dry holes and there has been no further development to please the locals.
My noble friend Lord Nugent brings a great deal of experience to this topic, in that he served in the past in the Ministry of Agriculture and later on the London and South-East Regional Planning Council. Perhaps after the debate he can explain to me why there seems to be a system of planning for agricultural matters which is totally different from that for, for example, oil and gas. The valley which runs past my village in Hampshire has recently been disfigured by the erection of an agricultural feed mill in the name of an agricultural building. In fact, it is hardly an agricultural process. It is the most insensitive development I have ever seen. I think I can honestly assure the House that the oil industry would never contemplate onshore in the south of England or in any other part of the United Kingdom, anything like so insensitive a development.
In this paper the phrase "good oilfield practice" is mentioned. This is perhaps an industry term of art. In the old days it meant using the right steel pipe, the right pieces of gadgetry and the right weight of mud while drilling a hole. However, in recent years this has come to mean a great deal more and, in the context of exploration on-shore in the United Kingdom, good oilfield practice has one chapter on the technical side and several chapters on the preservation and care of the environment. The oil industry is only too aware that it has to live, not by public acceptability, perhaps, so much as by public forbearance, because, as an earlier speaker mentioned, there are no financial benefits to the noble Lord, Lord Nugent, from the fact that he may live within the drainage area of an oil or gas well.
I know little about the development by Conoco at Dunsfold, but no one seems to have mentioned the fact that the well concerned is to be drilled on an airfield which is in active use. I am surprised that it causes so many ruffled feathers. It seems to me that it is an activity which is—
The Earl of Onslow: My Lords, I am not sure whether I am in order but perhaps I may be allowed to help the noble Viscount on this point. That airfield is not like other airfields. In fact it is extremely sensitively done and is surrounded by trees. In itself it is a very nice piece of countryside. That is the point. It is not like London Airport or Gatwick.
Viscount Torrington: My Lords, I am grateful to my noble friend Lord Onslow for that. Nevertheless, it is an airfield.
I should also like to point out that, as I understand it, we are talking of a possible deposit at Dunsfold of some seven kilometres by three kilometres. That is the technical people's view of the possible size of the field. I should like to point out that if this was an oilfield it might require about 100 wells to develop it. Due to the fact that it is gas—and I understand the reservoir is fairly permeable—the whole field may be developed with as few as two or three wells. Therefore, from the point of view of disruption from drilling there is not too much to fear. The actual surface facility left at the
184
wellside afterwards will amount to something a little bigger than a pillar-box. There are regulations which require it to be fenced within a certain distance but intrinsically it should be very inconspicuous. Certainly, in the context of a producing well on the airfield, one would not know that it was not a hydrant for aviation fuel.
I agree that the gathering system is a greater problem. I do not know whether the noble Lord, Lord Nugent, was quite correct. He seemed to imply—and no doubt he will forgive me if I misheard him—that there was to be more than one gathering system. He said, I think, that there would be one for each well site. I do not think that that would be the case.
Lord Nugent of Guildford: My Lords, may I help my noble friend? I said one for each find or deposit. One for the whole deposit. I also described, for the information of my noble friend, the dimensions of the gas deposit, as forecast now by the company, as stretching some two miles from east to west across the centre of the village. The proposal to drill a well on the extreme end of it on the airfield, therefore, does not describe the effect it would have on the village itself.
Viscount Torrington: My Lords, I appreciate that. Until at least one more well is drilled no one has any idea of how big this field will be and whether ultimately it will be an economic field.
It is obviously necessary to have a balance between the environment, the potential for employment and the needs of the oil industry. I was interested to see that a number of objections to the development at Dunsfold queried whether gas development was really necessary. The sort of field which might be there could in fact contain, at import replacement values, some £100 million to £200 million-worth of gas. When we are about to buy Sleipner gas from Norway very expensively, that is obviously quite important. If cumulatively we developed a number of fields through southern England, that could do quite a major job in replacing those proposed imports, and, personally, I should rather overlook a sensitive oil development than the operations of an insensitive farmer.
6.40 p.m.
Baroness Nicol: My Lords, we are very grateful to the noble Lord, Lord Nugent, for giving us the opportuniity once again to discuss this subject. Some of us remember the debate last November in which we all took part. I sympathise very much with the noble Lord in his local difficulty, but I apologise; I do not know the area and therefore cannot comment on the likely effects on it.
It seemed to me that the circular indicated that a better system was being sought. I know that there are faults in it, but it is a consultative document and one hopes that during the consultations improvements will be made. After all, discussion of whether something is beautiful is very subjective. If one lives in an area that has been without electricity for a long time, the sight of a line of electric pylons marching towards you can be very beautiful indeed. If one is out of work and the local community is depressed, the prospect of employment from a local industry can, again, be a very attractive thought.

185
I have one or two little comments that I should like to make on the beginning of the circular. At the end of page 1 it says:
"This Circular is not considered to have significant expenditure and manpower implications for mineral planning authorities".
I should like to remind the Minister that during the time of the discussion last year the Association of County Councils was very worried because it was said that the amount allowed in the planning regulations to deal with planning applications for these oil developments was nothing like enough to cover the cost of the officers' time. I wonder whether anything has been done about that. When one considers the profit in a successful oil strike, the fact that ratepayers may have to subsidise the cost of the planning application is not acceptable. Perhaps I may be told about that at the end of the debate.
I am also concerned, as is the noble Lord, Lord Nugent, that the Secretary of State for Energy still appears to have sole responsibility for the issue of licences. It seems to me that there should at least be discussion with the Department of the Environment at a very early stage before any licences are issued.
However, the fact that licences for the three major stages—exploration, appraisal and development—now require planning permission is an improvement on the old system, although I wonder whether the vibroseis stage should not also require planning permission. Once the initial seismic exploration has revealed the possibility of an oil or gas deposit, the pressures will be very great to go on from there. The pressures on the local authority to refuse if it is told that it is in the national interest are very great indeed. Therefore, I wonder whether planning permission should be required at the very beginning or whether there should be much wider consultation at the stage when the initial vibroseis exploration shows possibilities.
Also I believe—and this was something, again, that we discussed last year—that there should be no-go areas. The best safeguard of all, of course, is to establish consistent standards of planning control throughout the country. I do not agree with the noble Earl that local authorities are not capable of implementing the planning requirements, but there must be a consistent standard. I think at the moment it varies very much from authority to authority. I shall return to that in a moment.
There is a temptation to give special consideration to national parks and areas of natural beauty. Every environment is important to the people who live in it. That is another reason why I feel that standards should be uniform Every resident of every area where exploration is likely to occur is entitled to have good standards of control and reinstatement. The control of air pollution, noise and traffic have all been mentioned. They are just as essential whether or not the village or town is labelled an area of natural beauty.
We understand the need to establish the existence of national resources. There are just a few areas in which exploration should never be permitted at all. I refer particularly to SSSIs and some nature reserves, where restoration would be impossible. Some SSSIs—the
186
Minister seems to be in difficulty: SSSI stands for site of special scientific interest. Some of them date from the ice age. To disturb them for any purpose whatsoever is unthinkable. They are our heritage from long ago. They cannot be restored and must not be disturbed. It is our duty to maintain them and hand them on to the next generation. I think that from them all threats should be removed.
The East Sussex County Council, whose wish to amend its structure plan was discussed in detail last year—which I criticised rather heavily at the time—has, after wide consultation and after listening to the debate in this House, come up with a very acceptable document. I commend it to your Lordships. I believe that it is before the Minister at the moment. It has not yet been approved by him. It has within it all the difficulties which are explored in the document, and I think that it gives very good protection to all the aspects. It is a long document and I do not propose to read all of it to your Lordships. I should like to mention just one or two of the things that it says:
"The County Council supports in principle exploration for oil and gas. It supports production of oil and gas insofar as it is in the national interest but this does not imply any precedence over the countryside and conservation policies in this plan. Development will not be permitted which"—
and it lists a number of instances; I will not go into them all because they are not all applicable everywhere—
"is inconsistent with the objectives of an area of outstanding natural beauty or a conservation area … would damage an ancient monument … would prejudice the reasons for which a site of special scientific interest was notified or for which any nature reserve was declared".
If that became an accepted practice throughout the country, I think that it would meet most of the objections raised by most of the conservationists and environmentalists who at the moment are so worried about these possible developments. As I say, the document goes on at great length but I shall not weary your Lordships with it. I recommend those who are involved in such worry to read it and press the Minister to make this a national standard.
To come back to the original discussions that we had, as I understand it, the drilling rig, which is so high and which cannot be screened, is normally a very short-term development. When it goes, it is replaced by a "Christmas tree", which is like a glorified water hydrant. It is a bit larger but not much. It can easily be disguised. I think perhaps it is unreasonable not to say that that would be acceptable, given that there are proper consultations with the local authorities and that it is properly disguised when eventually it is put into use.
I cannot speak about gas development. I do not really know enough about what is involved in the end. But I know that all the time new technology is occurring which will reduce the impact of all these developments on the countryside. Provided proper consultation is undertaken, the local authorities keep up to date and the oil companies are made to keep up to date in their application of the new technology, it is perfectly possible for developments to be made which will not have too much impact on the surrounding area.

187
But we have to ask ourselves the last question of all. It is this. We should be seeking to conserve for future generations not only the environment but our resources. Are we making proper use of the resources that we have? Are we making proper attempts at the conservation of our resources? Do we really need to go ahead with many of the explorations that we are doing? If the answer to that last question is, yes, then we must accept it, but I really wonder whether the first two questions have been properly explored.
6.50 p.m.
The Earl of Avon: My Lords, I welcome the debate initiated this evening by my noble friend Lord Nugent of Guildford. Oil and gas on shore is a most topical subject and my recent spell away from Environment at the Department of Energy has certainly given me an added insight into the subjects. I am therefore grateful to my noble friend for asking this Question and, indeed, to other noble Lords, whose contributions have been both balanced and constructive. My noble friend asked specifically about the Government's intentions as to the draft circular produced by the Department of the Environment and the Welsh Office. I can, of course, assure him that they are wholly honourable. I can also respond in the knowledge that this is the most straightforward question to answer of the many asked this evening.
The draft circular on Planning Control over Oil and Gas Operations is at present out for consultation with interested parties. We have asked for comments by the end of this month. We shall then consider all the representations that we have received together with the views expressed in discussions with the local authority associations, the industry and others. We intend to publish a final version by the end of the year. I have no doubt that this consultation period will prove most valuable.
Interest in the draft circular has been considerable. So far we have had an encouraging response. Some comments have been kinder, like those of the noble Baroness, Lady Nicol, some not so kind like those of my noble friend Lord Teviot. I should perhaps correct something that I think my noble friend Lord Teviot said about the Hampshire County Council. I do not believe that they were surprised by the expansion of oil development. The planning application for which approval was given in August included seeking approval for 65 wells, and this was closely examined by the planning authority before permission was granted. The existing exploration wells were given planning permission several years ago.
Many of the points raised so far in the consultation—I stress that we still await the views of a number of important interests—have been touched upon this evening. I shall seek to respond to these. But we have some way to go before we are in a position to assess what exact changes are needed in order to secure the correct balance between the need to satisfy our energy requirements and our wish to protect the environment. My noble friend Lord Onslow touched on this subject. I can assure the House that all the comments that we receive—and I should like to stress in particular those made this evening—will be considered most carefully. We intend to get the
188
balance right and to produce a document that will command as wide a range of support as possible.
There are conflicting views and, indeed, we have heard them tonight. But I have no doubt that some considerable measure of agreement can be reached. I might mention to my noble friend Lord Onslow that I am told that Kimmeridge, for instance, which has been going for 20 years now, is very well screened and quite attractively landscaped. I understand equally that Wytch Farm is in an area surrounded by trees. The draft circular aims to provide guidance to mineral planning authorities on the exercise of their powers over on-shore oil and gas development. In particular it indicates the national policy considerations that need to be taken into account, the respective roles of licensing and planning systems in regulating and controlling such development, and some of the particular factors that need to be considered when determining individual planning applications. It also explains just what is involved in the exploration, appraisal and production stages of oil and gas development, although it is not designed to provide a fully exhaustive account of this technical subject.
The first question that I should like to answer is, why do we need to go for oil and gas on shore at all when we are so blessed with our North Sea reserves and when there is a worldwide oil glut? There is no one response. I should like to put it this way. We are not concerned just for the present. We need to look ahead against the prospect of uncertain world energy supplies. Oil and gas are both extractive industries, and supplies are inevitably depleted over time. I should perhaps mention that even today we import 25 per cent. of our gas needs. It is not clear how long production from the North Sea can be maintained at present levels. That depends on very many factors. But it is the Government's intention to maintain a large share of domestic production into the next century. To achieve this, we need to maintain a high level of exploration activity. I believe that the Government have a clear duty to establish the extent of our oil and gas reserves and to ensure that this is done in an environmentally acceptable manner.
Our policy is also to ensure that proven resources are developed economically and expeditiously consistent with good oilfield practice and the protection of the environment. In this way, we can look forward to a responsible and creative contribution. Particular supply investments in oil and gas on shore as in other energy sectors are for the industry itself to justify in the first instance against commercial criteria. But, on-shore as well as off-shore, companies must first obtain a licence from my right honourable friend the Secretary of State for Energy. The licensing system is first and foremost designed to achieve a satisfactory balance of safeguards and rights between the Government in whom the resources are vested and the licensee. It is also designed to provide a framework for the orderly development of the resource itself, so that fields are exploited safely and responsibly and individual drilling proposals are rigorously scrutinised. So I hope that the House will agree that it is hardly a free-for-all.
Nor is there the implication that exploitation will inevitably follow the finding of commercial quantities

189
of oil or gas. Possession of a licence confers no right of entry onto the land nor does it confer planning permission on any proposed development. A licence always requires planning permission before the deep drilling of exploration and appraisal boreholes can be undertaken. And the Department of Energy requires evidence that the necessary planning permission has been obtained before authorising development wells and production facilities. In addition, under the new licensing arrangements to be introduced early next year, production licences will not be awarded unless and until a company has obtained planning permission.
I make no apology for emphasising these controls. I do so because they indicate our concern that development of our on-shore oil and gas reserves should go ahead only under the most stringent conditions. These apply whether or not the proposals relate to development in the most sensitive environmental areas and we shall continue to strengthen them whenever we consider it necessary to do so. I assure the noble Baroness, Lady Nicol, that the expression "sites of special scientific interest" is absolutely emblazoned on my heart after taking something called the Wildlife and Countryside Act through this House. We cannot but be aware that interest in on-shore oil and gas tends to lead companies to areas where there is strong national interest in preserving the landscape and in protecting particular environments and communities. However, it is an uncomfortable fact—and it has been said many times before—that the geology that harbours our oil and gas reserves is also responsible for the special landscape features and habitats that prompted their designation as areas of outstanding natural beauty or sites of special scientific interest.
Of course, special policy considerations apply to all development proposals in such areas and to those areas where oil and gas lie beneath high quality agricultural land. My right honourable friend and his predecessors have made very clear that we expect any such proposals to be subjected to the most rigorous examination as to their effect on the environment. I am more than happy to repeat that assurance tonight. There is no way in which oil and gas development can be permitted to proceed unless proposals are environmentally acceptable. The industry knows this and the local authorities know it. However, we have to face the fact—and my noble friend Lord Nugent has brought that out tonight—that, for example, in southern England, over 20 per cent. of the land area is protected in some way or another, and a large proportion of the remainder is either already developed or highly valued by farmers and other members of the community. There can be few areas where so rich a heritage of national environment occurs side by side with so well informed and knowledgeable a sector of the population. May I tell the noble Lord, Lord Nugent, that I have frequently driven through his village of Dunsfold, and next time I hope that I may stop and visit him. But, of course, that will have to wait until any application has been prejudged.
In these circumstances I believe it makes no sense at all to look for no-go areas. We have to find ways of reconciling these sometimes conflicting interests, each wholly legitimate in its own terms. Part of the search
190
for acceptable solutions means facing up to the fact that the more we know about the structure and location of oil and gas reserves in an area the more options are available from which to choose an acceptable pattern of development. This applies as much to areas where oil or gas bearing structures lie off-shore as it does on-shore, and this is why our draft circular gives explicit encouragement to exploration and appraisal, subject to the effects on the environment being assessed fully. Without this knowledge we do not know what we have and what options are open to us should we wish to exploit it.
A second strand in our search for acceptable ways of reconciling energy and environmental interests is to recognise that such choices are best made by those elected by the communities most affected. The Government are firmly of the view that planning decisions on on-shore oil and gas should rest as far as possible with the mineral planning authorities. It is demonstrably the case that local authorities are best suited to draw up sensible policies for such development following full consultation with the local people, and I pay tribute to those members and officers in local authorities who have done so to date.
Of course some applications, most particularly the larger ones, present difficult choices, and the policies which my right honourable friend approves in structure plans have to be designed to meet these cases as well as the less controversial ones. Our circular, when published, will give further guidance on the factors to consider in handling specific proposals. It is only in exceptional circumstances that my right honourable friend will wish to call in an application for his own decision.
The guidance in the circular will aim to be as positive as possible. It cannot, however, anticipate each and every case. Circumstances will vary markedly between different sites and proposals, and what is acceptable in one part of an authority's area may perhaps be rejected by that authority elsewhere. We shall look for consistency in the way proposals are considered and acted upon.
My noble friend expressed particular concern about the effects on the environment of gas exploration and development as distinct from those of oil. I should like, if I may, to turn to this question for a minute. A gas development is not necessarily larger or more obtrusive than oil. The size of the site depends to a degree on the size of the field and on other factors such as whether unwanted compounds like hydrogen sulphide need to be removed, and what other treatment is needed. This holds true for both gas and oil. I understand that if gas is confirmed at Dunsfold—I underline "if because there is uncertainty in exploration—the likely size of the site required would be somewhere around five to eight acres. Should hydrogen sulphide be present, I am told that it can be removed by a through, smell-free process and that the noise level would be minimal. It could even be inaudible from outside the site. My noble friend has produced his idea on gas to me fairly recently and I should like to continue to pursue it and let him know any further information which I might find.
Lord Nugent of Guildford: My Lords, before my noble friend leaves that point, will he deal with my question about the possibility of improving technology so that gas can be piped, as is oil, to an arterial point where it can be treated on an industrial site centrally, rather than in situ in the rural area where it is so objectionable?
The Earl of Avon: My Lords, I will indeed pursue this subject generally with my noble friend. Later on in my notes I have something about technology.
I believe that we neglect at our peril the important fund of expertise and advice available in those who live and work locally and who are most immediately affected by any proposals. Our planning system is designed to use constructively such skills and advice. I would say to the noble Baroness, Lady Nicol, who asked a question on planning fees, that these have been reviewed from time to time but no specific adjustment has been made to deal with oil and gas. It would, I believe, be difficult to produce such a refined set of fees, if I can put it that way, to reflect exactly the amount of work involved.
I should like to say, although my noble friend Lord Torrington has spent some time on the subject, that I, too, have been impressed by the awareness for the environment of those concerned with the exploration for gas and oil. I believe they really do care, and have been persuaded to care, for the environment, and I believe also that we should pay tribute to their willingness to return the countryside and keep the countryside in its beautiful state.
I should like to make two further points about on-shore oil and gas. Because it is an extractive industry, even the largest oil and gas fields will be depleted in due course. Production will cease and restoration of the site can begin. Mineral planning authorities do have the powers to impose proper restoration and after-care conditions on such development, both in relation to well sites and to the larger gathering and handling facilities, and we expect these to be used imaginatively.
Secondly, I know that some noble Lords and others outside are worried about the possible proliferation of surface development facilities. This is not uncommon in the North Sea. In these circumstances the Government have the powers to ensure that the exploitation of such fields is carried out as one, and we shall use these powers if it proves necessary to do so.
I have welcomed the opportunity, so early after my return to the Department of the Environment, afforded by my noble friend's Question, first to listen to your Lordships' views and then to respond to them by explaining the thinking behind our advice in the draft circular. One of the benefits of issuing advice in draft form for consultation is that those who have a point can express it before we go to the printers and commit our thoughts to posterity. I can assure your Lordships that I and my department will consider very carefully all the points that have been put tonight. I am most grateful to my noble friends and other noble Lords for what has been a most interesting debate.

Oxfordshire Bill [H.L.]
Reported from the Select Committee on Unopposed Provisions, with amendments.

Warwick District Council Bill [H.L.]
Returned from the Commons agreed to with amendments.
House adjourned at seven minutes past seven o'clock.

  LOCAL ELECTIONS: 1986 DATE
  LOCAL ELECTIONS: 1986 DATE
  EDUCATIONAL CENTRES ASSOCIATION: DES GRANT
  EDUCATIONAL CENTRES ASSOCIATION: DES GRANT
  THE WHITEHALL THEATRE
  THE WHITEHALL THEATRE