Sitting of 3 April 1985

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

PRIVATE BUSINESS
SOUTH YORKSHIRE PASSENGER TRANSPORT BILL
Read the Third time, and passed.
LONDON DOCKLANDS RAILWAY (No. 2) BILL
Ordered,
That in the case of the London Docklands Railway (No. 2) Bill, Standing Order 208 (Notice of Consideration of Lords Amendments) be suspended and that the Lords Amendments be now considered. —[The First Deputy Chairman of Ways and Means.]
Lords amendments agreed to.

Oral Answers to Questions
  ENVIRONMENT

    Rates
    Mr. Simon Hughesasked the Secretary of State for the Environment how many and which county and non-metropolitan district councils have fixed their rate for the municipal year 1985–86 at (a) the rate for the year 1984–85 or below, (b) less than 5 per cent. above the rate for the year 1984–85, (c) between 5 per cent. and 10 per cent., (d) between 10 per cent. and 15 per cent. (e) between 15 per cent. and 20 per cent. and (f) over 20 per cent. above the rate for the year 1984–85.
    The Minister for Local Government (Mr. Kenneth Baker): I have today placed in the Library the information currently available. Although it is too early to give a firm estimate of the increase in rates for 1985–86, it seems likely that the average increase in general rates in England will be between 7 and 7·5 per cent., and the average increase in domestic rates between 8 and 8·5 per cent.
    Mr. Hughes: Is it not correct that in the shire counties the average rate rise will be more than 9 per cent., which is wildly far from the estimate given by the Secretary of State in December, when he said that he hoped that it would be in low single figures? Are not high rate rises entirely attributable to the Government's policies on rate support grant and rate capping? Does that not imply that authorities in Tory areas must cut substantially the services that they provide to stand any chance of holding the rate rises down, even to about 9 per cent?
    Mr. Baker: The hon. Gentleman has got it wrong, and unwittingly scored an own goal against the Liberal party. The average rate rise in the Conservative shire counties is
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    6·5 per cent., whereas in the one Liberal-controlled shire county it is 8 per cent. It is the old story that where the Liberals influence events spending and rates are high.
    Sir Hugh Rossi: Is my right hon. Friend aware of a document issued in the name of the Haringey joint union committee against rate capping, which has been endorsed by the London boroughs shop stewards on a Londonwide basis, calling for complete disruption of local authority services by phased action, including shutting down street lighting and traffic lights, stopping Thames water maintenance — [HON. MEMBERS: "Order."]—closing schools—[HON. MEMBERS: "Too long."]—taking over the financing of computer services of local authorities, and refusing to accept—
    Mr. Speaker: Order. The hon. Gentleman should not make a speech.
    Sir Hugh Rossi:—taking over power—
    Mr. Speaker: Order. Has the hon. Gentleman reached his question yet?
    Sir Hugh Rossi: Does my right hon. Friend agree that that is close to criminal conspiracy and incitement to unlawful action? What action will he take?
    Mr. Baker: I have not seen the document to which my hon. Friend refers and, therefore, I do not know its details—whether it is silly bravado or whether it amounts to something with a more sinister intent. I shall look at it, as he has drawn it to my attention today. Clearly, if it has a more sinister intent I shall draw it to the attention of the appropriate authorities.
    Mr. Redmond: What advice will the Minister give the authorities which have accepted the lower rating for this year and failed to meet their statutory obligations as a result?
    Mr. Baker: I know of no local authority or any rate-capped authority which is in danger of not meeting its statutory obligations because of the rate support grant settlement this year. Regarding rate-capped authorities, there was a significant move forward this morning in that a High Court judge told Hackney that it must set a legal rate. He ruled that there were no reasonable grounds for the borough to defer making a rate. I hope that this period of illegality will end.
    Mr. Hardy: Would any rate increase have been necessary, and would not the average rate demand have been at least 20 per cent. lower, had the Government maintained the same share of local authority expenditure that was provided in 1979–80? Will the Minister give the total burden placed on businesses and industry as a result of the change?
    Mr. Baker: As regards the proportion of the rate support grant since 1979, I remind the hon. Gentleman that the biggest cut was under his Government, when the former Chancellor reduced it from 66 to 61 per cent. in one year. The hon. Gentleman was a member of the Government who did that. The reduction this year from 51·9 to 48·7 per cent. means that there is less grant available, but, even so, if all authorities in England had budgeted to spend at target the average rate increases would have been lower than the ones that I have just announced.
    Mr. Beaumont-Dark: Has my right hon. Friend heard the news this very day of the stunning irresponsibility by

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    which the city of Birmingham, under its Labour masters, is putting up the rates by 43 per cent.? Is it not time for such authorities to stop talking about helping industry when they are going to ruin it and their citizens?
    Mr. Baker: My hon. Friend is correct. There could be no greater distinction between Conservative and Labour control of Birmingham. Last year, under the Conservatives, the rates fell; this year under Labour they have gone up by 43 per cent. That is bad news for the residents of Birmingham.
    Dr. Cunningham: Does the Minister accept the figures of the Rating and Valuation Association, which show that average rates will increase by more than 9 per cent. in this financial year—twice the rate of inflation? Does he recognise, as everyone outside the House and the Opposition do, that the biggest single reason for that is the consistent reduction in rate support grant? Rather than listen to his right hon. Friend berating Labour councils which are desperately trying to defend jobs and services, why do not the right hon. Gentleman and his right hon. Friend meet representatives of the Association of Metropolitan Authorities and the Association of London Authorities to negotiate a settlement of the outstanding difficulties?
    Mr. Baker: My right hon. Friend and I have made it clear that negotiations with the rate-capped authorities are unacceptable because the House has approved the rate support grant order and has agreed and passed orders for the rate-capped authorities. We have said that they are therefore not negotiable. It is now up to the rate-capped authorities to do what is legal—to set the rate which has been approved by the House.
    Mr. Heddle: Will my right hon. Friend confirm that the Liberal-controlled Isle of Wight county council has increased its rates by 38 per cent. since 1981, and that because of the Lib-Lab pact which now controls Cheshire county council, that council has increased its rate by 48 per cent. since 1981? Is that not disgraceful, and does it not show the hypocrisy of the question of the hon. Member for Southwark and Bermondsey (Mr. Hughes)?
    Mr. Baker: The figures speak for themselves, in that those who live in Labour-controlled shire counties will have an average rate of 178p this year, those in coalition-controlled county councils 156p, and those in Conservative-controlled county councils 148p. Those who live under Conservative-controlled county councils will be 30p better off than those who live under Labour and coalition-controlled councils.
    Mr. Stephen Ross: Will the Minister put the record straight and confirm that the Isle of Wight county council rate increase was 7·53 per cent.? The 1p rate added by the Liberal-controlled Medina borough council reduces it to 7·1 per cent. The average ratepayer in the Isle of Wight pays £30 per head less than the average ratepayer in Chichester and £600 or £700 less than the average ratepayer in Westminster. We have stuck by targets, but the Secretary of State for the Environment gave us the worst settlement of all counties. We lost 4p, and that is why the rates went up this time by 7·53 per cent.
    Mr. Baker: I think that I said 8 per cent.
    Mr. Ross: Why does the right hon. Gentleman not tell the truth?
    Mr. Baker: If with the district included, it is slightly less, I accept that. Even if it is 7·53 per cent., it is still substantially higher than the average for Conservative-controlled county councils.

    Local Authorities (Expenditure)
    Mr. Fatchettasked the Secretary of State for the Environment if he will abolish spending targets for all local authorities.
    The Secretary of State for the Environment (Mr. Patrick Jenkin): I have said that we would like to do so.
    Mr. Fatchett: Does the Minister agree that we have an absurd system of local government finance — [HON. MEMBERS: "Yes."]. I shall come to that point in a moment. The Government's new so-called objective targets under the GREA are completely ignored by the Government in the vast majority of cases when they set spending targets. Are not those spending targets a sign, first, of the Government's desire to run local government and, secondly, of their complete failure to reform the rating system?
    Mr. Jenkin: The purpose of the targets has been to rein back the growth of local authority current expenditure. They have succeeded in reining back that growth from over 3·5 per cent. a year above the rate of inflation to under 1 per cent. The targets have worked, and the great majority of local authorities have co-operated with them. That has been a solid gain for the country and the ratepayers.
    Mr. Patrick Thompson: When my right hon. Friend is carrying out the urgently necessary review of local authority finance, will he talk to our right hon. Friend the Secretary of State for Education and Science about alternative ways of funding education? That could lead to two advantages: first, the reduction of the rates burden; and, secondly, the removal of the discredited Burnham system for the negotiation of teachers' pay.
    Mr. Jenkin: The second part of that question should be addressed to my right hon. Friend the Secretary of State for Education and Science. On the first part, I have the impression from hon. Members on both sides of the House that people wish to see local decisions taken locally. That is one of the main purposes of the studies on which we have embarked. It is difficult to see how such a development could be consistent with centralising substantial areas of education spending at the Department of Education and Science.
    Mr. Straw: Despite the operation of target, which was deliberately designed to hit Labour authorities more than Conservative ones, the average domestic rate bill in the shire county areas is over 40p a week higher in the Conservative-controlled shires than in the Labour-controlled shires. Does that not show that people get more for less in Labour areas?
    On the future of the target system, does the right hon. Gentleman accept that the problem associated with target is the operation of penalties, and that it would be unacceptable to Conservative as well as Labour authorities if, instead of the target and penalty system, we had a penalty system based upon GREAs?
    Mr. Jenkin: The hon. Gentleman makes a naive comparison. The system is intended to reflect differences in resources among authorities. It is clear that in the past

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    four years the average increase in rates in Labour county councils has been 62 per cent. while in Tory county councils it has been 31 per cent.—exactly half. That is the true comparison that should be made between authorities under Conservative and Labour control.
    Secondly, I have made it clear that the extent to which we are able to move away from targets in the coming year will depend in part on what local authorities budget for this year, and in part on the mechanism that we may be able to put in place to exercise a restraining influence on budgets in 1986–87.

    Olympic Games
    Mr. Canavanasked the Secretary of State for the Environment whether he will arrange future meetings with the appropriate sports authorities to discuss the possibility of the Olympic Games being held in Britain.
    The Parliamentary Under Secretary of State for the Environment (Mr. Neil Macfarlane): I have no plans to do so. Bids for staging the games are the responsibility of the British Olympic Association and interested cities.
    Mr. Canavan: Will the Minister make it clear that the Government will give every encouragement, including adequate financial support, to the sports authorities to put in a bid to stage the Olympic Games in Britain? Bearing in mind the recent Government intervention leading to the switch in the venue of the England-Scotland football international from Wembley to Hampden Park, should there not be some Government intervention to ensure that some Olympic events are staged in Scotland? We should remember the recent exemplary behaviour of Scottish sports fans, compared with that of some of the hooligan elements down here.
    Mr. Macfarlane: There are many steps to be taken before anyone can plan for any eventualities in the next decade.
    Sir Hector Monro: Does my hon. Friend agree that we should welcome the Olympic Games, perhaps hosted partly in England, partly in Wales, partly in Scotland and partly in Northern Ireland? Will he continue to have discussions with the British Olympic Association, and does he have any information about whether a substantial fund of private money will be available to finance the games, as was the case in America?
    Mr. Macfarlane: The latter part of my hon. Friend's question is an important consideration. The most important attitudes are those of the British Olympic Association and individual cities. There is a long way to go before there can be any planning.
    Mr. Heffer: I trust that the Minister will press for Britain to host the Olympic Games. Will he bear in mind the interests of Merseyside, which has several extremely good stadiums, football teams that do not get involved in punch-ups and a good sporting record? Does the Minister agree that it would be a good area in which to stage part of the Olympic Games?
    Mr. Macfarlane: I am at one with the hon. Gentleman when he refers to the good behaviour of the football teams in his area. I pay tribute to them and their record. These are matters for consideration. I remain at the disposal of the British Olympic Association if it wishes to have further
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    discussions. There is a long way to go and, as I understand it, the selection is not made by the International Olympic Committee until mid-way through next year.
    Mr. Hirst: Is my hon. Friend aware that the sports promotion council in Glasgow has advanced claims to host the 1992 Olympics in that city? Given the diversity and quality of sporting facilities in Scotland, will my hon. Friend give an assurance that his Department will do everything possible to encourage the powers that be to consider Scotland as a place to host the Olympic Games?
    Mr. Macfarlane: I note what my hon. Friend said. I am sure that he will be well supported by my right hon. and hon. Friends at the Scottish Office in any possible or potential bids.
    Mr. Denis Howell: As the British Olympic Association says that it is the Government who have encouraged it to make a bid, what estimate have the Government made of the cost of providing a games village for upwards of 20,000 people, a 100,000-seater stadium, an international pool and similar facilities for 20 other sports? As the Government are restricting all local authorities' spending on sport, where do they expect the money to come from?
    Mr. Macfarlane: I am delighted to welcome the right hon. Gentleman's new-found zest for the private sector. I assure him that the Government have just as much vision as did the post-war Labour Government in hosting the 1948 games. Many steps have to be taken before any decisions can be made.

    Local Authorities (Expenditure)
    Mr. Allen McKayasked the Secretary of State for the Environment what representations he has received in response to the reduction in the prescribed proportion of capital receipts which local authorities may spend.
    The Minister for Housing and Construction (Mr. Ian Gow): My right hon. Friend and I have received a number of representations from right hon. and hon. Members and from local authorities. In response to those representations, my right hon. Friend has announced that local authorities may continue to use in full capital receipts from low-cost home ownership schemes instead of only 30 per cent. as proposed originally. He has also agreed to consider applications from local authorities which may not be able to meet their obligations under the Housing Defects Act 1984.
    Mr. McKay: Does the Minister agree that it is sheer economic madness and incompetence of the highest order that, when we have a crisis in local government with education, social services and housing, local authorities are unable to spend their own money, thereby saving by doing repairs this year rather than in future when the bill for such repairs will be greater?
    Mr. Gow: The hon. Gentleman will recall that the House has debated this matter fully on two occasions. The first was 27 February, when the hon. Member for Birmingham, Perry Barr (Mr. Rooker) was given responsibility for deploying the Opposition's case. The Government had a modest majority of 108. When, a fortnight later, on 13 March, responsibility for deploying the Opposition's case was transferred to the hon. Member for Copeland (Dr. Cunningham), the Government had a majority of 121.

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    I hope that the hon. Member for Copeland will speak for the Opposition more frequently.
    Mr. Latham: What urgency is my hon. Friend according to the departmental review that he announced in the latter debate? Has he instructed his officials that a new system should be in place by this time next year?
    Mr. Gow: I have told the House, as I have told my hon. Friend, that the present system of control by central Government of local authority capital expenditure is the reverse of perfect. Because we recognise that truth, and because this Government are striving towards perfection, we are giving more urgency to the review to which my hon. Friend referred.
    Mr. Rooker: The House is seeing more and more that the Minister does not want seriously to answer important questions put to him by both sides of the House. May I put to the Minister one question relating to the concession made by the Secretary of State in our last debate in respect of the Housing Defects Act? How many applications have been made by local authorities under that concession and, more importantly, how much money does the Secretary of State have available to make a reality of that concession?
    Mr. Gow: No applications have yet been received from local authorities in response to the announcement by my right hon. Friend in the debate last month. On 27 March the Department sent a circular to local authorities, a copy of which, if it is not already in the Library, will be placed there by me. The resources to be made available will depend upon the strength of the case that local authorities are able to make. In the debate my right hon. Friend made it clear that he would consider sympathetically applications by local authorities.
    Mr. Yeo: Since mobility of labour is one of the key factors in reducing unemployment, and since one consequence of the reduction in the proportion of capital expenditure that local authorities can incur will be to restrict the rate at which public sector housing is built, does my hon. Friend agree that the impelementation of this policy makes it even more urgent that we should take steps to abolish the Rent Acts so that the private housing market can be reactivated?
    Mr. Gow: I hope that it will be possible before too long to make a statement about the Government's policy in this matter.

    Conservation (Management Agreements)
    Mr. John Huntasked the Secretary of State for the Environment how many management agreements have now been concluded between farmers and local authorities since the Wildlife and Countryside Act 1981 came into operation.
    The Parliamentary Under-Secretary of State for the Environment (Mr. William Waldegrave): The Countryside Commission has been informed of 64 management agreements that have been concluded by local authorities under the provisions of the 1981 Act. Of these, 38 involve no financial consideration.
    Mr. Hunt: Does that rather disappointing total not indicate that the Act still needs a few more teeth? Is my hon. Friend aware that in some cases habitats and landscapes can be destroyed before a local authority
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    even knows about it, let alone has the chance to conclude a management agreement? Is not this an argument for some kind of notification procedure under which a local authority has to be given notice in advance of an owner's intention to carry out work on his land?
    Mr. Waldegrave: I do not think that these figures necessarily represent the whole story. The provisions of the 1981 Act are only a part of the battery of powers that are available. There was a recent case in my hon. Friend's constituency where a felling licence was ignored. The result was that large fines had to be paid by those involved, which should remind people that other powers are available to deal with these matters.
    Mr. Hardy: Will the Minister give further consideration to the point that his hon. Friend the Member for Ravensbourne (Mr. Hunt) has made, and at the same time commend those farmers who have taken part in management agreements and those who are involved in the farming and wildlife advisory group? Is it not clear that their increasing commitment to conservation is not matched in any sensible way by the present Administration?
    Mr. Waldegrave: The hon. Member will not expect me to agree with the last point that he made, which I rebut strongly. However, I am delighted to join him in paying tribute to the farmers who, in many cases, under the advisory group, are doing a very good job. The survey recently carried out by the National Farmers Union shows what is being done by those farmers who have a real care for the countryside.
    Mr. Kenneth Carlisle: Since management agreements should involve an element of positive management rather than dealing with the handing over of public money for nothing in return, does my hon. Friend have any information about how many of the management agreements include such a positive element?
    Mr. Waldegrave: I do not have the figures with me, but all the power is there for positive elements to be included in the management agreements. The fact that many Countryside Commission agreements do not involve the payment of money makes the point that there is much more voluntary co-operation than people often realise.
    Mr. Simon Hughes: Is the Minister aware of the comments of the Prince of Wales this morning that far too often farmers are still exploiting the land for profit without respect for conservation? Would not an appropriate response be to reinstate, at the behest of the Government, a provision in the Wildlife and Countryside (Amendment) Bill putting a duty on MAFF to consider conservation as well as agricultural interests?
    Mr. Waldegrave: As usual, the Liberal party is concentrating on form rather than reality. We want developments of the kind to which the hon. Member for Wentworth (Mr. Hardy) has paid tribute and which are indeed taking place. It is not a matter of passing Acts of Parliament and feeling that we have done something clever. It is a matter of getting real voluntary co-operation, and that is what the Government are doing.

    Washington, Peterlee and Aycliffe
    Mr. Fosterasked the Secretary of State for the Environment if he will make a statement on the future of the Washington, Peterlee and Aycliffe new towns.
    Mr. Jenkin: I announced on March 21 that the new town development corporations of Aycliffe, Peterlee and Washington would continue until 31 March 1988. That decision has been widely welcomed in the north-east.
    Mr. Foster: Is the Secretary of State aware that that decision has been widely welcomed throughout the northeast, and especially by Labour Members? Will he confirm, however, that he is reducing the staffing and capital budgets of the Aycliffe and Peterlee development corporations from £12 million to £2 million at a time when unemployment in my constituency is 26·8 per cent.? In his reliance on private capital markets, is he aware that the development corporations were set up in the first place because of the failure of those markets?
    Mr. Jenkin: The spending limits for all three authorities will be £11 million in 1986–87 and £8·5 million in 1987–88. We believe that that will give the development corporations ample opportunity to achieve the primary purpose of the extension — that is, to continue their promotional work and to complete the building work already in hand. In this context, I pay tribute to the way in which the development corporations have succeeded in attracting important investment to the north-east —notably the Nissan site, which I hope to visit in a few weeks' time.
    Mr. Fallon: Is my right hon. Friend aware that his decision is generally applauded in the north-east and that at a time of industrial change it is absolutely right to retain the job-seeking functions of the corporations?
    Mr. Jenkin: That is the primary purpose of extending the lives of the development corporations. I very much welcome the progress being made by Sir Ralph Carr-Ellison, who is seeking to establish a voluntary development body to perpetuate and, I hope, improve the work being done in attracting new firms to the north-east.
    Mr. Boyes: Is the Secretary of State aware that his right hon. Friend the Secretary of State for Employment informed me in a written answer yesterday that 6,000 people in the borough of Sunderland have been unemployed for more than three years? In those circumstances, is it not disgraceful and absurd that a respected job-promoting agency should be closed down?
    Mr. Speaker: Order. Does this have anything to do with the main question?
    Mr. Boyes: Yes, Mr. Speaker. With respect, I represent the new town of Washington, which is included in the question. Will the right hon. Gentleman tell his right hon. Friend the Secretary of State for Trade and Industry that, having created chaos in the north-east by not agreeing to an extension for the new town corporation—
    Mr. Speaker: Order. I thought that the Minister said that it was continuing. The hon. Gentleman talks as though it were closing down.
    Mr. Boyes: For your information, Mr. Speaker, the letter from the Department of the Environment about the future of the new town of Washington states that it has an
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    extension of 2¼ years only and that it will then be closed down. Will the Minister pass a message to the Secretary of State for Trade and Industry that, chaos having been created in the north-east by obstacles being put in the way of the extension of the new town of Washington, by limiting it to 2¼ years and not to five years, for which we asked in reply to the consultative document, he is compounding the unemployment problem in that area?
    Mr. Jenkin' I am very fond of the hon. Gentleman, and we on the Conservative Benches respect him greatly, but I must say that he has got it wildly wrong. My decision to extend the life of these development corporations to 1988 has been warmly welcomed by hon. Members on both sides of the House and by the entire community of north-east London — [Interruption.] — England. I am only sorry that the hon. Gentleman was not able to join in the chorus of welcome for my decision.
    Mr. Conway: As a former member of the board of Washington development corporation, I welcome my right hon. Friend's remarks this afternoon. Can my right hon. Friend tell the House whether the potential inward investment promotional rate of which he has been talking in respect of Washington, Peterlee and Aycliffe will apply also to other new town corporations, such as Telford, which adjoins my constituency, when they reach their winding-up dates?
    Mr. Jenkin: No firm date has been set for the winding up of Telford development corporation, save that it will be towards the end of this decade. If there are promotional activities to be carried on after that, it will be for the business and local authority interests in the area to decide how best to carry that forward. It has always been recognised that the new town development corporations would have a limited life. It is to make sure that the essential functions of promotion are carried on that I have extended the life of these three in the north-east.
    Mr. Dormand: Is the Secretary of State aware that I am one person on the Labour Benches who gives only a cool welcome to the extension? Having regard to the National Coal Board's statements on pit closures since the end of the miners' strike, is the right hon. Gentleman aware that, particularly in an area like mine, an extension of three years to Peterlee development corporation is simply inadequate? A minimum of five years is essential. Is he aware that he has cleverly put in blanket form the budgets for the three new towns? Is it not a fact—and will he come clean on this—that the budget for Peterlee development corporation is now less than half what it has been in the past? Will he say whether he is instructing Peterlee development corporation to reduce its staff?
    Mr. Jenkin: It certainly would be appropriate that the staffing of the development corporations should match the resources that they have available. I can assure the hon. Gentleman that I recognise that it is the concern of Aycliffe and Peterlee that they should have a fair share of the expenditure cake in comparison with Washington. This will be discussed with the corporations in the usual annual review of the finances.
    Mr. Cowans: Not representing any constituents in north-east London, I am not qualified to speak for them, but I am qualified to speak for the people in the non h-east. Perhaps the Minister would get it right. Will he accept that, after considerable pressure on him by my hon.

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    Friends to make a decision, the decision that he has made is wrong and the period is not long enough? It would make more sense, if he believes in being converted to the real world, to say that what is required is that the budget should be made much bigger. Finally, I welcome the hon. Member for Darlington (Mr. Fallon) into the real world. He has now left market forces. Perhaps the Minister should leave them as well.
    Mr. Jenkin: I am not sure that the hon. Gentleman's question calls for a reply.
    Mr. Cowans: There were three questions.
    Mr. Jenkin: The hon. Gentleman has recognised that the decision has been widely welcomed in the north-east, and that this now gives time for local authorities, the TUC and industrial organisations to work with Sir Ralph in order to bring into existence the new body, which I think will carry forward this promotional activity.

    Liverpool (Budget)
    Mr. Parryasked the Secretary of State for the Environment if he has any plans to meet the leaders of the Liverpool city council to discuss its budget proposals.
    Mr. Patrick Jenkin: No, Sir.
    Mr. Parry: Is not that an unreasonable answer from the Secretary of State, bearing in mind the special problems that Liverpool faces above all other local authorities, which the right hon. Gentleman acknowledges? Will the right hon. Gentleman now state what instructions are to be given to the district auditor concerning Liverpool? Has he made any plans to send in commissioners if the council refuses to fix a rate?
    Mr. Jenkin: I have made it clear many times in the House that the responsibility for administering services, whether in Liverpool or any other area of the country, rests with the elected councillors of that area. I have no powers to put in commissioners, and I have no desire to put in commissioners. I hope that the hon. Gentleman will use his influence to persuade the Liverpool city councillors that they must now make a rate to administer their city properly.
    Mr. Powley: Will my right hon. Friend remember, in his exchanges with Liverpool city council, that were he to make any concessions at all to the irresponsibilities of that local authority, that would be viewed with great concern by economic and responsible authorities such as Norfolk county council, which act in a responsible and economical way?
    Mr. Jenkin: Despite the boasts of some of the Liverpool city councillors last year, it is now widely recognised in Liverpool and elsewhere that no concessions were made to Liverpool last year, and it is not intended to make any concessions to Liverpool this year. The responsibility for making a rate rests firmly upon that city council.
    Mr. Wareing: Notwithstanding the answer from the Secretary of State, does he not recall his attitude following the visit which he and his hon. Friend the Minister for Housing and Construction made to Liverpool last year, when he saw the deplorable housing situation in the city? He promised that he would use his best endeavours to give more assistance to housing. Despite what the hon.
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    Member for Norwich, South (Mr. Powley) has just said about Liverpool city council, it is doing the responsible work of regenerating 17 priority areas. We welcome the new Tate in the north, but is it not a bit incongruous that the right hon. Gentleman offers largesse on the one hand for something that is hardly a priority in Liverpool, and on the other hand ignores the elected representatives of the people of Liverpool?
    Mr. Jenkin: On my visit to see the housing of Liverpool the following question struck me: how did it ever get like that, and who carried the responsibility for it? Secondly, I was struck by the immense progress being made by the housing co-operatives in Liverpool. I deeply regret the fact that Liverpool city council has thought fit to strike them off its list of those who receive help from it. I hope that the council will have second thoughts and support the housing co-operatives, as they are doing extremely good work.
    Dr. Cunningham: Not only is the Secretary of State's geography wrong today, but so is his history. Is he not aware that for 10 years his own party, in coalition with the Liberals, was responsible for the administration of the city of Liverpool? Does the right hon. Gentleman not recall that the Labour party has been in power for only just over a year? Is it not a fact that it has inherited an appalling mess from the right hon. Gentleman's friends? Why does he take such pleasure in being vindictive about that council's determination to help the people of Liverpool solve their problems?
    Mr. Jenkin: If the word vindictive were to be used, it might be much more appropriately applied to some of the members of Liverpool city council with whom I have tried to work and by whom I have been kicked in the teeth. If the hon. Gentleman still has any shred of influence in that quarter, perhaps he will recognise that, generally, authorities which seek to co-operate with the Government on inner city policy make more progress than those which positively refuse to do so, and take pleasure in doing nothing but attack the Government at every possible opportunity.

    Manchester (Rate Support Grant)
    Mr. Sumbergasked the Secretary of State for the Environment whether he has received any representations from Manchester city council in connection with the rate support grant settlement for 1985–86; and if he will make a statement.
    Mr. Waldegrave: Manchester city council was one of the 26 authorities represented at a collective meeting on 4 February.
    Mr. Sumberg: Is my hon. Friend aware that when Manchester set its rate on Sunday, against the advice of the hard-Left leadership, the leader of the council, Councillor Stringer, described it as something that would bring a smile to the face of my right hon. Friend the Secretary of State? If my hon. Friend is in touch with Councillor Stringer, will he ask him to bring a smile to the faces of some of my constituents who live on Councillor Stringer's overspill estates in my constituency, and to concentrate not on nuclear-free zones and police monitoring units, but on keeping those properties in a decent and proper state of repair?
    Mr. Waldegrave: I shall certainly do that. I noticed that Councillor Stringer also described the setting of the rate as a defeat for the Labour party. Since it was a victory for common sense, I suppose that he must be right.
    Mr. Litherland: Is the hon. Gentleman aware that as well as the 112,000 signatures on a petition that was left on the Downing street doorstep, there were 10,000 people on the streets of Manchester calling for jobs, services and democracy? The Minister must recognise this, because he has given us a guarantee that he will visit Manchester. Will he give a commitment to the House today that when he comes to Manchester — unlike Ministers before him, who shed crocodile tears and then went away and did nothing—he will have an open mind?
    Mr. Waldegrave: I think that many of my hon. Friends will regard the fact that Manchester received a 3·8 per cent. increase in its target and a 10 per cent. increase in its GRE as a rather generous settlement.

    Quarries (Development)
    Mr. Easthamasked the Secretary of State for the Environment what recent representations he has received regarding the implications of the House of Lords decision in the Hartshead Quarry case for the control of development in the vicinity of quarries.
    Mr. Macfarlane: I was sent copies of the report issued by the County Planning Officers Society on 14 November 1984 and the report issued by the Peak park joint planning board on 22 February 1985, both of which consider the implications of the Hartshead judgment. I have also received representations from the local authority associations. My hon. Friend the Member for Macclesfield (Mr. Winterton) tabled a parliamentary question on this subject, and I have received nine letters from right hon. and hon. Members since 22 February.
    Mr. Eastham: Does the Minister realise and recognise the very serious implications of this judgment for planning authorities? Has he been reminded of the fact that we now have a situation in which limestone and sand quarries, which have sometimes discontinued operations for 10 or 20 years, can decide to recommence operations and no longer require planning approval? There is often housing and other residential accommodation adjacent to those workings, creating very serious problems. Will the Minister seriously consider urgently introducing new legislation to control this?
    Mr. Macfarlane: I can set the hon. Gentleman's mind at rest, because when the remaining provisions of part I of the Town and Country Planning (Minerals) Act 1981 are introduced there will be a range of powers available to authorities. It will then be for them to decide which of these is most appropriate to any individual case. Each case, of course, must be considered on its planning merits. I refer the hon. Gentleman to the reply that I gave to my hon. Friend the Member for Macclesfield (Mr. Winterton) on 11 March. That sets out our intentions in parliamentary terms over the next few months.
    Mr. Nicholas Winterton: While I am very grateful to my hon. Friend for the additional information that he has given to the House on this important matter, and while he will appreciate, as I do, that quarrying is a vital employer in the Peak park and other such areas—and farming,
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    too, for that matter—does he agree that there is an anomaly in the present planning legislation relating to quarrying? This does not apply to anything else. Does he not think, therefore, that legislation is required to put this right?
    Mr. Macfarlane: I do not believe that any new legislation is required. I think that my answer to my hon. Friend earlier this month outlined the position. We have to accept that, following the House of Lords ruling, planning permission to extract minerals from the site remains available unless the Peak park joint planning board exercises its powers to make an order revoking that permission or that use of the land. I certainly take note of what my hon. Friend has said, but when these orders are laid later in this Session they will give the local authorities a range of powers. That was the intention of the 1981 Act. It was designed to introduce after-care and further provisos.

    Gleneagles Agreement (Private Clubs)
    Mr. John Carlisleasked the Secretary of State for the Environment whether he has discussed with the Association of District Councils the Gleneagles agreement and how it may affect the hiring of sports facilities to private clubs.
    Mr. Macfarlane: No, Sir.
    Mr. Carlisle: I am disappointed with that reply. Does my hon. Friend not think that he should discuss the matter with the Labour councils which are threatening to withdraw sports facilities from clubs just because some of their players have been to South Africa? Does he agree that the matter goes beyond the Gleneagles agreement and that if that policy were followed by Labour councils they would be at liberty to withdraw sports facilities from any team with members who are of a political colour different from their own?
    Mr. Macfarlane: The issue arouses deep passion on both sides of the House. It is for local authorities to decide how they will administer their sports facilities, and for the courts to decide whether their actions are unlawful. My locus in this respect is non-existent. The Court of Appeal has upheld the local authority's action as lawful within its duties under section 71 of the Race Relations Act 1976.
    Mr. Tom Clarke: In the various discussions, has the Minister's attention been drawn to the strong concern in Scotland about the rugby associations involving themselves in a world cup, despite South Africa being involved? Is the Minister not worried that the Commonwealth Games in Edinburgh might be jeopardised? Will he do more than he appears to be doing to protect the spirit of the Gleneagles agreement?
    Mr. Macfarlane: The House will be aware of the action that I took last year in relation to the rugby tour of South Africa. The House understands the Government's policy. Naturally, I am anxious to do everything that I can to ensure that all sports' governing bodies recognise our external obligations under the Gleneagles agreement. The Commonwealth Games in 1986 are important, not only for Britain, but for Commonwealth sport.
    Mr. John Browne: Notwithstanding the Minister's reply to my hon. Friend the Member for Luton, North (Mr. Carlisle), do not the Government have an absolute duty to

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    protect the freedom of individuals? If a local authority blatantly impinges upon the freedom of individuals because of their political beliefs, surely the Government must stand strongly behind those freedoms.
    Mr. Macfarlane: I endorse my hon. Friend's initial remarks, but it is not for the House of Commons to question a decision by the Court of Appeal.
    Mr. Denis Howell: Is it not time that the Rugby Union realised — as the judges have held in the case of the Leicester council and the Leicester rugby club —that public bodies are entitled to expect a more responsible attitude towards the Gleneagles agreement from people whom they finance? Since rugby received £175,000 last year from the Sports Council and public funds, what action will the Minister take to bring that home to the Rugby Union and to persuade it to act more responsibly in respect of South Africa?
    Mr. Macfarlane: We must ask ourselves the important question whether we want to stop coaching and rugby at junior level merely because the governing body decides to send a side to South Africa. I do not think that we should cut off the noses of some people to spite others. The money provided to develop and enhance rugby union at grass roots is a most important dimension. To cut that off would be a spiteful move for the future of rugby. We must try to educate the Rugby Union to have a wider concern for rugby throughout the world.

    Local Authorities (Tender Lists)
    Dr. Mawhinneyasked the Secretary of State for the Environment if he will introduce legislation to prevent local authorities from excluding on political grounds individual companies from tender lists for contracts for council projects.
    Mr. Patrick Jenkin: The consultation paper on competition in the provision of local authority services issued on 14 February proposes legislation to nullify the imposition of such irrelevant conditions in local authority contracts or invitations to tender. Subject to the consultation, it is proposed to legislate in the next Session of Parliament.
    Dr. Mawhinney: That is welcome news. Is my right hon. Friend aware that Labour and Liberal councillors on the Peterborough city council have combined to try to blackmail legal firms by threatening to prevent them contracting for city council business if they have done any work at RAF Molesworth—or even if they are willing to do such work? Is that not a disgraceful abuse of councillors' powers and counter to ratepayers' interests? Should that practice not be made illegal? How soon can we expect action?
    Mr. Jenkin: I agree with my hon. Friend that such conduct is totally unacceptable. That is why we have put our proposals out for consultation. I look forward to receiving my hon. Friend's support for the legislation in the next Session.
    Mr. Meadowcroft: Why do the Secretary of State and his Back-Bench colleagues always want to legislate when local politicians take a decision with which they disagree? Why do they not let local politicians defend such decisions at elections and let local electors make their choice of the policies that they support? Do the Secretary of State and
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    his Back-Bench colleagues act in this way because local Conservatives have no confidence in their campaigning ability?
    Mr. Jenkin: The hon. Gentleman's proposition is absolutely astonishing. Is the Liberal party defending what Peterborough council has done? If so, let us proclaim throughout the country that that is what we can expect if more Liberal councillors are elected next month.

    Asbestos
    Mr. Dubsasked the Secretary of State for the Environment what information he has as to the costs incurred by local authorities in removing asbestos from their buildings.
    The Parliamentary Under-Secretary of State for the Environment (Sir George Young): The joint central and local government working party on asbestos, set up by my Department last year, is at present seeking and collating information from the local authority associations on the scale of use of asbestos materials in buildings. This includes some information relating to the costs of removal of asbestos, but no national picture or overall estimate of costs is available.
    Mr. Dubs: Will the hon. Gentleman condemn Wandsworth council for taking legal action against two of my constituents, resulting in their incurring costs plus damages of nearly £9,000, when all they did was use legal action to delay for six days the demolition of Latchmere baths in my constituency because they feared that asbestos in that building would be a danger to local residents? Does the hon. Gentleman agree that such public-spirited action by my constituents — one of whom is now a local councillor—should be rewarded, rather than penalised by the threat of bankruptcy?
    Sir George Young: I would be very ill-advised to do what the hon. Gentleman invites me to do. The case was taken to court. The hon. Gentleman's constituents lost and Wandsworth won, and Wandsworth was awarded costs. It is not for Ministers to comment on that decision.
    Mr. Chapman: As a curtain-raiser to an important Adjournment debate tomorrow, will my hon. Friend use his good offices to encourage local authorities to adopt the recently invented process of the vitrification of asbestos waste which, apart from removing the toxicity of the waste completely and therefore preventing health hazards, has the financial merit of being able to be undertaken in some cases at half the conventional cost of bagging and dumping the waste?
    Sir George Young: I am sorry to say that I shall not be participating in the Adjournment debate tomorrow. My hon. Friend the Under-Secretary of State — the hon. Member for Bristol, West (Mr. Waldegrave)—whose happy task that will be has heard my hon. Friend's remarks, and I know that his remarks will embrace the response to those proposals.

    Basildon (Rates)
    Mr. Proctorasked the Secretary of State for the Environment what representations he has received from Basildon district council, following the setting by the council of a legal rate; and if he will make a statement.
    Mr. Kenneth Baker: I welcome Basildon's decision to fix a legal rate. No representations have been received consequent on that decision.
    Mr. Proctor: Is my right hon. Friend aware that Basildon district council proposes to close Billericay swimming pool from 7 May and that rate capping is the reason that the council gives for its action? Is my right hon. Friend aware also that the documents leaked to me from the management team of Basildon district council—a copy of which I gave to my right hon. Friend last night—make it clear that rate capping is not involved in the decision and that the same saving of £100,000 a year would have been achieved by cancelling the contract with Union Communications to handle the public relations for the council against the Government?
    Mr. Baker: I thank my hon. Friend for letting me see those documents, because they show that the council's policy—
    Mr. Denis Howell rose—
    Mr. Baker: —wait for it. They show that the council's policy is to favour the areas regarded by the present Administration as having the greatest social need. What has the council done to implement that policy? It has cut out a recreational service but has gone on paying £100,000 to an advertising firm to conduct a campaign against Government policies. I hope that Basildon residents and ratepayers will recognise the cynicism of that decision.

    Royal Commission on Environmental Pollution (Recommendations)
    Mr. Campbell-Savoursasked the Secretary of State for the Environment what recommendations of the Royal Commission on environmental pollution have been acted upon by the Government.
    Mr. Waldegrave: Since 1979 the Government have published positive responses to the recommendations contained in five Royal Commission reports, and set in hand follow-up action as appropriate.
    Mr. Campbell-Savours: Why do the Government not stop equivocating and sign the Ottawa declaration on acid rain?
    Mr. Waldegrave: In the answer to the tenth Royal Commission report, the Government have taken the trouble to set out the reasons why they did not want to do that, and I know that the hon. Gentleman is very familiar with the arguments in that response.
    Mr. Gale: Will my hon. Friend confirm his opinion of the commission's findings on the efficacy of long sea outfall?
    Mr. Waldegrave: As my hon. Friend is aware, the Government have also responded to that matter in their answer to the tenth Royal Commission report. I refer him to that response, over which a great deal of trouble was taken.
    Dr. David Clark: As the Minister said in a television interview about Britain joining the 30 per cent. club:
    "If you want my opinion, I would have taken the risk of joining the 30 per cent. club",
    may I ask what is stopping him?
    Mr. Waldegrave: The hon. Gentleman did not quote me fully. I said that that would have been an easy thing to do as a number of other countries have done it knowing perfectly well that they would do nothing about it. That is not how Britain approaches these matters, and I am proud of that.
    Mr. Tony Lloyd: On a point of order arising out of Question Time, Mr. Speaker. Do you accept that the people of Manchester will be very disappointed at the limited number of supplementary questions taken on a very important series of questions when compared with—
    Mr. Speaker: Order. The problem with Question Time is that although I do try to call as many hon. Members as possible, when an area has a number of Members representing it it is impossible to call all of them. Every time that Front Bench speakers rise—and they rose eight times today—it makes it more difficult for me to call Back Benchers.

Employment, Education and Training
3.31 pm
The Secretary of State for Employment (Mr. Tom King): With permission, Mr. Speaker, I wish to make a statement on employment and training.
Last Thursday I published the White Paper "Employment: The Challenge for the Nation". Today, in conjunction with my right hon. Friends the Secretary of State for Education and Science and the Minister without Portfolio, I am publishing a further White Paper, entitled "Education and Training for Young People".
The purpose of the first White Paper is to set out the facts and figures on the present employment situation and to describe the strategy that the Government believe offers the best prospects for employment, with the steps already taken and the further measures proposed.
There are three key elements in the Government's strategy towards employment. First, the Government must create an economic, financial and industrial climate in which enterprise can flourish. The priority is to control inflation. Without that, there is no prospect that industry and commerce will compete successfully, raise output and create jobs. Secondly, the Government can help improve the labour market by encouraging more and better training and by removing obstacles which hamper employers taking on workers. Finally, the Government can provide direct help for those worst affected by unemployment through, for example, the community programme.
The second White Paper, "Education and Training for Young People", deals with a key element in our strategy for employment — the reform of our education and training policies and programmes. It outlines our approach to work-related education and training for 14 to 18-year-olds and emphasises the need to develop more comprehensive and coherent provision for this age group.
Improvements in education and training are crucial to strengthening the economy. Only then will industry and commerce be able to find the skills they need if they are to become more competitive. Efforts to get a better trained work force must be directed at everyone in it, irrespective of age or occupation. But, in particular, we must ensure that our young people are properly prepared for the world of work. We intend to build on the success of recent achievements by taking action in three particular fields: introducing new arrangements for in-service teacher training related to the technical and vocational education initiative, setting up a review of vocational qualifications and bringing in a new two-year youth training scheme. These actions flow from the review of provision for 14 to 18-year-olds carried out by the Minister without Portfolio.
As regards the youth training scheme, the Government are providing substantial additional resources so that, from April 1986, we are able to offer a second year of training to 16-year-old school leavers and a one-year place to 17-year-old school leavers. Our aim is that all our young people leaving school will have the chance to get vocational qualifications. The Manpower Services Commission has warmly and unanimously welcomed these proposals and has now put in hand the necessary consultations, with a view to reporting back to me by the end of June.
The new training scheme, together with the parallel changes in education and the review of vocational nal qualifications, will help to put vocational education and
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training for our young people on a par with that of our main competitors overseas, and will help create a more flexible labour force and more competitive economy.
Taken together, these two White Papers set out clearly the Government's strategy for employment and give the details of the new proposals for improving vocational education and training in this country, which I hope will command the support of the whole House.
Mr. John Prescott: I noted with interest that the Secretary of State did not predict the increase in employment that might result from the two White Papers with which he dealt. These two documents are a reflection of the increasing public concern that exists about the growing mass unemployment in Britain and particularly about the plight of those who make up the unskilled labour force, who are suffering after six years of Conservative policies.
There is a startling difference between the two White Papers. In describing the training requirements embodied in "Education and Training for Young People", the Government recognise that they have a responsibility to intervene to ensure that there is adequate training and proper planning for training. It is clear that the Government have a direct responsibility to achieve those goals, at a time when British industry has failed to make either a financial or physical contribution to improving the skill of the nation's labour force.
That is particularly true when we compare this country with our international competitors. The concern in Britain seems to be more for training to be a business cost than an investment.
The Government stand indicted for the way in which they have dealt with the problem—that is, by their philosophy of trying to justify the abolition of 16 of the 23 industrial training boards and, more recently, 29 skillcentres, on grounds of cost. We require planning adequate to meet the training requirements of the nation and the resources from industry.
YTS schemes are to be extended to two years. We on the Labour Benches have campaigned for that for a long time, so it is a step that we welcome. Indeed, such an extension was part of our manifesto. I particularly welcome the announcement in the White Paper of the review that is to be conducted by the Secretary of State into many of the criticisms that Opposition Members have made of many existing YTS schemes.
As the Secretary of State is now considering some of those criticisms, may I ask him to confirm that the new two-year scheme will not be compulsory? Is he considering giving a proper wage to trainees, which in real terms would now be equivalent to £38—£10 or £11 more than is currently paid? Many of those now on YTS schemes regard the present rates as slave labour pay. Is the right hon. Gentleman also reviewing the health and safety conditions and the monitoring of schemes by area boards? It would be appropriate if he reported back to the House on those matters, in time for the debate when he has received the report mentioned in the White Paper.
Will the right hon. Gentleman elaborate on what is said in the White Paper about a preference for employer-based schemes in the second year? That seems to underrate the contribution that local authorities have made to some excellent YTS schemes, and I hope that he does not intend to reduce their role.

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Will the Secretary of State reconsider his decision to close 29 skillcentres? Will he postpone their closure in view of the fact that for second-year YTS schemes, which will come into effect in 1986, skillcentres would be ideal places to use for that second stage, offering good opportunities for quality training.
The White Paper "Employment: The Challenge for the Nation" has failed miserably, as did the "Budget for jobs", in trying to convince people that the policy was designed to secure more jobs for the additional members of the skilled labour force that the Government hoped would be created. The Government reaffirm their belief in the free market and blame everybody for the problems of mass unemployment, which in fact has been caused directly by Government policies.
The White Paper contains some statements which we readily accept and confirms the Labour party's record on producing jobs during its five year of office. For every one extra job it produced, the Tory Government have lost six during five years of their policies. It is a deplorable document because, as with training, it refuses to accept that employment is a responsibility of Government. It compares most unfavourably with the 1944 White Paper, which fully accepted that Government had a responsibility not only for employment, but to observe their international obligations, which were embodied in the wages councils, the abolition of which is proposed in the White Paper.
This is a deplorable White Paper. It does little for employment, and the Government wash their hands of their responsibilities, and do little to reduce the mass unemployment that continues to increase. The White Paper confirms that the Government's policies are deliberately creating mass unemployment. If the Government believe that they can do nothing about it, they should resign and make way for a Labour Government who will reduce unemployment.
Mr. King: It is difficult for the hon. Gentleman to sustain the charge that the Government are washing their hands of the problem when during the past week we have introduced two White Papers, which deal specifically with some of those issues. I would have hoped for a more positive response from the Leader of the Opposition and his hon. Friends. [Interruption.] It contrasts noticeably —because of the noise from Opposition Members, the hon. Gentleman may not have heard this — with the warm and unanimous response from the Manpower Services Commission, which includes representatives of industrialists and the Trade Union Congress. They have confirmed their support for our expansion of the opportunities in youth training.
I confirm that the scheme will continue to be voluntary, that we intend to maintain a trainee allowance, and that we do not intend to make the sort of substantial increase in costs that the hon. Gentleman suggested—for one good reason. It is genuinely important to ensure that the maximum resources go into training and that we get the highest possible quality of training. When I am faced with a choice of priorities, I am more anxious to maintain a reasonable level of trainee allowance and a high quality scheme, than to make a much higher level of trainee allowance, which might be at the expense of the quality of the training.
The hon. Gentleman asked about skillcentres. He will know that part of the way in which we can ensure modernisation of our skill resources is to ensure that we
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put those resources to the most effective use, not into the maintenance of bricks and mortar for under-utilised assets in a facility which is not fully used.
"Britain will only be able to produce the goods and services of the future if those who work in industry are trained in the skills of the future."
The Leader of the Opposition happened to raise his head at that, but that is a quotation with which I agree. It also happens to be the policy that we have been putting forward.
The hon. Gentleman asked about the forecast. I have looked hard through "Labour's Jobs and industry Campaign", but I cannot find many forecasts — and rightly so. [Interruption.] Well, I cannot find it in the document, which was shrewdly drafted. As we made clear in the statement, we seek to achieve the best possible prospects for employment. The measures that we have announced in the two White Papers will help significantly towards that.
Mr. Mark Carlisle: I welcome whole-heartedly the statement of my right hon. Friend, and the great emphasis placed on training for young people. Does he agree that we have been well behind our European competitors in this area? Does he agree that the actions of the Government since 1979 stand in strong contrast to the complete lack of action by the Labour party when it was in Government? Does he further agree that the reaction by the hon. Member for Kingston upon Hull, East (Mr. Prescott) to the statement is the only matter that could appropriately be called "deplorable"? Does he further agree that it is vital to retain close links between schools and industry, and that we should put great importance on the vocational training of those who choose to stay on in sixth forms but do not intend to take A-level courses?
Mr. King: I am grateful to my right hon. and learned Friend. With his great knowledge of the subject, he will understand the importance of these issues. It is unfortunate that the hon. Member for Kingston upon Hull, East (Mr. Prescott) was so grudging in his comments. All that the Labour party could manage was the youth opportunities programme. There is not much argument in the House that the YTS is a vast improvement on that. I am proud that we launched it. I am even prouder that we can announce this extension to it. I am grateful for what my right hon. and learned Friend said about the link between education and training. The fact that my right hon. Friends the Secretary of State for Education and Science and the Minister without Portfolio have worked so closely on this makes it clear that we see the vital need to ensure the closest possible link so that we genuinely meet the different needs of youngsters by vocational as well as more formal academic education. I believe that the announcements are a major step in that direction.
Mr. David Penhaligon: The Minister, admittedly under the spur of desperation, is gradually putting together a package for education and training which at least has some potential. What will he do to persuade or perhaps coerce employers to face up to their social responsibilities by making the investment in their future employees that most European employers make? Furthermore, the White Paper boasts that 60 per cent. of those leaving YTS obtained a job. Some people dispute that figure, but I will accept it. What are the Government's plans for the other 40 per cent?
Mr. King: I thank the hon. Member, albeit for his somewhat half-hearted welcome for what we are doing. It would be wrong to criticise all employers. Many employers make a substantial contribution, but on average the contribution from British employers is less than that in Germany. That is one of the major challenges contained in both White Papers. I am encouraged by the president of the CBI, who has made clear his determination to see that the CBI plays a positive role in this. While I cannot give the hon. Member exact details of how we will achieve it, I am optimistic that we shall start to improve the take-up rate of permanent jobs which for many of the youth training schemes is in excess of 95 per cent.—although the average, as he rightly says, is something over 60 per cent. We are anxious to see that figure raised at the earliest possible opportunity.
Sir Philip Goodhart: In his first welcome White Paper, my right hon. Friend referred to the contribution to the greater flexibility of patterns of work that can be made by young workers. The private sector has been much more helpful than the public sector. Can my right hon. Friend promise any action to make the public sector more imaginative and flexible?
Mr. King: I am interested in the point that my hon. Friend makes. Events in the postal service have brought to the public notice overtime and flexibility and how additional jobs might be created. I do not say this critically, because it is one of the issues that we are considering, but at the moment, something over 11 million hours of overtime a week are being worked. A substantial amount of employment is contained within that overtime if it were possible to reorganise it. It behoves us all to try. I shall be studying the public sector to see whether it can make a contribution with experiments in more flexible working.
Mr. Tony Benn: Is the right hon. Gentleman aware that, for tens and tens of thousands of young people on YTS, 40 per cent. of whom will not obtain employment as the result of the scheme, the Government's motives are seen to be different from the ones that he put to the House? They are seen as being to take people off the register, to provide free labour for employers, to lower wages, to substitute for adult employees, and to by-pass trade unions and the health and safety regulations. Young people want real training and jobs. His statement means that the Government contemplate low wages in a permanently high mass unemployment society.
Mr. King: One reason why some young people may hold that view about YTS is that the right hon. Member for Chesterfield (Mr. Benn) and some of his hon. Friends choose to keep telling them so. I am glad to say that their views are those of a substantial minority in the country, and I am grateful for the fact that neither the Opposition Front Bench nor the responsible trade union leaders share them.
Sir John Biggs-Davison: Does my right hon. Friend remember the prophecies of the right hon. Member for Chesterfield (Mr. Benn) about the Falklands war and the miners' strike? The right hon. Gentleman is now making prophecies about employment.
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My right hon. Friend speaks about the contribution of the CBI. Does he have anything to tell us about the decline of apprenticeships in this country, and does he have anything in mind in that regard?
Mr. King: Part of the change in apprenticeship has resulted from changes in manufacturing industry. A number of employers regard the apprenticeship route as less relevant to the new technologies. One very important aspect of the review of qualifications is the question how we can arrive at a more comprehensible and appropriate system of qualifications that will perhaps incorporate apprenticeship as well. At the moment, many youth training schemes are running parallel with apprenticeship schemes. There is certainly a need for rationalisation.
Mr. Ron Leighton: In his statement, the Secretary of State told us that the Government intend to devote substantial new resources to the second year of the YTS. I do not believe that that is really true. The figure for the first year was just over £100 million and for the second year it is £300 million. Those figures are derisory. When the right hon. Gentleman first talked about year one of the YTS, he used to speak of providing £1 billion. Now that we have reached year two, instead of speaking of another billion pounds, the right hon. Gentleman wants to have two years of YTS for £1 billion. That is not sufficient. Last week the Select Committee took evidence from the CBI. The YTS is a voluntary scheme — voluntary for employers too. The employers were very worried about the very small sums of money being provided by the Government.
The Government can spend billions of pounds on fighting the miners, and billions on the Falkland Islands. We want billions of pounds to be spent on educating Britain's younger generation. A realistic allowance must be made, to guard against charges of cheap labour. The right hon. Gentleman must do the job properly. He is not devoting sufficient resources to it.
Mr. King: The House will note that the hon. Gentleman describes as derisory the sum of £1·1 billion, the amount that we propose to devote to the youth training scheme when it is running. The hon. Gentleman says that he has received evidence that some employers may be concerned about the contribution that they have to make. That is exactly the point that was made by the hon. Member for Truro (Mr. Penhaligon). Of course difficult decisions have to take place. We must ensure that people understand the importance of the matter. I hope that the hon. Gentleman and his hon. Friends will support us in ensuring that they do.
Mr. Richard Tracey: Will my right hon. friend consider the idea of including in the training some course in basic economics? If it was pointed out that jobs are produced by customers, markets and competitive service and not by Governments, young people would not grow up to share the tunnel vision from which the Opposition suffer.
Mr. King: Almost the most unpleasant aspect of the campaign being launched by the Labour party is a postcard bearing the slogan "Gissa job". To suggest that jobs are in the gift of Governments, without any contribution or effort on the part of the person concerned, is to encourage the worst possible attitude. The Government have a clear responsibility, but we will not succeed unless our

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contribution and responsibility are matched by the determination of the individual himself—for instance, to train in order to improve his qualifications—and by a contribution from the whole of industry.
Mr. Eric S. Heifer: In relation to basic economics, what does the right hon Gentleman have in mind—will he insist on Pigou Keynes, Adam Smith, Ricardo, Karl Marx or Marshall? How many real jobs will we get on Merseyside as a result of this scheme? How many people will be taken into training on decent incomes —or, as some people are suggesting, is the Secretary of State all bark and no bite?
Mr. King: That is the most extraordinary supplementary question to be asked the day after the Labour party produced a paper which carefully avoided saying how many jobs Labour's policies would provide on Merseyside. The expansion and development of YTS will enormously improve the chance of young people to equip themselves for work, including some who need it most. The expansion of the community programme will significantly help a number of the long-term unemployed. The growth in the economy is now at last creating more jobs. Those factors offer a better prospect than we have had for a long time for employment in Merseyside and elsewhere.
Mr. Tony Baldry: Does my right hon. Friend agree that, in regard to adult training, what matters is not whether the building is called a skillcentre, a technical college or a college of further education, but the quality, quantity and cost-effectiveness of the training? Does he further agree that, unless British employers start to take the lead in training, British industry will follow behind our competitors?
Mr. King: I know, as will the House, the close interest that my hon. Friend takes in these matters. He is correct. We must ensure that resources are used as effectively as possible. That is true whoever is responsible for these matters. Resources must be used effectively in a rapidly changing world of skills. We must also ensure that everyone understands the importance of investment in training for the future.
Mr. Derek Foster: Will the Secretary of State now admit that, in areas such as the north-east, placement in work of youngsters after YTS is not the 60 per cent., 70 per cent or 95 per cent. that he mentioned, but only 33⅓ per cent? No wonder they grow cynical about his scheme. Will he also admit that, until employers contribute to the scheme as has been suggested, there is no chance of it succeeding? The careers service in County Durham is deeply sceptical that employers are capable of making the type of response that the right hon. Gentleman will need.
Mr. King: A couple of times in the past month I have been close to some of the places that the hon. Gentleman has described. I have seen the difficult problems in the north-east. There is no wand to be waved, and anyone who pretends that there is is committing a cruel deceit. I believe —and I hope the hon. Gentleman will ensure—that, in the hon. Gentleman's constituency, young people realise that, in spite of the hostile and thoroughly unhelpful propaganda that some choose to put about, YTS offers a good opportunity to get a start. No, I cannot guarantee everybody a job at the end of the scheme, but I can
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guarantee, as is evidenced in the north-east, that young people have twice as good a prospect of a job if they have been on YTS.
Mr. Spencer Batiste: Does my right hon. Friend agree that his excellent proposals for the extension of YTS could be more effective still if the scheme could build on a more broadly based framework of vocational training in schools?
Mr. King: Our exchanges have tended to concentrate on YTS, but the development of the imaginative technical and vocational education initiative is extremely important. Those who have had a chance to see these new courses in action realise that they are a major change and are here to stay.
Mr. George Foulkes: On the second White Paper, the Secretary of State mentioned "this country". Can he confirm that that means Great Britain? He also mentioned consultation with the Secretary of State for Education and Science and the Minister without Portfolio. How was the Secretary of State for Scotland consulted in the preparation of the White Paper? Is any separate statement being made on the implications for Scotland, especially the Scottish education system, which, as he knows, is different from that south of the border?
Mr. King: The hon. Member will find the references. The situation is different. In this case, the proposals are in an England and Wales context because of the differences in the Scottish educational system. The hon. Member knows better than I the differences in relation to integration and qualification. However, the first White Paper, on employment, to which I referred covers the whole of Great Britain.
Mr. Patrick Nicholls: In welcoming the proposals that my right hon. Friend has set out today, may I urge him to reject emphatically the suggestion made by the hon. Member for Kingston upon Hull, East (Mr. Prescott) that the allowance paid to somebody who is undergoing training should be the same as the wage that is paid to a person who is doing a job of work? Will he agree with me that, whatever the situation may be today, the decline in traditional apprenticeships began precisely because the trade union movement insisted upon narrowing the gap between the wages paid to apprentices and those paid to working men, which meant that it was no longer worth while for employers to invest in that type of training?
Mr. King: My hon. Friend is quite correct. As we are quoting international comparisons, one of the very striking differences is the difference between what is expected by those under 18 in this country and what they expect in such countries as Germany, where there is a much greater acceptance of the training allowance approach. It is highly significant that there is a great deal more training in Germany.
Mr. Robert Kilroy-Silk: Does the Secretary of State not yet know that those who are most hostile to youth training schemes are the young people who have been on them, as the Prime Minister found out last Tuesday? May I remind the Secretary of State that on the very day that those 25 unemployed young people from my constituency visited the Prime Minister, there were no more than 10 vacancies for young people in the entire town

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of Kirkby? As a result of this statement and two White Papers, how many new jobs will be created? Will the prospects for those young people continue to be blighted and destroyed? Never mind the 10,500 people who are unemployed in my constituency; when will the 25 who visited the Prime Minister last week get real, full-time jobs?
Mr. King: Many of the criticisms made of the youth training scheme by those who have been on it, and in a major article in a national newspaper, refer not to the youth training scheme at all but to the youth opportunities programme, which was started by the hon. Member and his hon. Friends. Overwhelmingly, however, the comments about YTS are favourable. They are not universally so, and it is a problem that the scheme does not always lead to full-time employment but instead to disillusion. All I know is that these measures, including those for youngsters who have been on YTS and who are now over 18, and the expansion of the community programme, including the training component, will help them at this difficult time. Of course they would prefer full-time jobs, but the whole House knows that this country, like the other countries in western Europe, is facing a serious problem of high unemployment.
Mr. Kenneth Carlisle: It is important that both White Papers reflect the reality that in the end jobs depend upon supplying what the customer wants. In particular, will my right hon. Friend accept that it is very welcome that the youth training scheme is being developed into a second year, which will be particularly helpful to school leavers. Will my right hon. Friend ensure that the youth training scheme is dovetailed into the present apprenticeship scheme?
Mr. King: The review of qualifications, which may have sounded to other hon. Members like a less interesting item, will, when they have read the White Paper and had a chance to see what is involved, be seen to be of fundamental significance. It is vital that we should put into operation the rationalisation of apprenticeships, together with the other training schemes. It is one of the objectives that we have in mind.
Mr. Gordon Wilson: When will the Secretary of State realise that, without a policy of economic expansion, the two White Papers he has published constitute two legs of a three-legged stool? Secondly, will he give special help to those areas which have been the victims of industrial devastation over the last few years, where the skill base may have been diluted, in order to make sure that youngsters get the skills which are applicable to work?
Mr. King: Of course I accept what the hon. Gentleman says about the need for a strong and expanding economy. He will find that it is a central plank of the White Paper we have just published. This country is now embarking upon a fifth year of economic growth. It is likely to have the highest growth rate of any country in Europe. This country is likely to be the fastest creator of new jobs of any major country in western Europe. Of course that is the main platform upon which we have to build the expansion of employment opportunities in this country. I hope that the hon. Gentleman understands that I fully recognise its importance.
Mr. Conal Gregory: Will my right hon. Friend examine after Easter, in the light of the forthcoming review of the wages councils, the overtime aspect? There has been the prospect this week of an industrial dispute in the Post Office. Is it not both immoral and uneconomic for people to work long-term overtime rather than cyclical overtime? Will my right hon. Friend examine this aspect in conjunction with his right hon. Friend the Chancellor of the Exchequer so that we may enter an area of real job creation?
Mr. King: I am grateful to my hon. Friend. I think the whole House knows what a sensitive and difficult area this is. However, I gave the figures to the House earlier. It amounts to about 11·5 million hours a week, which is the equivalent of 600,000 full-time jobs. I know that it is not possible to make a straight conversion, but, in terms of part-time job release and the way in which we can work towards job-splitting schemes and the incorporation of regular overtime into those schemes, we may be able to find a way in which those who are in work contribute towards helping those who are without work.
Mr. Max Madden: Does the Secretary of State understand that many young people remain very suspicious of YTS? They believe that it is a cheap labour scheme, often with indifferent training being given, and that it is riddled with racial discrimination. Will the Secretary of State give a firm undertaking that he will never seek to make YTS compulsory? Will he also give a specific assurance that trainees in their second year will be given an increased allowance?
Mr. King: It is precisely that sort of comment, delivered in this House and then fed around the country, which has destroyed the opportunities for many young people. Last year, 20,000 young people who would have had the chance of training and work experience in good schemes which would have led to much better prospects of employment were put off by the comments of those who tried to score cheap political points. I have nothing but contempt for them.
Mr. Patrick Thompson: I join those both inside and outside the House who will welcome this statement as evidence of the Government's increasing commitment to training as the one sure way to increase opportunities for our young people. Does my right hon. Friend agree that we are falling behind our competitors in information technology? Will he ask his right hon. Friend the Secretary of State for Trade and Industry to persuade industry and commerce to make a greater commitment to information technology, through greater use and greater training?
Mr. King: One thing that strikes me about company reports of their financial affairs in their balance sheets and reports and accounts is that, although they depreciate their plant, machinery and buildings, it would be an excellent innovation if they depreciated the most important part of any business—the quality of the skills of their work force. I hope my hon. Friend understands that the work force is a vital investment. If it has been important in the past, it will become absolutely critical in the future because of the galloping pace of new technology.
Mrs. Ann Clwyd: The Minister is quite right. We have seen growth in Wales during the last six years—growth in long-term unemployment, from 27

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per cent. in 1979 to 40 per cent. now. What does the Minister intend to do about it? Do the Government recognise the link between unemployment and health? According to medical research, thousands of people have died unnecessarily because of the Government's policy of creating unemployment. Does the Minister recognise that social factors are also linked to unemployment: that the rise in marital break-ups, in suicides and in child battering are the direct result of the policies of this Government? What does he propose to do about this?
Mr. King: In our assessment of the present position, the greatest areas of concern are clearly the prospects for young people and the long-term unemployed. For that reason, and because of the tragic human problems that accompany unemployment, especially long-term unemployment, the extension of training for young people and the doubling of adult training provision with more help for the long-term unemployed are the two central planks of the measures that I have announced.
Mr. Peter Thurnham: I welcome both White Papers. Does my right hon. Friend agree that they contrast strongly with "Labour's Jobs and Industry Campaign" which would restrict outward investment — although Japan, which has one of the lowest rates of unemployment and one of the most dynamic economies in the world, is now also the world's largest exporter of capital?
Mr. King: I do not wish at this stage to go into the fallacies and paradoxes of that document, which will no doubt engage us at a later date. In this country we live by our trade, which is a vital component in the success and strength of our economy. Our exports are expanding fast and if there is one thing we need like a hole in the head it is import controls.
Mr. Kevin Barron: Is the Secretary of State aware that the majority of young people leaving school or coming off the youth training scheme in my constituency still cannot find jobs and will regard with scepticism statements emanating from a Government whose only claim to fame is that for every week in office they have added 1,000 people to the dole queue?
Mr. King: I wonder how much that kind of effort really helps young people in the hon. Gentleman's constituency to find jobs. The hon. Gentleman might have used his breath to better effect in pointing out to them the opportunities that will come from expansion of the youth training scheme and in encouraging as many of them as possible to take those opportunities.
Mr. Tim Yeo: Is my right hon. Friend aware that the voluntary sector is keen to play a full part in the drive against unemployment and that any steps that he can take to encourage the participation of voluntary organisations in the expanded community programme will be warmly welcomed?
Mr. King: I am most grateful to my hon. Friend. I referred to that aspect in my speech in the Budget debate. I certainly hope that it will be possible to try some imaginative approaches to ways in which charities and the voluntary sector might be able to co-operate in the community programme in ways not so far possible. I believe that that could be a great help, especially for the long-term unemployed.
Mr. Dave Nellist: Is the right hon. Gentleman aware that his belated statement on unemployment today, combined with the recent statement of the Minister without Portfolio, Lord UB40, and the Chancellor's Budget statement are clear evidence of the Government's Elastoplast approach to youth unemployment. The net cost of the £1,000 million allocated to these measures in the Budget is only £75 million when dole and supplementary benefit savings are deducted. Is that not clear evidence of the Tory policy of industrial conscription and reduced wages for young people through the YTS, when my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) has correctly pointed out that the allowance should be £38 per week to keep pace with the increase in the retail price index in the past seven years, or £40 per week to keep up with wages?
Finally, in the document on employment issued last week the Secretary of State asserted that young people were pricing themselves out of jobs. Does he not recognise that since the Tories came to office school leavers' wages have fallen relative to adult wages by 8 per cent. for boys and 12 per cent. for girls while youth unemployment has trebled? Where is the connection between wages and allowances for young people and that rocketing rate of unemployment?
Mr. King: The answer to the hon. Gentleman's first question is no, Sir. The answer to his second question is also no, Sir.
Mr. Nellist: That is absolutely pathetic.
Mr. Speaker: Order.
Mr. Peter Bruinvels: Despite the sniping and carping of the Opposition spokesman on employment, may I say on behalf of my hon. Friends and the country that we welcome my right hon. Friend's announcement as providng real hope for the youth of today? Will he confirm that all careers teachers will be properly trained to encourage young people to go into the youth training scheme and not to regard it as a stigma as the scheme provides real hope for them, in contrast to the Labour party's "gissa job" policy which everyone is expected to pay for and from which no one will benefit in terms of lasting employment?
Mr. King: I am grateful to my hon. Friend for his positive approach. The trouble with Labour Members is that they get hung up between claiming that something is really their own policy and taking every opportunity to snipe at developments which in their more rational moments they should agree constitute a major step forward for which many people in the House have called for a long time and which could offer much better prospects for young people and the long-term unemployed.
Mr. Barry Sheerman: Is it not lime that the Secretary of State went back to school and learnt something about the three Rs — rhetoric, reality and resources — and the difference between them? The rhetoric of the White Paper talks of investment in training and coherence in education and training provision but in reality the Government have dismantled the national training system and the industrial training boards, cut back the skillcentres and destroyed the apprenticeship system so that there is now less adult provision and less high quality training for young people than there was in 1979?

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Is the right hon. Gentleman further aware that the emerging problem of skill shortages is of the Government's own making and that despite the rhetoric about skills and qualifications for young people the reality is that the Government are preparing young people for low-tech and no-tech jobs with low skills and a low-waged future?
Is the right hon. Gentleman also aware—
Hon. Members: Too long.
Mr. Speaker: Order. It is for me to say things like that.
Mr. Sheerman: The right hon. Gentleman talks about coherent provision, but are not the 16 to 19-year-olds, the A-level and higher education students, also entitled to coherence, or is he intent on reintroducing the 11-plus by the back door so that the GCSE will be the new 11-plus, dividing quality education for some from low-tech, low-skill education for others?
Mr. King: In the kindest possible way, I must tell the hon. Gentleman that that was a most extraordinary collection of comments. As I still had some faith in the hon. Gentleman, I hoped that he might be able, albeit grudgingly, to express on behalf of the Opposition a warm welcome for this measure. I am sorry that he was not able to do so, but I hope that in the fulness of time the merits of my announcements will be recognised.
Mr. Nellist: On a point of order, Mr. Speaker. As I understand the procedures of the House, it is usual to apply before lunch for an emergency debate. I seek your guidance on whether it is possible for me to apply now for an emergency debate on youth unemployment in view of the pathetic answers given by the Secretary of State for unemployment and the cavalier way in which he has treated serious criticisms of his statement. The support that the Secretary of State received from Conservative Members for the answers that he has given—people for whom one job and one income is insufficient—and his statement to youngsters on £26·25 a week that they are pricing themselves out of jobs, demand that the House today set aside all other business to discuss fully the statement and the documents which the Secretary of State for Employment has just introduced.
Mr. Speaker: It is not possible for the hon. Gentleman to make a Standing Order No. 10 application today on this matter. The White Paper was published, I think, two or three days ago.
Mr. Nellist: What has that to do with it?
Mr. Speaker: The hon. Gentleman will have to find other opportunities to seek to debate the matter, which I am sure will occur.

Early-Day Motions
4.20 pm
Mr. Nicholas Soames: On a point of order, Mr. Speaker. I wish to raise a point of order on an altogether more esoteric subject than that of the hon. Member for Coventry, South-East (Mr. Nellist). You will have seen on the court page of The Times today, at the head of the list of birthdays being celebrated this day, the announcement of the 60th birthday of the right hon. Member for Chesterfield (Mr. Benn).
Last night I tried to table an early-day motion pointing out the significance of this event, and particularly highlighting the outstanding loyalty and unswerving devotion to the cause of his party and to his Leader that he has evidenced recently. The Clerk refused to accept the early-day motion on the grounds that it was tendered in a spirit of mockery. [Interruption.] It was not tendered in a spirit of mockery. I am not suggesting that the Officers of the House should in any way be making a judgment about the right hon. Gentleman's loyalty, but how would it be possible for the whole House to celebrate, as it would wish, this great moment and to express its satisfaction and gratification that this important milestone should have been reached?
Mr. Dave Nellist: On a point of order, Mr. Speaker.
Mr. Speaker: Well, we have a very busy day.
Mr. Nellist: On a point of order, Mr. Speaker. Is it not an abuse of procedures of the House that on a day on which a statement has been made purporting to deal with the question of youth unemployment in the country the matter should be so trivialised by that rubbish over there?
Mr. Speaker: It is very nearly Easter.
The reason why the early-day motion of the hon. Member for Crawley (Mr. Soames) was declined was that it was tendered in what was judged to be a spirit of mockery and, as the hon. Gentleman knows, that is not part of our conventions. I am sure that he will find other methods of celebrating this great occasion.

Colliery Closures
4.22 pm
Mr. Ray Powell: I hope to bring the House back to some sort of sanity by making a Standing Order No. 10 application.
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 announced decision of the National Coal Board to close certain collieries in south Wales and elsewhere."
I appreciate that I have first to convince you, Mr. Speaker, that the matter raised is specific, important and urgent, and that you tend to assist Back Benchers with a problem. It is, therefore, with a great deal of optimism that I ask you to grant the application. You are only too well aware of the 13 months of arguments on the colliery closure issue during the miners' strike, and so will know that the matter is undoubtedly specific.
On the issue of importance, again you have heard the multifarious arguments for and against, and so will know the importance of the matter. The fight was not for wages, holidays or any other advantages of that nature, but for jobs and communities, and the importance of the decision by the NCB to close collieries cannot be stressed too strongly.
In my constituency of Ogmore, the colliery suggested for immediate closure is the St. John's colliery in Maesteg. It employs 869 colliers, and is the last pit in the Llynfi valley. If the pit is closed, the male unemployment rate in Maesteg will escalate to some 45 to 50 per cent. It is 24 per cent. already, with a community population of some 24,000.
Another colliery in my constituency which is under close scrutiny and consideration for closure is the Garw colliery in the Garw valley, employing 650 miners. That colliery is the last one in the Garw valley.
I stress the urgency because of my experience when I made an application under Standing Order No. 9, as it then was, regarding the closure of the Wyndham western colliery, which, incidentally, was the last pit in the Ogmore valley. My request was made prior to the Christmas recess and, before the House returned, the colliery was closed on 7 January. This was done without negotiated agreements, agreed procedures and consultations that we are informed should take place. That is similar to what has happened in recent days in the Bedwas colliery in Caerphilly.
Therefore, it is without reservation that I stress the urgency of the need for the House to be afforded time to debate this issue. Knowing the attitude of the NCB chairman—the cuckoo in the nest for the Government—I would not feel safe eating my Easter egg in the short recess with MacGregor let loose with his chopper, and 1,500 jobs in my constituency at risk.
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There are a number of other reasons why the matter is urgent, but they have been outlined in previous debates, and the House knows only too well what they are.
The most important matter that I ask you to consider, Mr. Speaker, is that, now the dispute is over, in the interests of the country, the communities and the people whom we here represent, Parliament should debate this to ensure that the NACODS agreement made in October last year, which avoided the escalation of the dispute, is now honoured by the Government. It is for Parliament to debate the issue of escalating unemployment caused by colliery closures. It is for Parliament to debate the plight of communities when the main source of economic survival is taken away.
I make the application for all those reasons, including the closure of Bedwas, St. John's, Garw and 10 others in Wales and many others in Scotland and Yorkshire. I am sure that my right hon. and hon. Friends will explain their regional problems in detail if the application is granted. If one checks the number of jobs at risk, it could well exceed the 70,000 mentioned by MacGregor in March last year.
I ask you, Mr. Speaker, in the interest of the thousands who endured 12 months without wages and who suffered in many other ways in fighting to retain their collieries, their jobs, their dignity and their communities, to grant the application under Standing Order No. 10 for a debate to take place before the House rises for the Easter recess.
Mr. Speaker: The hon. Member for Ogmore (Mr. Powell) asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the announced decision of the National Coal Board to close certain collieries in south Wales and elsewhere."
I well understand the concern of the hon. Gentleman. He knows that the only decision that I have to take is whether to give the matter precedence over the Orders set down for today or for tomorrow.
I have listened to what he has said, but I regret that I do not consider that the matter that he has raised is appropriate for discussion under Standing Order No. 10 and, therefore, I cannot submit his application to the House.
Mr. Stanley Orme: I do not wish in any way to contradict the decision that you have made, Mr. Speaker. However, in view of the seriousness of the situation, which could deteriorate, there is widespread concern not only about pits in south Wales but about pits in Scotland and in parts of England. If, during the Easter recess, the situation deteriorated, would it be in order for the Opposition to communicate with you about the seriousness of the position?
Mr. Speaker: That would be absolutely in order.

Trade Union Act 1984 (Amendment)
4.29 pm
Mr. A. J. Beith: I beg to move,
That leave be given to bring in a Bill to amend the Trade Union Act 1984 to replace contracting out with contracting in to trade unions' political funds.
Mr. Kevin Barron: It has stood the test of time.
Mr. Beith: When the House considered the Trade Union Bill a year ago, it failed to deal adequately with one of the features of trade union law that has fallen most into disrepute—the system by which many trade unions are assumed to be willing to pay a political levy to the Labour party unless they take active steps to contract out of that levy. My Bill seeks to put right that omission by making subscription to political funds dependent upon contracting in — [Interruption] —so that every trade unionist who contributed to a political fund would be doing so with his own explicit consent. That basic principle seems so eminently reasonable — [Interruption]— that anyone unfamiliar with the background to the issue, or, indeed, unfamiliar with the Labour Members who seek to deny me a hearing, would expect it to be accepted in the House without question or dissent. I shall refer to that background in a moment.
My Bill also includes another provision designed to improve the 1984 Act by ensuring that the ballots that are about to take place in the unions on the whole principle of having political funds are counted independently. Several unions already use independent counting facilities for internal elections and ballots, but some do not, and there have been some rare but appalling examples in previous years of interference with ballots. Fresh allegations of that sort have come to light recently in relation to the Transport and General Workers Union and have led my hon. Friend the Member for Leeds, West (Mr. Meadowcroft) to call for a Trades Union Congress inquiry. It is clearly desirable that the political fund ballots, in which there is much money at stake, should be seen to be independently counted.
The main provisions in my Bill, which concern contracting out of the political levy, are also relevant to the current round of ballots. If my Bill were passed and political funds became genuinely voluntary, the argument for voting no in the ballots would not be so strong. As long as the political levy is a way of exacting involuntary donations for a political party from people who do not support that party, any trade unionist who wants to preserve his right to decide what political use is made of his own money has no alternative but to vote against the political funds. That is what will happen in several unions, and that is why the Labour party is campaigning to save the political funds. The theory is that it will be a softly, softly campaign—unless the hon. Member for Bolsover (Mr. Skinner) get in on the act—
Mr. Dennis Skinner: I have done.
Mr. Beith: There will be no mention of the fact that the real destination of the political funds is the Labour party. If Labour Members supported my Bill, it would be a different story. Many trade unionists who will vote
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against the present Labour levy might be persuaded to accept that their union could have a political fund if that fund was genuinely voluntary.
Some argue that since it is possible to contract out under the present law and should be easier to do so under the new TUC statement of guidance, the system is really voluntary. If it is, what are Labour Members worried about? The change to contracting in should not make any difference. The figures tell a different story. In two of the largest unions, the TGWU and the National Union of Public Employees, 98 per cent. of members pay the political levy. In the last election just over a quarter of the electorate voted for the Labour party. That makes it unlikely that even half of TGWU members voted for the party to which they are contributing on a supposedly voluntary basis. That 98 per cent. figure has all the ring of a Soviet Union election. What is more, the MORI — "Union World" poll showed that at least half the members of NUPE and TGWU were against having a political fund at all.
It is obvious that the practical obstacles to opting out and the fear of being singled out in the branch or workplace lead to far more people paying the levy than would choose to do so. On the question of principle, as the Government's 1983 White Paper put it:
"It is objectionable in principle that anyone should have to indicate his dissent from the political alignment of his union to avoid contributing to political activities or to a political party to which he is opposed."
The Government have not followed through that logic.
I believe that my proposal will be widely supported by members of trade unions because it is part of the process of getting the unions back under the members' control. It will help to focus the attention of trade union leaders on the need to put the case on behalf of their members to politicians of all parties instead of concentrating on affiliating Labour party conference votes by the million and writing the cheques for Labour's election campaign.
However, there are also good reasons why a thoughtful Labour supporter should support my Bill. There have been a few within the Labour party who have questioned the desirability of the financial hold that the unions have over their party, and who have questioned the ability of trade union leaders to wield votes by the million at Labour party conferences. Labour Members might also reflect that with truly voluntary funds at least some union money might come their way, whereas under the present arrangements it is all or nothing. I think that many union members would vote not to have the funds at all.
Perhaps most interesting of all will be the attitude of Conservative Members to my Bill. During the passage of the 1984 Bill, just over 40 of their number stood firm and voted for the voluntary principle of contracting in. However, Ministers trooped through the Lobby with the Labour party to hang on to the contracting out system that they had so long criticised. Why? There are two reasons, which are well summarised in The Guardian:
"The Conservatives … are playing a cool and surprisingly 'clever clever' game. Their aim is to weaken Labour but not to destroy it. For destroying Labour would turn the Alliance into the main party opposition."
The other reason that is advanced is that
"the Conservatives do not want to draw attention to their own, equally undemocratic source of finance —company cheques doled out at the whim of company chairmen and company boards, (No question of shareholders' ballots …)."
On the second issue, that of company donations, the hon. Member for Leeds, Central (Mr. Fatchett) could help us. I do not see why we could not work as a partnership.

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He has before the House a Bill designed to regulate company donations to political parties. I am happy to support his Bill and I believe that he should be happy to support mine. They would work together. It is a good pair of measures. The hon. Gentleman should do that instead of opposing my Bill.
However, when it comes to the desire of some Conservatives to protect, feather-bed and prop up the Labour party, there can be no doubt that that was the motive that led Ministers to oppose their Conservative colleagues and join Labour in the Lobby. What they are thinking is: better the devil they know, and know cannot win, than the devil they really fear can beat them. [Interruption.] Labour Members can laugh, but the same feeling underlies today's announcement that six Conservative and five Labour peers and one alliance peer are to be appointed. It is the same thing. Conservatives are saying, "For heaven's sake, help poor Neil out and prop up the Labour party a little longer".
I invite Conservatives to put aside those considerations and vote for what they believe — that union political contributions should be on a genuinely voluntary basis. Those who join us in the Lobby to support that principle will be supporting the best interests of trade unions and the health of British politics. Those who oppose us will be those who want to freeze British politics in the pattern of half a century ago, without regard to the wishes of the people.
4.38 pm
Mr. Derek Fatchett rose—
Mr. Speaker: Does the hon. Gentleman wish to oppose the Bill?
Mr. Fatchett: Yes.
The speech that we have just heard from the hon. Member for Berwick-upon-Tweed (Mr. Beith) will rate high in terms of hypocrisy. When one looks at Social Democratic party members, one sees people who have accepted donations from political trade union funds. Now they seek to move in an alternative direction. Later I shall refer to the attempts of the Liberal party to seek funds from trade unions. I should like to hear their reaction to that.
The hon. Gentleman's proposition depends on two arguments. First, the argument goes that trade unionists are not allowed to opt out of paying the political levy. The hon. Gentleman said that it was involuntary; he said that there is a compulsory political levy. I wonder how far one can stretch reality. The truth is that over 2 million trade unionists opt out of paying the political levy. Therefore, those who opt out of paying the political levy are no secret society. They are no exclusive group of people. They are widely advertised. Let us look at the evidence — [Interruption.] Alliance Members do not agree with democracy because they are not prepared to listen to the debate. [HON. MEMBERS: "Oh."] If the public saw this display, they would realise why certain people left the Labour party. We do not tolerate such tactics.
The argument about people not having the right to opt out has been considered on several occasions. For example, the Donovan Commission in the 1960s, the most thorough piece of research into industrial relations, came up with the conclusion that there was no evidence that people were forced to pay the political levy if they did not want to. At that stage only 1 million were opting out; now the figure is more than 2 million.
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We have had many occasions such as this when people have come forward with this argument and one innuendo and one smear after another, but no concrete evidence. I challenge the hon. Gentleman to bring concrete evidence. In front of the Employment Select Committee two years ago, the director general of the Engineering Employers' Federation, Dr. James McFarlane — not, I suspect, a supporter of the Labour party — said that he would provide the Select Committee with evidence. When he was challenged on the point, he replied that he had
"Not anything that I think you would recognise as evidence".
I think that what we have heard from the hon. Gentleman in his speech this afternoon is exactly the same — not anything that could be called evidence. It is typical of the Members of the alliance that they run a smear a day without providing any policy or any information.
As the first proposition falls, so does the second. The hon. Gentleman says that more people pay the political levy than vote Labour. We recognise that fact. We also recognise the fact that according to the latest opinion polls more than half the trade unionists intend to vote Labour at the next election. But we recognise too—and it is about time that the alliance did so—that political funds are not used just for affiliation to the Labour party; they are also used for political campaigning by trade unionists. If the hon. Gentleman had quoted other figures from the MORI poll he would have seen that the overwhelming majority of trade unionists support the right of the trade union to organise political campaigns. The hon. Gentleman wants to stop that happening.
The hon. Gentleman made a passing reference to the £3 million a year that the Conservative party receives in company political donations — without a ballot and without the shareholders having the right to opt out. He then very kindly referred to my own Bill and said that we could form a partnership, and that he was prepared to support my Bill. May I let the House into a secret before we do the deal? When I introduced the Bill on a Friday in February I looked around and did not see one member of the alliance in the Chamber. That is the sort of support that I would get from them. When it comes to voting against company donations to the Tory party and some donations that members of the alliance may want to benefit from, they are not here. They were not here on that occasion. So the evidence suggests that we have a one-sided case from the Liberals.
I want to refer again to the Liberals' attempts to get money from trade union organisations. I am lucky enough to have a letter in my possession addressed to the general secretary of the Post Office Engineering Union. It is dated 13 June 1969—[Interruption.] Members of the alliance might want to listen to this. It was written by the then Member of Parliament for Cornwall, North, Mr. John Pardoe, and it still has relevance, because the leader of the Liberal party was a member of the parliamentary Liberal party at that stage and presumably supported the sending of this letter, from which I shall quote one or two sections:
"The time has come to resurrect those links which bound many of the early Trade Unionists to the Liberal party so that we can work more closely together."
The letter then goes on to say—and this is certainly true if this afternoon's performance is anything to go by:
"I have to admit that many Liberals are deplorably ignorant of the workings of the Trades Union Movement … This ignorance is largely a result of the lack of a full-time Industrial Relations Officer within the Party organisation. This in its turn

1239
has been due to lack of cash and I should like to suggest that your Union might contribute to the cost of a Trade Union Liaison Department at Liberal Party Headquarters."
It is interesting, is it not, that in 1969 the begging bowl was going round to trade unions? I suspect that if the Liberals could get a penny in the begging bowl now this Bill would not be here. The reality is that trade unions have rejected the Liberal party, although companies may support it as an alternative capitalist party.
We have had from the alliance this afternoon a typical exhibition of an excess of hypocrisy and opportunism. By contrast, the letter shows a lack of consistent principle. A party that can beg the unions for money at one stage and then try to cut off contributions at another is not worth further consideration, and I hope that the House will reject the Bill.
Question put:—
The House divided: Ayes 68, Noes 139.

Division No. 181]

[4.45 pm

AYES

Aspinwall, Jack

Kennedy, Charles

Batiste, Spencer

Kilfedder, James A.

Beaumont-Dark, Anthony

King, Roger (B'ham N'field)

Beith, A. J.

Knight, Gregory (Derby N)

Bendall, Vivian

Knight, Mrs Jill (Edgbaston)

Best, Keith

Lilley, Peter

Bevan, David Gilroy

McCusker, Harold

Biggs-Davison, Sir John

Maclennan, Robert

Blackburn, John

Meyer, Sir Anthony

Body, Richard

Morris, M. (N'hampton, S)

Bowden, Gerald (Dulwich)

Murphy, Christopher

Braine, Rt Hon Sir Bernard

Neale, Gerrard

Bruce, Malcolm

Osborn, Sir John

Buck, Sir Antony

Penhaligon, David

Chapman, Sydney

Proctor, K. Harvey

Clark, Dr Michael (Rochford)

Ross, Stephen (Isle of Wight)

Cockeram, Eric

Shelton, William (Streatham)

Conway, Derek

Spence, John

Cormack, Patrick

Stanbrook, Ivor

Currie, Mrs Edwina

Steel, Rt Hon David

Dickens, Geoffrey

Stewart, Andrew (Sherwood)

Farr, Sir John

Stewart, Rt Hon D. (W Isles)

Forth, Eric

Townsend, Cyril D. (B'heath)

Fry, Peter

Wainwright, R.

Galley, Roy

Walden, George

Gardiner, George (Reigate)

Wallace, James

Gorst, John

Wells, Bowen (Hertford)

Hamilton, Neil (Tatton)

Wilson, Gordon

Hancock, Mr. Michael

Wolfson, Mark

Harvey, Robert

Wood, Timothy

Hawkins, C. (High Peak)

Wrigglesworth, Ian

Hughes, Simon (Southwark)

Yeo, Tim

Jenkins, Rt Hon Roy (Hillh'd)

Johnston, Russell

Tellers for the Ayes:

Jones, Gwilym (Cardiff N)

Mr. John Cartwright and

Jones, Robert (W Herts)

Mr. Archy Kirkwood.

NOES

Adams, Allen (Paisley N)

Barnett, Guy

Anderson, Donald

Barron, Kevin

Archer, Rt Hon Peter

Benn, Tony

Ashton, Joe

Bidwell, Sydney

Bagier, Gordon A. T.

Boothroyd, Miss Betty

1240

Boyes, Roland

Litherland, Robert

Bray, Dr Jeremy

Lloyd, Tony (Stretford)

Brown, Hugh D. (Provan)

Loyden, Edward

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

McCartney, Hugh

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

McDonald, Dr Oonagh

Buchan, Norman

McKay, Allen (Penistone)

Caborn, Richard

McKelvey, William

Callaghan, Jim (Heyw'd & M)

Mackenzie, Rt Hon Gregor

Campbell-Savours, Dale

McTaggart, Robert

Canavan, Dennis

McWilliam, John

Clark, Dr David (S Shields)

Madden, Max

Clarke, Thomas

Marek, Dr John

Clay, Robert

Martin, Michael

Clwyd, Mrs Ann

Mason, Rt Hon Roy

Cocks, Rt Hon M. (Bristol S.)

Maxton, John

Cohen, Harry

Maynard, Miss Joan

Coleman, Donald

Meacher, Michael

Conlan, Bernard

Michie, William

Cook, Frank (Stockton North)

Millan, Rt Hon Bruce

Cook, Robin F. (Livingston)

Miller, DrM. S. (E Kilbride)

Corbett, Robin

Morris, Rt Hon A. (W'shawe,

Corbyn, Jeremy

Nellist, David

Cowans, Harry

Oakes, Rt Hon Gordon

Craigen, J. M.

O'Brien, William

Crowther, Stan

Orme, Rt Hon Stanley

Cunningham, Dr John

Park, George

Davies, Rt Hon Denzil (L'lli)

Parry, Robert

Davies, Ronald (Caerphilly)

Patchett, Terry

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

Pavitt, Laurie

Deakins, Eric

Pike, Peter

Dixon, Donald

Powell, Raymond (Ogmore)

Dormand, Jack

Prescott, John

Dubs, Alfred

Radice, Giles

Duffy, A. E. P.

Randall, Stuart

Eadie, Alex

Redmond, M.

Eastham, Ken

Rees, Rt Hon M. (Leeds S)

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

Richardson, Ms Jo

Fatchett, Derek

Roberts, Ernest (Hackney N)

Faulds, Andrew

Robertson, George

Fields, T. (L'pool Broad Gn)

Rowlands, Ted

Flannery, Martin

Sedgemore, Brian

Foot, Rt Hon Michael

Sheldon, Rt Hon R.

Forrester, John

Shore, Rt Hon Peter

Foster, Derek

Short, Ms Clare (Ladywood)

Fraser, J. (Norwood)

Skinner, Dennis

Garrett, W. E.

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

Hamilton, James (M'well N)

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

Hamilton, W. W. (Central Fife)

Soley, Clive

Hardy, Peter

Spearing, Nigel

Harman, Ms Harriet

Strang, Gavin

Harrison, Rt Hon Walter

Straw, Jack

Healey, Rt Hon Denis

Thomas, Dafydd (Merioneth,)

Heffer, Eric S.

Thomas, Dr R. (Carmarthen)

Hogg, N. (C'nauld & Kilsyth)

Thompson, J. (Wansbeck)

Home Robertson, John

Thorne, Stan (Preston)

Hoyle, Douglas

Tinn, James

Hughes, Robert (Aberdeen N)

Torney, Tom

Hughes, Roy (Newport East)

Wardell, Gareth (Gower)

Hume, John

Wareing, Robert

John, Brynmor

Weetch, Ken

Jones, Barry (Alyn & Deeside)

Welsh, Michael

Kaufman, Rt Hon Gerald

Williams, Rt Hon A.

Kilroy-Silk, Robert

Lamond, James

Tellers for the Noes:

Leighton, Ronald

Mr. Frank Haynes and

Lewis, Ron (Carlisle)

Mr. David Winnick.

Lewis, Terence (Worsley)

Question accordingly negatived.

Orders of the Day

  Interception of Communications Bill
  Considered in Committee [Progress 2 April].
  [MR. ERNEST ARMSTRONG in the Chair]

  Interception of Communications Bill
    Clause 7

      THE TRIBUNAL
      4.55 pm
      Mr. Gerald Kaufman: I beg to move amendment No. 66, in page 5, line 43, leave out `Prime Minister' and insert 'Select Committee'.
      The First Deputy Chairman of Ways and Means: With this it will be convenient to discuss the following amendments:
      No. 80, in clause 8, page 6, line 38, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 95, in clause 8, page 7, line 25, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 98, in clause 8, page 7, line 28, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 102, in clause 8, page 7, line 31, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 78, in clause 8, page 7, line 34, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 105, in clause 8, page 7, line 38, leave out 'Prime Minister' and insert 'Select Committee'.
      No. 115, in clause 10, page 9, line 17, at end insert—
      '"the Select Committee" means a Select Committee of the House of Commons appointed to keep under review the matters referred to in sections 1 to 6 of this Act.'.
      Mr. Kaufman: I apologise because after I have spoken I shall have to absent myself from the debate for a short time. I do not intend to be discourteous to the Committee.
      The amendments are aimed at giving Parliament a role in the supervision of security services activities. Under the Bill the tribunal will report to the Prime Minister when it discovers a contravention of the rules. The commissioner will be appointed by the Prime Minister and will report to the Prime Minister. The Prime Minister will have to lay before Parliament the commissioner's annual reports, but the Prime Minister will be able to censor those reports on what he or she regards as national security grounds. The Prime Minister is required to consult the commissioner about such decisions, but in the end that decision is the Prime Minister's responsibility.
      The commissioner will be the Prime Minister's placeman. I do not mean that he will be a discreditable person, but he will owe his appointment to the Prime Minister alone. Under clause 8(2) the Prime Minister will be able to remove him from office and he will be paid according to a Treasury decision, probably on the Prime Minister's instructions. That is not a proper position in which to place someone whose function is to pass judgment on the activities of the Prime Minister and Ministers and the agencies that they control.
      The discretion to allow interception under the Bill is already much wider than we should like it to be. The
      1242
      commissioner's role is to review the system of authorised interception, which we believe to be too constrictive a role for him.
      Even with the best will in the world the Bill will create a system which at best will be cosy and at worst collusive. Recent events, in particular the disgraceful absurdity of the recent inquiry by Lord Bridge, show how easy it is to conduct a cover-up and how tempting it is for those without knowledge of what has taken place to suspect a cover-up. The only way in which hon. Members can seek to deal with this problem is by ending the possibility of a cover-up. That means ending the system in which the Prime Minister appoints the person whose role and purpose are to ensure that the Prime Minister and his or her colleagues behave properly in one of the most dangerous areas of activity in terms of civil liberties-one of the areas where, as the Sunday Telegraph has indicated., the Government are most in danger of going down the road that ends in the police state.
      5 pm
      It is important that the special branch and MI5 know that not just Ministers are watching what they do — although that fear must have been eased by the Home Secretary's recent quickie investigation into their alleged misdemeanours from which they emerged, to universal astonishment, with a clean bill of health — but that a person appointed by Parliament has a right to examine their activities. Ministers may say that a Select Committee is too leaky or too irresponsible to be trusted with material involving national security. If leakiness is a disqualification from having access to security material, that would rule out the whole of the present Administration which has turned Cabinet government into government by sieve.
      What is more, the security services leak, sometimes to the Government's advantage or to their own advantage; sometimes to their own disadvantage, as in the case of the allegations by Cathy Massiter. If the commissioner was seen to be independent of the Government and not required to report to the Government, it is possible that disaffected members of the security forces might feel that it would be worth while to bring their misgivings to the commissioner rather than to take them to the press or television. That might even lead to an improvement in security.
      We are entrusting a Select Committee with matters involving national security. That has been done before. The Secretary of State for Defence recently revealed those fabulous Belgrano "crown jewels", which we were told were matters of the greatest secrecy, to members of the Foreign Affairs Select Committee. Even after that. the nation still survives.
      This law is being made by Parliament. Surely the House of Commons has sufficient confidence in itself to feel that it can appoint from among its Members persons who can be entrusted with security matters. Perhaps the Select Committee will comprise only Privy Councillors, but that will be a matter for hon. Members to decide if these amendments are inserted in the Bill.
      There are widespread misgivings that the security services, or at any rate elements within the security services, are out of control. If that were so, knowledge that a check on their activities could be conducted—in one sphere at any rate—by an independent person appointed by Parliament might have a healthy effect. Security has become a game played by a self-selected team. We believe that there should be an independent referee who should be

      1243
      a servant of Parliament, not a nominee of the Government of the day. As Lord Denning has firmly pointed out, the national interest is not synonymous with the interest of the Government. There is no better or more appropriate guardian of the national interest than the House of Commons.
      Mr. Chris Smith: I support the amendments. The kernel of the argument is whether the ultimate arbiter—the body that appoints the tribunal and the commissioner and is the final court of appeal in security matters — should be the Prime Minister or a Select Committee.
      One of my constituents who has achieved a certain amount of prominence in recent months is Mr. Clive Ponting. When the prosecution of Mr. Ponting began—it was announced last year—he noticed that his mail was being opened. I have in my hand an envelope that contained a simple, ordinary bank statement which was sent to my constituent by his bank. It took about six days to reach him. The envelope had obviously been opened clumsily and re-sealed. Mr. Ponting noticed later that, over the succeeding months, and even while his trial was proceeding, his mail was being treated similarly. He was extremely concerned about that. As his Member of Parliament, I am extremely concerned about it.
      To whom does Mr. Ponting turn if he wishes to complain about interception of his mail, which cannot conceivably be justified even when the prosecution is proceeding, on any grounds of national interest or national security? To whom ultimately does he turn to complain, to identify what has been happening and who or what authorised that action? To whom does he turn to have the matter resolved?
      In the Bill, the final court of appeal is the Prime Minister; but it was ultimately the Prime Minister, as head of the Government, who was bringing the prosecution against my constituent.
      Mr. Eldon Griffiths: Before the hon. Gentleman went into the generality of his argument, he started with a specific matter. The hon. Gentleman suggested that he had in his hand an example of an unauthorised interception. Will he give hon. Members a little more detail, because I am sure that he would not wish an unfounded allegation to be put abroad without sustaining it? Has the hon. Gentleman checked with the Post Office? Does he have reason to believe that that envelope had been improperly opened by the security services or by the police? What is the hon. Gentleman's evidence?
      Mr. Smith: It is not the place of the House of Commons to act as the jury in a criminal trial. The evidence is in my hand. It is an envelope which has been handed to me by my constituent. He has checked with the bank which sent it. The bank did not open or re-seal the envelope. When the envelope arrived at his house, it had clearly been opened and re-sealed during transit from the bank. In his view, that is precisely what happened.
      The point that I am endeavouring to make is not necessarily that this allegation about the opening of my constituent's mail is true or untrue. On the evidence, it appears to me that he has a good case in making that complaint. My point concerns how, if he believes that this
      1244
      has happened, he pursues the matter and attempts to arrive at the truth and ensure that the truth is identified and properly dealt with.
      Mr. Clive Soley: As I understand it, my hon. Friend is saying that this is one of a number of examples where the mail was late, the evidence suggested that it had been opened and the people who had sent it said that it had not been opened and re-sealed before being sent. Is not the essence of my hon. Friend's case his desire for something like a Select Committee to examine such cases, because hon. Members must satisfy themselves that such allegations are either substantiated or not substantiated? This cannot be done in any other way, and that is the point that is being put to hon. Members. The case put forward by my hon. Friend is an example.
      Mr. Smith: My hon. Friend has gone to the heart of the argument. I am not necessarily saying that a Select Committee must examine the envelope, contact the bank, interview my constituent and talk to the Post Office. That is up to the tribunal and the commissioner. I am asking this question: to whom are the tribunal and the commissioner ultimately responsible?
      If my constituent is facing prosecution by the Government, the head of which is the Prime Minister, he can surely have little confidence in an appeals procedure to seek redress if the ultimate court of appeal, the person responsible for appointing, dismissing, controlling and monitoring the activities of the tribunal and the commissioner that are supposed to oversee the activities of the security services, is the self same head of Government who is bringing the prosecution.
      It is that which concerns me, and which should concern this House and make it wish to place some parliamentary rather than Executive scrutiny and control over the activities of the security services. I am expressing the concern of one of my constituents. It may happen to many other people throughout the country. There is a particular concern in this specific instance. I ask the House to consider carefully the point of principle of who should be the ultimate arbiter in such cases and in matters of control of the security services.
      Mr. Eldon Griffiths: I had not intended to intervene in the debate, but the speeches of the hon. Member for Islington, South and Finsbury (Mr. Smith) and the right hon. Member for Manchester, Gorton (Mr. Kaufman) require one or two comments.
      I do not complain that a constituent of the hon. Member for Islington, South and Finsbury brought a matter to him and that he felt it right to raise it in the House. To my certain knowledge, during the past year there has been a considerable number of allegations of mail being tampered with and they have been most carefully examined by the chairman of the Post Office. He discovered a number of cases where machines had malfunctioned resulting in tampering with mail. He sent his apologies to those concerned. Indeed, there were a number of cases where, for one reason or another, the Post Office had slipped up.
      I am not sure that that is the explanation for the case mentioned by the hon. Gentleman. I would have thought that his first duty to his constituents, the Post Office and those who serve us in the police and security forces would have been to check with the Post Office to ascertain exactly what had happened, rather than raise the matter in the House in a fashion that implies that there was some

      1245
      improper, unauthorised and illegal action by members of the police or security services who have had no opportunity to reply to an implied allegation made without names or times. It is not a fair procedure in the House to make such a generalised allegation without first having ascertained the facts from the Post Office.
      Mr. Soley: Surely that is precisely why we need a Select Committee. It is why so many other countries in the Western world have such a system. It enables the Committee not to investigate particular cases but to look into the general allegations so that it can satisfy the public. That is what democratic forums are for; that is why so many other countries in the Western world do it; and that is what makes us such an oddity.
      Mr. Griffiths: I have enough regard for the hon. Gentleman to know that he can do much better than that, He has become hoist on a particular and rather absurd petard. I shall come in a moment to the question whether there should be a parliamentary Committee to oversee this action of a prerogative. I have said what I have said about the allegation of the hon. Member for Islington, South and Finsbury. I am entitled to comment on behalf of those who, at least implicitly, it is suggested have behaved improperly, without any evidence that the Post Office had first been asked to explain exactly what happened to the envelope.
      5.15 pm
      I and other hon. Members have, from time to time, debated these matters with the right hon. Member for Gorton. He put his arguments with his usual felicity and force. I do not agree with them. He suggested that the special branch is, in some strange way, wholly unaccountable. I remind the House that every special branch police officer is an ordinary police officer under the law. He may have particular functions, but he is just as much subject as any uniformed or detective officer, first and foremost, to the police discipline code; secondly, to the independent police complaints authority, which has been put in place by the recent Police and Criminal Evidence Act; thirdly, to the criminal law, as he must and should be; fourthly, to his chief officer and, through him, to his police authority; and, finally, to the oversight of the Chief Inspector of Constabulary. It is important that the House should recognise that the special branch is not some strange national Gestapo: it is a number of individual officers who are as responsible as any other constables to their individual chief officers and their police authorities. It is unfair to suggest in this House, and especially from the Front Bench, that there is a strange and unaccountable force within our midst. That is simply not the case.
      I found myself in agreement with the hon. Gentleman yesterday when he said that there was a problem of parliamentarians versus the bureaucrats. He opposed an amendment tabled by one of my hon. Friends because he did not want the Home Secretary's powers put in commission either to a body of judges or to a body of Privy Councillors. I share his objections.
      Yet today, the right hon. Gentleman virtually supported in respect of the Prime Minister the very things that he had been against in respect of the Home Secretary's conduct of his office. He cannot have it both ways. Either the Opposition think that it would be wrong to put the Home Secretary in commission or they now take another view that the Prime Minister's functions should be put in
      1246
      commission by a privy council group or—although this has not been proposed—by a group of judges. There is an inherent inconsistency in the Opposition's policy.
      Prime Ministers, whatever their party, ultimately have to take responsibility for the conduct of the Government. Parliamentary accountability is in this House. It is not simply the accountability that takes place when there are votes on issues of confidence. We all know that Ministers of the Crown, of any party, must live with this House all the time. If they cause offence to the House as a whole on one matter, the House will get back at them on some other matter. That is where there is a real accountability. Ministers have to live in Parliament and are Members of Parliament. Their real accountability arises not merely from the statute but from their existence here as Members of Parliament.
      It is impracticable, unconstitutional and certainly unnecessary to seek to remove from the Prime Minister the responsibility either of the appointment or of the oversight of the activities of the commissioner. The commissioner is a new invention. If I am not mistaken, his arrival on the scene is an example of the Government and the Home Secretary going further than the European Court actually requires. It is an attempt by the Home Secretary to reach out towards the objections that have been made from the Opposition on the matter of civil liberties, in the belief that he will be providing a greater degree of surveillance, oversight, monitoring and accountability of the activities of the security services.
      Far from it being a matter which is hidden or disguised, the fact that the Prime Minister, as head of the Government, is brought in to select, appoint and be responsible for the activities of the commissioner is a demonstration of how seriously the Government are taking the matter. I hope therefore that the amendment will not be accepted.
      Mr. A. J. Beith: This group of amendments alerts hon. Members to the desirability of involving a Select Committee in the process of scrutiny, not just at the point mentioned in amendment No. 66 but at the points in the Bill referred to in other amendments in the group. We have an opportunity, therefore, to consider the necessity to involve a Select Committee in the Scrutiny of the activities and organisations to which the Bill relates.
      It is a course of action which the Prime Minister has strongly resisted—in many respects, though not entirely, because she has volunteered to the House statements on a number of security matters. The problem is that some of those statements have subsequently turned out to be based on incorrect advice given to the right hon. Lady. That is a reminder that relying on the occasional prime ministerial statement as the main basis for parliamentary scrutiny of the activities with which we are concerned is not adequate.
      The present Prime Minister, above all, should be the first to recognise the need to introduce some parliamentary scrutiny into these affairs, because she has been the victim, as it were, of security matters which have not been her direct responsibility. Some of them arose long before she came to office. Nevertheless, she has been given prepared statements to make to the House and has subsequently had to modify them. She may yet have to modify others—for example, those relating to the Hollis case.

      1247
      There are broader reasons why we need to consider a Select Committee as a place of recourse for the tribunal, the commissioner and others who may be involved in these matters. The most obvious reason for having such a body is to build greater public confidence in the security services. We would not be passing this legislation if the European Court had not pulled up this country for its lack of legislation in this sphere. Equally, hon. Members would not be supporting the broad principles of the Bill were we not convinced that circumstances exist when an unwelcome activity such as the interception of communications must be carried out.
      It is accepted that those who do that job undertake it on behalf of the country, to protect us from serious crime, such as terrorism; and to meet the criteria set out in the Bill. If they are to do that job properly, there must be greater public confidence that they are not engaged in activities that go far beyond those purposes.
      Some of the machinery in the Bill will assist in creating that confidence, but if, at the end of the day, the various bodies involved do no more than report to the Prime Minister, so contributing to an annual report to the House, public anxiety will not be allayed and confidence will not be sufficiently built up, for the public rightly expect this House to take a closer interest in these matters.
      I am speaking not of a day-to-day, looking-over-the-shoulder approach to individuals who carry out the tasks involved. That would be inconsistent with their carrying out those activities properly. This House should at least be involved in considering in some detail what criteria are being followed, how the work is being organised, who is doing it and what has happened when abuses have been alleged.
      Another reason why the reporting procedure should go wider than the Prime Minister and involve a Select Committee is that effective scrutiny is more likely to occur if the Prime Minister and those Ministers involved, such as the Home Secretary, are under pressure and subject to scrutiny by the House, rather than being able to avoid that scrutiny by not having to answer parliamentary questions on these issues, having to appear before Select Committees or having their officials appear before Select Committees.
      It is noticeable, looking back at the record, that, in their busy lives, Ministers give more attention to issues on which they are under pressure and subject to scrutiny than to those from which they are freed from that scrutiny. I am supported in that view by a former Prime Minister, the right hon. Member for Cardiff, South and Penarth (Mr. Callaghan), who, in a previous debate on this subject, conceded from his experience that, by and large, when Select Committees are pursuing matters, their inquiries often take priority with Ministers over other matters which are assumed to be going satisfactorily and on which those pressures are not exerted. We would have more effective scrutiny of the security services if there were some supervision by Parliament.
      Mr. Nicholas Soames: Bearing in mind the record of some Select Committees in relation to leaks, does the hon. Gentleman consider that the facilities and procedures are clearly enough established to allow delicate
      1248
      security matters to be aired before a Select Committee without the risk of those matters being leaked to the national press?
      Mr. Beith: The hon. Gentleman may have been present when we debated matters being referred to the Privileges Committee. He will recall that I hinted at precisely the point that he raises when I spoke on that occasion.
      That said, it must be agreed that there is a world of difference between those considerations which prompted someone, rather dishonourably, to leak in advance certain proposals that were being considered in that Committee, and the considerations that arise when hon. Members are under a clear injunction to respect the security nature of certain matters. The record of the House is good when secure and delicate matters are involved. If the hon. Gentleman consults the record, he will find that the arguments on the sort of issues which he has in mind concern the premature disclosure of matters which, perhaps, could be politically embarrassing.
      That must be borne in mind when considering the type of Select Committee we would have. The level of seniority—whether Privy Councillors should comprise the whole membership—and similar relevant questions would need to be resolved when considering the nature of the machinery. I have confidence in the ability of the House to arrange such matters.
      Sir Edward Gardner: Will the hon. Gentleman agree, from the experience of the affairs of the Home Affairs Select Committee being leaked, and the experience of the Committee of Privileges having its report on the leak of the Home Affairs Select Committee leaked, and the number of leaks that have come from the Home Affairs Select Committee since then, that what is happening is in the nature not of a leak but of a burst pipe?
      Mr. Beith: As the Chairman of the Home Affairs Select Committee, the hon. and learned Gentleman must put his own house in order. I took part with him in debating that issue.
      I could not have expressed myself sufficiently clearly in what I said. I explained that, however much I deplored breaches of confidentiality — I supported the hon. and learned Gentleman and voted with him for the reference of that leak to the Committee of Privileges—there was a difference between leaks which arose when someone was taking political advantage of the opportunity to disclose something prematurely, perhaps hoping to influence the outcome of the Committee's deliberations, and circumstances when people were aware that to disclose something would severely harm the interests of the nation and carrying out the work that the Committee was overseeing. There is a clear difference in such circumstances and hon. Members would need to look much harder to find evidence of matters going wrong on that front.
      Mr. John McWilliam: Is the hon. Gentleman aware that every week the Government deliberately leak, at unattributable meetings which are alleged never to have taken place, large chunks of information which otherwise would be official secrets?
      The First Deputy Chairman: Order. If that intervention were pursued, we should be getting right away from the subject of the amendment.
      Mr. Beith: I was adducing reasons why the involvement of a Select Committee is important. If hon. Members say that the Select Committee system is incapable of examining any area of government in which disclosure would harm the interests of Government, we might as well abandon the Select Committee system and a great deal else that goes on here. We might as well, at the same time, dismiss many Ministers who, for a variety of reasons, disclose information, when, if their civil servants did it, they might find themselves following Mr. Ponting into the Old Bailey.
      Mr. Kevin Barron: And out again.
      5.30 pm
      Mr. Beith: We should have confidence in the House, and in its ability to recognise that we are capable of handling in an appropriate way matters which require that degree of security. We are at least as capable of doing so as Government Departments, Ministers or, indeed, the organisations that carry out these activities. Those organisations are not immune to leaks when a particular policy is being pursued, or resisted from within.
      I said that public confidence required the involvement of a Committee of the House, and that effective scrutiny was required. The third reason is that those who work within the security services on intercepting communications, on organising rather than carrying out intercepts, are placed in a difficult position if they are asked to do tasks which they consider fall outside the proper terms of reference of their work. That is another reason why it is necessary for the House, rather than the Executive, to be the ultimate recourse.
      The commissioner, the tribunal or any of the other bodies referred to in the Bill should have recourse to the House. It is not good enough to say, as the Home Secretary has said at least once, that those who are engaged in this work and asked to carry out tasks that they think are wrong and outside their terms of reference have only to refer upwards within their organisation or to the head of their organisation to be satisfied, to clear up the position and to have the matter properly settled.
      The Home Secretary must know how contentious the record is of a previous head of one of the organisations involved. He must know that it was impossible for those who suspected that previous head to go to him to raise their fears. Whether or not those fears were justified, the Home Secretary must know that the area of doubt is sufficient for there to be a great many people ranged on either side of the argument. In those circumstances, it was impossible for certain people to go to the head of the organisation and say, "I lay my cards on the table. I think that I am being asked to do this for the wrong reasons, and that the information will be used in the wrong way. What shall I do?" The proposition is ludicrous, which is why there must be some recourse outside the service. The ultimate recourse should be to the House, not the Executive.
      The Government must realise that it is in their interests and those of the country that if people within the services find themselves dragged into activities which they believe to be wrong they have the means to speak out clearly without recourse to the media. Television must not be the only way to challenge a practice which otherwise seems to be accepted by immediate superiors. The confidence of having a road to follow, at the end of which lies, not the head of the Executive or the head of Government, but the
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      House of Commons, would improve morale in the security services, make it easier for them to do their job properly and enhance confidence in the services. The Home Secretary surely does not assume that morale in the services has been unaffected or unharmed by some of the problems that have arisen in recent years, let alone recent months, as some of his hon. Friends seek to do. The matter must be put right.
      Mr. Steve Norris: Those of us who were present yesterday will recall that the hon. and learned Member for Montgomery (Mr. Carlile) rejected the hon. Gentleman's line. The hon. and learned Gentleman supported the thoughts propounded by my hon. Friend the Member for Crawley (Mr. Soames) and my hon. and learned Friend the Member for Fylde (Sir E. Gardner). They suggested that, while the point about accountability was entirely understandable, a Select Committee was not the appropriate mechanism. Would the hon. Gentleman agree to contemplate one of my alternatives, which is a committee of Privy Councillors specifically chosen to allow for accountability, and at the same time the removal of such persons from the day-to-day hurly-burly of political life?
      Mr. Beith: My hon. and learned Friend was addressing a different part of the Bill. He talked about a committee of Privy Councillors without excluding hon. Members who are Privy Councillors from that committee. Clearly there are many different devices by which we can ensure that scrutiny is not confined to the head of the Executive. That is the key objective. There must be some recourse which does not simply involve the head of the service, a commissioner or a tribunal, depending on which part of the Bill we are talking about, going directly back to the head of the Executive, and only an annual report to Parliament as the means of going beyond that.
      That is a key issue. It arises under this Bill and will arise again as we consider wider aspects of the work of the security services. Now is a good time for the Government to address themselves to the problem. The Bill is particularly appropriate to it. I hope that they will go further than they have gone so far in recognising the genuine need that I have set out.
      Mr. Jonathan Aitken: I had not intended to intervene in this part of the debate, until I listened to the speech of the hon. Member for Berwick-upon-Tweed (Mr. Beith). He put his finger on the central weakness of the Bill, which is that there is no mechanism, outside the internal security services and the Executive, for parliamentary or extra-territorial control of the security services in relation to the interception of communications.
      I was especially interested in the hon. Gentleman 's brief references to the Hollis case, which, historically speaking, are the most illustrative episodes. They suggest some form of mechanism, perhaps not quite along the lines suggested by the hon. Gentleman, but along the lines of new clause 3, which will be debated shortly. In view of his suggestions, it is right at this stage to look at the history, without revealing deep secrets, to highlight the grave difficulties which the security services got into in the past and could get into in future if there is not some form of parliamentary control outside the Executive and the security services.
      It is well known to those who have read recently published books on the subject that in the mid-1960s it was

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      common ground among the heads of the security services that MI5 had been deeply penetrated and that there were Soviet moles at large who could seriously be compromising the whole of Western intelligence. It was identified at an early stage that both Philby and Blunt were responsible for much of that penetration, but the fear continued that there was a bigger mole at large.
      In 1963 a break came, largely because of the interception of communications, and the hunt for the super mole was narrowed down to one of four people. Extraordinarily enough, the hunt was reduced to either the director-general of the security services, Sir Roger Hollis, or his deputy, Mr. Graham Mitchell. I stress that there is nothing new in what I am saying, in case anyone thinks that I am making some sensational revelation.
      The head of the division, who was in charge of the whole operation, naturally wished to bring the matter to whatever level seemed appropriate to get to the heart of the penetration. What could he do? We now come to the kernel of what was wrong then, and is wrong today. There was nowhere for him and his colleagues to go outside his service. They were pejoratively referred to as "the young Turks", which is a most gratuitous label in view of the deeply patriotic and serious professional counterintelligence work that they have done. The head of the division responsible went outside the service, to the head of M16, to ask for guidance.
      The head of M16 answered, "It cannot be Roger, and therefore you must ask his permission to investigate the deputy director-general of security services." There then followed a somewhat bizarre dinner at the Travellers' Club, at which the head of the anti-Soviet division discussed counter-penetration with the director-general of the security services and the possibility of investigating the deputy director-general of the security services.
      By that stage, it was clear how incestuous the operation was becoming. There was no ombudsman, parliamentary Select Committee, independent oversight or court of appeal to whom a genuine and sincere whistle-blower—albeit an internal whistle blower—could go. There lay a fundamental weakness, because one of the suspects then had to insist that an investigation take place on the other suspect. There was then a massive investigation. It was well documented by journalists and others. It is illustrative that that investigation involved methods which we are reassured by my right hon. and learned Friend the Home Secretary and by the Bill could not take place today.
      I do not always find myself in complete agreement with the right hon. Member for Chesterfield (Mr. Benn), especially when he clashes in the House of Commons with my right hon. and learned Friend the Home Secretary. There was a most revealing exchange yesterday when my right hon. and learned Friend rebuked the right hon. Gentleman for suggesting that surveillance and investigation of communications were two completely different things. My right hon. and learned Friend said:
      "There is the world of difference between listening to somebody on the telephone, which is essentially what interception is about, and surveillance. The right hon. Gentleman has just said that under the cloak of surveillance people's telephone conversations can be listened to. That simply is not true."—[Official Report, 2 April, 1985; Vol. 76. c. 1121.]
      I was pleased to hear that reassurance given in 1985. In the middle of the 1960s, it would not have been
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      followed. To carry out the investigation into the deputy director-general of the security services, Mr. Mitchell, all kinds of surveillance techniques were used to listen to telephone conversations, without ministerial warrants or knowledge, and with a complete abandonment of the rules which we hope are carefully observed today. I hope that before the Bill reaches the statute book all those responsible for today's arrangements will look back to the breaches in 1963, or thereabouts, to ensure that such an evasion of the ground rules and regulations cannot take place today.
      Mr. Eldon Griffiths: How does my hon. Friend know that no warrant was issued for the tapping of the deputy's telephone?
      The First Deputy-Chairman: Order. I have been listening carefully to the hon. Member for Thanet, South (Mr. Aitken). We are discussing a narrow series of amendments about accountability, and I hope that he will bring himself to the amendment directly.
      Mr. Aitken: I shall not wander any further, Mr. Armstrong, nor detain the Committee for much longer. Some form of parliamentary control or court of appeal—be it a parliamentary commissioner or ombudsman of the type suggested in new clause 3 or a Select Committee of the type suggested in the amendments—is crucial.
      My hon. Friend the Member for Bury St. Edmunds (Mr. Griffiths) asked how I know that no warrant was issued. I believe it, on good authority, to be the truth. The records are there to be inspected. The security services have put their house in much better order today than was perhaps true in 1963.
      I finally illustrate the need for some form of parliamentary control, as opposed to leaving the executive in control, by adding a postscript to the Hollis story. The deep discontent over the findings, or, to be more precise, the non-findings, of the various committees, researches and investigations remains unresolved.
      There was a remarkable episode when, suddenly, I believe in approximately 1970, the then director-general of the security services terminated, without the agreement of his colleagues, all investigations and all further chasing of leads into penetration at that high level. At least one member of what was called the fluency committee—another highly patriotic and deeply dedicated counterintelligence officer, Mr. Stephen de Mowbray—was so distressed that he sought to get through to a higher level. He was able to do so by a most remarkable effort—by knocking on the door of No. 10 Downing street and demanding to see the Prime Minister. At first he was refused, but, as a result of an old college connection with a private secretary at No. 10 Downing street—again, only the incestuous old boy network made some of these secret approaches outside the service possible—he was able to see the secretary to the Cabinet. Another inquiry under Sir Burke Trend was set up. The results of that inquiry would, by parliamentary commissioner or Select Committee standards, be unsatisfactory because of the methods used, and because the results given to some of those involved, and to my right hon. Friend the Prime Minister much later, were completely different.
      5.45 pm
      Mr. Beith: Is not what the hon. Gentleman saying directed to the substance of the amendments? What

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      happened at the end of the day—if it is the end of the day, and it may not be—was that the Prime Minister made a statement to the House, with some aspects of which Lord Trend seems to have disagreed. In particular, he disagreed with the chronology of the events. If the matter had been brought before a Select Committee or some other scrutiny body it would have been possible to pose some questions on that point. The idea that a once-and-for-all statement can deal with such a scrutiny problem is effectively torpedoed by the experience in that case.
      Mr. Aitken: I agree with the hon. Gentleman. At least when a Select Committee reports there is one final report. One of the problems with Lord Trend's report was not just that it was unpublished—that might have been necessary given the degree of secrecy involved—but that at least two or three different versions of the report and conclusions seem to have emerged. It is most unsatisfactory to have three answers when they do not seem to sing in unison. There is a fundamental weakness, not just in the methods of such oversight, but in its reporting. That would be remedied by a Select Committee.
      Despite my somewhat encouraging remarks about the amendments, I shall not join the hon. Member for Berwick-upon-Tweed in the Lobby tonight, not least because I tend to agree with the intervention of my hon. and learned Friend the Member for Fylde (Sir E. Gardner), who suggested that a Select Committee would be like a burst pipe.
      A safer form of conduit is necessary for an adequate degree of oversight. At the same time, I should like the Government clearly to understand that there is support and sympathy on the Conservative Benches for the principle that what is needed, and what is still lacking from the Bill, is some small foothold of independent parliamentary oversight of the security services. The lessons of the past and the present—I refer, in particular, to the Massiter disclosures—do not encourage us to think that they will go unheeded in the future.
      Mr. McWilliam: I always enjoy listening to the hon. Member for Thanet, South (Mr. Aitken) when he speaks about these issues. He has not disappointed us this evening. May I begin by declaring my interest as a sponsored member of the National Communications Union engineering section? May I also compliment the Clerk of the House on cheering up the Clerk's Bench no end?
      There are some serious points to consider. I shall pick up the point that my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) made and the reply by the hon. Member for Bury St. Edmunds (Mr. Griffiths). My hon. Friend has a point. I see in the Register of Members' Interests that the hon. Member for Bury St. Edmunds is a consultant to the Police Federation. He should ask it for a better brief than the one he has tonight. I recommend that he should read the point that Charles Morris, the former Member for Manchester, Openshaw, made in Committee on the Telecommunications Bill in 1982. He described in detail how postal interception occurs, how it is authorised and what is done.
      Clearly, the hon. Member for Bury St. Edmunds does not know what he is talking about. That information is on record in the Official Report, and I would commend to any hon. Member who has not read it that part of the Committee proceedings. It is quite illuminating.
      Mr. Eldon Griffiths: In case the hon. Gentleman is under an illusion, may I say that I have no brief from the Police Federation on these matters. My intervention about the interception of the mail mentioned by the hon. Member for Islington, South and Finsbury (Mr. Smith) was made solely because I believe that it is necessary, in that case, to consider the evidence. I made no general statements.
      Mr. McWilliam: I do not impugn the behaviour of the hon. Gentleman. My point is that I am always proud to declare my interest in the House. If the hon. Gentleman fails to do so, that is a matter for him and for the Chair, not for me. Every hon. Member knows the basis on which I speak. They know that I am a sponsored member of my union. That does not imply—
      The First Deputy Chairman: Order. We must keep to the amendment.
      Mr. McWilliam: I beg your pardon, Mr. Armstrong. I wanted to make it clear that I speak on amendment No. 66 on my own account, because my union has no policy on amendment No. 66. I accept that the Police Federation probably has no policy on amendment No. 66 either.
      I agree with the final point made by the hon. Member for Thanet, South. We do not want to have to deal with drain pipes. It is true that there have been leaks from Select Committees to the press—the Committee of Privileges has already determined that that has happened — but those leaks have been made to the British press. Unfortunately, the security services have been known in the past to leak directly to the Kremlin. There is a world of difference between a leak from a Select Committee to the British press and a leak to the Kremlin. I accept the point by the hon. Member for Thanet, South, but I also accept that there could be some misgivings and that Conservative Members might prefer a committee of Privy Councillors.
      I know the oath that a Privy Councillor takes. It is supposed to be classified, but it has been well publicised. The oath is a serious one. However, when hon. Members take their seats in the House they also take an oath at the Dispatch Box. That oath is just as sincere and just as binding, and I do not believe that Select Committees are any more leaky than any other arrangements that we may set up.
      The Bill will withdraw liberties from our people. If we were discussing the Bill in a vacuum and if there had been no 1920 Act, we would be discussing interference with the privacy of the citizens of this country and withdrawing their liberties. I would prefer this House, rather than the Executive, to have the final oversight over the withdrawal of liberties. I am sure that, as a philosophical point, that view would command acceptance much more widely than just among my hon. Friends.
      Mr. David Winnick: The hon. Member for Bury St. Edmunds (Mr. Griffiths) said towards the close of his speech that it would be almost unconstitutional for these matters to be discussed.
      Mr. Eldon Griffiths indicated dissent.
      Mr. Winnick: That is what I heard—that it would not be constitutional. I wondered for a moment whether the hon. Gentleman was going to suggest that we were being subversive in wanting some degree of parliamentary scrutiny and accountability in these proceedings.

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      The present arrangements, under which there is no accountability by the security services, is of long standing, but it is wrong. For example, it is out of order for an hon. Member to table a question on such a matter. We can occasionally debate the subject. I have an Adjournment debate on it tomorrow. However, although the hon. Member for Thanet, South seemed to accept the case for parliamentary accountability, I believe that the essence of the division between the two sides of the Committe is that we believe that some degree of such accountability is a necessity.
      The Prime Minister is of course responsible to Parliament, but she has immense powers. She is the head of the security services. To some extent, as the Bill stands, the Prime Minister is almost judge and jury in her own cause. There is no way in which we can question the Prime Minister on such matters. On numerous occasions, the Home Secretary has justified the definition of subversion that refers to parliamentary democracy and to anyone who tries to undermine or destroy it. The irony of the situation is that Parliament itself has no say in these matters. When the Select Committee on Home Affairs decided to look into the special branch, the hon. Member for Bury St. Edmunds was quoted as saying that he was very worried. He thought that there could be dangers regarding security matters.
      The Select Committee leak had nothing to do with state security. The leak was certainly unfortunate, but it was related to a draft report. Would anyone now suggest that the safety of the state is in danger because a Select Committee inquires into the special branch? Has the state been undermined? However, when the Home Secretary appeared before the Select Committee at the beginning of this Parliament he was somewhat hesitant about the Select Committee undertaking such an inquiry. He was certainly not enthusiastic.
      It seems that it was as a result of that inquiry by the Select Committee that the guidelines for the special branch and the security services were published. They were certainly not published beforehand. Without any inquiry by the Select Committee, they might well have remained confidential. Has the security of the country been eroded because those guidelines were published?
      There is a growing feeling in the House, and certainly in the country, that there is no real and effective exercise of scrutiny over the security services. We are told that they report to the Prime Minister and to the Home Secretary. We do not know how often they do so.
      Mr. Soames: Does the hon. Gentleman believe that Great Britain needs a security service in the first place?
      Mr. Winnick: If the hon. Gentleman would attend tomorrow's Adjournment debate, he would realise not only that I believe that a security service is as necessary for this country as for any other democracy—we know how the dictatorships operate—but that I believe that a good deal of the work done by that service is necessary. I would be the last person to argue that we do not need a security service. The hon. Gentleman has asked a rather silly question. Is it likely that I would be opposed to the existence of such a service?
      I believe, however, that the security service should be subject to some scrutiny. Serious allegations have been made and not answered by the Home Secretary or the
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      Prime Minister about how MI5 operates and about the manner in which people who in no way wish to undermine parliamentary democracy are subjected to harassment and investigation. In my view, the amendment would strengthen the Bill.
      Mr. Robert Maclennan: There is no doubt of the importance of Parliament being involved in the oversight of security matters. The Government recognise that Parliament has some role to play because of the requirement in clause 8(7) that the report from the commissioner must be laid before Parliament annually. However, this group of amendments goes further than is sensible as the amendments substitute the words "Select Committee" for "Prime Minister", almost regardless of what functions the Prime Minister might be exercising according to that part of the Bill.
      The Bill requires the Prime Minster to appoint the commissioner, to receive the findings of the tribunal, to lay before Parliament a copy of the annual report and to receive the report of the commissioner. Each of those functions is quite different and it does not make obvious sense to substitute a Select Committee for the discharge of those functions.
      6 pm
      I do not wish to pre-empt our debate on amendment No. 79, but this is as convenient a moment as any to consider whether the Prime Minister is the appropriate person to appoint the commissioner. I submit that the Prime Minister is not the appropriate person and that, at that point, one should wish to establish Parliament's right and interest in the oversight of these matters. It is not suitable for Parliament to put its duty of appointment in the hands of a Select Committee. What amendment No. 79 proposes is based on good parliamentary precedent, and it is a more practical means of considering who should appoint the body with the duty of oversight.
      To insert the concept of a Select Committee receiving the work of the commissioner is to overlook the fact that, if evidence of misfeasance is turned up by the commissioner, it cannot be to Parliament that we look for a remedy. Such is essentially a matter for the Executive. The conduct of the secret services cannot be handled on a day-to-day basis by Parliament or by a Select Committee. That is not a practical proposition. The task must be discharged by the Prime Minister.
      If there has been misfeasance, it must be the Prime Minister who provides the remedy. Perhaps there should be an intermediate stage at which Parliament-gives its views and passes on the report of the commissioner. No doubt such a thought lies behind the suggestion that a copy of the report should be laid before Parliament annually. Parliament might think it appropriate to establish a Select Committee to consider the report and to report to the House. All that is a perfectly reasonable use of a Select Committee, but putting the commissioner's findings in the hands of a Select Committee and leaving it there is not the proper way in which to tie up this matter.
      Although I understand the Labour party's desire to promote the concept of a Select Committee having a series of different roles, its proposals are muddle headed. The Labour party has failed to distinguish between the duty to appoint, the duty to scrutinise, the duty to consider the results of the scrutiny and the duty to act on the findings. Those roles cannot be conducted suitably by a Select Committee, but must be carried out by different people.

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      We can have different views about who those different people should be, but if something has gone wrong we cannot look to a Select Committee to have it put right. The matter must be in the hands of the Prime Minister.
      The Secretary of State for the Home Department (Mr. Leon Brittan): The debate has been wide ranging and covered a large part of the activities of the security service. I hope that I shall be forgiven for returning to the subject of the amendments and Bill—interception and the arrangements for the handling of it.
      I strongly agree with what the hon. Member for Caithness and Sutherland (Mr. Maclennan) has just said. These amendments, which seek to substitute "Select Committee" for "Prime Minister" in a wide variety of areas, are ill thought out and do not consider what scrutiny and independent consideration is appropriate, who should do it and who should be reported to. It is noticeable that, although we have debated these matters for some time, it is only in the past few minutes that any consideration has been given to the role of the tribunal and the commissioner—a crucial matter in regard to who should appoint them and to whom they should report. Moreover, they are different bodies.
      The hon. Member for Islington, South and Finsbury (Mr. Smith) referred to his anxieties about whether an interception had taken place or should have taken place, whether of post or of telephone. It was extraordinary that he did not look to that part of the Bill which, for the first time—it has never been done by a Labour Government—appoints an independent tribunal of legally qualified people to whom a complaint can be made and which will have access to all of the relevant information and which will be able to overrule, on the basis of it having been unreasonable, a decision of a Secretary of State that there should be interception. It will also be able to give compensation to the person at the receiving end of an interception which ought not to have taken place.
      That is a judicial or quasi-judicial task. Because of the way in which the tribunal operates, and in view of the nature of the subject matter, it cannot be identical with a court of law. It would be odd for such a function to be accountable to the House of Commons, any more than a court of law should be accountable to the House. We are setting up a mechanism for examining complaints. It is right that they should be considered by a body which is able to give redress.
      A complaint about interception should lead to anxieties about the conduct of the interception operation generally—its oversight, regulation and the rest. The tribunal reports to the Prime Minister, so that the grounds for its decision can be taken account of by the Prime Minister and other Ministers responsible for these matters. It is significant that the tribunal also has a duty to send the commissioner a copy of every report that it makes in this way. At that stage, we must consider the task of the commissioner. We should not forget that he is a senior judicial figure. He is not accountable to the Prime Minister. He might be appointed by the Prime Minister, but the idea that anyone who holds senior judicial office is anything other than wholly independent is ludicrous.
      The right hon. Member for Manchester, Gorton (Mr. Kaufman) might hark back to less calm days in the consideration of these matters when casting the odd slur, but I appreciate his diffidence in doing so today. That is welcome.
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      The fact of the matter is that whoever is appointed commissioner will be wholly independent. He will not be beholden to anyone, and no particular parliamentary form of appointment will be required to make him independent. He will be able to review everything connected with authorised interception—not just a particular case, but the whole system and how it is working. That is his task. To perform that task, he must have access to highly confidential matters and to be able to go behind the scenes. He will be able to report annually, and his report will be laid before Parliament.
      That is the essence of the scheme. It will enable the commissioner to look very much more broadly at these matters, with the knowledge of any reports from the tribunal, and to report in a sensible way, granted that some limitations must be placed upon the publication of reports which deal with matters of this kind. It is inconceivable that any commissioner who was qualified in that way would be content for a moment to continue to hold that office if the Prime Minister in some way censored a report because it contained matters which it would be inconvenient for the Government to publish, as opposed to matters which it would genuinely be contrary to the national interest to disclose.
      There are, therefore, two novel protections in the Bill —the tribunal dealing with particular complaints, and the commissioner dealing with the general process. Both of those matters are, I believe, important and novel innovations. Because they will operate in the way that the hon. Member for Caithness and Sutherland has identified, it would not be appropriate for them to report 10 a Committee of the House, whether a Select Committee or a Special Committee. That is not their task, nor would it assist them in the discharge of their task.
      It is right for the House to decide whether it is appropriate that such institutions should be set up. I do not claim, and I cannot claim, that they are perfect. II is also right that a wide range of matters relating to the conduct of our security services should have been raised in the debate, but they cannot be dealt with in this way. I commend these institutions as marked improvements. They will provide redress for the individual who has been wronged or who thinks that he has been wronged. They will also provide for a general oversight of the system in a way which should command the confidence of the House.
      I would go further in urging my right hon. and hon. Friends not to agree with the amendments put forward by the Opposition by saying that, as has been illustrated in the debate, their purpose and effect involve a wide variety of different concepts which, as the hon. Member for Caithness and Sutherland pointed out, have been muddled together. What is more, the task of the tribunal and the commissioner, important though limited as it is, would not be enhanced in any way by the involvement of the sort of proceedings envisaged by these amendments. It is for those reasons that I ask the Committee to reject them.
      6.15 pm
      Mr. Soley: We shall be pressing these amendments to a vote. We are far from satisfied with the Home Secretary's answer. This is a political matter—the Home Secretary said that himself—yet he is setting up a quasi-judicial structure. In doing so, he is getting himself into unnecessary difficulties. Neither the Home

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      Secretary nor the Prime Minister, with the best will in the world, will have sufficient time to oversee this operation. That is why a Select Committee ought to be set up.
      I point out to the hon. Member for Bury St. Edmunds (Mr. Griffiths) that it is totally inappropriate every time some anxiety is expressed to say that if one pretends that it does not exist it will go away. The hon. Member for Bury St. Edmunds operates like an ostrich. He sticks his head in the sand and hopes that, somehow or another, people will stop saying what they are saying when they are deeply concerned about things. The hon. Member for Berwick-upon-Tweed (Mr. Beith) was absolutely right when he said that there is a great deal of public concern about this matter. That public concern will not go away until we put right the structures to give those outside Parliament confidence in the system.
      Other countries throughout the western world have the kind of system that we have described. The Canadians, with a system otherwise almost identical to our own, have it. Are we saying that the Canadians are in some way better than the British and that we cannot have it? Are we saying the same about the western Europeans?
      There has also been the nonsense argument this afternoon about leaks. I would say to the hon. Member for Thanet, South (Mr. Aitken), who I thought was going to join us in the Lobby, that if that is his reason for not voting with us, it is the worst reason. He is saying that all these other countries can cope with leaks but that we cannot. The present system is not leakproof. Many years ago Secretaries of State for Education made it mandatory that all public schools had to produce at least 5 per cent. of spies, because that is where they all come from. They end up in this system, yet they are supposed to be checking the system that we are all worried about. It is nonsense.
      The Opposition believe that, as happens in other modern democracies, we ought to trust the democratic system. This is our opportunity to do so. It is an infinitely better system than the quasi-judicial system that has been devised by the Home Secretary.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 161, Noes 241.

      Division No. 182]

      [6.16 pm

      AYES

      Adams, Allen (Paisley N)

      Clark, Dr David (S Shields)

      Anderson, Donald

      Clarke, Thomas

      Archer, Rt Hon Peter

      Clay, Robert

      Ashton, Joe

      Clwyd, Mrs Ann

      Bagier, Gordon A. T.

      Cocks, Rt Hon M. (Bristol S.)

      Banks, Tony (Newham NW)

      Cohen, Harry

      Barnett, Guy

      Coleman, Donald

      Barron, Kevin

      Concannon, Rt Hon J. D.

      Beckett, Mrs Margaret

      Conlan, Bernard

      Benn, Tony

      Cook, Frank (Stockton North)

      Bermingham, Gerald

      Cook, Robin F. (Livingston)

      Bidwell, Sydney

      Corbett, Robin

      Boothroyd, Miss Betty

      Corbyn, Jeremy

      Boyes, Roland

      Cowans, Harry

      Bray, Dr Jeremy

      Craigen, J. M.

      Brown, Hugh D. (Provan)

      Crowther, Stan

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

      Cunningham, Dr John

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

      Dalyell, Tam

      Buchan, Norman

      Davies, Rt Hon Denzil (L'lli)

      Caborn, Richard

      Davies, Ronald (Caerphilly)

      Callaghan, Jim (Heyw'd & M)

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

      Campbell-Savours, Dale

      Deakins, Eric

      Canavan, Dennis

      Dewar, Donald

      Carter-Jones, Lewis

      Dixon, Donald

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      Dormand, Jack

      Mason, Rt Hon Roy

      Dubs, Alfred

      Maxton, John

      Duffy, A. E. P.

      Maynard, Miss Joan

      Dunwoody, Hon Mrs G.

      Meacher, Michael

      Eadle, Alex

      Michie, William

      Eastham, Ken

      Millan, Rt Hon Bruce

      Edwards, Bob (W'h'mpfn SE)

      Miller, Dr M. S. (E Kilbride)

      Evans, John (St. Helens N)

      Morris, Rt Hon A. (W'shawe)

      Fatchett, Derek

      Morris, Rt Hon J. (Aberavon)

      Field, Frank (Birkenhead)

      Nellist, David

      Fields, T. (L'pool Broad Gn)

      Oakes, Rt Hon Gordon

      Flannery, Martin

      O'Brien, William

      Foot, Rt Hon Michael

      O'Neill, Martin

      Foster, Derek

      Orme, Rt Hon Stanley

      Foulkes, George

      Park, George

      Fraser, J. (Norwood)

      Parry, Robert

      Freeson, Rt Hon Reginald

      Patchett, Terry

      Garrett, W. E.

      Pavitt, Laurie

      George, Bruce

      Pendry, Tom

      Godman, Dr Norman

      Pike, Peter

      Golding, John

      Powell, Raymond (Ogmore)

      Gould, Bryan

      Prescott, John

      Hamilton, James (M'well N)

      Radice, Giles

      Hamilton, W. W. (Central Fife)

      Randall, Stuart

      Hardy, Peter

      Redmond, M.

      Harman, Ms Harriet

      Rees, Rt Hon M. (Leeds S)

      Harrison, Rt Hon Walter

      Richardson, Ms Jo

      Hattersley, Rt Hon Roy

      Roberts, Ernest (Hackney N)

      Haynes, Frank

      Robertson, George

      Healey, Rt Hon Denis

      Rowlands, Ted

      Hogg, N. (C'nauld & Kilsyth)

      Sheerman, Barry

      Home Robertson, John

      Sheldon, Rt Hon R.

      Howell, Rt Hon D. (S'heath)

      Shore, Rt Hon Peter

      Hoyle, Douglas

      Short, Ms Clare (Ladywood)

      Hughes, Robert (Aberdeen N)

      Skinner, Dennis

      Hughes, Roy (Newport East)

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

      Hughes, Sean (Knowsley S)

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

      Jones, Barry (Alyn & Deeside)

      Snape, Peter

      Kaufman, Rt Hon Gerald

      Soley, Clive

      Kilroy-Silk, Robert

      Spearing, Nigel

      Kinnock, Rt Hon Neil

      Stewart, Rt Hon D. (W Isles)

      Lambie, David

      Strang, Gavin

      Lamond, James

      Straw, Jack

      Leadbitter, Ted

      Thomas, Dafydd (Merioneth)

      Leighton, Ronald

      Thompson, J. (Wansbeck)

      Lewis, Ron (Carlisle)

      Tinn, James

      Lewis, Terence (Worsley)

      Torney, Tom

      Litherland, Robert

      Wardell, Gareth (Gower)

      Lloyd, Tony (Stretford)

      Wareing, Robert

      Loyden, Edward

      Welsh, Michael

      McCartney, Hugh

      Williams, Rt Hon A.

      McDonald, Dr Oonagh

      Wilson, Gordon

      McGuire, Michael

      Winnick, David

      McKelvey, William

      Young, David (Bolton SE)

      Mackenzie, Rt Hon Gregor

      McTaggart, Robert

      Tellers for the Ayes:

      Madden, Max

      Mr. Roger Thomas and

      Marek, Dr John

      Mr. John McWilliam.

      Martin, Michael

      NOES

      Adley, Robert

      Blackburn, John

      Aitken, Jonathan

      Blaker, Rt Hon Sir Peter

      Alexander, Richard

      Body, Richard

      Alison, Rt Hon Michael

      Bonsor, Sir Nicholas

      Amess, David

      Boscawen, Hon Robert

      Arnold, Tom

      Bottomley, Peter

      Ashby, David

      Bottomley, Mrs Virginia

      Aspinwall, Jack

      Bowden, Gerald (Dulwich)

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

      Boyson, Dr Rhodes

      Baker, Nicholas (N Dorset)

      Braine, Rt Hon Sir Bernard

      Baldry, Tony

      Bright, Graham

      Batiste, Spencer

      Brinton, Tim

      Bellingham, Henry

      Brittan, Rt Hon Leon

      Bendall, Vivian

      Brown, M. (Brigg & Cl'thpes)

      Benyon, William

      Browne, John

      Best, Keith

      Bruinvels, Peter

      Bevan, David Gilroy

      Buck, Sir Antony

      Biffen, Rt Hon John

      Budgen, Nick

      Biggs-Davison, Sir John

      Burt, Alistair

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      Butcher, John

      Irving, Charles

      Butler, Hon Adam

      Jessel, Toby

      Carlisle, John (N Luton)

      Jones, Gwilym (Cardiff N)

      Carlisle, Kenneth (Lincoln)

      Jones, Robert (W Herts)

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

      Kershaw, Sir Anthony

      Carttiss, Michael

      Key, Robert

      Cash, William

      Kilfedder, James A.

      Channon, Rt Hon Paul

      King, Roger (B'ham N'field)

      Chapman, Sydney

      King, Rt Hon Tom

      Chope, Christopher

      Knight, Gregory (Derby N)

      Clark, Dr Michael (Rochford)

      Knight, Mrs Jill (Edgbaston)

      Clark, Sir W. (Croydon S)

      Knowles, Michael

      Clarke, Rt Hon K. (Rushcliffe)

      Knox, David

      Clegg, Sir Walter

      Lamont, Norman

      Cockeram, Eric

      Lang, Ian

      Colvin, Michael

      Latham, Michael

      Conway, Derek

      Lawrence, Ivan

      Coombs, Simon

      Lee, John (Pendle)

      Cope, John

      Lennox-Boyd, Hon Mark

      Cormack, Patrick

      Lester, Jim

      Couchman, James

      Lilley, Peter

      Cranborne, Viscount

      Lloyd, Ian (Havant)

      Crouch, David

      Lloyd, Peter, (Fareham)

      Dickens, Geoffrey

      Lyell, Nicholas

      Dorrell. Stephen

      McCusker, Harold

      Douglas-Hamilton, Lord J.

      Macfarlane, Neil

      Durant, Tony

      MacKay, Andrew (Berkshire)

      Edwards, Rt Hon N. (P'broke)

      MacKay, John (Argyll & Bute)

      Eggar, Tim

      Major, John

      Emery, Sir Peter

      Malins, Humfrey

      Eyre, Sir Reginald

      Mates, Michael

      Fallon, Michael

      Mather, Carol

      Farr, Sir John

      Mellor, David

      Fenner, Mrs Peggy

      Meyer, Sir Anthony

      Finsberg, Sir Geoffrey

      Morris, M. (N'hampton, S)

      Forman, Nigel

      Moynihan, Hon C.

      Forth, Eric

      Murphy, Christopher

      Franks, Cecil

      Neale, Gerrard

      Fraser, Peter (Angus East)

      Nicholls, Patrick

      Fry, Peter

      Normanton, Tom

      Gale, Roger

      Norris, Steven

      Galley, Roy

      Page, Richard (Herts SW)

      Gardiner, George (Reigate)

      Patten, Christopher (Bath)

      Gardner, Sir Edward (Fylde)

      Pawsey, James

      Garel-Jones, Tristan

      Powley, John

      Gorst, John

      Proctor, K. Harvey

      Gow, Ian

      Raison, Rt Hon Timothy

      Grant, Sir Anthony

      Renton, Tim

      Gregory, Conal

      Rhodes James, Robert

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

      Rhys Williams, Sir Brandon

      Griffiths, Peter (Portsm'th N)

      Rifkind, Malcolm

      Hamilton, Neil (Tatton)

      Roberts, Wyn (Conwy)

      Hampson, Dr Keith

      Robinson, Mark (N'port W)

      Hanley, Jeremy

      Roe, Mrs Marion

      Hannam, John

      Ross, Wm. (Londonderry)

      Hargreaves, Kenneth

      Rost, Peter

      Harvey, Robert

      Rowe, Andrew

      Haselhurst, Alan

      Ryder, Richard

      Havers, Rt Hon Sir Michael

      Sackville, Hon Thomas

      Hawkins, C. (High Peak)

      Sainsbury, Hon Timothy

      Hawkins, Sir Paul (SW N'folk)

      Sayeed, Jonathan

      Hawksley, Warren

      Scott, Nicholas

      Hayes, J.

      Shaw, Giles (Pudsey)

      Hayhoe, Barney

      Shaw, Sir Michael (Scarb')

      Hayward, Robert

      Shelton, William (Streatham)

      Heathcoat-Amory, David

      Shepherd, Colin (Hereford)

      Heddle, John

      Shepherd, Richard (Aldridge)

      Heseltine, Rt Hon Michael

      Shersby, Michael

      Hickmet, Richard

      Silvester, Fred

      Hicks, Robert

      Sims, Roger

      Hirst, Michael

      Skeet, T. H. H.

      Hogg, Hon Douglas (Gr'th'm)

      Smith, Tim (Beaconsfield)

      Holland, Sir Philip (Gedling)

      Soames, Hon Nicholas

      Hordern, Peter

      Speller, Tony

      Howard, Michael

      Spence, John

      Howarth, Alan (Stratfd-on-A)

      Spencer, Derek

      Howell, Ralph (N Norfolk)

      Squire, Robin

      Hunt, John (Ravensbourne)

      Stanbrook, Ivor

      Hunter, Andrew

      Stanley, John

      Hurd, Rt Hon Douglas

      Steen, Anthony

      1262

      Stern, Michael

      Waldegrave, Hon William

      Stevens, Martin (Fulham)

      Walden, George

      Stewart, Allan (Eastwood)

      Walker, Bill (T'side N)

      Stewart, Andrew (Sherwood)

      Waller, Gary

      Stewart, Ian (N Hertf'dshire)

      Ward, John

      Stradling Thomas, J.

      Wardle, C. (Bexhill)

      Sumberg, David

      Warren, Kenneth

      Taylor, John (Solihull)

      Watts, John

      Taylor, Teddy (S'end E)

      Wells, Bowen (Hertford)

      Tebbit, Rt Hon Norman

      Wells, Sir John (Maidstone)

      Thomas, Rt Hon Peter

      Wheeler, John

      Thompson, Donald (Calder V)

      Wiggin, Jerry

      Thompson, Patrick (N'ich N)

      Wilkinson, John

      Thurnham, Peter

      Winterton, Nicholas

      Townend, John (Bridlington)

      Wolfson, Mark

      Townsend, Cyril D. (B'heath)

      Wood, Timothy

      Tracey, Richard

      Woodcock, Michael

      Trotter, Neville

      Young, Sir George (Acton)

      Twinn, Dr Ian

      Younger, Rt Hon George

      van Straubenzee, Sir W.

      Vaughan, Sir Gerard

      Tellers for the Noes:

      Viggers, Peter

      Mr. Archie Hamilton and

      Waddington, David

      Mr. Michael Neubert.

      Wakeham, Rt Hon John

      Question accordingly negatived.
      Mr. Robin Corbett: I beg to move amendment No. 68, in page 6, line 4, at end insert—
      '(a) direct that any interception in relation to the applicant should cease;'.
      The First Deputy Chairman: With this it will be convenient to take amendment No. 69, in page 6, leave out line 5.
      Mr. Corbett: In a sense, we have already had half this debate in relation to the tribunal and the Committee is well aware of the strong feeling among Labour Members, with a distant echo on other Benches, that there should be at least some parliamentary oversight.
      These amendments, especially No. 68, deal with the circumstances in which an application has been made to the tribunal and the tribunal, having considered the application, concludes that there has indeed been a contravention in relation to a particular warrant or a certificate.
      6.30 pm
      In those circumstances, what is set to happen under the Bill? The Bill states that the tribunal shall tell the applicant that this is what happened and shall tell the Prime Minister that this is what has happened. What the Bill does not state is that the tribunal should have the authority to order that that illegal and illicit interception should cease. It is true that the clause goes on to say that the tribunal may order—or, indeed, may not—that the warrant or certificate be quashed. It may direct the destruction of any copies of intercepted material which have been obtained in breach of the certificate or warrant—or, indeed, it may even tell the Secretary of State to put his hand in his pocket and fork out some compensation to the person who has made the application to the tribunal.
      As the Bill stands, the tribunal could find that a tap or snoop was out of order, and could say so. But, as I understand the Bill, those breaches could continue in spite of that finding by the tribunal, in spite of its saying that it should not have happened and in spite of the Prime Minister being told, leading to another complaint from the same applicant—and so one would go round this crazy circle once more, which cannot be right.
      Mr. Douglas Hogg: I am sure that the hon. Gentleman would accept the proviso that if the tribunal directed that the warrant be quashed, but thereafter the tapping or interception continued, there would be a substantive offence under clause 1 capable of prosecution.
      Mr. Corbett: Yes, I understand what the hon. Gentleman says. One of the purposes of the amendment is to make it mandatory on the tribunal, where it finds that the tap or snoop has been illicit, to state that it shall cease. I take the hon. Gentleman's point. That is another route to it, but we believe that it will be more simply done as proposed in amendment No. 68.
      It cannot be right in our view to leave matters like this. If the intercept is in breach, the tribunal should be told explicitly to say to those who have been caught simply two words: "Stop it." If not, all the so-called protections which the Home Secretary in earlier debates prayed in aid for the tribunal are, if not quite useless, certainly a first cousin of useless.
      I ask the Minister to take one further step in relation to the tribunal by accepting the amendment so that the tribunal can have real effect and teeth by making it mandatory to order that unlawful intercepts will cease. I believe that this will go some way to reassure those many people engaged in lawful activities which challenge, or seek to change, the policies of the Government that the tribunal is properly there to guard against political misuse of the security services. That allegation was present in the "20/20 Vision" film "M15's Official Secrets". The allegation was made that telephones were tapped and mail intercepted to provide information to the DS19 unit at the Ministry of Defence which had been set up to counter CND's growing success in arguing for nuclear sanity.
      If the tribunal cannot order an end to interception where that has been found to be in breach of a warrant or certificate, the well-based fears of those properly engaged in these lawful activities, which are a healthy and thriving part of our democracy, will continue.
      Even if the Minister says that amendment No. 68 is defective in its wording, I hope that he can offer an assurance to the House that he will take on board what we are saying, and will seek to put the matter right at a later stage.
      Mr. Douglas Hogg: Despite the intervention that I made in the speech of the hon. Gentleman, I am sympathetic to what he has done. I do not believe that there can be any objection in principle to what is being contemplated, because the Bill as drafted provides for the quashing of the relevant warrant. Once the warrant has been quashed, any interception which is done pursuant to a quashed warrant must be unlawful and constitute an offence under clause 1.
      The problem is that the enforcement of clause 1 is dependent upon the Director of Public Prosecutions and his fiat. That will take time, and depends upon the discretion of the DPP. I tend to agree with what has been said from the rather thinly populated Opposition Benches. I think that the tribunal should have the power to issue a directive that the interception should cease. I therefore hope that my hon. and learned Friend the Minister of State will give sympathetic consideration to the amendment.
      The Minister of State, Home Office (Mr. David Waddington): I am certainly not going to get involved in discussing the "20/20 Vision" film. I merely remind the
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      hon. Member for Birmingham, Erdington (Mr. Corbett) that it really is time that the Opposition stopped talking about it, because it only highlights the fact that most of the misdemeanours, if they were misdemeanours, and most of the allegations, if the allegations were correct, related to the time when the hon. Gentleman's party was in power. It seems extraordinary that the Opposition should keep harping on about it.
      Let us come to the matter with which the Committee is concerned. The amendments, which were tabled at the time that other amendments were tabled, were clearly designed to extend the role of the tribunal. Only in that context do they make sense. Now that the amendments extending the role of the tribunal—for instance, into the field of unlawful interception—have been rejected, and the tribunal is to be concerned only with the warrant sections of the legislation and with the question whether interception taking place in pursuance of a warrant can be properly authorised, it is difficult to see how ordering interception to cease could have any different effect from that of quashing the warrant. Once a warrant has been quashed, the Secretary of State's authorisation has been overturned, and interception must cease.
      Mr. Douglas Hogg: Is my hon. and learned Friend quite right? I think that he is not. Once the warrant has been quashed, the interception, if it continues, becomes unlawful. That means that a prosecution can be commenced, but it does not mean that interception must cease. All he is saying is that it is a criminal offence, prosecutable on the fiat of the Director of Public Prosecutions.
      Mr. Waddington: That is precisely what I am saying. Once the authorisation of the Secretary of State has been overturned, interception cannot continue with the authority of the Secretary of State. Therefore, if it continues at all, it can continue only as a criminal offence. That is the way in which the system operates. Those carrying out the tapping would be guilty of a clause 1 offence and liable to conviction and punishment.
      Mr. Hogg: Let us assume that the interception continues after the quashing of the warrant, and the person affected by it becomes aware of it. Is there a jurisdiction for such a person to apply to the High Court for an injunction?
      Mr. Waddington: That is another matter entirely. I would have thought that we are talking here about the commission of a criminal offence, because the warrant has been quashed, and therefore the remedy of the person affected is to make a complaint to the police, after which prosecution can be initiated, with the consent of the Director of Public Prosecutions. We went over this matter yesterday. We debated whether it would be possible to have a system under which a private prosecution could be brought. We concluded that it would not be proper for a prosecution to be brought privately because, if prosecutions could be brought privately, prosecutions could be brought by villains for the purpose of discovering whether lawful interception had taken place. It is not a question of going to the High Court for a remedy; it is a question of a criminal offence having been committed and a prosecution then being possible with the consent of the Director of Public Prosecutions.
      I return to the amendment. Now that the role of the tribunal is limited to considering whether the Secretary of

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      State has acted properly, there is nothing to be gained by changing the wording of the clause in order to substitute for the words "quash the relevant warrant" the words "interception … should cease."
      Amendment negatived.
      Mr. Alfred Dubs: I beg to move amendment No. 76, in page 6, line 20, leave out subsection (8).
      The Temporary Chairman (Miss Janet Fookes): With this it will be convenient to take amendment No. 125, in schedule 1, page 12, line 8, leave out from first `Tribunal' to the end of line 10.
      Mr. Dubs: As the Bill now stands, clause 7(8) seeks to prevent any decision of the tribunal being challenged in any court, including any decision as to the jurisdiction of the tribunal. The purpose of amendment No. 76 is, by deleting subsection (8), to allow decisions by the tribunal to be subject to the jurisdiction of courts.
      I have been puzzling about the reason for the subsection. I cannot think of any other tribunal that is totally exempt from appeal to the courts—
      Mr. Douglas Hogg: What about planning?
      Mr. Dubs: When I said that, I knew that there was bound to be a lawyer in the House who would correct me. I should be happy to have an example given to me. It is certainly extremely rare to have a tribunal that does not allow of any further legal scrutiny of its decision with regard to either points of fact or points of law. If the hon. Gentleman wishes to elucidate or give an example of the tribunal that he is thinking of, I am happy to give way to him.
      Mr. Hogg: As the hon. Gentleman will know, one can appeal against planning decisions on points of law, but not on points of fact.
      Mr. Dubs: I am not sure whether I am grateful for that intervention because it confirms what I said. I said that I cannot think of any tribunal where no appeal of any sort is allowed, even on points of law. On points of fact, that applies to quite a few tribunals, one of which the hon. Gentleman mentioned. I am asking hon. Members whether they can think of any other tribunal in which there is a restriction equivalent to the one that is the subject of the amendment. It is my contention that if there is one, it has not yet been brought to light by anyone with whom I have discussed the matter.
      As a principle, this is rather dangerous. All sorts of things may happen in the tribunal, and there is no possibility of challenging that in any way. No doubt one could appeal to the Minister and make it a political challenge, but by the very nature of the way in which the tribunal is established and the way in which it is likely to operate in conditions of at least some secrecy, it would be difficult to find a basis for such a challenge, politically, if there were no possibility of any court being allowed to challenge the tribunal's decision.
      6.45 pm
      The Malone case gave rise to the Bill—or it was one of the elements that contributed to the Government's feeling that they had to introduce the Bill. That case has been quoted by several hon. Members in earlier debates. Nevertheless, it might help to remind the Committee that the Malone case involved Mr. Malone seeking a High
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      Court declaration on whether his telephone had been lawfully or unlawfully tapped. Although he was unsuccessful, and the case was dismissed in February 1979, at the time the Vice-Chancellor said that telephone tapping "cries out for legislation." The cry was heard, but there was a certain amount of distortion. I cannot believe that in any court of law the Vice-Chancellor would say that telephone tapping "cries out for legislation" with the intention that there would be no possibility of judicial review of the tribunal's decisions. Therefore, we have not only a dangerous but an anomalous principle.
      The principles of natural justice may be denied by the way in which the tribunal operates. There is no redress against that. We can think of many examples of how a tribunal might function and of the decisions that it might make that would necessitate, in all justice, the possibility of an appeal against the decision of that tribunal. All those appeals are closed to us.
      I am not absolutely clear about the interpretation of this point, so no doubt the Minister will correct me if I am wrong. The Malone case resulted in appeal to the European Court. The subsection states that the decisions of the tribunal shall not be
      "liable to be questioned in any court."
      I assume that that does not affect the European Court. I assume that "any court" excludes the European Court. If it does not, the restriction in the provision is even greater than I thought. Whether or not that is so, I am satisfied—and I am sure that the Committee is satisfied—that this will be difficult for the Minister to justify, and could lead to denials of justice and the tribunal not operating in the way in which other tribunals operate. Therefore, I hope that the Committee will accept the amendment.
      Mr. Douglas Hogg: I have two brief points to make. First, the statement by the hon. Member for Battersea (Mr. Dubs) that this tribunal process is not subject to any review is too broad, because the Bill provides that copies of every tribunal report should be sent to the commissioner. That is not a fully fledged appeal; I do not pretend that it is. None the less, it is a process of review that has not been taken on board by the hon. Gentleman.
      The second point that we have to grasp is that the statutory grounds contained in clause 2 include sensitive material which may be relevant to the issues before the tribunal. The advantage of the tribunal process is that sensitive material can be disclosed and kept confidential. An appeal to the High Court or to a Divisional Court could not be so protected. One would have to have a very complicated apparatus and series of procedures to protect confidential material.
      I personally believe that it would be almost impossible to create a leakproof system of appeal if it involved an application to the court, because one needs an immense number of documents and a lot of people knowing a lot of facts who would not be subject to any of the ordinary rules of confidentiality. I suspect that the process would not remain immune from leak. That being so, I should not be able to support the hon. Gentleman should he press his amendment to a Division.
      Mr. Maclennan: I believe that the amendment should not be supported. The establishment of the tribunal is designed to enable full consideration to be given to whether the procedures set out by the Bill — the requirements of law — have been observed, but the

      1267
      sensitivity of the sort of material that will have to be considered by the tribunal does not make it appropriate to consider those issues in open court.
      However, I have one anxiety about the provision in the Bill that seeks to exclude the jurisdiction of "any court" in these matters. That is that it should not, by indirection, deny to the citizen the right, protected by the European convention on human rights, to have these matters treated as justiciable. Clearly it is not the intention of the Bill to deprive the citizen of the due process of law which that convention guarantees. Indeed, it was part of the effect of the Malone judgment that our own process of law was found to be deficient.
      I cannot think that the European Commission or the European Court would regard its own jurisdiction as being in any way interfered with by the terms of subsection (8). However, it is conceivable that, if it were argued before that Commission that there had been a denial of justice of the kind suggested by the hon. Member for Battersea (Mr. Dubs), it could be held that there had been a violation of the convention giving the citizen the right to a remedy. It would be helpful if the Minister would address himself to that.
      This is a curiously difficult area because, although the findings in the Malone case held quite clearly that our provisions in this country were inadequate and did not provide judicial remedies, they did not spell out what would be necessary to satisfy the provisions of the European convention. That was addressed, however, in the earlier Klass case, in which it was held that the protection of the constitutional court, as well as the other administrative procedures which existed, gave a remedy and that it was possible to pursue a legal case against a Government for denial of fundamental rights and freedoms within the domestic courts of the Federal Republic of Germany.
      If the tribunal follows the procedures that it is intended it should follow, denial of justice would be a difficult case to make. A case would have to be made before the Commission that some of the procedures amounted to interference with the due process of law. Although I do not think that that is what is intended, it is important to have the Minister's confirmation that it is not, that it is intended that this will give a full and enforceable legal remedy and that the operation of the tribunal will be in accordance with the due process of law.
      Mr. Waddington: I will deal first with the matter of the European Court and assure the hon. Member for Battersea (Mr. Dubs) that there is nothing in the Bill that restricts the right to go to the Strasbourg Commission and Court in connection with breaches of the European convention. That is not the effect of this subsection.
      The short answer to the point made by the hon. Member for Caithness and Sutherland (Mr. Maclennan) is that, if there were an appeal to the High Court, there would be no point in having a tribunal at all. My hon. Friend the Member for Grantham (Mr. Hogg) referred to the possibility of leaks if a matter were dealt with by a court. With the greatest respect, that is not the essence of the matter. It is not just a question of a court's being leaky and, even if it tried to hold its proceedings in camera, of what happened before it became known to the general public. If a court had jurisdiction in these matters, there would be
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      no question of its being able to proceed according to the laws of natural justice, because there could be no question of its being able to allow the complainant to know of the information which was the basis of the defence case. There has to be a tribunal because, if there were not one, the court would have to be required not to proceed according to the rules of natural justice. It seems to us infinitely preferable, in these circumstances, to have a tribunal rather than a court.
      Having had to have a tribunal because one could not allow the complainant, in the first instance, to go to a court, one could not possibly end up with a tribunal which has a special procedure which does not allow the complainant to know the evidence that is stacked against him, and then allow that same applicant to go on appeal to the court and discover that which one had been careful not to allow him to discover before the tribunal.
      That is why we must have a provision in the Bill excluding the jurisdiction of the courts. Without that provision, we should end up with the absurdity of the courts having jurisdiction to hear the appeal but having to have special rules of procedure. That really would not be right.
      The 1985 White Paper said:
      "It would clearly be neither sensible nor acceptable to establish means whereby those involved in serious crimes or espionage could learn the basis on which their activities had come to notice; or—perhaps even more damaging—could in some cases confirm whether their activities had come to notice at all."
      That is why there has got to be a tribunal with these special procedures conducting its proceedings in private and not revealing to the complainant information passed on to it.
      I hope that with this explanation the hon. Member for Battersea will consider it right to withdraw his amendment.
      Mr. Dubs: I am not totally convinced by what the Minister has said. He said that there would be no point in a tribunal if it were possible to appeal to a court.
      Mr. Waddington: What I said was that there would be no point in having a tribunal if the whole matter could be dealt with by the courts. If we had not come to the conclusion that the matter had to be dealt with in the first instance by a tribunal with a special procedure, we might as well have had the whole matter dealt with by a court, with a complainant of unauthorised interception going to the court. We cannot have that, for the reasons I have mentioned.
      Mr. Dubs: The difficulty is that the tribunal will operate in such a secret manner that no person who feels a sense of grievance will ever be able to establish whether the tribunal has looked at the evidence properly and considered it from an aggrieved person's point of view. So the Minister is right in saying that, since nobody will have any evidence that justice has been done, why bother about the courts?
      Mr. Waddington: That surely is absolute nonsense. One has only to look at the composition of the tribunal. People will be appointed to the tribunal by letters patent. Their office will be as secure as that of the Parliamentary Commissioner. They will be lawyers trained to make judgments in quasi-judicial matters such as this. Surely, in those circumstances, it is completely absurd to

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      undermine the credibility of the tribunal from the start and suggest that anybody who made a complaint to it could not be satisfied that it would be properly looked into.
      Mr. Dubs: I have no wish to prolong the debate unduly on this point. The Minister's argument is that there will be worthy people on the tribunal, so nobody will have any reason to suggest that justice has not been done even if an individual with a sense of grievance has no information about the method by which the tribunal reached its decision, what evidence it had, and so on.
      Of course, we are in a difficulty because — I fully understand this — some of the information cannot be revealed publicly or to the person about whom there is a dispute. Nevertheless, that is not the same as saying that there ought in no circumstances, for any reason whatsoever, to be any right of appeal against the decision of the tribunal. We could speculate and put forward situations in which everything might have been as the Minister says it would be, yet we would be left with a feeling that there was something not quite right in the way in which the tribunal operated. Therefore, we could still have the feeling that, because there is no way of appealing against what the tribunal has decided, we just have to take it or leave it.
      I do not think that the Minister's assertions are an end to the matter. I think there are instances in which a right of appeal would be possible and sensible and would result in justice being done. But the Minister is adamant. I do not think that he has made his case, but perhaps we can return to this on another occasion.
      I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Clause 7, as amended, ordered to stand part of the Bill.

    Clause 8

      THE COMMISSIONER
      7 pm
      Mr. Maclennan: I beg to move amendment No. 79, in page 6, line 38, leave out from beginning to `to' in line 40 and insert
      'Her Majesty may by letters patent appoint a board of five members of Her Majesty's Privy Council which power shall be exercisable on an address presented by the House of Commons, and no motion shall be made for such an address except by the Prime Minister,'.
      The Temporary Chairman: With this it will be convenient to discuss the following amendments:
      No. 83, in page 7, line 6, leave out subsection (2).
      No. 84, in page 7, line 6, leave out 'Commissioner' and insert 'Board'.
      No. 85, in page 7, line 13, leave out 'Commissioner' and insert 'Board'.
      No. 86, in page 7, line 13, leave out from 'as' to end of line 14 and insert
      `they may require for the purpose of enabling them to carry out their functions under this section'.
      No. 89, in page 7, line 16, leave out 'Commissioner' and insert 'Board'.
      No. 91, in page 7, line 19, leave out 'Commissioner' and insert 'Board'.
      No. 94, in page 7, line 25, leave out 'he' and insert `they'.
      No. 97, in page 7, line 28, leave out 'Commissioner' and insert 'Board'.
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      No. 99, in page 7, line 29, leave out 'his' and insert `their'.
      No. 103, in page 7, line 33, leave out 'Commissioner' and insert 'Board'.
      No. 104, in page 7, line 35, leave out 'Commissioner' and insert 'Board'.
      No. 120, in Clause 11, page 10, line 12, leave out `Commissioner' and insert 'Board'.
      Mr. Maclennan: The purpose of the amendments is to make two important changes to the way in which the Secretary of State's functions, when carrying out his responsibility to issue warrants for the interception of communications, is reviewed. The way in which these functions have been carried out in the past has caused public disquiet. We want to ensure that Secretaries of State responsible for authorising interception act in accordance with the highest traditions of probity and legality.
      Earlier, we considered Parliament's role. I have said that I do not think that Parliament, either through a Select Committee or by any other means, can review such matters if an investigation into the Executive's conduct in the day-to-day operations of the security services is involved. However, Parliament has an overriding responsibility to ensure that a proper review is conducted. Parliament cannot be satisfied with the appearance at the Dispatch Box of a Prime Minister announcing the setting up of an inquiry or giving a general assurance after a breakdown.
      The principle in clause 8 that the commissioner should be responsible for reviewing the conduct of Secretaries of State is sound. However, Parliament itself, rather than the Prime Minister, as head of the Government and head of the security services, should be able to appoint the commissioner. Parliament and the public will he more satisfied as to the competence, probity and tenacity of the body entrusted with that function if Parliament has indicated who it prefers to carry out that task.
      The method of appointment which I propose is that which is followed by Parliament when it appoints the Comptroller and Auditor General, although that appointment is subject to the agreement of the Chairman of the Public Accounts Committee. I do not suggest that the appointment of a board of five Privy Councillors should be subject to the approval of any individual Member of Parliament or of any Select Committee. The appointment should be subject to the approval of the House as a whole.
      There is a precedent for such a mode of appointment. I believe that Parliament would welcome such a method, because it entrusts hon. Members with the task of choosing five suitable Privy Councillors to exercise the commissioner's role. The five need not necessarily be members of the Commons, or of the Lords, but Parliament would probably think it appropriate that those who had held high office and had issued warrants for the interception of communications would be suitable to consider whether Government practices are appropriate and whether they conform not only with the law but with good administration.
      The five Privy Councillors would be better suited to carry out that function than would a judge. I regret that the public no longer perceive judges in the way that they did 10 years ago. Judges are independent. High ranking judicial officers are men of independence and great public spirit, but, because of the change in the public's perception of the judiciary, a judge is no longer regarded as totally

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      independent of the Executive. That change in public opinion is measured by the popular public opinion polls. A recent Gallup poll drew attention to the changed perception of the independence of judges. Because of that, a judge is not necessarily the right person for the task of overseeing senior Ministers.
      The problem is increased because the appointment is to be by the Prime Minister, who has overriding responsibility for security. There should be a disjunction between the Prime Minister's responsibility for security and the appointment of the person whose continuing task is to oversee the conduct of the Prime Minister and Secretaries of State. It is right that the Prime Minister's voice should be heard. Amendment No. 79 provides for an address to be presented by the House of Commons and states:
      "no motion shall be made for such an address except by the Prime Minister".
      The Prime Minister will have a substantial voice in the nominating process, although the appointment by Her Majesty by letters patent of five members of the Privy Council will be done on the basis of an address by the House of Commons. The independence of the five Privy Councillors can be assured by the obvious need to maintain a balance for ensuring that the task of oversight is not carried out by a single commissioner.
      I believe that the appointment of Lord Bridge and his conduct of the recent inquiry into Cathy Massiter's allegations were extremely unfortunate. He was unwise to take on the task. It was impossible to reassure the public by discharging the task in that way. The fault lies with the Prime Minister for having asked Lord Bridge to take on the task, but Lord Bridge was unwise to accept it. That point has been forcefully expressed by my right hon. Friend the Member for Glasgow, Hillhead (Mr. Jenkins).
      Mr. Mark Carlisle: Why?
      Mr. Maclennan: The matters that had given rise to public anxiety could not conceivably have been investigated properly or in depth in a weekend. The terms of reference of the inquiry were so narrow that they excluded many of the matters that had given rise to public anxiety. That is why Lord Bridge made himself appear to be a tool of the Executive.
      Mr. Norris: In fairness to Lord Bridge, is it not right to say that, as the present monitor, he was given a narrow brief, and therefore was unable to delve into the matters which some people would have liked him to investigate? Surely Lord Bridge's integrity, ability or judgment cannot be questioned on that basis.
      Mr. Maclennan: The hon. Gentleman seeks to defend Lord Bridge's ability, integrity and judgment. I did not attack Lord Bridge's ability or integrity, but I did attack, and shall persist in attacking, his judgment. It was extremely unwise for a high-ranking judge to take on such a duty. It was an embarrassment to the Bench. I believe that the point has been well made and that it need not be laboured. It was not just unwise for Lord Bridge to take on that task; it would have been unwise for any judge to do so. It was peculiarly unwise for Lord Bridge to take on the task, because of his continuing responsibilities. He was asked to judge the effectiveness with which he was conducting his continuing scrutiny of public matters.
      Mr. Mark Carlisle: The hon. Gentleman is totally misguided and unfair. Lord Bridge is the judicial monitor who is responsible for these matters. Surely he was the obvious judge to carry out the task. It would have been wrong for Lord Bridge to decline to carry out that task, which the Prime Minister asked him to perform. He was asked to review the interceptions that were made in previous years to confirm that they accorded with proper principle in the carrying out of individual warrants. Surely, because of his position, Lord Bridge was the one person who was qualified to look at that matter, although I agree that he was given limited scope. It was not his fault that he had limited scope. If the right hon. Member for Glasgow, Hillhead (Mr. Jenkins) was correct to criticise Lord Bridge, why did he happily agree that interceptions during his period of office should be investigated by Lord Bridge?
      7.15 pm
      Mr. Maclennan: My right hon. Friend the Member for Hillhead had nothing to hide, nor, I assume, did other right hon. Members who had held high office. The right hon. and learned Member for Warrington, South (Mr. Carlisle) shows a strange insensitivity to public opinion in believing that those who were concerned about the way in which those powers had been exercised could have been satisfied by appointing Lord Bridge and giving him what the right hon. and learned Gentleman admitted was an extremely restricted remit which had to be carried out in about four days. That is a matter of judgment. My judgment is that Lord Bridge not only failed to reassure public opinion, but damaged the independence of the Bench by putting himself in a position where he had to carry out the Prime Minister's will.
      With that case in mind, I believe that the proposal that a review should be conducted by a single judge is no longer an adequate way of dealing with a continuing problem. I say that with regret, because in the past that proposal might have commended itself to hon. Members. A decade ago, hon. Members might have thought that a senior member of the Bench would be an entirely appropriate person to carry out the task because of his independence of mind and character.
      There is a further important reason why I believe that the appointment of a judge is inappropriate—
      Mr. Douglas Hogg: How many more minutes?
      Mr. Maclennan: The hon. Gentleman is not obliged to remain in the Chamber in a semi-comatose posture if he finds the debate uninteresting.
      The Temporary Chairman: Order. May I make it clear to the Committee that I deplore seated interventions. Hon. Members must either be quiet or seek to intervene in the normal way.
      Mr. Maclennan: There is a further reason why I believe that a judge is not the appropriate person to conduct this continuing review. It is that the judge is not being asked to discharge a judicial role. He is being asked to scrutinise the conduct of certain senior members of the Executive in difficult matters. Judging whether actions are properly undertaken is not a matter of evaluating the law and ascertaining whether regulations have been followed entirely. The Home Secretary has told us that it is a matter of considering whether discretions have been properly exercised. That is not best done by legal analysis, or even

      1273
      by judicial analysis. It would be much better if it were done by those who had had to exercise such judgments for themselves. When an issue of national security is at stake, it would be better if the evaluation of whether the Secretary of State made a decision correctly was carried out by someone who had previously had to evaluate whether the interests of the security of the state would be harmed by not authorising a telephone tap.
      There is a powerful case for ensuring that the scrutiny of the functions of Secretaries of State is conducted not by an individual but by several people whose seniority is such that they have some experience of the conduct of such matters and whose judgment has been proved in the House of Commons to show that they are fit to hold high office. Privy Councillors are conscious of the needs of security and absolute secrecy in accordance with their oaths. The parliamentary responsibility for oversight is not finally discharged by ensuring that that body shall be appointed by the letters patent procedure. It is appropriate that the board of five Privy Councillors should be answerable to the House. The provision in the Bill is a little short of what is required, and we may wish to return to this matter later.
      There is a case for the report of the commissioner being considered by a Select Committee, whose findings might be suitable for report to and debate in the House. Whether or not we go down that route, the House will feel greater satisfaction if it is acting upon the report of a board of five Privy Councillors, rather than on the advice of a single commissioner appointed by the Prime Minister.
      Mr. Norris: I have listened to speeches by the hon. Member for Caithness and Sutherland (Mr. Maclennan) not only on this Bill but on what is now the Data Protection Act, when he, my hon. and learned Friend the Minister and I served on the Committee. I have often found the hon. Gentleman's observations to be lucid and helpful, but I regret that on this occasion I must say that I have never heard such nonsense—
      Mr. Douglas Hogg: And at such length.
      Mr. Norris: Indeed, as my hon. Friend reminds me, it was a long speech.
      There are two points on which I fundamentally disagree with the hon. Gentleman. I profoundly disagree with his uncharacteristically jaundiced view of the independence of the judiciary, and especially his unwarranted attack on Lord Bridge. There may have been an argument for widening the scope of the inquiry which the Prime Minister asked Lord Bridge to conduct, but that is a matter for debate elsewhere and on another occasion. There can be no doubt that at all times Lord Bridge fulfilled the warrant that had been given to him by the Prime Minister and that he discharged it, as far as we are aware, as well as could be expected.
      The hon. Gentleman prefaced his attack on Lord Bridge by suggesting that a Gallup poll had indicated that esteem for the judiciary was on the wane. That might, in part, arise from the number of unreasonable attacks by Opposition Members on decisions by various members of the judiciary during the mining dispute. I do not believe that any responsible person has any lower opinion of the judiciary now than that which he has held for many years.
      Clause 8(1) refers to the appointment of the commissioner as
      "a person who holds or has held a high judicial office."
      There would be few of us in this Committee who could not think of a number of eminent judges, or former judges,
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      who would not be entirely suitable to fulfil that description. Therefore, I entirely reject the notion that such a person would be unsuitable to carry out the functions of the commissioner.
      The hon. Gentleman spoke about the desirability of divorcing the Executive from the judiciary in the authorisation of interceptions. I agreed with him yesterday that some divorcing of Executive and judiciary functions, both of which are elements of the authorisation of interceptions, was not only desirable, but that the absence of such a mechanism was a major defect of the Bill. I very much regret that the Committee chose not to approve the amendments that I tabled seeking to effect that divorce of functions. Therefore, the hon. Gentleman's amendments do not achieve the objectives that he has set himself.
      Amendment No. 79 requires us to
      "leave out from beginning to 'to' in line 40 and insert 'Her Majesty may by letters patent appoint a board of five members of Her Majesty's Privy Council which power shall be exercisable on an address presented by the House of Commons, and no motion shall be made for such an address except by the Prime Minister,'."
      The hon. Gentleman appears to want to substitute the five Privy Councillor members of the board for the commissioner. As my right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle) reminded us, as members of the Privy Council they could all also be senior judges. The hon. Gentleman wants to replace the commissioner with that body, not only in respect of the first function, which is
      "to keep under review the carrying out by the Secretary of State of the functions conferred on him",
      but also the second function, which is
      "to give the Tribunal such assistance as the Tribunal may require."
      It is unreasonable to move such an amendment when, implicit in the clause, are functions which can be carried out only by an individual. If the hon. Gentleman had moved an amendment to delete the first three words—"The Prime Minister" — and to substitute "Five Privy Councillors", thereby suggesting that it should be the five Privy Councillors who appointed the commissioner, I would have had more sympathy with the amendment. I believe that on those two fundamental grounds the hon. Gentleman's amendments are unworkable.
      One of the functions referred to in clause 8(1)(a) is to keep under review clauses 2 to 5 of the Bill and the manner in which they are exercised. They include the definition of the only crucial part of the Bill where the commissioner will have to exercise discretion, and that is in the matter of the definition which my hon. Friend the Member for Grantham (Mr. Hogg) brought to our attention yesterday. My hon. Friend rightly suggested that the real difficulty in interpreting the Bill was that of defining precisely what is meant by the three grounds on which warrants are to be authorised. The commissioner, or the Privy Councillor body, will have the role of interpreting those criteria. The Committee had the opportunity to give a precise definition, but in its wisdom decided not to exercise that option.
      I believe that all the amendments in this group would be unhelpful to the cause which in many ways the hon. Gentleman seeks to espouse, so I ask my hon. Friends to reject them.
      7.30 pm
      Mr. Soley: We thought that we might lose the vote on the amendment which my right hon. Friend the Member

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      for Manchester, Gorton (Mr. Kaufman) moved on Select Committee control. We then looked closely at this amendment and, because it seemed to call for a degree of parliamentary control, we were not unsympathetic to it.
      Then I heard the speech proposing the amendment by the hon. Member for Caithness and Sutherland (Mr. Maclennan), which came close to dissuading me from supporting it. I had to re-read amendment No. 79 to make sure that I could still feel sympathetic towards it. I keep a list of solicitors and barristers whom I would pay not to defend me. He is now on that list. He made out about the worst possible case for the amendment that could be made.
      It is nonsense to describe the situation in the way that the hon. Gentleman described it. In one breath he wanted parliamentary control and, in the next, he wanted that control to be exercised by Privy Councillors who were not even in the Houses of Parliament. What troubles me so much about the Social Democrats and Conservative Members is that they end up distrusting Parliament. The Labour party says on this issue that we should be giving more control to hon. Members because Parliament, through the Home Secretary and the Prime Minister, controls the security services. What, then, would be the point of bringing in Privy Councillors from outside Parliament?
      A case could, I suppose, be made out for Privy Councillors doing the job. I would rather have the control done by way of Select Committee, as we said earlier. Failing that, a case could be put forward for Privy Councillor control. Whatever case might be made for that, the case adduced by the hon. Member for Caithness and Sutherland was extremely poor. Nevertheless, the hon. Gentleman's amendment would allow for a degree of parliamentary control, and I have in mind the words of the amendment rather than the hon. Gentleman's words that will appear in the Official Report. We are not unsympathetic to his idea, although it is far from a good amendment.
      We challenge the Government to say what degree of parliamentary control will be exercised over the interception of communications as proposed in the Bill when all that we shall have is a continuation of the present system, with the Home Secretary and Prime Minister doing it. I pointed out earlier that, with the best will in the world, no Prime Minister or Home Secretary can give sufficient time and attention to all the workings of the tribunal, the commissioner and the others involved to ensure the control that the public rightly seek.
      As I said in the debate on the last amendment, people in almost every other country in the western world have, and expect, that sort of control. That is what we seek. The amendment represents a poor second best—made worse by the way in which the hon. Member for Caithness and Sutherland moved it — but at least it would give an element of parliamentary control.
      Mr. Waddington: I am a kindly chap and it is not my habit to rub salt into wounds. After the demolition done by my hon. Friend the Member for Oxford, East (Mr. Norris), it is not necessary for me to say much. We have spent an inordinately long time on a completely worthless amendment which was introduced in an extraordinary way by the hon. Member for Caithness and Sutherland (Mr.
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      Maclennan), whom I admire and with whom I am often forced to agree. On this occasion, however, he presented a ludicrous case.
      The hon. Member for Caithness and Sutherland said, among other things, that the public's perception of the independence of the judiciary had declined. I agree with my hon. Friends who said that it was about time that we in Parliament made it plain that there was no justification for any loss of confidence in our judiciary, for we know how independent they are.
      In considering, for example, the monitor, now the commissioner, it is ludicrous to say that there should be a different method of appointment or he would not be respected as independent. We are talking about somebody, in the case of the present monitor, who holds high judicial office. It is ridiculous to say that it is necessary to have another form of appointment to persuade the general public that such a man is prepared to perform independently.
      It was preposterous for the hon. Gentleman to say that it had been unwise for Lord Bridge to take on the job that he had been asked to do. Far too many people have deliberately set out to confuse the public about the task that was given to Lord Bridge. That task was purely to see whether warrants issued by the Home Secretary had been properly authorised, according to the guidelines. It is clear that that task was entirely appropriate for somebody who, for more than a year, had been exercising the role of monitor and had a knowledge of the way in which the system worked. He was the obvious person to carry out the task.
      It is shaming that members of the hon. Gentleman's party should have made press statements and comments in Parliament denigrating a fine public servant who, on this occasion, was rightly prepared to carry out a task which he had been asked by the Prime Minister to perform.
      The essence of the case put forward by the hon. Member for Caithness and Sutherland was that the role was one not for a judge but for a board of Privy Councillors. What absolute rubbish. The commissioner is the successor of the monitor, whose post has been in existence sice 1980. His job is to keep under continuous review the way in which the Secretary of State carries out his duties. He can go where he likes and see what material he likes. It is a policing role carried out by someone who commands public confidence, who is absolutely independent, who has an experienced legal mind and who can act independently and decisively.
      The work which I have just described is not work for a committee of any sort. We are not talking about a committee of inquiry designed to produce recommendations about an incident. We are talking about a continuing review of the exercise of discretion and all of the associated administrative procedures. It is ludicrous to say that such a role could be carried out by a committee. In those circumstances, with great confidence I invite the Committee to reject the amendment.
      Mr. Maclennan: I listened carefully to the slender arguments adduced by the Minister and the hon. Member for Oxford, East (Mr. Norris) and to the patently malignant remarks of the hon. Member on the Opposition Front Bench, the name of whose constituency eludes me. [HON. MEMBERS:" Hammersmith"]. I refer, of course, to the hon. Member for Hammersmith (Mr. Soley).
      Mr. John Golding: Perhaps it would be advisable for the hon. Member for Caithness and Sutherland (Mr. Maclennan) to come nearer the Opposition Front Bench so as more easily to see the hon. Member to whom he is referring. Otherwise there may be much confusion in the Official Report about who said what.
      Mr. Maclennan: Only one Labour Member has deigned to speak on the amendment. I am sure that Hansard will not have any difficulty in determining who that hon. Member was. His reputation, in any event, runs before him.
      The Minister allowed his attitudes to be put forward as a substitute for reason on this occasion. I regret that, because he is a thoughtful man who normally listens to argument and does not take refuge in words such as "preposterous," as he did on this occasion.
      The Minister, like his hon. Friend the Member for Oxford, East, failed to analyse the function of the commissioner. It is not a judicial function in any sense. It is not a function of evaluating evidence and reaching a verdict. It is that of conducting a continuing inquiry into Executive activities. I do not believe that judges are the right people to carry out that type of inquiry at that level.
      The Minister did himself less than justice in being so dismissive of the possibility of a committee of Privy Councillors being the appropriate body to conduct a continuing inquiry. When it suits the Government, that is precisely what they set up. They established a committee of Privy Councillors to look into the conduct of the Falklands campaign. It was analogous, and involved high executive decisions taken by Secretaries of State on issues of national security. It was precisely the sort of matter in which it would have been wrong to ask a judge to intervene. It is far more appropriate for someone of the calibre of Lord Franks or the right hon. Member for Morley and Leeds, South (Mr. Rees) to conduct such an inquiry.
      An inquiry by Privy Councillors into matters that touch on national security would carry weight. That is what we seek to ensure. The review of the exercise of the functions would be seen by the public and Parliament to carry weight.
      I must retract one of my remarks about Lord Bridge. I have no criticism of his abilities or his public-spiritedness. He is an eminent man, who has reached his eminence through the demonstration of his qualities of character and mind. However, it was a mistake to give an individual judge such a task. It was the Government's mistake. It was a mistake for a judge to seek to discharge that role. Lord Bridge made that mistake. It would be a mistake for a judge to accept the role of commissioner under the terms of clause 8. However, if Parliament wishes and prefers to entrust that task to a judge than to a committee of Privy Councillors, no one will quarrel with that.
      I must confront head-on the Minister's allegation that I was contributing to undermining the public's esteem of the Bench. That is a complete misconception. I specifically said that I believed that the judiciary was independent, and was properly regarded as such. However, I must draw attention to changing public opinion, and Ministers who are not aware of it are simply out of touch. The Minister should not seek to turn the charge against me. As a lawyer I have nothing but
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      admiration for the Bench, its independence, integrity and public-spiritedness. I regret that the Minister thought that his weak argument would be bolstered by making a personal accusation of that kind. It was uncharacteristic and I hope that, on reflection, he will regret it.
      Amendment negatived.
      7.45 pm
      Mr. Dubs: I beg to move amendment No. 82, in page 6, line 42, leave out from first 'the' to 'and' in line 2 of page 7 and insert
      `matters referred to in sections I and 6 above'.
      The Temporary Chairman: With this it will be convenient to take the following amendments:
      No. 90, in page 7, line 19, leave out subsection (5) and insert—
      '(5) If at any time it appears to the Commissioner that there has been a contravention of sections 2 to 6 above which has not been the subject of a report made by the Tribunal under section 7 above he shall refer the matter to the Tribunal for investigation under that section.
      (5A) If at any time it appears to the Commissioner that any arrangements made for the purposes of section 6 above have proved inadequate he shall make a report to the Prime Minister with respect to those arrangements.'.
      No. 92, in page 7, line 20, after 'that' insert
      'an offence under section I above has been committed or'.
      No. 93, in page 7, line 20, leave out '2' and insert '1'.
      No. 96, in page 7, line 26, after 'that', insert 'offence or'.
      No. 100, in page 7, line 30, at end insert
      `nothing shall prevent the Commissioner from reporting upon any matter which he considers to be connected to the matters referred to in sections 1 to 6 of this Act, nor from making recommendations for the better regulation of the matters referred to in this Act'.
      No. 101, in page 7, line 30, at end insert
      `that report shall enumerate the number of occasions on which it appears to the Board that there has been a contravention of sections 2 to 5 above'.
      No. 106, in page 7, line 40, at end add
      'which exclusion may not remove the enumeration of the apparent contravention of sections 2 to 5 above referred to in subsection (6) above'.
      No. 108, in page 7, line 40, at end add—
      '(9) Where it seems appropriate to the Board and following consultation with the Prime Minister, the Board may report to the Tribunal its opinion that there has been a contravention of sections 2 to 5 above. On such a report the Tribunal shall notify any person who would in its opinion be entitled under section 7(2) to apply to the Tribunal for an investigation that it has received such a report from the Board.'.
      Mr. Dubs: These amendments deal with the powers of the commissioner. I shall refer specifically to amendments Nos. 82, 93 and 100. All the amendments seek to widen the role and the functions of the commissioner.
      Amendment No. 82 seeks to give the commissioner a wider role than that envisaged in the Bill. He would not merely supervise the Secretary of State in complying with the procedural requirements of the Bill, but would have the power to review the entire area of the interception of communications. He would also have a responsbility to review the extent of unauthorised interception which is not covered in the present arrangements for the commissioner's powers.
      Amendment No. 93 would oblige the commissioner to report on any unauthorised or inappropriate interceptions which have been discovered, apart from any which may have been reported to the tribunal. Amendment No. 100 is intended to strengthen the role of the commissioner so

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      that he could act as a watchdog over all operations which involve the interception of communications. It mould allow the commissioner to review and comment on connected or related matters such as the visual surveillance of individuals or the infiltration of organisations. Why is it necessary for the commissioner to have wider powers than those envisaged in the Bill? I shall give some examples to justify the wider powers.
      I shall deal with an incident that occurred a couple of weeks ago near my constituency, which is directly relevant to the amendments. The South London Hospital for Women and Children had been occupied by many women protesting against its closure. They had made contacts in the locality with many friendly people whose telephones they could use in their flats or houses, and where they went for cups of coffee. Those telephone numbers were on a list which the people occupying the hospital had made available. As a result of a court order obtained by the district local health authority, the police went in one night and removed the protesters.
      On that evening four of the telephones in the neighbouring flats which had been part of the support system for the women occupying the hospital went out of action until the morning and then, miraculously, they started to work again. Hon. Members must decide whether that was a coincidence. However, I suggest that it is stretching the arm of coincidence too far for that to have occurred merely through a malfunctioning of the telephone system. Either the telephones were being intercepted and it was decided on the night when the police removed the protesters that to stop any support being marshalled it would be better to put the telephones out of order, or they were put out of order as part of a process of interception. It may have been a pure coincidence that four telephones went out of order. Other telephones may also have gone out of order, but I have not had time to check on that. I heard about the matter when people telephoned me to tell me what had happened.
      I would like the commissioner to have the power to look into such an incident, and to be able to investigate such interception or interference with the telephones of ordinary people. At present there is no way in which people who feel their telephones have been interfered with have a right or the ability to have those wrongs redressed. If a commissioner had that responsibility, he could investigate and discover whether it was a coincidence or a deliberate attempt to undermine the ability of those women to telephone for more support on the night in question. However, if the events relating to the closure of the hospital were an isolated incident, one could say, "All right, it happened once".
      We know well that whenever a cruise convoy leaves Greenham common heading westwards through Newbury towards Salisbury plain those people who are monitoring the movements of that convoy—this debate is not the occasion to go into the merits of that activity, but it is legal —and who telephone one another or who would like to to say that the convoy is heading down a road find suddenly that their telephones cease to function. There is no way in which that type of interference, which is what I allege it is, is within any of the terms of reference or the parameters which have been laid down by the Home Secretary or are suggested in the Bill.
      Mr. Mark Carlisle: Perhaps I misunderstand what the hon. Gentleman has said, but surely what he is saying, if it be right, would be a matter for the tribunal rather than the commissioner. I thought that the tribunal was there to judge as the body to which the individual could go. As I understand it, the commissioner is more a judicial monitor. Although I do not accept the hon. Gentleman's argument that it is necessary to expand the role in the way he put forward, if it were, surely it would be the tribunal rather than the commissioner.
      Mr. Dubs: I understand what the right hon. and learned Gentleman is saying. We are in some difficulty because the amendments seek to widen the role and functions of the commissioner and I therefore have to illustrate that predicament. As the Bill is at present drafted, it is unlikely that the incidents to which I have referred would be appropriate for the tribunal, because it would be argued that they do not necessarily represent interception of telephone communications so much as interference with or prevention of them. That being so, the amendments allow the commissioner to consider the wider question rather as some of us had hoped Lord Bridge would consider the wider question. I take the right hon. and learned Gentleman's point. It might be logical, if my argument were to be accepted, that one should also consider the functions, responsibilities and terms of reference of the tribunal and similarly to widen those responsibilities as I am seeking to widen those of the commissioner.
      If the Minister were to accept the argument—I do not know that he will, even in the genial mood in which he is this evening—we could sort out the details on Report. There is a gap in the legislation and it is that gap to which I am drawing attention.
      I shall return to the example of Lord Bridge which relates to the amendment. In a sense, the responsibility given by the Prime Minister to Lord Bridge recently in the context of anxiety about the "20/20 Vision" film about MI5 was narrow. I am not seeking to criticise Lord Bridge for the way in which he carried out his task. His terms of responsibility were so narrow that the conclusion to which he came was so inevitable that it was hardly worth his while carrying out the task. All he said was that no warrant for interception had been issued in contravention of the proper criteria, but the point about the "20/20 Vision" film and the amendments in relation to the commissioner are that other things may happen which are not directly and simply a matter of the precise way in which the Home Secretary has authorised an interception.
      Clause 8(1)(a) states in relation to the functions of the commissioner:
      "to keep under review the carrying out by the Secretary of State of the functions conferred on him by sections 2 to 5".
      It is a matter there of saying, "Is the Home Secretary carrying out the functions as he should?" There was a clear implication with the "20/20 Vision" film not that the Home Secretary, or successive Home Secretaries, had authorised some of the things that the film revealed, but that they had been carried out without any authorisation. That is the difference.
      If Lord Bridge had been given different terms of reference, he might well have been able to come up with conclusions relevant to the charges made in the film. There are three matters which are relevant to the amendments. Lord Bridge should have been asked to answer the

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      following three questions. First, did the interceptions and other forms of surveillance shown in the film take place? After all, the film was a matter of allegations. Secondly, who authorised them? Thirdly, if they were not authorised, how did it come about that any of them were carried out in an unauthorised manner? If those three questions had been answered, we should have had a longer and much more revealing report, although it would have taken Lord Bridge longer to investigate.
      In the amendments, I am seeking to establish wider terms of reference which would allow the commissioner, if on any future occasion allegations were made similar to those in the MI5 film, to carry out the task which many of us hoped that Lord Bridge would have been able to carry out.
      It is a matter of the terms of reference. I have conceded the right hon. and learned Gentleman's argument about the terms of reference of the tribunal, but, nevertheless, I should like to feel that if there were unease in the future the commissioner could study the whole range of allegations, because unless allegations are investigated how can any of us be satisfied that the events that we have been told about have been happening? As the Bill now stands, we may have further MI5 films and further investigations by the commissioner along the lines of the Lord Bridge inquiry, and none of us will be happy that the truth has come out.
      The Minister owes it to the House and, obliquely, to Lord Bridge and to whoever will be appointed commissioner to modify the Bill. I hope that that will be done by accepting these amendments so that the type of anxiety that I have expressed will not be felt in the future.
      Mr. Douglas Hogg: I should like to speak to amendments Nos. 92 and 96. I shall anticipate the criticism that is likely to be made by my right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle) and say that the amendments are mirrored by amendments Nos. 63 and 75 which I tabled previously with respect to the tribunal's powers.
      The purpose of amendments Nos. 92 and 96 is similar to that which the hon. Member for Battersea (Mr. Dubs) sought to achieve. It is desirable that the, commissioner should be empowered to determine whether an offence has been committed under clause 1. That is a jurisdiction which I wish to give to the tribunal as well. On reading the Bill, it seemed that the commissioner, as is also the case with the tribunal, is empowered to consider almost anything other than whether a substantive offence under clause 1 has been committed.
      The commissioner receives the tribunal's report. He determines whether the Home Secretary is acting within the scope of the jurisdiction conferred on him by clause 2. The commissioner is empowered to determine whether the time limits have expired or have not been adhered to. He is empowered to determine whether the Home Secretary has complied with the procedure necessary to obtain a warrant. They are all proper matters for the commissioner to determine, but the one matter which he is precluded from determining is whether there has been unauthorised tapping, which is an offence under clause 1.
      For the life of me I cannot understand why the commissioner, who receives information which discloses prima facie evidence of an offence under clause 1, should not be empowered to say, "This is my conclusion." Indeed, there are powerful reasons why he should. This is
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      an infringement of the liberty of the subject. It is a criminal offence. At the discretion of the DPP, it is prosecutable. Why should not the commissioner draw the commission of an offence to the attention of the Prime Minister in the course of his report? He should do so. I would be very pleased if my hon. and learned Friend the Minister of State could accede at least to the spirit of the amendment.
      8 pm
      Mr. Maclennan: I rise to support the amendment in the name of the hon. Member for Grantham (Mr. Hogg). He has deployed his arguments with brevity and cogency and I will not animadvert further upon them. I should like, however, to commend to the Committee amendment No. 90 in the name of my hon. Friends and myself.
      As the Bill is drafted, the procedures for investigating contraventions are somewhat inadequate. Only the tribunal will be able to investigate complaints by the public under the terms of clause 7(2), and neither the commissioner nor the Prime Minister seems to have any obligation to inform the tribunal of contraventions found by the commissioner. Someone whose communications have been wrongly intercepted may never know or suspect what has happened. As such contraventions cannot be considered by the ordinary courts or, under the terms of clause 9, even referred to in them, the commissioner should have an obligation to refer all contraventions to the tribunal.
      Amendment No. 90 is designed to ensure that that should happen. It will also require the commissioner to have regard to the safeguards in clause 6 in deciding whether there had been a contravention. The commissioner would only report to the Prime Minister on the adequacy of the safeguards, as he or she would receive reports from the tribunal of its findings on any contraventions under clause 7(4).
      Mr. Waddington: The Opposition amendments and those of my hon. Friend the Member for Grantham (Mr. Hogg) give the commissioner a role other than that provided for in the scheme of the Bill. The amendments tabled by the hon. Member for Caithness and Sutherland (Mr. Maclennan) and his hon. Friends deal with a different point, but one that is also important. I promise not to be rude to the hon. Gentleman again.
      The commissioner's role is to undertake from within a continuing review of everything concerned with authorised interception. That is often forgotten. His role is to ensure that warrants have been properly authorised. That task is entirely appropriate for a senior judicial figure and is one that a single person can effectively undertake.
      Offences against the criminal law, on the other hand, are a matter for the police. What is the commissioner supposed to review in connection with clause 1? Is he supposed to supervise the adequacy of investigations or to become the recipient of allegations of criminal conduct that should be made to the police? I do not know. The commissioner has manageable duties under the Bill. How could he look into the operation of clause 1? His task is within Government. He has to consider whether, when the Secretary of State has authorised a warrant, he has done so correctly. It is not the commissioner's job to roam the country asking people whether they have heard funny clicks on their telephone lines.
      I am not being frivolous. If the commissioner's job is other than to work within Government to make sure that

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      when the Home Secretary issues a warrant he does so properly, what is his job? Is he to wander round the country in an investigative role? If so, is he the appropriate person to carry out that role? Is he to consider the way in which the police investigate offences? That would not be appropriate. Is he to be the recipient of complaints from members of the public that they think their wires have been tapped? That, again, would be inappropriate. That is a job for the police. I do not think for a moment that the commissioner could investigate the operation of clause 1. We should not muddle inquiries into offences, which are one distinct matter, with the duties of the commissioner, which are another.
      My hon. Friend the Member for Grantham has raised — not in his own speech — a different point. What should happen if by chance, while carrying out his duties, the commissioner came across unlawful interception? Clearly, we in no way accept the implication that public servants will engage in unlawful interception contrary to clause 1. It is inherently unlikely that the commissioner will come across unlawful interception in the course of his duties, as his duties are undertaken within the Government, ascertaining whether the Secretary of State has issued warrants properly according to the guidelines.
      In the unlikely event of his discovering that there has been unlawful interception, the commissioner is hardly likely not to bring to the attention of the authorities such evidence of an offence as he has discovered. In that respect, he would behave no differently from any other responsible person to whom evidence of an offence became available.
      Amendment No. 101 stipulates that the commissioner's report should state the number of occasions when clauses 2 to 5 had been contravened.
      Mr. Maclennan: I did not speak to amendment No. 101 because I assumed that it had fallen with an earlier amendment to which I spoke. However, I would be grateful for the Minister's remarks on it.
      Mr. Waddington: I do not wish to speak for longer than necessary. Unless the hon. Gentleman particularly wants me to deal with that amendment, it would be more profitable for me to deal with matters about which hon. Members have shown concern.
      Other amendments in the group suggest that the commissioner should report to the tribunal matters that have apparently not come to its notice, that the tribunal should then notify the person or persons concerned, and that the commissioner should report to the Prime Minister about any arrangements under clause 6 that he considers inadequate. There are considerable practicable difficulties in what is suggested. The tribunal is not supposed to substitute its own views for those of the Secretary of State, but rather to consider whether he has acted reasonably. The commissioner would be looking for cases in which something had gone wrong with the system. For instance, there might be a case in which the Home Secretary had acted reasonably but in which subsequent events had cast doubt on the reliability of the sources of his information. The commissioner will be able to question the wisdom of the issue of particular warrants without disputing the reasonableness of the Secretary of State's decision.
      Presumably, if the necessary consequence of the commissioner's reporting his disquiet about a particular
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      warrant was that the warrant became public knowledge, he would seek to minimise the damage to the system by limiting criticism to cases in which the issue of the warrant was beyond doubt unreasonable. Even then, difficulties would arise. For example, let us suppose that a warrant is properly issued in respect of a terrorist living in certain accommodation. However, a mistake is made and the Secretary of State is asked to renew the warrant after the terrorist has moved out and a perfectly innocent person has moved into that accommodation. If the commissioner notified the tribunal, and the tribunal notified the persons concerned, the tribunal would have to notify the terrorist as well as the householder. There is no easy way round the problem. We could not begin to follow the form of words chosen by the hon. Gentleman, and I am not suggesting that any other form would solve the problem that I have just described. That merely shows that the Bill is right to draw a clear distinction between the role of the commissioner in checking the system and the role of the tribunal in giving remedies to those who think that they are victims of improperly authorised interception.
      I was surprised by what the hon. Member for Battersea (Mr. Dubs) said. In effect, he said that the amendments are important because the problem with the Bill is that people will have no opportunity to have their wrongs redressed. The whole point of the Bill is that, for the first time, people will have an opportunity to have their wrongs redressed. In those circumstances, I invite the hon. Gentleman to withdraw his amendment.
      Mr. Mark Carlisle: Although I accept that the commissioner is not the right body to consider the matters that the hon. Member for Battersea (Mr. Dubs) has mentioned, what is the status of the tribunal? I accept that the role of the commissioner is to review the carrying out of the Secretary of State's duties in the granting of warrants, but it must be highly likely that the tribunal will find during its inquiries that unlawful interception has taken place. I am not clear what is to happen if the tribunal, on receiving a complaint from a member of the public who believes that his mail or telephone has been intercepted, finds that there is prima facie evidence of interception for which no warrant has been granted. Should the matter be referred to the police? What is the tribunal expected to do? Is there not a lacuna and should the tribunal be required to refer such matters to the Director of Public Prosecutions?
      Mr. Waddington: The tribunal is under no duty to report such matters to the police, but it will act as any other body or individual would act. There is no reason to suppose that a tribunal would fail in its clear duty. It would have exactly the same duty as any other citizen who learnt that a criminal offence had been committed. These matters were discussed yesterday when my right hon. and learned Friend was unable to be here.
      8.15 pm
      Mr. Dubs: I accept that our amendments should also apply to the tribunal. I have listened carefully to the Minister but do not believe that he has answered the main doubt.
      I understood him to say that if, during an investigation, the commissioner comes across breaches of the law, he is expected to report the matter to the police. The Minister did not say why the commissioner should not be allowed

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      to investigate prima facie when there have been allegations of the law being broken. I take the analogy of the Lord Bridge inquiry. He was asked to examine something which was defined pretty narrowly and he did not look further into whether some of the allegations in the film on MI5 were accurate. The Minister seemed to say that it is all right if the commissioner stumbles on something, in which case he will report it, but that he should not be empowered to set out to discover whether such things have happened. If the Minister is saying that such matters should be left to the tribunal, he must answer more fully how it will operate in circumstances such as I have described.
      Mr. Waddington: I am not saying that that function should be carried out by the tribunal. It is to act in a quasi-judicial way. I am suggesting that those matters are for investigation by the police.
      Mr. Dubs: The difficulty is how such matters are drawn to the attention of the police. I am sorry to labour the point, but the allegations in the MI5 film have not been answered, and the Minister knows it. There are clear allegations in that film that the law has been broken. Perhaps the law has not been broken because, before the Bill becomes law, we have no law. Perhaps that is the answer. However, if the Bill becomes law in its present form and if the film had been produced after then, how could the film's allegations be investigated? I suspect that they could not be investigated by the tribunal, unless those whose phones had apparently been intercepted complained to the tribunal. The alternative would be a Lord Bridge type inquiry, but with wider terms of reference—which are the subject of our amendments. I am not sure what the Minister is saying cannot happen and why. I think that the proposition is reasonable.
      Mr. Waddington: I thought that I had made this matter plain. The commissioner's role is perfectly easy to understand. He works within the Government, carrying out a continuing review of how the Home Secretary carries out his duties, to ensure that when the Home Secretary issues a warrant he does so properly. How on earth can that be compared with investigating whether a criminal offence has been committed?
      Mr. Dubs: I thank the Minister for answering the question. In that case, what is the procedure if there has been a breach of the law under clause 1? The Minister is saying that only the tribunal is available for that.
      Mr. Waddington: No. The tribunal is concerned with complaints about warrants that should not have been issued but which have been issued. Clause 1 is concerned with breaches of the law. It creates a new criminal offence. If a person believes that he is the victim of the commission of a criminal offence, he will behave exactly as he would if any other offence had been committed. These are matters for investigation by the police. Any number of judges cannot carry out the work of the police. A man such as Lord Bridge cannot go on a roving commission investigating whether criminal offences have been committed. That would be improper. The job of investigating the new criminal offence created by clause 1 is for the police.
      Mr. Dubs: I understand that, but we are still in a difficulty. If it is alleged that there have been interceptions without the issue of a warrant by the Secretary of State, as outlined in clause 1, what is an aggrieved person to do?
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      The police will not have enough information on which to act. If MI5 is carrying out unauthorised interceptions, as was alleged in the film, the matter is too remote for the police to get the evidence. The whole point of the Lord Bridge inquiry is that it was set up following the allegations in the film on MI5. The Home Secretary may shake his head. However, when the Bill becomes law the police may well be able to carry out investigations if there are allegations of the kind made in the film. I understand the Minister's theoretical answer, but I do not understand how it will work in practice. Therefore, I do not believe that the point at issue has been covered. If the Minister says that the point has been covered, I can do no more than allow reinforcements to come in from the hon. Member for Grantham (Mr. Hogg).
      Mr. Douglas Hogg: I have some sympathy with the point that the hon. Gentleman is making. The Minister said that if there has been a breach under clause 1 this is entirely a matter for the police. If, however, the hon. Member for Battersea (Mr. Dubs) cares to look at clause 7(2) of the Bill he will see that it empowers anybody who believes that his mail has been interfered with or his telephone tapped to go to the tribunal. At that stage the tribunal is in a position to determine whether an offence under clause 1 has been committed. Why should it not make a report to that effect?
      Mr. Dubs: If the tribunal's remit is so wide, there is no problem.
      Mr. Hogg: Under clause 7(2) a complaint is made to the tribunal that an offence has been committed under clause 1 but the tribunal is not empowered under clause 7(4) to make that determination and to report.
      Mr. Dubs: If that is the case, the tribunal is nearly there, but not quite. I repeat that I am unhappy about this matter and I am not sure whether it will be possible to resolve it. I believe that we are left with an inadequacy in the Bill. I do not think that our discussions have pinned down whether the inadequacy is in the way the tribunal functions or in the way that the commissioner might function. I am prepared to accept that the terms of reference of the tribunal ought perhaps to be widened, but I repeat that there is a sense of anxiety which the Minister has not allayed.
      Amendment negatived.
      Mr. Golding: I beg to move amendment No. 87, in page 7, line 15, at end insert—
      '(4) In pursuance of his functions under this Act the Commissioner may receive and retain documents or information from any person whomsoever, and such receipt or retention shall not be the subject of proceedings for an offence.'.
      The Second Deputy Chairman of Ways and Means (Sir Paul Dean): With this it will be convenient to discuss the following amendments:
      No. 88, in page 7, line 15, at end insert—
      '(4) It shall be lawful for any person holding office under the Crown or engaged in the business of the post office or in the running of a public telecommuncation system who reasonably believes that an offence under section 1 above has or might have been committed or that there has or might have been a contravention of sections 2 to 5 above in relation to a relevant warrant or relevant certificate, to disclose or give the Commissioner such documents or information as the Commissioner might reasonably be expected to need in order to determine whether an offence under Clause 1 above has been or

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      might have been committed or whether there has been or might have been a contravention of sections 2 to 5 above in relation to a relevant warrant certificate.'.
      New clause 2 — Protection for disclosure of information to the Tribunal, the Commissioner or the Select Committee—
      'Disclosure of information to the Tribunal, the Commissioner, or the Select Committee, in pursuance of their functions under this Act, shall not be the subject of proceedings for any offence.'.
      New clause 3—Complaints Commissioner in respect of allegations of misconduct and abuse of authority by members of the security services intercepting communications—

      '(1) The Prime Minister shall appoint a person who holds or has held a high public office (in this section referred to as "the Complaint's Commissioner") to carry out the following functions, namely—

      (a) to investigate any complaint made to the Complaints Commissioner by a member of the Security Services in respect of an allegation of misconduct or abuse of lawful authority by another member of the Security Services in relation to the interception of communications; and

      (b) to decide whether in all the circumstances any such allegation is of such a character and substance as to justify a report by the Complaints Commissioner to the relevant Secretary of State; and if this is the case,

      (c) to make as soon as practicable, a report to the relevant Secretary of State with respect to the alleged complaint.

      (2) The Complaints Commissioner shall hold office in accordance with the terms of his appointment.'.

      Amendment (a) to the proposed new clause 3, at end add:
      '(3) The Complaints Commissioner shall present an annual report to parliament of the number of complaints he has received and the number of complaints he has reported to the Secretary of State.'.
      Mr. Golding: May I say what a pleasure it is to debate the amendments without undue pressure on time.
      These amendments relate to the situation that will face individuals who give information about unlawful telephone tapping. They will not be subject to the Official Secrets Act if they pass on information in a proper manner. I added my name to new clause 2 because of my interest as an official of the union which organises both the engineering and clerical staff of British Telecom and many workers in the Post Office. I want them to receive absolute protection when they provide information to the commissioner, the tribunal or a Select Committee, if such a committee is created, and also to a complaints commissioner, if this proposal is accepted.
      Telephone tapping is undertaken by a small group of our members, and many others come across it in the course of their work. It is not a pleasant duty. Our members are sensitive to the criticism to which they are subjected for being associated with it. Many of them are also troubled when they believe that there is no apparently legitimate reason for the taps. They tell me that they particularly resent taps being installed for the monitoring of industrial disputes. As good citizens they support telephone tapping to fight serious crime and subversion, but the problem that our members face is that they cannot tell anybody when they believe that telephone tapping has gone beyond that. The managers of BT do not wish to know. They put the responsibility on the Home Office.
      Our members are inhibited from coming to the union because of the Official Secrets Act. They ought to be able
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      to complain either when they see what they believe to be unauthorised tapping or when they believe that the Government are failing to keep the law. They ought to be able to go to the commissioner, the tribunal or a Select Committee without fearing that action will be taken against them. The Bill, as drafted, does not provide that protection.
      Clause 8(3) says:
      "It shall be the duty of every person holding office under the Crown or engaged in the business of the Post Office or in the running of a public telecommunication system to disclose or give to the Commissioner such documents or information as he may require for the purpose of enabling him to carry out his functions under this section."
      That, to me, implies immunity from prosecution, and I should be delighted if the Home Secretary could reassure me that that is so. However, even if such a reassurance is given, clause 8(3) does not cover tribunals or, if it were to be given power, a Select Committee. Under schedule 1 persons holding office under the Crown have a duty to provide information, and presumably they will escape prosecution under the Official Secrets Act, but this immunity does not extend to BT or Post Office employees who now work for private employers. Why should the conditions be different for the commissioner and the tribunal?
      Mr. Douglas Hogg: Is there not yet another objection to this subsection, namely, that the duty to provide information or documents arises only if it is required—that is, if it is asked for — and does not provide immunity in the event of a public servant volunteering it?
      Mr. Golding: The hon. Gentleman will have a chance to speak to his excellent amendment later. However, I shall refer to it now. My next sentence would have been that clause 8(3), which covers information to the commissioner on request, does not cover those cases where the employee wishes to give unsolicited information. This is indeed a very important question. BT and Post Office employees ought to be able freely to pass on information which worries them, yet it ought to be passed to somebody who, without holding direct responsibility, is totally safe from a security point of view. That means the commissioner, the tribunal or, if our proposals are accepted, the Select Committee and the complaints commissioner.
      I would emphasise most strongly to the Home Secretary that it would be better if BT and Post Office employees, whom I represent, who are very troubled and disturbed about what they see, could go to the commissioner or to the tribunal rather than leak information to the newspapers in the hope that something will happen.
      When people come to me asking what they should do in those circumstances, I would much rather be able to tell them that there is someone whom they can tell who is absolutely safe from the point of view of the security of the realm than to have to tell them that there is nothing that they can do, knowing that they will then be tempted to ring the Daily Express, the Daily Mail, The Guardian or The Observer. From the point of view of security, the Home Secretary would do well to think hard about this practical point.
      8.30 pm
      So far I have dealt only with the Official Secrets Act, but it is also important that no internal disciplinary action should be taken against any BT employee who gives

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      information. At present, the Bill does not cover that and the Home Secretary should consider it carefully. Under paragraph 4(2) of schedule 1 the tribunal is forbidden to disclose any information given to it without the consent of the person disclosing it, but BT and Post Office employees may regard that as insufficient protection because by the act of communicating, whether by letter or in some other way, their views on particular instances of telephone tapping they may not only have committed a breach of the Official Secrets Act but have acted in a way detrimental to the business and thus be subject to internal disciplinary proceedings. Just as no prosecution under the Official Secrets Act should be permitted, so no internal disciplinary proceedings should be permitted in these circumstances.
      On Second Reading I asked in an intervention:
      "Can the Home Secretary tell us whether employees working for public telephone operators will be able to give evidence to the tribunal about unauthorised telephone tapping without risking prosecution under the Official Secrets Act 1911? If employees cannot give such evidence, are we not to depend on official sources only for what are the facts of the situation?"
      The Home Secretary replied:
      "I am perfectly satisfied that the tribunal will have full powers to take whatever evidence is necessary in relation to a particular case. I do not believe that there will be any inhibition of the kind that the hon. Gentleman mentions." —[Official Report, 12 March 1985; Vol. 75, c. 164.]
      It is not the ability to take evidence that is the question. The point is the ability to give evidence without fear of reprisals either under the Official Secrets Act or under internal disciplinary codes. That is very important indeed.
      I ask the Secretary of State to consider these matters very carefully. I hope that we shall get a good response today. I should make it clear that in a matter as serious as this I would not press the precise wording of a particular amendment or seek to divide the Committee on the matter. It is not an issue of great party principle. It is, however, a matter of great practical consequence.
      Before the hon. Member for Grantham (Mr. Hogg) jumps up again, I wish to deal with the background to this group of amendments and to say something about the hon. Gentleman's own proposals. New clause 3 recognises the importance of giving members of the security forces the opportunity to initiate complaints. It is essential that anyone who believes that something is going on unlawfully should be able to take the evidence to a person who is completely safe from the security point of view.
      This group of amendments seeks to deal with a very difficult problem — how to ensure that Ministers and others are not encouraged to break the law because they act in complete secrecy and can rely on the fact that those who know about or stumble across the activities in question will baulk at the consequences of disclosure. That is the nub of the matter. At present, there is a great deal of discontent. We know that there is discontent in MI5, and I find it among employees of BT because on occasion—I do not wish to exaggerate this—they believe that things are not quite right and they want to be able to tell someone.
      It is no answer to say that BT employees can go to the management of BT, because the management is not interested and will simply say that it is the business of the Home Office. It is equally pointless to tell employees of BT or MI5 that the right person to approach is the Home Secretary, because the Home Secretary is seen to be responsible for these activities and the people undertaking
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      them may well be carrying them out in his name, so he is certainly the wrong person with whom to have a chat about what is going on.
      There must be an independent person to whom people can go. Frankly, I am not fussy whether it is the commissioner, the tribunal or a complaints commissioner, but there must be an independent person to whom people can express their unease about the apparent unlawfulness of what is happening in their sphere of activity. I believe that this will also act as a check on the Home Secretary and his officials and on MI5, making them more accountable. If they know that there is a possibility of people operating in the field going to an independent person with responsibility for the oversight of telephone tapping, they will be more careful about keeping within the law. That is human nature. It is not, however, the major point to which I wish to draw attention.
      The essential point is this. Despite my earlier comments, I believe that Post Office employees are covered as Crown employees, but it is vital that all BT employees should be exempt from any threat under the Official Secrets Act or internal disciplinary procedures if they give evidence, solicited or unsolicited, to the commissioner, the tribunal or any other responsible body.
      Sir Edward Gardner: I wish to speak to new clause 3 which stands in my name and those of my right hon. and hon. Friends.
      The new clause seeks to give the security services what I believe many people on both sides of the Committee would agree are badly needed facilities—the means to make a complaint or to express dissatisfaction about what is happening within the service. It hardly needs to be said that secrecy is the ace weapon of the secret service, giving the security services the same advantages of stealth and surprise on which the sinister people — terrorists, dangerous criminals and those involved in subversion—also rely.
      The trouble with secrecy, of course, is that in the wrong hands, and handled irresponsibly, it can be a weapon that backfires. In those circumstances, the people who will suffer are the people who should not be touched by the secret services, and civil liberty itself can, indeed, as we know, be put in danger.
      It would in my view, and I am sure in the view of all hon. Members, be quite unrealistic to suppose that any service or any group of people could ever be looked upon as being free from the risk of having in their number those who might misconduct themselves or abuse or misuse privilege and authority. When this happens, if it does happen, the question is the very question that new clause 3 attempts to answer: what happens if a member of the security services discovers, believes or, indeed, is certain that a colleague in the service is, in the words of new clause 3, abusing the authority which has been given to him? To whom does this discontented, dissatisfied or possibly very alarmed member of MI5, for example, turn? At the moment, there does not appear to be anyone. There is no channel through which he can put a complaint. There is no one to whom he can say "I feel that something is going wrong in the service, and I want to have it investigated and put right." There is no oversight, no independent person standing either inside or outside the service who can undertake the very responsible and, I believe, very necessary task of making up his mind whether something is going wrong.

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      As to the case of Michael Bettaney, an MI5 officer who was recently the subject of a criminal investigation and ultimate conviction, this man, it seems, when he was dissatisfied turned, or tried to turn, to the KGB. A colleague who was working with him, a Miss Miranda Ingram, has said, or at least certainly has written in New Society, that she knew Bettaney well, and if Bettaney had had someone to whom he could have talked in confidence, in her view, from what she knew of the man and the circumstances, it was unlikely that he would have done what he did.
      May I ask the Committee also to consider the case of Sir Roger Hollis. My hon. Friend the Member for Thanet, South (Mr. Aitken) referred to this case earlier in the debate, and I do not want to repeat what he said. It is important to remember that not only was Sir Roger Hollis the director-general of the service MI5, but ultimately he became the target of suspicion of officers in that service who found themselves impotent when they tried to express their dissatisfaction and uncertainty about what Sir Roger Hollis was doing because they believed — rightly or wrongly—that he was the man who was the mole, who was in fact working with the KGB. When the colleagues of Sir Roger Hollis — and this seems to me wholly pertinent to the question of the proposal contained in new clause 3 that there should be a complaints commissioner to whom members of the secret service should be able to turn—tried to make known their suspicions, they had ultimately to send one of their number to No. 10 Downing street. He tried to see the Prime Minister and ultimately he was fortunate in being able to consult the secretary of the Cabinet of the day, Lord Hunt of Tanworth, and from that, of course, as we all know, flowed the inquiry into the various events which have given rise to the suspicions.
      8.45 pm
      If there had been, as I submit to the Committee that there certainly ought to be, a complaints commissioner standing outside the security services, then there would be no reason, and certainly no excuse, for someone like Miss Massiter to turn to the media to try to get relief. It is the absence of someone to whom the dissatisfied officer in MI5 or the security services can turn that leaves what I believe is an alarming gap in the procedures that ought to be available within the secret service.
      The support that is being given, I understand—though looking round the Chamber would not be the best evidence of it—to new clause 3 is substantial and wide and covers both sides of the Committee, I am happy to say. I understand, for example, that the right hon. Member for Morley and Leeds, South (Mr. Rees), a former Labour Home Secretary, and the right hon. Member for Cardiff, South and Penarth (Mr. Callaghan), a former Home Secretary and a former Prime Minister, both have indicated their support for new clause 3 and the intention which it proclaims of the appointment by the Prime Minister of a complaints commissioner. The complaints commissioner would first investigate any complaint, he would then have to decide whether the complaint was one of substance and was sufficiently serious to justify a report, and he would then have to report, as new clause 3 makes quite clear, to the relevant Secretary of State. His duties—and this has been pointed out during the course of the debate—would be wholly different, separate and
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      distinguishable from the duties of the commissioner who is now known as the judicial monitor. His duties would be those which at present are being fulfilled by no one in MI5.
      There is an alternative to the solution which is set out in new clause 3, and I recognise that. The alternative is a reorganisation of the administration within MI5. It would be a managerial solution. Attempts should be made by the management to see that when complaints are made they are heard and investigated, and conclusions are reached which would be for the benefit of the service. I do not for one moment have the least confidence in that alternative being a remedy for the specific difficulties that we are facing at present through the absence of a proper channel for complaint.
      In America, the CIA and the FBI were both troubled—and grievously troubled—by the sort of problems that we in this country have found affecting MI5. In America, they tried to resolve those problems by administrative reform, by bringing in what one might call managerial solutions, and they failed. And what did they do, having failed? They appointed an inspector general within an oversight system of the kind that is proposed by new clause 3. In Canada, people were troubled, as they had been in America and we have been here, by the problem of no proper channel for complaint. They tried to bring in the alternative of a managerial solution. They, too, failed. What did they do? They appointed an inspector general of the kind that is proposed by the new clause, under the title of a complaints commissioner. I am told that in both America and Canada they call him an ombudsman. I do not mind what they call him provided that we have one.
      There were suspicions in the case of Sir Roger Hollis, there was the case of Michael Bettaney and the film of Miss Massiter. If anyone believes that we have seen the last of those troubles, he is deceiving himself. Those troubles and problems are so serious and so fundamentally affect the future security and efficiency of our security services that they must be faced by the Government. I believe that my new clause contains the proper and effective solution. If my right hon. and learned Friend the Home Secretary cannot say that it is the right solution, I hope that he will at least undertake to look again at the problem so that at some later stage we may have the opportunity of reconsidering all these difficulties and bringing them to a proper and satisfactory conclusion.
      Mr. Maclennan: I support new clause 3, spoken to by the hon. and learned Member for Fylde (Sir E. Gardner) with eloquence and cogency. It would be difficult to resist the force of what he said about the present situation and the inadequacies of the routes available to those within the secret service who are concerned, rightly or wrongly, that there has been some fault or activity that they believe is reprehensible, dangerous or wrong.
      The hon. and learned Gentleman made a positive case extremely well. I have tried hard to think what conceivable arguments the Government might try to apply against it. The strongest argument that they could dredge up is that the new clause would be ineffective because it would be difficult for an outsider to have total access to the workings of the machine that would enable an effective examination to take place. In the case of Sir Roger Hollis, it was possible for channels to be blocked, or at least it was alleged that that happened. There is no guarantee that an outsider, given the most far-reaching powers, would be able to unblock such channels or would not be stopped by

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      the battlement deliberately put in the way by someone obstructive in a hierarchy where it is possible to block communications.
      However, that argument of ineffectiveness does not demolish the hon. and learned Gentleman's case. I suspect that the complaints that arise from time to time flow from an incomplete appreciation of the picture by someone in the service who is capable of seeing it only from that corner from which he views those things, a part of the whole. All that is needed is an outside, independent person to say, "I have looked at the situation in the round and I think that what has happened is justified and was done for good reasons." Then many of the problems might disappear.
      I think that the hon. and learned Gentleman has in mind someone of the highest authority and experience and of the utmost probity and reliability to be in such a role. Therefore, there is no possible security argument that could be deployed against the hon. and learned Gentleman's case.
      Sir Edward Gardner: The person who would be eligible for such an appointment by the Prime Minister would, as the new clause says, be someone who holds or has held high public office.
      Mr. Maclennan: I have no doubt that suitable names spring to mind.
      Even if the new clause does not altogether deal with the problem, which has occurred repeatedly—the hon. and learned Gentleman cited the examples of the Bettaney, Hollis and Massiter cases—we must try to do something to improve the situation. It may not be the perfect remedy, but at least it does not carry within it any seeds of the destruction of the service. It is not such a radical proposal that it need cause fluttering in the dovecots of those who have a professional involvement in security matters and to whom "outside intervention" of any sort would certainly seem unusual. It should not necessarily be unwelcome.
      Mr. Douglas Hogg: I should like to speak to amendment No. 88, which is in my name.
      I also support in broad terms new clause 3 argued so persuasively by my hon. and learned Friend the Member for Fylde (Sir E. Gardner) and the point made by the hon. Member for Caithness and Sutherland (Mr. Maclennan).
      However, I do not want to range as widely as my hon. and learned Friend because I should like to confine my attention to the scope of the Bill. We are seeking to determine a good system for investigating complaints about the misuse of the interception of telephones and postal communications. That is the prime purpose of the Bill. The inevitable truth is that those who know most about the abuses are those who are employed either in the public service or by the relevant agencies of the public service. For the most part, they are covered either by the Official Secrets Act or by restrictive covenants in their contracts of employment. Consequently, they cannot go to the commissioner with a complaint without exposing themselves either to prosecution under the Act or perhaps to disciplinary procedure arising from a breach of their contract of employment.
      It is perfectly true that subsection (3) gives unlimited protection, but that protection exists only when the commissioner requires disclosure of information or production of documents. It does not exist when somebody wishes to volunteer either one or the other. It is in the
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      public interest that members of the security services, Crown employees of one kind or another, employees of BT or the Post Office, should be able to go to the commissioner if they have reasonable grounds to suppose that an offence is being committed under clause 1 or that there has been a contravention of clauses 2 to 6, and that they should be able to do this without exposing themselves to legal sanctions.
      There are three things which make this desirable. First, this is a way whereby abuses will be discovered and the existence of the sanction will itself be a further restraint and check on abuses. That is the first advantage.
      Secondly, these are matters that should be brought to the attention of the public. Furthermore, this will act as a safeguard for discontented members of the security services. If they do not have a safe quarter to which they can turn, they will be dissatisfied and discontented.
      9 Pm
      Mr. Golding: I am not sure that it is a matter of bringing it to the attention of the public. The attraction of the amendment for me is that it is taken to somebody who is going to examine it in private. These are not matters, speaking for myself, about which we want public discussion. I have been appalled at the naming of Harry Newton as an MI5 agent without possibility of proof or disproof. We do not want discussion of these matters in public, either because of the individuals involved or because of the security of the realm or wanting to fight crime. What is needed is access to somebody in private who is able to act on one's behalf.
      Mr. Hogg: The rebuke is well taken and the hon. Gentleman is quite right. To use President Reagan's words, I mis-spoke myself. The point I am making is that it is desirable that there should be a body to which discontented members of the security services can turn. It is the fact of disclosure to that body and then an independent and private inquiry that will do so much to reduce discontent within the secret service and elsewhere.
      The third point is that, if there is not this particular safety valve, people will undoubtedly turn to the press and there will be a whole series of scare stories, which would be in nobody's interest.
      Accordingly, I am in favour of some means whereby members of the security service, the Post Office and BT who fear there may have been an offence or a contravention can pass on this information without exposing themselves to legal action.
      Mr. Brittan: The debate covers two separate but related aspects of the Bill. The first is the anxieties initially expressed by the hon. Member for Newcastle-under-Lyme (Mr. Golding) about the position whereby the staff of BT or the Post Office had information which they were afraid to disclose for fear that they would be guilty of an offence under the Official Secrets Act.
      I would not wish those staff to be inhibited in any way by such a concern. The only reason why I cannot advise the Committee to accept this amendment is that I believe that they need not be inhibited by any such concern under the provisions of the Bill together with the general law as it stands. I can certainly assure the Committee that if I were not of that view I would be extremely sympathetic to the belief that it is necessary to do something about it.

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      I have no desire to prevent those with legitimate grounds for making a complaint or anxieties to express through the proper channel from doing so.
      To explain why I think that it is not necessary for there to be any provision other than what stands on the face of the Bill it is necessary once again to make the distinction I made at an earlier stage, in our deliberations on another amendment, between the various institutions and the various things that may go wrong. I will deal first with the aspect that has been the main subject of this part of the debate and the anxiety expressed by the hon. Member for Birmingham, Erdington (Mr. Corbett)—that is, breaches of the law; matters which become offences under clause 1 but which have not been offences until now.
      I am advised that, if a telecommunications or Post Office employee were, like any other member of the public in a similar position, to make a complaint to the police—which would be the proper avenue for dealing with breaches of the law—he would not be in breach of section 2 of the Official Secrets Act.
      I should explain—this relates perhaps to some of the earlier debates rather than to this one—that it is my intention to issue guidelines to the police, as I said on Second Reading, as to how they should discharge the new function of investigating breaches of the law constituted by this newly created offence. The police will have a new task and they might require assistance from outside their own ranks to investigate matters which previously had not been subject to their scrutiny. Someone who makes a complaint to the police about a breach of the law will not be liable to prosecution under the Official Secrets Act.
      We must also consider impropriety, which is within the ambit of the commissioner and the tribunal. I do not want anyone to be inhibited by the fear of prosecution under section 2 of the Official Secrets Act.
      Hon. Members have mentioned clause 8(3), which imposes a duty on all concerned to disclose to the commissioner such documents or information as he may require to enable him to carry out his functions. My hon. Friend the Member for Grantham (Mr. Hogg) made a distinction between information sought by the commissioner and information volunteered by those who believe that their information is relevant to the commissioner's task. It will be for the commissioner to determine how he formulates his requirement for information and documents.
      There is little doubt that those requirements will be expressed — this is the Government's intention — in general terms and be directed to the Ministers or senior persons concerned and so will apply to all subordinate staff. Anyone in possession of information which he thinks is relevant to the commissioner, even if he has not been asked for it, would be authorised to disclose it, and therefore not be guilty of an offence under section 2. If there were any doubt, the person need only tell the commissioner that he is in possession of relevant information or documents and the commissioner will ensure that his requirement is framed, or reframed, in terms which cover those circumstances. It is inconceivable that that would not be done.
      Although I sympathise with the anxieties of hon. Members on both sides, I do not believe that an
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      amendment is necessary because the Bill, with the general law, is couched in terms which will have the desired effect.
      Mr. Golding: The Minister has been helpful and I thank him. However, I am still unclear about why the provision is different for the commissioner and for the tribunal. Have I missed the explanation?
      Mr. Brittan: The tribunal's position is different. The commissioner is concerned with interception in general terms, with the whole operation of the system and perhaps with impropriety in the broader sense. The tribunal is concerned with a narrower question. It must decide whether official interception has taken place — a relatively simple matter—and whether it should have taken place in the sense of the Secretary of State acting reasonably in applying the criteria when he issues the warrant. For those purposes, the information relates to the material presented to the Secretary of State. That material will not emanate from Post Office or telecommunications employees. The tribunal's task therefore differs from the commissioner's task. It is almost impossible to conceive of circumstances in which the particular protection of the tribunal as opposed to that of the commissioner is called for.
      Mr. Golding: The Home Secretary might find it difficult to envisage such circumstances, but what harm is there in the Home Secretary making it absolutely clear that, if such circumstances arose, the same cover would apply to tribunals as applies to commissioners? Because there is doubt in the minds of BT staff, and possibly Post Office staff, what do we have to lose by making it absolutely certain in the Bill that BT and Post Office employees can give evidence to the tribunal, if they wish, without fear of prosecution under the Official Secrets Act? In many ways, it would be simpler if the Home Secretary, who has been so helpful in the matter of the commissioner, at the very least said, "I shall look at this aspect again before Report" rather than shut the door.
      Mr. Brittan: I am grateful to the hon. Gentleman for accepting what I said about complaints about the police. I beg him not to fail to appreciate that, just because the police are not mentioned, they are the most important part of the matter. I am grateful to the hon. Gentleman also for accepting that the coverage effectively deals with the commissioner.
      I do not believe, for the reasons that I have given, that there is a problem in relation to the tribunal, but I shall be happy to consider the hon. Gentleman's points further. As presently advised, it would be wrong for me to give the impression that a further gap needs to be filled. I shall certainly consider the hon. Gentleman's point.
      My hon. and learned Friend the Member for Fylde (Sir E. Gardner) referred to wider matters. They are very much wider matters. The Bill relates to interception, so it is inevitable that my hon. and learned Friend's new clause should refer to complaints about interceptions. Many, if not most, of the complaints mentioned in the various examples given by my hon. and learned Friend either do not primarily relate to interception or do not relate to interception at all. It would be a curious remedy therefore to set up a complaints system that would deal with the problems which have been identified, rightly or wrongly, by my hon. and learned Friend and would confine itself

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      to the interception of communications. It would plainly be impossible for this legislation to do anything other than confine itself to the interception of communications.
      I hope that my hon. and learned Friend the Member for Fylde will not feel that, apart from any other considerations, the necessity of giving so narrow a remit to the commissioner makes it inappropriate for the legislation to contain such a provision.
      Sir Edward Gardner rose—
      Mr. Brittan: I think that I shall be dealing with the broader point to which my hon. and learned Friend intends to refer.
      Sir Edward Gardner: I was going to point out that I was very much aware that some of my examples were merely illustrative of the need for a person to investigate complaints. I hope that my right hon. and learned Friend will hear in mind that the Massiter film dealt with alleged unlawful and wrongful interceptions.
      9.15 pm
      Mr. Brittan: Perhaps my hon. and learned Friend would be good enough to peruse at his leisure my speech on Second Reading. He will find that I dealt seriatim with the various allegations, of which the allegations in relation to interception — which were the subject of Lord Bridge's report—were only a part. Therefore, the very example that my hon. and learned Friend gives appears to illustrate that this would be an ineffective remedy even if a remedy of this kind were appropriate for the security services.
      I thought that my hon. and learned Friend was going to chide me with not dealing with the broader considerations that he raised. However, he was charitable enough to anticipate that I might go on to do so. Of course, I share and understand his concern and that of other hon. Members about the necessity for those in the security services to be able adequately to discharge their feelings of resentment, discontent, inadequacy as to their seniors' conduct or even a feeling that something more serious had gone wrong. It is important that there should be a proper way in which they can do so. However, there is a risk that, because there have been one or two cases such as those mentioned, wrong conclusions may be reached.
      I do not accept that it necessarily follows that a person who has subsequently gone very seriously wrong would not have done so if there had been a person on whose shoulders he could lean. It is very easy, for charitable or other reasons, to make such assertions. Even if we were inclined to go down that path, we would be reluctant to impose so great a degree of confidence in an institution as to assume that it could avert a person in that frame of mind from committing offences. There is a risk that topical examples lead us to reach the wrong conclusions.
      The experience of a disciplined service in which those who feel that something has gone wrong need a vehicle for expressing their discontent is not unique to the security services. Indeed, it is not unique to them for the position to be such that disclosure of information by disaffected persons would be damaging to the country. An obvious example is the armed forces of the Crown, where many people in both the lower and more senior positions are properly and necessarily equipped with material information of a highly secret nature.
      I do not think that it would be suggested that we should have an ombudsman in that area of activity. It is
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      appropriate to consider in the Civil Service as a whole what the proper channel of complaint should be. Most people who have been involved in these matters, whether in the Civil Service, armed forces or the security services, would feel that it is a proper function of senior management to organise itself so that there is a machinery whereby persons lower down can ventilate complaints with confidence that they will be properly investigated.
      It is necessary that that should happen in any organisation — the so-called managerial solution, on which my hon. and learned Friend looked with an unnecessarily critical gaze—but we are talking not only about a large organisation but one where there is ministerial responsibility and oversight. I said on Second Reading that I regarded the discharge of that responsibility as one of my most important tasks; that I wished to make certain in my mind that the director-general and his senior colleagues so organised the security service that it was possible, and active encouragement was given, for complaints to be made.
      I have discussed that matter with the new director-general and I propose to continue discussing it so as to satisfy myself that, within the security service, the problem is adequately understood and properly dealt with. That is the right approach. It is reasonable to have a system in which one is alert to the problem but in which the responsibility for dealing with it is put on the professional head of the service, under the superintendence of the Minister to whom he is responsible.
      That is the proper approach to these matters and we should not be diverted from it because of an example, or even a couple of examples, where it is asserted, but cannot be proved, that the alternative approach commended in the amendment would have prevented serious matters that did occur.
      I assure hon. Members, from the point of view of the director-general and myself, that I regard the provision of proper machinery in the security service for the ventilation of complaints of all kinds as a matter of great importance. The Committee owes a debt of gratitude to my hon. and learned Friend for giving us the opportunity to make the position on that absolutely clear.
      Mr. Golding: It must be a sign of the times that the Home Secretary is far more critical of amendments standing in the names of his hon. Friends than he is of anything that we on these Benches say. I thank him for his positive approach to the problems that the members of my union face. I say that with the proviso that we shad almost certainly table a new clause on Report.
      Mr. Brittan: The hon. Gentleman must not add to what I said. I expressed sympathy, but I gave no undertaking.
      Mr. Golding: I am mystified. I simply thanked the right hon. and learned Gentleman for his positive approach. I shall read with wonderment the Official Report of what I must have said that has caused him so much concern. I am glad that the right hon. and learned Gentleman rose, because I am encouraged to examine every dot and comma of his reply. In other words, I shall examine far more carefully than I might otherwise have done the position that he adopted.
      Until the Home Secretary rose to interrupt me, I was positively grateful to him for what he said about the

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      commissioner and about access to the police. In view of his intervention, I am not sure whether he is withdrawing some of what he said earlier.
      Mr. Norris: Get on with it.
      Mr. Golding: Any Conservative Member who tells me at 9.25 in the evening to "Get on with it" cannot have had as much experience of my speeches as, for example, the Government Whip. We are debating a matter that is most important to me. It will not be dealt with by Conservative Members, who come in out of the cold late in the debate and make comments from a sedentary position.
      We are not satisfied with the position regarding the tribunals, and we shall certainly table a new clause for consideration on Report. I am not sure whether the Government should not give protection to British Telecom and Post Office employees in respect of information which tribunals may request from them. If the Government are saying that they cannot envisage tribunals asking for evidence, they should make it clear in the Bill that tribunals do not have the right to ask for information. It is wrong for the Government to create a position which will give tribunals the power to ask BT and Post Office personnel to give information relating to their duties which is covered by the Official Secrets Act without at the same time making it absolutely clear in the Bill that there will be no breach of the Act if the employees respond to that request. The Home Secretary cannot have it both ways.
      Mr. Brittan: The hon. Gentleman is doing both himself and me less than justice. I said that I would consider his point carefully. If he wishes me to do so, I shall do so. However, if he misrepresents what I said, it makes it difficult to do so in the same spirit.
      Mr. Golding: I should have thought that the Home Secretary would consider my point despite what I say. I should have thought that, acting in a judicial manner, he would not say to me, "If you are hard on me, I shall consider the matter differently from the way that I would consider it if you said nice things to me." The Home Secretary must consider the matter carefully.
      I put two separate points to the right hon. and learned Gentleman. Under the Bill, will the tribunal have power to ask BT and Post Office staff about matters relating to their official duties? If the answer is yes, he must give protection to those employees. If the answer is no, he must make it absolutely clear to the tribunal that it cannot ask them about such matters. It must be one way or the other. That is my point.
      I beg to ask leave to withdraw the amendment, although I am not satisfied—
      The Second Deputy Chairman (Sir Paul Dean): Order. Before the hon. Gentleman does that, another hon. Member wishes to make a contribution.
      9.30 pm
      Sir Edward Gardner: I am bound to say to my right hon. and learned Friend that my faith in the efficacy of the proposal in new clause 3 has in no way been undermined by anything that he has proposed by way of an alternative managerial solution. I am anxious, as I hope every member of the Committee is, to give the idea contained in new clause 3 the opportunity of living on and, I hope, a more successful day.
      The Second Deputy Chairman: Does the hon. Member for Newcastle-under-Lyme (Mr. Golding) wish to withdraw his amendment?
      Mr. Golding: I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Mr. Douglas Hogg: I beg to move amendment No. 142, in page 7, line 31, leave out 'Subject to subsection (8) below'.
      The Second Deputy Chairman: With this it will be convenient to discuss amendment No. 143, in page 7, line 33, at end insert
      'together with a statement as to whether any matter has been excluded from that copy in pursuance of subsection (8) below.'.
      Mr. Hogg: This is part of the process which provides greater safeguards for the citizens. Under clause 8(4) the procedure is for the tribunal to report to the commissioner. The commissioner investigates and considers and then, in time, reports to the Prime Minister. The Prime Minister is under a duty to provide a copy of the annual report made by the commissioner, but it is clear and necessary that the Prime Minister should have the power to delete material which is prejudicial to the national security. It seems to me, and I hope that it will seem so to my hon. and learned Friend, that if that power is exercised, the fact that that material has been excluded should be contained in the report. It is additional information which I feel the House should have.
      Mr. Waddington: The Government welcome the approach adopted in these amendments and will be glad to see them incorporated in the Bill. The commissioner's report must meet two requirements. It must be frank, and the commissioner must not in any way be inhibited in what he thinks is appropriate formally to draw to the Prime Minister's attention. He therefore may wish to comment on matters of the greatest secrecy. It is therefore also necessary that before the report is published such passages should be deleted. If that were not possible, the report could not serve the purpose which it is intended to serve.
      The Government like these amendments because they, as it were, round off that arrangement. They ensure that the Prime Minister makes a statement if any changes have been made, so that Parliament is informed of the fact of deletions, but is not, of course, given any indication as to their content. These are welcome additions to the Bill. I am grateful to my hon. Friend for moving the amendment.
      Amendment agreed to.
      Amendment made: No. 143, in page 7, line 33, at end insert—
      `together with a statement as to whether any matter has been excluded from that copy in pursuance of subsection (8) below.'. —[Mr. Douglas Hogg.]
      Clause 8, as amended, ordered to stand part of the Bill.

    Clause 9

      EXCLUSION OF EVIDENCE
      Mr. Douglas Hogg: I beg to move amendment No. 109, in page 8, line 2, after 'shall', insert
      `except as authorised by a direction given in pursuance of subsection (1A) below'.
      The Chairman of Ways and Means (Mr. Harold Walker): With this it will be convenient to consider amendment No. 110, in page 8, line 8, after 'persons', insert—
      '(1A) a direction as mentioned in subsection (1) above may be given by a court or tribunal if that court or tribunal is satisfied whether on application or otherwise that a failure to give such a direction would seriously prejudice the rights of one or more of the parties to the proceedings there before it.
      In the event of such a direction being given no matter given as evidence pursuant to that direction shall be published in any written publication available to the public or to broadcast except as authorised by direction made under subsection (1B) below.
      (1B) If the court or tribunal which makes such a direction as is mentioned in subsection (1B) above is satisfied that the effect of subsection (1B) is to impose a substantial and unreasonable restriction upon the reporting of the proceedings and that it is in the public interest to remove or relax the restriction it may direct that that subsection shall not apply to such matter as is specified in the direction.
      (1C) If any matter is published or broadcast in contravention of subsection (1A) of this section, the following persons, namely—

      (a) in the case of a publication in a newspaper or periodical, any proprietor, any editor and any publisher of the newspaper or periodical;

      (b) in the case of any other publication, the person who publishes it; and

      (c) in the case of a broadcast, any body corporate which transmits or provides the programme in which the broadcast is made and any person having functions in relation to the programme corresponding to those of an editor of a newspaper,

      shall be guilty of an offence and liable on

      (i) summary conviction to imprisonment for a term not exceeding 6 months or to a fine not exceeding the statutory maximum or both;

      (ii) on conviction on indictment to imprisonment for a term not exceeding 7 years or to a fine or both.

      (ID) In this section—
      "a broadcast" means a broadcast by wireless telegraphy of sound or visual images intended for general reception, and cognate expressions shall be construed accordingly;
      "written publication" includes a film, a sound track and any other record in permanent form but does not include an indictment or other document prepared for use in particular legal proceedings.'.
      Mr. Hogg: I take the view that these are important amendments. As I understand it, the effect of clause 9 as it stands is that in no legal proceedings other than those mentioned in clause 9(4) may evidence be adduced to the effect that an offence has been committed under clause 1 or that the warrant is in existence. That is a broad power. It is a statutory prohibition on the admission of evidence in court.
      The first question that I must ask my hon. and learned Friend is whether at the moment there is any statutory bar on the admission of evidence relating to the issue of warrants or the identity of persons to whom the warrant has been issued. So far as I am aware, there is no such statutory bar. I feel sure that the Committee would appreciate my hon. and learned Friend's guidance. There is of course always the residual power of the judge to exclude, but I am not aware of the exclusion being used in circumstances such as these.
      If I am right in thinking that there is at present no statutory bar, the Government are going beyond what was said in paragraph 7 of the White Paper, which stated that it was not the purpose of the Bill to extend the law beyond the existing custom and practice. If we introduce an exclusion rule which does not exist at present, we shall indeed go beyond present custom and practice.
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      The purpose of the amendment is to admit evidence of the kind to which I have referred but which is now excluded in certain circumstances. There muse be, and there is, a general presumption in favour of the admission of relevant evidence. I do not mean a legal presumption —there is in fact a legal rule—but every member of the Committee will accept that as a general rule relevant evidence should be admitted to courts. Sometimes it is necessary to impose restraints on the publication of matters before a court. Sometimes that is justified. However, as a general rule, I am in favour of relevant evidence being admitted before a court.
      One must recognise that the exclusion of relevant evidence can often cause real prejudice. That is a general proposition. May I test it by example? If I suggest an example, my hon. and learned Friend can always say that the example is a fanciful one, that such a case would be unlikely to arise, or that such evidence would perhaps be admitted or would not be relevant. However, I would like to test the proposition by considering two or three examples.
      First, let us take the example of a libel case. A newspaper alleges of a Minister or a specific official that he has acted in a repressive, unreasonable or dictatorial way. That would seem to be a defamatory observation to make of any Minister or official. The Minister or official sues the newspaper for libel. The newspaper has in its possession evidence to show that the Minister or official had connived at, instigated or otherwise been a party to an unlawful interception or an interception which contravened clause 2 and the consequential clauses. Is it to be said that, in libel proceedings, a newspaper is not able to adduce evidence to show that an offence has indeed been committed under clause 1, or alternatively that the Minister or official has connived at a breach of, for example, clause 2? That is an extraordinary proposition. It does not seem right at all. That is one example of a case in which the interests of justice and of the parties involved require the admission of that class of evidence.
      Let us take another example. An employee of British Telecom unlawfully intercepts a telephonic communication. That employee is of course committing art offence under clause 1. He is therefore dismissed. He then goes to the industrial tribunal and claims that he has been dismissed unfairly. However, the reason why he was dismissed is that he had been interfering with telephonic communications, which is an offence under clause 1. Is his employer to be prevented by the Bill from adducing evidence to that effect or cross-examining on that matter?
      For a third example, let us take the case of a Post Office worker. Quite frequently—I mean no disrespect to the hon. Member for Newcastle-under-Lyme (Mr. Golding) — members of the postal service interfere unlawfully with the mail, for a variety of reasons. That happens in a significant number of cases every year, and could be an offence under clause 1. The Post Office dismisses that employee, and the employee goes to the industrial tribunal alleging unfair dismissal. The reason for his dismissal was an offence under clause 1. Is the Post Office to be prevented from adducing evidence, or cross-examining, to the effect that there has been an offence under clause 1? The answer must be no. Nevertheless, all of the cases that I have outlined are covered by the Bill in its present form and would prevent justice from being done. That is why it is a serious matter.

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      I am aware that deeply sensitive issues must be involved in the material that might be put before courts. I have therefore put down the presumption that such evidence will not be admitted. That is the starting point. I have then incorporated the proviso that such evidence may be admitted if refusal to admit it
      "would seriously prejudice the rights of one or more of the parties to the proceedings".
      We therefore start from the presumption—which my hon. and learned Friend the Minister would favour—that the evidence is inadmissible, and say that it must be admitted if the judge or tribunal gives a direction in the interests of justice. Even then I am prepared to accept my hon. and learned Friend's anxiety, because I have provided that the material should not be published unless the tribunal or judge thinks that it is in the national interest to do so.
      I regard this as a modest means of dealing with the problem. A bar is likely to cause grave injustice, and I am anxious about its appearance in a statute presented by my hon. and learned Friend.
      Mr. Waddington: I am grateful to my hon. Friend for raising interesting issues. There is no statutory bar on evidence being adduced on the existence of warrants, so there is no bar on questions being asked.
      My hon. Friend said that the Government are now trying to do what they said in the White Paper they were not trying to do. With respect to my hon. Friend, he is wrong. He is obviously reading paragraph 7 of the White Paper which says that the Government are not seeking, through the introduction of the Bill, to broaden the scope of existing practices in the interception of communications. Paragraph 7 could not be read as referring to questions about the law such as my hon. Friend asked.
      My hon. Friend's amendments are based on the assumption that the problem is that the courts will not be able to reveal publicly that in which there is a public interest. That is not the problem or, if it is, it pales into insignificance as compared with the real one, which is how we can afford to finish up with a system in which a rogue is enabled to discover the evidence which is available against him. We have to have a system under which a person does not learn, by bringing proceedings, what evidence there is against him. It would be absurd if, having constructed a tribunal to hear complaints, but under a special procedure which does not allow the complainant to know the evidence available against him, the complainant was able to go to a court of law and bring proceedings for the sole purpose of discovering that which he had no hope of discovering from the tribunal.
      The Committee has already considered the tribunal for which special procedures are set out in schedule 1 which prevent the tribunal from revealing to one party information that it has received from another. This is absolutely vital, otherwise a person would be able to take an application to the tribunal and thereby discover whether a warrant was in existence in his name. The whole system would collapse.
      9.45 pm
      Precisely the same point arises over court proceedings. The circumstances are different but the principle is the same. Somebody should not be able to discover whether a warrant is to be directed against him just by mounting
      1304
      proceedings. These amendments do not mean that in any such proceedings evidence about interception would necessarily be presented. However, they are based on two assumptions: first, that it is known that there is such evidence to give, which in itself is unacceptable; secondly, that both parties might be involved in any consideration of whether or not a direction should be given, and, if it were, would be privy to what was presented as a result.
      It does not take a great deal of imagination to conceive of circumstances in which an ingenious litigant would discover grounds with which he might expect to persuade the court that it was in his interests that evidence which he believed to be in the hands of the authorities and which he believed to be the result of interception was essential to secure his rights. Merely to start down this road means that the existence of a warrant may have to be confirmed or denied. This in itself would go too far and would prejudice the very confidentiality upon which the effectiveness of authorised interceptions so crucially depends.
      My hon. Friend the Member for Grantham (Mr. Hogg) referred to the possibility of a Minister conniving at unlawful tapping and of a newspaper having evidence of it, with the Minister suing the newspaper and the newspaper therefore being put at a disadvantage. As I understand it, in those circumstances there would be no difficulty whatsoever because the Minister would have committed a crime under clause 1. My hon. Friend will see that, according to clause 9(3), subsection (1) does not apply to a relevant offence, and "relevant offence" means, among other things,
      "an offence under Section 1"
      as provided in subsection (4)(a).
      Mr. Douglas Hogg: My hon. and learned Friend does me an injustice, because I thought of that one as well. If he cares to look at subsection (3) he will see that
      "Subsection (1) does not apply in relation to proceedings for a relevant offence."
      A libel case does not constitute proceedings for a relevant offence within the meaning of the clause.
      Mr. Waddington: I do not really follow what my hon. Friend is saying. I am referring to clause 9(4) which contains a definition of "relevant offence".
      Mr. Hogg: With respect to my hon. and learned Friend, that is perfectly true, but subsection (4) is dependent upon subsection (3).
      Mr. Waddington: I shall look into that point when I have a little more time, but my advice is that if a Minister were guilty of a crime because an offence had been committed under subsection (1), the first part of clause 9(1) would not come into play. However, I shall take advice on that point and will write to my hon. Friend if he is correct in assuming that the explanation I have given is incorrect. One has to address one's mind to the main problem: that if one sets up a tribunal which prevents a man from finding out whether he has been properly intercepted, one cannot finish up with that man being able, by bringing proceedings in court, to obtain the information which he failed to obtain from the tribunal. One has to face up to that difficulty.
      Mr. Hogg: I wish to make three brief points. First, my hon. and learned Friend the Minister must accept that he

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      is extending the scope of the law in that there is at present no statutory bar to exclude such evidence and in future there will be such a bar.
      Secondly, my hon. and learned Friend did not deal with the points that I made about unfair dismissal, and it is clear that in the two cases that I mentioned the employer would be at a substantial disadvantage as a result of the Bill.
      Thirdly, we must accept that if the Bill is enacted in its present form injustice will be done to parties. As a general proposition, I am prepared to accept that the evidence should not be introduced, but I want a residual power to introduce it in some circumstances.
      Having said that, I recognise that I am not about to persuade my hon. and learned Friend—
      Mr. Maclennan: Will the hon. Gentleman allow others to comment before he seeks leave to withdraw the amendment?
      Mr. Hogg: I am happy to oblige the hon. Gentleman.
      Mr. Maclennan: The hon. Member for Grantham (Mr. Hogg) has done the House a great service by raising this issue, which has given rise to considerable anxiety. The whole of clause 9, with which the amendment seeks to deal, has been commented on most adversely by Justice, the British branch of the International Commission of Jurists, as being oppressive and going beyond what is necessary to confine the judicial remedy to the tribunal.
      Clause 9 takes away a right which was previously enjoyed and does not need to be removed for the Minister to achieve his aim. I understand the argument that it is undesirable and, indeed, impossible to set up a tribunal and to allow a remedy through the High Court to proceed in parallel, but that is not the point to which the main thrust of clause 9 relates. In fact, it will preclude the possibility of a line of examination or cross-examination being pursued which may arise in the course of some quite different matter.
      The circumstances of the Malone case spring to mind in this regard. If these provisions go through in their present form the circumstances of a case of that kind may never come to light again. I do not think that the hon. Gentleman has sufficient troops here to force a Division on the matter, but I sincerely hope that the issue that the hon. Member for Grantham has very properly raised will receive very careful consideration by the legal luminaries in another place.
      Mr. Waddington: Perhaps I may reply to the last point. The hon. Gentleman suggests that if the new procedure had been in existence the Malone case would never have come to light. But once the Bill becomes law there need never be such a case again because a person such as Mr. Malone will have a remedy. He will be able to go to the tribunal.
      Mr. Maclennan: With respect, the Minister misses the point. Mr. Malone would never have known that his telephone had been tapped if it had not been revealed in the course of examination of a policeman's notebook that something had been going on, leading Mr. Malone and his counsel to suspect that interception had taken place. We are men of the world. We appreciate how difficult it is to identify whether telephone tapping or any other form of interception has taken place and that it is only in circumstances of that kind that it will ever come to light.
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      In reality, although in theory Mr. Malone might have a remedy, he would never know that he needed to exercise it.
      Mr. Waddington: Surely this is nonsense. If Malone or his advisers had suspicions that his telephone was being tapped, in the old days one would look through a policeman's notebook to ascertain whether there was some evidence of it there. Under the new regime, he would he able to go to the tribunal.
      Mr. Maclennan: With respect to the Minister, they did not have any knowledge or suspicion that this was taking place. It was only because the matter came out in cross-examination that it was followed up at all. I think that the Minister will find that this matter arouses anxiety in another place, and I have no doubt that it will have to be pursued.
      Amendment negatived.
      Clause 9 ordered to stand part of the Bill.

    Clause 10

      INTERPRETATION
      Amendment made: No. 118, in page 9, line 37, at end insert—
      '(3) For the purposes of this Act conduct which constitutes or, if it took place in the United Kingdom, would constitute one or more offences shall be regarded as serious crime if, and only if—

      (a) it involves the use of violence, results in substantial financial gain or is conduct by a large number of persons in pursuit of a common purpose; or

      (b) the offence or one of the offences is an offence for which a person who has attained the age of twenty-one and has no previous convictions could reasonably be expected to be sentenced to imprisonment for a term of three years or more.'.— [Mr. Waddington.]

      Clause 10, as amended, ordered to stand part of the Bill.
      Clauses 11 and 12 ordered to stand part of the Bill.

    New Clause 5

      OFFENCE OF DISCLOSURE
      'A person who intentionally discloses a communication intercepted in the course of its transmission by post or by means of a public telecommunications system shall be guilty of an offence unless such disclosure is made—

      (a) with the consent of the individual to or by whom the communication is sent;

      (b) for the purposes connected with the maintenance or provision of postal or public telecommunications services;

      (c) for the purposes in respect of which the Secretary of State has issued a warrant under section 2 below;

      (d) to the Tribunal or to the Commissioner or to the Select Committee;

      (e) in proceedings in respect of an offence under this Act;

      (f) in the public interest to disclose evidence that a grave offence had been committed.'.—[Mr. Mc William.]

      Brought up, and read the First time.
      Mr. McWilliam: I beg to move, That the clause be read a Second time.
      I do not wish to detain the Committee for long. I have no doubt that the Minister will pray in aid schedule 2. Several problems arise here. It seems to us that disclosure is a far more heinous crime than interception. Many people have to intercept communications in the course of their duties. If they disclose something to another person that is a different matter. Indeed, during the debates on what

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      are now the Telecommunications Act 1984 and the British Telecommunications Act 1981, this was a preoccupation of hon. Members. Given that disclosure is the real crime—and I submit that the real crime is that someone who has gained information from interception discloses it to a third party — the Bill as drafted seems to us to be inadequate, which has led to the tabling of new clause 5.
      The proposed new section 45(2) to the 1984 Act, as set out in schedule 2, says that control should be lifted from people who make
      "any disclosure which is made for the prevention or detection of crime or for the purposes of any criminal proceedings".
      Any detection which is made under warrant is also covered by the Bill. The only assumption that can be made is that this must be a let-out for disclosures other than those that are made under the proposed subsection (1). Indeed, it is made clear in subsections (2)(a)and (c) that the same kind of let-out exists in terms of national security.
      It is not part of the Opposition's case that we shall make life easier for criminals or for those who would jeopardise national security. However, we are concerned that the Bill should not contain a catch-all provision. Therefore, we have tabled new clause 5, which is perfectly straightforward. It imports the principle of schedule 2 to the main body of the Bill, but does not import the let-out that has been built into schedule 2. Therefore, I commend it to the House.
      Mr. Norris: I should like to draw the hon. Gentleman's attention to paragraph (f) of his new clause because I, too, proposed a new clause—new clause 6—which was not selected, but which was virtually identical to his—
      It being Ten o'clock, THE CHAIRMAN left the Chair to report Progress and ask leave to sit again.
      Committee report Progress.
      Ordered,
      That, at this day's sitting, the Interception of Communications Bill may be proceeded with, though opposed, until any hour—[Mr. Archie Hamilton.]
      Bill again considered in Committee.
      Question again proposed, That the clause be read a Second time.
      Mr. Norris: I should like to ask the hon. Gentleman this question. I believe that it is important enough to ask if only because many of the amendments that have been withdrawn during the Committee stage will be debated at length in another place. Does the hon. Gentleman not think that by adding the words "to disclose evidence" and thereafter in paragraph (f), in other words, by trying to define what is meant by the public interest, he vitiates the purpose of adding that important paragraph?
      Subsection (2)(a), as set out in schedule 2, covers the point that the hon. Gentleman is making. It states that any person who makes such a disclosure
      "for the prevention or detection of crime"
      would be exempt from the provisions of schedule 2. I have sought to make the point that the most important areas of public interest are where a crime may not have been committed but where, none the less, it is in the genuine public interest that matters be disclosed. Will the hon. Gentleman address himself to that point?
      Mr. McWilliam: I am grateful for that intervention. We are trying to clarify the law as it is proposed. New clause 5 with paragraph (f) in it would entirely meet the
      1308
      point raised by the hon. Gentleman. It is an important point, and we must all bear it in mind. The difficulty is that the proposed subsection (2)(a) is too broad, whereas paragraph (f) of new clause 5 is narrow enough to impose a reasonable constraint upon the Executive, but broad enough to meet the hon. Gentleman's point. That was the intention behind drafting the new clause in this way. When we did so, we were minded of the new clause which the hon. Gentleman had tabled. It is not our intention to be partisan about this matter. We are trying to protect the people and at the same time allow the security services the access to information which they need. That is the entire import of new clause 5 — to prevent the sweeping suggestion in schedule 2 and to import the main point into the body of the Bill.
      Mr. Waddington: The Government accept that it is essential to secure proper protection of material intercepted by warrant. That is what clause 6 is all about. The improper disclosure of intercepted material is already covered by various statutory provisions. The first is, of course, section 2 of the Official Secrets Act. It covers improper disclosure by those in the Crown service, which includes the police, and it is also expressly applied to the staff of the Post Office through the Post Office Act 1969 and to the operators of public telecommunications systems through the Telecommunications Act 1984. Its application is therefore comprehensive over possible possession of intercepted material.
      The telecommunications side is additionally covered by section 45 of the Telecommunications Act 1984, which, as the hon. Member for Blaydon (Mr. McWilliam) said, is amended by schedule 2. The hon. Gentleman complains about the wording of subsection (2) of that section. I suggest that his criticism is misconceived. Subsection (2)(a) follows the scheme of the Data Protection Act, under which, as the hon. Gentleman knows, a person may disclose matters to the police even though the police do not appear in his registration particularly as somebody to whom he may disclose data. Therefore, I suggest that it is entirely proper that a similar scheme should be found in this Bill.
      Mr. McWilliam: I intervene merely to point out that we opposed that section because we did not think it was sufficiently tightly drawn. Therefore, it is entirely consistent with the argument that we are now putting that this provision is not sufficiently tightly drawn.
      Mr. Waddington: The hon. Gentleman is clearly entitled to make that point, but it is not going to get us very far tonight because we, obviously, were satisfied with the Data Protection Act or we would not have presented it to the House. We shall have to agree to disagree on that.
      Given the fact that the Data Protection Act is now on the statute book the hon. Gentleman must not be surprised to find that in this Bill we have followed exactly the same scheme for the disclosure of information.
      On the postal side the provisions are rather older, being contained in telegraph legislation of the last century, the provisions in question making it an offence for a post office official to disclose the contents of any message entrusted to the Post Office for the purpose of transmission to any person.
      In addition to these offences, there are two other considerations to be borne in mind. First, the arrangements which must be established under clause 6 and which the

      1309
      commissioner keeps under continuing review deal comprehensively with the safeguarding of intercepted material. Thus, at a stage short of the involvement of the criminal law there are arrangements to ensure that the material is properly looked after. The Secretary of State is obliged by clause 6 to address his mind to these arrangements when he issues warrants.
      Secondly, as a matter of practice in the Crown service as well as in the Post Office and for public telecommunications operators there are codes of conduct covering a wide range of things, including the proper handling of material obtained during the course of people's duties. Breach of these codes can in appropriate circumstances lead to dismissal.
      Therefore, there are a number of pieces of legislation which bear on these matters, there is the new protection provided in schedule 2 and there is the scheme in clause 6 of the Bill. These, taken together, I would submit, meet any mischief such as that suggested by the hon. Gentleman.
      Mr. McWilliam: I would not wish to delay the Committee by pushing this clause to a Division. I cannot say that I am entirely satisfied with the Minister's reply. It may well be that we shall seek to return to the matter at a later stage. At this stage, however, I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.

    Schedule 1

      THE TRIBUNAL
      Mr. Dubs: I beg to move amendment No. 121, in page 11, leave out lines 4 to 6.
      The First Deputy Chairman of Ways and Means (Mr. Ernest Armstrong): With this it will be convenient to take the following amendments: No. 122, in page 11, line 4, leave out from 'members' to end of line 6.
      No. 123, in page 11, line 4, leave out 'each' and insert 'one of whom holds or has held a high judicial office and two others'.
      Mr. Dubs: There is a principle in life in Britain: when in doubt about starting any particular set-up, one brings on the lawyers. I am not particularly attacking lawyers. All that I am seeking to do in amendments Nos. 121 and 122 is to end the monopoly of lawyers—in other words, to end the requirement that only people with a legal qualification can be members of the tribunal. That would not stop Ministers appointing lawyers, but they would not be obliged to do so.
      Amendment No. 121 gives the Minister discretion to appoint more or less than five members of the tribunal. The amendments are simple and I hope that the Minister is sympathetic to them.
      Mr. Maclennan: Amendment No. 123 is in part motivated by the considerations which led the hon. Member for Battersea (Mr. Dubs) to move his amendment. It recognises that the Government think that the tribunal should have a quasi-judicial role, that it should therefore be presided over by a judge, and that a majority of tribunal members should have a legal background.
      Other experience and expertise, in addition to legal expertise, might be of value to the tribunal. Technical expertise such as that offered by hon. Members who have participated in the debate might be useful. A tribunal
      1310
      consisting solely of people with legal expertise might he a little confining. I hope that the Minister agrees that greater flexibility is required.
      Mr. Waddington: Only yesterday we decided through a Government amendment that the tribunal would act as the High Court would act on hearing an application for a judicial review. The tribunal will have a quasi-judicial role and it is therefore appropriate that lawyers should discharge its functions. I say that not because lawyers alone are able to reach balanced judgments, but because legal training is particularly desirable for members of the tribunal.
      We do not say that only legal qualifications are needed. The tribunal must comprise people with wide experience and proven maturity of judgment. We stick to the view that tribunal members should be lawyers but that they should not just be lawyers. The Government intend the tribunal to include in its membership people with a wide experience of affairs. That should give some comfort to hon. Members. We do not think it necessary that the tribunal should include someone who has held high judicial office. I hope that the amendment will be withdrawn.
      Mr. Dubs: I am not convinced, but I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Schedule I agreed to.

    Schedule 2

      SECTION SUBSTITUTED FOR SECTION 45 OF 1984 ACT
      Mr. Maclennan: I beg to move amendment No. 126, in page 13, leave out lines 6 to 8.
      Without my amendment, the schedule could drive a coach and horses through the Bill. It would permit the official telephone tapper to reveal the content of any intercepted conversation to prevent or detect crime, however minor, and to give evidence at any trial of that content.
      The schedule is not restricted to simple metering—that is, information about the destination and duration of calls. The amendment would ensure that the use made of any intercepted material has to be covered by the Bill so that all the safeguards apply.
      If an intercepted message is disclosed in a manner not authorised by clause 1, an offence would be committed. The amendment takes out matters which should be covered by warrant in sub-paragraph (b) and permits information about metering to be disclosed on the order of a court.
      However, the contents of intercepted conversations can be dealt with only under clause 9. I hope that the Minister will undertake to give some thought to my points.
      10.15 pm
      Mr. Waddington: The key point is that there is a fundamental difference between the disclosure of the contents of a communication and the disclosure of so-called metering information. That is why metering is dealt with separately from interception. Intercepted material does not, in the natural course of events, come into the hands of the person intercepting, but metering information is information that is properly held by a telecommunications operator in the course of running his business Meter

      1311
      check printers, which record metering information, are used in a wide variety of cirumstances, principally when there is a query about a person's bill.
      There is no doubt that the disclosure of metering information other than for the purposes of operating the telephone system gives rise to sensitive issues and that there should be a clear statutory basis for such disclosure which sets out the grounds on which it is permissible. The Bill as drafted does this. Nor is there any doubt that access to such information can be of great assistance in the prevention and detection of crime, or in the interests of national security.
      It is important to realise that nothing in these provisions requires a telecommunications operator to disclose metering information. Such operators are simply permitted to do so in circumstances which are defined in a way that closely follows the precedent of the Data Protection Act 1984. The comparison between the disclosure of personal data under that Act and the disclosure of metering information is much closer than the comparison between interception and metering.
      British Telecom already has procedures in which disclosures of metering information for the investigation of serious crime must be approved at a senior level in its headquarters. To ensure compliance with the requirements of section 45 of the Telecommunications Act as amended by schedule 2, I have no doubt that BT and other public telecommunications operators will adopt appropriate procedures to ensure that metering information is disclosed only in appropriate circumstances. The Government believe that the procedures in schedule 2 are appropriate in all the circumstances and that this amendment should, therefore, be rejected.
      Mr. Maclennan: I am grateful to the Minister for that explanation, which I shall study carefully before deciding whether to return to the matter. In the circumstances, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Schedule 2 agreed to.
      Bill reported, with amendments; as amended to be considered tomorrow, and to be printed. [Bill 123.]

  Road Traffic (Northern Ireland)
  10.18 pm
  The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Chris Patten): I beg to move,
  That the draft Road Traffic (Type Approval) (Northern Ireland) Order 1985, which was laid before this House on 18th February, be approved.
  The order provides for the introduction of national type approval arrangements for motor vehicles in Northern Ireland by extending the powers of the Department of the Environment under the Road Traffic Order (Northern Ireland) 1981. The arrangements envisaged would be broadly similar to those that have been in force in Great Britain since 1978.
  The provisions have been urged on the Government by a number of hon. Members, including the right hon. Members for Lagan Valley (Mr. Molyneaux) and for South Down (Mr. Powell). The hon. Member for Belfast, East (Mr. Robinson) has given this subject his usual scholarly attention. I am sorry we have not been able to bring the order forward before.
  Type approval is the process under which a vehicle or vehicle part is submitted, usually by a manufacturer, for testing against objective standards of design, construction and environmental protection. Once that vehicle or vehicle part has been approved as meeting the standard or standards in question, individual vehicles or vehicle parts produced in conformity with the approved type can be certified as meeting the standard without further testing.
  The order will enable regulations to be made listing the standards with which vehicles must comply before they can first be licensed in Northern Ireland. The intention would be initially to make regulations apply only to cars and certain dual-purpose vehicles. For the time being they would not extend to goods vehicles. In their scope, the regulations would cover all the requirements in the construction and use regulations and lighting regulations. They would be precisely the same as those in Great Britain, which are largely based on standards set in EEC directives or regulations issued by the Economic Commission for Europe—a United Nations body.
  Hon. Members may ask why type approval is considered necessary if motor vehicle standards are already laid down in the construction and use regulations and lighting regulations. The main point is that there is no means of checking that vehicles comply with the requirements of those regulations. Therefore it is possible to license a vehicle that is not in compliance with the regulations.
  While the vast majority of new vehicles in Northern Ireland were supplied either from manufacturing plants or import concessionaires in Great Britain, where national type approval is already operated, this distinction was not important. However, with the growth from 1982 of imports direct from the Republic of Ireland and continental Europe—a point to which right hon. and hon. Members have drawn our attention since 1982 — there was less assurance that imported cars complied with the requirements.
  Purchasers of non-complying vehicles therefore face the possibility of prosecution for infringement of the construction and use regulations. This type approval order will help overcome that problem by enabling other type

  1313
  approval arrangements to be introduced. The draft order therefore represents a consumer protection as well as a road safety measure.
  The draft order closely follows corresponding legislation in Great Britain. Indeed, it is very closely modelled on the Road Traffic Act 1972 and the amending Act of 1974. In essence it provides for the establishment of type approval requirements by the Department which, if met by a particular model, will result in the issue of a type approval certificate. En turn it enables manufacturers to issue certificates of conformity for individual vehicles.
  I draw the attention of hon. Members to the provisions of the inserted article 31(d)(iii) which would enable the Department to make regulations making the first licensing of a vehicle conditional upon its being type approved.
  Since most new vehicles will continue to come into Northern Ireland from Great Britain, and as it is proposed to apply exactly the same requirements as those in Great Britain, arrangements will be made to accept type approval issued in Great Britain as applying in Northern Ireland, and vice versa. In practice, since vehicle manufacture in Northern Ireland is negligible, most, if not all, applications for national type approval will be dealt with in Great Britain by the Department of Transport, which has facilities for testing and inspection and the issue of approval certificates.
  However, against the possibility that an application for approval would be made in Northern Ireland, arrangements would be made for the Department of Transport to act as agents for testing and inspection. That would mean that there would be no need to provide separate testing and inspection facilities in Northern Ireland.
  When the draft order was considered by the Northern Ireland Assembly, the position of personal imports was raised. I wish to make it clear that regulations made under this order will not be retrospective and that those who purchased imports through independent dealers have no cause for concern. The regulations would, as in Great Britain — we are being entirely consistent — exempt vehicles that qualify as personal imports from the requirement to produce type approval documentation.
  I appreciate that importation in bulk by parallel importers will fall outside the scope of that exemption and that, unless they can obtain the necessary documentation, their business will be adversely affected. That point was put to me forcibly by the Independent Car Importers Association, which sought the withdrawal of the draft order.
  However, as hon. Members may know, the Department of Transport and the Society of Motor Manufacturers and Traders have agreed a code of practice under which a parallel importer can apply to a manufacturer or to his accredited representative in Great Britain for the type approval certification needed to enable the imported vehicle to be first licensed in Great Britain.
  Under the code, that certification will be issued provided that the vehicle was built in conformity with an approved type or can be converted so as to comply. It is proposed that steps shall be taken to extend these arrangements to vehicles imported into Northern Ireland.
  That being the case, the order should proceed, given that it offers substantially increased protection to motorists in Northern Ireland and should enhance road safety. I therefore commend the order to the House.
  10.26 pm
  Mr. William Ross: My party welcomes the order, though it has been a long time coming. Its history goes back a considerable time, for the Government were being asked, not only by the motor agents in Northern Ireland but by my party—notably by the party's leader, my right hon. Friend the Member for Lagan Valley (Mr. Molyneaux), and my right hon. Friend the Member for South Down (Mr. Powell)—as far back as early 1982 to do something about the matter.
  It would seem that the problem arose, as the Minister said, because of a shift in the economic advantages of importing vehicles. Apparently the manufacturers cut the prices of the vehicles that they supplied to the Irish Republic because of the levels of car tax and VAT pertaining in the Republic. That meant that if one could avoid the tax, the vehicle was much cheaper in Northern Ireland, taking into account the sum actually charged by the manufacturer of the vehicle.
  In addition, the taxation policy on the collection of VAT was being altered in a way which rendered it even more beneficial to those who could import cars in large numbers, and it so happened that the Republic's assemblers of vehicles were protected by the Treaty of Rome from imports which were similar to vehicles being assembled in the Republic.
  To add to the burden on the folk in Northern Ireland, they were in great difficulty when it came to exporting vehicles to the Republic, because only registered exporters could send vehicles south of the border. Thus, it came down to being, for financial and trade reasons, a one-way street, and that bore heavily on those who were the traditional suppliers of cars and other vehicles in Northern Ireland.
  The VAT arrangements in the Republic apparently gave a time lag which at one stage enabled the importer to get his cars in and have them sold—not necessarily even in Northern Ireland but possibly in Great Britain— before they had to pay the VAT that was payable on the cars.
  There was, therefore, a considerable flood of cars coming across the border in early 1982 and for 12 months thereafter. It is hard now to say exactly how many were coming in. So many were at the game—those who were buying as individuals and those who were importing in quite large numbers—that nobody really knows the true numbers.
  The trade suspects that several thousand were coming across the frontier. However, I wonder, if that were the case, where all those cars went to. It is clear that they did not stop in Northern Ireland. One suspects that quite a few went straight out through Larne harbour to Stranraer, and goodness knows where they are now in Great Britain.
  In a Treasury parliamentary answer on 30 April 1982, my right hon. Friend the Member for South Down was told that five vehicles had been imported in October 1981 and that by March 1982 the number had risen to 442, a considerable number of vehicles for a population of 1·5 million. It is alleged that at that time, of all the Ford vehicles sold, two thirds were imports, and that more than half of the Mazdas sold were imports. At least a quarter of all cars sold in Northern Ireland were the grey imports from the Republic. After years, the position eased because of pricing and tax changes in the Republic. By June 1983, the figure was between 5 and 10 per cent., or even lower.

  1315
  There is no doubt that those who engaged in the importation of those vehicles were doing well and therefore, we should not be surprised that the independent parallel importers object to the regulations. Although at first sight those people appeared to be good for consumers, they were not good for the Province or consumers in the long run. The importers and sellers invested little, there were few jobs and little back-up if anything went wrong.
  The regulations have taken a long time to come to the House. On 27 May 1982 my right hon. Friend the Member for South Down received an answer from the Parliamentary Under-Secretary of State for Transport to the effect that he would try to introduce the regulations. I understand that at that time it was expected to take about nine months. When nine months extends into three years, one wonders how long it will take to get the legislation through the House.
  By 1 July 1982 we had been told in answer to a further question that the Government intended to introduce the legislation as soon as possible. By September 1982 the Department said that there were 100 prosecutions for the use of those vehicles pending. Perhaps the Minister would tell us what happened to them. From his remarks we know, but we would like it put clearly on the record. By 20 December 1982 Department of the Environment officials were saying that they hoped that the matter would be debated in the House about the end of 1983. That is more than a year ago.
  By 31 December we had been told that officials were working on the necessary legislation, and the proposals were eventually referred to the Assembly. Now, three years after the matter was first raised, we have the regulations on the Floor of the House, where they could have been a long time ago.
  We have only ourselves to blame. If the type approval regulations had been embodied in United Kingdom legislation rather than in Great Britain legislation, we would not be here tonight and we could all go home an hour or so sooner. The Minister made that point even better when he pointed out that the work done in Great Britain by the Minister of Transport is the deciding factor, and that the Northern Ireland Office would only pick up a rubber stamp and agree to accept the findings of the Great Britain authorities. It has taken far too long to get the regulations to the House. I hope that the cars are better constructed than the Orlit houses were, because we are running into severe problems with them.
  Despite the long delay, the Government have taken many measures, some of which were helpful, but all of which were certainly delaying tactics. The helpful measures were the use of the construction and use regulations to make threats to those who were buying imports. It was widespread in the news media of Northern Ireland that they might not be able to use their vehicles. There were the prosecutions, but they did not appear to come to much, and the changes in the tax and pricing arrangements by the manufacturers and the Dublin Government, which affected the economics of the importation of vehicles from the Republic.
  The legislation is widely welcomed and long awaited. It has been dragged slowly inch by inch—millimetre by millimetre, one should say nowadays — out of the Department. It is the best way to deal with the problem.
  1316
  I am glad that the efforts of my right hon. and hon. Friends have been brought to a successful conclusion. It shows that when Ulster has a just case and the matter is pressed home in the House, it can be brought to a successful conclusion. This is one of many successful conclusions during my years in the House. It also exposes the nonsense that is often about in Northern Ireland, that because there are only a few Members from Northern Ireland in the House they can never get anything done. We have got it done. It has been a long, slow process but it has been brought to a welcome conclusion. The fact that it has encourages us all to redouble our efforts for Northern Ireland's just case in other directions.
  My right hon. and hon. Friends fought the battle to a successful conclusion. We hope that in the future the Minister will listen to us rather more readily and act a great deal more speedily, and then we can all get home a great deal earlier.
  10.36 pm
  Mr. Peter Robinson: The hon. Member for Londonderry, East (Mr. Ross) referred to what he saw as the delay in bringing forward this draft order to the House. The Minister will want to respond to that. I understand that during the Assembly process, when we were considering the draft order, it was said that his Department had experienced some anxiety about the welding of two vehicles that had been imported into Northern Ireland — the Mazda 323 and the Toyota Starlight. The Department was worried about what might happen if there were a collision. If the anxiety was as great as we were told, I wonder why the legislation did not come forward somewhat faster.
  It is to some extent a comfort to the Minister to recognise that the burden of complaint by Members in the House centred around the fact that the legislation did not come earlier. That shows that the substance of the order is generally accepted by Members in the House.
  The essence of the order is to ensure an acceptable standard of vehicle. I note that in the communications from the motoring organisations, the RAC and the AA give a warm welcome to the order, as does the Royal Society for the Prevention of Accidents.
  There is a difference of opinion between the two organisations involved in the selling of cars. The Motor Agents Association as one would expect, is in favour of the draft order, whereas the motor importers seem to be fighting strenuously to the last. We can, of course, understand their anxiety even if we do not altogether share it. However, the general view of those of us in the Northern Ireland Assembly who have studied the draft order is that the independent view expressed by those with an interest in road safety should be taken more seriously than the views of those who have a vested interest, although that is no reason to ignore anyone's views.
  When the Minister refers to import controls and says that personal imports are exempt, what thought has he given to the fact that it will be relatively easy for anyone who is so minded to carry out a relay system by personally importing cars from the Republic of Ireland into Northern Ireland? To what extent will personal imports be limited? Will someone who is travelling from the Republic to Northern Ireland once a day, week, month or year be subject to a restriction on the number of personal imports that he can bring into Northern Ireland, and from Northern Ireland into the rest of the United Kingdom?

  1317
  Is it a fact that the price of vehicles in Northern Ireland could change fairly radically? A number of Northern Ireland citizens are expressing this fear. The Northern Ireland Car Importers Association has suggested that car prices in Northern Ireland will be increased if competition is stifled. It will be helpful if the Minister will express a view on the substance of the association's claims.
  In common with the hon. Member for Londonderry, East and many in Northern Ireland, I welcome this measure, even though it is late in appearing before us. I do not want to delay its passage further.
  10.41 pm
  Mr. J. Enoch Powell: I find myself somewhat weirdly reminded by the order and the debate of Sir Robert Peel, the corn laws and the potato famine. The House will recall that Sir Robert was always intending to do something about the corn laws. When there was a potato famine in Northern Ireland—it had nothing to do with the corn laws and it would not have been alleviated by their repeal—he seized upon that event and, without arguing too nicely the logical relationship between the two, put forward the famine as a reason for repeal. It was one which no decent person could resist in co-operating with the proposed legislation, which he desired strongly upon other grounds.
  As my hon. Friend the Member for Londonderry, East (Mr. Ross) has generously recalled, I was one of those who were in correspondence with the Minister's predecessor three years ago about certain difficulties which were arising both for consumers and the trade in Northern Ireland as a result of imports from the Irish Republic. In the subsequent year or two, and for various reasons, the majority of which my hon. Friend touched upon, the problem put itself right. However, in the course of the examination of it, the fact that Northern Ireland was destitute of type approval legislation came to attention, and properly the Minister's predecessor recognised that this was something which should be put right. Certainly we should have some law in Northern Ireland in this respect, and we should always have had it, as on the mainland. It is welcome that the omission is now being made good. I thought that it should be recorded that the connection between the happy event occurring tonight and the difficulties of the year 1982 is anything but direct.
  10.44 pm
  Mr. Stuart Bell: It is always a pleasure to take up the remarks of the right hon. Member for South Down (Mr. Powell), who managed to deliver a small but pertinent history lesson in the course of discussing the order.
  The Minister referred to consumer protection and road safety and the order seems to marry the two issues. The Opposition have noted that the purpose of the order is to ensure that new vehicles offered for sale are constructed to accepted international standards. We take on board the comment of the hon. Member for Londonderry, East (Mr. Ross) that the order has been some time coming. The right hon. Member for South Down described how it came to the attention of the Government in 1982. Nevertheless, we now have it. It offers protection and tries to guarantee to purchasers that vehicles, whatever their country of origin, comply fully with the requirements of road traffic law.
  There was some severe criticism from the Independent Car Importers Association, which was worried about free
  1318
  trade in the European Community, in case the order would be in breach of the treaty of Rome, that it might increase the price of vehicles to consumers, about redundancies and about the possibility of inflated prices. Those anxieties were communicated to the Government through the Assembly, and the Environment Select Committee asked that the Government chat to the Independent Car Importers Association again. That happened and, through the Minister, the Government took cognisance of the association's views. There were further discussions.
  A memorandum in the file that has been prepared by the Department of the Environment answers some of the criticisms. One paragraph of the memorandum states:
  "If members of the Car Importers Association import vehicles which do not have type approval and wish to continue to sell those vehicles they will probably incur expenditure in arranging for type approval; whether those costs are passed on to the purchaser is a matter for the importer."
  The Opposition have followed this debate with some care. The speeches have not lost any of their lucidity in their brevity. The Minister carefully said what the order was about. We offer our support for it, as do the other parties in the House.
  10.47 pm
  Mr. Chris Patten: I shall try to be as brief as others have been, even if I cannot manage to be so lucid.
  The hon. Member for Londonderry, East (Mr. Ross) referred to the delay since a certain amount of dignified pressure was applied to my distinguished predecessor, now the Parliamentary Under-Secretary of State for Transport, in 1982. There are several reasons for the delay on this important matter, and I do not believe that we can be accused of being too dilatory. It was necessary to engage in some fairly protracted consultations to try to satisfy — not wholly successfully I must admit — the conflicting interests in this issue. There has also been a great deal of Northern Ireland legislation in the past couple of years, as right hon. and hon. Members on both sides of the House will know. Some has been regarded as having higher priority than this, not least by the parliamentary draftsman. Nevertheless, I am sorry that we have not been able to act before. None of us is perfect, but at least we have the order before us now.
  The hon. Member for Londonderry, East asked about prosecutions. The users of imported vehicles which do not conform to the construction and use regulations and/or the lighting regulations are not being prosecuted, mainly because it is thought that the purchasers of imported vehicles would find it difficult or impossible to obtain information on whether their cars conformed to each of the relevant provisions of the construction, use and Lighting regulations. For example, vehicles imported from or built for sale in the Republic of Ireland might not carry the appropriate markings to demonstrate compliance. The implementation of the order will substantially remove the need for future prosecution of this type.
  Mr. William Ross: I apologise for interrupting the Minister, but I am curious about whether he had a word with the insurance companies. If somebody who has bought a vehicle which does not comply with the type regulations has an accident resulting from a fault, what will happen about his insurance?
  Mr. Patten: If such an accident has already happened, as the legislation is not retrospective the driver of the

  1319
  vehicle will be in no difficulty after the legislation is passed. To get the vehicle licensed, the purchaser will have to go to the centre at Coleraine, and since his warranty will not show that type approval has been granted he will be unable to get a licence for the vehicle. I very much hope that such a situation will not arise.
  The hon. Member for Belfast, East (Mr. Robinson) asked whether somebody purchasing cars in the Republic and bringing considerable numbers into Northern Ireland would or would not satisfy the conditions for genuine personal imports. Personal imports have to satisfy fairly clear conditions. The vehicle must have been purchased outside the United Kingdom for the personal use of the individual importing it, or for his dependants. Secondly, the vehicle has to be shown to have been used by that individual or his dependants on roads outside the United Kingdom before it was imported. Thirdly, the vehicle has to be imported solely for personal use in the United Kingdom. Finally, the individual importing the vehicle has to show that he intends at the time when the vehicle is imported to remain in the United Kingdom for not less than 12 months from that time.
  The second point raised by the hon. Member for Belfast, East related to car prices. I do not believe that car prices should be affected by the order. While the cost of type approval can be substantial, it is minimised when costs are spread over a long production run. Therefore, the introduction of type approval should not lead to increased prices. I hope that the hon. Gentleman will be comforted by that fact. A recent House of Lords study of the European Commission's proposals on car pricing showed that car prices are determined by a complex series of factors; for example, the policies of individual Governments, price control, taxation policy, exchange rates and so on.
  The right hon. Member for South Down (Mr. Powell), who deserves much of the credit for this order, reminded us of the 19th century and in particular of Robert Peel. Putting recent controversy on one side, I think he demonstrated that Robert Peel was indeed a very proper Tory.
  The hon. Member for Middlesbrough (Mr. Bell) referred to the importance of the order both in terms of consumer protection and in terms of the improvement of road safety. It was doubtless for those reasons that, as the hon. Member for Belfast, East pointed out, the draft order was not only approved and accepted enthusiastically by the Assembly but was supported by the Automobile Association, the Royal Automobile Club and the Royal Society for the Prevention of Accidents. Following their support, I hope that the order will be supported by the
  1320
  House and that in doing so the House will recognise how much we owe to those right hon. and hon. Members representing Northern Ireland constituencies who have laboured in this particular vineyard and brought forth this particular crop.
  Question put and agreed to.
  Resolved,
  That the draft Road Traffic (Type Approval) (Northern Ireland) Order 1985, which was laid before this House on 18th February, be approved.

  Road Traffic (Northern Ireland)

    AGRICULTURAL TRAINING BOARD BILL [MONEY]
    Queen's Recommendation having been signified—
    Resolved,
    That, for the purposes of any Act resulting from the Agricultural Training Board Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to that Act in the sums so payable under any other enactment— [Mr. Lennox-Boyd.]

    RATING AND VALUATION
    Motion made, and Question put forthwith pursuant to Standing Order No. 79(5) (Standing Committee on Statutory Instruments, &c.).
    That the draft Docks and Harbours (Rateable Values) (Scotland) Order 1985, which was laid before this House on 18th March, be approved— [Mr. Lennox-Boyd.]
    Question agreed to.

    RESERVE FORCES (SAFEGUARD OF EMPLOYMENT) BILL [Lords]
    Resolved,
    That in respect of the Reserve Forces (Safeguard of Employment) 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. Lennox-Boyd.]

    HOUSE OF COMMONS MEMBERS' FUND
    Resolved,
    That in pursuance of section 2 of the House of Commons Members' Fund Act 1939, Sir Geoffrey Finsberg be appointed a Managing Trustee of the House of Commons Members' Fund in the room of the late Sir Anthony Berry. — [Mr. Lennox-Boyd.]

    PARLIAMENTARY CONTRIBUTORY PENSIONS FUND
    Resolved,
    That in pursuance of section 1 of the Parliamentary and Other Pensions Act 1972, Mr. Peter Hordern be appointed a Managing Trustee of the Parliamentary Contributory Pensions Fund in the room of the late Sir Anthony Berry.—[Mr. Lennox-Boyd.]

  Public Service (Morale)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lennox-Boyd.]
  10.55 pm
  Mr. Robert Jackson: Last weekend, the Sunday Telegraph quoted Mr. Keith Hall of the Institution of Professional Civil Servants at the Agricultural and Food Research Council Letcombe laboratory in my constituency as saying that
  "scientists are leaving the service because they are so unhappy with the way it is now being run. Morale is very low, and some people moving from here to other establishments know that their jobs might be at risk".
  I was not thinking of Letcombe when I first applied three months ago to raise on the Adjournment the matter of morale in the public service. Nor do I have in mind exclusively the thousands of scientists and scientific staff working in the public sector in my constituency at Harwell, at the Rutherford laboratory, at the Royal College of Military Science at Shrivenham and just over the constituency border at Oxford university and the Culham laboratories. Rather, I want to consider the state of morale in the public service in its widest aspects. I want to look at the situation of all those in the civil employment of the Government, working in what economists describe as the non-market sector. Here I am thinking of all the hundreds of thousands of central Government civil and scientific servants and the employees of health authorities and local authorities, including teachers—in short, all the hundreds of thousands of people who make up such a large proportion of our constituents.
  Let the Letcombe story, however, serve as an illustration of my theme because it illustrates the issues very well. In a nutshell, the closure of the Letcombe laboratory, which I did not criticise or oppose, came about as a result of a reappraisal by Government and their agencies of the costs and benefits of a whole line of policy — in this case, that of the public provision of agricultural research, especially in the production of cereals. What has happened—a fact which the Sunday Telegraph failed to mention in its criticism of the closure — is that Dow, a private sector firm engaged in agricultural research, has bought the Letcombe site and proposes to expand there.
  At Letcombe we see the particular manifestation of a general phenomenon, that of Government deliberately reducing the commitments of the non-market public service to make room — quite literally in the case of Letcombe — for the expansion of market-oriented business, chiefly in the private sector. That is a strategy which I and all Conservative Members support and which has the approval of some of the saner Labour Members, not to mention the alliance—at least when it is turning its tough rather than its tender face towards the electorate. Moreover, it is at least arguable that the strategy was approved by the country in 1979 and 1983 when this revision of the role of Government was the fundamental issue in two general elections.
  At the heart of the matter is the fact that the nation, or at least the major part of it, seems to have arrived at lower expectations of what can be achieved through the agency of Government and hence of the public service. Moreover, in all the activities of the public sector it is looking for the
  1322
  closer relationship between costs and benefits that is experienced under market disciplines and by the use of managerial techniques developed in the private sector.
  For those employed in the public sector, this change has had profound implications. I wish to spell out just three of those which I consider to be most important.
  First, the Government's efforts to create the conditions for a market-led British economic renaissance through tax cuts and the reduction of public borrowing has had a powerful impact on public sector employment. Between 1979 and 1984, the number employed by central Government fell from 732,000 to 617,000, and in local government the number fell by a similar but lesser order. As a result of these changes, whose implementation, it must be admitted, has involved an inescapable arbitrariness, the work loads on individuals have undoubtedly increased, promotion prospects have been reduced and at the same time in many areas the scope and interest of the work has diminished.
  As to wages and salaries, the position is more complicated, because so much depends upon the choice of a base year for comparisons. Undoubtedly some sections of the public service have seen real cuts — I think particularly of university teachers — while for most, including school teachers, the real value of their incomes has at least been sustained since 1979. Broadly, however, the picture seems to me to be one of a movement from an historic pattern, which lasted until the late 1950s, of relatively low salaries in the public sector bound up with greater job security, through a period in the 1960s and early 1970s when public service salaries rose relative to the private sector, but with no loss of job security, to a trend since the mid-1970s back towards the original pattern. While no doubt this is a more sustainable position, the return to it has certainly disturbed the exaggerated expectations built up in previous years.
  There is a second implication of the new approach, the effects of the programme of privatisation and "contractorisation", together with the introduction of new management techniques which emphasise direct responsibility and accountability.
  By the end of the 1980s, privatisation, coupled with the growth of trading funds in the public sector and the reduction of direct labour, will have removed hundreds of thousands of public employees from what they have often felt to be the security and stability of the public service to the perceived insecurity and risks of the market place. Within the central Civil Service, in the Health Service and, as we see, in the current teachers' dispute, there is a new emphasis on stronger line management and on performance, and this new emphasis is also disturbing traditional hierarchies and exposing the public service to unfamiliar and disturbing pressures.
  Then there are the implications of the Government's efforts to promote a revived enterprise culture. This emphasis on the role and value of the wealth-creating entrepreneur is bound to have some impact on the self-regard of public servants and the esteem in which they are held by society at large.
  Here we are in the difficult realm of psychology, and sometimes irrational psychology at that. Nevertheless, it is a real question what conclusions a public servant, whether in Whitehall, county hall, in the schools, in hospitals or in government laboratories, should draw from

  1323
  the idea—perhaps it is a caricature—that what matters most is the creation of new wealth by go-getting risk takers buying and selling in the market place.
  Does this mean, some ask, that the rest of us are parasites? From the ethical point of view, does it mean that caring is less important than wealth creation? From the economic point of view, does it mean that the creation of wealth can be dissociated from the provision of those external public goods which sustain the framework of the market place and facilitate its workings? If one of the causes of the British disease is a culture hostile to enterprise, does this mean that the values imparted or reinforced in our schools and universities are wrong—that our teachers have the wrong values?
  These are all good questions, and I dare say that all hon. Members are finding that they are questions which in one way or another are being asked with growing insistence every time we open our postbag or visit offices and schools in our constituencies.
  It is these questions, this experience, which have prompted me to raise on the Adjournment the problem of morale in the public service. That there is a problem no one could doubt, although I guess that my analysis of its origins may be more controversial. What we can and should do about it is yet another matter.
  For my part, I do not believe that the answer lies in an abandonment of the more rigorous approach to the purposes and cost-effectiveness of the public service that has prevailed since 1979 — or was it 1976? The diminished expectations of what can be achieved by Government and their servants, and the greater emphasis on value for money: those are not only welcomed by most of our people, including most public servants, but they represent a historical shift paralleled by trends in other advanced industrial countries of the First world.
  The truth is that throughout the West we have come to the end of an exceptional period of some 40 years in which exaggerated hopes were placed in Government. We hoped for ever-expanding economic progress and for ever-rising standards of welfare and popular education. To secure those goods, we put our faith in a public administration growing in numbers, remuneration and prestige. After 40 years of that, we have everywhere in the West reached a more realistic sense of the limits of what Government can do. We know that the public service cannot create wealth directly and that it frequently consumes more than it produces. We know that in health and education more does not necessarily mean better. In all that, it follows that a Government with more modest aims implies a public service of more modest dimensions, receiving more modest rewards, and playing a generally more humble role in the scheme of things.
  Therefore, the solution of the problem of morale in the public service does not lie in more pay or greater numbers. Rather, I believe that it lies in the more difficult and less tangible area of psychology to which I referred when I spoke about the implications for the public service of the attempt to rebuild an "enterprise culture" in Britain. The Government — my party — are right to perceive at the heart of our economic difficulties a problem of values. It is true that mid-20th century Britain—the Britain which wound up the empire and developed the welfare state—was a Britain that placed too much emphasis on distributing wealth rather than creating it.
  1324
  However, I fear that in pursuing a cure based upon that diagnosis we may have narrowed our focus excessively and even perhaps lost something of that balance that is required in all things. Britain is, and will remain, a country in which the values of an enterprise culture must flourish alongside other values that are not necessarily opposed to them—the values of caring, healing, teaching and the pursuit of knowledge for its own sake. The Conservative party is, and must remain, a party in which the values of the businessman run in harness with the tradition of public service.
  In conclusion, I return to Letcombe. In spite of the regrettable actions currently being undertaken by civil servants and teachers, from my experience of that closure I would say that the core of the ethos of public service —that willingness to put the wider interest first—still exists. The people concerned at Letcombe could and did understand the need for reduction and rationalisation, although in some cases it took place at the expense of their private interests. Many, indeed probably most, public servants understand the need for radical changes if Britain is to break out of her deep-rooted pattern of relative economic decline. However, that appreciation will be sustained only if as a Government and as a party we continue for our part to show our appreciation of the vital role in Britain's future of a committed and well-motivated public service.
  11.8 pm
  The Minister of State, Treasury (Mr. Barney Hayhoe): I congratulate my hon. Friend the Member for Wantage (Mr. Jackson) on his wide-ranging and elegant speech, which deserves a better reply than he will get from me. It will be worth study by people who are concerned with the public service. The subject that he raises is of high importance. However, as he acknowledged, it covers a vast area. In a 30-minute debate it is difficult to deal adequately with the range of the subject.
  As my hon. Friend acknowledged, the public service embraces over 5 million employees. Roughly one in five of the working population is employed full time or part time in the armed forces, the National Health Service, by local authorities, in the education service and the universities, and in the Civil Service. It is only the Civil Service for which I have particular and direct responsibilities, although I well recognise the importance of high morale in every area of the public service and at every level within it.
  My hon. Friend referred to a few specific cases, and particularly to the Letcombe laboratory, which closed as from 31 March this year. I understand that the work that was being carried out at Letcombe will be maintained following the merger with Rothamsted. Indeed, the intention is that it should be strengthened by putting it alongside a wide range of related scientific disciplines and field experiments. I think that the comments made by the IPCS representative, to which my hon. Friend referred, were unduly exaggerated, taking account of the particular circumstances. I was, of course, delighted to hear from my hon. Friend that the site has now been taken over and is to be used. I hope that it will offer employment to people in the locality.
  My hon. Friend also referred to the Royal Military College of Science at Shrivenham. I must be one of the few people who have never been in the armed forces but have nevertheless done a course at Shrivenham on atomic

  1325
  energy. While I was there I also visited the United Kingdom Atomic Energy Authority establishment in Harwell, so I have many connections with the area of the country from which my hon. Friend comes.
  Shrivenham has seen changes. It has moved towards the teaching staff being privatised by a contractual arrangement with the Cranfield Institute of Technology. From what I hear, that is going extremely well.
  We need to remember that across the whole field of our public service we have some areas which have a quite remarkable worldwide reputation for scientific excellence. I mentioned Harwell a moment ago, which certainly would fall into that category. One sees a major and significant role in the years ahead for those parts of the public service.
  We acknowledge the problems and difficulties of recent years, but looking particularly at the Civil Service, and thinking of the time when I, as a very junior member of the scientific and engineering parts of the Civil Service between 1944 and 1963, was occupied with technical matters, I see that enormous changes having taken place. These have occurred not least over the last six years, when a very determined effort has been made by the Government.—as was recognised by my hon. Friend—to change the patterns of thinking within the Civil Service, which had over the years developed a remarkable facility for carrying out the duties placed upon it by this Parliament and by the Executive, sometimes in such a way that the carrying out of the task or function appeared to be the absolute aim, without real concern for the costs of the operation. One of the great contributions which has come from my right hon. Friend the Prime Minister and, particularly, from Lord Rayner, who aided her very much in the early years of her Government, has been in getting a much greater awareness of the need for cost-effectiveness in the operations within the public service, just as the discipline of the bottom line in private industry imposes that discipline on people in the private sector.
  The changes that we have seen—and my hon. Friend mentioned privatisation, which at least in part has led to the reduction in numbers in the Civil Service, to which he referred, although most of that reduction has come from improved efficiency within the service—have brought a great deal of uncertainty, problems for management and understandable concern among the staff. Inevitably, morale has been affected. More effort must be made to achieve better communications and to improve management skills.
  Good communications between management and staff have traditionally received too little attention within the Civil Service. But Departments have now identified them as a priority. Much is being done with welcome innovations in the communications methods and media used.
  Effective communications can help civil servants understand how their work is used, why changes in procedures and methods are necessary, and how they will be affected by changes. In industry, studies show that the increased understanding that goes with better communications results in increased productivity, fewer industrial disputes, and better customer relations. We set similar targets within the Civil Service.
  Individual Departments have carried out their own scrutinies of internal communications. Last year the Cabinet Office and Treasury commissioned a major study by specialist consultants of communications between management and staff across the whole of the Civil
  1326
  Service. The consultants are now completing their report and I look forward to seeing what improvements they recommend.
  Centrally, we have tried to emphasise the importance attached to good communications in other ways: for example, by initiating a new series of newsletters for distribution to managers throughout the Civil Service; by circulating to a network of communications contacts in Departments examples of good practice, from both the public and private sectors; and by organising seminars and training courses for Civil Service managers at senior levels. Much greater emphasis is being put on management techniques and skills.
  In the past, management information on, for example, pay or conditions of service often came to the staff via trade union channels rather than directly from management. It is no wonder that its presentation sometimes left much to be desired. Now management has better accepted, and is better carrying out, its essential task of keeping individual members of staff properly informed. I hope that it is also becoming more responsive to suggestions and ideas about improving the efficiency and effectiveness of the work done. Good management requires genuine two-way communications. This in turn helps keep morale high.
  Of all parts of the public service, the Civil Service attracts the most unfair and ill-informed criticism generally, and particularly in the popular press. Yet the Civil Service does essential work for the community. It discharges tasks given it by Parliament and the Executive with a dedication and spirit of service which deserves high commendation.
  It is a pity that some Civil Service union leaders are seeking to manipulate the staff of Her Majesty's Customs and Excise to inconvenience the public to attract publicity for their pay claim. It is unfortunate that on a day when this matter is being raised in such a broad and generous spirit in relation to the whole of the public service, some trade union leaders should behave so cynically by urging their members to disrupt holiday traffic over the bank holiday weekend.
  It is not appropriate to discuss pay tonight. It is better that private talks and negotiations continue. I hope that a settlement of the present dispute within the Civil Service will be reached. Plans for strikes and disruptive action by the unions concerned are inappropriate at this time.
  The Government believe that pay levels must be such as to recruit, retain and motivate sufficient staff of the quality needed to carry out the work asked of them. That approach has determined our attitude in the pay negotiations in recent years. Recruitment is generally satisfactory, although there are some problem areas—for example, among scientists, engineers, accountants, personal secretaries in London and executive officers, although it is worth noting that a much higher proportion of the new entrants to the executive officer grade are graduates than was the case in past years. I am delighted that recruitment of administrative trainees into the Civil Service—the high flyers for the future—was much more satisfactory in 1984 than in some other recent years.
  The Civil Service competes with other employers in the public and private sectors, and so it should. I do not believe that the Civil Service should have some prior claim on the best talent, but it would be a bad and sad day if the Civil Service did not continue to attract people of high ability and great dedication. I share my hon. Friend's concern about the over-sharp distinction which is

  1327
  sometimes made between the public service and the private sector, as though one were good and the other were bad, and as though in some way, because the private sector was wealth creating and the public service was wealth consuming, one was superior to the other. That is a totally mistaken view.
  Of course we must do just what my hon. Friend suggested. We must get the balance right, encouraging the enterprise culture, which must develop and expand if we
  1328
  are to get the jobs and the prosperity to which we all look forward, but doing so in a way that does not demean or detract from the essential contribution that must come from the great areas of public service within our society. If this debate has done no more than assert again the importance of the private and public sectors and the partnership and proper balance between them, it will have been well worth while.
  Question put and agreed to.
  Adjourned accordingly at twenty-three minutes past Eleven o'clock.

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

Agriculture R & D: Funds
Lord Mackie of Benshie: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. I apologise to the House for the fact that perhaps a comma or two is missing, but the meaning is perfectly clear.
The Question was as follows:
To ask Her Majesty's Government whether they consider that research and development institutions in agriculture have been given enough time to seek replacement of the funds lost through Government cuts from sources in the industry.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead): My Lords, under the revised expenditure plans which have been announced for the funding of research and development by the agriculture departments, no reductions are envisaged in 1985–86. We believe this will allow adequate time for preparations to be made to secure the closer involvement of the industry in the research effort.
Lord Mackie of Benshie: My Lords, is it not a fact that although the Minister's Answer indicates that a certain amount of time will be allowed, it will be hardly enough for the Scottish Agriculture Advisory Service, for example, to replace about 41 per cent. of its expenditure?
Lord Belstead: My Lords, as my original reply indicated, we think there is time. However, we have asked for the advice of the Priorities Board on Research and Development and we are awaiting that advice on the prospects of industry funding.
Lord Davies of Leek: My Lords, I thank the noble Lord the Minister for his replies up to now. This is a very important matter. Is the Minister aware that the cut in research on animal welfare and agriculture is undermining British prestige in the world, whereas at one time Britain was famous worldwide for its breeding and its agricultural research work, including that on animals?
Lord Belstead: My Lords, Government spending on the entire agricultural, fisheries and food research is around the £200 million mark. This compares very well internationally.
Viscount Brookeborough: My Lords, is my noble friend aware that agriculture is the most important industry in Northern Ireland? Is he also aware that with the average size of farm being 40 acres, no matter
224
how much time is given, there is no prospect of those farms becoming involved if the cuts applied to Northern Ireland are to be the same?
Lord Belstead: My Lords, my right honourable friend the Secretary of State for Northern Ireland has not made any statement about research and development.
Lord Cledwyn of Penrhos: My Lords, will the noble Lord be good enough to say what consultations have taken place with the Agricultural and Food Research Council and, in particular, with the noble Earl, Lord Selborne, who is its chairman? Is the Minister aware that there is considerable apprehension throughout the country, and particularly in Wales, where there has been a recent severe cut in the work of the plant breeding station at Aberystwyth, which has served not only this country, but also the third world? Can he say, first, what consultations have taken place? Secondly, given that there have already been swingeing cuts in the agricultural institutions, can he say whether any further severe cuts will be made at, say, the Welsh plant breeding station?
Lord Belstead: My Lords, as I made clear to the noble Lord, Lord Mackie, we are consulting the Priorities Board on Research and Development, which was set up within the last year, on both the scope for industry funding in the future and the priorities there ought to be in Government spending on research and development. The Agricultural and Food Research Council is represented on that board in the person of the director and general secretary, Sir Ralph Riley. I cannot give an answer to the noble Lord about the Welsh plant breeding station because we must wait for advice from the priorities board before deciding on our plans.
Lord Cledwyn of Penrhos: My Lords, I thank the Minister for that answer. Can he tell the House whether cuts will be made by the Government before there is any assurance of further assistance from industry?
Lord Belstead: My Lords, as I said, we must wait for advice from the priorities board. What is certain is that the money which my right honourable friend the Minister of Agriculture has said will be saved on research and development in the next two years, 1986–87 and 1987–88, totalling £10 million, and then £20 million in the following year, has to be found. But exactly how it is to be found will depend in large measure upon the advice of the priorities board.
Lord Mackie of Benshie: My Lords, I hope that the Minister will be able to give the House an assurance that the Government do not regard these cuts as being necessary or possible now because of the very success which farming, in combination with research, has had in producing food and, indeed, surpluses.
Lord Belstead: My Lords, I have already given a figure for total research and development spending in this country. Even after reductions, we will compare very well internationally.
Lord Elwyn-Jones: My Lords, can the noble Lord enlighten us about the nature of the priorities board? Who set it up? Who are its members? What are its terms of reference?
Lord Belstead: My Lords, the board was set up by my right honourable friend the Secretary of State for Education and Science, Sir Kenneth Durham, chairman of Unilever, is its chairman. It is giving advice in the ways I have indicated in my previous answers, and its members include the director and general secretary of the AFRC itself, Sir Ralph Riley.

Scottish Universities & Colleges: Grants
2.42 p.m.
Lord Mackie of Benshie: 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 why engineering departments in Scottish Universities are not sharing in the £14,000,000 now being allocated to central institution engineering and technology colleges.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, Scottish universities and central institutions will share in the additional funding being made available through the switch programme. My right honourable friend the Secretary of State for Scotland funds, through the Scottish Education Department. Scottish central institutions while the Scottish universities are funded through the University Grants Committee by the Department of Education and Science. My right honourable friend the Secretary of State for Education and Science is making an announcement later today in which he will give details of the first phase of allocations to the universities.
Lord Mackie of Benshie: My Lords, I thank the noble Lord the Minister for that Answer and see no necessity to put the many nasty supplementaries I have prepared. It is very good news indeed and I thank the noble Lord again for his reply.
Lord Ross of Marnock: My Lords, may I be allowed to ask a nasty supplementary question? Can we be assured by the Minister of State for Scotland that because of the redistribution the central institutions in Scotland will not be deprived of their share of the moneys allocated to Scotland in order to enable the Secretary of State to damp down the Tory revolt on rates in Scotland? He said he is going to take £38 million from the rest of the money, and that this will come from other services, including education and higher education.
Lord Gray of Contin: My Lords, the noble Lord, Lord Ross of Marnock, is very adept at manoeuvring into the position from which he wants to fire; but on this occasion I can assure him that he is not accurate in his supposition. The £14 million announced by the Secretary of State for Scotland as being available for
226
central institutions is not in any way affected by the announcement which my right honourable friend the Secretary of State for Education and Science will make today. Any money mentioned by him for the universities will not in any way affect the central institutions.
Lord Ross of Marnock: My Lords, I was not speaking about the universities. He knows that I know the universities are not—
Noble Lords: Order!
Lord Ross of Marnock: My Lords, the money is not given by the Secretary of State. The central institutions—
Noble Lords: Order, question!
Lord Ross of Marnock: My Lords, is the noble Lord aware that the central institutions are funded by the Secretary of State? It is the Secretary of State's responsibility that I am questioning. Is he further aware that the Secretary of State is to make an announcement at the end of this week on where he is to find that £38·5 million?
Lord Gray of Contin: My Lords, the noble Lord has been Secretary of State and should know the answer to these questions. However, it was some time ago, I admit; and in case he has forgotten, let me assure him that the £14 million to which I refer is being funded directly by the Secretary of State and is not in peril in any way.
Baroness Carnegy of Lour: My Lords, is the Minister aware that the University of Dundee suggested a way of getting round this technical difficulty within the Scottish Education Department? It suggested that the money saved from Scottish general university student grants might be transferred to supporting special grants for post-graduate students on courses in remote sensing electronics and in computer science; those courses having been set up specially by the Manpower Services Commission in response to acute need in Scotland. Was this considered, and if not, why not?
Lord Gray of Contin: My Lords, as my noble friend will appreciate, the funding of the Scottish universities is through the University Grants Committee. I have no doubt that the University of Dundee will have made its suggestions available to that committee. Of course, we have no jurisdiction over the findings of the committee.
Baroness Carnegy of Lour: My Lords, does the Minister not agree, however, that what the University of Dundee suggested—the funding of students—does not come through the University Grants Committee?
Lord Gray of Contin: My Lords, that is a point which obviously will have to be considered by the University Grants Committee. I have no doubt that the points made by the University of Dundee will be given due consideration.
Lord Mackie of Benshie: My Lords, I am now somewhat confused. As I understood the Minister's reply, part of the £14 million is now, in line with England, being funded through the University Grants Committee to the engineering departments of the Scottish universities, which produce much sought after graduates.
Lord Gray of Contin: My Lords, I must correct the noble Lord. The £14 million to which I referred is being used, and will be awarded by the Secretary of State for Scotland to the central institutions. The universities come under a different funding. They are funded by the University Grants Committee. An announcement concerning distribution will be made later today by my right honourable friend the Secretary of State for Education and Science.

Drug Rehabilitation Centres: Funding
2.48 p.m.
Lord Rodney: 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 acknowledge that under existing Treasury rules there is a risk that well-established drug rehabilitation centres may have to be closed for lack of funds, while at the same time newly-established centres are guaranteed grant aid for three years.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Baroness Trumpington): My Lords, the department makes grants to national voluntary organisations, or to local experimental projects, only for an initial period, usually three years. Thereafter, the responsibility for funding rests with the relevant health authorities and social services departments. It is for them to ensure that successful established drug rehabilitation centres do not close unnecessarily.
Lord Rodney: My Lords, I thank my noble friend for that Answer, which I do not find altogether reassuring. Is she aware that the Still Waters Rehabilitation Centre in Essex may have to close because its lease has expired and it has been unable to get any assistance from the Department of Health and Social Security to purchase the premises? Nor has it been able to get any assistance from the local health authority. This a well-established and valuable centre, and the sum involved is only £30,000 or £40,000. Can this matter be looked into?
Baroness Trumpington: My Lords, in answer to my noble friend Lord Rodney, I understand that an application for a grant to purchase the property under a mortgage has been submitted to the department. The project has been asked to provide further information.
Lord Kilmarnock: My Lords, is it not the case that the Government have pledged £10 million over three years for this and related purposes? Can the sum referred to by the noble Lord, Lord Rodney, not be found out of that amount?
Baroness Trumpington: No, my Lords.
Lord Ennals: My Lords, does the noble Baroness not realise that as a result of the limitations on rate support grant, rate-capping and rate penalties local authorities are finding it more and more difficult to give the support to which she referred to drug units in the community? Will she accept that the £10 million over the next three years referred to by the noble Lord, Lord Kilmarnock, is quite inadequate to deal with a problem of epidemic proportions and horrendous size?
Baroness Trumpington: My Lords, to take the last part of the noble Lord's question first, however much money was spent and however many establishments were opened, I believe that we should still be hitting only the tip of the iceberg. It appears that financial provision alone would not be adequate in view of the very disturbing trend. On the question of rate-capping, the control is on total spending by each authority, and the authorities themselves will continue to decide relative priorities among their various services. There is no suggestion that a reduction should be made on an across-the-board basis, and there is no reason for authorities to reduce valuable services for the most vulnerable.
Lord Avebury: My Lords, to what extent does the existence of centres for the treatment of addiction to drugs or alcohol enable the courts to send offenders to them rather than to award them prison sentences? If the noble Baroness does not have any figures on that, will she suggest to the Department of Health and Social Security and the Home Office that research should be carried out to establish the link between those two matters? If there is one, surely expenditure on those centres should be a national responsibility and not that of local authorities.
Baroness Trumpington: My Lords, I think that that question is a little wide of the one on the Order Paper. Nevertheless, I am sure that my right honourable friend will be interested to read what the noble Lord has said.
Baroness Macleod of Borve: My Lords, is my noble friend aware that the invaluable work done by the London Street Agencies is likely to come to a close? Although it has been funded, as the Minister said, for the past three years, local hospital authorities are now supposed to be funding the agencies and have stated that they can fund only one-eighth of the amount that was given previously. Will she look into the problem?
Baroness Trumpington: My Lords, in point of fact the London Street Agencies were given an exceptional extension in grants to a final fourth year. The projects must look to health authorities and local authorities for future funding. The grants from the department ended on 31st March of this year.
Lord Ennals: Oh, no!
Lord Cledwyn of Penrhos: Next year?
Baroness Trumpington: It is 1985, my Lords. But I understand that the Standing Conference on Drug Abuse is attempting to establish a committee of existing and potential funders of ROMA and the street agencies with a view to securing agreement on future funding.
Lord Kilmarnock: My Lords, can the noble Baroness elaborate on her monosyllabic reply to me and indicate why the centres indicated by the noble Lord will not qualify for consideration out of the £10 million?
Baroness Trumpington: Because, my Lords, it is for local authorities to decide how they fund the centres which have outlived the three-year initial grant. If the noble Lord likes to see it, I have a great list of regional centres which have been set up, which I shall be very happy to let him have afterwards.
Lord Ennals: My Lords, does the noble Baroness not realise that this is a most serious problem? She is saying to her noble friend that at this time—
Noble Lords: Question!
Lord Ennals: Is the noble Baroness not saying to her noble friend that at this time, on one of the central social issues challenging us, it is possible that a centre for treatment and rehabilitation may be closed? Surely the Government must look at that again.
Baroness Trumpington: My Lords, I think I have already answered that question, but I would also say that prevention is better than cure. We are tackling the problem on many different fronts. Expensive resources are going into treatment and rehabilitation. We have already taken the exceptional step of making an additional £10 million available for pump-priming of local services. 11 is for the statutory authorities and for the voluntary and private sectors to decide locally what services are needed.
Lord Cledwyn of Penrhos: My Lords, the noble Baroness has given us a good deal of helpful information, as she always does, but in view of the exchanges in the House and the disquiet demonstrated in all parts of it, will she be good enough to look at the matter again and talk to her right honourable friend? It seems quite clear from the questions and the answers that the substance of the Question of the noble Lord, Lord Rodney, is that well established drug rehabilitation centres are being closed and that others without a created reputation are being opened. Should not the matter be looked at very carefully by her department?
Baroness Trumpington: My Lords, I am unaware of any centres that have been closed. I should like to add to what I said about Still Waters and stress that the department is actively considering the application.
Lord Ferrier: My Lords, am I right in saying that this problem is being tackled by the Secretary of State for Scotland energetically?
Baroness Trumpington: I do not know, my Lords.

Unemployed Adults
2.55 p.m.
Lord Dean of Beswick Lord Dean of Beswick had given notice of his intention to ask the following Question:
To ask Her Majesty's Government whether they are considering the introduction of any further measures to reduce the number of adult unemployed.
The noble Lord said: My Lords, in view of the fact, as I understand it, that later today a statement is to be made which will deal with the subject matter of this Question, I seek the leave of the House not to proceed with it.

Business
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Young of Graffham will, with the leave of the House, repeat a Statement that is to be made in another place on education and training for young people.
With the leave of the House, I should like to say a brief word about the length of speeches in this afternoon's debate standing in the name of the noble Lord, Lord Barnett, to which your Lordships have agreed to apply a five-hour time limit. On the principle that the mover is allowed approximately 20 minutes and that the Minister should rise to reply not less than 25 minutes before the scheduled end of the debate, other speakers in the debate should limit their speeches to a maximum of 13 minutes. If any noble Lord were to speak at greater length, he would do so at the expense of later speakers in the debate.

King's College London Bill [H.L.]
2.57 p.m.
Read a third time, and passed, and send to the Commons.

Budget Proposals and Unemployment
2.58 p.m.
Lord Barnett Lord Barnett rose to call attention to the Budget and its consequences for future levels of unemployment; and to move for Papers.
The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper.
It is customary when replying to a Chancellor's Budget to say what a marvellous delivery there was of the Budget speech, congratulate him generally, and then proceed to attack every word in it. I praise the Chancellor's delivery and I do not propose to attack every word in it. There are at least a few in it with which I agree, but there is much with which I do not agree; namely, what was not in it. It seems to me that at a time when unemployment is in the region of 4 million, to have a Budget with a net tax reduction of some £750 million out of a total gross domestic product or national income of £354 billion, frankly, is something about which we should all be extremely concerned. By the very nature of things, with that tiny bit of relief, it cannot do anything in economic terms to reduce the level of unemployment in this country. I

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believe that it is a non-Budget, a tinkering Budget which gave less in relief than the Chancellor and the Government have already taken away during the course of the last year and the years prior to that.
I should like to give a few examples. The Treasury supplement to the National Insurance Fund in 1984–85 was reduced by £416 million, which will effectively mean in due course that there will have to be greater increases in national insurance contributions for employers and employees than would otherwise have been the case. Perhaps I may refer to rates, a subject about which I gather the Prime Minister is concerned. The rate support grant has been gradually reduced to local authorities consistently ever since this Government took office. In the last year of 1985–86 over 1984–85 there was a further reduction of £144 million. Then there was a tax through increases in prescription charges and dental charges which will raise some £74 million. On top of all that, gas, electricity, post office charges and water charges have been increased not because the increases were required by the industries concerned but because the Chancellor of the Exchequer thought it was the best way in which he could increase taxes and have a negative growth in public expenditure.
For example, in recent years there has been £2 billion taken in gas levy. Sir Terence Beckett, not the most notable supporter of those who criticise the Government, has estimated that water charges alone this year will cost industry £100 million. That is not counting what it would cost the consumer. Therefore, all in all, the charges and changes in benefit that the Chancellor and the Government have taken out in the past 12 months clearly indicate that what the Chancellor has done in the Budget is tiny by comparison.
I have never argued that it is possible to run an economy the size of ours with one Budget a year, and then a budget which deals with the revenue side only. Of course that cannot be done. That is why I was always somewhat sceptical of the criticism that we used to receive about the number of budgets during the course of a year. Given the Budget that we have just seen, it might be helpful if we had a few more in order to be able to do something.
I am bound to say to the Government that, as I have indicated, £750 million out of a total GDP of £354 billion, with present levels of unemployment, is quite frankly an abdication of responsibility. I should make it clear to your Lordships that I welcome a number of matters in the Budget. Particularly, I welcome the changes in the national insurance contributions. I believe they will be of some help. But I do not think we should exaggerate the help. I believe that at best the help will be on the margin. The idea that employers will take on thousands of additional workers, whether part-time workers or young people, when the cost of that young person or part-timer will be reduced from £55 per week to say £52 per week, frankly fails to understand the attitude of employers who, quite understandably, will take on extra staff only when they see increased demand for their product or service and not because there is £3 a week less in the total cost of the wage that may be paid.
The basic emotion that I have about this Budget is one of sadness. That is on two counts. The first is this.
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Last year the Chancellor showed himself to be a radical, tax-reforming Chancellor, though I did not agree with everything in that Budget. But that radical, tax-reforming Chancellor has now vanished without trace. All we can see in his place is a man dressed in Green Papers, or at least Green Papers to come. We are to have more Green Papers and more White Papers. I gather that there is to be a White Paper published today. We had one recently that was perhaps best summed-up for your Lordships by a national newspaper not noted for its support for the Labour Party. I refer to the Financial Times. It might be interesting for the noble Lord the Minister who is winding-up tonight to compare this comment on the last White Paper last week, with the one that is being issued today. This is what the Financial Times said on 29th March:
"White Papers which are in effect sermons come oddly from a government which proclaims its faith in market forces. In the event, the White Paper fails to measure up as a persuasive exercise, for it is not at all clear what its readers are supposed to do about it. It will no doubt be very useful as a handbook for Conservative speakers during the Easter recess, but it seems unlikely to achieve much more".
I hope today's White Paper will do a little more than that. I am sure we shall hear from the noble Lord. He might even receive a more complimentary comment from the Financial Times.
In practice, what the Chancellor—this once radical, tax-reforming Chancellor—has done is to be effectively reduced to issuing Green Papers and White Papers, and any further reform has quite clearly been killed off by an unnecessary fear for sterling against the dollar. Above all, sensible ideas on fiscal neutrality have been killed off by the Prime Minister and a group of scared Back-Benchers. Once mortgages and pension funds become untouchable, there really is nothing left for a tax-reforming Chancellor; especially when, quite gratuitously, even on VAT we had the quite remarkable commitment never to touch it at all throughout the length and breadth of this Parliament. Therefore, fiscal neutrality is dead and buried, and, I suspect, the present Chancellor along with it.
My other main cause for sadness is that there is nothing left of the Chancellor's policies but a continuation of what he calls his supply side strategy. That is a strategy that has steadily increased unemployment to what effectively is 4 million after six long, weary years. One is bound to recall that last year's Budget was also a budget for jobs, and a year later unemployment is 136,000 higher. That is the situation.
As for the overall Budget strategy, it depressingly insists on the importance of the public sector borrowing requirement as a measure of fiscal purity, and vital to prevent a slide in the exchange rate, a surge of inflation and excessively high interest rates. This, despite the obvious fact that the level of the borrowing requirement is clearly seen not of itself to be a major factor in any of those three areas. First, the exchange rate of sterling against the dollar clearly has nothing to do with the public sector borrowing requirement. I agree with the Government and with the Prime Minister. It is not the weakness of the pound against the dollar for which one should criticise the Government. It is not their fault. The Prime Minister was absolutely right. It is entirely due to the irrational

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strength of the dollar. Recent changes have more to do with events in the United States than with the Chancellor's Budget. How much better it would have been if the Chancellor and the Government had sought co-operation to avoid the wild fluctuations we are seeing that do so much damage to trade and jobs.
Equally, inflation has remained around 5 per cent. I believe that the Government are right when they say it is likely to stay around that level. I give the Government full credit for that. But that is despite a 50 per cent. increase in the public sector borrowing requirement over the figure of £7 billion that the Chancellor forecast in last year's Budget. In other words, it went to £10.5 billion. Despite that, we have inflation around the 5 per cent. level, so it was nothing whatsoever to do with the public sector borrowing requirement.
That applies equally to interest rates. They are at the present level not because of the £10·5 billion borrowing requirement; they are at that level because the Chancellor puts as his highest priority—wrongly in my view—protecting the pound against the dollar, when, as has been clearly stated and is clearly indicated, it has nothing to do with the weakness of the pound. Therefore the Chancellor is ignoring the reality of the situation and has once again gone for a very tight public sector borrowing requirement in 1985–86, a borrowing requirement of £7 billion or 2 per cent. of GDP.
If your Lordships read the Chancellor's Budget Statement very carefully, as I have tried to do, the only case he has made for that is that this is not the year to increase the borrowing requirement—not because it would conflict with his medium-term financial strategy but because this is not the year. However, with unemployment at these levels, this is precisely the year when he should have been increasing it. Even so, he has arrived at a £7 billion borrowing requirement (if I may say so, with a little knowledge of the situation) by some dubious accounting. As your Lordships will know, I, having done a little, am always suspicious of creative accounting. However, certainly a fair amount has gone into this year's figure. I am suspicious when a Chancellor arrives at the figure he first thought of by, as I say, somewhat dubious means.
There are one or two assumptions to which I should like to refer. There are many others, but the assumption within the Financial Statement and Budget Report on the central issue of the exchange rate and North Sea oil is that it will remain at the level it was in January and February. We already know that it is not at that level. Indeed, we do not know and, in fairness to the Chancellor, he does not know, and nobody knows, what it will be during the course of this coming year. I should, however, be grateful if the noble Earl, when he replies, would tell us what will be the effective change in the borrowing requirement if it stays at its present level. Equally, the Chancellor, somewhat unusually at this time of the year, has increased the contingency reserve from £3 billion to £5 billion. I used to have trouble with my colleagues in the Cabinet if I tried to get it to £2 billion. They thought that I was hiding something up my sleeve. I can only say that I hope that the present Cabinet Ministers will make sure that they at least spend the £5 billion. It is most unusual for me—I appreciate the
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noble Earl's muttered comment—but I hope they will, because without it, if they only spend £3 billion of the contingency reserve, then the borrowing requirement for the coming year 1985–86 will he as low as £5 billion.
It seems to me that we really need a new definition of the borrowing requirement. As I say, it was bad enough when I juggled it. It is now crazy. Now that we have this whole series of privatisation measures, if something is added to the expenditure of a company a day before it is privatised—say £1 billion—that is added to the public sector borrowing requirement. If it is done the day after the company is privatised, it is counted as a new asset. There is something a bit nonsensical about that in economic terms. I hope that the Government will look at it again.
I should have hoped that there was something to be learnt from all our past mistakes. Certainly, one lesson must surely be learnt—that a higher PSBR will not of itself affect the exchange rate or inflation. In particular, it will not affect the interest rates, although I hasten to add that I should he the first to concede that one cannot have an unlimited level of borrowing requirement. But, certainly, at the current time, to have one that is £3 billion more—that is, the same as it was in 1984–85—would not be out of the way. Quite apart from the reasons I have given for a higher borrowing requirement in current circumstances, one needs only to glance at previous evidence in the United Kingdom and other countries. In the United Kingdom, for example, in 1976—a somewhat difficult year: "the year of the IMF," as it is called—we had a deficit of 4.9 per cent. of GDP. The interest rates at the end of the year were 14.25 per cent. But at the end of 1979, more than six months after the present Government came to office, they were 17 per cent. and the deficit was only 3.2 per cent. I hope therefore that the noble Earl will not say that adding another £3 billion to the borrowing requirement will, in current circumstances, mean that we shall have to have higher interest charges.
That there is an alternative has been stressed by many people of all parties. It must clearly be obvious now to the Government. They could have used the £2 billion that the Chancellor—I hesitate to use an adjective—has added to the contingency reserve and could have specifically spent it along with another £3 billion on manufacturing investment and on the infrastructure that would have fed straight through into private industry. And the Government would still have the same nominal PSBR as they had last year. Actually, at this late stage, it is probable that it would have been possible to spend the whole £5 billion. Even if it had been spent, I call it a nominal PSBR as, even on present accountancy methods, a substantial part of that extra £5 billion would come back in higher tax and national insurance contributions and revenue, and a reduction in unemployment benefit and social security.
Of course, I accept that if much of the £5 billion simply went into higher pay it would increase inflation and there would be fewer jobs. I do not dispute that. But that surely strengthens the case for seeking the co-operation of the trade union movement rather than the present state of almost permanent conflict between the Government and the most moderate of trade unions. I do not pretend that this additional

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expenditure offers magical solutions for reducing the tragically high levels of unemployment. It seems to me that it would be better if all of us stopped misleading the unemployed and those who, sadly, are going to be made unemployed. There are many factors such as the new technology and still too many industries that are overmanned that are bound to make the task of cutting unemployment difficult for any Government. However, that being said, the social consequences of these levels of unemployment are too serious to say that there is no alternative.
As I have indicated, there are ways to help to start to bring the levels down. The United States has shown how it can be done, how it is possible to bring down these sadly too high levels of unemployment. I believe therefore that this Chancellor deserves to be condemned because his policies have condemned some 4 million of our fellow citizens to be unemployed. But the Chancellor—
Lord Harmar-Nicholls: My Lords, may I ask—
Lord Barnett: —particularly deserves to be condemned because he has, I regret to say—I very much regret to say—planned a Budget that will leave 4 million if not more, unemployed a year from today. That is why, although not asking all your Lordships to agree to that proposition, I hope that you will agree with what I have had to say. My Lords, I beg to move for Papers.
3.16 p.m.
The Chancellor of the Duchy of Lancaster and Minister for the Arts (The Earl of Gowrie): My Lords, it is indeed ironic that this House, which has no role in financial legislation, can debate the Budget on television while another place, the source of all supply, cannot. I was an initial sceptic but, to my mind, this alone vindicates the long struggle of my noble friend Lord Whitelaw to pilot the televising of Parliament.
I congratulate the noble Lord, Lord Barnett, on initiating the debate in his usual good humoured way. I am looking forward very much to the maiden speech of the noble Lord, Lord Murray of Epping Forest. When I went as a maiden Minister to the Department of Employment, I was something of a culture shock to the noble Lord, Lord Murray. He made me feel most welcome and I have been enduringly grateful to him.
I am sometimes asked what on earth are my qualifications for talking on economic affairs in your Lordships' House. The answer is very simple. I shadowed Mr. Denis Healey, as he still is, and Mr. Joel Barnett, as he then was, when they were at the Treasury during the last Labour Government. They were my mentors and the things that they did and the things that happened to them were my lessons. They did wise things that worked; and they did foolish things that did not work. If I care about money targets, or what is loosely called monetarism, it is because the Healey-Barnett partnership demonstrated the connection between money targets and such humanly and politically rather more attractive matters as greater output and investment and new jobs.
This Budget, the present Chancellor's Budget, has, as part of its strategy, the reduction of public
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borrowing swollen by the miners' dispute. The noble Lord is indeed right in saying that it is rather a small Budget. Without that dispute, we could have done much more. And now, without that dispute, we will do much more. It is part of the Government's intention:
"to reduce the share of resources taken by public expenditure. It is also part of this strategy to reduce the public sector borrowing requirement so as to establish monetary conditions which will help the growth in output and the control of inflation".
Your Lordships will recognise my quotation: it is from Mr. Healey's letter to the IMF in December, 1976. That strategy had a great effect on my party in opposition. It was producing real dividends for this economy. But, unfortunately, as North Sea oil came on stream the Labour Party abandoned it. The nation's overdraft soared and inflation took off again as the Government tried to spend their way out of a rising unemployment that was no more resistible than the tide. Tremendous nonsense is sometimes talked about the breakdown of consensus politics over modern economic management. My noble friend, Lord Alport, I am sorry to say, sometimes errs in this direction, and so, I suspect, on previous form, does the noble Viscount, Lord Chandos.
However, everyone with experience of government in today's post-OPEC world—socialist France or conservative Germany—knows perfectly well that you cannot borrow your way into prosperity any more. The United States is the great exception. But the United States is not the United Kingdom. The dollar is the world's major trading and reserve currency. The idea that people all over the world are going to fall over themselves to lend Britain money if only we increase our overdraft does not bear scrutiny. In my view—and this is shared by the American equivalent of the Governor of the Bank of England—the world will not indefinitely underwrite the United States either. I am not saying that there are no lessons to be learned from the United States. The United States has the much more flexible labour market that my noble friend Lord Young is toiling to achieve here, and the rates of pay in the United States are much more closely related to performance than to union bargaining power. That helps jobs in a way which Mr. Kinnock cannot seem to understand.
This Budget builds steadily and sensibly on every other Budget since the Government came into office. We did indeed reduce our overdraft in this Budget; interest rates have come down, and that trend should continue. Our strategy builds on the Healey-Barnett strategy before they lost both their nerve and their office. The strategy is nothing to do with dogma, only with the observation of positive results: the observation of what the strategy has achieved so far.
All the economic evidence of the past four years and all the economic indicators of the next two or three years are in favour of what—copying Mr. Healey—we call the medium-term financial strategy. All, that is to say, except one. That exceptional piece of evidence is the number of registered unemployed. Our case is that that problem—the greatest headache and heartache of this society and of governments all over Europe—needs to be tackled in an exceptional way. Pumping more money into an already buoyant economy will not solve it. Borrowing more money for an already massive programme of capital projects like

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roads or infrastructural improvements, will not solve it. Using the power of the state to control wages across the economy will not solve it. We have had the lessons of three Wilson Governments, one Heath Government and one Callaghan Government to teach us that. Yet that is what the noble Lord, Lord Barnett, wants us to do and what his right honourable friend Mr. Hattersley wants us to do, only they cannot quite yet come out of their pay policy closet. That is what Mr. Steel wants to do, only he cannot get Dr. Owen to come out of his closet.
In my judgment the great national and international problem of unemployment has only two chances of real improvement. One is to continue with policies, admittedly flexible ones, that bring growth to this economy, that make us steadily and sustainably better off every year. The other is to try to clear away the obstacles to employment, by which I mean the things which discourage employers from employing people and the unemployed from taking work. This Budget does both.
Let us look at the record, at the facts which the noble Lord, Lord Barnett, has not challenged in his speech and which every speaker in this debate must in my judgment successfully challenge if they are to sustain a different case. The year 1984 was predominantly the year of the dispute with the NUM. Yet even that tragic own-goal failed to disrupt very seriously the continued recovery during last year. Our national firm grew by 2.5 per cent. in real terms—that is, after inflation. The manufacturing sector experienced its fastest growth since 1973 when our world changed irrevocably. Non-oil exports grew by 9 per cent. Inflation remained firmly under control. My Lords, 1984 was a bad year. If we can perform like that with Mr. Scargill, think what we can do without him! In 1985 we shall do substantially better. The Treasury forecasters expect the economy to grow by 3·5 per cent. A more recent CBI forecast suggests that they are being much too cautious and puts the figure at 4 per cent. Whichever is right, this summer will see us enter our fifth consecutive year of growth, of getting steadily better off as a nation.
This improvement has already delivered new jobs to the economy. It will, so long as we do not scupper it, deliver more. The Opposition parties, led by Mr. Kinnock but supported by those like the noble Lord who know a great deal better, choose to ignore the rise in employment. Between the election and September of last year alone, nearly half a million extra jobs were created at a time when employment was contracting in most of our major European competitor countries. This increase shows that the Government's strategy is a successful strategy for jobs as well as for growth.
Too many people conveniently overlook a very special and curious fact about Britain. With 65 per cent. of those of working age in jobs, Britain has one of the largest workforces relative to population in the developed world. We are only one percentage point behind the Americans and we are well ahead of France and Germany. The fact that in common with other European countries we still have far too many people out of work, does not argue that a strategy providing both growth and jobs is wrong. It argues that we must strengthen it and do it better. The Budget does both. It strengthens the recovery with radical and constructive
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tax and national insurance proposals.
There is the substantial real increase in income tax allowances and the re-casting of national insurance contributions for those on low wages. This will create many new jobs for those who most need them, and I notice that the London Business School has estimated that it could be more than 150,000. As the noble Lord, Lord Barnett, wrote of the 1978 Budget in his admirable book:
"Wanting to make the biggest impression on the lower end of the income scale, we looked at the threshold at which tax started to be paid".
Our Chancellor has done rather more than look.
Then there is a variety of proposals to simplify business life, remove obstacles to enterprise and stimulate innovation. Development land tax is going completely. Capital gains tax is simplified and lightened. Fifteen stamp duties are abolished, nearly halving the number of documents needing stamping. The Business Expansion Scheme is now to cover R & D companies and exclude property. The national insurance contributions from over 1.5 million self-employed people—and I am very glad to say that that number, which is most important, is increasing rapidly—are lightened and put on an equitable basis at last. There is a major stimulus to more profit-sharing schemes.
Then there are the measures which supplement the strategy and which tackle unemployment directly. I am short of time but these matters will be covered in detail by my noble friend Lord Young both when he repeats a Statement later this afternoon and when he comes to wind up. The successful YTS is to be expanded to give youngsters two years' intensive training instead of one year as at present. The community programme for the long-term unemployed is to be nearly doubled with 100,000 extra places. Together with the clearing away of obstacles to employers taking people on—and this is very important and no less acute as a problem in this economy—these aspects of the Budget attack the promblem of unemployment among the young and unskilled of our country, where it is most acute.
If I dare say so, wearing another hat as Minister for the Arts, perhaps we make too much of individual Budgets as if they were cultural events—and talking of culture by the way, thank you, Nigel, for no VAT on books, for doubling tax Convenants and for the heritage land provisions. This Budget is a single step in our sustained and proven progress towards steady growth and new jobs. It is part of a general strategy for training, innovation, technology, competition and restoring this country's ability to hold and win markets. Customers, after all, are what employment is all about. The problems we are tackling are familiar, as the noble Lord, Lord Barnett very fairly acknowledged. They were indentified and discussed in White Papers 20 or 30 years ago; by the noble Earl, Lord Stockton and Mr. Maudling and the NEDC; and by Lord George-Brown's National Plan as well as by the Heath, Wilson and Callaghan Governments. Throughout those long years we all did pitifully little to solve them.
It has taken this Government to act. We do not claim to have all the answers, or to be able to shift the country from its bad post-war habits in a short time,

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though I must say that I am amazed at the speed with which Britain has moved recently. Look at today's settlements on the industrial front. We are trying with all our might and main to bring our economy up to date in education, training, innovation and enterprise. This is a venture that all noble Lords will support in their hearts and I think it is fair to ask them for support in their words as well.
3.32 p.m.
Viscount Chandos: My Lords, your Lordships' House should be grateful to the noble Lord, Lord Barnett, for introducing the debate this afternoon on the effects of the Government's recent Budget. Since, as the noble Earl, Lord Gowrie, has just mentioned, normally your Lordships' House does not get a chance to debate the Budget until the end of the summer, when already the thoughts of outside commentators are turning to next year's Budget rather than the effect of this year's, I am particularly grateful to the noble Lord, Lord Barnett, for giving us the chance to discuss this subject even before the House rises for the Easter Recess.
I, too, very much look forward to hearing the maiden speech of the noble Lord, Lord Murray, since the contribution he has made to the country throughout my working life has been outstanding—not always, perhaps, with the support of all of his colleagues within the Labour movement. We should also be grateful to the noble Earl, Lord Gowrie, for once more putting his head in the jaws of the lion and setting out to explain and justify the Government's economic policy to your Lordships' House. Perhaps I, in turn, am about to put my head once more back in his jaws. Finally, perhaps we should be grateful to the Chancellor of the Exchequer for his unusually short Budget speech in another place last month, thereby allowing its contents to be more easily discussed in the debate today, limited as it is to a duration of five hours.
None of your Lordships, I am sure, would necessarily equate length with virtue—short and small is beautiful, perhaps—but I believe that your Lordships and Members of another place last month are probably the only people who should be grateful for the brevity of the Chancellor's Budget as it displayed, perhaps not surprisingly, a complacency about the prospects for long-term economic growth and increased unemployment which is matched by a pudding-like inertia in terms of introducing measures to expand and strengthen the economy. In the short term, the Government are prepared to regard a modest level of growth in recent years, and a slightly higher one in prospect for this coming year (though starting from a frighteningly depressed level of activity itself induced by the Government's earlier measures), as signs that all is well in the best of all possible worlds, while at the same time the Government skimp and squeeze, cut and hack, at all forms of investment, be it in capital goods or in areas such as education and research.
Early in the Chancellor's speech he summarised the strategy of the Conservative Government since 1979:
"The Government's economic strategy has two key components: a monetary policy designed to bring down inflation and a supply side policy designed to improve the competitive performance of the economy". [Official Report, Commons, 19/3/1985: col. 788.]
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There has been no U-turn in this respect by the Government, since we can re-read the speech of the previous Chancellor of the Exchequer in the Government's first Budget in 1979, when he said:
"The poor performance of the British economy in recent years has not been due to a shortage of demand. We are suffering from a growing series of failures on the supply side of the economy". [Official Report, Commons, 12/6/1979; Col. 240.]
After nearly six years of Conservative government, with their unwavering commitment to improving the supply side of the economy and confident neglect of the demand side, unemployment has trebled and industrial production has remained static. So, rather than devote all my time to commenting on the tinkerings and the fiddlings represented by some of the measures in the Chancellor's self-proclaimed "Budget for jobs", I should like to question again the underlying economic strategy of the Government, upon which the Chancellor has justified the inaction he is proposing.
What exactly is the supply side of the economy, this impressive and technical sounding phrase that the Government have borrowed from America? It is all about freeing-up production, increasing incentives, removing obstacles, imperfections and anti-competitive practices in business and our whole economic life. Perhaps I could put it more graphically. When the Secretary of State for Trade and Industry, Mr. Tebbit, while serving in his earlier position as Secretary of State for Employment, advocated that the unemployed should follow the example of his father in the 1930s, who got on his bike to find work, supply side policies are intended to ensure that nobody chains the elder Mr. Tebbit's bicycle to the railings and throws the key away, or that nobody strews the road to full employment with tin-tacks.
Advocates of supply side economics will argue there is no need to take action to create jobs towards which the elder Mr. Tebbit could bicycle: instead, the freedom to bicycle over the horizon in search of jobs will actually create jobs. As more and more bicyclists cycle in ever-increasing circles, work will be created—at least for bicycle manufacturers and repairers. There are now, out of a total of four million unemployed, 100,000 people in this country who have been bicycling vainly for five years or more in search of a job.
What, then, have the Government done to improve the supply side of the economy in six long years? Have they done a lot? If so, why has industry failed to grow and unemployment rocketed? If the Government have not done very much, what on earth have they been doing behind a subterfuge of busyness and reputed reform? The tax reforms of the last six years have brought some additional motivation for the most highly paid people in the working community, particularly where their pay has been increasingly linked to the profitability and general performance of their business. Entrepreneurial activity is, however, from my experience, remarkably insensitive to the levels of taxation, since the motivation of many entrepreneurs is often to build a business for its own sake, with the creation of personal wealth a secondary objective.
The real level of unemployment and other social security benefits has been held back, as the Govern-

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ment have said so often, to price people back into jobs. The emasculation and even abolition of the wages councils being considered by the Government is another step in the relentless return to Victorian values and Victorian values of labour. Within the context of an economy subject to indefinite slow growth, this prescription may well be the only option. But whether such a dire economic concept is inevitable and need therefore close other options, is a question to which I shall return in discussing the demand side of the economy.
Tax incentives have been introduced to encourage investment in small businesses, to supply the newly-liberated entrepreneurs with the capital to build their companies. I believe an estimated £5½ million was invested last year in fine wine under the EEC, which no doubt has created many new jobs in the United Kingdom. Perhaps it would be churlish as a supporter of the European ideal to ignore the maintenance of employment in the vineyards of Bordeaux. Money has flowed into old cars and into property development, which at least the Chancellor is proposing in this year's Budget to prevent, and even into some businesses which produce goods and new jobs.
Obstacles and inefficiencies have been removed by the Government but many more have been left and some new ones introduced. The changes to national insurance charges introduced by the Chancellor represent a helpful measure, and they can only be seen as promoting increased job prospects without asking those seeking them to accept any lower level of wages than already exists. However, we cannot believe that this alone will transform the employment prospects for the currently unemployed. The Chancellor proudly claimed that his measures would reduce the cost of employing a young person by £3 a week at a wage level of just below £90 a week. How many of your Lordships, in running your businesses, would see a £3 a week saving as the critical factor in deciding whether to hire more employees? How would that compare, for instance, with the prospects of a competitive and relatively stable exchange rate to assist you in exporting efforts and in challenging the importers who are taking the home market?
I believe that common sense challenges the exclusive reliance on supply-side economics, whereas action rather than immobility on the demand side of the economy, allied with continuing efforts to improve the supply side, make common sense and economic sense. The Prime Minister has made great appeals to the common sense of this country, and her expositions of economic policy in popular terms are widely seen as a reason for her successes in the past. Since there are rather more noble Baronesses in your Lordships' House than lady Members in the House of Commons, I have quite rightly to be particularly careful about the way I express my criticisms of the Prime Minister's economic policies.
Nobody should despise the economics of the housewife, or of any householder. Nobody should despise a businessman's approach to the financial and general management of his business. There are differences in the macro-economic management of a country's economy compared to the financial management of a business, but there are similarities, too.
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Your Lordships' House includes within it on every side—notably the noble Lord, Lord Barnett—most distinguished and experienced accountants whose professional lives have been devoted to ensuring that companies and other businesses treat the difference between capital expenditure and current expenditure fairly and realistically; but the Government continue not to do this, and this must be changed.
I believe that the policies of this Government in restricting borrowing to the levels that they have chosen are damaging to the prospects of the economy, and I call on the House to show its approval of the Motion put forward by the noble Lord, Lord Barnett.
3.44 p.m.
Lord Murray of Epping Forest: My Lords, it was with a measure of trepidation that I chose to address your Lordships' House for the first time on this issue of employment and unemployment. However, this seems to me to be an issue on which no one can keep silent, even at the risk, which I hope I can avoid, of transgressing against the protocol of occasions such as this, and, indeed, incurring a fate which is too awful to contemplate. I count on the tolerance of your Lordships and, indeed, on your reputation for listening, even if not always agreeing, which has been so impressed on me since I came here a few short weeks ago.
I, too, am grateful to the noble Lord, Lord Barnett, for drawing our attention to a subject which, as he demonstrated in his speech, and as has, indeed, been demonstrated in the matters we have discussed this afternoon at Question Time, is important because of its consequences. This applies whether we are discussing drug abuse, which is not unconnected with the consequences of idleness and unemployment, or whether we are discussing the inadequacy of resources for investment in engineering faculties. As I say, I am grateful to the noble Lord, Lord Barnett.
I am also, up to a point, grateful to the authors of Employment—a Challenge to the Nation. Was it a blue book, a White Paper, or a report? I am certainly grateful to them for the title. The title seemed to me to be quite unexceptionable, a challenge to the nation, with the implication that we can tackle this appalling situation only collectively, together, and not by being separated and confronting each other.
I was disappointed—I hope that I was wrong in my disappointment—at not finding in the report a reference to the work being undertaken by the National Economic Development Council on where the new jobs are to come from. I hope that when the noble Lord, Lord Young, replies he can give us a progress report on that discussion within the NEDC.
My biggest debt to the authors of the White Paper lies in the fact that it drove me back to a paper which it selectively quotes, the 1944 White Paper on Employment Policy. Indeed, it drove me to my bookshelf to take down and re-read at least in part Beveridge's own report of the same year on Full Employment in a Free Society. I make no apology for referring to that outstanding work of analysis and prescription.
I went back to it not in a mood of nostalgia, though there must be many of us who, in those months after

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the war, were excited by the products of Beveridge in that field and by his thinking on the welfare state. As I say, I went to it not in a sense of nostalgia, but to ask myself yet again how it can be that we as a nation—not just the Government, because they have no monopoly of carelessness—find acceptable, find tolerable, the idea of 4 million people being unemployed.
The Chancellor told us in his speech that the present level of unemployment was unacceptable. It would be churlish not to welcome any signs of penitence from the Front Bench. It is progress, as it were, from the Front Bench to the penitents' bench, because it is not so long since we appeared to be hearing statements about inevitability and even necessity. Therefore I welcome the statement by the Chancellor that the present level of unemployment is, and must be, unacceptable to all of us.
I look forward to the noble Lord, Lord Young of Graffham, explaining to the House in perhaps a little more detail what the Government mean by saying that it is unacceptable. Perhaps he will also indicate to us what would be an acceptable level of unemployment and will tell the House, as my noble friend Lord Barnett suggested the Government should tell us, what they think the level of unemployment will be in 12 months' time and say whether it will be lower than it is now.
I put these questions to the noble Lord, Lord Young of Graffham, with much confidence because of the great skill he showed when chairman of the Manpower Services Commission in clarifying the most obscure of problems and in forecasting trends in employment. I am glad to pay tribute today to the noble Lord for what he did in his previous incarnation in the MSC, and to Sir Richard O'Brien, his predecessor, for the distinguished contribution which he made, and for the drive which virtually brought together employers, trade unionists, and civil servants to help shape and fashion a better system of using the nation's manpower. I believe that the Manpower Services Commission is by far and away the most important institution established in the field of industrial relations since the end of the war. It is inordinately better than the multifarious attempts which have been made at wage restraint and incomes policy. I profoundly believe that it is in finding better ways of using our manpower, in better and more extensive systems of training that we shall solve the problems of competitiveness and unit labour costs which no doubt, and properly, will run like a thread through the debate this afternoon.
It is right on occasion that we should ask the nation to restrict its income. It was right in 1975; and too many people forget that as a result of national determination, led by the trade union movement between 1975 and 1978, raging inflation of 25 per cent. or more was reduced to 8 per cent. by the middle of 1978. I am not portraying a vision of perfection, but do not let us forget the results of working together in those days.
Now again wages are at the centre of Government strategy not only to restrain increases but to cut real wages, and to cut them most deeply where they are lowest, in the public services and among the employees of industries which are subject to the wages councils. In the inflationary circumstances of 1975 it
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was right to ask for collective restraint. In the deflationary situation of 1985—if it is not deflationary, how do we account for 4 million people unemployed—it is not right to seek to cut into real incomes in that way? I believe it is right for the TUC to resist this. Far from affecting employment in the industries concerned, the wages councils have in the main affected trade union membership. I have heard trade unionists argue that the wages councils should be abolished so as to expose employers and employees to the chill winds of pressure. I am glad that the TUC has always resisted that argument. It has always asserted the need for legislation, even at the expense of trade union membership, to protect the weak. I look to the Government to take an equally broad view of their responsibilities and obligations. They have an obligation to take powers in order genuinely to demonstrate the unacceptability of the present level of unemployment by means of measures to reduce it and they have a duty to protect the weakest groups in our society.
Perhaps I may conclude with a final reference to the Beveridge Report. In reading Beveridge's report on fuller employment in a free society I chanced upon a quotation from Charlotte Brontë's Shirley about the lack of employment when a workman is talking to an employer. The workman says:
"Them that governs mun find a way to help us. Ye'll say that's hard to do. So much louder mun we shout then, for so much slacker will t'Parliamen men be to set on a tough job".
Of course it is a tough job. Of course, as the noble Earl, Lord Gowrie, has said, there are no magic wands; we know that. Of course all of us collectively must seek to solve the problems for which in all our own ways we are responsible. But I believe that the nation referred to in the White Paper's title is in its turn not only being challenged but is challenging the Parliament men and women, the Parliament men and women of this House, to remind the Government of their proper and inescapable responsibilities.
3.55 p.m.
Viscount Watkinson: My Lords, I should like first warmly to congratulate the noble Lord, Lord Murray, on his speech. I am sure that all noble Lords will agree that it is a great benefit to your Lordships' House to hear someone with the unique experience of Lord Murray in industrial affairs. I hope that we shall often hear him again. I hope he will forgive me if I add as a personal note that over many years I have seen the noble Lord in his previous avocation and I never doubted that he was doing the best that he could for the nation in his own inimitable way. I hope that we shall often hear him again.
I support the Budget approach and I have one short point to make about the noble Lord, Lord Barnett, who I thought drew away from the Budget in its right context. After all, with a dollar going haywire and a pound subject to being kicked around by every currency speculator in the world, the Budget just had to be internationally acceptable. The fact that it was is shown in the level of the pound today and what all businessmen hope is that that level can be stable. What we want is not a kind of yo-yo but a stable value for the pound, and I think the Budget has made a considerable contribution. It was right that it should do so.

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I want to turn to the point made by the noble Lord, Lord Murray, and I accept entirely his point that 4 million unemployed is not a matter that any of us can look on with any kind of disregard: it must be viewed with the utmost concern. It would be a very cruel deception to fudge the facts. I am sure that when the noble Lord, Lord Murray, addresses us again, as I hope he often will, he will not do this. This is no sudden storm. Nearly 10 years ago when I was president of the CBI it was obvious that if the nation did not mend its ways—I am not talking about political ways—we should have 3 million-plus unemployed. We said so at the time but nobody wanted to listen.
The 10-year causation of this grave problem means that one really must not try to imagine that it can be reversed by some sudden stroke of policy. It has taken a long time, a sadly long time, to happen. We have to face the fact that it may take a long time to get it under control. The main cause is still (and there is no other cause) that not enough customers are willing to buy British at home or abroad. That is the cause of unemployment; there is no other and there is no palliative. These emergency Government measures—the spending of £5 billion or any other sum that we hear so much about—are honestly meant, but I do not think they will cure the real problems of unemployment over the long term. Only selling more goods will do that. There is no other solution. The fact that we might run the risk of turning inflation the wrong way, we might spend money which we are not earning in finding some sort of temporary palliative, means that the Chancellor should resist and resist strongly, as he so far has done.
I think that the Budget correctly did what it could to adjust tax to help jobs. It will help, but I think that any honest man would ask how much it will help. Who knows? I must say this, particularly in your Lordships' House, where one can speak frankly: that again it depends on industry, it depends on managers and workers how they make the most of what the Chancellor has provided in the economic circumstances, which, I agree, are improving.
But another warning, if I may. The CBI have just announced yet again some reasonably good figures, although within them is the fact that 25 per cent. of companies in this country are still seriously underloaded for orders. But they are good figures. My noble friend Lord Gowrie, who has already spoken in the debate for the Government, has said that we look to a good year, with no miners' strike and, hopefully, no other major industrial troubles. I think that he is right. But we are still not competitive enough. The noble Lord, Lord Murray, knows this, and I support him entirely in what he has said about the NEDC. If you delve into the fairly impartial researches of that body you will find figures about our international competitiveness which ought to frighten all of us. If the Japanese are worried about the competition from South Korea, what should we be?
We still pay ourselves too much for doing too little; and although the industrial news this week is good—and I think it is splendid that it looks as though there will be a settlement on the railways and as
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though sense is being talked in the Post Office dispute—nonetheless we really cannot afford the kind of terrible, wasteful battle that we have had over this last year in the mining industry. We must see that joint consultation takes place before we have a strike, and then, if it is proper consultation, we will not have a strike.
If one looks at the nation as impartially as one can and from the standpoint of industry, there are many sectors in which we are still in severe industrial decline. If that decline is not arrested, then we shall have more unemployment and not less. In my view, in that sort of circumstance the Budget could do no more than to set the right frame and be consistent; and I think it did this. I think that now it is up to industry to make the most of the situation in which it finds itself, and it is up to the trade unions to try to work reasonably together. Of course, there has to be argument, but I hope that in the months to come, particularly now that the economy is beginning to expand again, if there is a chance to get more exports the trade unions will at least see that their people sit down with the employers around a table and try to hammer something out rather than have wasteful strikes which are only of value to our competitors. They are of no value to us.
There is one point on which I would follow the noble Lord, Lord Barnett. It is rather a hobbyhorse of mine, and whether the noble Lord, Lord Young, will be able to say anything about it at the end of the debate I know not. But, really, if we have an innovative Chancellor, could he not look at our Budget system, which is really geared to Mr. Gladstone? It is not geared to modern life at all. I suspect very strongly that if I had run any business with which I was connected in the way that our budgetary affairs are managed, the shareholders would have been after me, and rightly so—even, perhaps a prosecution for negligence; I do not know.
I think it is really absurd that we cannot, in Her Majesty's Treasury, differentiate between revenue and capital. Every business has to do this. I understand the problem. I understand that the Treasury is accountable, and that they cannot lose control of expenditure. That is right, and any Chancellor must see to it. But in regard to infrastructure so many things could be done in, for example, a Severn barrage scheme, which could take quite a lot of load off the electricity industry, in drainage, in housing, in so many things. If the economy begins to improve, in my view it would not be improper to consider some way of improving an infrastructure which in many cases is 50 years out of date and the capital spending could rightly be spread over a large number of years and not be subject to the Treasury's annual accounting.
We have some of the most brilliant brains in this country in the official Treasury and, no doubt, in the other "Government treasury" as well. There is an enormous capacity in the Treasury for thinking, examining and innovating. I hope that they will really see whether the Budget frame is right, whether the magic of the PSBR is entirely sensible, and whether, on the basis of a sound Budget, which I believe this one is, there is not a way, without necessarily spending within the Budget, of finding necessary capital works outside it that could help unemployment—though

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that is perhaps not the main reason—and could bring our country up to date again in many areas of its structure where that is sadly needed.

Employment and Training
4.4. p.m.
The Minister without Portfolio (Lord Young of Graffham): My Lords, with the leave of the House, I shall now repeat a Statement which is being made in another place by my right honourable friend the Secretary of State for Employment. The Statement is as follows:
"With permission, Mr. Speaker, I wish to make a Statement on employment and training.
"Last Thursday I published the White Paper Employment— The Challenge for the Nation. Today, in conjunction with my right honourable friends the Secretary of State for Education and Science and the Minister without Portfolio, I am publishing a further White Paper, entitled Education and Training for Young People.
"The purpose of the first White Paper is to set out the facts and figures on the present employment situation; and to describe the strategy that the Government believe offers the best prospects for employment, with the steps already taken and the further measures proposed.
"There are three key elements in the Government's strategy towards employment. First, the Government must create an economic, financial and industrial climate in which enterprise can flourish. The priority is to control inflation. Without that there is no prospect that industry and commerce will compete successfully, raise output and create jobs. Secondly, the Government can help improve the labour market by encouraging more and better training, and by removing obstacles which hamper employers taking on workers. Finally, the Government can provide direct help for those worst affected by unemployment through, for example, the Community Programme.
"The second White Paper, Education and Training for Young People, deals with a key element in our strategy for employment—the reform of our education and training policies and programmes. It outlines our approach to work-related education and training for 14- to 18-year olds, and emphasises the need to develop more comprehensive and coherent provision for this age group.
"Improvements in education and training are crucial to strengthening the economy. Only then will industry and commerce be able to find skills they need if they are to become more competitive. Efforts to get a better trained workforce must be directed at everyone in it, irrespective of age or occupation. But, in particular, we must ensure that our young people are properly prepared for the world of work. We intend to build on the success of recent achievements by taking action in three particular fields: introducing new arrangements for in-service teacher training related to the Technical and Vocational Education Initiative; setting up a view of vocational qualifications; and bringing in a new two-year Youth Training Scheme. These actions flow from
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the review of provision for 14- to 18-year-olds carried out by the Minister without Portfolio.
"As regards the Youth Training Scheme, the Government are providing substantial additional resources so that, from April 1986, we are able to offer a second year of training to 16-year-old school leavers and a one-year place to 17-year-old school leavers. Our aim is that all our young people leaving school will have the chance to get vocational qualifications. The Manpower Services Commission have warmly and unanimously welcomed these proposals and have now put in hand the necessary consultations with a view to reporting back to me by the end of June.
"The new training scheme, together with the parallel changes in education and the review of vocational qualifications, will help to put vocational education and training for our young people on a par with that of our main competitors, and will help create a more flexible labour force and more competitive economy.
"Taken together, these two White Papers set out clearly the Government's strategy for employment and give the details of the new proposals for improving vocational education and training in this country, which I hope will command the support of the whole House".
My Lords, that concludes the Statement.
Lord McCarthy: My Lords, I should like to thank the noble Lord, Lord Young of Graffham, for repeating the Statement. I can tell him, and I could have told the noble Lord, Lord Barnett, had he been here, that we like the second White Paper much more than we like the first White Paper; after all, it actually proposes things. Most of the things, indeed, I would say all of the things, that it proposes we are very much in favour of ourselves. I should like to concentrate, if I may, as did the Statement, on what is suggested in the White Paper for the Youth Training Scheme.
I should just like briefly to ask the noble Lord a number of questions. There is still, as I understand it, nothing in the White Paper—although I have not had very long to read it—to tell us the precise numbers which the Government believe will be covered by the extra year of the YTS. I ask this because there is something unusual, as I see it, about the costs. The costs for the second year are an extra £125 million for 1986–87 and £300 million in 1987–88. For this we appear to be getting an extra year on the programme for something like a third of the cost for the first year of it. That seems very cheap. Therefore, I am interested in how many people he believes will be going through the programme in the first year, how many in the second year, and how that relates to the numbers going through the YTS at the moment.
Secondly, I should like to ask about the contribution of employers because in the Budget Statement, and indeed in the White Paper, it is said that a significant and substantial contribution will be made by employers this time. I understand that and I think it is right because employers, with the second year and with young people from 16 to 17, will be getting better value. Better training, we hope, will be provided and therefore it is reasonable that they should make a

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larger contribution. But there is nothing in the White Paper yet as to what the contribution will be. Can the noble Lord help me on that?
Next, there is nothing about the allowance. Regarding the second year, with training from 16 to 17, or two-year training, say, for someone who goes in at 16 and comes out at 18, is it intended that the same allowance will apply throughout the the two-year period? Or will there be a stepped allowance in which the second year, or the year of entry if it is 16, is significantly higher than the present level of the training allowance? I should have thought that would be reasonable, and that although the Government have never been able to meet the TUC on the kind of figure that they thought reasonable for the first year of the YTS, they might be prepared to go some way regarding the second year of the YTS. I should like to ask him about that.
Finally, as regards the disappearance of the young workers' scheme, why has that disappeared? Why is there nothing in the White Paper? Why was there nothing in the Budget? In terms of money, we were told, it was a great success. We were told that 360,000 people went through it at a very small cost. It is true that we were subsequently told, and indeed the Department of Employment told the Public Accounts Committee, that the overwhelming majority of young workers who went on the young workers' scheme would have got jobs anyway. It is true that we know of many employers who actually split the allowance with their workers. Why have we seen the end of the young workers' scheme if it was such a good scheme? And if indeed it was such a bad scheme, as we always said it was, why cannot the Government say so and can we be sure that nothing like it will be seen again?
Lord Rochester: My Lords, from these Benches I should like to join in thanking the noble Lord, Lord Young of Graffham, for having repeated this Statement. We would congratulate the Government on the success which has attended the Technical and Vocational Education Initiative referred to in the Statement, even though at the time it was introduced we deplored the absence, as we saw it, of adequate consultation before it was actually introduced. In that connection, can the Minister please tell us what consultation, if any, there may as yet have been with the educational authorities about the projected in-service training for teachers?
We very much welcome also the planned expansion in the Youth Training Scheme so that eventually everybody aged under 18 will have the chance of job education or training. That is a policy which the Liberal-Social Democratic Alliance has advocated for a long time. But following in degree what it is that the noble Lord, Lord McCarthy, has already said, will the noble Lord confirm that the fact that there is no reference in this Statement or indeed (so far as I know) in any other of the various White Papers that have been put before us in the past week or so to the payment of supplementary benefit in connection with the Youth Training Scheme, may be taken as an indication that there are no plans for changes in the existing arrangements? For is it not much better to make the scheme so attractive that young people are
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anxious to take part in it rather than to confront them with penalties if they do not?
We are glad—and this, too, is referred to in the Statement—that the Manpower Services Commission have been asked to undertake a comprehensive review of vocational qualifications with the aim of ensuring that there is a system which young people can join at any stage, one that is based on achieving recognised standards rather than time-serving, and one which provides opportunities for progress towards higher skills and is relevant, we hope flexibly, to industrial and commercial needs.
Reference is also made in the Statement to the community development programme. I have one more question to ask the noble Lord, if he will be kind enough to answer it. Depending on the progress that is made in the development of that scheme, which we very much welcome, do the Government have an open mind as to the possibility of increasing the numbers eligible for that programme if the present deplorable increase in long-term unemployment, particularly among young people aged under 25, continues?
Lord Young of Graffham: My Lords, I am grateful to the noble Lord, Lord McCarthy, for his implicit backing for this White Paper. I should like to assure him that the Government have not been entirely prescriptive about the shape of the Youth Training Scheme. Indeed, it is now with the Manpower Services Commission for them to negotiate, with the partners in the commission, the precise shape so that employers, unions and the world of education will have the very last word and it is hoped will come back with a scheme which will be acceptable to all parties and acceptable to the Government; one that will be able to take within it some 200,000 to 350,000 young people for training.
As regards the great change in the new Youth Training Scheme, this is not simply that it is a doubling of the present scheme: it is that the second year is directed towards occupational qualifications, and this marks a substantial step forward. Of course, the young workers' scheme was a great success, but having a great success does not mean that we should be content with it. I hope very much that the new and improved version of the Youth Training Scheme will be better, as of course it does provide training in itself.
I am grateful to the noble Lord, Lord Rochester, for his comments and in particular for his noting of the review of vocational qualifications. In many ways, this is perhaps the most important part of the White Paper since it will by its very nature imply a review of all qualifications—not just for those in apprenticeship but those in all occupations. I hope it will have a beneficial effect, not only on the college system but also on employers and indeed on the school system itself. I believe it will be a considerable step forward.
I hope very much, too, that the Government will find that the community programme will be welcomed by the outside community, and that we shall see the increase. The Government have been particularly generous in increasing the number of places from 130,000 to 230,000. I think it is important to see that these places are filled before we actually consider what happens next.
Lord Molloy: My Lords, would the noble Minister not agree that this last White Paper, as the noble Lord, Lord McCarthy, has said, is an improvement on the previous White Papers, but the grim truth is that White Papers over the past couple of years, and all the legislation that has flowed from them, has not to any great degree made any massive improvement in the situation? Young students with massive ability, on leaving our universities and technical colleges, are on the dole and unemployed because there is no particular industry that can take advantage of the qualities that they have obtained in technical colleges, on training schemes and in universities. Therefore, would he not agree that all of this will be absolutely useless unless we really consider what has to be done in this extraordinarily difficult task? I immediately concede that it is an enormously difficult task, but it will have to be done to make these White Papers worthwhile. The task involves setting about the entire reconstruction of the United Kingdom's industrial base so as to take advantage of the training that the White Paper indicates will be available for young people.
4.15 p.m.
Lord Young of Graffham: My Lords, I am sure that the noble Lord, Lord Molloy, and, indeed, all of your Lordships, will not wish me to anticipate what I shall have to say later in winding-up the debate this afternoon, save to say this. What we are talking about is foundation training for all our young people, and the very first paragraph of the White Paper points out that many people leaving school today will not retire until the second third of the next century. The world that they will then live in is unimaginable to us. We are talking about providing flexible and broad foundation training and the beginning of a national programme of vocational occupation schemes. However, I am grateful to your Lordships for welcoming the Statement.
Lord Boyd-Carpenter: My Lords, I wonder whether my noble friend can clear up the question of the inter-relation of the very interesting proposals which he has just announced and the existing provisions for vocational training for young people. For example, I have in mind the fact that the catering industry already undertakes very substantial training work in respect of young people. How will that be slotted into the new scheme? How, also, does the new scheme relate to recruitment by the armed forces of young people—the young soldiers' type of scheme—which also serves a very useful purpose? How will all these be brought together?
Lord Young of Graffham: My Lords, I thank my noble friend. The precise shape of the new scheme remains to be determined. It will be determined by consultation and agreement between all the parties. I note very much my noble friend's comments about the catering industry. That is already provided for within the existing Youth Training Scheme, and I hope that the new scheme will, indeed, look at all the requirements for catering, which is one of the very real growth areas in our economy today in terms of employment.
Lord Davies of Leek: My Lords, I wish to thank the Minister for the Statement, and I am sure that we are looking forward to a full debate on this subject. Nevertheless, is the noble Lord aware that at least in the history of our people we have come to the end of the smoke stack era? Unemployment is due to the micro-electronic and electronic gadgets that we now have and we can no longer solve the problem of full employment in any of the old Gladstone, Marxist or other ways. We must look at the world through new eyes. Nobody yet knows the answers, but I hope that this will be looked at. As the Christian Science Monitor pointed out the other day, there are 14 million people in Europe looking for jobs. This is the problem of the technological age, which is a mighty challenge to modern man.
Lord Young of Graffham: My Lords, I am grateful to the noble Lord for his comments. One of the points which concerns me is why there should be so many people looking for jobs in Europe, but very few looking for jobs in the United States. It is a conundrum on which I hope I can amplify a little later on. But let me assure your Lordships that, although the smoke stack industries have disappeared, manufacturing will not disappear in this country. It may not be a great employer of people, but there are many other ways to employ people. I hope very much that we shall live through an era in which we see manufacturing rightly restored as a wealth producer for our people.
Lord Harmar-Nicholls: My Lords, is my noble friend aware that the two White Papers and the Statement will be accepted as a sober and constructive attempt to face up to this problem? But in dealing with the more sophisticated ideas that are shown in the White Papers, will my noble friend see to it that we do not overlook the very important point of literacy in its earliest stages? Those of us who tried to operate the young worker schemes, and who did so with some success, found all too often that young people in, for example, the hotel industry, who were bright and keen in every other respect, were not capable of writing down the name of a newspaper or the name of a resident, in order that people could be given service the next day. That sort of elementary illiteracy is something which ought not to be overlooked when we are looking at overcoming some of the bars to getting people into work.
Lord Young of Graffham: My Lords, I am grateful to my noble friend for his comments. This is a matter of some considerable concern to my right honourable friend the Secretary of State for Education and Science and, indeed, it has been pointed out to me on occasion by employers and potential employers up and down the land. It is not a matter with which resources as such are concerned. It is one of those areas where quality is more important than quantity. While I am on my feet, perhaps I may say that I hope that your Lordships will accept my apologies if I have to leave the debate for a few minutes to deal with matters arising out of the White Paper; but I shall return as speedily as I can.

Budget Proposals and Unemployment
4.25 p.m.
Debate resumed.
Lord Bottomley: My Lords, it affords me much pleasure to follow the noble Viscount, Lord Watkinson. We served very happily together in the other place for many years. I should also like to join him in congratulating my noble friend Lord Murray on his maiden speech. We have been friends for many years and I have admired tremendously his knowledge and his integrity. He brings to your Lordships' House a rich experience of industrial relations and am sure that we look forward to hearing from him again and again.
It is distressing to us all that Britain's economy is in a precarious position and that the world outside looks upon us as a weak and ineffective nation. The Government have to accept the major responsibility for this state of affairs. Britain is an industrial nation with few natural resources. Even our newfound asset, oil, will last for only a limited period. Therefore, we have to import the bulk of our raw materials and food from overseas.
The Industrial Revolution enabled us to manufacture goods which could be exchanged for raw materials and food, and we built an empire based on being the greatest trading nation in the world. The old industries making mass-produced goods requiring comparatively low technology and unskilled or semiskilled forces have now been taken over by the developing countries. In the main, new industries have not developed sufficiently to fill the gap.
Of course, two world wars added to our problems. As Sir Winston Churchill said at the end of the last war, we were a bankrupt nation. It was my privilege to be a member of the post-war Labour Government which had to tackle this situation. The ravages of war and the past neglect of our economy had left us in a distressed state. There were troops returning from the battlefields to be resettled and social problems, such as housing, education and health services were vigorously dealt with and, in spite of that, the welfare state came into being. The result was that Britain was highly respected in the world, particularly because of the creation of the new Commonwealth.
However, I must not dwell on the past. It is the present Government and their policies with which we are concerned. I believe that they have deprived and divided the nation, eroded our liberties, wasted our resources, and created a sick economy. Their failure to invest in the public utility services, or to upgrade and increase our housing stock, means that in a few years' time we shall be in tremendous difficulties.
Recently the electricity supply in front of my own house was dug up and I saw for myself the mangled cable worn and decaying. Too often, we hear of gas explosions in homes and in supply areas. One of these recently culminated in many people being killed in South-West London. Our sewage systems are hopelessly out-dated. The Federation of Civil Engineering Contractors have drawn attention to the high rate of sewer collapses. Such neglect could lead one day to widespread disease. We have a mass of unemployed labour who are being paid to be idle while
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there is all this vital work waiting to be done. To employ people in creating assets makes sense.
The Government say that one of the main reasons for our weak economy is that workers are pricing themselves out of jobs and that high wages are making it impossible for this country to compete in world markets. The inference to be drawn from that argument is that the wages paid in other industrial countries are lower than ours. That is not so.
Wages paid in the United States, in West Germany and elsewhere are higher than ours. If low wages created more employment then the developing countries would have a distinct advantage. As we know, they have no such advantage. The Council of Europe has recently reported that the United Kingdom is in breach of its obligations under the European Social Charter for failing to observe decent wage levels.
Low wages, I suggest, are responsible for a good deal of the unemployment that exists at present in Britain. In the public sector of industry, the Government exercise vigorous wage restraints, and private employers are encouraged to do the same. The Fair Wages Resolution, designed to ensure that workers employed by private contractors receive fair pay and conditions, has been rescinded. The Wages Councils, which set minimum legal rates to be paid to 3 million of the poorest and most vulnerable workers, have been weakened and are now threatened with abolition.
The emphasis on reducing wages will add to unemployment. People will have less to spend on the goods and services they desperately need. There are 3 million people who cannot afford to heat the living quarters of their homes. There are 6 million people who lack essential clothing, and 5· million people who have to do without some essential item of food for lack of income. The lack of demand for goods will mean that factories will have to close down. That this is already happening is made clear by the ever-increasing number of bankruptcies.
Recently, I asked a number of young people what, if they had to choose, would be their first priority; the health service, a home, or a job? They all replied that it would be a job because without full employment the nation would not have the wealth to provide the health service and homes. They said that to be employed preserved one's dignity and self-respect.
The plight of the young unemployed causes me much concern. Because they have no employment they become bored and disillusioned and they tend to drift. They seek temporary excitement and turn to vandalism and petty theft. They need mental stimulation and physical activity. There are many excellent voluntary organisations which provide this, but their work is being threatened now by Government economies.
The honorary secretary of the Institute of Careers, and Careers Officers for Cleveland, Mr. Ray Hurst, whom I knew well when I was Member of Parliament for Middlesbrough, wrote to The Times on 15th December questioning the use by the noble Lord the Minister without Portfolio, Lord Young, of the Beveridge Report:
"For boys and girls there should ideally be no unconditional benefit at all. Their enforced abstention from work should be made an occasion for further training".

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He apparently made that comment to justify possible further restrictions on the right of young people to claim benefit, ignoring the fact that the right to receive benefit during a period of unemployment has never been unconditional. It has always been subject to the condition that the claimant was at all times available and prepared to enter employment.
The Minister, in the same speech, suggested that there were jobs for young people. How can he say this when Government figures themselves show that there are more than 600,000 teenagers unemployed in the United Kingdom and only 9,700 real job vacancies? Mr. Hurst made many other valuable comments in his letter and I hope that the Government have taken note of what he had to say.
The Select Committee of the House of Lords reported that we are not providing enough vocational training compared with other countries in the European Community. In Germany, only one-third of the workforce is vocationally untrained; in France, 40 per cent. of those aged between 16 and 18 are engaged in full-time courses of vocational training; but in the United Kingdom the figure is a mere 9 per cent.
The Government's policy of monetarism and of allowing financial institutions to impose their own controls has encouraged and aided the growth and power of irresponsible multinational companies which owe no allegiance to national government or international authority. They dictate the speed and direction of scientific and technical development. They decide where people will work, regardless of the amount of satisfaction and fulfilment they will get from such employment.
This Government have attacked the fabric of our democratic institutions by abolishing the GLC and banning trade union membership at GCHQ. They have introduced further oppressive legislation to shackle the constitutions of the trade unions. This Government have succeeded in making articulate the philosophy and ideology of a soulless society instead of satisfying man's material, ethical and spiritual needs.
4.37 p.m.
Lord Marsh: My Lords, it is a pleasure for me to follow the noble Lord, Lord Bottomley. In 1959, when I was elected to another place, he and I were both members and officials of the same trade union. When I left to enter the other place he inherited my office, my car and my secretary. At that time I not only viewed him, then as now, with affection, but I also agreed with most of what he said. One of us has changed, and I do not think it is him; but I disagree with a great deal of what he has said today.
I should like to pay tribute to the noble Lord, Lord Murray, for his absolutely first-rate maiden speech. I know that could be something of an embarrassment in some quarters of the Labour movement, and I apologise for it. I also warn noble Lords who do not know him well that his future contributions are unlikely to remain so convivial and non-controversial. On a more serious note, the benefit that this House will undoubtedly gain from his membership and from his interventions in our debates is offset by the gap which he leaves behind in the upper councils of the Trades Union Congress and the trade union movement in this
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country. Indeed, if noble Lords wish to frighten their children they can tell them that the horrors of some of the worst parts of the trade union movement which have occurred in recent years would have been worse still without the noble Lord, Lord Murray—and that he is not there now.
Over the past few years the Government have followed a fairly consistent course in relation to the economy. The Prime Minister has reiterated many times her belief in the need for this country to restructure its industrial base. She did so in the knowledge that this was bound to be unpopular, because when one talks about restructuring the industrial base one means shutting down factories and firing people. That is the brutality involved in restructuring our industrial base, and I believe that it had to be faced.
The Prime Minister and the Government have all the way through recognised that this country can no longer rely on the traditional industries of the past. We are not going to see a revival of the coal industry, of the textile industry, of the steel industry or of the shipbuilding industry—of the big, old smoke-stack industries. If we are successful, they will not form the industrial base of this nation because they are no longer the key industries.
The decline in the importance of those industries means that we have to encourage the development of new industries; of science-based industries and of service industries. I am not talking in terms of hotels and laundries, but of financial service industries and various other industries which give us a lead into the new world. So the Government have over and over again given undertakings that they would encourage that painful, crucial transformation in the country. They have declared themselves committed to encourage skill and enterprise by progressively removing some of the more obvious disincentives in the tax system. Most people would agree that, looked at objectively, you can reward senior executives today much more effectively than was the case a few years ago. We have moved away from a ridiculous situation where the only way one could give a senior employee benefits was by buying him his suits and his shirts, or by giving him a car, with one for his wife, neither of which he wanted as he would rather have had the money.
The country at large needs to take on board that in a capitalist society the creators of wealth tend to be motivated by material things. There are very few first-rate accountants on the market at £5,000 a year. It is very difficult to get a first-rate scientist for £10,000 a year. Those people are motivated by money. Therefore, it has to be paid, and they must be able to see it.
Against that background—and I move to a specific point—I find that changes to the earnings limits proposed in relation to the national insurance contributions are incomprehensible. The noble Lord, Lord Barnett, said he did not think it would do very much good. As always, I largely agree with the noble Lord, Lord Barnett. He, like so many noble Lords on the Opposition Benches, would not stand a chance of office in the other place these days. They would certainly stand little chance of getting selected for a marginal seat—and that is to their credit.

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I believe that the change will have a positively damaging effect. The intention is totally laudable, but it is slightly naive. I have no doubt it is one of those things like the Insolvency Bill. It was probably drafted in the first instance by an assistant secretary or an academic who lives in Islington and votes for the SDP. It is totally unrealistic, and is naïve in the extreme. Life does not work like that—that you can suddenly offer another £3 a week to employ people at the bottom end of the scale and, at the same time, put on a charge of anything up to £2,500 a year at the top end of the scale. In fact, I believe the reverse will happen and the effect in some areas will be disastrous. We all accept that key people of high quality are essential, but they are also expensive. Salaries of £25,000 to £40,000 a year are not high for senior employees in areas like financial services, marketing and the science-based industries. However, as I understand the proposals the increase on a salary of £25,000 a year will be about E1,200 per annum. At £40,000 a year the increase is £2,750 a year.
I am not worried about those individuals, because they will still get paid, since this is an area where market forces apply. As the noble Lords, Lord Murray and Lord Bottomley, know, the rate for the job is based on market forces more than anything else. That is what trade unions are all about—getting the rate for the job and seeing what the market will bear. Therefore, these people will maintain their standard of living. However, the effect on employment in some areas could be disastrous. These highly-paid people tend to be concentrated in particular industries. Frequently, they are in the majority in such industries, and they are not so common in the labour-intensive industries.
I give one example which I know will not be particularly popular. I declare an interest as chairman of the Newspaper Publishers Association. I know that the national press is less popular among the public than journalists believe. Nonetheless, the effect of the proposals regarding national insurance contributions on Fleet Street will be to add between £12 million and £13 million per annum to the bill. There is no way in which the industry can meet that amount. One can complain about how the industry got to that situation, which is another debate. It was before my time, and I will sue anybody who suggests that I have any executive authority in Fleet Street. I exist purely as a buffer between management and the proprietors. If one looks at the financial position of such companies it is not possible for them to meet an increase of that level.
So what will happen? I suspect that some titles will close, and that will involve a great deal of unemployment. I see no other way in which to meet the additional on-cost. I refer to another company in which I am involved—a perfectly respectable, medium-sized company in the field of financial services. The increased wage bill for that company will he about £400,000 a year. How will the company meet that? The company will find that it is much easier to shed a few of the employees at the bottom end of the scale than to shed employees at the top end of the scale. I suspect there will be a positive disincentive to employment by this well-meaning piece of legislation. Moreover, it will produce a return to payment by
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perks, which was a nightmare that many of us hoped and thought we were beginning to get rid of. That is the easy way round it. One goes back to providing the cars, the suits, and a whole host of ways of getting round the legislation.
That specific point leads me to the main issue of today: the problem of unemployment and the implied suggestion that there are some simple solutions to a problem which is as complex and fundamental as it is tragic to those who face long-term unemployment. Regularly we hear from the pulpit and the podium such good gentle words as "care", "compassion" and "caring" exploited to imply that the unemployed suffer needlessly; that because the elected Government for some wicked and undefined reason want to maintain high unemployment they deliberately avoid taking measures which would avoid unemployment or even reduce it. I really do not believe that people, other than extremely stupid people, can possibly believe that. The idea that an elected Government would sit with the answer to unemployment locked in a cupboard, with no one allowed to see it, two years after an election, is ludicrous.
This Chamber is full of politicians—there are nice people as well!—and any politician would love the ability to wipe unemployment off the British political scene. That is simple common sense. Yet still people who I cannot believe are that stupid imply that there is a simple recipe. This morning, when drinking my breakfast coffee, I heard the Leader of the Labour Party in a radio interview commenting on the new policy to combat unemployment which was presented yesterday. I was amazed to hear him say, when asked how rapid would be the effect on unemployment, that it would reduce unemployment by 500,000 in the first year and by another 1 million in the second year—presumably to be abolished in the third year. I must say that I find that very surprising. The simple recipe for this massive change—and it has been put more eloquently this afternoon from various quarters, not least by the noble Lord, Lord Barnett, who, as a Treasury Minister, was much less free with public expenditure than he has become since he left that office—is a massive increase in public spending. As the noble Earl, Lord Gowrie, pointed out, that is a simple prescription that we have tried, and tried and tried again, over decades. Unemployment is not a new problem in Britain.
In his first speech in this Chamber the noble Earl, Lord Stockton, drew attention to the fact that unemployment in Stockton today is similar to that which existed when he entered Parliament 60 years ago. The moral is that successive Governments have tried for decades to bring employment to the North-East and to the unemployment black spots of Wales and Scotland. We have tried massive expenditure on public works—the Humber Bridge, the Leyland bus factory, road-building and subsidies to coal, steel and textiles—and yet the worst areas of unemployment 40 years ago are in most cases still the worst areas today. All that has not changed the pattern of unemployment in this country.
Of course, unemployment is not just a British problem. There are today over 20 million people unemployed in Western Europe. Even West Germany, the most dynamic economy in Western Europe, suffers

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with 2½ million unemployed, not counting many thousands of repatriated foreign workers. Europeans suffer because we have not yet been able to restucture our industry and our society to enable Europe to compete with the United States of America and the growing threat from the Far East. That is why I hope that the Government will not be diverted from their policies.
5.1 p.m.
Lord Dean of Beswick: My Lords, may I join with previous speakers in the appreciation they express to my noble friend and colleague Lord Barnett for initiating the debate? I am certainly grateful for the opportunity to place on record in this Chamber my appreciation to my noble friend Lord Murray for the quality and content of his maiden speech. Also, as a life-long trade unionist of nearly 50 years' standing, I wish to express my appreciation of the work that he put in during his stewardship as secretary of the TUC. He had to contend with one of the most difficult periods for trade union public relations and their public image. I think that he did extremely well in a difficult situation.
It is to be regretted that in some respects the present Government did not listen to some of the more sound advice that he gave them. The fact that they almost totally ignored most of the advice that he gave them on various issues in some respects has bounced the ball into the court of the less moderate factions of the trade union movement. I think that some of the difficulties that we have recently experienced might have been avoided had they only listened to him a little more intently. Certainly I do not think that some of the actions that we have seen in the recent past would in any way be respected or looked on with favour by my noble friend Lord Murray—Len Murray as we used to know him. I pay my full tribute to the services that he gave.
What is this debate about? It is about the Budget, and the Budget is supposed to be a Budget for jobs. I take the totally opposite view. It is not a Budget for any such thing. I have seen quotations by various bodies recently which have predictably come to the aid of the Government to say that the Budget means 300,000 jobs, or 200,000 jobs, an increased number of people going into training, and 100.000 extra jobs by virtue of the fact that wages councils will be abolished and wages at the bottom of the scale will be depressed.
I take the view that something much more drastic must be done. I do not follow the noble Lord, Lord Marsh, down the road that he takes. Most responsible people feel that at least 50 per cent. of the increased unemployment that has taken place since 1979 is a direct result of Government policies. Certainly nobody has put the case that that is not so. A figure of 300,000 people is being talked about as those benefiting from new jobs as a result of the Budget. I take the view that we may just have 200,000 better trained people languishing in the dole queue and a wider distribution of misery at the bottom end of the wage scale.
I used to be involved in a sense with wages paid in the catering industry, and I never found that those people were overpaid. My role was as a sort of employer as secretary of a large Labour club. Nobody
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has presented anything at all to us to show that depressing wages at those levels will create jobs. I predict that it will not.
There are two schools of thought at present. One is to follow the policy that the Government are putting through in their legislative programme. The other is that there should be a public sector inspired regeneration of the country's infrastructure as a viable investment which is well worth the money and the time. That is certainly an economic proposition which is worthy of attention and it should be put through as a policy. The second option is being adopted by more and more people in responsible sections of our community. In fact it is being said that there is a far better Cabinet on the Back Benches on the Government side in another place, and they are totally against the Government's economic policy and in various degrees would be in favour of some form of reflation in the public sector by tackling this devastation of the infrastructure.
With the leave of the House, I should like briefly to quote one passage from the report of NEDO which was prepared for Neddy. It states:
"In many areas the present systems and levels of resource allocation have led to failures to maintain the fabric of building and structures, to remedy structural faults, to renew worn-out components and to remedy obsolete features. In some areas delayed and insufficient expenditures have led to accumulating and accelerating backlogs of work as the deterioration of the stock and the cost of crisis repairs increase. It is claimed that there are many instances where the quality of service provided has fallen below statutory or minimum acceptable standards".
I am not making the case that we should take such steps just because we have so many in the building industry who are unemployed. Some noble Lords may remember that a few weeks ago I had the privilege of initiating a debate in the House on the building industry. Those who provided the brief for the Minister who replied stated that the building industry was having its share of economic revival and was doing very well. All the associations involved in the building industry, including the Federation of Master Builders, the Building Employers Confederation, the Institute of Maintenance and Building Management and the Federation of Civil Engineering Contractors, and the trade union side thought that that statement was beyond belief.
The Government were quite clever. I suppose they thought that nobody would be intelligent enough to analyse what they had done. They had perpetrated a con trick. They took the figures for increase in building activity from 1980. The figure that the Minister gave on that occasion for total construction and building work in the country was £20 billion in 1981 and £21¼ billion in 1982, moving to £22 billion in 1983. But, had they gone back 12 months before 1980 to 1979, when they took office, even at prices then, when there was more value for money because of the effects of inflation, we should have learnt that the figure was £23 billion.
Some noble Lords, including those who have already spoken in the debate, may have received a letter from the secretary or the director general of the Federation of Civil Engineering Contractors, which said such things as that the figures being used were no credit to the Minister or the Government which he was representing. That was the federation's terminology

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and not mine. Those are the facts that we have before us. In the building sector alone there are 400,000 people on the dole. I am not saying for one moment that it is possible overnight to translate money into jobs for those people, but the building industry, which traditionally is one of the biggest employers of labour, is able to translate invested money into jobs more quickly than any other industry. It is on that basis that I urge the Government, in conjunction with people of different political persuasions, people from their side of the building industry as well as the trade union side, seriously to consider what they are doing in allowing the deterioration of the infrastructure that is presently taking place.
The house building programme in the public sector, compared to previous years going back to when the noble Earl, Lord Stockton, was Minister of Housing, is an insult. It is predicted that there will be about 50,000 houses built this year in the public sector. If you look at the private sector, though that started to lift up a little hit, it is now starting to peter out.
The parts of the industry that are operating in building for industry show a progressive increase. That is extremely welcome. However, in all these other parts of the building industry we have people homeless, we have people badly housed and we have hospitals in had condition. A hospital not very far from where I live was in such a bad condition that salmonella was rife and caused numerous deaths. This is due to the fact that money is being withdrawn where it should be being spent on maintaining and improving the infrastructure.
This Budget, as it stands, will do no such thing. It will create no jobs in a real sense. Looking at this Budget, I would not see any prospects of the people in the dole queue, who are unemployed and who really want to work, drawing any optimism from it. I sincerely hope that there will be an increase in the number of people supporting the Opposition Benches. They have grown in number. The noble Lord, Lord Alport, is present in the Chamber. A few weeks ago I had the privilege, as no doubt did some of your Lordships, of reading an article that he had written in the Daily Telegraph, which drew conclusions as to how the Government were wrong. I do not think anyone could disagree with one word he said.
There is a case for a massive investment of public money to pay people to work instead of paying them while they are on the dole. There is a case for building more houses. There is a case for modernising houses. There is case for repairing houses and building new homes, new hospitals, new roads and new sewage system to replace the present ones which date back to Victorian times, I hope the Government will think again and that this Budget is the last of this kind we shall see from this government or from any other.
5.3 p.m.
Lord Alport: My Lords, I should like to begin, if I may, by congratulating the noble Lord, Lord Murray of Epping Forest, on his distinguished maiden speech. Like him, when preparing for this debate my mind was focused on the White Paper recently issued by the Government, Challenge to the Nation, which encapsulates, in effect, the results of the Budget upon the present problem of unemployment. A White Paper which is endorsed by six Secretaries of State and the
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noble Lord, Lord Young, has a right to be taken seriously.
When I had finished reading it and had analysed the proposals in the summary at the end I came to the conclusion that the Government believe that the problem of mass unemployment cannot be solved, and, in a mood of fatalism, do not really intend to try. They appear to be content to provide what the London Business School calculates will be 150,000 dead-end jobs for youngsters between 16 and 18 and 150.000 low-paid jobs as a result of certain financial adjustments in the recent Budget.
I have in many speeches in your Lordships' House and elsewhere been critical of the Government's policy to combat unemployment. Therefore, it would be perfectly fair if I was asked, "All right, what would you do?". I accept that, looking into the future the development of industries in the field of technology is of first importance. This requires investment in new companies and new techniques. But it also requires a strong home market. Today, the British market is flooded with consumer technological goods from Japan and Taiwan. During 1984 we imported from Japan £4 billion worth of such goods and we exported to Japan less than £1 billion worth—a balance favourable to Japan of nearly £3 billion. Over the same period we imported from Taiwan £585 million and exported only £150 million—a balance in favour of Taiwan of nearly half a billion.
I use these two countries simply as examples. None of these imports is essential for defence; none contributes to the current standard of living in this country; all compete with the trade of our real trading partners in the EEC. It is high time that Japan, for instance, ceased to export its unemployment at our expense. I realise that if we now decided to protect our industries in this field it must be after consultation with the EEC and within the general ambit of GATT. But the first thing I would do is to introduce a policy of selective protection for British industry, particularly for those firms developing in the technological field.
I should remind your Lordships of two matters. One is that the United States Senate—that very successful and prosperous country—has recently come to the same conclusion and that our partners in the EEC are deeply worried by the present situation. I should remind my noble friends on this side of the House that the policy of selective protection of the British home market to aid the development of new industries and to help to solve unemployment has been the cornerstone of Conservative policy for almost the last 150 years.
Secondly, I should direct the Government's procurement policy to the principle of buying British. In the Observer last Sunday there was a report that the Government have authorised Nottingham University to buy technical equipment costing £700,000 from the United States instead of from a British company which produces plant which is at least equally efficient and costs less. There is a fashion of thought widely current in this country that anything which comes from overseas is better than anything we produce here. The Nottingham University case seems to be a typical example. If the Government lack confidence in Britain, consumers generally will do the same. I should

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like to see a full inquiry as to how and why the Nottingham decision was made.
It should be the Government's policy to encourage state industries, local authorities, all Government departments and particularly the Ministry of Defence to buy from British firms wherever this is possible. I will not enter into the controversy which has surrounded the appointment by the Secretary of State for Defence of Mr. Levine. But even assuming that his appointment is both legal and appropriate, has he been instructed to place the enormous orders for which he will be responsible with British industry?—unless, of course, there is some NATO defence consideration of standardisation to the contrary.
In Colchester we have a company which in the last war made diesel engines for submarines with immense success. I have not inquired whether it has any Admiralty contracts today. All I know is that its labour force has shrunk dramatically during the last few years. But this enables me to illustrate another point I am trying to make. A year or so ago I joined with others in my town of Colchester to launch a business enterprise agency to encourage, advise and help those who want to start small businesses. It has the support of the Colchester corporation and almost all the leading companies and professional firms in the town. It has had a stream of clients, many of whom have started their own small businesses, mainly, I think, in the craft and service industries. I think I can claim it has been as successful as any agency anywhere. At the last count it had helped to provide jobs for 70 people. The unemployment in our district, which is below that in many parts of the country, is 7,000. At that rate it would take 100 years for small businesses to absorb current unemployment locally. A Government contract to any of our major companies would, within weeks, give jobs to ten times the number which small businesses could recruit in a year.
I am not making any special plea for Colchester. I am merely illustrating how the Government can help, by their procurement policy, to reduce unemployment; and I am trying to illustrate the fact that, however valuable the encouragement of small businesses may be for starting men and women with courage and determination on the road to indepenence, the policy is irrelevant to the solution of the problem of unemployment.
Next, I would launch a campaign to "Buy British and give someone a job". It has been done before. The Government should not underestimate the deep concern of people in Britain, and particularly in the more affluent south, about the unemployment problem—especially among those who themselves have jobs and the security that this involves. They are not content to leave it to market forces, the uncertainties of the interest rates or the aberrations of our fiscal policy. They want to do something themselves, and find it very difficult to know what they can do. A buoyant United Kingdom market for British industry—the choice of a car, for instance, from Coventry, and a computer from Cambridge, against an import—would give a fillip to British companies in the home market that would help both with their development and with the employment that they are able to provide.
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Lastly, I have no doubt that the time is overdue when there should be changes in the pattern of employment and industrial wages. I remember the late Mr. Samuel Courtauld, one of the wisest and most experienced industralists of his generation, saying to me one day, "No one can work in any industrial process for more than 40 hours a week at full efficiency". This means that where a company is paying overtime beyond 40 hours, at one-and-a-quarter or one-and-a-half, as the case may be, they are not getting, to use a favourite ministerial phrase, "value for money".
My point is illustrated by the impending Post Office strike, which I hope, I may say, will never happen, but which, I understand, relates not only to the use of improved technology but also to the use of part-time workers or, as some might describe it, a process of work-sharing. A transition of this sort should not be brought about by confrontation between management and workers in a major public service. It is something that affects, and will do, the whole spectrum of employment in the public and private spheres alike. My proposal is that a major change in the pattern of hours of work and wages should be examined by the Government, employers and the leaders of organised labour—the trade unions—with terms of reference that cover the whole of British industry. The study should seek to take account of the revolutionary changes that the economic, social and political circumstances of this county have brought about since the end of the last war. It should consider how profit sharing and productivity bonuses can replace overtime.
There is nothing new or revolutionary in these ideas. I do not claim that they will solve the whole unemployment problem. But I know that they are practical and I know that they will help. More than that, they will change the climate of defeatism and helplessness so abundantly evident in the White Paper. Let me emphasise to my noble friend, Lord Gowrie, that all that I suggest can be done without any drain on public funds or adverse effect on inflation. Such expenditure as might be involved would be met by savings from the present cost of unemployment benefit for men and women who will no longer claim it. This does not mean that I do not underestimate the importance of investment to which reference has been made many times in the debate. Now that we have the advantage of the proceeds of North Sea oil there should be investment at this particular time, I believe, in public works; in housing, in transport, inner city renewal, energy and local and national services.
The Earl of Gowrie: My Lords, there is.
Lord Alport: My Lords, any prudent Government would regard such investment as a vital contribution by this generation to preparing Britain for the 21st century. It is easy for the Government to advise people to move to find work. Every day in the year youngsters arrive in London from the Midlands and the North looking for work. Too often, in spite of the dedicated voluntary organisations that seek to help them, they end up penniless and workless, living in rotten digs and a prey to pimps and drug sellers. It is no good telling the unemployed to go and find work when there is no work for them to find. It is no good the Government

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issuing challenges to the nation if the Government face their own challenge with a confession of defeatism and helplessness. If this Government are unable to meet the challenge, then I can tell them that a deeply concerned and patriotic electorate will, in two or three years' time, find a Government that will.
Lord Graham of Edmonton: My Lords, we are ready.
5.15 p.m.
Baroness Carnegy of Lour: My Lords, I should like to join in welcoming the speech of the noble Lord, Lord Murray. I spent several years as a member of the Manpower Services Commission alongside his TUC colleagues. It is good to hear him paying tribute to what the MSC has done in helping governments of the day in industrial affairs.
The noble Lord, Lord Barnett, is an experienced and distinguished politician. But listening to his speech and indeed to those of many noble Lords with, if I may say so, the notable exception of that of the noble Lord, Lord Marsh, one cannot help reflecting that on the question of what to do about unemployment, the people of Britain are now well ahead of the politicians. And the Budget is probably much closer to popular opinion than many noble Lords would have us believe. What are the true facts as perceived by the ordinary man and woman in the street? How do they see the causes of unemployment? How do they see this Budget? If the polls are to be believed, there is now widespread agreement that bringing down unemployment is a top priority but that it must be done without damaging the improving of competitiveness in wealth-creating industry and must be done without fuelling inflation.
In addition, most people know really rather a lot about the problem as it is on the ground, whether from their own experience or that of friends. They know that all over the country, there are employers, many of them small employers, whom it would suit very well to take on one or two or many more extra people but who, in fact, are doing everything they can not to take on those people. The usual reasons given are the hassle, the cost and the difficulty of finding the right people for the job. There are many other small employers who have actually given up employing people altogether and who work on their own for the same reasons. Most people also know from their experience those who are unemployed who genuinely want work but who are discouraged because they find that the only employment available would leave them scarcely better off than does the dole. In the same way, married women who are looking for work find it difficult to locate a job which, at the end of the day, will leave them and their husbands better off than if they stay at home. Most people know 16 and 17 year-olds who, on leaving school, have been persuaded that if they cannot get a job they should simply do nothing. Now, with no training, no experience and no track record, they are unemployed and likely to remain so.
Most people know at least some long-term unemployed—those who have lost the will, who have lost the work habit. They have resigned themselves to the dole and to the company of others in the same
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position. Most people have friends who have contemplated self-employment but who, having done their sums, find the high national insurance and tax a persuasive disincentive. These and many other practical problems which the Budget seeks to ease are nowadays very familiar to the majority of people and seen as in crucial need of attention. I doubt if the initial disappointment reported in the press came from many but the chosen few. I also doubt whether the kind of protectionism that my noble friend Lord Alport has been suggesting, would be widely welcomed as sensibly realistic. I suggest that once the electorate are fully aware of the employment implications of the Budget and of the three linked White Papers which have so far been published, they will welcome the strong and hopeful sense of direction which is now emerging.
Given that the number of people wanting to work is likely to increase by an average of 120,000 every year until 1990, it is clearly necessary not just to replace the jobs which are disappearing, but to speed up the creation of many more jobs. A great many have been created in the last few months, but many more will have to be created, and that can only be done by making it more attractive and easier to employ, to be employed and to be self-employed. It seems to me that the Budget moves in that direction—in the direction of turning growing productivity and output into the taking on of more people at lower wages rather than—and this is the important point—it all going into higher wages for those in employment already, leaving the rest literally living off the crumbs that fall from employed people's tables, which is what being on the dole is all about.
I believe that those in reasonably well paid jobs in Britain will be prepared to allow that to happen and will see the implied pause in the improvement of living standards as justified in that it helps other people to begin to earn and in the longer term helps the prosperity of all. People want to get back to one nation. I believe that this is a one-nation Budget.
People will also see many of the constraints on employment—constraints with which they are personally familiar—removed. I refer, for example, to 30 pages of complex wages council regulations which may be all right for the big boys of the CBI but which are a considerable burden, as is well known, on small employers and are not easily understood by employees either. There will be more money in the pockets of 800,000 workers who are coming out of tax.
There are proposals—and it is astonishing that no noble Lord has mentioned this point—for tax equality for married women and the end of their particular form of poverty trap. There will be the addition, as has been mentioned, of 100,000 more opportunities for the long-term unemployed to regain the confidence and the track record that they need for work, through the already successful Community Programme. Moreover, if that succeeds, there will be more places to come. The Youth Training Scheme is to be extended so that in future—and this is literally what it means—every 16 and 17 year-old can become the possessor of basic skills and qualifications by staying in full-time education towards a qualification, by training towards a qualification or by having a job, one hopes, with training towards a qualification. When that happens, no young person need be stuck without

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competence and no employer need be stuck for an able young person to employ.
The direction of this Budget is towards a labour market where people are far freer to employ and find employment in ways that suit all concerned, and where fresh demand can far more quickly be turned into new jobs and growing prosperity without damaging competitiveness or fuelling inflation. We are entering new territory, and new problems require new responses. I believe that the Budget, as it reveals itself, will be seen by ordinary men and women as the beginning of a bold and imaginative response—a lead in a clear and hopeful new direction. I believe that it will turn out to be what the Chancellor has claimed: truly a Budget for jobs.
5.25 p.m.
Lord Ezra: My Lords, I do not wish to add to the embarrassment of the noble Lord, Lord Murray, by congratulating him on his maiden speech, which many of your Lordships have done this afternoon. However, I should like to recall the unfailingly objective and sympathetic way in which he helped to resolve many industrial relations problems in the coal industry during the latter part of my period there. A continuance of that attitude as between trade unions and management is something which we should all try to see restored at the present time.
The noble Lord, Lord Barnett, has given us the opportunity to have a serious and wide ranging debate on some of the major issues which face us. I believe that two points of agreement have emerged out of the debate so far. The first point is that the present level of unemployment is unacceptable. The Government have said that that is so and everybody else shares that view. The second point is that there is no magic solution. However, having said that there is no magic solution, one should not be led to fail to seek an answer even though it may be complex, difficult and require a combination and a variety of solutions. Many valuable suggestions have already emerged in the debate and I am sure that the noble Lord, Lord Young, will take account of them when he sums up at the end.
For my part I should like to concentrate on one aspect, and that is capital formation. I believe that capital formation—capital investment—will have to play a major and more important role in helping to find a solution to the unemployment problem than it has so far. In looking at the question of capital investment, I am well aware of the views expressed by the noble Lord, Lord Marsh, in which he said that there is no way in which one can borrow one's way out of this type of difficulty. I entirely agree with that view. However, having said that, it does not mean to say that the capital investment route is not one of the contributors to the solution which we must seek.
I was very pleased indeed to hear the remarks of the noble Viscount, Lord Watkinson, with whom I had the pleasure of working very closely when he was president of the CBI. He was entirely right in drawing attention to the way in which capital and revenue are muddled up in Government accounting. There is a need to establish priorities in Government expenditure. As the CBI have said in their latest publication, there is a need to introduce a qualitative assessment in this field. There have been many debates
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on the whole subject of investment in basic services, one of which was recently introduced by the noble Lord, Lord Dean of Beswick. The recently published NEDO report has shown that those who have been pressing for rather more investment in that area have not been doing so simply as a means of finding a solution to the unemployment problem, although undoubtedly it would contribute in some degree to that end; they have been doing so because they have been increasingly convinced that there is a need for this additional investment. The Government will of course say, "But there is a large measure of investment already in these sectors". That is perfectly true. The question is whether, in the present circumstances, it is large enough; and the evidence suggests that it is not. The evidence also suggests that a limited amount of additional borrowing on the famous PSBR of the order of £2 billion to £3 billion devoted to this cause could make a great deal of difference to the efficacy of what is described as the infrastructure and could create a number of real additional long-lasting jobs.
All these figures have been worked out by responsible bodies within the construction industry and outside it. They are not figures which have been drawn out of the air, and I have no doubt they have been fully studied by the Government. That is an area which seriously needs to be looked at and I was encouraged the other day, watching the Chancellor in a television debate on a Sunday, indicate that possibly when he came to the next Budget, depending on all the circumstances and provisos which every Minister always introduces to qualify anything he may be saying about the future, nonetheless, he might well be tempted to extend his borrowing activities. I very much hope that that will be so and I very much hope that a large part of those additional borrowings will be used in the public sector investment. But investment in the private sector is also going through a difficult patch. As the CBI has pointed out, the major impact of the previous Budget reduction of investment allowances is going to bite in the next two years; that is 1985–86 and 1986–87, and there is going to be what the CBI has described as a dip in the level of investment in manufacturing industry.
It would have been helpful if some modification had been introduced in the impact of the withdrawal of these allowances in the last Budget because this was dealt with in considerable detail in the CBI's submissions to the Government. The fact is our manufacturing sector has diminished over the years. The fact is we are importing, as noble Lords including the noble Lord, Lord Alport, emphasised, more and more in net terms of manufactured production; and while the noble Lord, Lord Marsh, might have been right to some degree in what he said about the smokestack industries, all I can say is that some other nations have not given them up. They have modernised them and they have applied new technologies to them; and a large proportion, for example, of the textiles being imported into Britain today are coming not from the Far East, but from revived and modernised textile plants in Western Europe. So I believe that there is a very large area for us to be looking at there, and studying what other countries have done to apply modern technology to old industries. Do not let us give them up too easily without a fight.

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There is the question of services. It has often been said that we are becoming a more service-orientated country, and certainly the services are of very great importance. There is not the slightest doubt that the banking services of this country, the shipping services, insurance services and so on, are earning the country a great deal; and that includes tourism. The CBI has, however, in its recent publication, which I find full of wisdom, entitled Change to Succeed, demonstrated that there is a balance between services and manufacturing. The CBI shows that we need to find a correct balance. Manufacturing, it says, does matter for jobs and wealth creation and indeed for the success of many of the service industries whose products we buy. There is this very close interrelationship between the service industries and the manufacturing industries. Indeed, there is a very close interrelationship between the private manufacturing sector, the public manufacturing sector and the public service sector. It is this close interrelationship, I believe, which should form the basis of a review of the various steps which we should now be taking to try to create more real investment in this country.
We should do this all the more importantly at the present time because on the one hand there is a strong undertone in our affairs which should enable us to do a number of these things. We still benefit from North Sea oil and from the sale of assets; but looking at the wider world, there are small clouds on the horizon which could become big ones. There is a great deal of uncertainty arising in the United States. There have been banking crises, there is a crisis in the farming industry, many of the large corporations are showing reduced profits as a result of the strength of the dollar, and we have seen this translated into the major fluctuations of the dollar in recent times. We in Europe have always tended to take the view that one of the problems we face has been the strength of the dollar and the impact of high interest rates which that has generated; but we should also be careful of what might happen if the dollar went into reverse and if the American market—which has been so open to so many countries—suddenly closed, and if the funds which have been made available throughout the world as a result of that were to dry up. We have to prepare ourselves for that kind of situation.
Now I believe is the time when we should be reviewing our whole economic policy so as to strengthen not only our public base hut our manufacturing base. I believe that now is the time when we should be strengthening our links within Europe; and my colleagues and I on this side of the House feel that one of the most important ways we can do that is by finally taking the plunge into joining the European Monetary System. We have heard as lately as yesterday the noble Viscount the Leader of the House saying, with that pleasant smile with which he always comes up with rather unpleasant news, that the Government still feels that the time is not right. It has of course defied the imagination of many of us who feel that we should be joining as to when the time might be right.
I believe that we are at a very important phase in our affairs. There are no magic solutions, but I believe that there are a number of specific solutions which if put
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together with vigour and determination and with, I believe, increasing support from many quarters, could go a long way to helping us to solve some of our major problems.
5.37 p.m.
Lord Houghton of Sowerby: My Lords, after such a notable speech from my noble friend Lord Murray of Epping Forest, I am sure that the House will welcome one more brief tribute to my noble friend who I am sure, we all agree, is a great accession to the prestige of this House. Like other noble Lords, I have known him for many years and I have had very close contact with his work in the trade union movement throughout his career in it. Those of us who know him realise that he is a man of great ability, deep intelligence and strength of character, and I am sure that we shall welcome any contribution in the future which he may feel that he can make to our troubled deliberations on this and allied subjects.
I do not believe many people come to your Lordships' House these days for their politics. We come mainly for what wisdom we can offer and what opinions we can give which may help a troubled people in these difficult times. We have behind us experience; some of us experience of government responsibilities, others of long service in many other importnt fields of public life and activity. So in my speech I am going to follow that approach to the role of Members of this House.
Let me say to begin with that I am broadly in agreement with the strategy of this Budget at this time. The Chancellor made a mistake in calling it a budget for jobs before he even introduced it and again as he sat down. It raised false hopes that by a budget for jobs he meant a budget to create jobs with schemes of public works to bring about employment. That surely was never the Chancellor's approach, nor is it mine, and nor, judging from the remarks that have keen made by the noble Lord, Lord Ezra, would it be his.
We must examine that point a little more carefully because there are many misconceptions about the possibilities of public expenditure for job creation. Budgets are about supply, about providing the resources to meet programmes of public expenditure. This particular Budget may have disappointed many people at home, and many of my noble friends here, but it gave added confidence abroad; nothing spectacular, but it certainly did good. The Chancellor's caution I think helped to strengthen the pound by contrast with the fall in the dollar. Coincidental it may have been; nevertheless, the two things took place at the same time.
The noble Lord, Lord Ezra, in his distinguished speech, referred to the United States. Here again much opinion in this country was encouraged to believe that we could look to the United States for a remedy for our own affairs. Many critics of President Reagan's general approach to politics in the United States seemed to be suggesting that what he could do with the American economy Mr. Lawson could do with ours. I do not think that that was ever on. As the noble Lord, Lord Ezra, has just pointed out, the economy of the United States is so different and its approach to its own problems is so different from our own in some respects that there is really no comparison to be made.

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There is no Franklin Roosevelt New Deal going on in the United States at the present moment. Their budget, with a huge deficit and borrowing, is not to finance public works and improve the infrastructure of the country, but to finance tax reductions and the astronomical growth in defence expenditure. It is a sad reflection that rearmament, more than once in the experience of many of us in this House, has contributed to solving temporarily—and disastrously—unemployment when other remedies have failed.
I congratulate the noble Lord, Lord Alport, on his most provocative Budget speech on behalf of the "Independent Conservative Party". It was one that is worth a debate on its own. But I remind him that Britain went protectionist once before. Although I do not think that any of the remedies that either he or other noble Lords have mentioned should be brushed aside merely because they were tried before, they need re-examination in the light of conditions today, and we may come to different conclusions. The protectionist line of country, I warn the noble Lord, is very difficult and dangerous in the world of today, as indeed it was before.
The United States are not only doing some of the things that we might tolerate here; they are also beginning to cut the rate of new entrants to industrial employment throughout the United States in order to reduce costs. If we were to have something equivalent to the economy of the United States, we should have a complete merger of the EEC with our President in Brussels. That really would be the equivalent of the American economy.
However, if we come to the Budget and see what it is intended to do to help matters here, I think that the Chancellor's choice lay between selective expenditure and tax reductions. My preference in present circumstances is for tax reductions, and in certain circumstances I would even borrow for tax reductions. I believe that the Chancellor does not entirely rule that out of his own perspective; but not in this Budget, and only for essential needs and a profitable outcome.
The reductions in taxation secure the largest and widest spread of released resources, and we have to have regard to some of the problems and difficulties of selective expenditure. In my experience—and it is long in this connection—selective expansion is always uncertain in its effects, nearly always wasteful and inefficient under the stimulus of Government-sponsored demand.
There are plenty of examples of the grave mistakes which have been made in the past. Any former member of the Public Accounts Committee—I am one, my noble friend Lord Barnett is another, and the noble Lord, Lord Boyd-Carpenter, yet another—if he is honest, will admit that we have seen some quite dreadful things in public expenditure, some of which have received considerable public notice, while others have not.
It would be wrong to concentrate heavy public expenditure upon selected labour intensive industries beyond their capacity for efficient work. We need more investment there, and we need to sustain the activity there, again as the noble Lord, Lord Ezra, has just said, but it should come out of resources which we can spare from wealth-creating enterprises.
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We have other warnings here. In building and expanding the welfare state we have made forward commitments well in advance of our known prospects of meeting them. If we are to regard the honouring of our obligations in that field as an important part of public policy, we must safeguard the structure of our welfare services even against demands in other directions. Public works should not be neglected. They should be considered certainly as a factor in alleviating unemployment, especially at this time, but not as a main purpose.
Perhaps I may turn to investment in private industry. There has been some criticism of the investments we have made in other countries recently. Indeed, I believe it is the policy in some quarters that a lot of that investment abroad should be recalled, or even press-ganged to be brought back home. Frankly, I do not feel that that is a proposal that is worth examining in this connection. Capital has gone abroad because it can be more profitably used there than here, and some firms in this country have maintained their prosperity here on the proceeds of more profitable activities in other countries.
There is no shortage of capital in this country for profitable industry. Institutions with large sums of money available are looking for profitable outlets all the time. I do not think that any public borrowing is likely to be necessary for that. But when it comes to efficiency and profitability budgets can help, but they cannot replace the human factor. The noble Viscount, Lord Watkinson, had something to say on that, and we must admit that there are deep-seated aspects of our affairs and our attitudes which are a great worry, and we cannot really see the end of them. I am not in favour of borrowing to finance a subsidy state. I do not think that we ought to try to emulate the United States in becoming the world's biggest debtor country.
I turn to taxation, though only for a moment or two, as I see that my time is running on. I think we should make better use of taxation. There is much to be done and I am glad that the Chancellor is to make a start. The whole system of imposing burdens upon industry and people needs drastic revision. The black economy can never be eradicated in present circumstances. Much of it is only a circumvention of grievances regarding an outdated tax law. Too many people are having to pay for tax concessions given to others who are better off than themselves.
A final point on taxation is that Chancellors will not get very far on reform of taxation if they look for a neutral outcome to the exercise. They must be prepared to contemplate some redistribution of taxation within a scheme of reform. We would have a tax credit scheme now had the Government of the day not said that it must be considered on the basis of neutrality and not on redistribution. Tax reform will have to have an element of redistribution because injustices in taxation will have to be smoothed out at some cost to some taxpayers and should not be removed wholly at the expense of the Exchequer. The Chancellor should not begin to stress budgetary provision for jobs as a general theme. That has to be undertaken in a much wider context. The Statement we have had from the noble Lord the Minister without Portfolio will add to our consideration. New jobs grow from seed rather than from any other source. They do

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not do very well if they are planted. I hope that following this debate we might have another, if I may humbly suggest it.
After this Budget, what next, my Lords? We should rapidly turn our minds to the future. Your Lordships' House has already shown that it is conspicuously well-suited to examine a problem of this kind in great depth. It might repay to ask noble Lords who assembled previously to consider unemployment to renew their task and give us a fresh report. The country is waiting for sensible solutions. It will be a great pity if your Lordships' House had no contribution to make amidst the clutter, a good deal of it unseemly and distressing to many of us, of the political battle that is going on. People are getting fed up with the clash of political arms out of which come mostly the remark, "You are just another." It is time that your Lordships' asserted your role as the new leaders of public thought and showed the way to those who are engaged in the struggle for power so that business can be attended to in a more temperate manner.
5.54 p.m.
Lord Bauer: My Lords, I should like to add my mite of a tribute to the noble Lord, Lord Murray of Epping Forest, for his notable maiden speech. Not all of us will agree with its central thrust, but I think we will all agree that it was highly effective as indeed we had expected it to be.
With the prevailing heavy unemployment the advocates of expansionary policies have again become vocal, even vociferous. They think that heavy unemployment reflects insufficient monetary demand and that the risk of higher inflation is small and worth taking. The reasoning rests critically on the belief that unemployment results from deficient monetary demand and the heavier the unemployment, the greater the demand deficiency.
How stringent are financial policies? Over the last five years both total monetary spending and retail prices rose by well over one half. Total output, however, increased by only about 2 per cent. and the rate of unemployment by over 140 per cent., and it is now about two-and-a-half times what it was five years ago. Retail sales register new records almost every month. Every day observation, such as crowded shops, the difficulty in getting repairs done, the spread of self-service establishments, the waiting time for consumer durables and equipment, all point in the same direction. Not all employers in the hotel industry find it easy to recruit young people, even from Liverpool and Newcastle, with offers of full board and lodging and a wage of £80 a week. Is this the stuff that insufficient demand is made of? The reason why the Government, in common with others in Europe, hesitate to adopt more expansionary policies is that they rightly suspect that this would re-invigorate inflation.
The situation here and elsewhere in Western Europe reflects the extreme difficulty of wringing inflation out of economies where inflationary expectations are strongly held; and they will not diminish as long as Governments show no sign of being able to rein in their own spending. The tenacity of inflationary expectations is not surprising. We have been experiencing by far the longest and most pronounced
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peace-time inflation in centuries. Hence the continuing wide yield gap between index-linked and conventional gilts and also the high level of interest rates. People also realise the strength of various social, political and economic forces which operate against the reversal of inflation, and even more against an actual general fall in prices. There is a huge volume of both public and private debt. The debtors are economically more active and politically more effective than are creditors, and they would suffer, often very severely, from a decline in the price level. The rigidity of wages and salaries and also of prices controlled by state supported cartels, from air transport to potatoes, adds to the political and practical difficulties of reducing the price level.
In the Budget speech the Chancellor described as relatively low the current inflation of about 5 to 6 per cent. In the debate on the Queen's Speech last November I reminded your Lordships that with 5 per cent. inflation 1 is reduced to 3p in a lifespan of 70 years. I quoted Keynes—that maintenance of the value of money should he a prime duty of the state because of the waste, the distortion and above all the injustices of inflation which hit hardest people with modest means. And here we have a Chancellor widely regarded as a hard liner who thinks that 5 to 6 per cent. inflation is relatively low.
Advocates of expansionary policies urge that they should take the form of increased Government spending rather than tax cuts, because the latter might result in more saving and fewer jobs. Besides implying that lack of aggregate demand is behind unemployment, this argument ignores the incentive effects of lower taxes. If the tax cuts are concentrated on the relatively poor, they will not result in much increased saving. Even if some of the tax cuts were saved, this might reduce pressure on nominal interest rates which would benefit activity. The only certain difference between the two methods is that increased Government spending further enlarges the state sector.
Advocates of more state spending suggest that it should be in the form of infrastructure investment. We have heard a lot about this here today. "Infrastructure" and "investment" have become omnibus terms, buzz words. The most diverse items have come to be termed infrastructure; and both businessmen and politicians readily talk about investment when advocating more spending, as in the advertisement, "You buy a car, but you invest in an Austin".
My Lords, the budget is in the right direction, especially in the insistence on financial restraint. The tax changes will help to provide jobs. The effects of the specific schemes are more equivocal, as they are financed by either taxation or borrowing. But although the Budget is undoubtedly helpful, it will not affect total unemployment greatly. There are major forces in the opposite direction. There are still many claimants-to-be of social security benefits. When they discover their entitlements, their incentive to accept employment at given wages will diminish. Again, businesses and private people continue to economise on labour. Technological change will reduce employment in particular activities. Ownership of consumer durables has become so widespread that in

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many directions further home demand must be largely replacement demand. Such developments, including automation, need not lead to more unemployment in an adaptable economy, but they will do so in one resistent to adjustment.
In the foreseeable future substantial and lasting reduction of unemployment must wait upon major changes, even radical changes in taxation, the social security system and the organisation of the labour and housing markets—changes designed to promote both great adaptability in the economy and also more labour-intensive patterns of production and consumption.
The required changes may well be politically impossible. If so, we must resign ourselves either to continued heavy unemployment or to moving back to a regimented economy with wage, price and exchange controls and, perhaps, direction of labour. To expect otherwise is to ask for the moon made of green cheese.
6.3 p.m.
Lord Molloy: My Lords, I should like to join with others who, quite rightly, have already paid compliments to my noble friend Lord Murray of Epping Forest for his considerable and, if I may say so, learned maiden speech to your Lordships' House this afternoon. I should also like to say, and I think that it has to be said, that what I find remarkable about this debate is that we have had similar debates to this one over the past four years in this Chamber. We have had similar speeches and they all have said, in much the way in which the noble Lord, Lord Bauer, ended his speech, that they are sure that what the Government have now proposed is going to ease the situation in unemployment; while the truth is that every time we have a debate like this, emanating from some Government Statement or Budget, with all the same speeches applauding it, up goes the level of unemployment! Let us hope that it does not happen this time.
I must say that in those applauding speeches that we have had, the Government can rely upon the support of the noble Lord, Lord Marsh. I am sorry that he is not in the Chamber. He made quite a number of constructive points, and as everyone knows he knows more roads to Damascus than any other practical politician today. Nevertheless, he is our own beloved Vicar of Bray. The fact is we are examining whether or not this Budget will reduce unemployment; and other Budgets and other White Papers are nothing to look at: because every time we have had a Budget or a White Paper from this Tory Government the result has been a considerable increase in unemployment.
I am bound to say that I should like, at least because of my natural Socialist confelicity, to congratulate the Chancellor of the Exchequer because he has relented at least with the changes in capital allowances on scientific and short-life investment goods. I think that that is a good thing. The changes particularly in national insurance, in the contributions from employers and from employees are also a good thing but it should have been done earlier. And we have got to remember that the Chancellor belongs to the party which put up all these charges by no less than 50 per cent. in 1979—in what was, perhaps, one of the
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contributory factors to unemployment. The Chancellor in his (as it is called) "Budget for jobs"—and I am terribly frightened of that phrase, coming from any Tory—has told us, quite genuinely, I believe, that he feels deeply the scourge of unemployment and the agonies of the unemployed. Yet we have had all this agony, we have had all this pain from previous Conservative Ministers and nothing really has happened except that unemployment has gone up; so that we have had to look sometimes very carefully at what they have been saying in other places.
Let us take, for example, the present Conservative Chancellor of the Exchequer. He says that his policy is to reduce unemployment. I have a document here entitled The British General Election of October 1974. It was written by the psephologists, Mr. David Butler and Mr. Dennis Kavanagh, and published by Macmillan Press Limited. This document examines statements made by various members of all parties, including (and I quote from the booklet):
"Nigel Lawson, the Conservative at Blaby, stated 'the harsh truth' that more unemployment was necessary to beat inflation".
I take it that he himself must now say, "How wrong can one get?" He has to do so. He cannot say in 1974, "Let's have more unemployment and then, when he becomes Chancellor, "Let's have less unemployment".
The fact is that these are the things which some of our people still remember in our universities and technical colleges. They are wondering whether they are being, so to speak, "hooked" again by the phrases we have heard from the present Chancellor of the Exchequer. If the benefit entitlement involved in any Youth Training Scheme is withdrawn from youngsters because they are not suited for that training scheme, that will mean that they will become penniless. This has been done before. It caused a great deal of bitterness in 1937 when young men of 17, 18 and 19 years of age were angered at what had happened, and in 1939 they were being put into khaki and called up to defend their country.
I think that we have to consider these things. We should not do this sort of thing. I hope that, unlike the Conservatives of those days, the present Conservative Party is not of that particular mould that shrinks from principle, disavows progress, offers no redress for the present and makes no preparation for the future. I also believe that any Government which exempts unfair-dismissal claims for workers with less than two years' service and for that now to be extended from small businesses to all employers really means that this law-and-order Conservative Government are now backing possible cheaters who will unfairly dismiss people.
If I may say so to the noble Baroness, this is also what ordinary people are very angry about. We talk glibly about "the unemployed", who are these people? Never mind theories on economics that we heard from the noble Lord, Lord Bauer. What we have to understand is that our unemployed consist of young doctors by the thousand, nurses, midwives, skilled artisans of high calibre, skilled labourers and craftsmen of the engineering, shipbuilding, construction and service industries. In addition to that, we have the teachers in our universities; for example, in the University of Salford, which served these great

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industries and is now being savaged by the cuts that are being inflicted upon it by this Government. That is what we have to understand by unemploment. It is not so much all the great theories, but the real people involved: the doctors, the nurses, the artisans, the people who count in this country who, with management, are the only ones who can solve the problems that we face.
I believe, too, that the Budget has done an almost immoral thing. In this difficult age in which we live it ought not to have done that because it cannot help. Basically speaking, as Mr. James Callaghan said in another place, one of the quintessentials of this appalling Budget is that it provides tax cuts for the rich and wage cuts for the poor. The Chancellor of the Exchequer says that we are on course. We have more unemployment, more bankruptcies and not very good production. The National Health Service is in danger, the teachers are in disagreement, the ship of state, which is on a Tory course, applauded by the noble Lord, Lord Bauer, is headed right for the rocks; and that is a fat lot of good for anybody. Let me add immediately, speaking parenthetically, that that is acknowledged by leading members of the Conservative Party both in this House and in the other Chamber. Deliberately or otherwise, this Government over the past five years have subscribed to the adage that folly is often more cruel in consequence than malice can be in the intent.
There is a great need for change in our country, and we must adopt the language of priorities. If that is to be really understood, we have to start by getting rid of this Government, realising that their policies have not merely failed but increasingly, year in and year out, have worsened the situation. Monetarism was followed by all the curses that arise from it, and then we were led to believe that the dogma of privatisation would help. It has failed ignominiously. Therefore, to praise the Government and the Chancellor when the country is sliding into recession is to admire the statesmanship of those who apply more lubricant to the slope which we are sliding down.
There is another example of unemployment of which I think we should take full cognisance, though I do not think it would ever happen in our country. That is why I say immediately that all the faults that afflict our nation are not necessarily those arising from bad management by the Government. There has been a world recession; there have been many things beyond their control which have afflicted and harmed our nation. But let us always remember this: when you had massive unemployment in some parts of Europe, it resulted in the takeover, in one instance in 1917, by an authoritarian government which is still there; then again in 1936, via the ballot box, by another authoritarian government. That government thought that one way of getting rid of unemployment was by gassing to death about 8 million people that they did not approve of being born. Therefore we have to realise that we must help Europe and stick to our alliance with the United States. We must work together much more sensibly than we have done in the past.
We have tried various methods in order to resolve this problem, and I have read very carefully the most erudite speeches made in this Chamber by men and
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women of great knowledge. I have studied those speeches and the recommendations made by the noble Lord who is to wind up this debate for the Government. I find them informative, and they have helped me to understand. But I also believe that in so far as we have all gone through this before, we should not too lightly disregard what Keynes and the Canadian-Scot, Galbraith, did when their recommendations were adopted by Franklin Delano Roosevelt. If I may say so to the noble Lord, Lord Marsh, they performed that miracle within three years. Perhaps he had that in mind. In the first year the unemployment figures came down by just a few million, in the second year it was much more. The economy in the United States picked up and we followed a similar pattern in our country. We have gradually got rid of unemployment, though not totally. But we made a massive contribution in getting rid of unemployment by some reinflation and by accepting the principles of Galbraith and Keynes.
I believe that, with certain modifications, if we at least examine what was done by those two economists and the manner in which their propositions were put into practice by the greatest American President of all time, in my judgment, we will see that it would not do our country any harm whatsoever. I believe that the Government and the Official Opposition ought to get down and examine these issues, so that we can cure the one thing that is the deadliest cancer in our nation today—unemployment.
6.17 p.m.
The Earl of Onslow: My Lords, the noble Lord, Lord Murray of Epping Forest, does us a disservice, and the disservice he does us is in arriving so late in this Chamber. I suggest to your Lordships that it would have been better if we could have had his words of wisdom and speeches of the quality he has made today over the last 10 years—because this, in my humble opinion, is where the head of the TUC should be. He should be in this Chamber so that he can give his advice and consent to the Government of the day.
I was deeply moved by Lord Molloy's emotion, and I was deeply unimpressed by his logic. His feelings were totally genuine, but his solutions, I suggest to your Lordships, were illogical. I am going to concentrate on one factor, and one only: that is, the undertaking given by my right honourable friend regarding tax reform. Unlike the noble Lord, Lord Barnett, I do not think that Green Papers are unwise. I think it is a wise path down which to go—the path of consultation, discussion and care—because the personal tax system is in such a mess at the moment. It is said that the argument had already been won. It is said that it is dotty and that the present system is wrong, half-baked and unfair—and I am going to show to your Lordships some of those dottinesses and unfairnesses.
The dottinesses and unfairnesses I refer to have not, as your Lordships may suppose, been written by my eight-year-old daughter: they are actually quoted from the document which I have here, which is entitled, Department of Health and Social Security—Tax Benefit Models. I open it literally at random and I come across a page which refers to unemployment benefit in the form of total income support for a man

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who was earning £62 per week before he was made redundant or unemployed. He has four children aged 3, 8, 11 and 16; and his total income support is £106·78, when he was earning £62 per week. However, if he had been declared redundant when he was earning £119 per week, his total income support would be £81·74.
Taking a married couple with one child aged 3, where the husband had been earning £66 per week, he would now get a total income support of £61·58. But if he had been earning £90 a week, his new benefit would be £52·71. Anybody who constructed an unemployment benefit scheme like that ought to be carried away and put on a funny farm. I am not saying that anybody has constructed it. I am just suggesting to your Lordshps that it has grown up like Topsy—and, my God, it is turvy!
I now come to the question of wages and what is called total income support and the marginal changes in income. These are November 1984 figures, so you have to add £1·73 to the total income support figure until November, because the tax systems change at a different time from the social security system, so there is always a lovely hiatus between April and November. Again, if you are a married couple with three children aged 3, 8 and 11 and you were earning £40 a week, you get £83·54 in what is called total income support; if you were earning £109 a week, you get £93·71; and if you were earning £146 a week you get £99·21 to take home.
Can we honestly suggest that a system like that is anything but unjust, unfair and totally ridiculous? It is rather fun reading this document. One could go on reading it forever, and it gets more and more ridiculous. As I said, this is not me: this is the Department of Health and Social Security. A married couple, with two children earning £62 a week get £81·97, and when they get to £98 it goes down to £79·77. I could go on with this for a very long time.
By far the most important thing that this Government can do is to rearrange matters and get our tax and social security systems on a personal level operating in a right and fair way. I think that we spend about £11,000 million on thresholds; we spend £9,300 million on housing relief of one sort or another; and we spend approximately £5,000 million on pension fund relief. That adds up to about £25,000 million. On top of that, we have other social security benefits. Surely, these social security benefits have got to be transfer benefits, and they must go to people who really need them. We must have a system whereby if you earn extra money you get extra pay. You do not want a system whereby a man can have a 100 per cent. inflationary wage increase which does him no good at all. All it does is to bust his company and put the Chancellor's public sector borrowing requirement out through the window. We must do something about this; and if my right honourable friend the Chancellor can get this right his successors will deserve to take Nigel Lawson's Despatch Box into the other place on Budget Day, and not William Ewart Gladstone's.
6.23 p.m.
Lord Graham of Edmonton: My Lords, I should like to begin what I have to say by echoing what has been
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said from all sides of the House to my noble friend Lord Murray of Epping Forest. Like many noble Lords on this side, as well as on the other side, I have known my noble friend for many years. What he demonstrated in his first speech to the House is that he brings to this Chamber an authority, a stature and a respect for the calling that he has followed; and he has served not only his employers, but also the nation so well for many years.
I took careful note of two or three of his points. He stressed the unacceptability to a civilised nation of looking in the face an unemployment total of between 3 million and 4 million, and said, "This cannot be allowed". Surely that is a theme which we should echo throughout this debate. He said that there must be a better way. He was careful to say, as are most of us, that he is not certain what is the better way. But there must be a better way, there must be an alternative. He also acknowledged that it is a tough job and that this Government, or any other Government, will not have it easy; which was fair.
But he then used two words which I noted quite carefully. If there is a way out, it must be found collectively and we must do it together. The job of the Government in constructing their Budget and in helping to run the affairs of the nation means constantly coming back to the theme: how can we do it collectively and how can we do it together? I certainly look forward very much to hearing my noble friend Lord Murray again in this House.
My noble friend Lord Barnett presented a very fair critique of the Budget. He did not use extravagant language, and he brought to his contribution his experience in another place and in the outside world. He posed a number of questions on which I and others await with a great deal of interest the words of the noble Lord, Lord Young, at the end of the debate.
Normally the Budget is awaited with bated breath by ordinary people, by business and by industry. It ought to have the ability to inspire and it ought to be relevant. I have to say that this was an uninspiring Budget and it was irrelevant to the major problem of the times, which is unemployment. In this Motion we are talking about the Budget and about creating employment. We are talking about the statement by the Chancellor, which has been challenged more than once, that this Budget, like last year's, was a Budget for jobs. My noble friend Lord Barnett amply demonstrated that no matter how many other jobs we create—and I look the Minister straight in the eyes and acknowledge that additional jobs have been created—if, in creating 400,000 or 500,000 new jobs, we lose, allow to be lost, or lose to the nation, 600,000 jobs, then we are losing that race. I say two cheers for the Government and the Minister for those elements of the Budget which are genuinely constructive, such as the attempt through national insurance contributions to reduce employers' costs so that they can take on more labour.
I attended a meeting of the Enfield and District Manufacturers' Association, of which I have the honour to be president. That was a few days after the Budget and I asked them whether it was a Budget for jobs. The noble Baroness, Lady Carnegy of Lour, said that ordinary people will come to appreciate that this is a good Budget, and we are looking at this Budget

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strictly from the aspect of jobs. There were at the meeting representatives of large manufacturers, and small ones, such as Thorn, Cryoplant, and Belling and Lee. I asked them to tell me whether it was a Budget for jobs, but they were very disenchanted. They could not say immediately whether or not it was. To be fair to them, I said that we should leave it for 12 months and before the next Budget I would come back and ask them, in all honesty and candour, how many additional jobs had been created as a result of the measures in the Budget. I shall come back to the House at another opportunity and report, and also write to the Minister and tell him about this matter.
It is quite disgraceful that we have a Budget which is paying out to people who want to work £17,000 million not to work. The Government's priority is wrong. Their priority has been to cut income tax, but they should have given a higher priority to cutting unemployment. Like other noble Lords, I read with interest in the Sunday Times last week the report from the Institute of Fiscal Studies. It observed that under this Government between 1979 and this year middle managers were 10 per cent. better off, senior managers were 22 per cent. better off, and company directors were 35 per cent. better off. Under this Government those who are in work are better off than before, but those who are now unemployed are 18 per cent. worse off. It says something about the priorities of this Government that they are doing insufficient to get people back into work and more to reward those people who are already in work.
The Budget is deficient. There is scant hope of job creation. Although the Budget is not bereft of job creation measures, it offers scant hope for industry and for Britain's future prosperity. The Chancellor himself said that he can see no prospect of cutting unemployment totals for the next two years. What a devastating thought that must be for many families, who must go to bed night after night thinking to themselves that whoever else might get a job, the Chancellor does not believe that 3 million or 3½ million people will be returning to work now.
Reference has been made to the ambiance in which unemployed people have to exist. Part of the Government's policy is to attack local government expenditure. This is relevant to the Budget because the Treasury controls this, as it does most other things. At the same time as rents, rates, lighting, heating, gas charges and mortgages are going up, there is the dead hand on the hearts of the 4 million families who are out of work. It is a budget that seeks to make the rich richer, and in so doing it is making the poor poorer. That is wrong.
We have not only record unemployment—and this is a Government for records; we have also a record number of business failures. Last year 13,600 businesses were declared bankrupt. It may be difficult to interpret that statistic, except to say that that total is three times as many, as the comparable figure for 1979. That says something about the spirit and the climate in which the Government are operating. The Government may argue that the businesses which cannot survive in the climate they are creating do not deserve to survive. I certainly would not agree with that; for the first time in our history we are actually
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importing more manufactured goods than we are exporting. This is all part of the record that needs to be scrutinised.
I have already referred to the speech of the noble Baroness, Lady Carnegy of Lour, who wondered what ordinary people will do. A public opinion poll was published in the Standard last night. When public opinion polls do not suit us we say that we do not pay much attention to them. But so far as I am concerned, this particular public opinion poll is a smashing effort and I shall take every notice of it. It is headlined:
"Budget and pit peace lead to 8 per cent swing".
The report begins:
"The Tories lost many lukewarm supporters on account of the Budget".
It concludes:
"Now that the miners' strike is over public concern has concentrated even more emphatically on unemployment".
Those may be false conclusions, built on a false premise by the pollsters and on the responses made by those sampled. I am sure that, like myself, the noble Baroness will wait longer than just a few days after the Budget before utterly condemning it. But those are the views of ordinary people at this time.
The House is entitled to ask what a Labour Government, faced with the same situation, would do. My right honourable friend the Leader of the Opposition has spent some time—not only yesterday and today, but in the past also—demonstrating that there is an alternative. It is not an alternative the Government would embrace and it is not one that noble Lords opposite would embrace. But it is certainly one which my noble friend Lord Barnett on the Front Bench advocates very strongly. It is that there is a range of ways in which money, whether or not it needs to be borrowed, can be used to provide employment for not just 200,000 or 300,000 people, but for I million people. If that many people could be put back to work, it would have a substantial effect.
I wish to spend the time I have remaining in making reference to the disgraceful suggestion that wages councils are to be abolished. They are candidates for abolition. There are 3 million people who have these councils as a last resort, when faced with employers who may wish to screw the last penny out of them; 3 million people working in, for example, shops, catering, clothing manufacture, laundries and hairdressing. They rely upon the ultimate defence to their dignity and their pocket provided by wages councils' orders.
Why are the Government choosing to listen to whoever it is they are listening, and why are they saying that the abolition of a minimum wage of £71 in the case of a shopworker or £65 for a fully qualified hairdresser will of itself do a great deal for the economy? The Minister knows that members of his own department who attended the Select Committee in another place three weeks ago were unable to produce any evidence of a reputable nature to suggest that abolition of the wages councils will result in jobs.
The Government are hooked on scapegoats. At one time the blame was laid on foreign competition. Then everything was the fault of the trade union movement. Now, apparently, it is the wages councils which are to blame. The Chancellor says that wages councils will destroy jobs.

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At present the average wage for men and women is £172 per week. The Chancellor and the Government now say that as part of their strategy they will take away the prop that protects those people who, because of the nature of their skills and ability, can command wages of only £65 or £71 per week.
The CBI, whose views ought to be respected by the whole House and certainly by Members opposite, said, by 3 to 1, that they do not want to abolish the wages councils. When the Institute of Directors was surveyed 93.5 per cent. of its members did not even bother to respond as to whether or not they wanted the wages councils.
The doors are not yet completely closed and I ask the Minister to examine this matter again in the meantime. When it comes to deregulation, the Auld Report, upon which the Home Secretary has yet to give the Government's definitive view, is quite clear. I have a copy of it here, but time is going to beat me. The report says that lower paid workers—and it mentions shop workers, with whom I identify myself through the Union of Shop, Distributive and Allied Workers, in this context—need the protection of wages councils because there are employers who, if they can, will employ people at £68, £64 or £62 per week. Is that the kind of economy and morality in which we want to see this Britain of ours going forward?
My time is up, my Lords. I honestly believe that the Budget presents no hope for those already suffering far more than they ought from the sticks and stones of life itself. They need some support. In my view the Budget gives very little hope to those who were looking to it for help and guidance.
6.38 p.m.
Viscount Massereene and Ferrard: My Lords, I wish we could get this figure of 4 million unemployed right. In my view the figure is more like 3 million. One has to remember that out of that 3 million, as any civil servant in the department will tell you, there are always 500,000 or 600,000 people who cannot be employed for reasons of health, or because they are alcoholics, or for other reasons of that kind.
As we all know (and I can introduce noble Lords to plenty of them) there are many moonlighters. I know of one or two but I will not give their names. They run lorries and yet still draw all the benefits. I reckon that the true number of unemployed is not more than 2 million. Of that number the majority are temporarily unemployed. The permanently unemployed, I believe, total just about 1 million, although that figure varies from time to time.
I should like to congratulate the noble Lord, Lord Murray of Epping Forest, on his very good maiden speech. I should add—although this has nothing to do with him and it is not the position today, really—that for some time some unions (although not the union of which the noble Lord, Lord Murray, was a member, I am sure) were responsible for forcing wages up high above levels of productivity. Let us take the years 1970 to 1979. As I have said before—I can quote the figures in my sleep—wages went up by 400 per cent. and productivity by only 9½ per cent. But we are not in that position now. The position is much better and we are far more competitive.
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I liked the Budget. It is a cautious Budget; and so it ought to be after the most appalling coal strike that we have ever had in our history, lasting almost a year, and the extraordinary antics of the dollar, although the dollar, I think, is probably over-valued by 30 per cent. We have also had a weakness in oil prices and we are, as we all know, the sixth largest producer of oil. Any Chancellor having to cope with such problems would have presented a cautious Budget. In spite of that, we have had 2½ per cent. growth in the GNP. I am quite sure that if we had not suffered from the very damaging coal strike our growth would have been, I should estimate, 3½ per cent. or perhaps even 4 per cent.
I admit that unemployment is still high. It is an absolute curse and frustrating, and, for those who want to work, it must be absolute hell. I know quite a few people who are unemployed. But it is no good, as the noble Lord, Lord Marsh, said, going back to the old way of inflating the economy and borrowing thousands of millions of pounds to embark on vast schemes which provide only a temporary cure. Such schemes will make the Government popular for a short time but we must keep to sound money. If we inflate the economy too much we shall not have sound money and we cannot make sound jobs. This is all nursery stuff which your Lordships will know, but do not always say. I feel that I must say it.
I congratulate the Government on inflating the economy slightly and for a very good cause: the Youth Training Scheme. They spent £2½ billion last year on special employment and training measures. This includes the Youth Training Scheme, which I understand is the most extensive training programme ever seen in Europe. I think the Government deserve a feather in their cap for that. The noble Lord, Lord Barnett, complained that unemployment had increased by 130,000 in, I believe he said, the last few months. But the noble Lord must remember that last year the working population increased by 160,000. Therefore, the Government have to find an extra 20,000 jobs per month to stop sliding back on unemployment. That factor must be taken into account.
I have always been a small employer—or, rather, not always, of course, because I was not an employer when I was young—and I have been in only one public company, which was involved with shipping, where one did not have to find the wages oneself. I have always been the poor individual who had to pay the wages in my own businesses, and sometimes it can be very awkward on a Friday. With due respect to the noble Viscount Lord Chandos—I understand that the noble Viscount is the son of Oliver Lyttelton, the late Lord Chandos, who was a great friend of my father (I believe they were both in the same regiment, though that, of course, has nothing to do with the debate)—I do not think that he is an employer, but perhaps I have misunderstood him.
If you inflate too much to create employment it is rather like giving a dog a bone in a dish which has a mirror at the bottom. To me it is immoral and dishonest because you are spoofing the public and you cannot spoof the public all the time. I do not want to be party political because I am not a party political person, but we need only go back to the days of Mr.

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Callaghan and even Mr. Heath. They both printed a lot of money. Mr. Heath did not have to bring in the International Monetary Fund, although Mr. Callaghan did. He may not have had any option, which was his bad luck. However, it is not the thing to do. As I have already said, the only sphere in which it is permissible to inflate the economy, in my view, is in training the young and trying to do something about the long-term unemployed. I understand that the Government are now arranging for 100,000 extra places in the Community Programme for the long-term unemployed. That is a step in the right direction. In addition, Her Majesty's Government are doing much in the sphere of new training schemes for the young.
As an employer, I welcome the restructuring of the national insurance contributions. I have always had a hell of a time as an employer. I have always said that you can only wear so many suits, you can only eat so much and you can only drink so much. What do you do with the rest of your money? You can go on holidays all round the world; but I do not like that, so I use my money to employ people. It is a great pity that more people—but I will not continue in that direction.
As regards the wages councils, I agree that we do not want to have sweat shops. I have not been pro-wages councils because I have no knowledge of shopkeeping or sweat shops. However, I should feel far happier if there were a few people on the wages councils who had paid wages during their careers. The members of the wages councils may be very learned in their own sphere but they have no practical experience of paying wages. If we are to keep the wages councils—I understand they are to be curtailed or even abolished—it would be an excellent idea to have some people on them who have had to pay wages.
I understand that some noble Lords opposite are very annoyed that 8.5 million people who earn less than £130 per week are to cost £900 million less through the restructuring of national insurance. I do not see why they should be annoyed about that. One or two noble Lords have said that no employer will take on an extra man just because he can get him £3 cheaper. I do not agree. It is a help. I understand that 800,000 people will cease to pay tax because of the increased personal allowances. Surely no noble Lord opposite can object to that. (I shall sit down in a moment. We are allowed 12 minutes, are we not?).
The Budget will definitely encourage employers to employ more people and has also provided an incentive for the unemployed perhaps to try a bit harder to find a job. I do not think that some of them try very hard. I would pin great faith on small businesses, although I know that the noble Lord, Lord Alport, thinks that they are quite irrelevant. In this day of the microchip, the silicon chip and computers, I am convinced that the days of vast great factories employing 10,000 people or more are over. I think that the emphasis must be more on the self-employed and small businesses.
I know that the noble Lord, Lord Alport, is not here, but while I am on the subject of computers, he was right in saying that we should buy British goods, but he also brought up the question of the Japanese. The Japanese have started quite a few factories in Scotland, and a lot of these computers and other things the
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public buy here are made in this country. Perhaps the noble Lord was a bit hard on the Japanese. Also, we all know if we stop exports coming here from other countries, that is a two-edged sword.
I see that I must end now, though I could say a lot more. If only bureaucracy could be a bit easier on small businesses. In this country the amount of bureaucracy involved in starting anything or doing anything weighs one down, However, I know that it is worse in Brussels. I made quite a few speeches on the Common Market before we went in. I said. "Beware of the bureaucracy in Brussels!" It is appalling and pettifogging. There are the most absurd regulations.
I shall now sit down. I should like to congratulate the Government on their Budget. I think that it is a good and a sound Budget, although it is not an exciting Budget. After all, if you are in Government, you should not gamble. You have to be cautious and sound. I think that the Government have been cautious and sound.
6.52 p.m.
Lord Kagan: My Lords, I wonder whether the premise upon which this debate is based is correct. A Budget under one Administration may produce a slight tail-wind and under another a light uphill rise in front of the economy, but a Budget's influence on, and indeed relevance to, employment is marginal and peripheral. Generating employment depends on industrial attitudes, backed by incentive policies. It depends on efficiency, on innovation, on investment, on entrepreneurial skills and, above all, on the harmony between management and labour. It depends on identifying and pursuing joint and agreed objectives. We have seen it succeed in Germany and in Japan. This is where we fail, and this is where we have to seek the solution.
I feel that history may give us two choices. One is to embrace and adopt wholeheartedly an incentive orientated economy, pursuing efficiency and geared to wealth creation, and thus generating the resources to sustain the compassionate society and the Socialism of the Methodist Bible. We must subordinate the pursuit of equality to the pursuit of equality of opportunity. The two are not the same.
The other choice which may be open to us—or, indeed, the situation in which we may find ourselves—is a controlled, closed market society, or indeed a Marxist society. But the in-between, indecisive compromise that we are practising attracts the worst of both systems and may result in a fair and equal distribution of misery, as Maoist China and Stalinist Russia have discovered. But China and Russia are turning back. Indeed, they are endeavouring to make a U-turn back to the incentive economy.
I well remember, when in Russia, talking to a director and pointing out to him the inequalities of pay and living standards in his factory. He said, "Ah, comrade, for good intentions you get rewarded by the Lord in Heaven: in this factory down here you are paid by results". That is Communist Russia.
What happened in post-Mao China we all know, but may I draw your Lordships' attention to something that is happening in Hungary? It is an interesting

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development. Hungary is encouraging private enterprise. It is de-centralising and encouraging innovation and private initiatives—presumably with the blessing, and certainly with the full knowledge, of Moscow. It has produced a completely new class of affluent people.
Brand new Mercedes-Benz and BMW cars with Hungarian number plates, legally owned by Hungarians, are creating traffic jams in Vaci Street, the Bond Street of Budapest. In the same street is a high fashion shop which is privately owned now and called, significantly, Clara Rothschild. It is full of critical customers buying fairly exclusive and expensive foreign clothes. A few doors up is the Ofoteli camera shop, which sells expensive Japanese cameras—Canon and Nikon—and which is constantly short of supplies. The price of a camera is five times the average monthly wage of a worker in a factory.
Inevitably that has attracted criticism from certain sections of the Hungarian press and from certain diehard Marxists who consider it, quite logically, unfair, unequal and un-Marxist. The response came from no less than Comrade Jaros Hoos. Comrade Hoos is one of the chief government planners. He is a full member of the Central Committee of the Hungarian Communist Party. One can hardly go higher. His response was—and here I quote:
"We must not, and we do not want to, create an atmosphere in which people who are productive and thus earning a lot of money could feel that their activities are not desired or welcome".
That is today in Communist Hungary—and Hungary still has no income tax and certainly no progressive income tax.
While China and Russia are groping their way back to an incentive economy, we are weaving our way uncertainly between a somewhat confused socialism and a hesitant capitalism. In Yorkshire we sometimes discuss these matters, and I am very frustrated by the hardened attitudes we find there. Sometimes, as an employer in this country one feels as if one is called upon to run a church under atheist management.
What of the future? Management and labour must find common ground. They must identify common objectives, and the objective surely is prosperity for all. It is the duty of Government, it is the duty of the unions, and, indeed, I believe it is the duty of the Opposition, having once identified the common objectives, to encourage them and to bring them to reality, and indeed to encourage a merging of approach. On the factory floor and even in Parliament—and even in this House—I feel we should not oppose for the sake of opposition. The reward might be that when the opportunity arises for a future Labour Government—and I hope through the ballot box—to become the new tenant of 10 Downing Street, they will inherit an economy worth having, in which they can be successful and certainly keep their promises.
Perhaps I may come back for one minute to unemployment. Of course, unemployment is a danger and it is a scourge, as the noble Viscount said earlier. Efficiency temporarily increases unemployment. This is unavoidable. Modern technology saves manual work, and modern electronics saves mental labour.
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There will inevitably be fewer jobs and more highly-trained people who find themselves in them and who find themselves better paid. However, the answer to unemployment is not necessarily jobs for the sake of jobs. It is useful activity, and the useful activity can only be financed by a successful economy.
Perhaps I may come to the question of wages councils. I think we should give this a lot more thought before we turn it down. Marie Antoinette once said, "Cakes we haven't got; bread isn't good enough: let them starve". The wages councils prevent cheap labour. But they may decrease the entry into the factories of certain people. We should be very careful indeed before we decide to retain or abolish them.
7.3 p.m
Lord Rochester: My Lords, we are drawing near to the end of the debate and I, for one, have found it most instructive. In the time available it may be best that I should not comment, except incidentally, on what has been said by other noble Lords but endeavour to make my own contribution to it. At the start of his Budget Statement, the Chancellor reaffirmed that the Government were determined to defeat inflation and to do what they could to combat the scourge of unemployment. In his view there was no conflict between those two objectives and he said that the Budget therefore had two themes: to continue the drive against inflation and to help create the conditions for more jobs.
We on these Benches have always been prepared to give this Government credit for their success in reducing the rate of inflation. I gladly do so again now. Moreover, I have never been among those who say that the Government deliberately set out to create unemployment as a weapon with which to control inflation. Equally, there is no doubt in my mind that unnecessarily high unemployment has been the inevitable effect of their policies. Therefore, the fact that the Chancellor has now reaffirmed the Government's determination to maintain and even to intensify their present monetary policy gives me no comfort at all.
In the White Paper on unemployment, the biggest single cause of high unemployment is attributed to the failure of the jobs market. It is said that management, employees, and the education system, working in common understanding and partnership, have together to ensure that the supply of labour meets demand in quantity, quality, cost and flexibility. Apparently, there is nothing that the Government themselves contemplate doing except on the supply side where, as we have heard, they propose, among other things, to expand the Youth Training Scheme and the Community Programme. Already today, in response to the Statement repeated by the noble Lord, Lord Young, I have made plain my view that I warmly welcome both those measures.
However, the Government also propose to remove so-called legislative impediments in relation to claims for unfair dismissal and to the operation of wages councils. Reference has been made to the subject today. I understand that there will be an opportunity in two weeks' time to debate the matter in much more detail and I do not propose to say much about it this evening. In my view, there is a case for the reform of

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wages councils in terms, for example, of the percentage of the adult rate now payable to young people. However, I think I should give notice that we on these benches would certainly oppose any move completely to abolish them.
I very much doubt whether a widespread reduction in earnings that are already too low would do much to increase the number of full-time jobs. In that respect, I agree very much with what the noble Lord, Lord Graham of Edmonton, had to say. Rather in contrast to the very considerable tax reductions accorded over recent years to those enjoying high incomes, I fear that such a move would be widely perceived as unfair; and, by encouraging unscrupulous employers—and there still are some—to reproduce the unacceptable working conditions that wages councils were set up to eliminate, existing tensions would be exacerbated. I fear, too, that, since it cannot be assumed that the next Government will be a Conservative one, excessive change in this area would quickly be reversed by a different Administration and thus produce instability in a field which in my view cries out for consensus.
Living in the North West, as I do, I am truly troubled by the present divisions in our society between rich and poor, employed and unemployed, and between North and South, and so are Church leaders. So also, it now appears, are the CBI, who, in their search for more social and industrial stability, propose that their members should lobby for far-reaching constitutional change, including proportional representation and a more formal consultative mechanism between Government and business. Indeed, the president of the CBI wrote in a foreword to a document published last week, to which reference has already been made, Change to Succeed:
"If the free enterprise system in the North of the country means 20 per cent. unemployment in some areas, then it"—
that is, the free enterprise system—
"inevitably comes into question".
It is the same need for stability which in this instance, by making exchange rates less volatile and thus facilitating business planning, has now caused the CBI to advocate that we join the European Monetary System. That is a course which, on both economic and political grounds, we on these Benches have advocated for some time, and most recently this has been done this afternoon by my noble friend Lord Ezra. I feel sure that, in the long run, it would contribute to a reduction in unemployment by improving our industrial performance particularly in the European market.
There is one point about the Budget that I should particularly like to welcome. It relates to a debate initiated by the noble Lord, Lord Terrington, six weeks ago when I referred to a survey of attitudes to profit sharing and to employee shareholding carried out by the Industrial Participation Association. An analysis of the responses to that survey showed that, whereas in companies where employees had a choice between taking their bonus in cash or in shares, 80 per cent. currently choose cash, the number choosing shares would probably double if the seven year period before shares were free of potential income tax liability under the provisions of the 1978 Finance Act were reduced to five years.
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I could not refrain on that occasion from reminding the House that those provisions were introduced as a result of pressure from the Liberal Party at the time of the Lib-Lab pact. I went on to suggest that if this particular seven year provision could be modified in the Budget, it would give a real stimulus to employee share schemes generally. I gladly congratulate the Chancellor on having done exactly that. I do not suggest that this was simply a response to my words. I am sure that it was not. But, in my view, the encouragement of such schemes, which featured in Section 1 of the 1982 Employnment Act, which we on these Benches were instrumental in getting placed on the statute book, is a fruitful means by which employee involvement can be increased, thus improving our competitiveness and creating more job opportunities.
On a number of occasions in recent debates, my noble friends have called for some limited additional capital expenditure on the country's infrastructure. Again, that has been done with great force this afternoon, it seems to me, although I may be biased, by my noble friend Lord Ezra. In that respect, I find myself much more in agreement with what the noble Viscount, Lord Watkinson, had to say than with the thinking of the noble Lord, Lord Houghton of Sowerby, much though I always respect what he has to say. In reply to that suggestion, it has been said among other things on a number of occasions that, given recent advances in technology, this would not create many more jobs because the work involved would not be nearly as labour intensive as is claimed. That argument, I suggest, is wide of the mark. Expenditure, for example, on our outdated road system, particularly where it leads to East Coast ports, would surely bring in its train trading benefits and, by increasing productivity, improve also the prospects for further job creation in future.
Another criticism of such proposals is that they would restoke the fires of inflation and ultimately lead to wage costs per unit of output—already higher than those of our main competitors—rising still further. I take that criticism very seriously. The Chancellor, in his Budget statement, said at column 791 of Hansard of another place on 19th March:
"Too much of the benefit of economic growth is currently being enjoyed in higher living standards for those in work, too little in the form of better job prospects for those out of work. In a free society, the remedy lies in the hands of those responsible for collective bargaining throughout the economy".
The Government apparently see themselves as playing no direct part in that process of pay determination. It is a proposition that I should like to challenge. In the first place, I do not believe that it is true. In the public sector, pay constraints continue to be based on arbitrarily imposed cash limits. These are understandably perceived by those affected by them to be unfair in comparison with settlements reached in the private sector.
Secondly, on the wider issue of principle, I believe that because it is so essential that increases in wages and salaries should not outstrip improvements in productivity, there is now an urgent need for consultation between Government and representatives of employers, trade unions and other relevant interests. This should be as open as possible and aimed at obtaining wide awareness and acceptance of the

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overall increase in incomes that the country at periodic intervals can afford. A forum for this purpose is already to hand in the shape of the National Economic Development Council. An educative project could thus be set in motion that would rely for its effectiveness not on the fear of unemployment or Government fiat but on an appeal to reason and to public understanding.
Who knows? Such an approach might eventually even lead to some agreed trade-off between pay increases, investment and job creation. I further believe that there is now a strong case for the proposition that where, in the non-trading part of the public sector, more especially in services that are vital to the support of life or to the security of the state, negotiations over pay and employment conditions, when they result in failure to agree, should be settled by a single, independent standing body whose findings could be overturned only by resolutions passed by both Houses of Parliament. I do not underestimate the difficulty of obtaining the consent of trade unions to such arrangements. But, surely, following the collapse of the coal strike, the time is opportune for some imaginative initiative of this kind to be taken by Government in an attempt to break the present pay and jobs log-jam. That would seem to accord with the new realism that was courageously suggested, as I understood it, by the noble Lord, Lord Murray of Epping Forest, before he retired as TUC General Secretary. Here, perhaps I, too, may say how much I admired the maiden speech of the noble Lord. Otherwise, I fear that, as the economy picks up, in conformity with our experience over the last six years, the continuing need to control inflation will be matched by ever-rising unemployment. That, in turn, will be compounded by never-ending disruption in essential services.
One thing is certain. Thinking of this kind, which is by no means original, cannot reasonably be dismissed as an incomes policy that has been tried before and has failed. I believe that it should now be put to the test, for neither exhortation nor collective bargaining that is said to be free but is in reality nothing of the sort, will work. It appears—I have to say this—that it is only the Alliance parties of the various political parties who are prepared to put forward specific proposals as to how this complex problem of pay determination should be grappled with.
7.20 p.m.
Lord McCarthy: My Lords, I have three things to do this evening. First, I must thank the noble Lord, Lord Barnett, for initiating this debate. Second, I must sum up the argument as we see it on this side of the House. Third, I must, like every other speaker who has spoken in this debate (except the noble Lord himself), congratulate the noble Lord, Lord Murray of Epping Forest, on an outstanding maiden speech. It is not surprising that that should be so, because Lionel Murray was an outstanding General Secretary of the Trades Union Congress. If I agree with the noble Lord, Lord Marsh, about only one matter, I agree with him about that.
When the noble Lord, Lord Murray, was the General Secretary of the TUC they used to say that he
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was the finest General Secretary since Citrine. A little fellow from the T and G once said to me that he was actually better than Citrine but that Citrine had Ernie Bevin, which is true enough. The speech which the noble Lord made tonight was typical of him. It had the qualities which made him an outstanding member of the General Council staff in Congress House; namely, the directness, the persuasiveness and the knack of going straight to the heart of any issue. I am sure that we all hope that we shall hear from him regularly and frequently in this House.
So I come to the debate. I think that four themes have run through what noble Lords have said on this side of the House: the state of the economy; the relationship of the Budget to the state of the economy; the consequences of the Budget for employment—because this is, as we have been told repeatedly, a "Budget for jobs"—and whether there is any alternative to the Government's proposals. And if there is, then why is it that the Government are so obstinately refusing to move in this direction?
As regards the state of the economy, I think that we could easily exaggerate the differences between us. We are like a doctor asked to give a second opinion upon a much-loved patient after a long illness which we believe has partly been caused by the faulty medicine and excessive purgatives of the doctor himself. We are glad to be able to say—and there is no disagreement on the different sides of the House—that there is life in the old girl yet. We are glad to be able to say that there is a partial, spasmodic, uneven and extremely welcome recovery. We welcome the fact that there was an increase in total output last year. We welcome the fact that there was an increase in manufacturing output last year, and that investment increased last year. We only wish that it had happened earlier. We only hope that we can go on and see, for example, manufacturing investment getting back to something like its 1979 level or output in manufacture getting back to its 1979 level. However, the recovery—partial, spasmodic and uneven—is very welcome to us. There is life in the old girl yet.
However, a number of points worry us. Two crucial things worry me. One of them is unemployment, to which I shall return. But what worries me also is the basis for continued recovery. Many reasons can be given for feeling concern about the basis for continued recovery. The example which I give comes from the Red Book itself, where the Chancellor sets out the figures in respect of the underlying movement in the balance of payments. Those figures were mentioned this evening by the noble Lord, Lord Barnett. There is a small surplus, but the surplus arises because this is a record year for oil and it is a good year for invisibles. That offsets it's being a bad year for manufactures and a bad year for "other goods".
However, the Red Book also tells us that next year will be a worse year on the balance of payments for manufactures. It tells us that the oil revenues have reached their maximum. Therefore, we ask, "Where is the recovery to come from"? If, in 12 months' time, the contribution of manufacturing to the balance of payments is worse, if the situation in respect of "other goods" is worse, if the earnings from invisibles do not double, and if at the same time it is the peak year for oil revenues, then what will prevent that balance

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disappearing? And if it disappears, then what is the basis for continued recovery? That is the sort of concern that we have, and we do not feel that the Government have an answer for it tonight.
We come to the relationship of the Budget to the economic situation as we see it. Essentially, we are saying that it is irrelevant. The Budget seems to us to be very largely irrelevant. The noble Earl, Lord Gowrie, said that we must not make too much of this Budget. Believe me, that is not a danger. There is not a danger that anybody will make too much of this Budget! The danger is that a Budget which has been labelled a "Budget for jobs" will not in fact increase jobs at all. That brings me to a curious aspect about Government policy; namely, their curious reluctance to specify a figure for unemployment.
We have had this strange White Paper with a blue cover which has been signed by seven Secretaries of State. It is like the scenario for an old B film. Seven editors have produced it, and there is not one concrete proposal. But in this blue paper with a white inside they tell us why they cannot give us a figure for unemployment. They say on page 2 that they cannot give a figure because it is not "pre-ordained"; it is dependent upon,
"enterprise, our adaptability, our control of inflation, our productivity, our wage moderation and our competitiveness".
As if the level of inflation were not dependent on all those factors! As if the level of the GDP was not dependent on such factors! As if the current account forecast, which is in the Red Book, was not dependent on similar factors! As if the level of the PSBR, which was £3 billion adrift last year, was not dependent on similar factors! Yet targets can be given for the level of prices, for the level of the GDP, the level of public expenditure, and so on. But they cannot give us a figure for unemployment because it is dependent upon other variables. The fact is that they could give a figure. It is possible to provide a figure. It is in there, but the Chancellor will not own up to it.
In the Budget the Chancellor proposed an increase in the Community Programme of 100,000 jobs, in effect taking 100,000 people off the register at a very cheap price—about £2,000 per job. That is excellent. What a pity it was not done last year. The Chancellor suggests—and the noble Lord, Lord Young of Graffham, told us about it earlier today—that we apply the YTS to 17-year olds. That would take about 200,000 off the register over two years. It is an excellent idea. What a pity it was not done 12 months ago, when we suggested it.
We then come to two doubtful elements which have been discussed on this side of the House. I am referring to the restructuring of national insurance and to the cut in direct taxes of about £750 million. The London Business School says that the first of those proposals would create 150,000 jobs. I find that inconceivable. On the last occasion, when twice as much was cut off national insurance payments, it did not do much for jobs at all. So far as the tax cuts are concerned, on the basis of the figures that we know—and they can be derived from many studies, not least by the Institute of Fiscal Studies—the Chancellor's net tax reductions should take about 30,000 people off the register. So, all
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in all, the Government expect and anticipate an increase in the employable population of something like 300,000.
That is one of the answers I gave to those who have said that what we are proposing is fantastic, amazing, peculiar, and in particular that what Mr. Kinnock said was amazing and peculiar. He was asking for just over twice as much job creation as the Government plan to do this year, and if the Government had done it last year, and were proposing to do as much again this year, they would be on the Labour Party target. That is the size, the magnitude, of what is being asked for from the Government. But it is not being done, and 300,000 jobs a year, as the Government know very well, will not replace the number of new entrants coming into the labour market. That is why we do not have the figures, because the figures are a disgrace; because the Government know that what they plan and intend is that next year unemployment will get worse. That is why we do not have the figures.
I do not want to talk for any length of time about the alternatives because we have discussed this subject ad nauseam in this House. The situation has arisen whereby, I am pleased to.say—and I am sorry that the noble Baroness, Lady Seear, is not in her place—we have all become Seear men and women. The proposals in the report from the Select Committee of the House of Lords on Unemployment have become the established policy of every opposition party and the CBI as well. Indeed, many people on the Back Benches of the Conservative Party propose the same. It has become the considered policy of virtually everybody except the Government Front Bench; that is to say, to provide a million new jobs in a period of about two years at a gross cost of £5 billion and a net cost of about half that sum—just about the overshoot of the PSBR last year. That is our alternative policy. It is an eminently practical and reasonable policy, and the main reason that the Government do not embrace it is that they are totally boxed-in. Or perhaps there is one other reason, and I should like to spend a little time on this possibility tonight.
The Chancellor has this year found a new reason. He says—and he says it in the White Paper with blue covers—that he is now waiting for real wages to fall and that when real wages fall this will automatically reduce unemployment. He said this first when he was speaking to the House of Commons Select Committee on Unemployment. He said that a 1 per cent. cut in real wages extended over three years would give us 1½ million jobs. I said to the House shortly after that that I had never heard of research which justified anything remotely resembling this figure of 1½ million jobs for a 3 per cent. cut in real wages over a period of three years. I was not told what the research was. But now that research has been published, not in Employment—the Challenge for the Nation—there are no facts in that—but in a new publication, a review by Treasury officials called The Relationship between Employment and Wages. I think we have to take it that this publication is the intellectual cover for the Government's present refusal to do anything more about unemployment. Therefore it is worth spending a short amount of time discussing this new yellow paper on the assumed relationship between employment and real wages.

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What it suggests is that there is empirical evidence to show that if only real wages would fall, and if only workers and employers would get real wages down, automatically, year by year, the level of employment would rise. In the meantime there is little the Government can do except abolish wage councils and do one or two nasty things of that kind. There are several points to be made about this contention. The first is that the evidence for it is not visible to the naked eye. To the naked eye real wages rise at the same time that employment rises. That is called, when the Government are in another mood, the miracle of capitalism. It is perfectly true that in some countries it does not happen and it is perfectly true that it has not happened in this country since the late 'sixties. But one does not have to assume falling real wages and a negative relationship between real wages and unemployment to explain the fall in employment in the country since the late 'sixties.
The second point to make is that there is no observable connection between cost-induced wage inflation, in the Chancellor's terms, and what the Government are pleased to call a more flexible labour market. The most dishonest part of the blue paper is an attempt to argue that other countries in Europe and the United States have been introducing similar policies to this country's so as to make their labour markets more flexible. In Annex 3 of the blue paper, on page 32, there is a list of countries such as France, Italy, Germany and the United States where this is said to be so. What it shows is that on the whole those countries have more ambitious job creation programmes than we do. There is no example of a country which has introduced anti-union legislation as we have. There is no example there of a country which has cut back on employment protection in the way that we have. There is no example of a country which proposes to weaken or abolish minimum wage legislation. Yet it exists in all the countries listed to a more effective extent than it does in this country.
Finally, at the end of this document a number of academics and econometricians of various kinds are quoted who have actually sought to establish a relationship between employment and real wages. What they have actually established is an enormously wide variation of results. They have established that in some countries, in some periods, there is a positive relationship or no relationships, whereas in other countries in other periods there is a negative relationship. They have established, for example, variations between 0·23 and 1·75 for manufacturing industry. Yet the Chancellor in his document, insists, at the end, that the Treasury economists say that,
"An elasticity in the region of ½ to 1 is suggested for the whole economy, implying that a fall in real wages of 1 per cent. might produce a demand for labour of between ½ per cent. and 1 per cent".
That is to say, between 110,000 and 220,000 new jobs. To say that is as statistically reliable as saying that if rainfall in April varies from half an inch to 30 inches each day, we can assume that on 1st May we shall get 15 inches of rain. Yet that is what the Chancellor says, and that is the evidence why he cannot do anything about unemployment.
But the danger in quoting academics is that they read what one says and if one misrepresents them, they
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complain. Two of the distinguished academics whom the Chancellor quotes in this document have already complained. They wrote to New Society on 28th February last—Messrs. Leyard and Nickell. This is what they said of this paper which quotes them in support of the Government's policy:
"Despite the Chancellor's certainty this question is, in fact, the most difficult and controversial economic issue at present".
And, summing up their true position they say:
"The Chancellor's assertion that the heart of the problem is the real level of wages is simply wrong, and calls to mind Melbourne's comment about the historian Macaulay: 'I wish I was as cock-sure of anything as Tom Macaulay is of everything'".
The truth is, my Lords, that we know better; the Chancellor is not cock-sure; the Chancellor is desperate. The Chancellor misrepresents the figures because he does not know what else to say. He has no plans in his Budget or in his blue book to do anything because he is locked in by the Prime Minister's prejudices and his own beliers concerning the role of the PSBR.
7.39 p.m.
Lord Young of Graffham: My Lords, I am grateful to the noble Lord, Lord McCarthy, for the way in which he commenced his speech this evening since I wish to follow his example. I should start therefore by saying how grateful I am to the noble Lord, Lord Barnett, for introducing this debate this evening and giving us an opportunity at least to ventilate our different opinions on the way the real world is. Of course, I am less than totally grateful to him for his contribution but I shall come back to that in a moment. Perhaps I may say how happy I was to be here today when the noble Lord, Lord Murray of Epping Forest, made his maiden speech. I have vivid memories of my first appointment as chairman of the Manpower Services Commission when I called on him and of the warm way in which he encouraged me and the enthusiasm he showed for our task. Although I suspect that we may differ somewhat politically, I know that we are united in our determination to see that young people get the right start in life. I welcome him and his future contributions to our debates.
There is not one word with which I would wish to disagree in the last paragraph, page 2, of what has been called the blue paper. Not only the future levels of unemployment but the future of our country depend upon our enterprise, our adaptability, our control of inflation, our productivity, our wage moderation, our competitiveness, and thus our business success. May I finish off that paragraph in short by saying that they depend above all on what we ourselves, all of us, choose to do.
What this debate should be about is the choices which face us as to what we should do and where we should go, and how we should cure the ills and evils of unemployment as we restore the economy to its rightful place, for the objective underlying this Budget is to stimulate enterprise. It is in this context that it is a budget for jobs, and in that it is in the context of the Government's policies since we came to office.
New jobs and new wealth are born from decisions taken by individuals to innovate, decisions taken by individuals to invest, and decisions taken by individuals to compete. This Government are committed to creating the climate in which these

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decisions can be more easily taken and ultimately yield greater results. That, and that alone, is the theme which lies behind Tom King's White Paper on employment published last week. In it he says:
"The key contribution of Government in a free society is to do all it can to create a climate in which enterprise can flourish, above all by removing obstacles to the working of markets, especially the labour market".
That is the reality. We must learn from the past if we are to avoid the painful experiences of recent years. Perhaps I may quote finally from the White Paper the statement which we, above all else, must learn:
"Jobs come from customers and from nowhere else".
That is a lesson to which my noble friend Lord Watkinson referred, and one which we should all mark.
We have heard a great deal about import penetration; about the car market we lost. There was no Government restriction or inhibition of any sort preventing us from buying British cars. It was the customer who decided, and the customer alone, that the quality, the value and design of an alternative product were better, and that we must change.
The White Paper also points to how our less efficient economy has led to lower living standards. That again we must change. We have made a start, but we need to encourage and not discourage the entrepreneur; we need to encourage and not discourage the risk taker; and above all we need to encourage people and not put more obstacles in their way.
If we look round at the general economy we find it hard to recognise it from some of the descriptions that I have heard from noble Lords opposite. Only this weekend the CBI came out with a survey which showed a vote of confidence by business in our economy, and a vote of confidence unequalled for the past 12 years. Theirs is the opinion, theirs is the vote, which I would suggest we should pay attention to, for they are in the front line of business and they are the ones who at the present time really know which way the economy is going, and I suspect should be listened to perhaps more than I.
Lord Graham of Edmonton: My Lords, will the noble Lord give way? The noble Lord has attached great importance to the views of the CBI on that matter. Would he attach equal importance to the view of the CBI on the wages councils?
Lord Young of Graffham: My Lords, I thank the noble Lord. I shall come to that in a moment, if I may. May I just deal lastly with the foundations of the economy by reminding us all here this evening that we live now in an economy which has been growing every year for the last four years; we have inflation now at its lowest level since the 1960s; we have both investment and exports at record levels; and we also had half a million new jobs created in the 18 months to last September.
I am grateful to the noble Lord, Lord Barnett, for recognising the reality that higher pay settlements mean fewer jobs. I appreciate he knows that because it is clearly the product of long and hard experience. I wish more on his side shared his sentiments. But what
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this Government are about is not a low wage society. What we need, and desperately need, is a low unit cost society.
In the past year our unit costs went up by 4 per cent. In the past year the German unit costs went down by 3 per cent., and the Japanese unit costs went down by 6 per cent. That, and that alone, is what the debate is about; about the cost of wages and paying ourselves more. The noble Lord might perhaps scoff a little at Green Papers, but if anything needs a real rethink I suspect that it is our present benefit tax structure. That—as has been pointed out on more than one occasion this evening—certainly does not introduce incentive into our society.
Then we had the noble Viscount, Lord Chandos, who, in a manner of speaking, cycled around the course. He scoffed a little at the effect of reducing national insurance contributions for employers by £3 a week when employing a young person, or an unskilled worker, at just below £90 a week. Noble Lords opposite have scoffed at the London Business School forecasting that that, and that alone, will produce some 150,000 new jobs.
However, I received my first letter on this subject the day after the Budget from a hotelier. He said that having read of the changes he recognised—and he employed about 60 people—that he would take on two new people as a direct result of the national insurance changes. These national insurance changes are different in quality from changes in the past. They are specifically geared towards the low paid, and they are specifically geared to alter the shape of the national insurance structure. When they come into effect—and I have to remind your Lordships' House that it will not be until October that we see the effect of it—we shall see that the London Business School is more correct than some noble Lords opposite.
I am afraid I was absent when the noble Lord, Lord Marsh, criticised the removal of the upper earnings limit. But of course he spends much of his time now in a rather unusual industry. Fleet Street is perhaps a unique case, but there may well be ways even in Fleet Street that can be found to modify the cost of the excess of earnings.
I am afraid that I also missed hearing the noble Lord, Lord Bottomley, who I understand said that unemployment is the worst possible preparation for young people entering the labour market for the first time. That is one statement with which no one in your Lordships' House could possibly disagree. What this Government have been concerned to do, and I believe will be seen to have succeeded in doing, is to seek to ensure that no young person has the opportunity of experiencing unemployment. When the new scheme is in place there is not one young school-leaver in the land who will not have the opportunity of having two years of what I hope will prove to be first-rate training, and for whom unemployment need any longer be an option.
Then we had the noble Lord, Lord Ezra. I hope that in saying what I am about to say I shall not in any way suggest any lessening of my regard for him. This evening he reminded me a little of one of those programmes on television in which the hit tunes of yesteryear are played. How many times have we heard

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the song, "Just give me two billion more, only two billion more"? The facts are that this year capital fixed expenditure in the United Kingdom is £55 billion. In the public sector it stands at the same level in real terms as it was in 1978–79 at £22 billion. We have never had more fixed expenditure. It was up, and it is going to be up again next year.
If we have our present difficulties with unemployment, what difference would another £2 billion make, particularly when we are talking about areas of infrastructure like roads which are more dependent upon town planning and public inquiries than they are about other decisions, and water and sewerage on which we shall spend some £800 million this year? Many of those projects on which the £2 billion might be spent would, I suspect, be extremely good for the plant hire companies but I am not sure what they would do for the hire of men.
Lord Ezra: My Lords, in making those remarks, has the Minister taken fully into account the views expressed by the CBI in its report on the fabric of the nation and the views expressed by NEDO in its recent report?
Lord Young of Graffham: The short answer to that is, yes, my Lords. I have also heard many reports from the contractors and other associations who make a case for more infrastructure, but infrastructure must have its own reward. It must be there for its own sake; not in the cause of employment. There may be good causes for infrastructure, but it must be put in the context of employment.
We have heard a little about import penetration. The noble Lord, Lord Alport, wanted to put a ring fence round the nation. I can think of no single measure that would do more to destroy our competitiveness and to take us back to a siege economy.
Lord Alport: My Lords, is it not true that Japan has protected her market effectively for the past 25 years and perhaps more? Has that done any harm?
Lord Young of Graffham: My Lords, Japan may be a particular case and one to which I have no doubt attention is being given at this moment. But the sheer fact and the simple truth is that if we were to endeavour to protect our economy, we would be on a long and gradual slide to the centrally-controlled economies behind the Iron Curtain that I have heard so much about this evening. That is not the way which I suspect your Lordships' House would want us to go. We can be competitive; we are competitive. One only has to look at the experience of Jaguar over the past two years to realise that if we produce the right quality on time we can be back where we used to be. I believe we shall. Not one jot or tittle of the words of the noble Lord, Lord Houghton of Sowerby, do I dissent from this evening. All he said had the ring of truth and common sense about it. I wish he would speak to some of his noble friends and perhaps persuade them, if I am not able to do so this evening.
I have apologies from the noble Lord, Lord Molloy, who unfortunately cannot be here at this time. But to say in this House that privatisation has failed beggars
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the imagination. There is not one company that has been privatised that is not doing better today than it used to. There is not now one more self-evident popular programme than privatisation. The proportion of British Telecom employees who are shareholders is an example. From that example will I hope flow many more cases of privatisation. Privatisation restores once again the sense that it is the customer who counts; the customer who creates jobs. That is the lesson that goes through this debate and the White Paper, and it is a lesson that none of us must ever forget.
Lord Dean of Beswick: Rubbish, my Lords!
Lord Young of Graffham: The noble Lord may say "rubbish", but I am afraid that many of the lessons we have learned and lost during the 1960s were because in the 1960s and 1970s we were concerned with matters other than quality and production and other than the customer himself.
The noble Lord, Lord Graham of Edmonton, said that it was a Budget for jobs. It is, but it is a Budget that will take 12 months to come true because much of the work that the Budget has started—for example, the improvement in the Community Programme—will take months as it gradually builds up. Noble Lords have asked why this was not done sooner. We have built a soundly-based Community Programme from nothing to 130,000 places and now I hope we will have the opportunity to take it to 230,000 places. We have introduced a training element into the Community Programme. For the very first time over 30 per cent. of the people coming off the programme are going back into employment. Those are very real advances and ones which will be of benefit in the long run. The new Youth Training Scheme will start only next year. The national insurance changes will start in October. The Government are determined not to adopt a flashy course to do things for quick results. The Government are determined to lay secure foundations for the future which will last.
We have also heard much about wages councils. I stand here tonight personally convinced and utterly convinced that wages councils destroy jobs for young people because I have seen that. For the under 18s I have seen in too many cases wages councils set minimum rates of pay for young people above the level of the young workers scheme, and in many instances this resulted in—my Lords, I have given way three times already.
Lord McCarthy: My Lords, is the noble Lord telling us that before the consultation process begins he has already decided that wages councils are no good because they destroy jobs and must go?
Lord Young of Graffham: My Lords, the noble Lord would do well to exercise a little patience because I was just about to say that while I am personally totally convinced that that applies to under 18s, there is a period of consultation and I wish to see what comes out of that period of consultation. The noble Lord, with a few more seconds of patience, would have had his fears put to rest. We have to be patient and we have

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to be understanding. We have to realise that many of these restrictions that we have laid upon ourselves, many of these inhibitions that we have placed upon our expansion serve the same sort of purpose as that when we once feared that to drive a motor car we had to have a man with a red flag walking in front of us. We found to our surprise that we could manage without the man with the red flag. My role and what I am helping to do within this Government is to help to create the climate and culture of enterprise on which continued economic growth depends. I have helped to set in hand a programme of action which includes measures to remove unnecessary regulation from the market, to encourage the growth of small firms, to stimulate tourism and to help to equip young people through education and training with the skills and adaptability on which economic prosperity depends.
I must remind your Lordships and remind you again that the world in which these young people will live will be vastly different from the world in which we have grown up. A vital part of this strategy is to secure firm foundations, to encourage enterprise and to reduce the burdens that Government impose on business. The report published last week entitled Burdens on Business by the Department of Trade and Industry shows clearly that burdens are a major drain on the resources of industry, particularly on small firms which are the seed corn of our future. What concerned me about that report was that many of our small business men reported that they were not too concerned with some of the burdens imposed by Government. Perhaps they did not notice them. I can only liken that to the man who has lived in this country all his life and has never ventured abroad. He does not miss the sun, but let him spend some time on the Mediterranean and he would be satisfied no more. My job, my ambition, is to bring out the sun on all small businesses in this country so that they can expand and grow.
Within this Budget—although little credit was given for it today—the VAT threshold was raised and development land tax abolished. It is a start but a start on which we have to build. I will be leading an initiative with my colleagues to follow up the Burden on Business report and to consider deregulation more widely. I wish to aim to make real progress in reducing the cost to industry of compliance with Government rules. We have to get the right balance between licence and liberty. We need freedom to let people expand and businesses multiply, but not the licence to let them abuse another. I suggest that that balance is not set for all time, but the circumstances which existed many years ago have changed today and this is something at which the Government have to look from time to time. There is no desire on the part of the Government to take away the protection that is necessary for consumers, workers and customers. We do not wish to reduce that but we must cut the over-complex or unnecessary regulation. If we look at the economies in the world that are growing fastest they tend to be the less regulated ones.
During this evening, not enough credit has been given, I suspect, to the part that small firms play within the growth of industry. In the United States, in France
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and in Germany over half of employment, over half of wealth creation, is in small firms. And we are well under. What we are doing within the Budget—the reduction of the national insurance charge—will, I believe, help small firms as much as large ones. And the reduction of employment protection, although it is aimed at large firms, will help, I believe, small firms as well; because it was difficult to get the message across—allowing small firms the liberty to employ people for up to two years before making a firm commitment was not exactly well known.
So I hope very much that small firms themselves which are an integral part of the enterprise culture, small firms which are innovative and flexible, small firms which are adaptable to new market opportunities will be the firms which will help our economy to grow. I hope that we shall see many more of them—like that of the young man I met in Stirling not that many weeks ago now, who 11 years ago was an apprentice joiner and today employs 700 people. What we need, what we must have, are people who are ready to start small firms and to make them large firms. What we miss sorely today are the small firms of 15 or 20 years ago which would be employing 500 or 1,000 or more today.
It is not just manufacture. Tourism itself is a very real employer today. The hotel and catering industries have over a million people working and another 350,000 jobs exist in libraries, museums and art galleries.
The Earl of Gowrie: Hear, hear!
Lord Young of Graffham: The position is similar in sports and recreation and other services for tourists, as my noble friend Lord Gowrie well knows. But more than one independent forecast has pointed to substantial increase—anything up to 350,000 new jobs in the next 10 years—in the numbers employed in tourism and leisure. These are jobs which are not confined to the South or South-East. Not long ago I went to Bradford which, in my youth 25 years ago, I must confess I would not have chosen as a tourist place. It now has a very good tourist industry.
That is why we announced yesterday that I am going to lead a small group to focus particular attention on tourism and the leisure industries. We must look at matters about which some of your Lordships in this House have expressed concern—such matters as licensing laws, shop hours and other matters which must be right if we are to enable enterprise to flourish and grow.
I have spoken already earlier this afternoon, in making a Statement, about the great changes which are being made in our treatment of young people set out in the White Paper which is published by the Government today. In looking at that, I believe it is important to see where we were three years ago and where we are going to be in two years' time. In looking at those proposals, I think your Lordships should appreciate that, if we get the right review of vocational qualifications, if we get the right response from employers, from unions, from the world of education, in two years' time we could have the beginnings of a

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system of vocational education for our young as good as any in the world; and that is a very long way to travel in a very short time.
I believe that great credit should be given and tribute should be paid to the attitudes of employers, of unions and of the world of education for the way in which they have worked together—because youth unemployment is not a British phenomenon. Even in the United States, with the level of unemployment down to 7·4 per cent., unemployment in the 16–19 year age group is 19 per cent. In Italy, youth unemployment is now well above 35 per cent. and going towards 40 per cent. In most countries in Europe youth unemployment is far worse than in this country. It is the energetic steps that the Government have taken over the past three years which, I believe, will put paid to that terrible spectre of youth unemployment. They will give young people a firm foundation for the future.
That is what the Government are doing now. It is a Budget for jobs, because the only jobs you can really have in this world are not the jobs that Government create, not the short-term jobs which are created by spending and which have been tried so many times before, but jobs that have a firm foundation built upon enterprise.
I have read of late arguments that have appeared in newspapers that we, as individuals, are somehow no longer capable of enterprise; that, as a nation, we want the comfortable slide down to obscurity; that there is no one left in our world who really wants to go out and win. Those who write those articles in those national newspapers do not, I am afraid, come round with me to the schools; they do not come round with me to the colleges and to the universities. The young people whom I see out there do want to win; they are prepared to go out and work for themselves and they are prepared to go out and work for others. They are prepared to create wealth, to create enterprise; and, my Lords, this Budget is another stepping stone towards the restoration of the fortunes of the United Kingdom.
8.5 p.m.
Lord Barnett: My Lords, we have had an excellent debate and I should like to thank everybody who has taken part in it, even if I did not agree with everything that was said. I will come back, if I may, in the few minutes at my disposal, to one or two words that the noble Lord, Lord Young, has just said. But I should like to begin, as everyone else has begun, by congratulating my noble friend Lord Murray of Epping Forest on an excellent first contribution to our debates. I have known my noble friend for some time. We did not always agree. Occasionally, when I was cutting public expenditure, he thought that I should not have done so. Nevertheless, we got on excellently—as I did with most of my colleagues at that time. Whatever else one can say about my noble friend Lord Murray, his contribution to that Government, to the nation and to the nation's wellbeing goes without saying; and everybody who has contributed to this debate has paid tribute to that contribution. Speaking for myself and, I am sure, for everyone else, I am delighted to see my noble friend looking so much better, fully restored to
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health, I hope; and we look forward to hearing him often in future in our House.
The debate has been a very interesting one. Obviously, from the Front Bench opposite we have had speeches in support of the Government. After all, that is what they are paid for. The noble Earl says, "Not very much"! I am sure that the Prime Minister will note his complaint. But we have just been told that some people should take less.
The strongest support for the Government came, of course, from one or two Back-Bench speakers, and not just from the Front Bench on the other side of the House. The noble Baroness, Lady Carnegy, made a speech in support of the Chancellor's Budget which I doubt the Chancellor would have recognised. She said that it was a popular Budget, a bold and imaginative Budget. I am bound to say that if the Chancellor reads that he will wonder which Budget the noble Baroness was talking about, because I doubt whether even he would describe it in that way.
The strongest other supporting speech for the Chancellor and the Budget, as one would expect, came from the noble Lord, Lord Marsh—with one exception in relation to national insurance contributions, which of course he told us, and we understand, would have serious consequences for those in the newspaper industry. But he was a very strong supporter of the Chancellor.
The noble Lord told me very kindly that I would not get selected for a marginal constituency given my present views. I am bound to tell the noble Lord, judging from his contribution in this debate and others to which I have listened, that he is not likely himself to get selected for a "wet" Conservative constituency at any time. What the noble Lord did (as did a number of other speakers) was this. He constantly accused others of using old political tricks and of being politicians. He uses the oldest political trick in the game. He puts up cases that nobody has ever made and then proceeds to knock them down. For my part, I never said at any time that there was an easy way of reducing the level of unemployment. I am glad to see him nodding.
Equally, I never said that one could have unlimited borrowing. Of course one could not; and I did not suggest that. I suggested a borrowing requirement for 1985–86 which the Chancellor had for 1984–85: one which we could well live with and which would allow the expenditure of some £5 billion in 1985–86. It would go a long way to doing something to which the noble Lord, Lord Young, has just referred. He said—and I agree with him—that jobs come from customers. If you put another £5 billion of demand into the economy, you will create more customers. I see the noble Lord nodding his head. I am obliged.
There is a point where the noble Lord—I do not know whether it is since he joined the Government, and I would not do him that injustice—has now become a supply-cider. I assume he has become a supply-cider, because somebody else said in this debate that there is nobody in the Government (I think that that was what was said) who is opposed to what the Chancellor is doing. That is not true. We all know that there are one or two in the Cabinet—I excuse the

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present company, and I am glad to see the noble Earl and the noble Viscount nodding.
I am not sure that the noble Viscount is really all that much in favour of what is going on; but I should like to say to the noble Earl, Lord Gowrie, that he often quotes my book, and I am most grateful to him, but he does not give the name of the publisher and the price. He told us in the last debate that the Prime Minister keeps a copy of my book by her bedside. He must keep two copies, well marked, because the only lesson he clearly has not learned from my book is that the circumstances of today are very different from what they were then. Of course I was in favour of controlling public expenditure and controlling the borrowing requirement; and I still am. That much has not changed; but there are levels of unemployment in real terms which one can reach—probably at about 4 million—which are different from what they were then and which change the circumstances. So I am bound to say to the noble Earl that he really had better re-read my book—I will send him another copy if he likes—and mark it differently. Then, perhaps, we may get some slightly different contributions in the future.
We have had many contributions in the debate which dealt with the question of capital expenditure. The noble Viscount, Lord Chandos, in what I thought was an excellent speech—I believe my noble friend wishes to say something to me. Somebody on the other side of the Chamber is saying, "Too long". I have until 8.17—is that not correct? Thank you very much. I am obliged. Can we have a little silence from all sides?
Perhaps I may refer to some of the excellent speeches that we have had in this debate—and we have had some excellent ones. Some of them, including the speeches from the noble Viscount, Lord Watkinson, my noble friends Lord Bottomley and Lord Dean, the noble Lord, Lord Ezra, and the noble Viscount, Lord Chandos, referred to capital expenditure. I did not agree with much else that the noble Viscount, Lord Watkinson, said, but on capital expenditure he was quite right. The Treasury, under successive Governments, still have not learnt how to distinguish, in public expenditure, between capital and current expenditure. That is quite right. I have been concerned about it for some considerable time, from the days when I was Chief Secretary. I have indicated the nonsenses of the present definition of the public sector borrowing requirement that results in £1 billion at one moment counting as an asset and the next moment counting as an addition to the borrowing requirement, so that you have to do something about it which has the effect of reducing demand. It is a nonsense.
May I now turn to some of the other points in the debate?
The Lord President of the Council (Viscount Whitelaw): No, no!
Lord Barnett: My Lords, I should like to reply to some of the points that have been made in the debate. I am sorry the noble Viscount disagrees with me, but I should like to say one or two things about what the noble Lord, Lord Young, has just said. I hope he will not mind that.
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The noble Lord, Lord Young, gave an example of one particular small firm that was employing 700 now and which 11 years ago was not employing anybody. It had started as a one-man business and had built up to employing 700. What he did not tell us—and he must know—is that there are far more firms that were employing 700 seven years ago or less and which are now employing none because they have gone bankrupt. That is the plain fact. If the noble Lord wants me to give way, I will, but his noble friend will be very upset.
Viscount Whitelaw: No, my Lords.
Lord Barnett: My Lords, the other point I should like to take up which came from the noble Lord, Lord Young, is his reference to the need for low unit costs. Of course, he is quite right—that is the need. But he, like others, constantly talks about the need for low wages. You can have very high wages and low unit costs, as he himself concedes; and, indeed, in West Germany one sees that is the situation. I see I am wearing out the patience of some noble Lords. It only remains—
Viscount Whitelaw: My Lords, perhaps it would be fair if I told the noble Lord why there is some impatience. I think it is felt that it is not normal for the person who opens the debate at the start to make a long speech at the end. It is normally a very short speech, thanking those who have taken part in the debate, and not another winding-up speech. That is the normal custom and that is the reason for the impatience. I hope the noble Lord will appreciate that.
Lord Barnett: My Lords, I am only too well aware of the noble Viscount's record on the subject of patience and impatience, and I appreciate what he says. But, as I understood it, I had until 8. 17. I have two more minutes to go, and I was just coming to my peroration, so he will be very happy indeed to hear that. The point that a number of noble Lords have made, including the noble Lord, Lord Marsh, and one or two others, and which is central to the debate, is that you cannot borrow your way out of unemployment. That is a view with which I entirely agree. But the same cannot be said about a PSBR which is the same level as last year. For those reasons, I think the Government's economic policies and the Chancellor's Budget deserve to be condemned by anybody who is interested in the subject of unemployment. The noble Viscount now wants me to speak again. I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Northern Ireland: "Supergrass" System
8.15 p.m.
The Earl of Longford The Earl of Longford rose to ask Her Majesty's Government whether they are satisfied with the working of the "supergrass" system in Northern Ireland.
The noble Earl said: My Lords, I hope and believe that I shall receive a negative reply to my Question. I do not think that I have previously had the opportunity of opening a debate that was to be replied to by the noble Lord opposite. I know that he is as enlightened as he is allowed to be in such situations, and so I look forward to his answer.
I shall begin by referring to the Tenth Report of the Standing Advisory Commission on Human Rights in Northern Ireland. The commission's report has no doubt been carefully studied by the Minister and the commission appear not to have felt that it was within their province to say whether the system of supergrasses should be continued. They suggest, however, 10 safeguards in the event of its continuance. Those safeguards are welcome so far as they go, but I shall say at once that I shall be submitting that the system itself should be abruptly terminated as being totally contrary to ordinary ideas of legal justice and as calculated to bring the whole legal system of Northern Ireland into disrepute.
Do not let us have any misunderstanding, at any rate, of my own position here. Again and again I have condemned violence, whether from the Nationalist side or from the Loyalist side. I hope I shall not put myself in a bad way with my new Protestant friends in Northern Ireland if I quote the Pope. I know that the noble Lord the Minister, to say the least, takes an interest, but I hope I shall not be losing new friends if I quote the Pope, who said in my hearing in Southern Ireland when he went over some time ago that all violence of this kind was murder.
So I start from that point of view; and I have a deep sympathy with the police. They have a terrible task and I admire their courage very much. It is very hard, without exceptional measures, to secure the necessary convictions. I have a particularly high regard for someone I know quite well, though I do not know what regard he has for me. I refer to the Chief Constable of Northern Ireland, Sir John Hermon. I feel that in a sense all I have got to say can be summed up in the next sentence that I am going to use: You cannot cast out Beelzebub by Beelzebub. That is really the pith of what I am submitting to your Lordships.
Let us take a look at the facts. In recent times, to quote the advisory commission, there have been a number of major terrorist trials in Northern Ireland which have been based on the evidence, often uncorroborated—to use their expression; in my experience always uncorroborated—of a witness who had been an accomplice in the crimes charged. These witnesses have been called converted terrorists by the police and by Government spokesmen, but they are commonly known as supergrasses because of the number of defendants who are tried largely on their evidence.
According to figures compiled by the Guardian, which I read in that eminent paper today, of the 25 informers in the so-called supergrass class who have emerged in the last four years, some 15 have subsequently retracted. Another four have had their evidence rejected by the courts and there are two trials taking place. Again—I am still quoting from the Guardian—of the 446 people named by the supergrasses, 80 have been found guilty and 291 freed.
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The rest remain in custody on remand or awaiting the end of trials. Twenty-nine men were freed as recently as last Monday. In other words, the system is proving increasingly ineffective; but effective or otherwise—I want to stress this—I would still say that it is utterly wrong.
There is, of course, nothing new about the use of accomplices. The standing commission picked out certain features of recent supergrass trials in Northern Ireland which give rise to particular concern, and which arguably call for greater safeguards than exist at present. I shall spell out briefly the areas of concern delineated by the standing commission, but in the time available I must concentrate on one of the areas of concern. I refer to the lack of corroborative evidence to support a supergrass testimony. The other five areas of concern are as follows—and I am still referring to ones picked out by the standing commission.
First, there is the grant of complete immunity to dangerous criminals who have committed very serious crimes, and various other inducements. Secondly, there is the lack of disclosure of the arrangements made between the authorities and supergrasses. Thirdly, there is the absence of the jury in supergrass trials, with the result that the trial judge has to warn himself—a strange piece of introversion—not to place too much reliance on the evidence of a supergrass. Fourthly, there are the delays in bringing to trial defendants charged upon the word of a supergrass and the length of time such defendants have to spend on remand in custody. Fifthly, there is the sheer size of many recent supergrass trials.
The commission spelled out at some length the kind of safeguards which they felt would alleviate these evils, assuming that the system itself would go on. But I hope the noble Lord will agree that they did not place their authority behind a continuance of the system or behind the idea of ending it. They left that an open question, but suggested certain safeguards and, as far as I am concerned, those safeguards are welcome but do not go anything like far enough.
It may be wondered how I came into this, apart from a general propensity to push myself into areas which are sometimes left to others. Not long ago I was approached on behalf of an association called Families for Legal Rights. It is an association of Protestants, of Ulster Loyalists, fervent Loyalists proud of being British and even today, as they told me, proud of the British system of justice even when they consider that it is being grossly abused. I must leave it to others to decide why they picked on me. It may be thought that they could not get anyone else, or that I seemed to be the ideal person. I must leave those speculations to a charitable man such as the Minister. At any rate, I can only say that I was flattered and honoured, and remain so.
I was invited to go over to Northern Ireland and to sit as an observer at one of these trials. I should like to give a picture of that trial for the benefit of noble Lords and anyone who reads these remarks. There were 29 men in the dock, including, incidentally, a brother of the supergrass, who was a man with a long and appalling record of crime, including two murders. Hour after hour the leading criminal barrister in Northern Ireland cross-examined the supergrass who

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was caught out time and time again on inconsistencies. We have all read about famous cross-examinations, like Carson's cross-examination of Oscar Wilde. The leading QC in Northern Ireland may be a Carson, but the supergrass was hardly an Oscar Wilde. At any rate, the supergrass produced inconsistency after inconsistency. After I left for England the case dragged on until the judge stopped it on the grounds that the supergrass could not be accepted as any sort of credible witness. That is one case to which I came close.
That is satisfactory so far as it goes, but it does not go very far. The lives of the defendants and their families will have been devastated, even when they are acquitted. Large numbers of such men are in prison from the time of their arrest until their trial. I understand that the time on remand often exceeds two ears. So it is by no means a case of "All's well that ends well" when a supergrass is discredited.
I learned a good deal from my day in court. I learned even more from my host and hostess on that and subsequent occasions. My hostess is secretary of Families for Legal Rights. My host worked for many years for Harland and Wolff and, suddenly, on the word of a supergrass completely uncorroborated he was swept off to custody. This supergrass alleged, without corroboration, that my friend had been involved in running guns from two uncles in America to a third uncle who was allegedly in charge of an engineering works in Belfast.
The House will find it hard to believe what I am about to say, but it happens to be true. My friend had no uncles in America, nor had he a third one in charge of any engineering works in Belfast. No corroborative evidence was brought to prove any of the assertions made by the supergrass or even to prove that the crime in question had ever occurred. I should explain that my host was tried along with 13 other men, who may or may not have been equally innocent. Be that as it may, he was sentenced to 20 years in prison. He had been in prison for six months before trial and he was in prison for another two months while the appeal on behalf of all 14 men was being heard. The three judges in the Appeal Court set aside the decision of the judge lower down. I should remind the House—the Minister is thoroughly aware of this—that there are no juries in such cases in Northern Ireland at the present time.
How is my friend placed now? He has lost his job and, with unemployment in the shipyards as it is, there seems no prospect of his getting it back. He has received no compensation—I linger on that point for a moment—for two-and-a-half years taken out of his life in this horrendous fashion. He does not receive supplementary benefit because his wife goes out to work; so he and their children exist on her earnings. I hope that that vividly illustrates the working of the supergrass system in Northern Ireland, which no decent person can defend.
As I said, I must concentrate on one outstanding evil in the system; that is, the lack of corroboration for the evidence of a supergrass. It is by now, I think, understood in this country that judges are expected to warn juries to be very careful about accepting the evidence of accomplices, but in Northern Ireland there
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are no juries in these cases and so the judge is in the position of having to warn himself. This may well be felt to be an impossible feat. At any rate, the judge in the case of my friend found it impossible, according to the Appeal Court, to assess correctly the credibility of the witness in spite of that witness's dreadful record.
So far as I can discover (and I have checked this point with lawyers) in this country, where we do have juries, the uncorroborated evidence of an accomplice is no longer relied on. If that practice were introduced into Northern Ireland, the supergrass system as we know it would be fatally undermined. I am therefore asking the authorities—through the Minister today or through the Minister and his colleagues later—to make sure at the very least that in this respect English practice is introduced into Northern Ireland.
I have spoken to lawyers about this matter and it seems that it would be perfectly feasible. I am so glad that the noble Lord, Lord Gifford, may be able to help us in that regard because he has done more work than anyone that I know on this whole subject. In any event, I hope that legislation can be introduced in regard to Northern Ireland. But we should not wait for that. The relevant authorities should make it clearly known that the system has now been brought to an end. At the moment, there are only two cases outstanding. It would be a fine thing if the Government decided now that enough is enough.
In a moment I will sit down, but before I do so there is one further aspect of this subject which I cannot refrain from touching on. The case I have briefly outlined stands on its own. I will add a further thought which is more speculative. When I sat in on the supergrass trial with a gifted Member of the House of Commons, Mrs. Clare Short, we were accompanied by a leading American lawyer—an RC as it happened—who had visited Northern Ireland five times previously and observed other supergrass trials. I have been given a copy of the report he wrote on his return to America.
This American lawyer concludes—and this was interesting coming from an outside source but from someone who had been to Northern Ireland quite often—that the Loyalist community or large sections of it have been outraged by the use of the supergrass system against themselves. This eminent lawyer refers to a dramatic change in Loyalist attitudes (about which I would hesitate to speak in front of the noble Viscount, Lord Brookeborough, but I accept such evidence when it comes before me) and to his own reception in a Loyalist club in the Shankhill Road which was far warmer than he felt could have been possible a little while earlier.
I myself caught a glimpse of the same development when I attended the trial to which I have referred and made a further visit. Is it wishful thinking to hope that out of this evil supergrass system good may yet come?—not in any change in strictly political attitudes (because I am not looking for that—at any rate, not at the moment) but in the beginnings of a new community of human feeling based on a common sense of victimisation between the hard core of vehement Protestants and the hard core of vehement Catholics. It is significant that the equivalent body on

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the Catholic side has warmly welcomed the initiative I am taking this evening.
Let us hope that good will come out of evil. Be that as it may, the evil itself must be brought to an end without a moment's hesitation.
8.33 p.m.
Viscount Brookeborough: My Lords, I should like to thank the noble Earl for putting this Question down. He has, as usual, argued his case with great compassion and concern for what he believes to be the underdog. I am not sure that his perception of the underdog is quite correct. Still, the noble Earl has argued his case with great compassion.
When the noble Earl told me that he had met Protestants in Ballysillan he said, "You know, they are really very nice". I had to tell the noble Earl that Protestants are quite often nice. We in this House all value our freedom and the safeguards to our civil rights. It is only when the attack on those civil rights becomes unbearable that we agree to suspend some of them to protect the rest. The dilemma which faces authority is to convince the public that the Government have the will to win; they therefore must take certain action to produce that conviction. If they do not do that properly, then somebody will take the law into their own hands. It was the lack of faith in authority that led to the evil organisation of the Ulster Volunteer Force growing.
Where are we now, after 14 years of terrorism? The noble Earl has spoken about there being no juries. The fact is that the people who are complaining about the no-jury courts have made juries impossible. They have intimidated and murdered both witnesses and jury members. They have forced us to have the Diplock courts. Now there are no juries and sometimes there are very few witnesses. At this point, I should like to say something about our judiciary in Northern Ireland. Our noble and learned colleague Lord Lowry, judges, magistrates and the lot, have been attacked viciously and murdered. Their courage and their integrity has been an inspiration to all of us in Northern Ireland, and I salute them.
For democracy to survive, there must be convictions of men of violence in the courts and they must be put behind bars. After a successful propaganda campaign by the IRA, aided by idealists and civil rights movements, internment was rendered unacceptable just as the interrogation method of producing confessions became unacceptable. Now we see a massive campaign against the use of converted terrorists by the IRA and their misguided idealists. If the idealists are genuine, they must produce alternatives—and none has been produced.
The noble Earl said, "Bring back the juries". If the noble Earl saw a murder committed in County Fermanagh and he was living in County Fermanagh, I do not imagine that he would serve on the relevant jury and then return to his farm and milk his cows. The noble Earl must be realistic; juries are impossible the way things are now.
The burden of the noble Earl's complaint is of uncorroborated evidence, but modern legislature appears rather to favour uncorroborated evidence.
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The Lord Chief Justice has made clear that while the law stands as it is in England and Wales and in the Irish Republic and in Northern Ireland, then judges must apply that law if they are the presiding judges. The suggestion of the noble Earl to change that law is merely turning the clock back. The civil rights campaign was based on bringing to Northern Ireland the standards of the rest of the United Kingdom. It would be a retrograde step, and indeed a paradox, if this practice were changed now.
The other arguments against the use of accomplices go on in various ways. Those who argue have it both ways. In the first case, if a judge produces an aquittal, then it is said that the authorities are producing weak cases. But if the judge convicts, then it is said that he is a case-hardened judge. I suggest that the opposite is true; that judges have been shown to weigh the quality of the evidence 'very carefully. I would guess that if there were a jury—and a jury is not possible in these cases—and if it were 'faced with a horrific crime, then that jury would be much more likely to convict on bad quality evidence than the judges who are so experienced.
Indeed, the noble and learned Lord, Lord Gardiner, suggested in his report that infiltration into terrorist organisations is necessary. This must therefore envisage the use of the accomplice to give evidence. The terrorists are campaigning against the use of converted terrorists because it will destroy them. They are worried, and that is good.
The case put by the noble Earl based on his observations at one day of a trial plus two weekends staying with Mr. John Bingham produced the result that the supergrass he saw was untrustworthy. I question whether the noble Earl's friend is trustworthy, or is he not? The noble Earl has said that Mr. Bingham was charged with about 10 offences—very serious crimes such as possession of firearms, involvement in murder, and so on—and with membership of the UVF. In 1977 he was charged and convicted of being drunk and disorderly, and in 1975 for being criminally drunk. Earlier in 1975—your Lordships should wait for this—he was convicted of managing a brothel. Is there a precedent there?
The Earl of Longford: My Lords, I wonder how the noble Viscount knew that I was going to speak about Mr. Bingham, because I told him in confidence that I was going to refer to him. Is he playing the game by making a personal attack on a man who cannot be defended today and in whom I have a lot of confidence?
Viscount Brookeborough: My Lords, I will answer the noble Earl by saying that on the 1st February the newsletter published the fact that he was in Mr. Bingham's house.
In Ballysillan he is well known for his position in the UVF and for his involvement. Of course he has a direct interest in stopping supergrass trials, but I wonder: who was the most untrustworthy? Those who are against supergrass trials say that they are not a success. That is not true. They are a success, even when the judge throws out the evidence and does not convict. A supergrass is giving his version of what is

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happening in the terrorist organisation. Who better to do that than a man who has been totally involved? The intelligence gathered is worth anything to the security forces.
The noble Earl said that the supergrass fumbled his lines. If he had been properly drilled people would have said that he was word perfect and that it was not true evidence. So one cannot have it all ways. What must be said is that by the very nature of past history a supergrass must be an unsavoury character. He will have been involved in terrorism and crimes of violence, so no one should expect him to be the most charming person with whom one would want to spend one's time. But the dividends are vast for intelligence.
Some 70 people have been convicted by the supergrass system. It is worth noting that in North Belfast, after what was called the Black case, the level of violence was down by 70 per cent. Men are alive today who would have been dead had it not been for the Black case. Prior to the Gilmour case, one person was murdered every week in Londonderry. During the case hardly any violence occurred. Now, after it has been thrown out, violence is increasing again. Like others—and, I suspect, even the judges themselves—I am worried about the numbers that a supergrass implicates, but an accomplice may have been involved for many years and are we to say that for an accomplice to involve three people is acceptable but 20 is not, even if there is evidence to show that the 20 were involved?
The noble Earl spoke about good coming from evil. I think that the noble Earl has totally misjudged the situation. I believe that we have a criminal conspiracy of both the IRA and the UVF, with a joint interest in racketeering, blackmail and preventing their organisations from being destroyed, which inevitably they will be by the supergrass.
There is no other solution that I can see. In my small county, with about 20,000 people in the area, 70 of my friends have been murdered and only one person brought to justice. How pleased we would all be if a supergrass would turn up. I would not mind if the people who committed all those crimes were implicated. The defence of British democracy is being fought in the whole United Kingdom. The hand that killed my friend Jimmy Graham and Sergeant McCormack in the past few weeks is the same hand that laid the bomb in Brighton in an attempt to wipe out our Cabinet and our democracy.
8.45 p.m
Lord Gifford: My Lords, late in 1983 I was asked by the Cobden Trust to undertake a mission in Northern Ireland to inquire into the use of supergrasses in the Province. I went there and, like my noble friend Lord Longford, I was amazed at the breadth of opinion that wanted to come to me to speak of, and speak their opposition to, the use of supergrasses. I met Catholics and Protestants. I met many people who had nothing to do with, and no truck with, terrorism or terrorist offences. I was received with the greatest courtesy by the Lord Chief Justice, the noble and learned Lord, Lord Lowry.
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I went with a very open mind. I was very well aware of the enormous difficulties which the police have in bringing criminals to justice, in obtaining evidence which can go before a court, and I was, of course, aware that the law of England and Northern Ireland has allowed the use of accomplices for many years. I came away far more disturbed than I had expected to be. I was driven to the conclusion that the use of supergrasses could not be supported. I came to two key conclusions which go to the root of the contributions which have been made, particularly that of the noble Viscount, Lord Brookeborough.
The first was that it is quite inevitable that supergrasses will be telling lies—perhaps not complete lies, but many lies. Secondly, it is wholly unreasonable to expect the judiciary, with the best will in the world, to distinguish between the truth and the lies. I shall analyse those two conclusions for a little while. The supergrass—let us be very clear about this—is not a converted terrorist. In the whole investigation which I carried out I came across only one person who even claimed that he had, while at liberty, changed his mind about his past and wished to give evidence on behalf of the authorities. That was the man McGrady, who gave himself up. In every other case what has happened is this. A man has been arrested. He may well have been caught redhanded. He is facing a very long prison sentence, if not for life. In many cases he is a man who has been in prison before and is desperate to avoid that sentence. In those circumstances he starts to consider whether he can make a deal with the police authorities—because what this system involves is the making of unsavoury deals whereby people (I believe 15 in all in the past few years) get complete immunity for crimes up to serious multiple murder and financial assistance to set themselves up in another country with a new identity so that they can be free from the revenge of the organisations against which they have given evidence. The granting of that new life, new identity and financial assistance is integral to the deal. It is the bargain which the state must make with these men.
Once that deal is in prospect and once that man has decided to make that deal there is one thing uppermost in his mind; that is, self-preservation. His life is in danger once he has started to inform on the organisation of which he had been part. He wants to make the best case he can to get that immunity. I identified five different reasons why such people will inevitably be driven to tell lies. First, they will wish to incriminate as many people as possible because, if they only know about two, three or four, they are not much use to the authorities. The authorities will not let them go free for just a handful of people to charge. What is really valuable to the authorities is a great number of people in the dock, as has happened in these trials.
Indeed, the Attorney-General himself has, in effect, encouraged the supergrass to name as many people as possible by saying that immunity is considered:
"Where the evidence which the accomplice can give is credible and cogent and involves perhaps a large number of alleged terrorists who cannot otherwise be charged or brought before the court".—[Official Report, Commons, 24/ 1 0/83; col. 4.]
That is the first reason. The supergrass will therefore put into the statement which he makes as many people

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as possible, whether to his knowledge they are really involved or not.
Secondly, he will play down so far as possible his own part in the crimes with which he is involved. It is commonly said by the police that nobody who actually pulls the trigger gets immunity. Therefore somebody who has pulled the trigger will lie about his involvement and put somebody else in the role which he played if that role is one of a principal in a murder or a bombing.
Thirdly, of course, he will work off any grudges that he may have against former associates. Fourthly, he is likely to pretend that he knows as a matter of fact about things which are only gossip or rumour and hearsay in order to make up the numbers. Fifthly, and perhaps supremely, he will want to give the police the evidence which he thinks they want to hear.
In the trial in which the supergrass Grimley gave evidence and was wholly discredited, under cross-examination he said that the police were suggesting names to him, including names of defendants. That is likely to be true, is it not? The police think that they know that certain people are terrorists, and of course they are going to ask the supergrass, "Can you help us about so and so? Don't you know surely that so and so is involved?" People will be implicated not because the supergrass has hard, first-hand evidence to give about them but because he believes that that is what the police want to hear.
The lies that have been told have sometimes been proven in court, when, for instance, as in the McGrady trial, there is independent forensic evidence to show that what a supergrass has said cannot possibly be true. But that is rare. Normally the evidence is about conversations, conspiracies and attempts, and by its very nature cannot be confirmed by independent evidence.
It is often said that that may be so and lies may be told, but we have a judiciary capable of applying the standards of proof as they are applied in a British court. I should like to come directly to that argument. I should not like, and I do not think that anyone, whether he has a legal training or not, would like, to undertake the responsibility of listening to a man giving evidence about incident after incident and then having to say, with no corroboration at all, whether that person is telling the truth or telling lies.
The noble Viscount, Lord Brookeborough, raised this point: when the supergrass is word perfect and when he repeats what he has said to the police in court, two things can be said. Either he has a genuine memory of events which he knows about or he has learnt his lines incredibly well. The answer is that we just do not know in any particular case where the truth lies.
I have here the statement of Christopher Black, which runs to 63 closely typed pages. That was an extraordinary trial, with 38 defendants and 138 charges, running over years. The witness in the box was able to give an account to the judge which the judge found enormously convincing and which hardly differed in a degree from the statements which he made to the police. Why was that? Was it because he was telling the truth or because he has learnt his lines
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and was a good teller of his lines? I have spoken to the wives of supergrasses who have been with their husbands, and there is no doubt in my mind that a lot of rehearsal and learning of lines takes place. The supergrass may have a year between the original statement and the trial, and of course he will try to get his statement right. If he does not, he will be cross-examined and inconsistencies will be exposed.
If what was being said could be corroborated, as is the normal way of testing evidence in a court, one could see whether statements like that stood up. But they cannot be corroborated, and the result is that the judge, however hard he tries, and however good a judge he is, cannot be expected to sift the truth and the lies. Some of them have thrown out altogether the evidence of supergrasses: some of them have convicted almost 100 per cent. of the people who came before them. I know that the Lord Chief Justice is enormously concerned at the burden which that places upon a judge.
My conclusion from those basic findings is this. When that kind of evidence is being relied on in a court of law, justice becomes a lottery, innocent people get convicted, guilty men escape and the system of justice as a whole is discredited. The noble Viscount, Lord Brookeborough, asked what else we wished to put forward. My answer is that we can operate a system of justice only by putting before a court acceptable evidence which can be worthy of belief, and, for the reasons which I have tried to show, that cannot be the case in supergrass trials.
Of course I accept that judges have acquitted and have thrown out the evidence of supergrasses—sometimes the evidence of the most extraordinarily unreliable rogues, who should never have been used as star witnesses in a trial. In my report I appeal to those in authority to adopt one basic test: not to allow people to be convicted upon the uncorroborated evidence of a person known as a supergrass who has been involved in multiple crime. I appeal to the Director of Public Prosecutions, to the Attorney-General and to the judges. Judges in some cases have accepted that idea. In one case a judge said that it was highly dangerous and wrong to convict on the evidence of such a person as a supergrass unless it was corroborated. That should be the watchword. If that is not heeded by those who bring prosecutions, I agree with my noble friend Lord Longford that Parliament needs to intervene.
In fact there have been a lot of changes in the past 15 months. There have been no more mass arrests on supergrass evidence and a number of people have been acquitted. But there are still people in gaol on the uncorroborated evidence of supergrasses. There are still people awaiting or undergoing trial who are going through the most terrible ordeals in appearing before a system of justice which, unfortunately, does not deserve the name. If we are, as the noble Viscount, Lord Brookeborough, claimed, defending democracy, we must demonstrate the values of democracy supremely in our judicial system. Like my noble friend, I ask the Government to say now that this form of evidence should no longer be accepted by the authorities in Northern Ireland.
8.59 p.m.
Lord Hylton: My Lords, I intervene briefly in this important debate to draw attention to something happening in Northern Ireland that may well be more significant than supergrasses and more lasting in its effects. I think that it is relevant to this debate because it concerns the ultimate triumph of justice and peace in both the United Kingdom and Ireland.
I refer to the by now considerable number of men and women who have turned away from violence, not for reward, not for possible remission or leniency, but for higher motives and in spite of considerable risks and dangers to themselves. These are the people who have rejected murder and terrorism because they have experienced the power of the Gospel and have come to a personal faith in Jesus Christ. Some have found this faith in prison, some after release, and others have severed all links with violence without passing through any prison gates. The latter points are important because they dispose of the cynical argument that conversions happen only because prisoners want better conditions for themselves. In this context I can also mention the recent case of a man who had served one sentence and then confessed to murder and attempted murder. He did so in order to clear his own conscience. The judge, sentencing him for the new offences, displayed his respect for the man's sincerity.
I have met some of these men. A few years ago one of them said to me, "Last year I would happily have killed you, but now God has taken the gun from my hand and put a guitar in its place". This man played the guitar for various prayer groups. Another time I saw two former paramilitaries, one Loyalist and the other Republican, embrace and forgive each other publicly before a gathering of several thousand businessmen. I met another former Republican who had been on hunger strike while in prison for 50 days or more and very nearly lost his sight. He found faith and became friends with someone brought up in the opposite tradition. Now they are released and they both together give a powerful joint witness.
These are not flash-in-the-pan or isolated examples of personal change. A community that I know in Northern Ireland which exists for prisoners and ex-prisoners and their relatives has known 20 or so instances over the last three years. It reports that all these men are holding firm to their new course and to their repudiation of violence.
Elsewhere an organisation has been formed specifically for ex-paramilitaries who are now fully entitled to call themselves Christian. A book has been written and a video film made about the experiences of some of their members. Later this week, on Good Friday, there will be a service on the theme of repentance. I understand that it will be attended by some whose lives prove that they personally repent from their involvement in political violence.
These deep and costly changes are important, even though the results are difficult to quantify. Certainly they are affecting the relations and families. I believe that they are beginning to open some minds which up to now have been firmly closed. I think that they are more likely to change the current practitioners of violence than are any number of appeals or
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condemnations. I do not know the precise future role of those who have found faith and rejected murder. Perhaps it is not yet clear even to these people themselves, but meanwhile they certainly deserve our respect and strongest encouragement.
As the late Canon David Watson said in Ireland in 1976:
"In the tremendous struggle in which God has placed us, we really do need each other. We need each other's support and prayer and love. We cannot go it alone. We cannot go it alone even within our own tradition. That is why, through the cross of Jesus Christ. God has pulled down all the barriers between us. Whatever tradition you and I may come from when we come to the cross of Christ and open our hearts to the life and power of the Holy Spirit, there is nothing between us".
9.4 p.m.
Lord Blease: My Lords, I should like to join in thanking my noble friend Lord Longford for initiating this debate on this very vexed question of the so-termed supergrass trials. I believe that the debate so far has indicated that the issues arising from the use in criminal proceedings of the uncorroborated evidence of admitted accomplices are indeed of great public concern. The questions arising are serious. My noble friend Lord Gifford made reference, as did my noble friend Lord Longford, to doubts, to facts, and to where the truth really lies. These are the questions that have been raised in this debate. What are the facts? What are the truths of the situation concerning uncorroborated evidence?
Not only are the terms and the questions arising serious in respect of individual human rights and protection of the innocent, not only are the terms serious in connection with the promotion of standards of political democracy and elementary justice; the questions are also critically serious as regards the maintenance of community respect for the police and for the credibility of the courts. That is the kind of theme that I should like to put forward in what I have to say.
I should like fully to support and to concur with what has been said by the noble Lord, Lord Hylton. There have been a number of people who have been dramatically changed through conversion. I also know persons who have been involved in their early youth in terrorism, in certain aspects of the Northern Ireland confrontation, who have changed dramatically into good citizens. I would not say that they have gone so far as spiritual conversion, but they have held down good jobs and have been with their families. Sadly, they have been incarcerated through the alleged evidence of the supergrasses. This has destroyed many young persons who had changed their lives. It has in many respects given rise to human tragedies.
There can be no doubt that supergrass trials in Northern Ireland over the past four years have given rise to a high degree of public controversy. There is also evidence of a growing volume of concerned interest by international organisations in the legal implications of the trial. There is also mounting disquiet among members of both traditions in Northern Ireland, the Unionists and the Nationalists, and that cannot be disputed.

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Some noble Lords have already mentioned that they know about this disquiet through their meetings with representatives of the two organisations directly concerned. Some noble Lords have already referred to the Relatives for Justice, which is a body mainly comprised of the relations of persons charged on the evidence of Nationalist accomplices, and the Families for Legal Rights, which is an organisation concerned largely with the Loyalist prisoners.
These trials have generated a vast amount of coverage in the Irish and United Kingdom press and broadcasting media. There have also been a significant number of articles, pamphlets and reports featuring views and accounts of the supergrass system of criminal proceedings. In my opinion some of these publications and reports are serious and commendable studies of the issues and implications. Others are less commendable in the search for appropriate democratic measures to uphold human rights and at the same time deal with terrorist crime. A few of these publications and public utterances are blatantly propaganda, fraught with highly charged emotional and partisan arguments. They do little or nothing to promote the cause of freedom and community well-being.
For the purpose of this debate, I propose to confine my remarks to a few sources of what I consider reasoned and informed opinion. I propose to quote from the statement of Sir Michael Havers, the Attorney-General, of 24th October 1983, when replying to a parliamentary question in another place. I make no apology for going into considerable detail. I believe that it is an answer, in some respects, to what has already been raised in the debate. The source of accountability and the source of responsibility lies in this Parliament. Sir Michael said, at column 3 of Hansard:
"There are a number of misconceptions which appear to be current, and which should be corrected, about the use of evidence of accomplices in criminal trials in Northern Ireland and about immunity from prosecution which may be granted to such accomplices. There is nothing new about the use of the evidence of accomplices in criminal trials. The law in England and Wales and Northern Ireland is the same".
Sir Michael deals with the duty of judges and goes on to say, in connection with the Diplock court arrangements in Northern Ireland:
"A precisely similar rule applies where a judge is trying a case without a jury. The judge must warn himself that, although he may convict on the evidence of an accomplice, it is dangerous to do so unless it is corroborated. Subject to these rules, the uncorroborated testimony of an accomplice is admissible in law and the tribunal of fact has the right to convict upon it…In Northern Ireland terrorist crime is a serious problem and the full extent of the involvement of many of the terrorists is perhaps known only to those engaged with them in their criminal activities. When one of those who has been involved in terrorism and is thus an accomplice indicates his willingness to give evidence about crimes of which he knows and in which he may have been a participant, it is the duty of the chief constable to put the full facts before the Director of Public Prosecutions…Where the evidence of an accomplice appears to be credible and cogent and relates to serious terrorist crime, there is an overriding public interest in having charges brought before the court. This is especially so when the evidence which such an accomplice can give relates to murder, robbery, explosions and other similar atrocious crimes. In such circumstances it is the clear duty of the director to put the cases before the court for adjudication. It will then be for the court to determine whether the evidence of the accomplice is so convincing as to its content and so reliable in itself that it reaches the standard of proof beyond reasonable doubt".
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Sir Michael goes on to say in relation to a matter already mentioned—the question of dealing and immunity:
"In every instance the director's decision to grant any immunity from prosecution to an accomplice is of a limited nature. It relates only to the offences which he has disclosed and of which he has given a truthful account. He is thus liable to be prosecuted in respect of any offence committed by him which subsequently comes to light and which he did not originally disclose and any offence in respect of which it subsequently emerges that he gave a false or misleading account…The decision whether to grant immunity to any individual is taken by the director personally. No immunity can be granted by the police. Before any application to grant immunity can be made to the director, the chief constable must recommend that the accomplice should be called as a Crown witness".
The final paragraph of the quotation, which I consider of weighty importance in the debate, reads:
"In all these matters—and I refer now to the decision to institute proceeedings in reliance on the evidence of an accomplice as well as the decision to grant immunity to an accomplice—the primary responsibility is vested in the Director of Public Prosecutions for Northern Ireland. The decision in each case is wholly within his discretion which he exercises in accordance with his professional judgment and in full consciousness of his responsibility for the independent and impartial discharge of the duties of his office. He acts, however, under my superintendence and is subject to my direction. He keeps me fully informed of the general policies which he applies in this field. We consult each other regularly on these matters, both as regards those general policies and as regards specific difficult cases. I am entirely satisfied both as to the correctness of the principles in accordance with which the director has taken his decisions and with the information which I have received from the director as to the decisions taken in individual cases."
I consider that to be an important aspect of the whole issue of the so-called supergrass trials because it puts right in the centre of responsibility and accountability this Parliament and the Attorney-General as regards the information that should proceed in respect of the practice and the principles of the supergrass trials.
In addition, it is on the basis of that statement to Parliament and the responsibility and accountability of the Attorney-General to Parliament, that I consider that my noble friend Lord Longford has acted in the public interest and in the best interest of democracy and human rights by tabling this Unstarred Question this evening. At the same time, I know that my noble friend will respect my point of view if I do not go all the way with what he has proposed in respect of the return of jury courts.
The Earl of Longford: My Lords, I did not deal with that point at all. I mentioned it as one of the matters for concern as indicated by the human rights commission, but I did not offer an opinion myself.
Lord Blease: My Lords, in that case I withdraw my remarks as regards that aspect of the matter.
It is obvious in my view that, notwithstanding the statement by the Attorney- General in October 1983, there is still a considerable amount of misunderstanding, disquiet and controversy about this form of criminal proceedings. I certainly feel that a statement by Parliament, by the AttorneyGeneral—the person with the responsibility and authority to deal with this matter—stressing the practice and the principles ought to have had wider publicity and greater adherence.
Among the organisations which have carried out studies and the monitoring of public opinion in Northern Ireland about the effects of the supergrass

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strategy and public confidence in the judicial system, have been the Northern Ireland Committee on the Administration of Justice, the National Council for Civil Liberties, and the Standing Advisory Commission on Human Rights. It is my view that all three of those bodies have published well researched and reasoned studies of the relevant issues. General public opinion may be best summarised by a special feature article on law and order published in the Belfast Telegraph on 6th February, 1985. The article cited an opinion poll undertaken by the Northern Ireland Consumer Panel. One of the questions which was asked in the poll dealt with supergrasses. The question asked was:
"Do you think that the evidence of supergrasses should be or should not be admissible without corroboration in the trials of those charged with terrorist-type offences in Northern Ireland?"
Those in the Catholic community who thought that they should be admissible accounted for 10 per cent. and those in the Protestant community accounted for 35 per cent. The response as regards them not being admissable was 81 per cent. from the Catholic community and 46 per cent. from the Protestant community. As regards the "don't knows", the Roman Catholics accounted for 9 per cent. and the Protestant community accounted for 19 per cent. The annalysis by the persons who undertook the poll was as follows:
"Protestant opinion is seriously divided on this issue. Large percentages in their responses believe that it should be admissible, should not and also do not know. A high number (19 per cent.) are unsure of their view. By contrast, Roman Catholic opinion is unified, with four out of five people saying firmly that supergrass evidence should not be admissible".
In my opinion, as part of their remit and in response to the public concern, the Standing Advisory Commission on Human Rights in its 1983–84 report gave considerable attention to the issues arising from the supergrass form of prosecution. It went on to indicate that these matters were submitted to the Baker Inquiry on the Northern Ireland (Emergency Provisions) Act 1978. The report also featured a special commissioned study on the use of supergrasses as a method of prosecution in Northern Ireland.
The study was undertaken by a Mr. Jackson, a barrister-at-law, and a Miss. W. A. Russell, a law graduate. Both were qualified and experienced in the practice of criminal proceedings; and I may say that
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the Standing Advisory Commission on Human Rights is a very authoritative body—persons selected for their legal standing, their professional judgment and their experience in the affairs of Northern Ireland. I will quote just briefly from the report of the Standing Advisory Commission. Some of these things have already been mentioned by the noble Lord, Lord Gifford. Among the items which the commission stressed as suggestions for a change in the approach are:
"The D.P.P. should be encouraged to be very discriminating before instituting proceedings against defendants on the uncorroborated evidence of accomplices and should aim towards adopting a practice of instituting proceedings in the main only when there is some corroboration.
"In non-jury trials where the prosecution relies mainly or entirely on the uncorroborated evidence of an accomplice, the court should consist of two judges instead of one and no defendant should be convicted unless both are satisfied of his guilt beyond reasonable doubt.
"Greater priority ought to be given by the authorities to the problem of delays, and particularly to the length of time defendants are remanded in custody before trial".
That is the end of the quotation on human rights, but I would add a fourth: that there should be a much wider discretion in the Attorney-General and the DPP to certify scheduled cases. This suggestion is based on the evidence presented by the Cobden Trust that 40 per cent. of those tried by Diplock procedure had no observable connections with terrorism.
As I understand it, the Government have yet to make known their views on the proposals arising from the Baker Report. I believe that there might be an opportunity for this in June, when the renewed debate on the review of the Northern Ireland (Emergency Provisions) Act is due. I hope the noble Lord the Minister may find it a bit helpful in drawing this to the attention of the Government and in comparing the reaction, not only to the Baker Report and the submissions of the Standing Advisory Commission on Human Rights and others, but to the general feelings of this House, which I believe are a fair reflection of public opinion; that is, that there should be an urgent review of the law concerning the supergrass system. I certainly concur in the closing remarks of my noble friend (and I hope I can call him that on this occasion) Lord Longford and others seeking to make sure of a resurgence of human compassion in respect of freedom and human rights in Northern Ireland.
9.23 p.m.
Lord Fitt: My Lords, my taking part in this debate this evening is certainly not due to any academic interest, but because I believe that this is one of the most serious cases to be brought before this House. Your Lordships' House has for a number of weeks been aware that a debate on the supergrass system was to take place this evening and I am disappointed, to say the least, that there are about one dozen of us here to discuss, debate and pass opinions on what could be regarded as one of the most fundamental decisions by an elected or non-elected chamber. I have listened to my noble friends Lord Gifford and Lord Longford as well as my noble friend—I would hope—Lord Hylton, the noble Viscount, Lord Brookeborough and the noble Lord, Lord Blease.
We live in Northern Ireland. I have no hesitation in saying that of all those who have spoken in this debate today have lived in the heat of the kitchen. For many years I represented West Belfast, which took in both the Republican Falls and the Protestant Shankhill. I also lived on the Antrim Road in North Belfast where my house was continuously under attack by the Republican element in the latter years of the 1970s, but in the latter years of the 1960s it was under attack from so-called Loyalist forces.
I remember well the 1970s. Every morning you would read the newspapers, or listen to the Northern Ireland news broadcasts, or hear the shots, which is even more emotional. I heard the shots many times from my house on the Antrim Road; shots which led to the death of policemen, innocent civilians, and members of the security forces right behind my own back door and in front of my own house. The first British soldier to be killed in Northern Ireland, Gunner Robert Curtiss, was shot only yards from my home.
I lived with it. It is not an academic exercise when I read about this, and I worry about British jurisprudence and whether it is right that this should be done. I lived with the effects of terrorism in Northern Ireland. During those years everyone who lived around where I lived on the Antrim Road, on the New Lodge Road to Unity Flats, knew that when members of the security forces or others were killed the next morning the rumours would go around the district as to who it was. I am sure that some people were telling the police who it was, but there was no evidence. Everyone who lived in those Catholic ghettos was well aware who was responsible for carrying out the murders. We all suspected.
Then after a number of years the Christopher Black trial took place. Christopher Black, as my noble friend Lord Gifford, has said, implicated 38 others in his trial. It was the first supergrass trial to take place. My noble friend Lord Gifford has said that he has lots of pages of evidence. I did not go to watch that case, but I read about it avidly.
All the people, 100 per cent. of them, who were implicated in that trial were people who I knew were on the fringe. They were all found guilty on the evidence of Christopher Black. Like my noble friend Lord Gifford I did not like the fact that Christopher
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Black, after giving his evidence, was exonerated. Some people say that he is now living in South Africa, that his fare was paid for him, that the Northern Ireland authorities paid for him to leave the country. I did not like that. I do not believe that anyone involved in murder and maiming should be given any facilities by the police. But the fact is that the evidence which he gave was responsible for taking out of circulation in Northern Ireland some of the most dangerous men who have ever walked the streets of Belfast.
I know what Lord Justice Kelly said to Christopher Black. He said words to the effect, "You are an evil man. I detest all the activities that you have been involved in. There is no one in any doubt that you have been involved in the most vile of crimes, but I cannot disregard your evidence." He could not disregard his evidence. Therefore, 38 people were convicted. That was the first supergrass trial.
I believe that the evidence given by Christopher Black, the evidence accepted by the courts, was unassailable. Since then we have had a whole series of supergrass trials. My noble friend Lord Gifford says that Christopher Black went in and his evidence could not be broken down under the most serious and acute cross-examination by some of the most eminent lawyers in Northern Ireland. I refer in particular to Dick Ferguson, one of the most acute cross-examiners in Northern Ireland. He could not break down Christopher Black's evidence.
In my opinion Christopher Black was an evil man. I had the same opinion as the judge. My noble friend said that Christopher Black was programmed. He implied that he was programmed, that he had given his evidence to the police and therefore he was able to stand up under the closest examination. We accept that. If a supergrass is not as programmed as some people would like to convey that he is and he breaks down, they say, "He was telling lies all the time". If he sticks by his evidence, it is said that he was programmed by the police. If he does not stick by his evidence or is proved to be telling lies, it is said that his evidence is unsafe. Thus there is no way the authorities can win.
Christopher Black was given money and a safe passage, some people say, to South Africa. There are others in prison in Northern Ireland who have committed multiple murders who have nothing to gain. They receive nothing from the police, nor are they given safe passages. One of the supergrasses who has been responsible for implicating others is in gaol for five murders. He will spend the rest of his life in gaol; at least I hope he will. He has nothing to gain. The argument against that would be that although he has nothing to gain, he is getting his own back on his former associates.
Lord Gifford: My Lords, the noble Lord will know that that man—one must speak with caution because the trial is still pending—is someone who received a life sentence for his five murders with no minimum term, so he can hope to be released early by the authorities. That is his incentive.
Lord Fitt: My Lords, I hope that he would not be released in any circumstances or that he would not be

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given any promise of release. I am totally opposed to capital punishment but I believe that a life sentence for murder should mean exactly what it says—that it should be a life sentence.
I remember well when I was a Member of another place when the emergency provisions legislation was going through the House. I opposed the abolition of juries because I would like to think, living in a part of the United Kingdom— there is great dispute about that in relation to Northern Ireland—that we would have exactly the same rights under British justice. I was well aware that at the time juries were under tremendous pressure from threats of intimidation.
Those who know what is happening in Northern Ireland will be aware that a trial in Northern Ireland last week involved intimidation. Paramilitary forces were intimidating builders and demanding protection money from them. The witnesses, the people who were intimidated into giving money for the paramilitary organisation, had to go into Northern Ireland courts last week wearing masks. The masks they wore put them into the same league as the terrorists who had been intimidating. That gives some indication of the intimidation that is taking place. Men who have been intimidated at the point of a gun by Loyalists and Republicans were so frightened for their lives that they had to go into a Northern Ireland court last week wearing the mask of a terrorist to save their own lives. I believe that that effectively answers why there cannot be juries in Northern Ireland.
I readily accept that the supergrass system is not the best system available. I believe that some people have been implicated for all the wrong reasons by some of the supergrasses. Within paramilitary organisations the people involved, be they Loyalists or Republicans, are not Sunday school teachers. They are not the best type of citizens that we know in any part of these islands. The people involved either as Republicans or Loyalists are not the best type of character. It has already been said here tonight that their evidence must be treated with extreme caution.
It is understandable that some of the people turned to becoming supergrasses—and, by the way, the term "supergrass" is particularly offensive to me. It is a term derived from the English or American underworld, the world of thievery and criminality. Certainly in Ireland the majority of people involved in terrorist offences are involved because of some nationalistic claim. But there are other people who are total and absolute gangsters, both on the Republican and on the Loyalist sides.
So we are faced with the situation: Do the police try to use the supergrass system, or do they throw the whole thing out? Do they say, "Under no circumstances will we accept the word of an accomplice"? I do not think it would be right to ask the police to do that.
The Earl of Longford: My Lords, no one is going as far as that. I said at the beginning that the word of the accomplice has been accepted in English law for many years. I am talking about the uncorroborated evidence.
Lord Fitt: Yes, my Lords; but there are circumstances in Northern Ireland where the only evidence available is the uncorroborated evidence. For example, let me go back to what I said a few moments ago. A gunman went into a builder's office. The builder was in charge of a building site in Northern Ireland. The man pulled a gun on him and told him that he would kill him if he did not give him so much money every week or every month. In a normal society that builder, when the man was apprehended, would be able to go into court and stand there and say, "Yes, I identify that man as the person who pointed a gun at me and who demanded money of me". But he cannot do that in Northern Ireland because he is afraid of being intimidated and killed. And I do not believe that the masks that they all wore last week will have any real effect because the gunman is quite well aware of the person he pointed the gun at. Whether or not he is sitting in the court wearing a mask, the gunman will be able to tell his accomplices outside who it was he pointed the gun at.
I come to the Diplock courts. Again, I disagreed when the Diplock courts were set up. I believe that there should be two or three judges sitting. The argument against one judge is that he may become case hardened; that he hears so many of these terrorist cases that he becomes hardened against them. I would only say, because of the integrity of the men that I know—the Lord Chief Justice of Northern Ireland and all the other judges—that I do not believe that they are case hardened. I believe they are dealing with a particular situation; and the very fact that they have thrown numbers of cases out of court is an indication that they will go through the evidence which is presented to them minutely and with a fine toothcomb.
Let me say to my noble friend Lord Gifford that the fact that you have juries in this part of the United Kingdom is no sure indication that all the verdicts that come from juries are 100 per cent. correct. There is the Annie Maguire case, which was notorious here and throughout the United Kingdom, in which eight people were given very long terms of imprisonment on very doubtful forensic evidence. They were convicted by a jury, but those people were absolutely and totally innocent of something about which this House is going to hear a great deal more in future. The very fact that there is a jury does not mean to say that you will get a just verdict in all situations.
This debate is about the most elementary of all the facets of life under which we live: the right of people to live under the law. I repeat that it is not an academic exercise. The judges in Northern Ireland, the population in Northern Ireland, have lived in desperate and tragic circumstances over the past number of years. Paramilitary organisations have taken control of different areas, different districts and different ghettos, particularly in my own city of Belfast, and they have intimidated many people. Many people live in fear.
My noble friend Lord Blease quoted figures given in a survey about the attitudes of Catholics and Protestants to the supergrass system. I can only say this—and I would hope that I am right. The vast majority of Catholic and Protestant people living in

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Northern Ireland are sick, sore and fed up to the teeth with the activities of paramilitary organisations. If the supergrass system as we know it, imperfect as it is, is responsible for taking out of circulation some of the most dangerous men who have ever trodden the soil of Ireland, then I would be the last to call for its immediate withdrawal. I would say that the judges and the whole judicial system in Northern Ireland should be very careful indeed of the uncorroborated evidence of a supergrass: but do not let us reject that evidence entirely, because by accepting the evidence, in many cases, it will lead to the saving of lives.
9.42 p.m.
Lord Prys-Davies: My Lords, my noble friend Lord Longford, in a strong and powerful speech, has drawn the attention of the House to an aspect of the legal system in Northern Ireland which is the cause of unease for sectors of the public. How large the sectors are, I am not sure; but certainly it has caused unease for sectors of the public in both the Catholic and Protestant communities of Northern Ireland. I believe that my noble friend is right to bring the matter before the House, and we are immensely indebted also to my noble friend Lord Gifford for his powerful speech and for the powerful light which he has thrown on this corner of the law in Northern Ireland. He probably knows more than anyone else outside the security forces how the system is working. I believe that his report will soon be a work of reference.
I should like to emphasise that one should not be thought to be "soft" on terrorism in challenging the working of the supergrass system in Northern Ireland. My noble friend has asked his Question not because of a sympathy with terrorism: indeed, he has acknowledged this evening that he condemns violence, and all of us who know him well know that he condemns violence. He has asked the Question because, on the evidence available, he fears that for many innocent people who are charged with acts of terrorism or with one of the scheduled offences, the spring of justice may be drying up.
In assessing the working of the Diplock courts in Northern Ireland, we appreciate that a balance has to be maintained between, on the one hand, the protection of the public against terrorism and, on the other hand, the maintenance of civil liberties. I would agree with those noble Lords who have expressed the view that there are immense difficulties in striking the right balance. We should not underestimate those difficulties.
It has been said that one of the underlying policies of the emergency legislation in Northern Ireland was to make certain changes in the judicial process which would tend to an increased conviction rate, while not depriving the person accused of terrorism of his right to a fair trial. My Lords, have these two policy objectives been achieved? We have heard how the policy led to the Diplock trials, trials by a judge alone, and one appreciates that this places a heavy burden on the judge. Of course, a jury is not always a perfect instrument, but we on this side of the water have learned that a jury is a very powerful shield for the
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innocent. So jury trials in terrorist cases have now been suspended for 12 years.
But there is more to it than that, because since 1981 the Diplock trials have relied heavily, although not particularly successfully, on the uncorroborated evidence of one witness who had been an accomplice. Therefore we are right to ask whether this double movement—the suspension of the jury system and the reliance on the uncorroborated evidence of this one witness—imperils the right of the accused to a fair trial. We come back to the basic theme which underlined the speech of my noble friend Lord Longford.
My noble friend Lord Longford concentrated, in particular, on the use made of the uncorroborated accomplice's evidence, and he described it as an outstanding evil in the system. But he and other noble Lords referred to other features which cause concern about the use of such evidence in Northern Ireland, and I summarise them.
First, since 1981 the police have sought to rely very heavily on the evidence of the supergrass in the enforcement of the security system. This appears to represent a departure from the pre-1981 policy, although there is some evidence that that strategy may not have been prosecuted so vigorously during the past six months as in the period from 1981 to 1984.
Secondly, the system is suspect because of the character of the accomplices. They are not men of high quality. They are unsavoury characters. The Northern Ireland judges have had an opportunity of assessing these star witnesses who have come on the scene since 1981, and their assessment is to be found in the report of my noble friend Lord Gifford. The assessment is very helpful, and let me take some instances. One has been described by a judge as,
"a man who has committed murder and did not have scruples about committing perjury if it suited him."
The evidence of another was described as "contradictory and bizarre". Yet another was strikingly illustrated by the judge as "living in a pretence".
Thirdly, the system is open to grave abuse, because of the benefits which the witness gains from giving his evidence. We have heard from my noble friend Lord Gifford how the witness turns Queen's evidence in exchange for immunity from prosecution for his own serious criminal conduct, in gratitude for present and future favours, especially the offer of a new identity or a job elsewhere. This is quite a nice bargain for the supergrass, so there are very powerful reasons to falsify evidence in order to obtain these advantages.
Fourthly, of the 400 to 500 men and women from Republican and Loyalist backgrounds, named by supergrasses and arrested since 1981 on terrorists charges or the scheduled charges, there have been no more than about 80 convictions. The Minister will correct me if the figures are not right, but that is my understanding of the position. This is so exceptional and unsatisfactory that the system upon which it is based cannot stand unchallenged.
This record tells us nothing about the length of time during which the arrested were detained although they were pleading their innocence. I have read that the average period of detention has been four to five weeks

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although many have been on remand for more than two years. My noble friends Lord Longford and Lord Blease have again drawn attention to the fact that such detention may be disastrous for an accused person.
I have dwelt upon the weaknesses of the supergrass system. Supergrasses are yes-men; not daring to cross the prosecution, they swim with the prosecution's tide. Their bargain with the prosecution is to their own advantage; but it is to the disadvantage of the accused and often amounts to injustice for many. So why do the security forces continue with this system?
Like the noble Viscount, Lord Brookeborough, and my noble friends Lord Blease and Lord Fitt, who live in the community and who have to face the perils there from day to day, I have no wish to be unfair to the police. I accept, with other noble Lords, that the police have a very difficult task to discharge, and we must not underestimate their difficulties. We have heard tonight how the system helps the police to collect valuable information about suspect terrorists; and to find weapons; and to help put suspects against whom there is a very great deal of circumstantial evidence out of circulation for a long time. That point was made by my noble friend Lord Fitt.
There possibly, and there probably, is the key to the policy. But it must not be overlooked that this policy may be and probably is unjust in the case of innocent individuals who have been arrested on the uncorroborated evidence of a single witness. Moreover, there is evidence that the system is turning some communities against the security forces. But whether this provides a common ground upon which the affirmatives in Northern Ireland can be brought together, as my noble friend Lord Longford seemed to suggest, I do not know. The noble Lord, Lord Hylton, has caught a glimpse of another development which may in the long term have great significance for the Province. But today we are concerned with the legal system in Northern Ireland and its imperfections.
I trust that when the Minister replies to this debate he will acknowledge the strength of feeling on this issue which has been brought into focus by my noble friend. If we have failed to convince the Minister of that unease, then we have failed in this debate. Even if the Minister cannot go so far as my noble friend would wish him to go, and even if he cannot tell the House that the supergrass system will be scrapped or that trial by jury will be re-established, at least for cases based on the evidence of an accomplice—and I accept the point made by the noble Viscount, Lord Brookeborough, and by my noble friend Lord. Fitt that such may be unrealistic today—I hope he give the House assurance that the Government are giving consideration to the introduction of some or all of the following changes: that the evidence of an accomplice should always be corroborated in some material respect; that the terms of the bargain between an accomplice and the prosecution should be agreed before the accomplice gives his evidence, and that such terms should not be secret but should be known to the court and told to the accused; that there should be a substantial reduction in the delay in bringing the accused to trial; and that there should be a substantial reduction in the number of defendants who are tried together on one indictment.
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One last word, my Lords. This is essentially a debate about the rights of the individual to justice according to law when that individual finds himself in an extraordinarily difficult situation. I suggest that we should not allow the extraordinary situation to destroy or undermine our system of justice. It is our duty to preserve our common law in the interests of the individual, in the interests of the community and in the interests of the country at large.
9.55 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell): My Lords, I am sure your Lordships' House wishes me to express gratitude to the noble Earl, Lord Longford, for introducing this really informed and, I believe, constructive debate which we have had this evening. I was also particularly pleased to see that the noble Earl who has put forward this Question to the Government took the opportunity, as he told us, and as I heard from the lips of the Chief Constable of the Royal Ulster Constabulary—to whom I shall pass on the noble Earl's compliments and admiration—to visit Belfast recently to see the courts in operation and to observe for himself the processes by which justice is done in Northern Ireland.
This evening, of all evenings—and I am sure the noble Earl will forgive me—I invite the House to join with me in expressing our sympathy and condolences to those who have been injured or bereaved by this morning's non-warning car bomb outside the courthouse in Newry. One reserve policeman was killed outright and the civilian doorman was fatally injured. Another policeman was also seriously injured. This crime reminds us yet again, if, indeed, we need further reminder, that the shadow of the terrorist lies athwart the doors of the courts in Northern Ireland.
The terrorists have set themselves up as judge, jury and executioner. Indeed, the terrorists offer no safeguards for their intended victims. The task of bringing these terrorists to book for such crimes is an onerous one. The courts bear a considerable share of the strain. However, it is the determination of the Government, the security forces and, above all, the courts to maintain the rule of law which will, at the end of the day, defeat the terrorists and bring their plans to nought.
I return to this evening's debate and the Question which has been asked by the noble Earl. The debate has been highly informed and highly interesting but it has exposed one or two misconceptions which it might be best for me to correct immediately. Two of these are contained in the Question put down by the noble Earl, which refers to the working of what the noble Earl calls the "supergrass system". Far be it for me to enter into debate with the noble Earl or, indeed, your Lordships about the term "supergrass". We have heard how this term is used in the underworld across the Atlantic. However, I would mention in passing that the term "former accomplice" is one which more accurately describes the status of such witnesses.
I take strong issue with the allegation that there is a "system". There exists a group of cases which share certain common characteristics and it is even possible to a limited extent—I emphasise the word

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"limited"—to study and talk about such cases in isolation from others. However, I believe your Lordships will agree that the word "system" implies a deliberate policy or process which does not, in fact, exist. There is no "supergrass system".
The position is simple. If the police have good evidence, of whatever nature, to link a person with serious terrorist crime, it is their duty to bring charges as soon as they are able, and in due course to lay the facts before the Director of Public Prosecutions. It is the duty of the director, who of course acts independently of the Executive, to consider all the evidence and information before him with a view to the initiation of criminal proceedings, including cases where the evidence of a former accomplice forms an important part of the prosecution case.
The Earl of Longford: My Lords, will the noble Lord give way?
Lord Lyell: Briefly, my Lords, and just once.
The Earl of Longford: My Lords, I wanted to refer the noble Lord to Appendix C of the report of the Standing Advisory Commission, which is headed:
"The use of supergrasses as a method of prosecution in Northern Ireland".
Just on the semantics of it, I think he has been a bit hard on me.
Lord Lyell: My Lords, the noble Earl should know that I am never unduly hard. The umpire in this game is indeed your Lordships' House. I stand by what I said. There is no system. I think that he is drawing semantic points. We may discuss this later if he will permit that.
The director must consider each case on its own facts and in the light of the interest of the public that criminals, and particularly dangerous criminals, as we have heard from the noble Lord, Lord Fitt, should be brought to justice. Where the evidence, whatever its nature, appears to be credible and cogent and relates to serious terrorist crime, there is an overriding public interest in having charges brought before the court. It is not the function of the director to decide guilt or innocence. All he can decide is whether the evidence merits being put before the court for adjudication. If the evidence of a former accomplice is part of the prosecution case, it is for the court to determine, as it does in respect of any evidence, whether it is so convincing as to its contents and so reliable in itself that it reaches the standard of proof beyond reasonable doubt.
It may assist your Lordships to appreciate the force of my contention that there is no "system" if I give some figures which I believe will not directly clash with others quoted this evening. I think that the noble Earl would agree with them, and anybody else who has studied this question would concede that they are right.
In 1983, 1,139 cases were disposed of on indictment in Northern Ireland. Most of these were heard before a jury in the normal way, but 285—that is approximately 25 per cent.—were treated as cases involving "scheduled" offences and tried by a court sitting
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without a jury. Only four of these cases—that is 1·4 per cent. of the total number of cases—were cases in which a former accomplice gave evidence on behalf of the Crown. In 1984, 1,085 cases were disposed of on indictment; 266, or 24.5 per cent., were treated as scheduled cases; and only three-1 per cent. of the total—involved evidence from a former accomplice. I believe that those figures are relevant to the Question asked this evening by the noble Earl.
The noble Earl also asked whether the Government are satisfied with the working of the judicial processes in such cases. I would say to him that there can be no question of the Government being either satisfied or dissatisfied with decisions which have been made by courts. What the Government are satisfied of is that the legal framework within which the police, the prosecuting authorities and the courts operate is sound and enables justice to be done. I am satisfied that justice is being done, and according to the very high standards set by the judicial systems of Great Britain and Northern Ireland.
The law of Northern Ireland, like that of England and Wales, approaches the evidence of accomplices with the utmost caution. In a trial before judge and jury, it is the practice for the judge to give a precise warning in his charge to the jury that, although it is open to them to convict on the uncorroborated evidence of an accomplice, it is dangerous to do so. It is further his duty to analyse the evidence and to point out to the jury what, if believed, could or might amount to corroboration, implicating the accused in the evidence actually before it. This places a particularly difficult burden on the shoulders of a trial judge presiding over a trial for one of the scheduled offences which, at least for the time being, has to take place without a jury.
The trial judge must first give full effect to the warning which he would otherwise have given to the jury, and he must then ask himself the very questions he would otherwise have posed. First of all, he must ask: is there credible evidence which could amount to corroboration, were it accepted? Secondly, is he in fact satisfied of its truth? Finally, and most difficult of all, if there is no such corroboration, is the evidence, in such circumstances uncorroborated, of the accomplice so convincing that the judge is satisfied so that he is sure of the guilt of the accused?
It is clear to me, it is clear to the Government, and I believe it is clear to all who, with experience have followed this matter, that, throughout the period of the Diplock and so-called supergrass trials the judges charged with the matter have approached their delicate and responsible task with meticulous and scrupulous care. In particular I would refer the noble Lord to the judgment of the Lord Chief Justice of Northern Ireland given on 26th October 1983 in the case of Gibney. That illustrates and demonstrates the conscientious skill with which the courts ensure that no one is convicted except on proof beyond reasonable doubt. I would reassure the noble Earl, and, indeed, your Lordships, that a transcript of this judgment will be placed in your Lordships' Library.
I wish to say one or two more words about uncorroborated accomplice evidence. It is admissible in courts in Great Britain and in many other countries,

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including the Republic of Ireland and the United States. Yet it has been suggested this evening in your Lordships' House and elsewhere, that the Government should legislate to make such evidence inadmissible in Northern Ireland.
The Earl of Longford: My Lords may I interrupt the noble Lord?
Lord Lyell: My Lords, may I just finish?
The Earl of Longford: My Lords, I do not think—
Lord Lyell: No, my Lords; if the noble Earl makes sedentary remarks, it breaks up the speech. I am not a lawyer and I do not think he is. Will he just pause? He has said that he wishes to interrupt. I believe that I am on the verge of being too good mannered, but I shall finish this paragraph and then let him say what he wishes. I am in the middle of trying to deal with uncorroborated evidence. I do not think that for the Government to legislate to make evidence inadmissible in Northern Ireland would be in the interests of justice. It would require courts in Northern Ireland to disregard evidence which might be cogent and material, and which might otherwise lead to the conviction of persons for very serious crime. I would remind your Lordships and above all the noble Earl, that such accomplice evidence, although sometimes uncorroborated, is never put forward unless it is supported by other evidence—for example, of the commission of the offences in question—which, while not strictly corroborative, nonetheless tends to confirm the accomplice's story. I do not think that Parliament should supplant the discretion at present accorded to the courts to accept, reject or give such weight as they see fit to such evidence, with a rigid rule that no such evidence should ever, in any circumstances be admissible—
—I yield to the noble Earl just once.
The Earl of Longford: My Lords I want to make a rather important point. The noble Lord has suggested that uncorroborated evidence is admissible in England. In law it is admissible but I understand—and I have confirmed this with several lawyers before making my remarks—that the use of it has died out here to all intents and purposes.
Lord Lyell: My Lords, the noble Lord mentions "to all intents and purposes", but I understand that my remarks still stand.
The noble Lord, Lord Gifford, raised the question of the grant of immunity to former accomplices. This issue is a matter for the law officers, not for me, and I would commend to the House the written reply which was quoted by several of your Lordships, which was given in another place by my right honourable and learned friend the Attorney-General on 24th October 1983. That reply sets out very fully the criteria which are observed by the Director of Public Prosecutions when considering the grant of immunity in particular cases. I would not want to add anything to that.
The noble Lord, Lord Gifford, in the course of his notable speech, also raised the question of possible
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inducements to accomplice witnesses. Again, I should draw your Lordships' attention to the reply of my right honourable and learned friend in another place on 24th October 1983. This sets it out clearly that the details of any financial arrangements that may be made before a trial for the protection and, when appropriate, the resettlement of a witness must be available to the court at the time of the trial. It is for the court to form a view of the probative value of the witness's statement in the light of all the information before it.
Your Lordships have made reference (I think it was the noble Lord, Lord Blease, who mentioned it) to the length of time that sometimes occurs before certain cases come to trial involving the evidence of alleged former accomplices. The Government are most concerned about any delays in the judicial process. The recent appointment of 12 additional senior counsel and the forthcoming appointment of an additional county court judge are measures designed to speed the process of justice. That said, it must be recognised that cases involving accomplice evidence are subject to particular difficulty, most obviously from the need to complete the hearing of proceedings against the accomplice before the cases against others can be heard. This imposes a regrettable but, I have to say, necessary delay on the principal case.
I am also aware that in a small number of cases the continued detention of suspects on the evidence of successive former accomplices adds to the length of detention in custody and does give cause for concern. But, equally, if the police have evidence that someone has been involved in serious terrorist crime and the courts, because of the nature of the charges brought and the other factors which they are required to consider, decide that that person cannot properly be released on bail, then both in logic and I believe in law there is no alternative but to retain that person in custody until his case comes to trial.
Finally, I would wish to remind the House of the context in which this Question has been asked this evening. Northern Ireland has suffered 15 years of terrorist violence. There are undoubtedly people on the streets in Northern Ireland who have been guilty of the callous murder of members of the security forces or, indeed, of innocent members of the public; of the bombing of property, both commercial and domestic; and of grave and brutal sectarian murders. Witnesses have been intimidated. The silence of those who question the terrorist cause has been enforced by the brutal murder of so-called informers. It stands greatly to the credit of the security forces, of the prosecuting authorities, of the courts and of the judiciary that they have weathered this storm while maintaining the standards of justice which are recognised and applied on both sides of the Irish Sea. Recent cases have made clear that if cases brought against alleged terrorist offenders do not meet the standard of proof beyond reasonable doubt, then they will not be upheld by the courts.
I would wish to assure your Lordships that the splendid record of the judiciary of Northern Ireland has not passed without notice on this side of the water. I am most grateful to my noble friend Lord Brookeborough for providing me and, I believe, all

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your Lordships with this opportunity to pay tribute to the way in which the Lord Chief Justice, in particular, and all the judges and magistrates at every level in Northern Ireland, are dealing with the present troubles. Judges in Northern Ireland, as your Lordships will be aware, face unusual difficulties and dangers. Their colleagues have been attacked and even murdered, some on the steps of the very church at which they had just partaken of the Sacrament, others at their homes before the faces of their families.
Many things have been devalued as a result of the violence that has taken place in Northern Ireland over the last 15 years. The impartiality and the integrity of the judiciary and of a united and independent legal profession which rises above political difference and religious obedience in defence of law and, above all, justice, remain unimpaired. It is thanks to their courage, their dedication and their skill that law in Northern Ireland is being administered with fairness and firmness. I am sure that everyone in your Lordships' House will want to join me in extending to the judiciary of Northern Ireland our gratitude for their fortitude.
In his Unstarred Question the noble Earl has asked whether the Government are satisfied. My Lords, I am satisfied that justice has been and will continue to be done in the Northern Ireland courts.

Berkshire Bill [H.L.]
Petition against the Bill from the British Retailers Association withdrawn: the order made on 19th February last discharged and the Bill recommitted to a Select Committee on Unopposed Provisions.
National Bank of New Zealand Limited Bill
Reported from the Unopposed Bill Committee with amendments.
Lloyds Bank (Merger) Bill
Reported from the Unopposed Bill Committee with amendments.
Royal Holloway and Bedford New College Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.
Gosport Borough Council Bill
Reported from the Unopposed Bill Committee without amendment.

South Yorkshire Passenger Transport Bill
Brought from the Commons, read a first time, and referred to the Examiners.
House adjourned at a quarter past ten o'clock.

  BOARDS OF VISITORS: CONDUCT OF ADJUDICATIONS
  BOARDS OF VISITORS: CONDUCT OF ADJUDICATIONS
  MISS HILDA MURRELL
  MISS HILDA MURRELL
  VOLUNTARY SERVICES UNIT: GRANTS TO NORTHERN IRELAND BODIES
  VOLUNTARY SERVICES UNIT: GRANTS TO NORTHERN IRELAND BODIES
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  MOTORWAY SERVICE STATIONS
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  COAL MINING: SUBSIDENCE COSTS
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  FLEET HOLDINGS: UNITED NEWSPAPERS' BID
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  GENERIC MEDICINES: QUALITY CONTROL
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  GPs' TERMS OF SERVICE: ALTERATIONS
  GPs' TERMS OF SERVICE: ALTERATIONS