Sitting of 21 February 1985

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

PRIVATE BUSINESS
Mr. Speaker: Order. As all the private Bills have blocking motions, I shall, with the leave of the House, deal with them in a single group.
BRITISH RAILWAYS BILL (By Order)
BIRMINGHAM CITY COUNCIL BILL (By Order)
CAMBRIDGE CITY COUNCIL BILL (By Order)
C-POULTRY COMPANY LIMITED BILL (By Order)
FELIXSTOWE DOCK AND RAILWAY BILL (By Order)
GREATER LONDON COUNCIL (GENERAL POWERS) BILL (By Order)
HARROGATE STRAY BILL (By Order)
LINCOLN CITY COUNCIL BILL (By Order)
PLYMOUTH MARINE EVENTS BASE BILL (By Order)
SCARBOROUGH BOROUGH COUNCIL BILL (By Order)
STREATHAM PARK CEMETERY BILL (By Order)
YORKSHIRE WATER AUTHORITY BILL (By Order)
Orders for Second Reading read.
To be read a Second time upon Thursday 28 February.

Oral Answers to Questions
  NATIONAL FINANCE

    Medium-term Financial Strategy
    Mr. Bellasked the Chancellor of the Exchequer when he expects to achieve his targets as regards sustainable growth and jobs, as set out in the medium-term financial strategy.
    The Chancellor of the Exchequer (Mr. Nigel Lawson): Output has been growing steadily for the best part of four years and employment has been rising since the first quarter of 1983. With inflation under control, those trends are expected to continue.
    Mr. Bell: The nation will not recognise the picture that the Chancellor of the Exchequer painted. Does he agree
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    that output has not yet reached the level of 1979 when the Labour Government left office? Does he agree that the medium-term financial strategy had three elements: the conquest of inflation, sustainable growth, and job creation? Is it not a fact that they are mutually exclusive, that he has not conquered inflation, or achieved sustainable growth, and that he cannot create jobs? When will the Chancellor tell the House that he is abandoning the medium-term financial strategy?
    Mr. Lawson: From someone who is normally as well informed as the hon. Gentleman, I have never heard so many errors in a single question. First, output, far from not having reached the 1979 peak, exceeded the 1979 peak in 1983, went still higher in 1984, and is expected to go higher still in 1985. The latest figures for employment published only yesterday show that during the 18 months to September 1984 there was an increase of about 480,000. That is a substantial increase, in which an increase in self-employment has played a large part. My right hon. and hon. Friends will be glad to know that. Far from the conquest of inflation being incompatible with a healthy economy, growth and more jobs, it is one of the essential elements in the foundation for more jobs, although there are also other elements.
    Mr. Forman: While I welcome the Government's record since 1981 in boosting both output and employment, does my right hon. Friend believe that there is a place now for treating the public sector borrowing requirement calculation on an oil-adjusted basis?
    Mr. Lawson: I read with great interest the pamphlet written and published by my hon. Friend and my hon. Friend the Member for Lewisham, West (Mr. Maples). Many adjustments must be made to the PSBR in different directions to decide on an appropriate level. Those adjustments were all made. The factors were all taken into account when the last medium-term financial strategy was published in March 1984.
    Mr. Wainwright: Since the Chancellor recently published a careful study of the effect on the number of jobs of lower employment costs, will he tell the House approximately how many new jobs he reckons will have resulted from the abolition of the national insurance surcharge last year?
    Mr. Lawson: It is extremely difficult to put a figure on that, but the same factor would broadly apply as applied in the Treasury paper, that is, the 1 per cent. lower level of real earnings would over time be expected to result in between 110,000 and 220,000 additional jobs.
    Mr. John Browne: Does my right hon. Friend accept that, in the light of the world recession and the decades of industrial decline that preceded this Government's tenure of office, his financial strategy is working well in the national economic interest? Will he acknowledge the great role being played by new and small businesses in the creation of jobs within the economy? Furthermore, will he have regard to the wishes of my constituents that that should be taken into account in the forthcoming Budget?
    Mr. Lawson: I always take my hon. Friend's representations very carefully into account when framing my Budget.

    Imports
    Mr. Cowansasked the Chancellor of the Exchequer if he has made any estimate of the impact of (a) tax cuts and (b) public sector construction spending on imports.
    The Chief Secretary to the Treasury (Mr. Peter Rees): It would be misleading to look at tax and expenditure decisions solely in terms of their relative import content. What matters is whether tax or expenditure decisions will contribute towards improved economic performance.
    Mr. Cowans: Has the Minister read the input and output tables of the Department of Trade and Industry, which show conclusively that public sector construction is less import intensive than tax cuts? Will he now at last treat jobs as the main priority instead of putting forward his own pet theories?
    Mr. Rees: Any addition to disposable income will go on imports, and that is true of higher wages as well as of additional income due to tax cuts. If the hon. Gentleman is consistent in his view, he is presumably also opposed to wage increases on the ground that they, too, suck in imports.
    Mr. Beaumont-Dark: Does my right hon. and learned Friend accept that it is not only tax cuts that have an effect on the economy, and that the Government are right not to set themselves a harsh target on the value of the pound, as many of the things that have happened have been very helpful to manufacturing industry, which in turn helps to strengthen the economy? Anyone who thinks that having a set target for the pound helps this country just does not understand the facts of economic life.
    Mr. Rees: My hon. Friend is quite right. The export opportunities to, for example, the United States are enormous at present. Hon. Members will know that, even disregarding oil, the volume of exports rose by 9·5 per cent. in 1984 to reach an all-time high.

    Infrastructure
    Mrs. Clwydasked the Chancellor of the Exchequer how many representations he has received concerning the need for more public spending on the infrastructure.
    Mr. Peter Rees: Several.
    Mrs. Clwyd: The Minister has already accepted that tax cuts will not necessarily create jobs, but does he realise that there is evidence to show that money spent on the infrastructure would create two and a half times as many jobs as money spent in tax cuts? Will he accept that public spending is a necessary part of job creation?
    Mr. Rees: I certainly accept that public spending can create jobs, but if the hon. Lady reflects for a moment she will realise that economies, such as the economy of Japan, which carry a low rate of public expenditure and a low tax burden are performing rather well, and are therefore creating more jobs.
    Mr. Neil Hamilton: When considering public expenditure on the infrastructure, will my right hon. and learned Friend bear in mind the return produced thereby? The last thing that we want is more fiascos like that of the Humber bridge, which act as a drain on the economy and destroy jobs in the long term?
    Mr. Rees: My hon. Friend is absolutely right. Capital projects are bound to be looked at on an individual basis. There can be no absolutely correct level of capital expenditure on infrastructure projects. Each project must be looked at on a case-by-case basis to see whether it is likely to yield a proper return.
    Dr. McDonald: Is the Minister aware that capital investment has fallen as a proportion of gross domestic product from an average of 19 per cent. under Labour to an average of 17 per cent. over the past four years? Is he further aware that Britain is now at the bottom of the investment league of major industrial countries? Is it not high time that he listened to the voices of industry, the unions and Members of Parliament of both parties and stepped up investment in our decaying infrastructure in order to provide real jobs and to make our economy more efficient?
    Mr. Rees: If the hon. Lady was not mesmerised by the public sector—we all know her penchant for an East European economy — she would realise that capital investment is running at an all-time high.
    Sir William Clark: Will my right hon. and learned Friend remind the House that if our public sector borrowing requirement were increased to provide more infrastructure investment it would put an added strain on the nation's finances, since the national debt costs taxpayers about £17 billion a year to service? Consequently, does he agree that anybody asking for increased public expenditure must realise that it would put further strain on taxpayers?
    Mr. Rees: I accept my hon. Friend's analysis. He appreciates, just as I and other Government Members do, that by giving more scope for manoeuvre in the private sector we are creating scope for investment in that sector which can make for a more effective economy.
    Mr. Donald Stewart: If, as is alleged, the main sewers are collapsing in all our main cities, does that not take care of all the dogmatic theories on both sides of the House?
    Mr. Rees: I have to confess that I cannot talk with authority about the main sewers in Portree on the Isle of Skye, but I can tell the right hon. Gentleman that nearly £1 billion of public investment will be spent on water and sewerage services in 1985–86.

    Capital Investment
    Mr. Kenneth Carlisleasked the Chancellor of the Exchequer what are the latest figures available for the levels of capital investment in the United Kingdom.
    Mr. Lawson: Total fixed investment in the economy is reckoned to have reached about £55 billion in 1984, an all-time record in real terms. It is forecast to rise higher still this year.
    Mr. Carlisle: I thank my right hon. Friend for that reply. Does he agree that one of the best indicators of the direction of the economy, of confidence in the future and of hope for jobs is the level of capital expenditure in manufacturing industry? What are the trends here?
    Mr. Lawson: That certainly is one of a number of important indicators. My hon. Friend is right to refer to it. Provisional figures published today show that manufacturing investment increased by about 13 per cent. in real terms in 1984.
    Mr. Willie W. Hamilton: Is not investment in manufacturing industries 30 per cent. less than it was when the last Labour Government left office?
    Mr. Lawson: Investment in manufacturing is, indeed, less—although not by that amount—in real terms since 1979. Total business investment is at an all-time high. That is what the hon. Gentleman should take on board.
    Mr. John Mark Taylor: Will my right hon. Friend remind the House that one of the great modern delusions is that all public capital expenditure is labour intensive? Is that not far from the truth?
    Mr. Lawson: My hon. Friend, who speaks with great experience from a distinguished career in municipal government, is absolutely right.

    Job Creation
    Mr. Maxtonasked the Chancellor of the Exchequer if he has made any estimate of the effect of a £1·5 billion income tax cut on the level of unemployment.
    The Financial Secretary to the Treasury (Mr. John Moore): Income tax cuts will encourage enterprise and effort, facilitate lower wage settlements, and help to provide the conditions for improved economic performance and a sustainable increase in employment.
    Mr. Maxton: Will the Minister please answer the question and give his estimate of the number of people who will be taken off the unemployment queues as a result of tax cuts? Does he agree that talk about incentives when 4 million people are unemployed is an insult to the unemployed, since they want work but it is not available? They are not shy of work. Would it not be better to put the money back into public capital expenditure instead of giving it away to the rich?
    Mr. Moore: The weakness in our economy is not a lack of demand or a lack of public expenditure. Our weakness relates to our inability to compete effectively with foreigners in domestic and international markets. Tax cuts will help not only to stimulate enterprise and effort but to encourage lower wage settlements and to make our economy more competitive.
    Mr. McCrindle: If a substantial part of the £1·5 billion were used to reduce the cost of employment by reducing further employers' national insurance payments, is it not arguable that that would have a better effect on unemployment than capital investment or reduction of personal taxation?
    Mr. Moore: My hon. Friend has argued that point before, and my right hon. Friend the Chancellor will have heard his question. I am sure that my hon. Friend is pleased that, in the past five or six years, employer costs as a percentage of total taxation have decreased from 14 plus per cent. to 9 per cent. That shows the Government's recognition of the burden.
    Dr. Bray: Although Treasury Ministers are quite mistaken in thinking that income tax cuts are the most effective means of stimulating employment, does the Financial Secretary, within his own terms of reference, agree with the Institute of Fiscal Studies that the worst way to improve incentives is to raise thresholds?
    Mr. Moore: No, I do not agree with that suggestion. It has an attractive simplicity and I understand some of the
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    points that the institute makes. Bearing in mind our exceptionally low thresholds, I thought that it was common ground that they always merit attention. I shall draw what the hon. Gentleman said to the attention of my right hon. Friend, who was listening carefully.
    Mr. John Townend: Does my hon. Friend agree that but for the miners' strike we would be looking forward to much larger tax deductions in the Budget and therefore a much greater effect on employment? Will my hon. Friend remind taxpayers that if the Labour party had not given Arthur Scargill such solid support they would have more money in their pockets?
    Mr. Moore: My hon. Friend is right to the extent that our gross domestic product grew by 2·5 per cent. last year —something more than 1 per cent. less than it might have grown. The strike has clearly had a significant impact on my right hon. Friend's ability to carry forward our policies. I hope that all hon. Members want there to be an end to this unnecessary dispute.
    Mr. Terry Davis: How many jobs will arise from using £1·5 billion to cut taxes? Does the Minister not know, or is he refusing to tell us?
    Mr. Moore: The simplicity that is evident in the hon. Gentleman's question sometimes makes me despair. To the extent to which the economy suffers from supply side difficulties, as opposed to demand difficulties, any attempt to reduce the taxation burden will increase job opportunities. Simple analysis of mathematical models fails to understand how supply side effects are improved by competition through tax cuts. Failure to understand that is at the base of the Opposition's inability to understand the Government's economic policies.

    Public Expenditure
    Mr. Duffyasked the Chancellor of the Exchequer if he has made any revisions to the estimates for the overshoot of public spending above targets contained in the recent public expenditure White Paper.
    Mr. Peter Rees: An updated estimate of the public expenditure planning total outturn for 1984–85 will be published in the "Financial Statement and Budget Report".
    Mr. Duffy: At least the right hon. and learned Gentleman has not made his perennial boast about holding spending in real terms. Presumably he now knows that hardly anyone believes him. Moreover, he continues to threaten us with cuts in spending programmes which might have boosted wealth to fund a social security bill which is the direct result of the Government's failure to generate jobs. Contrary to what the Financial Secretary has just said, does the right hon. and learned Gentleman agree that we want, not clamps on labour costs and price tags on public assets, but a sharp increase in spending power, which will increase wealth and jobs?
    Mr. Rees: I remind the hon. Gentleman that the hon. Member for Tynebridge (Mr. Cowans) suggested that increased spending would suck in imports. Sustainable jobs will be created by the policy being pursued by the Government, not by a meretricious increase in spending on uncosted capital projects.
    Mr. Stern: In the light of recent debates on water charges and local authority housing expenditure, does my

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    right hon. and learned Friend agree that those who call most stridently for increased public spending are often those who are most reluctant to find means to pay for it?
    Mr. Rees: My hon. Friend is absolutely right. That was evident in some of our debates—for example, on the increase in water charges, which will open the way to increased capital investment by the water authorities of nearly £1 billion next year.
    Mr. Robert Sheldon: Will the Chief Secretary to the Treasury explain to us how he expects the external financing of the nationalised industries to be reduced by £3 billion over the next three years? When the Government last expressed optimism in 1980 they expected it to be reduced by £2 billion, but it never was. Why is the Chief Secretary more optimistic now than he was then?
    Mr. Rees: It seems to have escaped the attention of the right hon. Gentleman that we have moved rather sharply out of the recession. It will also have escaped his attention that the nationalised industries are getting a rather firmer control over costs than they had before 1979.
    Mr. Hickmet: May I ask my right hon. and learned Friend what he believes are the prospects for public expenditure overshoots on local authority expenditure and what effect he believes the present levels of local authority spending have upon job prospects and the economy as a whole?
    Mr. Peter Rees: We believe that firm control of public expenditure is an important element in the Government's strategy and that that is the way to create sustainable long-term jobs. On my hon. Friend's precise question about local authority current spending, the Government have improved the control mechanisms. I have no doubt that my hon. Friend is a firm supporter of rate capping. Rate capping will operate on the 18 authorities which account for about 70 per cent. of the local authority overspend.

    Economic Growth
    Mr. Andrew F. Bennettasked the Chancellor of the Exchequer if he is satisfied with the growth rate of the economy in the last 12 months.
    Mr. Moore: By the middle of this year our economy will have achieved four consecutive years of growth. The duration of the recovery will then be longer than any since 1945.
    Mr. Bennett: Will the Minister explain to my constitutents why he is so pleased with those figures? If the pound has responded by going down, thus forcing inflation to start rising again, it masks a fall in industrial production. What figures does the Minister believe have to be achieved before unemployment starts to fall?
    Mr. Moore: I should have thought that the whole House, whatever its legitimate concern about the long-term problem of tackling unemployment, would welcome the fact that we are in the middle of four years of recovery. As the hon. Gentleman is worried about our manufacturing capability, I hope that he will not only remember the words of my right hon. Friend the Chancellor of the Exchequer a few moments ago about manufacturing investment being up by 13 per cent. in 1984, but that he will be interested in the fact that in 1984 manufacturing export volume was up by 11 per cent.—another piece of what I hope the hon. Gentleman thinks is good news.
    Mr. Yeo: Has my hon. Friend noticed that the level of real interest rates is higher now than it has been, on average, for some time? Does he agree, therefore, that one of the most desirable forms of stimulus to the British economy would be a Budget which enabled real interest rates to be significantly reduced in the coming months?
    Mr. Moore: The rate of real interest rates reflects one of the features of the last five years—the reduction of inflation. Obviously I shall draw the attention of my right hon. Friend to the budgetary recommendations of my hon. Friend, but what most industrialists and business men want, and what would add most to long-term employment, is a further reduction of inflation and the opportunity in wage settlements for our country to be competitive in terms of international wage unit costs.
    Mr. A. Cecil Walker: Does the Chancellor realise that the imposition of further taxation on the tobacco industry will seriously affect jobs in that long suffering sector and the economy of the country as a whole?
    Mr. Moore: I commend the hon. Gentleman on the way in which he has been able to make a budgetary representation to my right hon. Friend the Chancellor of the Exchequer by means of that question.
    Sir William Clark: Does my hon. Friend agree that one action that the Government could take to relieve unemployment would be the complete abolition of wages councils?
    Mr. Moore: I am not quite sure how that fits as a budgetary representation, but I shall certainly draw the attention of my right hon. and hon. Friends to that recommendation.
    Mr. Campbell-Savours: How are discussions developing on the package of incentives for small businesses and the community programme that was commented upon a few weeks ago in the leader columns of the Sunday newspapers? Is it true that the Chancellor is under pressure from his own Back Benchers to introduce such a package, and will he make sure that if it is introduced it includes a substantial increase in the number of places made available under the community programme, because that would create real employment in areas such as mine?
    Mr. Moore: I could not begin to comment on newspaper speculation, but I draw the hon. Member's attention to the major achievements in the small business sector over past years, especially the radical reduction in the corporation tax rate to 30 per cent.—a record low in the whole of the Western world.
    Mr. Thurnham: Does my hon. Friend agree that the cost of financing the miners' strike is a burden on the money markets, and that capital investment is not helped if there is a Scargill surcharge on mortgage payments?
    Mr. Moore: There is no way in which industrial disputes of the kind that we are going through at the moment can in any way help our country's economic development. I am sure that all those who wish to see a reduction in unemployment, and a return to the kind of growth pattern that might have developed last year without the strike, would wish to see this unnecessary dispute ended.
    Mr. Wainwright: To remove one of the obstacles to economic growth and to assist business confidence, will

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    the Government take advantage of the present favourable opportunity to open negotiations with a view to Britain joining the exchange rate mechanisms of the European monetary system?
    Mr. Moore: I shall draw my right hon. Friend's attention to that point. I think that the Chancellor of the Exchequer made the Government's position on that issue clear last Question Time, and that position has not changed since.
    Mr. Soames: Does my hon. Friend agree that one of the factors restraining the economy is that the state is still far too much engaged in industry? Will he accordingly introduce plans to denationalise the gas, water and electricity industries, in order to release a large amount of money into the economy?
    Mr. Moore: I have a distinct feeling that my hon. Friend's suggestion is somewhat wide of the question, but he is absolutely right in recognising the Government's privatisation programme as a key element in revitalising the economy.
    Mr. Blair: Is not industry now paying about £1,000 million per year more for the cost of borrowing because of high interest rates? Are not real interest rates now the highest that they have ever been, under a Government who said that they should be judged by their achievement of low real interest rates? When will the Minister tell the House that those real interest rates will come down?
    Mr. Moore: As I said earlier, in the last five years industry has seen a reduction in the burden of taxation relative to total taxation, from 14 per cent. of all taxes to 9 per cent. now. That is a significant achievement, which helps industry. I am sure that the hon. Member will help in further assisting industry by ensuring that pay settlements reflect productivity increases, instead of having the kind of pattern that has made our wage unit costs so unattractive in competitive terms.

    Manufacturing Output
    Mr. Hunterasked the Chancellor of the Exchequer what are the latest statistics for United Kingdom manufacturing output; and if he will make a statement.
    Mr. Lawson: Manufacturing output is estimated to have risen by some 3½ per cent. in 1984. This is the largest percentage increase in any year since 1973.
    Mr. Hunter: I duly acknowledge and warmly welcome my right hon. Friend's answer, but, bearing in mind that opponents of the Government sometimes try to argue that such an increase from a relatively low baseline is fairly easily achieved, will he comment on any underlying trends or indications which suggest that that growth is sustainable?
    Mr. Lawson: The growth is certainly sustainable; indeed, I am confident that it will be sustained, provided that the Government stick firmly, as they will, to the medium-term financial strategy.
    Mr. Canavan: Why is our trade in manufactured goods now in deficit for the first time since the Industrial Revolution?
    Mr. Lawson: I should have thought that the hon. Member, coming from a constituency in Scotland, would
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    at least have heard of North sea oil and would realise that if there is to be a large surplus—as there is—on our oil account in the balance of payments, there is bound to be a corresponding deficit in regard to trade in manufactured goods.

    Value Added Tax
    Mr. Hannamasked the Chancellor of the Exchequer what representations he has recently received from disability organisations on the imposition of value added tax on building alterations.
    The Minister of State, Treasury (Mr. Barney Hayhoe): Over 100 from disabled individuals and their organisations.
    Mr. Hannam: Is my hon. Friend aware that last year's extension of VAT to house adaptations has added a vast amount to the VAT bills faced by charities? Is he also aware that the system of relief for adaptations for the disabled is causing great confusion and anomalies? Will he remove them by extending relief to all household adaptations for the disabled?
    Mr. Hayhoe: I have noted what my hon. Friend has said. He will recognise that last year special reliefs were given and at that time I said that the main objection to the proposal he has now made was revenue costs. The facts remain the same this year as last year.
    Mr. Alfred Morris: Is the Minister aware that after the last budget the Jewish Blind Society had an extra VAT bill of £100,000, the Spastics Society one of £120,000 and the Royal National Institute for the Blind one of £100,000? The result was that their work in the service of severely disabled people was adversely affected. Is this not an intolerable way to treat the voluntary sector?
    Mr. Hayhoe: I met the representatives of the Charities VAT Reform Group and points along the lines of those mentioned by the right hon. Gentleman were made at that meeting. One has to see this in the broader context of the very significant concessions within the tax system made available to charities and the very substantial grants that are made by the Government to charities.
    Mr. Alan Howarth: Does my hon. Friend recognise that many charities undertake responsibilities which would otherwise be a direct and full charge upon the public purse? Will he therefore reconsider his policy with a view to putting in place a tax regime for charities that is coherent and systematically supportive of charities?
    Mr. Hayhoe: The points made by my hon. Friend are those contained in the representations that the Chancellor has received from the Charities VAT Reform Group and, as has been indicated to that group, they will be given careful consideration.
    Mr. Carter-Jones: Does the Minister agree that VAT on a vital alteration in a building for disabled people represents a tax on disability?
    Mr. Hayhoe: No, I do not think that I would accept that proposition.
    Mr. Yeo: Does my hon. Friend agree that the continued imposition of VAT on charities runs directly counter to the other helpful measures which the Government have tried to introduce in support of their wish for a partnership with the voluntary sector?
    Mr. Hayhoe: I do not think that there is any question of trying to introduce—very substantial concessions and advantages have been introduced by this Government.
    Mr. Ashley: Does the Minister recognise that the Treasury has been less than charitable to charitable organisations which are trying to carry out these adaptations for disable people? Why is he quibbling over a very tiny cost that could help many people in great hardship, especially when we know that the Chancellor is accumulating £1·5 million to give away in tax cuts?
    Mr. Hayhoe: I do not think that "quibbling" is the right judgment to apply to the debates we had last year on that matter, and I was referring back to them. With regard to this year, it would, of course, be quite improper for me to seek to anticipate my right hon. Friend's Budget statement. I again assert that the Government have done a great deal to help charities, particularly those dealing with the disabled.
    Mr. Meadowcroft: Will the Minister reflect on the answer that he gave to the hon. Member for Eccles (Mr. Carter-Jones), who is surely right? Many disabled people need building alterations to cope with their disability. This is surely a tax on disability.
    Mr. Hayhoe: When one takes account of the relief that was given in the last Budget in connection with building operations for facilitating access to buildings by the handicapped, and of the special zero rating of the first-time installation of a bathroom, washroom or lavatory for a handicapped person in his own home, one sees that very considerable relief was afforded to the disabled in the last Budget.

    Job Creation
    Mr. James Lamondasked the Chancellor of the Exchequer if he has made any calculation of the impact of the recent public expenditure White Paper on unemployment.
    Mr. Peter Rees: The Government's public expenditure plans are an integral part of their policies to encourage a vigorous and enterprising economy and, thus, the conditions for sustainable growth of jobs.
    Mr. Lamond: Does the Minister realise that he is speaking against a background of growing unemployment, including another 1,000 men placed on the unemployment register in my constituency in Oldham, and that, despite the welter of statistics with which he tries to mislead the country, outside this building there are 4 million people, who are not statistics, who are unemployed, and to whom his boast of an expanding economy rings very hollow indeed?
    Mr. Rees: The hon. Gentleman misunderstands the background against which I gave my answer. There was an increase in jobs of 389,000 between the third quarter of 1983 and the third quarter of 1984.
    Mr. Heddle: Does my right hon. and learned Friend agree that unemployment in the construction industry could be reduced significantly if development land tax was amended significantly? Does he agree also that the cost of collecting this pernicious tax exceeds the net revenue that is enjoyed from it?
    Mr. Rees: My hon. Friend's second proposition is not correct. As for prospects of abolishing or curtailing the tax, my hon. Friend will have to wait for 19 March.
    Mr. Ron Brown: If things are on the up and up, as is alleged, why is it that Rowntree Mackintosh is closing its profitable factory in Edinburgh? Will the right hon. and learned Gentleman answer that question?
    Mr. Rees: No, because I am not answerable for Rowntree Mackintosh.
    Sir Geoffrey Finsberg: Does my right hon. and learned Friend agree that, irrespective of what the White Paper may say, if workers continue to ask for more money than the value of the goods they produce they will put more and more people out of work? Would it be an idea for the teaching profession to learn that as well?
    Mr. Rees: I am sure that the House will accept my hon. Friend's analysis. I hope that the lesson is learnt by the trade union movement.
    Mr. Terry Davis: Will the reduction of £1 billion in spending on construction next year compared with expenditure in the previous year result in more, or fewer, jobs?
    Mr. Rees: The hon. Gentleman, like his hon. Friends, is focusing on the public sector. He should consider housing starts in the private sector.

    North Sea Oil
    Mr. Fisherasked the Chancellor of the Exchequer if he has revised his forecast of the total tax take from North sea oil in the light of exchange rate and oil price movements that have occurred since the Autumn Statement.
    Mr. Moore: The latest forecasts of North sea tax revenues will be published on Budget day.
    Mr. Fisher: Is it not a fact that, since the Autumn Statement, the pound has fallen 12 cents against the dollar? In the light of Treasury Ministers telling the Select Committee that each cent. is worth about £150 million more in oil revenues for Britain, that means that the Chancellor of the Exchequer has about £1·8 billion of manoeuvre for his Budget statement. Will he use that money to create jobs in industry and not waste it as he has wasted it before?
    Mr. Moore: It is important to remind the House of what was said by Treasury Ministers and the chief economic adviser at the meeting to which the hon. Gentleman has referred. When asked about calculations, the chief economic adviser said:
    "to achieve a systematic set of calculations right across the board you have to specify rather precisely quite a lot of assumptions about whether one is speaking of a particular bilateral rate, or whether one is speaking about the effective rate and in turn what effects you think that would have upon world commodity prices, and particularly upon oil prices, the impact upon the inflation rate etc."
    The chief economic adviser was trying to point out the danger of the simplistic trap into which the hon. Gentleman has sought to lead us. He should recognise the other implications for oil price and exchange rate changes.
    Mr. Malone: Does my hon. Friend agree that the tax take from the North sea will be vital in the long term for Britain's economy? Is it not absurd that the Leader of the

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    Opposition has announced that it is his policy to take and retain controls over North sea oil development? This will prejudice development in the North sea and eventually the tax take from it.
    Mr. Moore: My hon. Friend is right. The tax revenue system, as he will know from his Scottish experience, is extremely important. He will know also, from the Autumn Statement, that revenues expected in the current fiscal year amount to £12 billion. It is forecast in the Autumn Statement that revenues in 1985–86 will be a similar £12 billion. North sea oil is an important national asset, and my hon. Friend is right to draw our attention to the fact that it will, we trust, continue to produce good results for the nation for many significant years.

    Value Added Tax
    Mr. Cabornasked the Chancellor of the Exchequer how many representations he has received regarding the imposition of value added tax on newspapers.
    Mr. Hayhoe: Over 2,000 representations about the imposition of VAT on books, newspapers and periodicals.
    Mr. Caborn: Has the Minister considered the Price Waterhouse report, commissioned by the Newspaper Society, which suggests that the imposition of VAT in this area could result in the loss of 7,000 jobs and over 100 titles? Is this part of the budget for jobs?
    Mr. Hayhoe: The Price Waterhouse report referred to by the hon. Gentleman is one of the many representations and pieces of information that have been received and are being considered.
    Mr. Dykes: In view of the representations received, does my hon. Friend agree that to impose VAT on the cover price of local newspapers would be a crippling blow to many of them?
    Mr. Hayhoe: I have met representatives from the Newspaper Society, who have made their case with considerable strength.
    Mr. Barron: With regard to the likelihood of VAT being imposed on newspapers, has the Treasury considered what will happen to local free newspapers which rely solely on revenue from advertising and provide a good service for their communities? Is the hon. Gentleman aware that they will be unable to pass on costs to their customers because they are free sheets? Is he aware that this service may fold up?
    Mr. Hayhoe: As I said, representations have been received across the board. I met representatives of the Association of Free Newspapers, who again have made the case for free newspapers with considerable vigour.

  PRIME MINISTER

    Engagements
    Mr. Nichollsasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): I have been asked to reply.
    My right hon. Friend is paying an official visit to the United States.
    Mr. Nicholls: Will my right hon. Friend take this opportunity to confirm, in regard to limited list prescribing, that it is and always has been the Government's intention that a full and comprehensive list of drugs should be available for all National Health Service patients, irrespective of their ability to pay? Will he, therefore, condemn the disreputable behaviour of a small minority of doctors who have grossly misrepresented the Government's proposals and in so doing have caused their patients, particularly their elderly patients, acute anguish and distress?
    Mr. Biffen: I can confirm that it has always been the intention that the list should be comprehensive and well judged. I agree that there has been a good deal of public misapprehension about what is intended. I very much hope that that problem will be resolved when my right hon. Friend the Secretary of State for Social Services makes a statement later this afternoon.
    Mr. James Hamilton: When the right hon. Lady comes back from America, will the Leader of the House ask her to visit Strathclyde region, where half of the male population who are unemployed and drawing benefit have been unemployed for over a year, where 40 per cent. of them have actually been unemployed for over two years and where 40 per cent. of the women between the ages of 30 and 59 have also been unemployed for over two years? Is it not time that the Prime Minister paid a visit to the region to see at first hand the effects of her economic policy?
    Mr. Biffen: My right hon. Friend is undoubtedly sufficiently seized of the problems of unemployment not to need to visit any particular part of the United Kingdom to realise that it is a substantial and widespread difficulty. In that context, I am sure that the hon. Gentleman will at least take some solace from the latest figures of the Department of Employment, which show that the number employed is rising, and rising quite well.
    Mr. Speaker: Mr. Cockeram.
    Mr. Cockeram: Has my right hon. Friend had time to study the figures—
    Mr. Speaker: Order. Question No. 2.
    Mr. Cockeramasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    Mr. Biffen: I have been asked to reply.
    I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Cockeram: Has my right hon. Friend had time to study the figures to which he referred in his reply to the hon. Member for Motherwell, North (Mr. Hamilton)? Is it not remarkable that the number of people in work has risen by over one third of a million in the last 12 months? Is not this the other side of the coin to the number joining the unemployment register and seeking work, which of course includes married women?
    Mr. Biffen: My hon. Friend is right in the point that he has made. Without doubt, a study of the register demonstrates the importance of the self-employed in our economy and, therefore, of economic policies designed to encourage their interests.
    Ms. Harman: Will the right hon. Gentleman confirm, or deny, that I am being subjected to political snooping by

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    MI5? If I am, will he arrange for me to see a copy of my file? Is it not the case that such snooping is outside the guidelines, since information gathered on me clearly has nothing to do with national security?
    Mr. Biffen: If it is of any interest to the House, I am in absolutely no position to comment upon what may have been the situation of the hon. Lady. She will know that my right hon. and learned Friend the Home Secretary confirmed on 7 February what has been the practice of successive Governments, that it was never the practice in cases of individuals where telephone tapping was alleged either to confirm or deny that interception had taken place.
    Q3. Mr. Wardasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    Mr. Biffen: I have been asked to reply.
    I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Ward: Will my right hon. Friend urge our right hon. and learned Friend the Home Secretary to study carefully the representations made by Poole borough council on Sunday trading? May we have an early assurance that action will be taken to clear up the collection of anomalies that exist at the moment?
    Mr. Biffen: I am sure that the representations of Poole council will be among the many that will be assessed by my right hon. and learned Friend the Home Secretary. Indeed, the House will wish to assess them when it, in turn, debates the Auld report. My hon. Friend will recollect that that matter was considered in private Members' time in the last Parliament, and on that occasion a sharp division of opinion was revealed.
    Mr. Bell: I take on board the earlier responses of the Leader of the House, but can he remind the Prime Minister, on her return from Washington, of her written promise to me to visit Teesside in the lifetime of this Parliament? Will he further remind the Prime Minister that 1,000 jobs were lost in the first 10 days of the year and that there is nothing like personal experience of unemployment to chasten the mind and change the Government's policies?
    Mr. Biffen: I say particularly in the context of the answer that I gave to the hon. Member for Motherwell, North (Mr. Hamilton) that a visit to Teesside, no less than a visit to Scotland, is a pleasurable prospect. I shall draw the attention of my right hon. Friend the Prime Minister to the hon. Gentleman's point. On the wider issue of unemployment, I go back to the answer that I have given hitherto. I believe that it is the Government's policies that will ultimately provide the basis for a recovery in employment, and there is some harbinger of that in the figures for those who are actually in work.
    Sir Fergus Montgomeryasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    Mr. Biffen: I have been asked to reply.
    I refer my hon. Friend to the reply that I gave some moments ago.
    Sir Fergus Montgomery: Is my right hon. Friend aware that there are press reports that the United Kingdom may make a bid to have the 1992 Olympic Games in this country? Is he further aware that there are other places in
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    this country than London? Does he appreciate that somewhere north of Watford is an area known as the north-west, where we have some of the finest sporting facilities in the country? Does my right hon. Friend not think that Manchester would be a splendid venue for the 1992 Olympic Games?
    Mr. Biffen: I take note of what my hon. Friend says, championing the claims of Manchester. The appropriate action would be for the city to make its cause favoured by the British Olympic Association. I suggest that as the course that my hon. Friend should follow. I should also like to make this observation. By the time we come towards the casting of the Olympic Games, I believe that some authorities in England will be happy to declare themselves Olympic-free zones.
    Mr. Dubs: Will the Leader of the House confirm that it is the British Government's policy in no way to support American backing for the Contras against Nicaragua? Will he make sure that that point is made clear by the Prime Minister to President Reagan during her present visit?
    Mr. Biffen: I am sure that the Prime Minister will make the most clear and explicit statements promoting the British national interest in the Caribbean, and that they will not be lost on the American regime.
    Mr. Temple-Morrisasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    Mr. Biffen: I have been asked to reply.
    I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Temple-Morris: Does my right hon. Friend agree that the executive of the National Union of Mineworkers has utterly isolated itself, not only from the Coal Board, but from nearly half — probably more — of its own membership and the leadership of the British trade union movement? Does my right hon. Friend further agree that it is about time that the Labour party condemned the strike and appealed, together with us in the Conservative party, for a return to work as soon as possible?
    Mr. Biffen: The House will be aware that the Secretary of State for Energy will answer a private notice question on that matter in a few moments. I should like to respond to my hon. Friend by saying that I believe that Mr. Scargill has no hope whatsoever of securing victory, but he has a very real prospect of dividing his union.
    Mr. Skinner: Is the Leader of the House aware that another construction can be put on the toings and froings between the TUC, the Government and the Coal Board? Many members of the NUM and others believe that the TUC was hoodwinked by the Prime Minister and that the liaison committee, headed by Norman Willis, came back with a deal that was infinitely worse than the one the week before.
    Mr. Biffen: I cannot join the hon. Gentleman in delivering so magisterial a rebuke to the TUC — one which alleged, above all, that it displayed the cardinal crime of innocence when in the presence of my right hon. Friend the Prime Minister. I do not think that Ray Buckton is hoodwinking material. This instance demonstrates the intransigence of Arthur Scargill and the reason why, from

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    the very outset, it has never been possible to come to a reasonable and working arrangement to terminate the strike.
    Mr. Loydenasked the Prime Minister if she will list her official engagements for Thursday 21 February.
    Mr. Biffen: I have been asked to reply.
    I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Loyden: Will the Leader of the House urge the Prime Minister, when she returns, to clarify the position of members of the Transport and General Workers Union working at the Ministry of Defence who have been dismissed? The reason for dismissal given to Mrs. Balkinson and other women was that their security screening clearance had run out. The decision taken by the contractors might be a reason for the dismissal. The trade union movement has been unable to obtain a clear answer from the Government. May we take it that this is part of the post-Ponting hysteria that prevails at the Ministry of Defence? Will the right hon. Gentleman press for this matter to be cleared up as soon as possible?
    Mr. Biffen: I should like to thank the hon. Gentleman for his courtesy in giving me notice that he would raise this question. I understand that the matter is now before my right hon. Friend the Secretary of State for Defence. I shall certainly ensure that my right hon. Friend the Prime Minister is apprised of the question when she returns from the United States.
    Mr. Dickens: Does my right hon. Friend accept that the greatest scar and scab on this nation is Arthur Scargill? Does my right hon. Friend remember that 10 months ago I advised the house that Scargill was a Marxist surrounded by Communists and supported by the Kremlin? Does my right hon. Friend accept that we know that Scargill is a Marxist surrounded by Communists and that Russian money is coming into his grubby little hands?
    Mr. Biffen: I think that the whole House realises that Mr. Arthur Scargill is possessed of a wide range of formidable qualities, many of which were covered by my hon. Friend's question. What the House is entitled to know, and what doubtless will be revealed when we come to the private notice question, is how many hon. Members remain in the Arthur Scargill fan club.
    Mr. Kinnock: Is the Leader of the House aware that there is wide public concern about Government threats to employees' pension schemes in companies and to the state
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    earnings-related pension scheme? Will the right hon. Gentleman give an undertaking that the Government will not undermine the employees' occupational pension schemes either by changes in taxation or by DHSS proposals for portable pensions? Will the right hon. Gentleman confirm that the specific statement made by the Prime Minister during the general election campaign—that there are no plans to change the earnings-related component of the state pension — still defines the Government's position?
    Mr. Biffen: As the right hon. Gentleman knows, the earnings-related scheme is covered by one of the reviews now being undertaken by my right hon. Friend. The right hon. Gentleman, together with the rest of us, will have to wait to learn the consequences of the review.
    On the taxation of pensions, the right hon. Gentleman knows that he makes comments that invite a judgment upon the Budget. First, he addressed the wrong person; and, secondly, he asked his questions at the wrong time, as they are just ahead of the Budget. He should take a lesson in patience and, in the best Asquithian sense, wait and see.
    Mr. Kinnock: On occupational pensions, I urge the right hon. Gentleman to convey to his right hon. Friend that it is a pension scheme, which in every respect has been worked for and paid for by people in this country, and they must not be let down for any reason, including the taxation convenience of the Government.
    The right hon. Gentleman said that the inquiry would cover the earnings-related scheme, yet his right hon. Friend said that the aim of setting up the inquiry was not to call into question the fundamental pension structure established in the 1970s. Will the right hon. Gentleman assure us that, with or without the inquiry, there will be no disadvantageous changes in the state earnings-related pension scheme?
    Mr. Biffen: No, I must say quite clearly—
    Mr. Campbell-Savours: Why is the Secretary of State for Energy telling the right hon. Gentleman what to say?
    Mr. Biffen: I shall provide National Health spectacles for the hon. Gentleman if he thinks that I am seeking to get a message from my left hand side.
    I shall not stand at this Box and say anything that prejudices either the Budget considerations or the outcome of the pension reviews now being conducted by my right hon. Friend.

Coal Industry Dispute
3.31 pm
Mr. Tony Benn(by private notice)asked the Secretary of State for Energy if he will make a statement on the mining dispute following the decision of the National Union of Mineworkers' executive yesterday.
The Secretary of State for Energy (Mr. Peter Walker): Mr. Norman Willis, on behalf of the TUC, held a series of discussions with the chairman of the National Coal Board. As a result of those discussions, proposals were prepared by the board which expressed the basis upon which an agreement could be reached on the main issues of the dispute. Those proposals took account of the views Mr. Willis had expressed to the board. Over the weekend, the TUC showed that paper to the NUM executive, which asked for amendments to be made.
The National Coal Board confirmed to the TUC that this was its final paper. The TUC then requested a meeting with the Prime Minister. The TUC confirmed to the Prime Minister that the proposals under discussion would, if agreed to, constitute the final agreement on all of the matters with which they dealt, and that they were not a document which would be an agenda or form the basis of any further negotiations on these issues.
The TUC explained to the Prime Minister that it had a number of difficulties with the document, and my right hon. Friend undertook that I would convey its views to the National Coal Board. That was done, and subsequently the seven TUC leaders asked to have further talks with me before they met the National Coal Board. During those talks I clarified the Government's desire to see that the new NACODS procedures were brought into operation as speedily as possible, and that it was the National Coal Board's intention that they would be in place by the time they were needed. I explained that neither the board nor the Government could accept a position where, if the NUM refused to agree to the detail of the independent body, no review procedures would exist because that might have the effect of the NUM being able to frustrate any reasonable plans for closure. The document was therefore amended to express the desire of all parties to see that the new procedures were in operation by 1 June, which would be well in time for any disputed closure to be referred to the independent body.
The document was further reordered to meet the NUM's anxiety that its sequence as originally drafted could have implied that disputed closures would take place prior to going through the proper procedures. A reordering of the document made it perfectly clear that a disputed closure would take place only at the end of the agreed procedures.
I share the TUC's disappointment that the NUM executive has rejected the proposals which had been made. The NUM executive has now rejected proposals in seven rounds of talks, the compromise proposal put forward by ACAS and the proposals prepared following discussions between the TUC and the National Coal Board.
I deplore the fact that the generous and reasonable offers now available to miners continue to be rejected by the NUM executive. Those coalfields which originally balloted voted overwhelmingly against strike action. I can only urge those miners still on strike, though deprived of
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a ballot, to return swiftly to normal working so that the damage being done to their industry, their families and their communities can come to an end.
Mr. Benn: Is the Secretary of State aware that his statement entirely fails to explain how the executive and delegate conference of the NUM unanimously rejected conditions which were much worse than the ones discussed over the weekend? Is he also aware that the leadership of Arthur Scargill, Peter Heathfield and Mick McGahey—the subject of unfavourable comment in the House—has throughout earned the unanimous support of the executive and the delegate conference?
Is the right hon. Gentleman further aware that the NUM executive is, and remains, ready to meet for discussions without preconditions, but that after the enormous sacrifices made by the miners, two thirds of whom are still on strike—87 per cent. of those who have ever been on strike are still on strike—it is not prepared to accept the 13 per cent. cut in its industry which Mr. Michael Eaton announced on television? Is he also aware that the public is beginning to understand that the Government planned, financed and sustained the strike, and now want it to continue, and that that, among many other reasons, is why there is a substantial fall in the Government's popularity as well as in the value of the pound?
Mr. Walker: The right hon. Gentleman's opening remarks are a gross insult to seven leading trade union leaders. For the executive of the NUM to say that not just Mr. Norman Willis, but people like Moss Evans, David Basnett, Ray Buckton and Bill Keys went back with a document which was worse than the one they took last Sunday is a total criticism of those trade union leaders. No one could look at those documents and say that this was a much worse proposal.
As to the support for the three NUM leaders mentioned by the right hon. Gentleman, they are the only NUM leaders in history who have divided their union from top to bottom.
Mr. Andy Stewart: It is a personal disappointment that the talks have broken down, and my right hon. Friend has told us why. However, those miners who have been working since the strike began are becoming highly agitated by the fact that their outstanding pay award has not been implemented. Has my right hon. Friend any contingency plans for talking to them?
Mr. Walker: This is obviously a matter for the National Coal Board. The figures which the right hon. Member for Chesterfield (Mr. Benn) gave about the number of miners now at work are totally and completely inaccurate. In fact, within the next few days I expect more than half the NUM membership to be at work. The other two unions are at work. Yesterday, Mr. Vincent rushed out of the meeting and gleefully said, "We rejected all the proposals". When he said "We", he forgot that in his own area 83 per cent. of NUM members are at work.
Mr. Stanley Orme: Will the Secretary of State confirm that substantial concessions have been made by the NUM, including acceptance of the modified colliery review procedure agreed at ACAS between the NCB and NACODS last October? That was reaffirmed this morning. Therefore, the misunderstanding which has arisen over the NCB document — it is not a TUC document—could be resolved by immediate direct talks

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between the full NUM executive and the NCB. Did not the TUC also attempt to facilitate those direct talks? Therefore, instead of insisting that there will be no further talks, will the Secretary of State facilitate such a meeting so that a negotiated settlement can be agreed and this damaging and painful dispute brought to an end?
Mr. Walker: I wish to make it perfectly clear that the Coal Board has said — with the Government's full support—that there will be no further talks on the main issues in the document. The reason why there will be no further talks is that the Trades Union Congress came to the National Coal Board, had a series of talks, returned suggesting further amendments, which were made, sat at No. 10, and all seven TUC leaders confirmed that this agreement would not be subject to further negotiation. The Government and the Coal Board stick to that position.
Mr. Tim Eggar: Does my right hon. Friend agree with the hon. Member for Bolsover (Mr. Skinner) that Mr. Willis was hoodwinked? Does he agree that many thousands of ordinary decent working miners have been hoodwinked by Mr. Scargill and his cronies into supporting what is now exposed as a political, not an industrial, strike? Does he agree that the solution is in their hands, and that they should return to work?
Mr. Walker: We know that the Left wing of Labour party politics is currently conducting a campaign against Mr. Willis. It was not just Mr. Willis but a wide range of trade union leaders, from left and right of the spectrum, who took the decisions. We must be clear that anyone who makes accusations about hoodwinking makes them against seven of the top trade union leaders in the United Kingdom.
On the question of who has been led astray, I remind the House that for the first time in living memory miners were deprived of a ballot. They were then subject to mob picketing, never previously witnessed in this country. The tragedy is that, although the best offer has been made since nationalisation, miners' families and mining communities have suffered more than at any time since the war.
Dr. David Owen: Does the Secretary of State agree that the policy of continuous negotiation and of dribbling out concessions has probably extended the strike? Does he agree that there is a strong likelihood that the strike will come to an end more quickly if there is a clear pause in negotiations?
Mr. Walker: At the time of the ACAS compromise proposal it was perfectly reasonable for the Coal Board to say that there was no point in having further talks with Mr. Scargill. The board said that until Mr. Scargill confirmed that he was willing to accept the reality that uneconomic pits must face the prospect of closure there was no point in having further negotiations. Recently, at the request of the TUC, further negotiations have taken place. Mr. Scargill slapped the TUC in the face in the same way that he slapped ACAS in the face. As far as I am concerned, talks about the issues dealt with in the document have come to an end.
Mr. David Madel: Will my right hon. Friend confirm that there has been a genuine and sustained effort by Mr. Willis and the TUC to help to solve the dispute, and that once again Mr. Scargill and his
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supporters are out of line with TUC thinking and the way in which industrial relations in the coal industry should be conducted?
Mr. Walker: The seven trade union leaders in the TUC group made a detailed examination. Anyone who objectively studies the documents now available will recognise that it is lunacy not to obtain a settlement based on them.
Mr. Martin Redmond: Will the Secretary of State explain to the House the role of Michael Eaton in the dispute, who last weekend made statements about negotiations that were taking place in London when he was in Yorkshire? Will the right hon. Gentleman further explain why he has not used his office to bring both sides of the dispute to the table and to chair a meeting so that sensible face-to-face negotiations may take place instead of little lads scurrying to and fro with letters? Will the right hon. Gentleman now come to his senses and allow negotiations to take place?
Mr. Walker: I can only say that talks have taken place across the table between the two parties on seven occasions and after every.meeting Mr. Scargill's boast has been that he has not moved an inch. I am not sure which "little lads" the hon. Gentleman is referring to, but if he is referring to the seven trade union leaders who have done their best during this past week, I find that a rather strange comment.
Mr. Francis Maude: As the NUM executive has made it quite plain that it is not prepared to make any concessions whatever, will my right hon. Friend make it clear that there is now no basis on which talks can proceed, and that the only hope of ending the strike lies in a continued return to work?
Mr. Walker: With regard to the crux issues which are dealt with in the document, the NCB has made its final position clear. That has been rejected by the NUM executive. Until the executive accepts those proposals, I fear that the strike must go on. But it is in the interests of the industry that every striking miner should recognise that he will serve his industry best by returning immediately to work.
Mr. Allen McKay: Is the Secretary of State aware that Geoff Kirk, who had been at the NCB since 1947 and who had advised every chairman, and Ned Smith, the chief negotiator, who had been at the NCB since 1947 and who had advised every chairman, have left the board? Is it not a fact that they said that they could no longer stomach what the board, Ian MacGregor and the Government were doing to the miners and the mining industry?
Mr. Walker: What the board was offering in terms of pay, investment, early retirement programmes and businesses for mining communities was better than anything offered by any previous National Coal Board or under any Labour Government.
Mr. Andrew Rowe: How many more coal faces can the NCB afford to lose as a result of the strike before it is forced, even against its wishes, to withdraw the offer now on the table?
Mr. Walker: The situation is already serious in that 38 working faces have been lost during the dispute. Thus there has been a serious deterioration in the industry's capacity. Unfortunately, many of those faces were in pits

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that had a good future. Miners must recognise that if the strike continues for much longer considerable damage will be done to their prospects.
Mr. Dave Nellist: Does the Secretary of State realise that the 130,000 miners who are still on strike will take great comfort from the fact that the decision of the NUM executive to reject the document was unanimous? While he is checking his figures, will he bear in mind that 70 per cent. of the Scottish miners are on strike, 90 per cent. of the Yorkshire miners are on strike and that 98 per cent. of the South Wales miners are on strike? Despite the documents that the right hon. Gentleman has referred to, this strike will not be over until every one of the 600 miners sacked during the dispute is reinstated and walks back through the pit gates with their colleagues.
Mr. Walker: Given the hon. Gentleman's interest in statistics, I am sure that he would like to know first that 78 per cent. of the miners in the colliery in his constituency are working. I only hope that he goes and listens to them. His figures are totally wrong. The hon. Gentleman is just clinging to the hope that the militant Left who organised this strike has some possibility of surviving. I am glad to say that it has lost this strike. It has done great damage to the Labour party and is now damaging the TUC; but, above all, it has damaged the miners.
Mr. Neil Hamilton: Is it not clear that from the start of the dispute Scargill has been much more interested in play acting the British Lenin than in ensuring the well-being of NUM members? Is it not now time to stop just urging those on strike to go back to work? Should we not lay it on the line and say that if the strike continues for much longer we shall not be able to continue with the generous offers that are on the table and that mines will have to start to close?
Mr. Walker: I am certain that miners recognise fully the damage that is being done to machinery, to coal faces and to the prospects for their local communities. I believe that many miners have remained out for a range of reasons, including a strong loyalty to the union. I hope that they now recognise, particularly after the events of this week, that loyalty should not apply only to the present leadership of their union.
Mr. Willie W. Hamilton: Is the Secretary of State aware that many Members on the Opposition Benches make a sharp distinction between the mass of the miners and the leadership of the NUM? Nevertheless, will the right hon. Gentleman understand that the mass of moderate miners throughout the country are deeply disturbed by the statement of the Chancellor of the Exchequer that £4·5 billion, which the strike has cost, is a very good investment from the Government's view? The Prime Minister has talked about "the enemy within"—meaning the miners—[HON. MEMBERS: "No."] The Minister had better understand that moderate miners believe that. They are frightened by statements of very senior Ministers. Will the right hon. Gentleman, who is much more moderate in these matters than his leader, go back to Mr. Willis and see whether he and Mr. Willis can have one more try to solve this serious and damaging dispute in which there can be no winners?
Mr. Walker: In the speech by the Prime Minister to which the hon. Gentleman referred she made the same distinction as he makes between the present leaderhip of the NUM and the miners. She made it clear that she thought that the enemy was not ordinary, decent miners, but the manner in which part of the leadership operates.
Whatever the cost of the dispute, it was the Chancellor who agreed to a massive investment programme for the years to come in the industry, for hundreds of millions of pounds to pay for generous early retirement provisions and for millions of pounds to be spent on a new enterprise company to bring new jobs to mining communities. When one examines the reality of the Government's performance, there can be no doubt that they have made the most generous offers to the miners since nationalisation. Mr. Willis has shown great patience and was willing to work hard with his colleagues. I am afraid that it was not Mr. Willis who brought the talks to an end, but the NUM executive.
Mr. Roger King: Bearing in mind that Mr. Buckton was one of the magnificent seven of the TUC, is it not time that he went back to his railwaymen and started the coal trains moving again?
Mr. Walker: There is not much need; they are all moving.
Mr. John Ryman: Is it not extraordinary that throughout the dispute the Secretary of State and the Prime Minister have repeatedly shirked their responsibilities on the pretext that the dispute is between management and trade unions and that they have refused to intervene since the strike started? Will the right hon. Gentleman now say whether he is prepared to intervene and to use his good will to initiate further negotiations between the unions and the NCB?
Mr. Walker: No, Sir.
Mr. John Mark Taylor: Does my right hon. Friend accept that the jobs of other industrial workers, such as machine tool workers in the west midlands, are far from safe and that they would give their right arms for such an offer?
Mr. Walker: Yes. One of the things upon which I reflected as I spoke for several hours to the seven trade union leaders in my office was that none of them had had an offer for their union like that made to the miners.
Mr. Peter Pike: Does the Secretary of State recognise that, whether he likes it or not, in a democracy miners have the right to withdraw their labour and to go back when they have a settlement? The right hon. Gentleman believes that the offer is generous, but obviously the miners do not accept the terms. Does he accept that the country needs the coal and to have the miners back at work? There might have been several discussions to date, but no direct discussions have taken place with the third party involved—the Government, who have the power and the responsibility and could, with a positive attitude to the dispute, resolve it. Why do not the Government call the two sides together and resolve the dispute?
Mr. Walker: The two sides have met seven times. On one, they both went to ACAS, which is generally accepted as a genuine machinery for arbitration. ACAS made a compromise proposal which the NCB accepted and the

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NUM rejected. More recently, to the knowledge of the NUM, with the NUM discussing amendments to the document, the TUC has attempted to bring about a solution but has been rejected. The only conclusion that the House should come to is that we are dealing with an NUM leadership which has not been interested in a reasonable and sensible settlement. Our view is now shared by 47 per cent. of NUM members who are at work, and I believe that it will be accepted by many more.
Mr. Gerald Howarth: Is my right hon. Friend aware that 83 per cent. of miners in my constituency are at work and that the pit at which they work is working near normally and is in profit? Is he also aware that they strongly welcome the efforts that the Government have made in an attempt to bring about an honourable settlement? Does he agree that it is only justice to those men who are working that those who persist in refusing to work must be served notice to quit as they clearly do not want jobs?
Mr. Walker: No, Sir; I do not believe that it would be in any way justified to give notices to quit. When miners consider the basis of what is on offer, its fairness and how the TUC has tried to intervene to their benefit, I believe that they will return to work. I shall have no part in saying that, at any given moment, miners, who might have been kept out by all sorts of intimidation, should be dismissed because they have stayed out. As for the numbers who have returned to work, I am pleased to hear the figures for my hon. Friend's constituency, but in north Nottinghamshire, 95 per cent. are back at work, in the south midlands, 80 per cent. are back. In the western area, 82 per cent. are back and in north Derbyshire, 76 per cent. are back. The pattern is being copied all over the country.
Mr. Kevin Barron: Will the Secretary of State stop attempting to mislead the House and make a proper statement about the document that was rejected by the NUM conference today, as it is not that the TUC recommended acceptance of it at the weekend? The document is nothing more than the NCB's and the Government's bottom line, and they want preconditions. The Secretary of State should be a bit more honest and state the facts. He is saying that there are no more negotiations and accepting preconditions, which many trade union leaders have said that it is nonsense for anyone ever to accept.
Mr. Walker: I repeat that seven trade union leaders said categorically at 10 Downing street that the document would be an agreement, not a point on an agenda or for further discussions. If the hon. Gentleman is accusing anyone of deception, he is accusing seven distinguished trade union leaders.
Mr. Rob Hayward: My right hon. Friend has identified the position as adopted by the leaders of the TUC, the position as adopted by the NCB and the position as adopted by the Government. Has he at any stage during the past 24 hours received a declaration of the position as adopted by the leadership of the Opposition?
Mr. Walker: No, Sir.
Mr. Dick Douglas: Will the Secretary of State spend a little time reflecting on what he has said? Is he saying that his prescription is to sit in the trenches and wait until the men go back to work and, in effect, declare their disloyalty to their union, thus breaking
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it? Is that what he wants? Ninety-nine per cent. of my miners are still out on strike and will not break their loyalty, not to Mr. Scargill, not to a personality, but to their trade union. The right hon. Gentleman ought to reflect upon what he said and call together the two parties directly involved and live up to his office as Secretary of State.
Mr. Walker: The hon. Gentleman ought to reflect upon what he has said—that because the miners in his constituency have a great loyalty not to Mr. Scargill but to their union they will not break that loyalty. However, the miners are also saying that until Mr. Scargill, as the leader of the union, is satisfied that his demands will be met they will stay on strike. There is no way in which Mr. Scargill's absurd and extreme demands will be met.
Mr. Michael Meadowcroft: Does not the Secretary of State owe it to the House to tell it what is in his mind about his future actions, which may or may not harm relationships in the mining communities? The Secretary of State said on the radio this morning that if 51 per cent. of the miners go back to work that will not be a magic number. Can he tell us what is the magic number which would trigger off action by the Secretary of State?
Mr. Walker: I believe that it is very important for the whole House to encourage miners to return to normal working as quickly as possible. I am sure that the board would be willing and eager to put into operation the very generous offers that it has made to the miners. I hope that the NUM executive will reflect upon that fact and will quickly accept the very good offers that are available.
Mr. Peter Bruinvels: Does my right hon. Friend agree with me that the refusal by Arthur Scargill and the National Union of Mineworkers to accept the proposals of the Trades Union Congress come as no surprise whatsoever, in view of the fact that Arthur Scargill set out not to preserve and save the remaining pits that are still in operation but to attempt to bring down the Government?
Mr. Walker: While I cannot speak for the motives of Mr. Scargill, I can say that his actions have done great damage to miners, mining families and mining communities.
Mr. Dennis Skinner: Is the Secretary of State aware that the reason why some of us believe that the TUC delegation was hoodwinked was that when the matter was put to the national executive committee every member, including the miners' leaders in those areas that have been working since the strike began, voted to reject the deal? Every one of them said that the deal was worse than the deal of the previous week.
Will the Secretary of State also bear in mind that, although he seems to be cock-a-hoop about miners returning to work, he ought to look at the area that I represent where miners have returned to work? The fact is that 30 per cent. of the miners are still on strike and coal is costing as much as £200 a tonne to mine. The Government and the National Coal Board have to pay the wages not only of the managers and deputies but of the working miners. Instead of coal being mined at the average cost of £38 per tonne which obtained before the strike, even in those areas where only 30 per cent. of the miners came out on strike it is costing five times as much to mine coal.

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The Secretary of State ought to be ashamed of himself. He is forcing the taxpayer to foot this bill for the rest of the strike.
Mr. Walker: As the hon. Gentleman mentioned it, I shall give the figure for his constituency. The fact is that 90·7 per cent. of the miners there are at work. I accept that that is not true of the whole of north Derbyshire because the hon. Gentleman does not have the same influence over the rest of the area.
On the cost of coal, I can only say that the result of this strike, called without a ballot, is that markets have been lost instead of markets having been gained. If during the past year we had put into the industry the capital investment that was available, we should be gaining new markets and producing cheaper coal in the interests of miners.

Business of the House
4.4 pm
Mr. Neil Kinnock: May I ask the Leader of the House if he will state the business of next week?
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir. The business for next week will be as follows:
MONDAY 25 FEBRUARY—Motion on the Rate Limitation (Prescribed Maximum) (Rates) Order.
Motion on the annual report of the European Court of Auditors for 1983.
TUESDAY 26 FEBRUARY — Completion of remaining stages of the Water (Fluoridation) Bill
Motion on the British Shipbuilders Borrowing Powers (Increase of Limit) Order.
WEDNESDAY 27 FEBRUARY — Opposition Day (8th Allotted Day) (First Part). There will be a debate on an Opposition motion on local authority capital expenditure.
Afterwards, completion of remaining stages of the Representation of the People Bill.
THURSDAY 28 FEBRUARY—There will be a debate on Welsh affairs on a motion for the Adjournment of the House.
Second Reading of the Companies Consolidation (Consequential Provisions) Bill [Lords] and proceedings on the Companies Bill [Lords], the Company Securities (Insider Dealings) Bill [Lords] and the Business Names Bill [Lords] which are consolidation measures.
FRIDAY I MARCH—Private Members' motions. MONDAY 4 MARCH—There will be a debate on a motion to take note of the Government's expenditure plans 1985–86, Cmnd. 9428.
The House will wish to know, Mr. Speaker, that it will be proposed that the House should rise for the Easter Adjournment on Thursday 4 April until Monday 15 April.
[Debate on Court of Auditors' Report for 1983 on 25 February 1985
Document
OJ No. C348 Annual Report of the European Court of Auditors for the financial year 1983.
Relevant Report of European Legislation Committee HC 5—ix (1984–85), para. 4.]
Mr. Kinnock: First, may I thank the Leader of the House for giving to the House the dates of the Easter Adjournment? May I also offer him my personal thanks for ensuring that the debate on Welsh affairs is to be taken so near to St. David's Day? Dialch yn fawr. Finally, may I also thank the Leader of the House for agreeing to hold a debate on Monday week on the public expenditure White Paper, a debate for which we have been pressing for some weeks? May I ask the right hon. Gentleman how it can be appropriate to debate the Rate Limitation (Prescribed Maximum) (Rates) Order next week when the matter is still before the courts? If the information upon the rate-capping decision is to be given to one council and is now to be given to the courts, surely that information ought to be given to Parliament before any debate on the order takes place.
May I renew my request to the Government to provide time for an urgent debate on Britain's immigration laws, especially in view of the very disturbing evidence from the Commission for Racial Equality in its report which was published last week? Will the Leader of the House arrange

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for a statement to be made early next week on the very serious allegations that were made against the Home Secretary and the Secretary of State for Defence in the "20:20 Vision" television programme which was withdrawn last night by the Independent Broadcasting Authority? Finally, in view of the statement yesterday by the Prime Minister to the United States Congress in which she expressed her eagerness for British participation in star wars research, will the right hon. Gentleman ensure that a debate takes place as quickly as possible on this issue so that hon. Members can expose the dangers and delusions of such participation?
Mr. Biffen: I thank the Leader of the Opposition for his comments upon the timing of the Welsh debate. I acknowledge his few words in Welsh which, although not comprehended, I am certain were well intended. I, like the right hon. Gentleman, am glad that we shall be able to have a debate upon the Government's public expenditure plans and that it will take place well ahead of the Budget. As for a debate on the Rate Limitation (Prescribed Maximum) (Rates) Order, I think that the matter which the right hon. Gentleman has in mind refers to the precepting capacity of the Greater London council. This was the subject of the previous order, not of the order that will be debated on Monday next. However, I acknowledge that in a sense there is commonality between the two. Perhaps we may consider through the usual channels whether there might be a debate on the immigration regulations. Again I note the right hon. Gentleman's concern about what was highlighted in the "20:20 Vision" television programme. I acknowledge the importance that the right hon. Gentleman attaches to his request for a statement. Perhaps we may also look at that matter through the usual channels. Star wars research will, I think, be a matter of continuing political controversy. I noted what the right hon. Gentleman said as an opening shot.
Sir Anthony Kershaw: Has my right hon. Friend's attention been called to early-day motion 174—
[That this House calls for an increase in the resources devoted to the Overseas Services of the BBC and notes with interest the possibility of an experimental BBC Overseas Television Service.]—
which calls attention to the desirability of increasing the resources made available to the overseas services of the BBC and, by an amendment standing in my name and those of other hon. Members, the resources of the British Council:
[At end add "and also believes that an increase in national resources devoted to the British Council would improve Great Britain's influence and prestige in the world, and be beneficial to the interests of this country."]?
In view of the nearness of the Budget and the finalising of the Estimates, can my right hon. Friend hold out any hope of a debate before the Budget?
Mr. Biffen: I have to say, in all candour, that the chances are slim. Let me try to compensate by saying that I recognise the importance of the topicality of the matter. As my hon. Friend is the Chairman of the Select Committee on Foreign Affairs, that adds even more importance to its consideration.
Mr. John Cartwright: May I reinforce the request for the House to be given an early chance to debate the issues raised by the Channel 4 programme on
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MI5's official secrets, banned by the IBA last night? When former long-service MI5 employees are prepared to state publicly that the secret services have broken their rules by mounting clandestine operations against organisations and individuals who pose no conceivable threat to state security, is that not an issue that this House should have an opportunity to debate at the earliest possible opportunity?
Mr. Biffen: I take note of the hon. Gentleman's question and I am certain that the anxiety that he expresses extends to all parts of the House, but I cannot go beyond the answer that I gave to the Leader of the Opposition.
Mr. Patrick Nicholls: Has my right hon. Friend had a chance to consider the implications of the Unborn Children (Protection) Bill having been given a Second Reading by such a substantial majority? Will he agree with me that, while it was entirely right that the Government should have adopted a neutral attitude to the Bill until the will of the House was made known, now that the will of the House has been made known in such overwhelming terms, it would be appropriate for the Government to ensure that sufficient time is given for that Bill, so that the will of the majority cannot be thwarted by a small minority of people using parliamentary procedures to that end?
Mr. Biffen: My hon. Friend might like to reconsider the proposition that the neutrality of the Government should be balanced by the Government making time available. I do not think that that is how the House would regard neutrality.
Mr. David Winnick: Is the Leader of the House aware that anyone who saw the programme on Channel 4 last night, to which reference has been made, must have considerable concern over the way that MI5 operates, and must ask whether MI5 is now out of ministerial control?
Will the Leader of the House give an assurance that either the Prime Minister or the Home Secretary will make a statement to the House next week? Will the Attorney-General also give an assurance that in no circumstances will the person interviewed in the television programme, a former employee of MI5, be prosecuted under section 2 of the Official Secrets Act?
Mr. Biffen: I gave a measured reply to the Leader of the Opposition and I refer the hon. Gentleman to that. But as the hon. Gentleman raised the wider issue of the Attorney-General giving an assurance, I shall make that point known to my right hon. and learned Friend.
Mr. David Crouch: Notwithstanding what the House might be hearing later this afternoon on the question of the limited list of drugs, may I suggest to my right hon. Friend that it will not be sufficient for this House to consider the matter by the negative resolution procedure? Will he promise us a whole day's debate on the subject in due course?
Mr. Biffen: I note the strength of interest that my hon. Friend has in the matter and I shall bear it in mind, but I would mislead the House if at this stage I held out a likely prospect of a full day's debate.
Mrs. Renée Short: Is the Leader of the House aware of the difficulties that are created for Select Committees when Members who leave

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them are not replaced quickly enough? Is he aware that for some months now the Select Committee on Social Services has been two members short, one from each side of the House? It is a very serious disadvantage to the Committee. The right hon. Gentleman will remember that his hon. Friend the Member for Hastings and Rye (Mr. Warren) raised the same matter last week. When may we expect some action to remedy the inconvenience?
Mr. Biffen: It is a matter of seriousness. Attempts are being made, through our own sort of Westminster ACAS, to see whether the difficulties can be resolved. It requires patience, and I hope that eventually I shall not strain the patience of the House.
Sir Dudley Smith: Will my right hon. Friend reconsider his reply to my hon. Friend the Member for Canterbury (Mr. Crouch)? Is he aware that the limited list of drugs is a matter of intense public interest? While we may not expect a full day's debate, we should at least have half a day — and it should take place in prime time and not in the small hours of the morning.
Mr. Biffen: My hon. Friend makes his case twice as attractive by asking for half as much time, and that must be merely the starting point of the consideration. I have told the House that I recognise that there are strong feelings on the topic, but I have to have regard to all the other competing claims. It is in the context of the House having to vote upon a resolution, and I shall take account of the representations.
Mr. Tony Benn: In view of the statement by the Secretary of State for Energy this afternoon that the Government are not prepared to contemplate any further talks of any sort or kind designed to resolve the mining dispute, is the Leader of the House intending that the matter should be brought back to the House so that Members of Parliament can interrogate the Government about their policy as the strike enters its second year—and particularly as the Government will know, from the tapping of Arthur Scargill's telephone, the wide support that he has among his own members?
Mr. Biffen: I take account of what the right hon. Gentleman says. No time is provided for next week, as he will appreciate. He will also appreciate that the Government do not have the monopoly of opportunity to enable the subject to be debated, but obviously I shall keep the matter under consideration.
Mr. Teddy Taylor: In view of the publication by the Common Market Commission of its reasoned opinion that Britain is breaking Common Market law by not charging VAT on bus and rail fares and on electricity and gas supplies, will the Leader of the House arrange for the Government to make a statement next week on whether they will oppose the measure all the way, when a decision will be arrived at, and what the consequences would be for the Revenue, particularly in view of the horrific impact that the imposition of VAT would have on areas that are dependent on bus and rail travel?
Mr. Biffen: I am sure that there is an innocent and constructive content in my hon. Friend's request. [Interruption.] I have not laughed at all. I think that my
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first task must be to refer my hon. Friend's request to my right hon. Friend the Chancellor of the Exchequer, and we shall see how we can take it from there.
Mr. Michael Meadowcroft: Does the Leader of the House believe that pressure for a debate on the limited prescribing of drugs should come only from Conservative Members? May I, from the Opposition Benches, reinforce the point that there is a serious issue of principle involved in the alteration of doctors' contracts, which is apparently being imposed by order? Would it not be important to debate on the Floor of the House changes in clinical freedom, which may or may not be beneficial?
Mr. Biffen: I think we shall have to see how the resolutions are likely to be drawn in judging how wide a debate can be expected, but I take note of what the hon. Gentleman says.
Mr. Tony Marlow: Rather than having a debate on the report by the Commission for Racial Equality, I wonder whether it would be more appropriate to have a debate on the Commission itself. Although well intentioned, and probably set up in the best circumstances, this body seems to have become somewhat one-sided. That has in part led to the naive report that it has produced which, instead of helping race relations, is rather damaging to them. I am sure also that my right hon. Friend is mindful of the public expenditure connections of the Commission for Racial Equality.
Mr. Biffen: I am surprised that any hon. Member who wanted to debate the Commission should find the fact that a report of the Commission is to be debated in some way an insuperable inhibition. I ask my hon. Friend to live up to his known reputation in these matters, and then there will be no difficulty.
Mr. Andrew Faulds: My understanding is that servants of the House are not permitted to make money out of any memoirs that they might wish to compile. Would it not be to the advantage of Parliament if the relevant body of the House were to examine the need to refrain future Speakers, who are primarily servants of the House, from such ego trips? Might we then not prevent the misrepresentations and the settlement of old scores indulged in by that malicious old maid Tonypandy?
Mr. Speaker: Order. That is a criticism of a Member of the other House. I think that the hon. Gentleman must withdraw those comments. [Interruption.] Order. I must ask the hon. Gentleman to withdraw the adjectives — "malicious" and so on.
Mr. Faulds: I have every wish to comply with your requirements, Mr. Speaker, and I want to stay in the House. I shall, of course, withdraw the word "malicious", relevant as it is in this context. However, I have to maintain that there has been considerable misrepresentation in his stories of what the House—
Mr. Speaker: Order. All I required was that the hon. Gentleman should withdraw those adjectives, and he has done so.
Mr. Richard Holt: Will my right hon. Friend take note that of great public interest is the increase in television licence fees? It is time that there was a debate in the House on the whole question of the funding of the BBC for the public to hear. That is of paramount importance. Time is gradually slipping away, despite the

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fact that we first asked for the debate over three months ago. It is not a suitable subject for an Adjournment debate or private Member's motion on a Friday, but needs to take place during the week.
Mr. Biffen: I take note of my hon. Friend's comments. He is referring to a problem that is commanding growing interest and I shall certainly refer his remarks to my right hon. and learned Friend the Home Secretary.
Mr. Laurie Pavitt: The right hon. Gentleman will recall that I represent a rate-capped authority and therefore he would expect me to try to catch Mr. Speaker's eye next Monday. In the light of his previous answer on this question, is he aware that I usually try to do my homework on these matters and that it is impossible for me, because of the GLC position, to prepare an adequate case on behalf of my borough? Will he therefore reconsider the possibility of having that debate at a time when we can deal with the matter adequately in the best traditions of the House?
Mr. Biffen: I am sorry to hear of the difficulties that the hon. Gentleman has encountered, but I cannot believe that they are insuperable for the preparation of the formidable case which I have no doubt the hon. Gentleman will make on Monday.
Mr. Douglas Hogg: Will my right hon. Friend agree that, although it is possible that the statement shortly to be made on the question of drugs will be entirely acceptable to the House, it is also possible that it will not be? That being so, as the negative resolution obliges us all either to accept or to reject, will he suggest to the Secretary of State that he bring forward draft regulations so that he can consider what the House says before laying final regulations?
Mr. Biffen: My right hon.. Friend is in his place and will have heard that suggestion. No doubt, if my hon. Friend is successful in catching your eye, Mr. Speaker, following the statement by my right hon. Friend, he will be able to repeat that suggestion.
Mr. D. N. Campbell-Savours: May my hon. Friends and I invite the Leader of the House and all hon. Gentlemen on the Government Benches to Committee Room 11 this evening at 7 pm to watch the film by "20:20 Vision", which was banned by the IBA yesterday and which millions of people in the country want to see?
Mr. Biffen: It is always nice to have these chummy invitations across the Floor of the House. I must confess that it is rather short notice, but it is a kind thought and I shall think about it.
Dr. Alan Glyn: In view of the historic importance of my right hon. Friend the Prime Minister's visit to the United States, may we influence the Leader of the House to get her to make a statement next week?
Mr. Biffen: I shall most certainly draw that request to the attention of my right hon. Friend.
Mr. James Lamond: The Leader of the House, in referring to the question about star wars, said that it was a continuing affair. I can certainly testify to the fact that requests for a debate or even a statement about Britain' s position in peace talks is
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a continuing matter, having asked about this for months, if not years, in the past. Since the Prime Minister made it the cornerstone of her speech in trying to ingratiate herself with the American Congress, does that not mean that we should have a debate about star wars and our position in the talks in Stockholm, which have been going on for over a year now without a single word being said about them, either in a statement or in a debate, at the Dispatch Box?
Mr. Biffen: The hon. Gentleman is absolutely right to remind us of his pioneering role in this controversy. I suggest that at least as an opening shot in the next stage he might like to use the advantages that are offered by defence questions next Tuesday.
Mr. Hugh Dykes: Has the Leader of the House seen early-day motion 403?
[That this House calls on Her Majesty's Government to take the necessary steps to become a full member of the European monetary system without further delay.]
In view of the growing number of signatures attached to it and the fact that the Select Committee on EEC Legislation has specifically recommended a debate in the House on the subject, will he now seriously consider having a proper debate, not just after 10 o'clock, on Britian becoming a full member of the European monetary system, bearing in mind the overwhelming virtues and merits of so doing now that the pound sterling has fallen to a level where that policy could be tenable?
Mr. Biffen: The case may have been irrevocably flawed by being endorsed by the CBI, but I leave that to one side. It is a very lively topic which has growing significance as we approach the time of the Budget and I will certainly draw the attention of my right hon. Friend the Chancellor of the Exchequer to that suggestion.
Mr. Richard Caborn: May I draw the attention of the Leader of the House to early-day motion No. 414?
[That this House wishes to register its grave concern at the South African police operation on the morning of 19th February involving the arrest of the leadership of the United Democratic Front; and urges Her Majesty's Government to recall Her Majesty's Ambassador in South Africa for immediate consultations.]
This concerns the arrest of members of the United Democratic Front in South Africa. Is he prepared to get the Government to make a statement? I am led to believe that there has been a delegation this morning to the Ministers at the Foreign Office, who have, to say the least, shown some disquiet about the situation there. It has now been raised at the European level and again disquiet is shown about the problems of South Africa. While it refers to only one incident, the whole question of Crossroads and the other problems in South Africa could well be something of a powder keg. Could I ask, therefore, that the Government make a statement next week similar to the statements that have been made by other member states of the European Community? This is an extremely important point and one that could develop in the next few weeks.
Mr. Biffen: The hon. Gentleman indicates, at least, that concern is felt by the Foreign Office on this matter, and of course I will refer to it his request for a statement.
Mr. Ken Eastham: May I draw to the attention of the Leader of the House the fact that yesterday the Select Committee on Employment

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published a document on the polygraph, which is a lie detector, in which grave reservations were expressed about the use of the instrument? May I remind him that this instrument is at the moment the subject of a pilot test at GCHQ? Considering all the humiliation and aggravation created at GCHQ, will the Leader of the House seriously consider an urgent debate on the report?
Mr. Biffen: I see the force of the argument that reports of the departmental Select Committees should be incorporated in the work of the House as far and as speedily as possible. I cannot think that there is an early prospect of a debate, but I will draw the attention of my right hon. Friend the Secretary of State for Employment to the findings of the Committee.
Mr. Gareth Wardell: On 11 February the House debated regulations concerning hazardous materials. There is a major problem in the implementation of these regulations in that, under the Town and Country Planning Act 1971, it is still possible for warehouses storing non-hazardous materials to be converted without planning consent to store extremely dangerous materials. Since some of these installations are in very densely populated areas and since the Minister of State, Welsh Office has informed me that the Government intend to bring forward proposals to supplement sections 22 and 23 of the Act, will the Leader of the House bring some urgency to the situation so that we may avoid any major problem should a dangerous incident occur in this area?
Mr. Biffen: I will look into that matter and be in touch with the hon. Gentleman.
Mr. Alfred Dubs: The Leader of the House has more than once this afternoon resorted to the usual channels. Will he accept that, worthy as the usual channels may be, they work very slowly? Will he also accept that repetitions of requests for debate are probably the only weapons that we have? I therefore urge upon him the importance of having an early debate on the report by the Commission for Racial Equality, which has caused enormous concern throughout the country. If there is not an early debate, many people will believe that the Government have a great deal to hide.
May I press him further on the need for a debate on the "20:20 Vision" film on MI5's official secrets? The fact that he has not seen it may account for his rather lethargic—or perhaps I should say lackadaisical—attitude to the request for a debate. The film contains the most damaging indictment of what is being done by MI5, and breaches of guidelines and assurances that have been given by successive Ministers. It is not good enough to say that we might have a debate at some time or another. Individuals have been implicated; their telephones are being tapped and they have no chance to answer back, not least my hon. Friend the Member for Peckham (Ms. Harman). If the Leader of the House cannot see the film at 7 o'clock this evening, I can reassure him by saying that I shall put a video copy of the film into the Library so that he may see it at any time.
Mr. Biffen: I note that the hon. Gentleman is not optimistic about the prospects of a debate, otherwise he would not have made his speech now. I sought to reply to
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the Leader of the Opposition on this issue in a way that I hoped would be helpful to the House. I think that it would be more constructive if I left the matter there.
The hon. Gentleman referred to the usual channels. A usual channel that is reinforced by him becomes an even more formidable proposition. I shall see what can be done about a debate on immigration laws.
Mr. Dennis Skinner rose—
Mr. Speaker: Order. The hon. Member for Bolsover (Mr. Skinner) has not been rising in his place previously but I shall call him if he will be brief.
Mr. Skinner: Will the Leader of the House explain by a statement or otherwise next week how the Government come to organise their double standards on the continuation of talks with bodies that include the National Union of Mineworkers? Why is it, for instance, that the Government are prepared to talk and talk with the Common Market about the budget, despite—
Mr. Speaker: Order. The hon. Gentleman should be asking about business next week.
Mr. Skinner: Yes, Mr. Speaker, I am asking about the making of a statement next week.
Why is it that the Government are prepared to continue to talk at length about international debt with bankers from countries throughout the world? Why is it that they are prepared to argue about peace talks—[interruption.] I am asking that there should be a statement about this next week. Why is it that the Government are prepared to send representatives to Geneva to take part in peace talks, even when the Russians walk out and the Americans walk out—
Mr. Nicholas Winterton: Why does not the hon. Member for Bolsover (Mr. Skinner) walk out?
Mr. Skinner: Why are the Government prepared to hammer the miners in the way that they are doing while they are prepared to negotiate with member states in the Common Market and others elsewhere throughout the world?
Mr. Biffen: I think that the hon. Gentleman has had a bad day. He finds that he is light years away from the leadership of the TUC. He is in a bad way because, like many others, he has argued for months that the Government should be seeing the TUC—
Mr. Skinner: Not me.
Mr. Biffen: The Government have now seen the TUC and the Government have shown themselves so good at negotiating with the TUC that—
Mr. Skinner: That is a lie.
Mr. Biffen: —in the hon. Gentleman's words—
Mr. Speaker: Order.
Mr. Skinner: I have never asked that question.
Mr. Speaker: Order. The hon. Member for Bolsover, even from a sedentary position, must not use the word "lie".
Mr. Skinner: Well, I have done and the Leader of the House should withdraw his comment.
Mr. Speaker: Order. I think that the hon. Gentleman has had rather a good week. I believe that the House will agree that yesterday came into that category. I am asking

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him now to withdraw his statement. If the hon. Gentleman is not prepared to withdraw the word "lie", I must ask him to leave the Chamber for the rest of today's sitting.
Mr. Skinner: The right hon. Gentleman said—
Mr. Speaker: I ask the hon. Gentleman to leave the Chamber for the rest of today's sitting.
The hon. Member withdrew accordingly.

Prime Minister's Question Time
4.35 pm
Sir Geoffrey Finsberg: On a point of order, Mr. Speaker. I gave you notice that I wished to raise a point of order arising out of Prime Minister's Question Time today. Prime Minister's questions today, as on virtually every other Tuesday and Thursday afternoon, consist of the first question being repeated ad nauseam. This is a matter that could be examined by the Procedure Committee. When my hon. Friend the Member for Ludlow (Mr. Cockeram) began with a supplementary question on rising to his feet, you, Mr. Speaker, said, "No. Question No. 2." My hon. Friend then had to say, "Question No. 2." My right hon. Friend the Leader of the House had to rise and say, "I refer my hon. Friend to the answer that I gave a short time ago." That was done five times today.
Do you have discretion, Mr. Speaker, to ensure that that procedure is not repeated five times during the course of Prime Minister's questions? If it did not happen, at least two other Members would have a chance of asking a question. If the first seven questions to the Prime Minister are identical and it is decided merely to call those following on supplementary questions, that would be fairer to those who do not presently get a chance.
Mr. Speaker: I do not think that I have that discretion. However, if the hon. Gentleman feels strongly about this he should ask the Procedure Committee to consider it. When the Procedure Committee submits a recommendation, I shall consider it carefully.
Mr. James Lamond: On a further point of order, Mr. Speaker. Although there are dozens of questions on the Order Paper for the Prime Minister to answer that are exactly the same, there is one that is not, which has been tabled by my hon. Friend the Member for Linlithgow (Mr. Dalyell) concerning Conqueror and the General Belgrano.
Mr. Speaker: It happens that today most of the questions to the Prime Minister on the Order Paper are open questions. I share the concern of many who feel that this use of the Order Paper is perhaps not the right way to list these questions. I think that the Procedure Committee should consider the matter before I do anything about it.

Limited List Prescribing
4.36 pm
The Secretary of State for Social Services (Mr. Norman Fowler): With permission, Mr. Speaker, I shall make a statement on the limited list of National Health Service drugs.
I told the House on 8 November that the Government intended to introduce a system under which a selected range of drugs would be available on the National Health Service in seven categories. These were: antacids; laxatives; analgesics for mild to moderate pain; cough and cold remedies; bitters and tonics; vitamins; and tranquillisers and sedatives. I published at that time a provisional list of medicines which might be selected within each category. This was the basis for consultation, which continued until the end of January. We made it clear from the outset that our intention was to produce a list from which doctors would still be able to meet all the clinical needs of their patients.
The chief medical officers of the health Departments wrote to all doctors individually to seek their views on the list. I am grateful to all the many doctors who responded and I hope they will recognise that their views have been taken into account. My chief medical officer also brought together a group of independent experts practising in the relevant medical specialities, including three general practitioners and a pharmacist, to assist him. That group has now unanimously recommended a list of medicines that it believes will meet all clinical needs. I have accepted its advice in full and I am most grateful for its help in this important task.
This extended list of medicines will contain some 100 different medicines, compared with 30 on the provisional list. Most of the medicines will be generic, or unbranded, products; but a number of proprietary medicines will be retained where the group concluded that they were necessary and where no generic preparation currently exists. I should emphasise that the quality of all the selected drugs is assured. They all conform to the very high standards we require of all medicines under the Medicines Act 1971.
For the purposes of the regulations that my right hon. Friend the Secretary of State for Scotland and I will introduce, it is necessary to list all the products that will no longer be prescribable on the National Health Service. The regulations will also cover those products which the advisory committee on borderline substances has advised are not medicines and should not be prescribed by general practicioners. I am today publishing both the selected list of drugs and those no longer to be prescribable. Copies are available in the Vote Office.
I shall also today be giving the representatives of the medical and pharmaceutical professions the opportunity to comment on these regulations as they affect the terms of their contracts with the Health Service.
I shall mention three specific issues concerning the operation of the limited list that have been raised during the period of consultation. The first is the question of the arrangements for reviewing the list itself. This was raised by, among others, the Royal College of Physicians. We fully accept that it is essential for independent professional advice to be available after 1 April on the need for changes to the list. I do not believe that complex machinery is required but I shall be very ready to discuss with the
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professional bodies concerned how the arrangements that have been used to formulate the extended list should be developed for the future.
Secondly, questions have been raised about the implications of the new arrangements for dispensing doctors—that is, doctors, predominantly in rural areas, who themselves dispense drugs to their patients. For these doctors the regulations will in effect retain the status quo. Dispensing doctors will still be able to supply any medicine to those of their patients for whom they already dispense although they will have to issue private prescriptions for medicines that are no longer available on the National Health Service. Concern has also been expressed about the position of retail pharmacists who now hold stocks of drugs that will no longer be available on the National Health Service. I am quite prepared to examine any relevant evidence that pharmacists may present on their stockholding of drugs.
Thirdly, the question has been raised whether there should be some form of appeal mechanism for individual cases in which a doctor believes it is necessary to prescribe on the National Health Service a medicine that will no longer be available. Most concern was expressed by doctors who felt that there were serious omissions in the provisional list. My unanimous medical advice is that the selected list is now comprehensive and will make it unnecessary on clinical grounds for patients to use medicines not on the list. Nevertheless, let me say this: if, after examining the complete list and in the light of experience, the medical representative organisations still wish to propose that such a mechanism should be provided, my right hon. Friend and I will be ready to discuss it with them. I should make it clear, however, that any mechanism would need to be very carefully controlled to ensure that it could be used only in genuinely exceptional circumstances.
During the period of consultation a number of alternative proposals have been advanced. None of these offered the same prospect of achieving sensible savings in the Health Service drugs bill without either harming the interests of patients or threatening the fundamental and legitimate interests of the pharmaceutical industry. The selected list, which I am publishing today, is likely to produce savings in the drugs bill of some £75 million now, rising to a higher figure in due course. It is by making sensible savings of this kind that we are able to provide health authorities with the increased resources which I announced recently. I am therefore convinced that the approach that we have adopted remains the right one in principle. I also believe that the selected list, which I am publishing today, will demonstrate that in practice the Health Service will continue to provide all medicines required to meet the clinical needs of patients.
Mr. Michael Meacher: Is the Secretary of State aware that the fact that his final list is no less than three and a half times as long as his first attempt shows what a hash he made of his original statement? For three months he has unnecessarily caused enormous upset and anxiety because of his total failure to consult doctors and the other professions involved. Since the Government included only 31 drugs in the original list yet have always claimed that the list will meet all clinical needs, what guarantee can there be, since the Government

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got it so wildly wrong the first time, that even this much extended list is completely proof against further error or misjudgment?
Why, after three months, are the arrangements for reviewing the list not yet finally determined? Does it not show continuing divisions in the Government's thinking when the Secretary of State comes to the House today and says that most medicines in his limited list will be generic products yet the Minister of State said in the House only three weeks ago:
"There is no, and never was any, element of generic substitution in the limited list proposals".—[Official Report, 28 January 1985; Vol. 72, c. 59.]
Is the Secretary of State aware that these proposals will still produce a two-tier system, which may well suit Tory interests since privatisation within general practice is more likely if some medicines are obtainable only on a full-cost basis, but will certainly deprive many poorer patients of drugs that they need but cannot afford? Is he also aware that operating a so-called white list of 108 items and a black list of some 1,500 items will produce a bureaucratic nightmare, which will also substantially whittle down any potential net savings?
I have two more technical questions. Why are these provisions being introduced by way of amendments to the terms of service of doctors? On the hospital side, what precise arrangements are being made to override, which is in effect what he is doing, local drug and therapeutic communities where hospital formularies do not coincide with his final list? More fundamentally, his havering on both the review machinery and the appeal mechanism which is needed is not good enough. Will he give an assurance that both will be firmly in place when the scheme starts on 1 April?
On the financial side, since the savings on this list will now fall well short of the £100 million that he promised originally, will he give a commitment, which will be needed if he is to make up the savings total that he spoke of, that the rate of return to the drug manufacturers under the pharmaceutical price regulation scheme will be reduced from the current excessive 21 per cent. at least to the 16·9 per cent. limit that is now accepted as the maximum for risk contractors under Government contract?
If this limited list is so good for Health Service patients, why is the Secretary of State not extending it to private patients?
Mr. Fowler: I think that is one of the silliest responses—
Mr. John Evans: That is not original.
Mr. Fowler: Regrettably, it is not original. That is just the point I was about to make. I have seldom heard such a silly response to a statement.
A few weeks ago the hon. Gentleman was pressing me to consult. I have now consulted and I have brought forward—
Mr. Meacher: Why did the Secretary of State not consult before his earlier list was presented?
Mr. Fowler: The hon. Gentleman knows perfectly well that when I announced the proposal, I did so on the Floor of the House of Commons. That, I would have thought, he would support.
Mr. Meacher: No.
Mr. Fowler: The hon. Gentleman had better make up his mind what the devil he does want, because everyone else is confused.
If I may try to explain to the hon. Gentleman what is happening, we made it clear from the beginning that we would consult on this and that the list was provisional. We have benefited from the advice of about 2,000 general practitioners and also from the advice of the chief medical officer and an independent team. The result is that we have a list of over 100 different medicines compared with the list that we originally proposed. That seems a sensible outcome to the consultation.
To pick up the hon. Gentleman's second major point, it is the unanimous view of the independent committee that the selected list of drugs will meet all clinical requirements. It is for that reason that we set up the independent committee.
In regard to savings, we expect the final list to cut the drugs bill by about £75 million straight away and by more later. I think that the original rough figure was about £100 million. I think that we will come to that in the not too distant future. As for the pharmaceutical price regulation scheme and the negotiations on it, the hon. Gentleman must know—otherwise, he has not been listening to any of the debate on drugs — that those negotiations are taking place at this moment.
As for the hon. Gentleman's last major point on generic substitution, I do not believe in indiscriminate generic substitution. It would not be right to apply that to all categories of medicine. It would undermine the pharmaceutical industry and make research into worth-while and life-saving drugs difficult, if not impossible. I do not believe that is in the interests of the industry, the country, employment or all the things that the pharmaceutical industry has created.
We have consulted on this. We have brought forward an extended list which, I believe, meets all legitimate concerns. I have made it clear that I am prepared to consult further on some crucial issues. At the very least I think the hon. Gentleman's response is entirely churlish.
Several Hon. Members rose—
Mr. Speaker: Order. I understand the concern of the House about this matter, but there is a very important debate on the Royal Air Force in front of us. I shall allow questions on this matter to continue until 5.5 pm, so there will have been a full half hour for the whole statement.
Mr. Michael Meadowcroft: Does the Secretary of State accept that his statement is a considerable improvement on what he said before and that, given that he means what he says about the possibility of an override facility, it should have a fair wind from members of my party? I am glad that the right hon. Gentleman has resolved the problem that he had with his Scottish colleagues over dispensing doctors. However, does he accept that the problem now is that most of the "me too" proprietary drugs, which are the most expensive varieties, are outside the seven categories that the right hon. Gentleman is now listing for us? What proposals does he have to consult on including them in future? Will the right hon. Gentleman confirm that the generics that are on the list, which are available only in proprietary form, are out of licence, so that other people can manufacture them? Otherwise, presumably they are still available only in proprietary form. Can the right hon. Gentleman tell us

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whether the policing—[HON. MEMBERS: "Too long."]—will be costly? Finally, can the right hon. Gentleman tell the House why, in altering the general practitioners' contract, he has not also looked at the pharmacists' contract, because, financially they will be hit seriously by the proposal?
Mr. Fowler: We are in the middle of negotiations with the pharmacists and, as I have already made clear, we shall make the draft regulations available to the medical profession. I am grateful for what the hon. Gentleman said at the beginning of his question because he has recognised—the hon. Member for Oldham, West (Mr. Meacher) singularly failed to do so—the considerable steps that have been taken to meet all legitimate concern on the matter. The review was the basic matter that the hon. Gentleman asked about. It was suggested by the Royal College of Physicians that there should be a review of the list. I am accepting that in principle. I should like to talk to the Royal College of Physicians and the other organisations about that, and I am willing to come to any reasonable arrangement with them. However, one or two of the things that I have announced mean that the BMA and organisations like it now have to be prepared to talk. In the light of what I have announced, it would be quite wrong if they were still to refuse to come round the discussion table.
Mr. Mark Carlisle: Does not my right hon. Friend's statement show that he has consulted and, indeed, taken account of what was said? Does it not show how irresponsible the BMA's attitude has been? Did my right hon. Friend hear the remarks attributed today to Dr. John Marks, the chairman of the BMA, and were they not another example of utter irresponsibility?
Mr. Fowler: I think that Dr. Marks has got it slightly wrong. I do not want to raise the temperature on this matter again, but frankly I think that he got it wrong on the list and he certainly got it wrong with regard to our aims and intentions to extend the list. I say to Dr. Marks and the BMA that we have made it clear by the action we have taken that we are prepared to listen, change the plans and meet all reasonable requests that have been put to us. I very much hope that the BMA will now understand that and come and talk sensibly about the whole thing.
Rev. Martin Smyth: I welcome the statement as it shows some change in pattern. On the other hand, while the Secretary of State said that six independent members advised the chief medical officer, were they like-minded, or were they completely independent in the sense that they had different opinions? Will the right hon. Gentleman specifically tell us whether the Secretary of State for Northern Ireland will issue an identical list and, if so, why he was not mentioned along with the Secretary of State for Scotland in today's statement?
Mr. Fowler: The Secretary of State for Scotland will make his own announcement following this one. There is no question about either the independence or expertise of the advisers. The advice that was given to me was unanimous, and has been accepted entirely and in full by me.
Mrs. Jill Knight: May I assure my right hon. Friend that he has the support of the
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overwhelming majority of his right hon. and hon. Friends for the step that he has taken, as we recognise that money in the Health Service must be spent wisely and without waste, if it is to serve the Health Service? Has my right hon. Friend considered, in the flexible approach that he is taking to the matter, the patient who has a psychological tie to one particular drug? Will that rather special case be considered and weighed up in the procedure that my right hon. Friend described?
Mr. Fowler: I am grateful to my hon. Friend for her support, and I think that she speaks for a great many people. With regard to an appeal mechanism for doctors to deal with the situation that my hon. Friend set out, let me repeat that it was the unanimous view of the committee that the selected list of drugs will meet all clinical requirements. Much of the concern was about possible gaps in the original list. Nevertheless, let me make it clear —this is in direct response to my hon. Friend—that if the profession wished to propose an appeal mechanism that would cover a case similar to the one that my hon. Friend raised, I should be ready to discuss that. It must be carefully controlled and concentrated on the exceptional case. Organisations such as the BMA will have to come to talk about that. I cannot do it by proxy.
Mr. Robert Hughes: Does not the Secretary of State accept that the fact that the new list, which I have not yet seen, is now three and a half time larger than his list, represents a resounding vote of no confidence in his initial judgment? Secondly, I should like to make a specific point about clinical assessment. Is it not the case that some elderly people taking more than one drug rely on colour in choosing the drug to take? Perhaps it is a comparatively minor problem in some areas, but it is extremely important. Will the right hon. Gentleman therefore operate the exceptions system for at least the first 12 months? Will he operate an appeal system to allow doctors greater flexibility during the trial period, with the appeal being made by the health authorities instead of the other way round, because individuals can suffer severely if the appeal procedure is too long?
Mr. Fowler: I cannot do that, but as I have just made clear to my hon. Friend the Member for Birmingham, Edgbaston (Mrs. Knight) I am prepared to talk to the profession on an appeal mechanism. However, I must underline the view that I have from the expert committee, which is that the selected list of drugs will meet all clinical needs. However, I am prepared to try and meet points such as the one that the hon. Gentleman is making, but in the way that I have set out rather than the way that he set out. He referred to consultation. The fact is that if I had come to the House and produced the same list, I would have been accused by the hon. Gentleman and the hon. Member for Oldham, West (Mr. Meacher) of not having had any meaningful consultation. I have gone through consultation. I think that we now have a good list. I hope that that will remove much of the controversy and some of the misrepresentation that have dogged the past few months.
Dr. Brian Mawhinney: Does not the substantial extension of the list that my right hon. Friend has just announced fully vindicate his insistence, sometimes in the face of hostile and organised opposition, that he was willing to listen to the views of doctors and others? Does my right hon. Friend accept that his

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announced willingness to contemplate an appeals procedure will be greatly welcomed both on Conservative Benches and in the country, and further vindicates the Government's reasonable attitude on the issue?
Mr. Fowler: I am grateful to my hon. Friend. I think that the appeals procedure will be welcomed in the medical profession and generally by the public. With regard to consultation, it must be said that, although the BMA has not put detailed points to us, we have had the advice of just under 2,000 general practitioners who have written to us. Therefore, there is no question but that the basis of the advice that we have had has been extensive and sound.
Mr. Jack Ashley: Will the Secretary of State move forward from considering the appeals system to considering brand new drugs? What happens to the brand new drugs that are flooding the market? Who will decide which of those drugs is to be accepted on the NHS list? Will the Secretary of State assure us that the new machinery to evaluate those drugs will be open to public scrutiny so that we know that safety, efficacy and need are the overriding considerations? Cost should not be the overriding consideration. If it were, the right hon. Gentleman would be economising at the expense of the National Health patient.
Mr. Fowler: We are not, in any way, relaxing the licensing system. I entirely accept that any advice upon which we act must be independent and must be seen to be independent. I am certainly prepared to have talks about that type of mechanism. The review mechanism that I want would consider new drugs and whether there was a new suitable generic alternative to replace a branded drug. Obviously, this would occur within the seven categories that I have set out.
Sir Dudley Smith: Is my right hon. Friend aware that, as one who has been connected for nearly 20 years with the pharmaceutical industry, I am deeply apprehensive that these new measures will inevitably lead to further restrictions on prescribing by doctors? Is my right hon. Friend aware that that cannot be in the interests of the pharmaceutical industry, of doctors and, above all, of patients?
Mr. Fowler: The Government support a prosperous pharmaceutical industry. My Department is the sponsoring Department. I understand that the industry does not want a change in those arrangements. Ninety-five per cent. of drugs on the NHS list that will not now be prescribed do not require a prescription in any event. When my hon. Friend has the opportunity to read the list, he will note that all kinds of drugs, which I think the public would find extraordinary, cannot now be prescribed. The list includes Barker's Liquid of Life, Dr. Williams Pink Pills, Mrs. Cullen's Powders and Rock Salmon Cough Mixture. I have no objection to people using Rock Salmon Cough Mixture, but I have the strongest objection to the taxpayer picking up the bill for it.
Mr. Gregor MacKenzie: If the Secretary of State looks at the first item under "Analgesics" he will see that doctors are now to be permitted to prescribe aspirin tablets. Will people be asked to pay £1·80 for a bottle of aspirin tablets?
Mr. Fowler: If the right hon. Gentleman looks at the list he will see that a much wider range of analgesics will
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be available. The advice of my medical experts on the independent committee is that that range of drugs will be adequate to meet all clinical needs.
Mr. David Crouch: Does my right hon. Friend agree that our principal concern should be for the patient rather than about telling the doctor what he may or may not do? Would it not be wiser to leave the doctor with his freedom rather than restrain an innovative and successful industry? Would it not be better to use education rather than edict to achieve the economies that are sought by my right hon. Friend?
Mr. Fowler: My hon. Friend must recognise that I am trying to seek value for money throughout the whole of the NHS. That means that I am trying to ensure that money is directed towards patient care. I do not think that it would be defensible for me or the Government to leave any aspect of the NHS—the drugs bill or any other item—out of that scrutiny. That is what we have done. That is why I believe that this policy is right. I emphasise again for my hon. Friend's benefit that 95 per cent. of the drugs that will not now be prescribed do not require a prescription in any event. That is a fairly conclusive answer to my hon. Friend's fears.
Mr. Laurie Pavitt: I remind the Secretary of State that he is the first Minister of any political persuasion since the inception of the Health Service to interfere with a doctor's clinical freedom. Is this not a precedent? When a professional politician can order a doctor as to the treatment he will give, it goes beyond pharmaceutical services. It is really a red light showing throughout the NHS. Does a doctor—not a rural doctor—prescribing privately to a patient on his list have to charge the patients a fee? Does the doctor have to remove the patient from his list? Does the right hon. Gentleman accept that clinical needs cover more than just the ingredients of a pill or medicine that is delivered? A range of aspects is covered. A doctor is the only person able to decide the best treatment for his patient. A doctor can take a million different approaches because of his knowledge of his patient.
Mr. Fowler: The hon. Gentleman will know that a doctor cannot charge a fee for a prescription. On the hon. Gentleman's first point about my being the first Minister to interfere with the freedom of prescription, I would put it another way: this Government are the first Government to tackle the problem of the drugs bill inside the NHS.
Mr. Pavitt: The right hon. Member for South Down (Mr. Powell) did.
Mr. Fowler: I thank the hon. Gentleman. That was another Conservative Government. This Government act when the Opposition have just wind and hot air.
Several Hon. Members rose—
Mr. Speaker: Order. In view of the great interest in this statement, I shall allow questions to continue until 5.10 pm.
Mr. Robert McCrindle: On the issue of clinical freedom to which the hon. Member for Brent, South (Mr. Pavitt) referred, does my right hon. Friend agree that this same freedom is extended in no other country that has a publicly financed national health service? Why, therefore, is it considered that complete clinical freedom should prevail only in this country?
Mr. Fowler: My hon. Friend is right. There are restrictions of one kind or another in virtually every other country in western Europe. This is a sensible policy, which other Governments have accepted. I ask the House to accept that the vast majority of the drugs that will not be prescribable under the NHS do not require a prescription in any event. This means that people can buy those drugs over the counter and do not require a doctor's prescription.
Mrs. Renée Short: Not long ago the Minister of State told me in answer to a parliamentary question that the estimated savings from the limited list will enable the Government to maintain the level of expenditure announced in the autumn statement. The Secretary of State has clearly retreated from that position. How will he know what savings have been made? Will the right hon. Gentleman explain to the House the mechanism for checking that amount?
Mr. Fowler: We have not retreated from that position. The result of the consultation is that our original estimate of up to £100 million, which was a rough estimate at that time, has been reduced to £75 million. We always recognised that the consultation would mean reduced savings. Our aim now is to look for additional ways of obtaining better value from the drugs bill. One of the encouraging aspects of this debate has been the fact that more attention than ever before has been given to this issue. I hope that we shall achieve further savings through better prescribing and more competition in the generic manufacturing of the drugs on the limited list.
Sir David Price: I ask my right hon. Friend, in his capacity as the sponsoring Minister of the pharmaceutical industry, what effect his new list will have on employment. My right hon. Friend will be aware that both sides of the House have received vigorous representations from the pharmaceutical industry telling us that his original list was destructive of jobs.
Mr. Fowler: It would be sensible for the pharmaceutical industry to look at the new extended list before rushing into any kind of estimate. I want to emphasise two points. The Government entirely support a prosperous pharmaceutical industry, and the industry recognises that. It also recognises that it does not want a change of sponsorship from the Department of which I am Secretary of State. The research into some of the most important drugs in the most crucial areas would be affected by a policy of generic substitution—it will not be affected by the policies that I propose.
Mr. Charles Kennedy: Does the Secretary of State agree that the lack of initial consultation with the medical profession gave rise to the legitimate fears about the list being expressed by many people? Had he consulted initially with the medical profession on the basis of the Greenfield report, he could have presented the House not with indiscriminate generic substitution but with generic substitution involving medical consent, which would have led to greater savings than those that he has predicted this afternoon.
Mr. Fowler: The hon. Gentleman's last point is entirely wrong. If he believes it, he should do a little more homework on the subject. It is bizarre to suggest that we need more consultation and more talks about how we should try to reduce the drugs bill. Ever since I have been in my Department—three and a half years—and for
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years before that we have talked about this subject and debated it in the House. What is required are decisions, and what I am putting forward is the basis of a reasonable decision for this House to reach.
Mrs. Virginia Bottomley: Will my right hon. Friend comment on the recent advertising campaign by the pharmaceutical industry? Does he regard it as a shameful example of exploiting people's fears and putting self-interest before public interest?
Mr. Fowler: The Association of the British Pharmaceutical Industry—and in some ways it does not speak for all the excellent companies—has gone entirely over the top in its advertising campaign and has sought to raise fears unnecessarily. When the only solution to the problem that the association puts forward is that of taking away exemptions from old people, I find it extraordinary and hypocritical that it should mount an advertising campaign in which it claims to be defending NHS patients.
Mr. Harry Ewing: Is the right hon. Gentleman aware that any Secretary of State with responsibility for the NHS who begins with a restricted list of 30 items and then returns to the House with 100 items has shown himself wholly unfit to have the care of the Health Service in his hands? Does the right hon. Gentleman admit that, although he is leaving 100 items on the list, he is taking 1,800 items off the list? Of those, the vast majority are prescribed for old-age pensioners. Is not the Secretary of State condemning old-age pensioners to having to buy their medicines across the counter?
I congratulate the 54 general practitioners in the constituency of the Under-Secretary of State for Scotland, the hon. Member for Argyll and Bute (Mr. MacKay), who inspired the Under-Secretary to fight a little harder than he usually fights to ensure that the position of the prescribing doctors would be preserved. Will the Secretary of State tell the House whether it is the Government's intention to buy back from the pharmacists the drugs that they hold in stock and that will now be removed from the list?
Mr. Fowler: I do not think that the hon. Gentleman has done any better than his hon. Friend the Member for Oldham, West (Mr. Meacher) who began the questions. We always said that we would consult, and that consultation has provided a list that is more extensive and which meets all the clinical needs of patients. That is what the consultation was about. I share the sentiments of the hon. Gentleman—I am glad to agree with him on one point—in his admiration for the views put by my hon. Friend the Under-Secretary of State for Scotland on dispensing doctors. They have been invaluable in helping the Government to come to a decision.
Rev. Martin Smyth: On a point of order, Mr. Speaker. I think that I may have had a response, from a sedentary position, to my question to the Secretary of State on whether the Secretary of State for Northern Ireland—
Mr. Speaker: Order. That is not a point of order for me. The hon. Gentleman is seeking to raise a question with the Secretary of State, which is not a matter for me. It is unfair on hon. Members who wish to contribute to the following debate to extend questions on the statement, which have already continued for much longer than I originally suggested.
Rev. Martin Smyth: How can Northern Ireland Members raise issues affecting the NHS when we have

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been told that they have been turned over to the Northern Ireland desk, especially as this is a national debate? Ministers from the Welsh and Scottish Offices were present on the Treasury Bench but Northern Ireland was not represented. I asked the Secretary of State a specific question, which I think he answered from a sedentary position—
Mr. Speaker: Order. I suggest that the hon. Gentleman should table a question on this matter or write to the Secretary of State.

Skillcentres
5.16 pm
The Secretary of State for Employment (Mr. Tom King): With permission, Mr. Speaker, I should like to make a statement about skillcentres.
I advised the House on 29 November of the Skillcentre Training Agency's proposals to the Manpower Services Commission. On 24 January, the chairman of the commission informed me of the commission's conclusions.
The proposals for the reorganisation of the skillcentre network are designed to eliminate the present waste of resources and to enable the funds thus released to be employed in substantially increasing the number of training opportunities.
The proposals form part of the adult training strategy adopted by the commission over a year ago, after the widest possible consultation. Under that strategy, the number of adults being trained under the commission's programmes is planned to rise to 250,000 by 1986–87. That is more than double the 1983–84 figure. It includes a substantial increase in the number of unemployed helped. All parts of the country will benefit from this expansion.
The reorganised skillcentre network has an important role to play in further development of training. I very much welcome the emphasis the centres are now putting on new and higher technology skills, which will now be more widely available. I have today confirmed again to the chairman of the commission further capital investment in the network of £10·5 million for 1985–86. The addition also of a new 300-strong mobile instructor force is an imaginative and positive innovation. It gives greater flexibility, and allows coverage in remote areas not previously covered by the skillcentre network.
I have now considered the proposals, taking into account the evidence given to the Select Committee on Employment on this matter and all the further representations made to me. Following consultation with my right hon. Friends the Secretary of State for Scotland and the Secretary of State for Wales, I have today written to the chairman of the commission, and I am placing a copy of my letter in the Library.
In my letter, I have asked the commission to implement the agency's proposals. I have asked the chairman to make quite sure in doing so that when any closures are involved, they should not take place until satisfactory alternative provisions have been identified. I have asked that the fullest consultation takes place with the staff and trade unions, with particular regard to negotiating new working practices designed to help the overall efficiency of the network, and to avoiding compulsory redundancies wherever possible.
The proposals for the reorganisation of the skillcentres make sense as a necessary step in improving the cost-effectiveness of training programmes, thus enabling substantial expansion in training opportunities, for unemployed as well as employed people, throughout the country.
Mr. John Prescott: This is a shameful statement. It calls for the closing of 29 skillcentres, the scrapping of their equipment, the scrapping of jobs for hundreds of skilled instructors at a

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time when Britain has more than 1.5 million long-term unemployed, and the least qualified labour force of any developed economy—all this at a time when, according to the CBI, industry is desperately short of every kind of skill. This will be music to the ears of our competitors, and it will add insult to injury. Instead of a justified increase in the number of places, the Government's emphasis is simply on quantity rather than the quality of skills. The Secretary of State is a disgrace to his office and responsibilities, quite apart from his shameful behaviour in joining with management to intimidate workers against joining their protest to this House last week.
Will the right hon. Gentleman confirm that this is now a Government decision to close these skillcentres and to sack hundreds of skilled instructors? He cannot hide behind the commission, given that the majority of commissioners are against these proposals. Will he reaffirm his comment to the Employment Select Committee that he would be loth to go against the majority of the commission? If that is the case, why did he do so?
Is not the real reason for these closures the financial remit which the Treasury has set for the Manpower Services Commission, involving the closure of six profitable centres in London, Gloucester, Bristol, Southampton and Medway? What kind of market economics is that?
Does he accept that the Opposition welcome any proposal to increase training facilities, but we do not believe that the quantity of training should be increased and improved at the expense of quantity — [HON. MEMBERS: "Quality."] I apologise, that is what I meant. I hope that my point has got across to simple minds.
Does not the Secretary of State recognise that these proposals are a kick in the teeth for the 1.5 million long-term unemployed, who are desperate for such training courses? At a time when the Government have abolished industrial training boards, and given the collapse in the number of apprenticeships, it is hypocrisy for the right hon. Gentleman to talk about improving the quality of training.
Is he aware that the London Business School report, produced for a Select Committee of this House, emphasised the future viability of the network and made it clear that if policies such as these were applied to the whole network, the remaining centres would be unviable and could face possible closure? Is the right hon. Gentleman aware that his claim about yesterday's skills provided by yesterday's instructors finds no echo in industry, where there is a desperate shortage of every kind of skill? What is his definition of yesterday's skills which are provided by the existing centres?
Mr. King: It would be shameful if anyone in my position allowed the losses that are occurring and the under-use of capacity to waste existing financial resources, thereby preventing those resources from being made available to absolutely essential training which is needed.
I hope that the hon. Gentleman has studied the evidence given to the Select Committee. He will know that the effect of the proposals for the Skillcentre Training Agency will reduce available places from 17,000 to 13,000. He will also know that the number of places taken up this year
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is only 12,500, and that more than £20 million in lost money for under-used places could have gone towards training other people.
It is a sad reflection of the present employment situation and the change in skills that less than half those coming out of skillcentres find occupation in the trades for which they have been trained. Against that, there is an urgent need to ensure that training is increased in those areas where there are now skill shortages and where there is a real opportunity to ensure that people obtain skills which will give them the best chance of obtaining jobs.
Several Hon. Members rose—
Mr. Speaker: Order. I again remind the House that an important debate is to follow, but because of the great interest in this matter I shall allow questions to continue until 5.50 pm and then we shall have to move on.
Mr. Bruce Millan: The Secretary of State referred to under-used places, but is he aware that the skillcentre in my constituency has such places because it has been deliberately run down in anticipation of the decision that he has announced today? In any case, are not a majority of the MSC commissioners against these proposals? How, therefore, can the right hon. Gentleman go ahead on that basis, unless this is a decision of the Secretary of State rather than the MSC?
Mr. King: The right hon. Gentleman makes a perfectly fair point, but I am not sure whether I agree with it. As he knows, since the MSC met and the chairman wrote to me, I have received a letter from one Commissioner who reported the commission's conclusions to me. That gentleman's proposal was not that the scheme should be rejected but that it should be postponed. Against that background, the adult training strategy has been agreed unanimously by all the commissioners, as has the cost recovery objective of the Skillcentre Training Agency. Are we then to have a further period of uncertainty, and should the commission reduce the training opportunities available which could otherwise be funded from the savings that could be made by eliminating waste, or should a decision be taken now? My judgment—and I have come straight to the House to announce it—is that a decision should now be taken.
Mr. Andrew Rowe: Is my right hon. Friend aware that the Association of British Chambers of Commerce recently published a report on education and training, which makes clear its desire that employers should have the major say in the quality of training? Is he also aware that in the evidence given to the Select Committee it was made perfectly clear that the employers were not entirely satisfied with what was happening, and it was felt that the creation of mobile instructors, using employers' premises and equipment, was a much more satisfactory way of meeting training needs?
Mr. King: I accept what my hon. Friend has said. Perhaps I can also reply to the point made by the hon. Member for Kingston upon Hull, East (Mr. Prescott) about yesterday's training for yesterday's skills. I have never used that phrase. The truth is that the demand for some skills has diminished, but in my statement I paid tribute to the valuable part that the skillcentres have to play. Anyone who looks at these figures objectively will see that at present the range of the network is out of phase with training needs. There are urgent needs for training in other

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areas, not least an expansion in the training programmes which I have announced to enable the unemployed to get back to work. There is simply no point in allowing losses to mount up in bricks and mortar and to under-use facilities of various kinds when that money could be made available for training people. We are in the business of giving the maximum help to people, not to institutions.
Mr. Eric Forth: My right hon. Friend will be aware of the great concern that has been caused in Redditch in my constituency by the proposed closures. If I noted his words correctly, he said that no individual closure would take place until satisfactory alternative provision had been identified. I believe that my constituents will take some comfort from that. Can he assure me that in an area such as Redditch the full resources released by the closures will be put into additional training facilities in the locality and that, in particular, employers will have a greater incentive to provide private training facilities on the premises and on the job? Let us get back to the old apprenticeship schemes to which we all believe we should return.
Mr. King: I certainly give that assurance to my hon. Friend in relation to the requirement laid on the chairman, which my hon. Friend correctly observed in my statement.
We are trying to make training as appropriate and flexible as we can. I have made it clear that skillcentres have an important part to play, but at present their capacity is out of scale with the demand for them. We need to use the resources in other areas. If we can achieve this change and get the strategy going, we shall ensure that there will be a 157 per cent. increase by 1986–87 in the number of people in the west midlands area who will have training opportunities. I make no apology for making that possible.
Mr. David Penhaligon: Does the Secretary of State realise that his statement would be more credible if he identified the skills for which there will be less training and attention through these modifications? I am sure that he would not try to mislead the House that that is not the conclusion of his statement. The hon. Member for Mid-Worcestershire (Mr. Forth) referred to "satisfactory alternative provisions". Will the Secretary of State explain what that means? Does it mean satisfactory in terms of quality or quantity? Who will judge whether an alternative is satisfactory, because unless it is monitored that statement is meaningless, as I suspect it is?
Mr. King: I think that the hon. Gentleman is familiar with the structure of the MSC and with the area manpower boards, on which industrialists, educationists, trade unionists and local people sit and work with the MSC. They work extremely carefully. I am sure that the hon. Gentleman takes an interest in the training that takes place when he asks what the equivalent alternative provision is. We are now launching a whole range of different schemes. I would have thought that he of all people, as the representative for Cornwall, would recognise the values for rural areas, such as those that he and I partly represent, of having a mobile instructor team as a reinforcement and of making the very best use of the facilities that exist. I hope that he will recognise that this is an attempt to expand training opportunities and to make them as effective and relevant as possible.
Dr. John G. Blackburn: Will my right hon. Friend accept the appreciation of my constituents at
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the Dudley skillcentre that the Minister of State, Department of Employment came and spent many hours considering the position there? Will my right hon. Friend give an assurance that there will be a smooth transition, if there is to be a closure, which is subject to consultation, and that it is critically important that training is expanded at in-house level? My only hope is that the money which is to be allocated will produce the figures that he quoted for more training in the area.
Mr. King: I am aware of the close interest that my hon. Friend and my hon. Friend the Member for Mid-Worcestershire (Mr. Forth) take in their local skillcentres. I can certainly give the assurance that my hon. Friend seeks.
Mr. Robert N. Wareing: How can it possibly make sense to close a skillcentre in an area where 100,000 jobs have been lost and 449 factories closed since the Government came to power in 1979? Is it not incumbent on the Secretary of State to tell the House what the real alternatives are for the people of Merseyside as a result of the closure of the Liverpool skillcentre? Does it not smack of putting the cart before the horse to tell the House that he will close the Liverpool skillcentre before he has alternatives, bearing in mind that many jobs are being lost, including 300 at Guinness, precisely because we do not have the skills for the new technology? We in Liverpool have a right to know what the alternatives will be before a closure takes place.
Mr. King: I am not sure that the hon. Gentleman listened to my statement. His request for an assurance that the skillcentre should not be closed before alternative arrangements were made, was precisely the point that I sought to make because it is so important. I hope that he will recognise that, as a result of the reorganisation, we are likely to be able to double the opportunity for training for people in Liverpool and Merseyside. I would have thought that he would have welcomed that.
Mrs. Angela Rumbold: While I accept the sense of my right hon. Friend's proposals for extending training opportunities, will he reiterate his assurances to my hon. Friends the Members for Mid-Worcestershire (Mr. Forth) and for Dudley, West (Dr. Blackburn) that when constituents, such as mine, are likely to be faced with the closure of a skillcentre, the MSC will make every attempt to explain what will happen with the greatest possible clarity?
Mr. King: I certainly accept that point. Part of the reason why I made the statement today was that there should not be any continuing uncertainty about the position.
Mr. Martin Redmond: Does the Secretary of State agree that this is another example of the short-sighted short-term policy pursued by the Government? The people in Doncaster will be disappointed. Will he assure the House that if there are no suitable acceptable alternatives, those skillcentres will remain open so long as there is a need for them?
Mr. King: I have spoken to the hon. Gentleman about that. He came with his colleagues to see me about the position in Doncaster. I understand their anxiety. In my statement I specifically sought to give the assurance that he seeks. The hon. Gentleman talked about the shortsighted attitude of the Government, but these proposals

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derive partly, as is widely known, from the training division of the MSC and its identification of need. The funds are there, and the question is what is the best way to use them. Opposition Members find it easy to stand back from the reality of these matters, but if they were faced with the same choice, would they waste money on unused bricks and mortar, or would they insist on making training available for people?
Mr. Christopher Chope: How does my right hon. Friend's strategy justify closing the annexe in Southampton, when both the main centre and the annexe are making a profit, when it is an area of recognised skill shortage, when it has the support of the local chamber of commerce, and when the people who work there work hard and are highly respected? Will he reconsider the matter and, if he will not, will he consider the alternative option of privatisation?
Mr. King: My hon. Friend will understand that it is a question of available capacity. If there is under-used capacity it makes good sense to use it in the most effective way. The question is not whether an individual centre is profitable so much as where capacity is. We want an efficient and relevant network. I certainly take note of my hon. Friend's comments, and I know that he has taken a close interest in the Southampton annexe.
Mr. Martin Flannery: Why does the Secretary of State persist in conveying the impression that he does not know what on earth we are worrying about, when we are all deeply worried about what he is doing? Does he remember that last week, despite his intimidation, many people came here to lobby the House? There would have been a bigger lobby if they had not felt intimidated and threatened with the loss of their jobs. Is it not a fact that 29 skillcentres will be closed, that many people who need training for the new technologies and who are out of work want to be trained but will not be trained, and that those people who came here know that more than 1,000 of them will lose their jobs? That is what we are worried about. We have come for bread but he only gives us a stone. He should explain to the House the words "satisfactory alternative provisions". No hon. Member believes that those satisfactory alternative provisions will come about, because the unemployed and the Opposition mistrust the Government and believe that an increasing number of people will be out of work.
Mr. King: The hon. Gentleman made an absolutely untrue allegation, which was referred to obliquely earlier, that somehow I sought to ban civil servants from taking industrial action about this matter. Ministers were not consulted. Civil servants followed normal personnel arrangements and asked, not whether they could come, but if they could demonstrate at the House on annual paid leave. Without consulting Ministers, civil servants observed the rules that had traditionally operated throughout the life of the Civil Service. I must tell the hon. Member for St. Helens, North (Mr. Evans), who I think was the parliamentary private secretary on one occasion to a Minister in the Labour Government, that we identified the occasions when precisely the same refusal was given. A refusal was given by the Labour Government to civil
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servants who sought during the winter of discontent and the Society of Civil and Public Servants' strike to take annual paid leave. So I hope that he will keep quiet about that.
I take the matter extremely seriously and I respect the right of people who wish to demonstrate, to do so, not on annual paid leave, but with the loss of pay, as under the standard Civil Service procedure. If the hon. Gentleman has not understood the point of my statement, if he thinks that losses should be made in the upkeep of old buildings that are being under-used, and that money should be denied to people for training, I am glad that he is not in charge of our training programmes.
Mr. Robert Hicks: I welcome the concept of the mobile training force, but how many places will be available nationally and how many will be available in the south-west? Can my right hon. Friend outline the basis on which arrangements are to be made?
Mr. King: The MSC intends to make wide use of various alternative provisions, sometimes involving colleges of further education, and sometimes using employers' premises for existing employees. Indeed, on Friday I saw excellent facilities at a substantial workshop in Cheshire. Those facilities are now under-utilised, but they could, for example, be employed by the MSC. The numbers involved will be as many as can get on to the appropriate programme.
Mr. Sydney Bidwell: Does the Secretary of State realise that the deep concern goes far beyond the staff affected? Today's statement will not end the public's puzzlement about why skillcentres are being closed when the country is desperately in need of skill. Have the disabled training facilities often found at such places been taken on board by the Ministry in its forward planning?
Mr. King: I think that the public were probably puzzled as to what on earth was going on in maintaining a training network that was only two-thirds used, especially when only half the people being trained used the skills. After all, the public know that there are serious skill shortages in other areas for which resources are not available. That was the cause of their puzzlement. If I am to be criticised, it is perhaps because the situation should have been tackled a long time ago. However, we shall certainly seek to maintain provision for training the disabled.
Mr. Richard Holt: Does my right hon. Friend accept that misgivings will be felt in Langbaurgh and Cleveland this evening about the decision not to keep open the Middlesbrough skillcentre? Although the additional finance is welcome, if skillcentres are failing to do the job for which they were set up they should be revamped, reorganised and set up again properly. To close them before the experimentation of the travelling trainers has been carried through is to throw out the baby with the bath water.
Mr. King: I understand my hon. Friend's concern. I know of his close interest in the subject, as he has talked to me about such matters. He will realise that after these changes, the skillcentre network will have more capacity than is now needed, and that is even before we consider mobile training instructors, and so on.

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The Opposition are being singularly unconstructive, but I hope that my hon. Friend will realise that the MSC and the Skillcentre Training Agency have made a determined attempt, with the support of the training division and professional trainers, to ensure that the very best training facilities are provided within the resources available.
Mr. Gareth Wardell: May I again ask the Secretary of State a question about the closure of the Llanelli skillcentre which serves Dyfed and West Glamorgan? Perhaps he will do what he failed to do on 29 November and answer my question. That skillcentre has one of the highest occupancy rates of any skillcentre in Wales and one of the best records for placing trainees in jobs and has responded over the past 18 months by providing courses to keep up with the technological changes. Will the right hon. Gentleman tell us whether what I have said is incorrect? If it is not incorrect, let us have the facts.
Mr. King: I understand from my hon. Friend the Minister of State that it is certainly true that the skillcentre has improved its occupancy rate, but I think that there is still under-used capacity there. The matter has been fully discussed with my right hon. Friend the Secretary of State for Wales, and he and my hon. Friend the Minister are determined to ensure that the undertaking given at the end of the statement about alternative provision is fulfilled.
Mr. Peter Thurnham: Does my right hon. Friend agree that the purpose of training is to spend money not on buildings but on the improvement of individuals' skills? Will he give some assurances about the training of the disabled in the north-west in view of the proposed changes at the Denton skillcentre in Manchester?
Mr. King: We certainly seek to protect the position of the disabled. I cannot give my hon. Friend the full details about the north-west now, but I shall arrange to write to him, and will give him the full details. However, I am grateful to him for stating so clearly the essential point at stake. If we are to compete with the new technologies and to meet the needs of an expanding economy in the years ahead, we must modernise our training. If the Opposition stick to their present attitude, when the lessons to be drawn about the steps that should be taken are so patently obvious, I tell them that the Government do not intend to sit back and to allow training to fossilise. We will modernise it and give the best chance of jobs for our people.
Mr. James Hamilton: Will the right hon. Gentleman confirm that the Secretary of State for Scotland was with him when the closures were discussed? Did the Secretary of State for Scotland acquiesce in the closures that are to take place in Scotland? Is the right hon. Gentleman aware that the commission reached its decision with the smallest majority possible, and that one of its members saw the error of his ways and would have wanted to change his vote if the commission had been recalled? Is the right hon. Gentleman further aware that one member of the commission was inadvertently absent on other business but would have voted for the retention of those centres? Given that, and the fact that Strathclyde region has the highest population of any region in Scotland and the highest number of people unemployed, will the right hon. Gentleman reconsider his decision and decide to save those centres in Scotland?
Mr. King: I consulted the Secretary of State for Scotland on these matters. When the hon. Gentleman referred to an absent commissioner, I think that he was referring to a TUC commissioner, and his vote was also considered. The commission's views, and the letter that the chairman of the MSC wrote to me — a copy of which has been placed in the Library — make it clear that the views of those not present were taken into account. I understand that that letter had the full support of every member of the commission.
Mr. David Maclean: Will my right hon. Friend ignore the hysteria that is usual for Opposition Members when any proposal is made to improve the quality and quantity of something in this country instead of just throwing money at it? Will he take it from me that the proposal for a mobile force of 300 instructors is most welcome? If it is discovered that we need more of them, will he guarantee to increase the numbers to whatever figure is necessary, as that will help rural areas such as mine?
Mr. King: I am very pleased to have been able to announce the increase in the number of training opportunities. I am determined to see how we can improve training. But to do that, we must be ready to make changes. We cannot allow the situation to remain as it has always been, when the facts are staring us in the face and we know that losses are being incurred by a failure to act. We will act, but we shall do so entirely in the interests of training opportunities for our people.
Mr. Stephen Ross: Will the Secretary of State confirm that the annexe to the Southampton skillcentre, which he intends to shut, operates at a profit, has a waiting list of applicants, and is used largely by local firms, which are very satisfied with it? Will he ensure that the instructors who will not be so mobile at last visit my constituency—I hope that he is listening—as we could do with them? The right hon. Gentleman is shutting a profitable annexe and skillcentre, which is contrary to everything he has said from the Dispatch Box.
Mr. King: If an hon. Member cannot listen with both ears at the same time, he should not be in the House. But, to be serious, I am well aware of the concern felt about the Southampton annexe. I know that my hon. Friend the Minister of State has had discussions on that matter. He will be reporting hon. Members' views on certain aspects to the chairman of the commission. I take note of the hon. Gentleman's comments.
Mr. Harry Greenway: Is my right hon. Friend aware that I made a further visit to the excellent Perivale skillcentre in my constituency last week? May we have an assurance for the people working there, because some of them fear that they may be replaced by people who have served longer at other skillcentres which face closure? Will he also examine the cost recovery principle and assure me that he will not press that to the ultimate, bearing in mind that I chaired a conference designed to bring more money into that skillcentre? That has had some success, but it is not easy.
Mr. King: I am grateful to my hon. Friend for the close interest which he takes in his local skillcentre. His question is a sign of that interest and the positive role that he has played. My hon. Friend asks about changes in staffing and what might happen after reorganisation. That

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is a matter for the Manpower Services Commission and the Slcillcentre Training Agency. They will take note of my hon. Friend's comments.
Mr. John Evans: Since the majority of MSC commisioners now disagree with the proposal to close 29 centres, and in view of the Secretary of State's previous statements about his inability to direct the MSC, could the MSC now reject the proposal in his statement?
The Minister says that no individual skillcentre closure will take place until a satisfactory alternative has been provided. Will he explain what is the satisfactory alternative to a good, well situated and well run skillcentre? Why close valuable skillcentres when the Minister has already conceded the need for satisfactory alternatives?
Does the Minister accept that his claim that he is expanding adult training is a charade because he will provide only a smattering of low-level, occasional training? Is not that completely in line with the Tory party's determination to turn Great Britain into a low-pay, low-technology economy?
Mr. King: The hon. Gentleman makes a brave attempt yet again to beat a flagging horse to life. We have discussed the matter long enough this afternoon to know that it simply will not run. The better alternative to many of the skillcentres is the establishment of skill training places that will be used, but put to full benefit and from which people will move to real and full-time jobs. That is better than facilities being under-used and being used by people half of whom will not be able to get jobs in the skills for which they are trained.
Can the hon. Gentleman explain to the House his claims about low technology and an inadequate service when I have just announced an increase in capital expenditure on the reorganised network precisely because we want to take advantages of the new technology?
Mr. Tom Clarke: On a point of order, Mr. Speaker. From the Minister's response to the question by my hon. Friend—
Mr. Speaker: Order. That immediately rules out the point out of order. I can answer points of order only if they concern questions that are put to me for my decision. It is no good drawing my attention to a Minister's response.
Mr. Clarke: Further to the point of order, Mr. Speaker. I was trying to refer to what I thought was your response to what the Minister had to say. I thought that you showed extreme impatience at the length of the reply. If you did, many of us would agree with you. I certainly do. I have been here since 2.45. If you were to make a plea to Ministers to give brief replies so that hon. Members like myself could ask brief questions, we would agree with you.
Mr. Speaker: Perhaps it is a good thing that we do not have television in this place.

"20:20 Vision" Programme
5.54 pm
Mr. Robin Corbett: 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 ban imposed last night by the Independent Broadcasting Authority on Channel 4's '20:20 Vision' programme entitled 'M15's Official Secrets'."
The full IBA saw this programme first in January. It saw it at other times and again last night and decided to stop the public from seeing it. That is a most serious step which inhibits proper public debate on a matter of urgent public importance. It is also an act of censorship by the IBA because it is not a law enforcement agency. It is more properly a matter for the Attorney-General and the Director of Public Prosecutions, after screening.
The film makes allegations about the surveillance methods used by the security services against individuals and organisations who are in no way suspected of terrorist or subversive activities. It alleges that even my hon. Friend the Member for Peckham (Ms. Harman) was investigated, as well as human rights activists and trade unionists. It alleges misdirection of the security services in breach of their own operational rules, which state:
"The Security Services should be kept absolutely free from any political bias or influence."
The programme alleges a clear breach of those rules by the Home Secretary and the Secretary of State for Defence. It is alleged that in March 1983 the Secretary of State for Defence established the DS19 unit to counter the growing effectiveness and popularity of the Campaign for Nuclear Disarmament.
In August 1983 the Home Secretary is alleged to have authorised a phone tap of CND headquarters. This was done for purely party political reasons, in clear breach of the security services operational rules and against assurances about the "entirely legitimate activity" of CND given by the Home Secretary to the House on 20 December 1984 and repeated to the Home Affairs Select Committee as recently as 30 January 1985.
These are serious allegations of political interference and misuse of the security services by Cabinet Ministers and the IBA has prevented proper public examination of them. Because of the seriousness of the allegations the House will agree that they should be urgently debated here. I seek the Adjournment of the House for that specific and important purpose.
Mr. Speaker: The hon. Member for Birmingham, Erdington (Mr. Corbett) 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 ban imposed last night by the Independent Broadcasting Authority on Channel 4's '20:20 Vision' programme entitled 'MI5's Official Secrets'."
I draw the hon. Gentleman's attention to the fact that we may debate matters only when ministerial responsibility is involved. The hon. Gentleman heard what the Leader of the House said at business questions today.
I have listened carefully to what the hon. Gentleman has said, but I regret that I do not consider the matter to

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be appropriate for discussion under Standing Order No. 10, and I cannot, therefore, submit his application to the House.

Royal Air Force
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Neubert.]
Mr. Speaker: Before the Minister opens the debate, I wish to inform the House that I shall impose the 10-minute limit on speeches between 7 o'clock and 8.50 pm. I hope that it will be possible to call all right hon. and hon. Members Who wish to speak in the debate.
5.58 pm
The Minister of State for the Armed Forces (Mr. John Stanley): I am sure that the House will wish to be aware that today, as we debate the Royal Air Force, the funerals of six members of the RAF Germany band have taken place at Rheindahlen. The House will know that the bodies of the other 12 bandsmen and the RAF policeman killed last week have been flown home, in accordance with their families' wishes, so that their funerals can take place in this country. I know that the thoughts and deep sympathy of the House will be with the families of those who so tragically lost their lives.
The RAF is in the midst of one of the largest re-equipment programmes it has had for very many years—a programme that could not have been accommodated on its present scale if the Government had not achieved a real terms increase in defence expenditure of about one fifth since 1979.
The Tornado programme is the centrepiece of the RAF's equipment programme. Another four squadrons of the Tornado GR1 have formed since last year's RAF debate. We now have eight squadrons in all—three in the United Kingdom and five in RAF Germany. Eventually, 11 squadrons will be equipped with this aircraft, including two in the reconnaissance role.
The Tornado GR1 is capable of the highest levels of performance in the strike/attack and reconnaissance roles. The aircraft can exceed 800 knots at sea level and twice the speed of sound at high level. Depending on its mission, the GR1 can operate at ranges of up to 750 miles, though this can be extended by air-to-air refuelling. The GR1 is capable of operating at night in all weathers. With its ability to penetrate enemy air defence at low level and at high speed, and its highly accurate bombing performance, the GR1 represents a giant leap in capability over the aircraft that it has replaced.
I referred to the accuracy of the Tornado's bombing performance. The House may know that, last October, the RAF entered the Tornado, supported by Victor tanker aircraft, in the prestigious and fiercely contested Strategic Air Command bombing competition in the United States. This is a long-standing competition and it was ambitious to enter the new Tornado in a foreign competition so soon after its entry into service against well established American B52s, and American and Australian F111s.
The results were outstanding. Our teams came first and second out of 42 crews in the Curtis Le May bombing competition for overall high and low level bombing, first and third out of eight crews in the Meyer trophy for operational effectiveness, and second out of 21 teams in the Mathis trophy for performance over all six competition missions. These results reflect the greatest credit on the Tornado crews and their supporting tanker and engineering crews, on the effectiveness of the Tornado aircraft and on the capability of British industry.

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Following on behind the Tornado GR1 is the air defence variant, the F2. The first two Tornado F2s have been delivered to RAF Coningsby for ground familiarisation and training, and instructor training with British Aerospace has now commenced. A total of seven squadrons are planned, and the F2, with its excellent range and loiter capability, will be a key element in the defence of the United Kingdom's airspace into the 21st century.
There have been some difficulties with the development of the F2's air defence radar, but these have now largely been overcome. This will somewhat delay the build-up of squadron deployment. Nevertheless the RAF will have received a small number of operational aircraft by the end of this year.
Mr. A. E. P. Duffy: Will the Minister say something about the "identification, friend or foe" system? I understand that there is no standardised NATO version yet.
Mr. Stanley: The hon. Gentleman is right. The matter has been under deliberation in NATO circles for some time. There has been a difference of view. My right hon. Friend the Secretary of State and Ministers have done everything possible to resolve the matter but, as the hon. Gentleman knows, we are not able to resolve it on our own. In the meantime, we are seeing what improvements can be made in our own IFF capability. It is an extremely important issue and I am grateful to the hon. Gentleman for highlighting it.
The defence of the United Kingdom's airspace will continue to be the responsibility of the RAF's Phantom squadrons as well. There are currently five Phantom air defence squadrons in the United Kingdom. Two will be run on following the introduction of the Tornado F2. Allowing for the phasing out of the two remaining Lightning squadrons, this will give the United Kingdom an increase in its front line air defence squadrons from seven to nine.
To make good the shortfall in immediately available aircraft for the United Kingdom's air defence caused by the deployment of Phantoms to the Falklands, a squadron of Phantom F4J aircraft has been purchased from the United States. This squadron formed at RAF Wattisham last November.
As the House knows, to provide additional aircraft for the air defence of the United Kingdom, the Hawk trainer is being modified to carry Sidewinder air-to-air missiles. A total of 72 aircraft are being modified. This programme is ahead of schedule and will be completed in 1986.
In considering the long-term future of the Buccaneer force, various numbers of aircraft were put forward. The latest position is that we plan to update 42 Buccaneers—enough to run on two squadrons in the maritime strike/attack role, and the training unit, well into the 1990s. They will be armed with the Sea Eagle anti-ship missile, which will enter service later this year. This sea-skimming missile will considerably enhance the Buccaneer's effectiveness by allowing low level attacks on surface ships at long range.
Mr. John Wilkinson: Is it intended to modernise the two squadrons of Phantoms that are to be retained as the Buccaneers are being modernised for their continuing role?
Mr. Stanley: My hon. Friend is referring to the avionics update on the Buccaneers. We hope to be able to reach a decision on that shortly. I cannot tell him whether there is a similar avionics update on the Phantoms to which I referred. If I may, I shall ask my hon. Friend the Under-Secretary of State for Defence Procurement to deal with that in his winding-up speech.
The modernisation of the RAF's Nimrod maritime reconnaissance and anti-submarine aircraft will be completed by the end of this year. The Mark II Nimrod is one of the most potent maritime patrol aircraft in the world. In the anti-submarine role, the Nimrod is equipped with advanced sonobuoys and on-board computers for location and tracking. Surface shipping is identified by the Searchwater radar. The Nimrod can be armed with the Stingray anti-submarine torpedo and the Harpoon standoff missile for use against surface ships. Each Nimrod will be provided with an air-to-air refuelling capability which will enable a single aircraft to maintain continous surveillance over 10,000 square miles of ocean and spend over 10 hours on task.
As to the RAF's support aircraft, the programme to stretch 30 of our 60 Hercules is nearing completion. Twenty-three of these aircraft are being fitted with station-keeping radar equipment, which will allow the aircraft to maintain formation in all weathers and thus give us a greatly improved parachute assault capability.
May I pay a warm tribute to the Hercules crews and the Victor tanker crews for the outstanding way in which they have maintained the Falklands airbridge? Five days each week, Hercules undertake this 13 hour in-flight-refuelled journey with a 90 per cent. on time arrival record. It is a very long flight, a long way from diversion airfields, with weather that is always uncertain and frequently awful, and with plenty that can go wrong. Maintaining that airbridge has required from air crews and ground crews alike skill and stamina of a very high order. The Hercules crews have unfailingly demonstrated both.
During the past year there has been further substantial progress in improving the RAF's air-to-air refuelling capability, which is of much major operational importance. To supplement the two Victor tanker squadrons, six TriStars have been purchased and, with a squadron of VC10s, are being converted to the tanker role. The TriStar will retain a passenger and freight capability which will greatly enhance the armed forces' strategic mobility.
The Victors, which have been in service since the 1960s, will reach the end of their useful lives by the end of the decade. As a first stage in a replacement programme, three more TriStar 500s have been bought from Pan American World Airways during the past few months. Two of these aircraft have been handed over, the remaining one will be delivered in April.
On the improvements to existing aircraft, I shall deal finally with the helicopter force. The RAF has taken delivery of three Chinook helicopters out of the eight ordered after the Falklands conflict. Exercise Lionheart confirmed that these large helicopters have a very important part to play in support of the Army in Germany.
I have given the House details of the expansion and improvement of the RAF's existing aircraft. I shall now consider future aircraft. First, I should like to refer to the Nimrod airborne early warning aircraft project, which was started by the Labour Government in 1977 and has been continued by the Conservatives. There is no doubt that the

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requirement to replace the AEW capability of the current Shackleton force was, and remains, very pressing. The Nimrod airframe has been successfully converted for the AEW role. Unhappily, major technical problems have been experienced in the development of the AEW radar and the associated electronics. We are now in a position where approximately £800 million has been spent or committed for the creation of a force of 11 aircraft. The imperative requirement is to devise the quickest and least costly route to secure the required operational capability of the AEW system. Discussions are continuing with the company to that end.
I cannot at the moment say what additional cost will be involved in achieving the required operational capability but, as of now, our best judgment is that an operational AEW capability for the Nimrod should be achieved in 1987. In the meantime, national AEW cover continues to be provided by the Shackletons. In addition, NATO E3A aircraft are available to provide AEW cover, if necessary, anywhere in the Allied Command Europe area, including the United Kingdom air defence region.
Mrs. Anne Clwyd: Does the Minister agree that the Nimrod failure is the grossest example of the Government's failure to control defence spending?
Mr. Stanley: I agree with the hon. Lady that the project is a very serious example of a major overrun. Major lessons are to be learned from it. This Government have certainly learned such lessons. They are writing contracts now in a very different way from the way in which contracts were written by the previous Administration.
Sir Patrick Wall: Would it not have been much wiser if we had joined the NATO AWACS programme, as many hon. Members suggested at the time?
Mr. Stanley: My hon. Friend has made a very fair point. With the benefit of hindsight, his point is fairly unarguable.
Mr. Gerald Howarth: Could my right hon. Friend tell the House whether, when the Nimrod AEW does finally come into service, it will be a very much more sophisticated and capable aeroplane than the system currently in service with the United States Air Force?
Mr. Stanley: I hesitate to draw comparisons in a very sophisticated electronic area. The European AWACs programme is a NATO programme. The British Nimrod programme is a national programme. We retain the benefit of national tasking as a result of going down the Nimrod AEW route. However, I hope that for this kind of expenditure we shall have aircraft that ultimately will be at least comparable to the NATO alternative.
Mr. Wilkinson: In view of the critical importance to the conduct of the air battle of having an effective airborne early warning system, particularly in today's air environment, could not my right hon. Friend consider the possibility of leasing E3 AWACS aeroplances from the United States until such time as our own Nimrod system becomes operational?
Mr. Stanley: I note my hon. Friend's suggestion. As he will be aware, any such leasing arrangement would obviously result in further additional cost, which would
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have to be accommodated within the overall defence budget. We should have to consider what expenditure would be involved. That expenditure would not ultimately provide any additional hardware and would have to be considered in the context of the kind of sums involved in finally solving the problems of the AEW radar in the aircraft.
Turning to the European fighter aircraft, as the House will be aware, the Royal Air Force will need to replace its Phantoms and Jaguars in the 1990s. An outline staff target for a possible new European fighter aircraft was agreed by the air forces of the United Kingdom, France, Germany, Italy and Spain in December 1983: This was subsequently refined into a European staff target. The feasibility studies of the five countries have been completed and are now being evaluated before being reviewed by the Ministers concerned. Along with our partners, we believe that this collaborative venture can succeed. However, there is a long way to go in defining the next stage of the programme, and I think it is unlikely that we shall be in a position to give a further substantive report to the House for some months.
Mr. Robert Atkins: Does my right hon. Friend recognise that there is growing concern within the industry, at management, design and shop floor level, that we are being outmanoeuvred by the French? That is a matter which my right hon. Friend needs to take on board, as does the Secretary of State. I hope that my right hon. Friend will deal with that point.
Mr. Stanley: Again I note the concern of my hon. Friend. My right hon. Friend the Secretary of State for Defence has great commercial experience. He is not a person who is likely to be outmanoeuvred.
Mr. Lewis Carter-Jones: In 1982 the hon. Member for Dumfries (Sir H. Monro) and I, as two former members of the Royal Air Force, argued the case for a fighter, but it seems that it has slipped and slipped and tonight it has slipped again. The last information I was given was that a decision would be made next month. It appears that a decision will not now be made next month. Can I ask the right hon. Gentleman whether that is so?
Mr. Stanley: I am not aware of the commitment to which the hon. Gentleman refers. We are still evaluating the feasibility studies of the European fighter aircraft. I now turn to the new basic trainer, because I know that the House will wish to hear the current position on the RAF's basic trainer. The "best and final" offers from the four competing companies have been received and are now being evaluated. We shall reach a decision as soon as we can on the alternatives, which still include the option to retain and refurbish the existing Jet Provost aircraft.
Mr. Stephen Ross: When a decision is made, should not the aeroplane that the RAF most wants be provided if its cost is on the right lines?
Mr. Stanley: I assure the hon. Gentleman that all the relevant factors will be taken into account. In two to three years' time we shall be bringing into service the new mark of the Harrier, the Harrier GR5, which is being developed and produced in a collaborative programme with the United States. This aircraft is not a rebuild of the existing Harrier but an entirely new design, which will have a very much greater operational capability than its predecessor, while still retaining the Harrier's unique ability to operate

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from hidden sites away from its main base and close to the front line. We are planning to procure 60 Harrier GR5 aircraft to replace GR3 Harrier squadrons in Germany.
As for future helicopters, the United Kingdom has decided to enter collaborative feasibility studies with France, Germany, Italy and the Netherlands for a future light support helicopter known as NH90. The NH90 could constitute a replacement for the RAF's Puma and Wessex helicopters, which is the subject of air staff target 404. At this stage, however, neither the United Kingdom nor its partners are committed beyond the feasibility studies.
Other options remain for meeting air staff target 404, and the United Kingdom's participation in the NH90 feasibility studies does not rule them out. In particular, the Westland W-30 remains one of the contenders for air staff target 404. Westlands will also take part in the NH90 feasibility studies.
Dr. Keith Hampson: The United Kingdom is keen to take part in such collaborative projects but they do slip a good bit. It is unlikely that the NH90 will be in service before the late 1990s. Surely the Wessex and Puma helicopters could not remain in service until the 1990s and would therefore need to be replaced.
Mr. Stanley: I can assure my hon. Friend that the time scale for the NH90 work is compatible with the need to replace the RAF's Puma and Wessex helicopters. We believe that at this stage it is right to take part in the first stage of an international collaborative project, besides looking at the same time at other options for satisfying air staff target 404.
Mr. Keith Best: If, by means of the NH90 project, a boost is to be given to Westlands which, it appears, is producing an aircraft specifically for air staff target 404 and if in due course it is favoured by the Government, is it not right that another aircraft that was produced specifically for air staff target 412, the Hunting Firecracker, should be similarly favoured?
Mr. Stanley: I do not think that my hon. Friend should think at the moment in terms of "favouring". The Government's view of the situation is that we should look simultaneously at the international possibilities of satisfying the particular requirement, while at the same time retaining the existing options for satisfying AST 404. It does not mean anything more than that.
Mr. Paddy Ashdown rose—
Mr. Stanley: I will give way to the hon. Gentleman but I suggest to the House that, if I give way much more—which I am very ready to do — a good many hon. Members will not be able to make the speeches that I am sure they wish to make.
Mr. Ashdown: I am very grateful to the Minister for giving way, particularly as he knows that I shall probably be touching on these matters in my speech. His statement that the replacement may well be tangled up with the NH90 will come as a great disappointment to many in the RAF and elsewhere. I hope that the Minister will recognise that, if he were to put that policy into operation, he would find that Westlands would be significantly weaker, as a contributor to the NH90, than it would otherwise be if the Westland 30 were now able to be developed to fulfil AST 404.
Mr. Stanley: I note what the hon. Gentleman said. In relation to the NH90, I used the word "could", not "should". No doubt the hon. Gentleman will wish to develop that point further in his own remarks.
I have concentrated so far on the RAF's re-equipment programme. The process of improving the RAF's capabilities does, of course, go well beyond improvements to the aircraft themselves, and I should like to refer to a few of those other improvements.
With regard to missiles, I have already mentioned the introduction of the Sea Eagle anti-ship missile this year. Improvements to current air-to-air missiles such as Sidewinder and Skyflash are being considered, while the collaborative development of the new generation of advanced air-to-air missiles, ASRAAM and AMRAAM continues.
The procurement of the ALARM anti-radar missile for Tornado is progressing well. The missile is being procured as a fixed price package covering both development and production form BAe Dynamics, the prime contractor. We believe that this programme will prove to be a good example of the benefits that the Department, and therefore the taxpayer, can gain from the use of competition in the procurement process, which in this case led directly to our being able to secure a fixed price contract. One wishes that more contracts had previously been negotiated on a fixed price basis.
An improved version of the BL755 anti-armour weapon will enter service this year. It will substantially improve the RAF's ability to destroy the latest Warsaw pact tanks. The Harrier GR3 and later the GR5 will be equipped with this weapon. Also this year we shall see the introduction of the JP233— the airfield attack weapon—which will significantly improve the Tornado's ability to put airfields out of action.
It is not just aircraft and weapons that the RAF needs; it also requires sensors, electronic counter-measures, communications, and so on. I should like to highlight the United Kingdom air defence ground environment, which provides warning of air attack. UKADGE, as it is known, gathers information from a chain of radars and other sensors.
In the United Kingdom, the network of ground radars and associated command, control and communication systems is being completely replaced. For example, in each air defence sector operations centre, there will be five computers, each of which has more computing capacity than the whole of the system being replaced.
For the future, secure jamming-resistant links between UKADGE, airborne early warning aircraft and Tornado F2, links known as the joint tactical information distribution system, JTIDS — we are not short of acronyms in the RAF—are planned for the late 1980s.
The House will be aware of advances in technology which can be used to reduce the detection of aircraft by enemy air defence systems. We are continuing to investigate ways in which this technology—commonly referred to as "stealth" technology—can be applied to RAF aircraft and missiles.
The protection of our key air assets on the ground is of vital importance. A largely NATO-funded hardening programme is being implemented at 11 of our key operational airfields in the United Kingdom to provide protection for our tactical aircraft and other essential operating facilities.

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The first airfield has been completed and the squadrons are operating permanently from the hardened complexes. Work at four other bases is well under way and the programme should be completed by around the end of the decade. The hardening programme at the four RAF airfields in Germany has, of course, already been completed.
At this point I should like to comment briefly on the RAF's budgetary position. I do not, of course, wish to minimise our concern over the difficulties, which I have described to the House, on the Nimrod AEW project, but it must be seen in perspective against the very substantial increases in expenditure that have already been achieved.
When the Government first took office, the defence budget was some £7,500 million. The budget for 1985–86 is over £18,000 million—an increase in real terms of some 22 per cent. During that time, the proportion of the overall budget spent on equipment has risen from 40 per cent. to 46 per cent. — an outstanding achievement, which means that we spend a higher proportion of the budget on equipment than any other NATO country, including the United States.
Over the same period we have spent some £14 billion on air equipment—most of which goes to the RAF—and in the past year alone over £3 billion. Since the Government took office, expenditure on air equipment has risen by over 40 per cent. in real terms. That gives the lie to those who seek to argue that our conventional forces are being in some way neglected by the Government.
Finally, I turn to the RAF's most valuable asset—the men and women in the service. I shall mention first those who serve in the RAF's reserves.
Last year the Royal Auxiliary Air Force celebrated its 60th anniversary. Next year will see the golden jubilee of the Royal Air Force Volunteer Reserve. During recent years those voluntary reserves — the RAuxAF in particular—have expanded considerably.
In the last statement on the Defence Estimates we announced that consideration was being given to further expansion over the rest of the decade. A new Auxiliary RAF Regiment squadron will form in April to operate Skyguard anti-aircraft weapons captured from the Argentine forces during the Falklands campaign.
The new squadron will join the six field squadrons which provide local airfield defence, the three maritime headquarters units which support maritime operations, the movements squadron, and the recently formed aeromedical evacuation squadron. Personnel from the last two units made a valuable contribution to Lionheart last year.
I am pleased to say that recruitment in respect of both the Royal Auxiliary Air Force and the Royal Air Force Volunteer Reserve is most satisfactory and I am most grateful to those who give their time and energy to this invaluable service.
Sir Hector Monro: I am most grateful to the Minister for the praise that he has given to the Royal Auxiliary Air Force and the other reserves. In the defence White Paper, he has given consideration to a flying role for the auxiliaries. Has any progress been made towards that end? They are most efficient and cost-effective.
Mr. Stanley: That is something that we would very much wish to do, being sympathetic in principle, but at present we do not have the resources to devote to it.
Mr. Wilkinson: How is it that the so-called non-flying services, the Navy and the Army, have flying reserve units, whereas the RAF does not?
Mr. Stanley: Each service has to look at the relative priorities that it will give to its assets of manpower and of finance. With regard to the Army, there was the availability of Scout helicopters, as I recall, which made it relatively easy to form a reserve unit for the Army Air Corps. I am afraid that the same is not true in respect of the RAF. The types of helicopters that are likely to be released for a flying role for the Royal Auxiliary Air Force will require a great deal more maintenance from regular people than the aircraft that have been released, for example, to the Army Air Corps. This is something towards which we are very sympathetic but I am afraid that we have a resource problem at the moment.
There are many ways in which I could highlight the personal qualities of those who serve in the RAF as a career. I would suggest that they are personified in the RAF's round-the-clock search and rescue activities. Over the past year the RAF has recorded 949 incidents in the United Kingdom and 121 overseas in which its search and rescue aircraft have been involved. During the past week alone there have been 30 incidents in which Royal Air Force search and rescue forces have reacted; 26 in the United Kingdom and four overseas.
In addition, Royal Air Force mountain rescue teams provide an invaluable service to the community at large, and over the past year there have been well over 200 incidents in which climbers and walkers have been rescued by RAF teams. The House will know the appalling weather conditions and physical hazards which often face the search and rescue teams, who unfailingly respond with skill, determination and personal bravery of the highest order.
I also want to mention the major contribution that the RAF has made to the relief of starvation in Ethiopia. The appalling problems facing that country are compounded by the remoteness of many of the famine areas. Our aircraft have made it possible to deliver vitally needed relief supplies to some of the worse-hit regions.
The RAF has already delivered nearly 8,000 tonnes of food, medical supplies, blankets and other equipment to those in need, and much suffering and many lives must have been saved as a result. I can vouch personally for the consummate skill the RAF has shown in operating in the most demanding conditions — on rough landing strips, with few or no landing aids, and with the ever-present risk of burst tyres and heavy bird strikes. I am glad to say that with the assistance of a number of Army air-despatch personnel our detachment has now started to air-drop food into particularly inaccessible areas where there is a crying need for relief supplies. The speed and efficiency of our operation has deservedly won for the RAF widespread praise from the relief organisations and the Ethiopian Government.
Finally, after the nearly two years now that I have had the great pleasure of working with the Royal Air Force I am left with the abiding impression of a service that is very expert and very dedicated. Its performance in NATO tactical evaluations, in the international bombing competition, in national and international exercises, in search and rescue, in quick reaction alert scrambles, and in maintaining the Falklands airbridge is eloquent and

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visible evidence of the depth of skill and the strength of commitment of the men and women of the RAF. The country is very fortunate to have their service.
6.33 pm
Mr. Kevin McNamara: First, I wish to join the Minister in again expressing the sympathy of the Opposition to the relatives and friends of the RAF bandsmen who died so tragically last week. I have already paid tribute on other occasions to the reputation of that band and to the service which those bandsmen gave to this country. They were great ambassadors.
I wish also to pay tribute to the late Lord Cameron of Balhousie, the former chief of air staff and chief of defence staff, who died last month after a long illness. He was a man who served his country well both in peace and in war and who gave distinguished service to both my right hon. Friend the Member for Leeds, East (Mr. Healey) and Lord Mulley. It would be wrong to suggest that he necessarily approved of their political ideas and aspirations. Nevertheless, he was a devoted servant and in many ways his contribution to the idea that we must depend less and less on the nuclear alternative strikes a chord on this side of the House and, I suspect, on the Conservative Benches as well. He will be sorely missed in the other place.
I join the right hon. Gentleman in the tributes that he paid to the men who serve in the RAF. Like him, I am lost in admiration for the work they have done in Ethiopia. They have undertaken a tremendous mission and they have brought great credit both to their service and to this country. I only regret that it was found necessary to finance part of their operations out of the budget of the Overseas Development Administration. It should, I believe, have come straight from contingency funding. That apart, they have our admiration—as do, indeed, the men who fly the Hercules airbridge. Those of us who have had the privilege of witnessing the servicing and the mid-flight refuelling taking place know the enormous strength, courage and skill that those men have shown.
When a debate on the RAF is slipped into the business of the House at less than 48 hours' notice, one wonders why the Government have chosen to do this, particularly when the debate starts at the end of a great number of very important statements. One wonders about the degree of importance which the Government give to the RAF or the degree of embarrassment which they feel about their treatment of it.
Although we have had a very impressive catalogue from the right hon. Gentleman of the work that is done by the RAF, the projects under way, and the weapons, missiles and aircraft that are coming into service, it is our contention that he has missed and failed to cover the real problems faced by the RAF and the defence needs of this country.
We understand that on the recent budgeting within the RAF there was an estimated overspend of nearly £400 million. That led to such cheeseparing as the 10 per cent. fuel cut, the reduction in pilot training and the reduction in operational flying. The Opposition believe that what we are likely to see over the years is the stretching of programmes, the postponing of programmes and probably the cutting of programmes. This is, as the right hon. Gentleman has said, the most impressive re-equipment of
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the RAF—perhaps the best that has taken place since the Korean war. So far the brunt of the cuts in the services in order to meet the Trident commitments has fallen on the Navy. Now, we believe, we are to see the RAF's capital projects also damaged by that programme and by the whole of our nuclear posture.
While the right hon. Gentleman claims credit for the great sums of money which have been spent on the armed forces, next year there will be a very different picture indeed. The NATO supplement will be disappearing; the special forces inflation factor recognised by the Treasury will be disappearing; there will be a cut in terms of the moneys which will be absolutely available for the armed forces.
The Minister of State said, with a degree of uncharacteristic candour, when speaking in the Navy debate earlier this Session:
"There is one misapprehension under which the right hon. Gentleman is labouring"—
he was referring to the right hon. Member for Plymouth, Devonport (Dr. Owen).
"I should like to draw attention to what my right hon. Friend the Secretary of State said in a letter to the leader of the Liberal party. He was quite clear about the impact of the Trident programme on the Royal Navy's expenditure. He wrote:
'As for the effect on Royal Navy expenditure I would emphasise that individual Service programmes are not considered in isolation from the remainder of the Defence programme.'
It is therefore not correct to envisage the burden of Trident falling exclusively on a limited area which is now perceived to be the naval budget. We take a tri-service view of priorities in the defence budget." — [Official Report, 29 November 1984; Vol. 68, c. 1143.]
If that view of priorities means maintaining concentration upon Trident and our commitment to Trident, the conventional role of the Air Force, as well as that of the Navy and the Army, will suffer.
The Opposition believe that the Government have a choice of either Trident or a credible conventional Army, Navy and Air Force. We do not believe that with the budget that is available we can have both. Nor indeed would we want both. We want to maintain strong conventional forces and to get rid of the Trident nonsense. But, if we are to have an effective Air Force and an effective defence posture, we need a coherent defence policy and an industrial base capable of rational planning into the foreseeable future. We also need to retain the skilled design teams and production workers.
An examination of various sectors of the RAF shows that the Government will not be able to achieve their aim of a coherent defence policy. The Minister has skated quickly and easily over some of the problems of which we are all aware. There is a severe gap in the United Kingdom's air defence network. Our air defence forces consist of between 80 and 90 interceptors, and some of them are very old. If these aircraft are to be brought to bear effectively in a counter-attack on forces from the east, there must be an adequate early-warning capability. Without that, neither the existing force nor the Tornados, which are to come forward, will be a positive and properly effective force. Our sole airborne early-warning capability against low-level attack in the northern sector is upheld by five 30-year-old Shackletons. They are there to protect the nation by giving warning of the approach of a large number of TU22 Backfires and SU24 Fencers, which are all-weather, long-range aircraft. The Shackleton is long overdue for retirement.

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We have the Nimrod programme, but we know that it faces many important problems. The time scale which the Minister presented to the House for bringing the Nimrod into operation was in many ways an over-optimistic one. On 2 February, Jane's said:
"The problems of the Nimrod AEW are massive, deep and interlinked. While a two or three year time scale has been talked of to solve the development problems, this must only be regarded as a 'best guess'. A sudden cure is unlikely to be found".
We believe that we cannot wait for the problems to be solved without some interim measures being taken.
We are aware of the problems. They were highlighted for many in the "Panorama" programme earlier this week and they are well known to those who have been following the Nimrod programme over the past few years. the problems are real and important. For example, we know that the present computer is too small, too slow and overworked. It cannot handle the targets required of it and it cannot distinguish between targets and clutter. Communications are easily jammed and the radar system cannot hold and trap low-flying fast-moving targets, which is the main purpose of the system. In addition, there are serious problems with the airframe. We are told that with the full radar system, crew complement and a full load, the Nimrod undercarriage cannot take the weight and that it might be necessary to refuel in mid-flight. If these facts are correct—
Mr. Robert Atkins: They are not.
Mr. McNamara: The hon. Gentleman says that my information is not correct. He is capable of advancing that argument when he contributes to the debate. However, the comments which I have made have been made repeatedly by others. The Minister who is now responsible for the procurement programme has not felt able, except in the most vague terms, to say that the real problems that are being spoken about will he overcome. He cannot guarantee that the original air staff target will be reached for the Nimrod. That is what we want to hear and that is what we should hear.
Sir Patrick Wall: Does the hon. Gentleman appreciate that it was the Labour Government who introduced Nimrod III, against the advice of many who formed the then Conservative Opposition, who wanted to go into the NATO AWACS programme.
Mr. McNamara: That is an interesting statement. The Minister for Information Technology, who was earlier the Minister responsible for procurement, supported the Nimrod system and said that the AWACS system would be a more expensive alternative. He contended that AWACS was not superior to Nimrod and would not be ready at an early date. That Minister, when in opposition, led the powerful campaign that was mounted by Conservative Members in favour of the Nimrod programme. The official Opposition came down strongly in favour of Nimrod. If anything, it was their power which pushed the then Secretary of State to come to the decision which he eventually took. I am not seeking to make a political point although the hon. Member for Beverley (Sir P. Wall) sought to do so.
We are faced with an important problem in the defence of the United Kingdom. That leads me to the point that the hon. Member for Ruislip-Northwood (Mr. Wilkinson) raised. If we have the problems that I have described—I am glad that the hon. Gentleman and I are ad idem on this
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—we should be considering leasing the AWACS programme from the United States for a period until we solve Nimrod's problems, assuming that we can do so. We may have to decide whether there is an alternative. I understand that it is being suggested by some in the industry that we should put the Nimrod kit into the frame of the European Airbus. They claim that many of Nimrod's problems could thus be overcome. At the same time, the aircraft itself would have a longer lease of life than the existing Nimrod airframes.
The Minister skated over the problems of the European fighter aircraft project. The hon. Member for South Ribble (Mr. Atkins) and I and many others have fought strongly for a sole British Aerospace involvement to meet the RAF's requirement. The Ministry decided in its wisdom that it wanted to go on a European collaborative venture.
We read in today's edition of the Financial Times—Bridget Bloom is a well informed correspondent—that there are two feasibility studies, one from the French and one from the rest. Despite what the Minister has said about the conduct of his right hon. Friend the Secretary of State for Defence, we have been given the impression that the French have been leading us all by the nose. We have been prepared willingly to go along with European collaboration, but the French have been spinning out deliberations on various parts of the project, be it the airframe, the engine or the weight of the aircraft, to try to secure the opportunity to sell and market the Mirage 2000 as much as possible.
That is the real problem, and that is why we are suspicious of the French. I do not blame the French for taking this attitude because they have a good aeroplane and want to sell it. However, we must look after our home base and our other allies.
Mr. Robert Atkins: I agree entirely with the hon. Gentleman. He has talked about feasibility studies and two aeroplanes are being considered. Is he aware that the French option is vastly more expensive, especially its engine, than the EFA programme, which is the other option being considered?
Mr. McNamara: Yes, I am well aware of that. I am glad that the hon. Gentleman has introduced that issue because my speech will now be two minutes shorter. I am able now to discard some of my papers and thus ensure that more right hon. Members are able to participate in the debate.
Rumours are circulating that, if necessary, the British aerospace industry could go it alone and that we could meet the RAF requirement by a project of our own. I would regard that as a dangerous course of action. I believe that when the pressures come on the Ministry and it is forced to make cuts it will find it easier to make them in domestic programmes than to fall foul of our NATO allies. Secondly, the opportunity to go in with our Tornado partners in a European venture, minus the French, will bring economies of scale. The advantage of that will be overwhelming when compared with going it alone. If there is a large market, it is possible to tailor the kit to produce individual aeroplanes, as it were, to meet the needs of individual countries.
We have considerable experience in dealing with our colleagues in the Tornado programme. Collaboration would enable us to have a strong and viable European aircraft industry. There is a danger that there will be moves

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by the United States to gobble up the separate European industries if we have too many go-it-alone projects. The argument for maintaining a European collaborative venture minus the French is overwhelming, so we should disregard any other options.
A matter of some importance to us and to the industry generally is what will happen at Warton if the date for the EFA is pushed back and back. We know that the Tornado is scheduled to end in December 1989 and British Aerospace will need follow-on work immediately if it is to maintain its work force and design teams. If they are broken up, I do not say that we will lose our capacity for the development of high performance fighter aircraft, but it will be far more difficult to maintain and improve that capability. Therefore, it is essential that something be done about it.
The Tornado programme has been stretched and the seventh batch of attrition aircraft is in doubt. Will that batch be supplied to Warton where it is very important to maintain the work force, particularly as the mid-life update has already been cancelled to save money?
There was talk of two major export orders, one to Turkey and the other to the Saudis. We withdrew the export credit on the Turkish order and the Turks could not go ahead. That is surprising, because Turkey is an important NATO partner on a sensitive flank. For the Government to have taken that decision, without consulting our NATO partners to try to reach agreement to help finance the Turks, was regrettable.
What is happening about the Saudi order? Has pressure been brought upon the Government by the United States not to go forward with that order because the planes might be stationed near the Israeli border? Is that why we are not getting it? We know that the French are busily peddling the Mirage 2000 to the Saudis. Our plane would be better able to meet Saudi needs. It is wrong that American or other pressure should prevent a legitimate defence sale. I hope that we shall have more of this type of information later from the Under-Secretary than the Minister of State, with his traditional coyness and disinclination to give information to anybody about anything, was prepared to give us.
No doubt the hon. Member for Yeovil (Mr Ashdown) will be speaking later about helicopters. I am confused by what the Minister said. There is a real need to replace the Puma and the Wessex, which comprise nearly 100 aircraft. The role of the helicopter on the battlefield is becoming increasingly important, as we saw in the Falklands and in Operation Lionheart. In their development of the operational manoeuvre groups the Warsaw pact countries are seeking to develop the use of the helicopter. An early decision must be made in favour of Westland. A collaborative venture has some of the advantages that I spoke about earlier in regard to the European fighter aircraft. Westland cannot afford to wait for a decision. The Under-Secretary should give us more information about the time scale for the feasibility studies. Westland has run out of orders, but before it comes to the EH101 helicopter for the Royal Navy it is likely to face severe cash flow problems if it does not have an order for the RAF.
Then there is the competition from Sikorsky and Aerospatiale. A failure to give an order for the Westland would be as bad as giving an order to foreign competition. If Westland cannot retain its viability in the period leading
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up to the naval order, it may lose its independence, go out of existence or be taken over by someone else. More important, Westland is unique in this country. It is the only competent helicopter firm we have, serving both civil and military users. It is essential in our national interest to keep it in operation. The Government should intervene to ensure positive orders for Westland.
Mr. Best: I respect the hon. Gentleman for his staunch advocacy of a British company. Will he exhibit the same staunch support for the only British contender for the new RAF basic trainer?
Mr. McNamara: I assure the hon. Gentleman that I shall be dealing with that in a few moments because I have a marginal interest in it; 2,000 of the employees live near my constituency.
Mr. Stephen Ross: Taking the Westland case, does the hon. Gentleman appreciate that 1,500 of my constituents work for the British Hovercraft Corporation, which is a Westland subsidiary which does helicopter maintenance work amongst other things? If Westland does not get this order their jobs will be in jeopardy. The unemployment rate in the Isle of Wight is 17·1 per cent. and it would be well over 20 per cent. if that happened.
Mr. McNamara: I hope that the level of 20 per cent. male unemployment will never be reached in the hon. Gentleman's constituency because it would not be pleasant to live with it.
In relation to the sad and sorry story of our basic trainer, if ever there was an example of the Government messing around with British industry, that is it. I shall not dwell long on the fact that they should have gone for a turbo jet rather than a turbo prop because that is water under the bridge. It was a foolish decision. The history of all this is amazing. On 16 March last year, from the original 20 contenders, the Government went down to four. On 18 June they made invitations to tender to British Aerospace, Shorts, Hunting and Westland, with submissions to be in by 18 September. Suddenly, they changed the submission date to 1 October. We all confidently expected a decision by the end of the year. On 11 December the Minister of State for Defence Procurement—incidentally, although we are pleased to see the Minister of State for the Armed Forces, I am surprised that on this occasion the Minister of State for Defence Procurement is not taking part in the debate because RAF debates are often about procurement and procurement policies—
Mr. Stanley: May I point out that my right hon. Friend is on an important overseas ministerial visit to Australia and New Zealand?
Mr. McNamara: I hope that he enjoys the one-day tests, and I hope that we win.
The Minister of State for Defence Procurement promised the House on 11 December that a decision would be made on the matter before the next Question Time, which was to be on 29 January. Then, on 18 December, it was said that there was no clear winner, Hunting and Westland were eliminated and best and final offers were to be sought from British Aerospace and Shorts. On 20 December we had verbal inputs about best and final offers, with the completion date to be 21 January, and then 28 January was mentioned. In late December or early January, suddenly Hunting and Westland were brought back. On 4 January a formal letter requested that best and

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final offers should be received by 24 January and the bids were to be valid until 31 March. Suddenly on 17 January the Ministry of Defence announced that the completion date would be extended to 31 January, not at the request of British Aerospace. On 24 January, the MoD announced that bids would be valid until 30 April, again not at the request of British Aerospace.
We are entitled to ask why we must have that strange time scale, that opening and closing and extension of dates. What contender felt it necessary to go back time and again to the RAF to have the time scale opened up for it? We know that in terms of its handling, stalling, spinning, aerobatics and flying qualities, the PC9 was entirely suitable for the RAF training role. It was highly regarded. Any modifications that might have been needed could have been carried out within the bid price without any problem. However, we know that the other main contender had to go back on three if not four occasions to Boscombe Down for further reappraisal and training. It has had not one but four engine changes. Therefore, we must ask why decisions were made to try to make particular allowance for that aircraft, the Tucano. We must ask why it is still in the field.
The Tucano does not offer as many jobs as the PC9. In terms of foreign sales, it offers nothing compared with the PC9, particularly when Embraer has made arrangements for sales in South America and Egypt. The planes for the middle east market would be built in Egypt.
Why has the Tucano remained in the field? Jobs are very important for the Northern Ireland Office. That is understandable. I appreciate what it is seeking to do. However, where the plane is to be built in Belfast, unemployment is no worse than it is in Humberside and parts of Scotland. In this bid, we have not heard Shorts making any of the promises that it made to the United States about building the Sherpa in parts of Belfast, which it had to do to achieve that order. I should like the Minister to say whether Shorts—
Mr. Roy Beggs: Will the hon. Gentleman give way?
Mr. McNamara: I shall give way in a moment, but the hon. Gentleman is taking up other people's time as well as mine.
I should like the Minister to say whether Shorts has given any undertaking about building the aircraft in the old De Lorean factory in west Belfast, if the company got the order.
Mr. Beggs: Does the hon. Gentleman accept that, in good faith, the Fair Employment Agency accepted Shorts' commitment that in future there would be equal opportunity for all sections of the community to find employment with that company?
Mr. McNamara: I accept that the company said that. We are waiting for the evidence that that will be carried through.
There is also the Foreign Office interest in the matter because of its interest in Brazil. It wants to repay part of the debt that we owe Brazil for its benevolent neutrality during the Falklands war. We understand that. But I suspect that the real reason why Shorts is so interesting to the Government has nothing to do with jobs in Northern Ireland or debts being repaid to the Brazilians. It is purely and simply the ideological reason that the Government
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want to privatise Shorts in the same way as they have already privatised British Aerospace. I say that not only because of my natural suspicion of the Department of Trade and Industry with its present head and its record on privatisation, but because of what was said by the managing director of Shorts, reported in the Prufrock column in the Sunday Times on 10 February, which stated:
"Then, music to the ears of Norman Tebbit at Industry: 'The Tucano will get us into military aircraft work, which we haven't got at the moment. Having some military work will make us a better prospect for privatisation.'"
—said the managing director.
That is what it is all about. That is what Tucano is all about. That is why the RAF might be given an aeroplane with problems with its stalling characteristics, landing characteristics, low-level ride and marginal speed and flying performance. All those things are being sacrificed; and the RAF's interests are being sacrificed to the Government's ideological attitude and the Secretary of State's desire for privatisation. We should not accept that for the RAF. We want the best plane, capable of filling the air staff target in the best way. The only plane that has never had to go back to Boscombe Down for a second, third or fourth re-run, and that has been able to carry through all its training, is the PC9. That is why we expect to have it in the United Kingdom. We want to have it in Brough and Prestwick, and we want the 2,000 jobs over 10 years and the 2,500 other jobs in the industry.
The Minister of State opened the debate in a characteristic manner, glossing over all the difficulties, barely mentioning the problems and suggesting that somehow, with a wave of the magic wand, they will disappear. They will not disappear. They will accumulate. The Government will have to postpone, cut and cancel programmes, not only because the budget for the forces has been overcommitted already, because the Ministry felt that it could spend freely, with the great increases in the budget over the past five years, but, more important, because, as Trident goes ahead, as dollar costs increase and as the pressures increase, the pressures on the RAF and our ability to defend ourselves conventionally will increase. The Government will be condemned by the nation for that.
Several Hon. Members rose—
Mr. Deputy Speaker (Sir Paul Dean): Before I call the next hon. Member, I should like to remind the House that the 10-minute limit on speeches is now in operation. To assist hon. Members, I shall use a little sign language when they are beginning to run out of time.
7.7 pm
Mr. Jerry Wiggin: It is a rare occasion when I can agree with at least two points made by the hon. Member for Kingston upon Hull, North (Mr. McNamara). The first was his comment about the Tornado order to Turkey, with which I heartily agree. I understand that the Turkish defence authorities have never reneged on any arms purchase. It is an extremely important front-line country and a NATO ally, which we should supply with our products.
The other comment that the hon. Gentleman made was that the debate is likely to be substantially about procurement. He may not know that in my constituency Westland Helicopters has its second largest installation, employing about 1,600 people. It is the largest employer

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in my constituency, which has an unemployment rate of about 2 per cent. above the national average, and the highest in the county of Avon.
I should like to refer to the A20, which fills air staff requirement 412. The big criticism that is thrown at that aircraft is that it has never flown. However, I must say to the critics who see that as some sort of a bull point that the Royal Air Force is now capable of making an assessment of an aeroplane that has not flown. In most cases, it has purchased aeroplanes that have not even been beyond the drawing board, let alone tested. With the latest computer technology, that should not be a barrier.
As a result of the retendering process, there has been a substantial change in the status of the A20, the most important point being the offer of the installation of the Garrett engine. I recall being told some horrendous figures about spare parts stocking for the RAF because of the many different types that we still have in operation. One of the advantages of the Garrett engine is that it is already in service in the Jetstream, so, we hope, there will not be a duplicate requirement for many of the spare parts. It is now the fastest and best performing aircraft because of the installation of this high-powered engine. On those two grounds alone, I should have thought that the A20 was very much back in contention.
Mr. John Wilkinson: My hon. Friend will acknowledge that the Royal Air Force Jetstreams are not Jetstream 31s; they are the ordinary Astazon-powered variety.
Mr. Wiggin: I am informed that there is quite a commonality of parts in these Garrett engines. That will be a plus point in relation to the new offer.
The Australians, who are in partnership on this project, have taken this opportunity to reduce substantially their prices. I understand that the price of the A20 is now much more competitive. It may well be, of course, that the competitors have taken the opportunity to cut their prices. I sincerely hope that those factors will weigh with the Government.
British Aerospace and the Shorts contender will be competing for worldwide sales with their partners' less sophisticated aircraft. The A20 will be wholly made within the partnership, and there will be no competition with less sophisticated versions worldwide.
The A20 has the Hawk cockpit and is designed specially to fulfil completely the air staff requirement as written and is not a modified aeroplane. I know that my right hon. Friend the Minister will be bored sick with hearing the various merits of the competitors in this contest. A noble Lord in the other place said that this was the first competitive tender for an RAF aeroplane for 70 years. That seems to be a strange statement, but I cannot think of an example in recent years. This has done the colour brochure printing industry much good, to say nothing of the expensive meals that aircraft manufacturers have found it necessary to give hon. Members. Westland, because of its natural diffidence, has not until now been accustomed, because of its position as a sole supplier, to flying its flag as high as we would wish. I shall send my right hon. Friend the Minister particulars on the A20.
It would be disastrous to believe everything we read in the Sunday newspapers and to assume that Westland is anything other than an extremely prosperous company. It
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is true that the company did not make a profit last year, but neither did many other helicopter companies worldwide. There is a huge surplus of helicopters on the world market — the French are virtually giving them away and the Americans cannot sell theirs. This naturally means that Westland is facing a temporary recession.
I cannot believe that there is a thought going through Ministers' minds that they should not keep Westland Helicopters in business. It is vital that we have our own domestic helicopter producer, not just for employment and technology reasons but for strategic reasons. I was privileged to be in the Ministry of Defence during the Falklands war, and I know the work that was put in at short notice to ensure that the various modifications necessary for operating in that specific circumstance were fulfilled in a way that I do not believe any foreign supplier could have done. I hope that the Department of Trade and Industry and the Ministry of Defence will ensure that there is sufficient work to keep Westland in business.
If the Government are to have a helicopter system between the time when the Wessex and Puma helicopters are phased out and the time when the NH90 comes into operation, they must act. I believe, from my limited observation of the Concorde and the helicopter co-operative programmes, that the concept of four countries co-operating to make a new type of helicopter before the end of this century is unrealistic. The order for the 85 or so W30s that are required will be a huge shot in the arm for Westland. They will be an extremely important acquisition for our services. I cannot believe, when the cost of the W30 is 30 per cent. less than the cost of the American contender and 45 per cent. less than the cost of the French contender, that any Conservative Government could decide other than to go for the W30. I shall not spell out the huge number of jobs that would be involved. Those jobs would be important to my constituency, to the constituency of the hon. Member for Yeovil (Mr. Ashdown) and to the whole of the aviation industry. I hope that my right hon. Friend will soon say that the W30 will move from being an air staff target to being an air staff requirement. I hope that this spring the Government will be firm in what they propose.
I am conscious of the time limit. I should like to go into the arguments about spending on helicopters within the whole of the Ministry of Defence. I believe that the helicopter is a much underrated asset on the modern battlefield and that the Americans have begun to understand that. In the United States there are 14 helicopters for every 1,000 soldiers while in the United Kingdom the figure is 2·7 per thousand. If we had had more helicopters during the Falklands war, the war could have been conducted more efficiently and could have been concluded faster. I well remember the cost of losing the Atlantic Conveyor when the Chinooks went down with her.
My right hon. Friend the Minister includes the Meteorological Office in his responsibilities. I suggest that he should spend a good deal of time seeing what happens in that organisation. Between 1979 and 1985 the cost to the civil aviation industry of meteorological information increased by 225 per cent. It costs £100 to provide the meteorological information necessary for the shuttle to fly between London and Glasgow. For every major aircraft on the United Kingdom register, the airlines have to pay £40,000 a year in meteorological charges. I do not think that I have to persuade the public about the Meteorological

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Office, because when I was responsible for answering for its activities, my assurances that the office was doing a good job were guaranteed to make hon. Members shriek with laughter. It is time something was done about the Meteorological Office. If necessary, we should privatise it, but we should not go on spending £50 million or more a year on it, at vast cost to the British taxpayer who does not trust the stuff that comes out of it.
7.17 pm
Mr. A. E. P. Duffy: The Minister of State said that the RAF is in the middle of a large re-equipment programme. The RAF is undergoing the most extensive modernisation programme for 20 years, involving the expenditure of £14 billion on major projects in the coming decade. I shall examine some of those projects and then, in the light of the emerging technology which some of those projects reflect, assess the possibility of our armed forces, including the Royal Air Force, placing less reliance on nuclear arms.
According to paragraph 4·10 of the 1984 defence statement,
"Later this year, the Tornado F2 will join the RAF and crew training for the operational conversion unit at RAF Coningsby will begin."
In opening the debate a year ago, the former Minister of State for Defence Procurement said that the Tornado F2 would be introduced into service in 1985. I should have liked the Minister of State for the Armed Forces in his opening references to that programme to have been a little more specific. The right hon. Gentleman was more specific on UKADGE, the United Kingdom air defence ground environment. The right hon. Gentleman went on to say that it was being completely replaced, but, along with JTIDS, completion is not expected before the late 1980s. That is disturbing news for hon. Members on both sides of the House.
Three squadrons of Tornado GR1—the strike-attack variant—have now been formed in the United Kingdom, and their introduction into RAF Germany in place of the Buccaneer and Jaguar has begun. Is there any foundation for the suggestion that problems attend the introduction of the GR1 in RAF Germany? The Comptroller and Auditor-General stated in a report in November 1984 that the Tornado collaborative project had
"developed a substantial work-sharing imbalance that was losing Britain defence work worth as much as £250 million."
I should like the Minister to comment on that.
The Minister mentioned the AV8B — GR5, a development of the original Harrier. Its avionics will include equipment, principally a forward-looking infra red, known as FLIR, which will give the aircraft a night attack capability. I understand that the United States and the United Kingdom night attack requirements are similar and that the possibility of a collaborative FLIR programme is under consideration. I think that the House would have liked the Minister to say a word about progress on that.
I understand that two firms—the dynamics group of British Aerospace and GEC Avionics—are competing to supply a FUR system to meet the United Kingdom requirements and that the successful contractor will be selected in 1985. The House is looking to the Minister for comment on that also.
On the survivability of priority one airfields in the United Kingdom and RAF Germany, we are looking for a progress report—preferably tonight. That leads us to
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the Rapier air defence missile system which, as we know from Falklands experience, is indispensable to the survivability of our airfields. Until the tracked Rapier is fully deployed, will not air defence be inadequate?
In the debate a year ago, I questioned whether the ASRAAM programme was safe. The Tornado 2 will enter service with its Skyflash and Sidewinder missiles. In the early 1990s, we plan to replace them with a new generation AMRAAM and ASRAAM, on which we are working with our American and German allies. The Minister will be aware of my fear that the United States will compete for ASRAAM and that it is, in fact, preparing to take over both programmes.
The Minister will recall my concern that the Government should move beyond the stage of studies into air-launched systems or stand-off weapons for Tornado. With the look-down, shoot-down capability of the Soviet air force and its airborne early warning, and given the dramatic modernisation of the Soviet air force—which the Minister a year ago described as Warsaw pact air superiority—Tornado may not be able to get over the target by the late 1980s, but will have to engage it from a distance.
The defence statement of 1983, paragraph 4, claimed that studies were in hand to assess the conventional armed long-range stand-off missile or complementary systems to manned aircraft. Of course, Tornado was in mind. However, there is no mention of that in the 1984 defence statement. I believe that a memorandum of understanding with the United States on two new programmes—the long-range stand-off missile and the short-range anti-radiation missile— are in hand. Again, I look to the Minister to comment on progress.
I understand that on a visit to RAF Finningley in 1979, the Prime Minister pledged that service men's pay would match that of their civilian counterparts. We all endorse the Minister's closing remarks when he paid tribute to the men of the RAF. Therefore, I am bound to ask whether the pay review body is being guided by that principle of parity with civilian counterparts.
There is general consensus in most west European countries that it is desirable to lessen NATO's reliance on nuclear weapons. To assess more adequately how much is enough to reduce reliance on nuclear weapons, it is first necessary to arrive at a consensus on what is meant by the nuclear threshold and what level of nuclear dependence political authorities and publics within the Alliance are prepared to accept.
Of all the various measures for raising the nuclear threshold—that is, for improving conventional defence —one merits special attention because it has received more attention within the Alliance during the past year than any other, and that is sustainability. Lack of adequate sustainability within the NATO forces is, according to Saceur General Rogers, the most serious military deficiency facing the Alliance. NATO guidelines call for 30 days of war stocks — for example, ammunition, petrol and spare parts—all of which apply to the RAF. Yet most countries' war stocks fall well below that level. Therefore, how can any of them claim that they are keeping in touch with public opinion and its increasing sensitivity about the present reliance on nuclear weapons? They are not putting in hand the improvement of conventional forces which would have the effect of raising the nuclear threshold.

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Even conventional improvements would not achieve enhanced security in Europe. Negotiated reductions of conventional forces and the implementation of militarily significant confidence-building measures represent an alternative and complementary method of pursuing enhanced security and conventional stability in Europe.
Arms control considerations are often overlooked in the debate on conventional force improvement, but two forums offer enhanced European security through confidence building and reduction of conventional forces — the conference on disarmament in Europe and the mutual and balanced force reduction negotiations. Reconciling the various and sometimes divergent economic, military and political considerations in the current Alliance discussions on improving conventional deterrence is of paramount importance if the conventional force debate of the 1980s is to be positive rather than divisive—that is, if we are to achieve some success in reducing NATO's reliance on nuclear arms.
7.26 pm
Sir Patrick Wall: I join with the hon. Member for Kingston upon Hull, North (Mr. McNamara) in his complaint about the timing of the debate. It is quite disgraceful to debate each service on one day only per year and then start after three statements and business questions. I want to make a few points about NATO and finish with a constituency point.
The House will know that the Soviet army attacks on a narrow front but in great depth—the first echelon about 50 km behind and the second echelon about 100 to 150 km behind. Currently, the second echelon would have to be attacked by the Tornado, which I believe would mean a high rate of attrition. I believe that the aircraft could be shot down easily.
The most important thing for the RAF is to have a long-range stand-off missile. The Navy has the Sea Eagle, but the RAF has no long-range stand-off missile. As the hon. Member for Sheffield, Attercliffe (Mr. Duffy) said, I understand that a memorandum of understanding has been signed between the United States, the United Kingdom and the Federal Republic of Germany. May we be told the approximate production date? It is most urgent.
In the near future, that task will be undertaken by the multiple launch rocket system phase III, with its terminally guided sub-munitions and its much longer range, by the Copperhead laser-guided shell and by the Assault Breaker that will release the Tornado for its proper job, which is to counter the enemy air forces.
The second most important issue is to destroy the enemy airfields after the first strike has left. That can be done by the JP233, but again that is not stand-off. I do not believe that the three Tornado aircraft coming in and dropping JP233 could survive. In future the cruise missile and possibly a conventional ballistic missile such as the Pershing I, which has been withdrawn, might be used for that purpose. Aircraft are in short supply and should be used for countering the enemy aircraft threat. They must be safeguarded as much as possible when on the ground. The Nunn-Roth amendment led to an increased expenditure on NATO infrastructure—$7·8 billion was allocated recently, among other things, to strengthen
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shelters for the RAF and allied air forces. Since 1951, NATO infrastructure has provided 229 runways in Europe, which is a very good record.
We have already discussed Nimrod III compared with AWACS. I admit that many Conservative Members wanted Nimrod III, although many others advocated the NATO AWACS. This is a lesson for us. These international projects are sometimes much more expensive, but they are brought to fruition at a reasonable cost, are difficult to cancel, and do not give rise to the cost escalation that is bound to arise with Nimrod III.
Another means of detecting enemy aircraft is NIS-NATO identification system — which in my day was known as IFF. For years different air forces have had different identification systems. It has been said time and again that RAF aircraft could be shot down by our allies unless we had a common standard. I understand that the United Kingdom, France and Germany have agreed on a common system, but that the Americans are advocating another. I hope that these systems will be standardised, because it is not much good having two systems in the Alliance.
As to the European fighter, I merely remind the House that the Americans are at the same time developing their own advanced tactical fighter. It is a different type and has a longer range, and I do not believe that the European fighter will have much chance of success unless there is some arrangement with the Americans on comparability, common sales and so on. ASRAAM and AMRAAM have also been mentioned. Both are currently in difficulty. The European contribution, ASRAAM, has been held up twice by Germany's failure to produce the cash on time, although I now gather that it is again on line. This time the American AMRAAM has gone wrong and it is being examined by the Secretary of State.
I remind the Government that Ford aircraft in America are going ahead with the AIM9M, which it hopes will take the place of both ASRAAM and AMRAAM if they go wrong. Therefore, we had better look to our laurels.
SDI is purely a research project, but it will cost $26 billion. It is non-nuclear defence. If it succeeds, it is expected to bring down all ballistic missiles, including the SS20, SS21, SS22 and SS24 — the shorter-range battlefield weapons. SDI intercepts at the boost stage before the decoys are deployed and when it can home in on the heat. It also intercepts at the mid phase and at the terminal phase. I stress again that it is non-nuclear—
Mr. McNamara rose—
Sir Patrick Wall: I would rather not give way as I am short of time.
SDI depends largely on laser particle beams and kinetic energy, some of the lasers being reflected by mirrors. It also depends on very high speed integrated circuits—the most modern computer technology.
Are we keeping up to date with this research? The Prime Minister mentioned this in Washington only yesterday, but I should like to know whether we are keeping up to date with the computer technology which is an essential part, not only of SDI but of all advanced technology affecting the RAF.
The PC-9 will be built largely in my constituency. It is favoured by the RAF—at least that is what we are given to understand. I also understand that 85 per cent. of the aeroplane will be built in this country as well as 75 per

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cent. of the equipment—the most valuable part of any aircraft. There are joint marketing arrangements with the Swiss and, most important, this is a package with the Hawk. If countries buy the PC-9, they will buy the Hawk. I am pretty certain that the Swiss will buy the Hawk if we choose the PC-9.
Mr. Richard Hickmet: Does my hon. Friend agree that the decision to purchase the new trainer should be based on what the RAF believes best meets its purposes, not on employment considerations or the desirability or otherwise of floating a company on the market?
Sir Patrick Wall: I agree with my hon. Friend. I remind the House that Shorts has just won a lucrative aircraft contract which will keep it pretty well occupied for some time, and that Humberside and the Prestwick area of Scotland could benefit by about 2,000 jobs if we were to order the PC-9. I commend to the Government early-day motion 217 which has been signed by more than 100 hon. Members. I very much hope that our choice will be the best aircraft, the one which the RAF wants.
I do not expect the Minister to answer any of my latter points, but I should like him to reply to my comments on NATO, IFF, and long-range stand-off missiles, which will be vital in any battlefield of the future.
7.35 pm
Mr. Paddy Ashdown: The hon. Member for Beverley (Sir P. Wall) tempts me to discuss the SDI and the broader questions that are now before us. However, I hope that hon. Members will forgive me if, in view of the time, I concentrate on one issue—Westland, which is of special interest to my constituency.
I should declare an interest, apart from my constituency interest, in that my only shareholding in British industry is in Westland. It is a modest sum of £20 which enables me to attend the annual general meeting. It is certainly no speculative, profit-making deal.
I wish to concentrate my remarks on the AST404, the replacement for the Wessex and Puma helicopters. The AST404 was originally due in 1987–88, but the in-service date has now been extended to 1991. Recently, it may even have been put on the back burner—the so-called regulator—with no funds yet identified. That causes concern.
The RAF's need for a replacement for the Wessex fleet is unquestionable and urgent. About that there can be no doubt. The Wessex fleet now supports our troops in Northern Ireland, but in time of war would be used to support our forces on the central front. These aircraft are 26 years old, and were designed in the 1950s. I was disturbed when the Minister said that perhaps this aircraft would be run on to the NH90, because the hon. Member for Weston-super-Mare (Mr. Wiggin) rightly identified the fact that these collaborative projects almost never meet their targeted in-service delivery date. The Minister may talk about 1994 or 1995, but he knows as well as I do that the NH90 will probably not become available until the year 2000. Are the Government really asking the RAF to use aircraft — the main element of its fleet — whose design is 50 years old? We have good reason to wonder how long an essential component of our defence can depend on these clapped-out machines. They are good machines for their age, which have done sterling service
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in their time. I have had good reason to know that, having flown to and from active service in them in Borneo, Aden and Belfast. However, these machines need replacing soon —indeed, now.
As other hon. Members have said, the helocopter's role in the battlefield is that of a force multiplier. It should be used to make better use of our forces. That is vital and is well recognised elsewhere. If there is an imbalance with the disposition of Soviet forces in central Europe, which I accept, we can overcome that through the use of helicopters.
As the hon. Member for Weston-super-Mare also said, other nations seem to be much more aware of this than the Ministry of Defence. A typical American corps in central Europe will have 800 helicopters at its disposal, whereas a typical United Kingdom corps will have 180. All defence experts now recognise the increased and growing role of the helicopter in the battlefield. To meet that requirement, the Government have set up air staff target 404. There are three contenders, but only one is British—the Westland W-30. The W-30 meets in full, admittedly with no frills or fur trimming, the precise requirements laid down by the RAF. Unlike other competitors, the W-30 is designed to meet the need fully but not excessively. That is why it seems that the costs will be about 30 per cent. lower than those of foreign opposition. Running costs will also be lower.
We have made a considerable investment in the W-30, which is the derivative from which Westland will build its aircraft. The Department of Trade and Industry has invested £40 million in it, and Westland has done an almost pound-for-pound matching investment of about £35 million. There have been further investments in the blades and gearboxes. My community and that of the hon. Member for Weston-super-Mare have also invested their ingenuity and skill in that aircraft. That stands at stake on the Government's decision.
Considerable opportunities also stand at stake. Exports may be more than double our sales to the RAF. If the RAF's imprimatur is on the aircraft and we can say to other countries that the British Government have bought the aircraft, we may be able to sell twice as many as we would supply to the RAF. That would give us a prime position in the European collaborative deal, the NH90.
Westland is a committed collaborator, as the EH101 shows. The W-30 would provide 6,800 man years work, which is about 1,000 jobs in production, 400 in support, and a further 2,000 in the other British industries that supply Westland. A typical helicopter today is only 50 per cent. in house, and the other 50 per cent. is bought in from other industries all over Britain. Therefore, there would be about 4,000 jobs overall. We would maintain a major British defence industry in a strong condition. We would maintain a stand-alone capacity to make our own helicopters. We would also maintain in the best condition a firm which is about to produce a key new helicopter, the EH101. There is a necessity to build a bridge from the present position to the EH101 in the early 1990s.
I recognise the Secretary of State's problems, as all hon. Members must do. They may be generated by Trident. We recognise that he now faces a matrix of difficult decisions. I remember calling Trident "that cuckoo in the nest", and he is now undoubtedly finding good reasons to elbow other projects out of its way. I do not wish to make a political point about this, but Trident

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creates difficulties for him. We recognise how he will be tempted to delay decisions to a future date when he will have more room for manoeuvre.
However, I caution the Minister, in case he considers delay a mechanism for solving his problems, that the consequences are severe. The RAF needs will remain unmet in the key area of our defence. That will inevitably push the replacement helicopter into a position where it clashes with other capital programmes. Delay will weaken our capacity for export from Westland and other British industries. Westland will not have the bridge to secure itself a future position. It will be tied into the NH90 collaborative helicopter in a weaker position than would otherwise be the case.
If the Secretary of State cannot commit himself to a date, we shall be disappointed, although we shall understand why. If only he would commit the Government to choosing the W-30 on principle, we can, perhaps, live with uncertainty about the date, because we shall at least have one foot on the ground and something that we can use to encourage exports. With that, Westland's hand will be strengthened for exports.
The Secretary of State realises that he is dealing, not with a weak company, but with one whose work force and management have shown themselves capable of taking courageous and tough decisions to enable them to survive in an increasingly competitive market place. The Secretary of State is dealing not with an ailing industrial sector, but with a world sector with an assured growth for the future. He is not dealing with a company that has no future orders. On the contrary, the company has an assured future in the EH101, which is the greatest single helicopter project in which the company has taken part. He is dealing not with a company that cannot supply the essential needs of the RAF less expensively than others, but with a company which can supply a British buy from a proven record. We know from the experience in the Falklands that it can supply the goods—and, in this case, supply them at a cost 30 per cent. less than its competitors.
In asking the Minister for a decision now or soon, Westland is not seeking charity. It has no need of that. It does not want gifts or handouts. It wants the Government to make a decision so that it can plan its future, get on with the job, and do the thing that it knows best—building the best helicopters in the world for the RAF's needs.
7.44 pm
Mr. Robert Atkins: There is a lot that I want to get through and in view of the time limit, I hope that I do not gabble too much. I agree entirely with the hon. Member for Kingston upon Hull, North (Mr. McNamara) and my hon. Friend the Member for Weston-super-Mare (Mr. Wiggin) about the sale of Tornados to Turkey. We are talking about £1 billion of export orders. I thought that Farnborough existed to deal with our defence sales among other matters. I can do no better than to quote from a letter I sent to the Prime Minister. I said:
"As you have indicated on many occasions, the British aerospace industry is a shining example to the rest of the country in its design, production, marketing, delivery, profits, workforce and general management. Is it to suffer at the hands of the Governments of France, U.S.A., and others, in that they bend over backwards to support their aerospace industry in competitive foreign sales, or can they be assured of the necessary financial assistance equivalent to the predatory financing being
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offered elsewhere? Is it to lose out to the Mirage 2000 taking up sales which should be Tornados or E.F. A.'s or even a national version of a new fighter, breaking up design teams and the backs of many sub-contractors, or can the situation be retrieved as a matter of urgency?"
Hon. Members will not be surprised to learn that I want to talk largely about the European fighter aircraft. It has been the subject of a continuing saga under various mnemonics and titles since I was elected in 1979. There will soon be a meeting — it causes me and my constituents some anxiety — to discuss the feasibility plan, development and production of the EFA for 1985 onwards. I was sufficiently worried about it to raise the matter with the Secretary of State in the House. He recently wrote me a letter and confirmed that there may have been
"a slippage of perhaps 4 weeks on the timescale we had in mind last summer. We realise however that a further period will be needed for officials to assess the results of the studies, for the Air Staffs to consider the capability offered, for National Armaments Directors to prepare the ground for a Ministerial Meeting and for us to take a view on the military, financial and industrial aspects."
As I predicted, and said earlier in an intervention, France is at the nub of the argument. A French industry spokesman said:
"It is important to join forces with the UK, not because of the physics but because of the money required for development." However, Emile Blanc, the national French armaments director said:
"We are taking steps to ensure that France controls technology in areas where we lead other nations."
I have a document from the company, for whom I seek to speak because of my constituency interest. It states:
"British aerospace industries would prefer a national solution to the new fighter requirement."
The company believes that it will be at no extra cost to the percentage of the United Kingdom collaboration, which is proposed within EFA because of the great cost of the French aviation industry, to which I also referred in an intervention. The document states:
"British aerospace industries would prefer a national solution to the new fighter requirement for the RAF in view of the greater opportunity to utilise the industries resources and technology, as developed by the EAP with the substantial industrial involvement in that programme.
However, they recognise the value of a major collaborative programme with the enlarged overall programme and long term stability which would ensue, and consequently have co-operated fully in the five nation feasibility study for the EFA which has just been submitted to the five Governments.
In any programme which hopefully will follow on from these studies they would expect the following aspects to be respected by HMG to safeguard the UK national position and the continuing viability of the aerospace industry.

1. The weapon system resulting from the programme must meet the minimum operational target of the RAF.

2. There must be equality of worksharing with GE and FR during the development phase, recognising that subsequent adjustments can be made in production to reflect the numbers of aircraft bought by each nation.

3. Workshare arrangements should apply separately to airframe, engine, and equipments.

4. There should be equality of management authority and responsibility between the five nations with no overt leadership by one nation for either airframe or engine.

5. A central NATO agency should be established with authority to place contract on the industries.

6. To ensure maximum penetration of the export market it is necessary to get aircraft into service as soon as possible and no later than January 1995."

Anything that does not meet those criteria will be wholly unacceptable to the company, management and work force, to the British aerospace industry and to those

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of my constituents who work in it. It will also be wholly unacceptable to me. I make my position quite clear. I can do no better than to quote from some of the recent remarks made about this project in various trade journals. For example, the national aerospace organiser for TASS says:
"We don't seem to know what we are doing or where we are going; that's bad for Britain's defence. Tass is concerned that the UK will come out 'the worst' from any negotiations because there appears to be an absence of policy as to what we want". The editorial in Flight International, the United Kingdom magazine on aviation, says:
"Neither German nor British governments have shown a willingness to put even their own nation's interest first, and departmental pride is allowed to inhibit possible spending… France has also taken an export-led stance, and geared the development of new aircraft to the potential export market, without allowing that consideration to govern France's own military requirements."
Dornier and Northrop are continuing to work on the ND-102 project as a fall-back position, because, as the vice-president and chief designer of Northrop said:
"We think there is enough chance [that the EFA program will fail] that we want to continue to be prepared for the opportunity if it comes."
Aviation Week and Space Technology, the leading American magazine, says:
"U.S. government officials contemplating the difficulties are convinced the entire program will never get off the ground. The skeptics at this point have a reasonable bet."
That shows the concern that has been expressed about the EFA project. The importance of the project cannot be underestimated. I know what the former Minister of State for Defence Procurement did, what my hon. Friend the Minister is doing—as he has a constituency interest—and, above all, what the Secretary of State is doing. but the industry's perception is that the French are outmanoeuvring us. They have indicated that Dassault wants 46 per cent. of the airframe. People at all levels of industry tell me that the French are getting away with murder. I am not prepared to tolerate it any longer. I am fed up with urging the project and with apparently not getting very far. The Government and the industry together must get a grip to ensure that that plane gets off the ground. If we cannot get a collaborative project, which is what we all want, we must have a national project.
The situation in relation to jobs, technical expertise, the world leadership on offer within the British aerospace industries, and in relation to the strategic and industrial requirements demands that that project goes ahead now. It must not be delayed any longer. I, the Royal Air Force, hon. Members generally and, above all, the British aerospace industry, including my constituents, demand that it should happen now. I hope that the Government and the House will recognise the urgency of the project.
7.52 pm
Mr. Lewis Carter-Jones: I shall return later to the challenging points made by the hon. Member for South Ribble (Mr. Atkins), as I agreed with everything that he said. I do not always agree with him, but on this occasion I agreed with him in toto.
The Minister made some very unfortunate remarks in his opening statement. He referred to Phantoms bought from the United States, modified Hawks, updated Buccaneers, stretched aircraft., reborne Shackletons and reincarnated Jet Provosts. In many ways he reminded me of Ron Moody when he appeared in the film musical of "Oliver Twist". Even though I am a Welshman, I shall not sing, but the phrase that I have in mind is:
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"We are reviewing the situation".
That is about all that the Government do. If reviews were aircraft, the RAF would be well off. But, in effect, the Department sits back and fails to make any decisions. If the hon. Member for Dumfries (Sir H. Monro) had been in the Chamber I think that he would have agreed with my next point. After all, I wonder what would have happened if Mitchell had not built the Spitfire or its prototype for the Schneider trophy, possibly even before the Minister was born. We did not have enough Spitfires in 1939, but at least we had them. In 1995 will there be any aircraft, or will there be just another review?
I should be delighted to see the Secretary of State in a flak jacket standing by an advanced fighter ready for 1995. But I believe that we are standing in the shadow of Trident. It is influencing events and preventing decisions from being made. I need not rehearse the points made by the hon. Member for South Ribble, because he spoke well on behalf of his constituents and the industry. I commend him on that and I agree with everything that he said. It is about time that the Department made a decision.
There was an interesting development this week. Some hon. Members will know that I have been fighting a battle to get the Super 748 over to the Caribbean. But I believe that that decision was bedevilled by a Frenchman, who was a Commissioner. I had a fascinating reply from the Prime Minister this week, indicating that she intends to find out exactly what went wrong with that deal. The 10 nations wanted it, the airline wanted it, the bank wanted it but the French said no.
As the hon. Member for South Ribble has said, it is about time the French were told that they should either be a partner, and an equal partner at that, or should let us go alone. This is no time for being mealy-mouthed, and there is no point in dressing up and being photographed. This is the time for action. The French must be told that if they want the European fighter, they must collaborate on a fair basis, with the Brits being allowed to maintain their technology and work force as well.
Let us consider this renovated Jet Provost, Pilatus or Tucano. Why do we not return to the simple concept of letting the RAF choose its own aircraft? It is the RAF that flies them, and not the Minister or the Secretary of State. The RAF knows its requirements. When I was in the RAF, I was given a very good aircraft. I was very grateful to the manufacturers. I had a Mosquito, the best 'plane of its day. The Secretary of State has a duty to ensure that the skilled members of the RAF have the best aircraft available for training as well as operational purposes. That is his prime duty. There should be no more reviews, dilly-dallying or finger trouble. I am reminded of old Pilot Officer Prune who was given an award for failing to do things on time. He was awarded the Highly Derogatory Order of the Irremovable Finger. The Minister must ensure that he is not given that order. I shall certainly present him with it, if he does not make the right decision. I am sure that hon. Members will associate themselves with my comments.
I turn to Woodford and to the importance of maintaining a skilled work force. It is the last place in the United Kingdom where a large-scale military aircraft can be built. There is no point in the Secretary of State using one of his favourite terms—"It's front loading." That is rubbish. If we are to sustain a large aircraft building capability, Woodford must be supported.
I shall obtain favour all round tonight, because I now turn to the subject of helicopters. It must be the W-30. We

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must maintain the helicopter capability in this country. It is sometimes assumed that the west country is an area of full employment, but is not. The work force can build the aircraft or helicopter that is desired, and that will at the same time provide employment, and sustain and maintain the technology that we need in this country.
The Minister spoke about the search and rescue scheme, but there is something else that the RAF could do with its helicopters. It could involve itself more and more in perinatal care and in the new-born baby. The RAF could help to take babies to special units quickly. That is humane work and requires skilled training.
I have been speaking of conventional defence. Some of the delays have been occasioned by the awesome burden of Trident. I believe that implicitly.
The Minister must ensure that the RAF gets its preferred aircraft. The overwhelming need is to sustain British technology in the aircraft industry. The Minister must preserve the skills and initiatives of the work force. No more reviews. Action, please.
8.1 pm
Mr. John Wilkinson: In many ways the debate has been untypical. Usually in debates on the Royal Air Force we discuss the depth of pile in the carpets at RAF Germany and whether English programmes are shown on television there. Constituency preoccupations have not dominated this debate. That is to the good.
My right hon. Friend the Minister of State set the right tone when he concentrated on the operational capabilities of the 'service and its equipment. I want to take the debate into the future—into the next century and beyond. This is the appropriate time to do so.
This month two leading representatives of our European Alliance have spoken about the significance of President Reagan's strategic defence initiative, launched in his famous speech on 23 March 1983. Chancellor Kohl in his Wehrkunde speech at Munich and our Prime Minister in her speech yesterday to both Houses of Congress welcomed the idea of European industry participating in the research programme.
I should like to examine how the strategic defence initiative and the new technologies for the military utilisation of space will affect RAF strategies, its order of battle, procurement policy and manpower planning. The most important element concerns the men and women of the RAF.
Lord Trenchard was one of the greatest men of our century in terms of the work that he did towards the creation of an independent Royal Air Force and for building a structure which would endure. That structure endured through the second world war and proved itself in that conflict. Basically it endured until the late 1950s and early 1960s. In the 1950s the flying squadrons of the Royal Auxiliary Air Force were disbanded and in the 1960s changes were made in the training of officers. They were profound alterations from the old Trenchardian mould.
For the next century we must attract people who will be capable of servicing and manning the space-based systems that will ensure our deterrents, and our defence. For that we need a new tri-service cadet college to train people in the appropriate military sciences. I have always
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said that the place to do so should be at Greenwich and that when cadets have completed their training there they should go on to their respective academies and that for the Air Force it should be Cranwell. At present Cranwell courses are short and not appropriate to the future scientific and professional training required. The United States Air Force academy has a course lasting four years and is of the highest calibre.
I do not wish to decry the role of graduates from our universities and colleges. They will continue to be essential, but we need a new, highly professional, properly trained stream of permanent commissioned entrants.
In mid-career we must enhance the role of the college of air warfare at Cranwell. It already provides an astronautics course. We should carry it further so that the course ultimately involves space experience. We should approach the task in co-operation with our European allies.
We and our European allies must co-ordinate our whole approach to the strategic defence initiative. My right hon. Friend the Secretary of State has shown the way forward in his industrial approach. We must resolve our military role. First, we shall have to deploy in Europe point defence systems against ballistic missile attack. There is nothing new in the concept of protecting from pre-emptive or first strike our own deterrent forces and our centres of population. We did it in the 1950s and 1960s when Fighter Command protected the bomber bases of the V force. The point defence systems will be the easiest component of the SDI to evolve and I believe that they will be the first to be deployed.
More futuristic elements are involved also. I refer to the means of intercepting ballistic missiles in their boost, post-boost and mid-course elements of flight. Those aspects of SDI will require space-based systems. Some could be manned, but certainly they will have to be serviced and maintained. The shuttle has shown that this is possible. It is already possible to retrieve, maintain and repair satellites in space. The Royal Air Force and its personnel will have a role in that.
We must examine too how we are to deny to a potential enemy the eyes and the ears that control military operations. Increasingly those eyes and ears are satellites. The Soviets have already deployed a rudimentary first generation anti-satellite system. They are keen that the United States should not fully develop and deploy their own anti-satellite system. I have no doubt that the Americans will pursue its development—and they will be right to do so. I hope that the system will be operational shortly with the F-15.
The ability to intercept and destroy satellites will not be unique to the American component of our Alliance. We Europeans will have a similar requirement. I hope that the air staffs of our respective countries are addressing themselves to the problem already. I believe that the Tornado F-2 and, ultimately, the European fighter aircraft will be the appropriate launch vehicles for such a system. Command and control operations will also be required. That will be costly and is another matter which must be addressed.
We have dealt with today's problems, the problems of the 1980s and we have looked to the 1990s. There is no doubt that in the next century the RAF will have a spatial role. I hope that is so. The motto of the service is not "per ardua ad caelum" but "per ardua ad astra". In that spirit I hope that the Secretary of State and his colleagues will

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encourage the Service and Civil Service to examine the changes required within the RAF to meet the challenges of the space age.
I hope that the strategic defence initiative, which has undoubtedly brought the Soviets to the negotiating table again and which offers some hope that the pattern of mutually assured destruction will be broken, will mean that there will be greater security for our peoples. I trust that we shall play our full part in this process and that the RAF will play a leading role.
8.9 pm
Mr. William McKelvey: As the hon. Member for Ruislip-Northwood (Mr. Wilkinson) said, this is a strange debate in some ways as hon. Members with such diverse views as the hon. Member for Beverley (Sir P. Wall) and my hon. Friend the Member for Eccles (Mr. Carter-Jones) apparently agree and almost feel mutual admiration. I hope that the Minister is aware of the pressures that might be being applied.
I shall confine my speech to the urgent need to provide the RAF with a new trainer. I trust that the Minister was not being serious when he suggested the refurbishment of the present trainer as a credible alternative. I hope that the laughter that went around the Chamber when he said that was not nervous laughter, but a sign that the House has discounted such an alternative.
I speak on behalf of all hon. Members from Ayrshire, except the Secretary of State for Scotland, when I say that there is only one aircraft that should be the replacement for the trainer—the British Aerospace PC9. In a debate such as this, there is a danger of overstating the case, so I shall not go into detail about its technical qualities. I do not wish to denigrate other aircraft as, in their way, they are all first-rate, but the PC9 shines out like a throughbred.
An important feature of the PC9 is that it meets all of the RAF's requirements. The Minister and others have paid respect to the skill of the RAF. They should seriously consider giving the RAF the airplane aeroplane that it wants. The PC9 can meet the required specifications with minimal changes whereas its competitors are apparently having some difficulty. Why are there delays? Some of us suspect that the PC9's competitors are being given extra time to reach the specifications required.
Moreover, the PC9 is the best industrial solution. Several hon. Members have spoken of the influence on their constituency if the PC9 were chosen. I have a constituency interest in it. Although Prestwick is not in my constituency—it is 11 miles away in the constituency of the Secretary of State for Scotland — engineers and aircraft fitters based at Prestwick live throughout Ayrshire. In the initial stages, the PC9 can provide 150 jobs where the average rate of male unemployment is about 22 per cent. That number could be extended to 250. That is important to an area that has just lost a British Steel Corporation foundry with the loss of 280 jobs.
Despite the claims of its competitors, the PC9's airframe is 85 per cent. British and I understand that about 90 per cent. of the technical equipment is British. The Minister must consider all of the factors which make up the equation, but the RAF has said that it wants the PC9, it will provide about 2,400 jobs for British industry, it is almost wholly British-built and it would provide jobs throughout the United Kingdom. The best craftsmen in the world will be employed in building it. I would be astonished if the PC9 was not chosen.
8.16 pm
Lord James Douglas-Hamilton: I agree with everything that the hon. Member for Kilmarnock and Loudoun (Mr. McKelvey) said about the PC9. It might surprise him that my constituents have an interest in it as Ferranti is involved.
It would be churlish if I did not say that I spoke in the House last year arguing that Ferranti should get a contract for the GR5 Harrier. In the past few days, my right hon. Friend the Minister has awarded that contract. The significance of it is the relationship with the European fighter — because Ferranti will now be in a much stronger position to compete for the avionics of that fighter. Recognition of the work of Ferranti as a world leader has been enormously strengthened by my right hon. Friend's decision, for which I thank him very much.
My right hon. Friend the Minister said that he hoped that collaboration will succeed, but there are serious potential difficulties with France. I understand that the British aerospace industries want a partnership that involves equality of work-sharing and of management authority. During discussions, France might prove to be less genuinely interested in that policy than us. I appreciate that Minister Hernu might do his best to deliver, but the power of the French industrial and trade union lobbies, especially in regard to the Dassault company, are so powerful that the French will be unlikely to accept a genuine partnership.
I hope that my right hon. Friend is right to think that collaboration will succeed but, in the event of it being difficult to get a genuine partnership, I hope that he will have readily available an alternative policy and plan for a national solution to preserve the structure and capability of the British aerospace industry. "Jane's All the World's Aircraft 1984–85" said recently of the European fighter:
"With the first flight scheduled for the far future of 1990–91, there are many people, notably in the USA, who expect it to be abandoned long before then, in the case of five-nation failure to compromise."
I applaud my right hon. Friend's will to make it succeed but I hope that he will be prepared if the worst comes to the worst.
On the PC9, the argument advanced earlier that the view of the Royal Air Force should prevail carries weight. The employment arguments are relatively evenly balanced, although we look forward to hearing the arguments to be put forward by hon. Members from Northern Ireland. Obviously it would lead to more employment in Northern Ireland but by the same token it would probably lead, over the years, to less employment in British Aerospace.
I believe that what the RAF want is the argument which should carry most weight, but I do not wish to conceal from the House that I have an interest in the matter. In the past I have, as an author, written about Prestwick. Moreover, when my father was a Member of Parliament for a Scottish constituency he helped to found Prestwick and the Scottish aviation industry. It began as a very modest project. However, after a series of mergers it became the Scottish division of British Aerospace.
As it nears its 40th anniversary I hope the House will forgive me if I say that there could be no stronger recognition of and encouragement to the work force at Prestwick than if Prestwick obtained this order. It would reinforce the belief of the work force that it has a continuing and permanent contribution to make to the

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industry as the headquarters of the Scottish aviation industry, and that is no more than the RAF deserves and desires.
Finally, I wish to refer to the restoration of the flying role of the auxiliary air force. It could have either a search and rescue role, or a training capacity or be used as reinforcement. It would be very good for morale if those who have served for many years in the Royal Air Force, who have developed considerable expertise and who wish to retain a connection with the RAF could play such a role in the auxiliary air force. As and when economic circumstances permit, I hope that the Minister will accede to that request.
Mr. Deputy Speaker: Owing to the splendid co-operation of hon. Members, there is no longer any need for me to enforce the 10-minute limit upon speeches. Nevertheless, I still appeal for brief contributions.
8.21 pm
Mr. Roy Beggs: May I place on record the admiration and appreciation of the Ulster Unionists for the excellent service given by the men and women of the Royal Air Force, both nationally and internationally. The Ulster Unionists believe that the RAF should be provided with the best basic trainer that is available for training its pilots. The Government are aware of the importance of job creation and we would be pleased if such a project were to come to Northern Ireland. I recognise that a very fine balance has to be drawn and that there is an equal need for jobs to be created at the Shorts factory in Belfast and on the mainland. However, such a decision must not be made simply on social grounds. If that were the case, I believe that Northern Ireland would outstrip all contenders. Unemployment in Northern Ireland stands at 21 per cent., with 50 per cent. male unemployment in some areas.
My duty as the Ulster Unionist spokesman on trade and industry is to draw to the attention of the House what I believe to be a scandalous attempt by British Aerospace to force the so-called merits of its aircraft upon all and sundry, not only by means of an expensive and continuous campaign in the national press but also by means of an organised invasion of this House through The House Magazine.
Mr. Stephen Ross: I cannot allow that remark to pass unnoticed. I wrote to the chairman of Shorts congratulating him upon his campaign. I even received a Christmas card from him with a Tucano on it. I think that the Shorts campaign has been magnificent.
Mr. Beggs: I thank the hon. Gentleman for such a tribute. However, those hon. Members who have listened to the whole debate will probably have come to the conclusion that I am the lone ranger in this exercise. The strength of the case presented by Shorts has contributed to the recognition paid to it by English, Scottish and Welsh hon. Members who support the Shorts motion. I question whether it is right that a company which is 48 per cent. funded by the public should spend such vast sums of money upon advertisements in the national press.
Those who live in Northern Ireland know only too well the true value of money. We should prefer to pitch performance and price against publicity and pressure. We do not believe that ideological considerations should
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prevail when a decision is finally made. However, on performance and price we are prepared to accept the outcome. I believe that the methods used by British Aerospace in its efforts to win this contract are quite obnoxious. An attempt has been made to misrepresent the qualities of other aircraft. Unfortunately some, though not all, hon. Members have swallowed some of the information that has been peddled. However, I am confident that such unworthy tactics will not influence right hon. and hon. Members and that they will not be fooled.
Mr. McKelvey: The hon. Gentleman's remarks about British Aerospace are not true. If I had to condemn the management of British Aerospace I should say that it has lagged sadly behind Shorts, vis-à-vis Shorts' Tucano. There has been consistent and persistent lobbying from the trade union movement.
Mr. Beggs: I thank the hon. Gentleman for his intervention. It is quite right and proper that on behalf of their members in British Aerospace factories the trade unions should make representations to those hon. Members who represent constituency interests. However, I am in a unique position. I do not have a constituency interest to put forward. When we apply the rather scarce commodity, truth, to the debate we find out why the advertising campaign by British Aerospace is necessary. In the best and final offer stage, Short Brothers produced a package which shines through the smokescreen thrown up by British Aerospace.
Mr. A. Cecil Walker: My hon. Friend has referred to a smokescreen. Could that be due in part to the fact that the new Garrett engine that is expected to be fitted to the Tucano is equal, if not better in terms of speed and rate of climb, to the PC9?
Mr. Beggs: I thank my hon. Friend for his intervention, but since we are discussing truth I do not intend to exaggerate. All I would say is that the Shorts Tucano has always met the requirements of the Royal Air Force, even when it appeared that the specifications had been increased. Indeed, the Garrett engine performs in every sense up to the level of the PC9. I said that I would not boast but the facts are there for all those who are responsible for examining the details to see. However, when the running costs are considered, the Shorts Tucano has cheaper running costs than its main rival. The life cycle costs of the Tucano are substantially lower than those of the PC9. There is a further bonus in the fact that spares for the Tucano are much cheaper than those for its main rival.
Claims that only one aircraft fully meets the RAF performance requirements for its new basic trainer are simply not true; nor is the suggestion that employment created by the PC9 will be greater than that created by its competitors. As for the claims for a perfect marriage between the Hawk and the PC9, I believe that hon. Members and the British taxpayer will be more influenced by and interested in the facts than in such speculative romance.
Almost everyone is agreed about the need for a new basic trainer, and the decision will be taken by the Ministry of Defence on the basis of the facts as they are known by the Ministry, without any element of favour.

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The reaching of a decision is not assisted by the spectacle of mass national press advertising, especially when the claims made by British Aerospace for its aircraft and its uniqueness cannot be factually supported.
Shorts has based its campaign on the well-proven principle of offering a better product at a more competitive price overall. The decision will be made by the Ministry of Defence on the basis of the facts. It is regrettable that the issue has been confused by claims made by British Aerospace which have no foundation in fact.
The most important matter of all is that the RAF should be supplied as soon as possible with a modern basic trainer which meets all aspects of technical requirements and specifications which it has put forward. Shorts' Tucano meets all performance requirements. There is clear evidence of long fatigue life. Short Brothers has the industrial capability to deliver a first-class product on schedule. Shorts' Tucano has competitive first-cost and low life-cycle costs. It combines maximum United Kingdom content with the greatest United Kingdom job creation potential. It is right for the RAF, it is right for the United Kingdom, and the time is right for a decision by Government in favour of the Shorts Tucano as a basic trainer for the RAF.
8.33 pm
Mr. Keith Best: My speech this evening must begin on a note of great sadness, because my constituent, Junior Technician Colin Wilson, just shortly after his 22nd birthday, was one of the young RAF bandsmen who so tragically were killed recently in Germany. I pay tribute to the courage, camaraderie and expertise of our RAF bandsmen. We hold them in the highest regard, and I know that the whole House will wish to share my expression of sympathy to his parents, Mr. and Mrs. Wilson of Holyhead.
My constituency is the home of RAF Valley, where all our fast jet pilots are trained. The station makes a valuable contribution to our island's economy, and none can be busier than the station's search and rescue and mountain rescue teams, which are kept fully occupied by accidents on Snowdonia. My right hon. Friend paid tribute to them in his speech.
The young pilots at RAF Valley have a great interest in which aircraft will be the next RAF basic trainer. The speeches by hon. Members on behalf of their constituents are commendable. British Aerospace has a strong lobby. I propose for a few moments to indulge in some special pleading, but I do not have a constituency interest, so I hope that hon. Members will accept that in my comments I can be regarded as being disinterested.
I might say, perhaps with a note of detached amusement, that the speeches for the Pilatus PC9 and for the Tucano would probably have cancelled each other out if one were conducting the debate on the basis of some sort of competition, but during a period in which there has been the most intensive lobbying for any new military project it appears that there has been a change of emphasis in the Government's interpretation of the specification.
Originally, the clear impression was conveyed that there was no point in or advantage to be gained by any contender for the project seeking to produce an aircraft much better than AST412. Now, however, the goalposts seem to have been moved., and it appears that encouragement is being given to those who have exceeded the requirements of AST412. I hope that my hon. Friend
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the Under-Secretary, when he replies, will make clear what is the order of the day. In any event, can my hon. Friend deny that the Hunting Firecracker's performance is well in excess of AST412 and can be equated with Swiss Pilatus? It is extraordinary that there is a debate as to which aircraft is best for Britain. Only the Hunting Firecracker is of total British design and can offer jobs in the long term on the back of export orders.
Mr. Gerald Howarth: Can my hon. Friend tell me what proportion of the components of the Firecracker are British?
Mr. Best: A very large proportion indeed. I do not wish to go down that route or to argue whether there is one percentage point more British components in one aircraft than in another, but I can tell my hon. Friend that it is a very large percentage. It does not derogate, in any event, from my statement that the Hunting Firecracker is of British design. If my hon. Friend will bear with me, I shall seek to persuade him of my point of view. Being the reasonable man that he is, no doubt he will be persuaded by the force of the argument.
It is only the Hunting Firecracker that can offer jobs in the long term on the back of export orders. I have never understood the argument that buying a foreign product is better for Britain when there is a British alternative. If there were to be a decision in favour of the Swiss Pilatus, backed by British Aerospace, we may smell the sweet breath of the Treasury down the back of my right hon. Friend, perhaps more with the thought of boosting the quotation of British Aerospace shares in a few months' time than with the thought of what is the best aircraft for Britain. I hope I am wrong, but that is a thought.
Is there any connection between the Government's interest in the Brazilian Tucano, built by Shorts, as it would be, and privatisation of the company? That is another question that it is perhaps proper to ask.
Mr. Wilkinson: I hesitate to say so, but I have flown all three aeroplanes, and on the basis of that experience I would not presume to make any suggestion; it is for the air staff to decide. Should not we say that the air staff should be allowed to have the aeroplane that they want and select?
While my hon. Friend is talking about other aeroplanes than the Firecracker being foreign, does he not remember that one of the best RAF trainers ever was the North American Texan or Harvard?
Mr. Best: My hon. Friend has a great deal of expertise and knowledge in these matters and the advantage over practically every hon. Member of having flown the aircraft concerned, and many other aircraft as well. I would not seek to cross swords with him as to his view of the aircraft. Although it is important that due weight should be given to the air staff's desire for an aircraft, I know that my hon. Friend, having been in the RAF himself, will no doubt be the first to agree that the air staff will go for the aircraft which they think is the best. It may be the most expensive, because the two are very often synonymous. That may not necessarily be in the best interests of this country. I know that my hon. Friend would not pursue that argument to its logical conclusion — that every piece of procurement should be done on the basis of precisely what the particular service demands at the time. But I accept the important point that he makes, that due weight should be given to the air staff's desire and expression of preference.

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Is it the Ministry of Defence or the Treasury that will make the decision on procurement for our armed forces? If it is the latter, perhaps we do not need the former and can make substantial departmental staff savings — I speak in jest and do not propose that seriously. The House should have regard to whether some of the points made by my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) in his intervention about the preferences of the air staff, the question of employment and what is best for this country will be uppermost in the Government's consideration when making the decision, or whether the decision will be based entirely on finance. Although I appreciate the need for economy, I should certainly be very unhappy if the defence of the realm were to be based entirely on what was the cheapest product going at the time.
Are we to be led by the nose by foreign competitors subsidised by foreign Governments, in one case with money borrowed on the international market which is unlikely ever to be paid? Can it be right to see the extra marketing in the world of a foreign aircraft which has been given the boost of endorsement by the Royal Air Force?
Hunting Firecracker would make no profit whatsoever on this project, but would seek to make its profit on future export sales, on which, of course, the Government would get a royalty, which they would certainly not receive on a foreign aircraft. There is no guarantee whatever that we would sell Hawk on the back of a Swiss deal, and even Pilatus is convinced that any such thing is at least five years in the future.
Hunting Firecracker is competing with aircraft subsidised by foreign Governments to be produced by Government-funded industries. It does not sound like the actions of this Conservative Government. I congratulate my right hon. Friend on what has been achieved so far by the Government for the Royal Air Force. I believe that it is a verifiable manifestation of our commitment to the first duty of Government—the defence of the realm. I can only ask my right hon. Friend to fight for his Department and for his Department's right to make the decision on the RAF trainer, not that of the Treasury, and to fight for the best interests of Britain and the RAF, which is in the forefront of the defence system.
8.43 pm
Mr. Tam Dalyell: There is an obligation on all of us to be succinct.
Refuelling crews—and I agree with the Minister on this—do a fantastic job on the airbridge. These guys work at the margin of safety and it is a tribute to their skill that a Hercules has not yet gone into the drink. The skill of the air-to-air refuelling pilots and personnel is so great and the job is so hairy that a tribute must be paid to those who carry it out.
I wish to concentrate on the airbridge and on Mount Pleasant and ask a number of precise questions which are probably best answered by letter rather than in the debate.
My first question is this. I understand that the Argentine air force has taken delivery of the Durandel anti-runway bomb which is made by Matra in France—and which is purchased in some quantity, incidentally, by the United States air force. Unfortunately, it can be delivered by small aeroplanes like the Skyhawk, which can take up to
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10 Durandels. It can be dropped at low altitude and we cannot be certain that every plane would be engaged by Rapier.
I understand that when the Durandel is released a parachute opens to slow the bomb, creating a safe distance of some 600 m between the detonation and the aircraft. A second parachute is then deployed to swing the bomb round to an impact angle of between 30 deg and 40 deg to the horizontal, minimising the risk of a ricochet. The rocket motor then ignites to produce 90 kN of thrust lasting about 0·45 seconds. Durandel strikes the concrete at around 260 m a second. After a one second delay the 15 kg of warhead explodes. Against reinforced concrete 40 cm thick, the weapon will produce a 5 m diameter crater at least 2 m deep and will break up a surface area exceeding 250 sq m. According to Matra, it takes more than a day to repair the damaged area and to resume operations.
This information comes from several sources. I ask, first, is it accurate and what is the Government's assessment of the Durandel weapon in relation to the Mount Pleasant airport?
Secondly, what is the Government's assessment of the Argentines' having acquired the Durandel, and have there been discussions with France about it? It seems very unsatisfactory that French industry should continue to supply the most sophisticated weaponry, given the situation in the south Atlantic.
Mount Pleasant has problems because there is no alternative to the Stanley airstrip. I ask, thirdly, could the Stanley airstrip take the TriStar on an emergency landing, because the whole policy, in the view of many of us, is vulnerable? Here we have a big runway, which therefore presents a big target.
I ask about the size of the repair squads. This may be classified information, on which I would not press the Government, but it would take only one Durandel to create havoc. What are the support facilities, and are the Government prepared to give possible targets and any indication of the sheer cost of the repair squads in Royal Engineer terms? That is my fourth question.
Fifthly, on the whole airbridge operation, what about the escorts? Whether conflict starts again is irrelevant to the Air Force debate, but I do not think that Alfonsin is going to start a war. However, the Argentine military have not gone away. Macho men humiliated are dangerous and it could well be, heaven help us, that the Falklands is used as an excuse for what many of them want to do anyway —destabilise the infant civilian regime. Therefore, we have to talk about the hypothetical situation of hostilities and I have to ask about escorts and how many are needed, because presumably everything in the airbridge, particularly the TriStars, has to be escorted.
This leads me to question no. 6, the whole question of interception. They do have Skyhawk. Is it the Government's assessment that they have Sidewinder? If they have, what representations have we made to the American Government about the supply of Sidewinder?
The whole interdiction situation really puts pressure on the entire line of flight. It is a very long chain of access to the Falklands, given also that there are heat-seeking missiles and the possible possession by the Argentines of Condors with German rockets and Italian guidance systems, approaching the Mount Pleasant airport at 4,000 miles an hour from a distance of under 500 miles; this really is a problem for Rapier.

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I ask question 7: What is the assessment of that?
If a runway is lost the brutal question 8 that has to be faced is, can our Phantoms operate, because then we would have no long-range interceptors? Once it was put out of action, presumably, without the Phantom cover it could be kept closed day after day. Once closed, the long-range interceptors —this is a curate's egg situation—cannot operate. It may be that there are many emergency arrangements for quick repairs. I do not know whether it is proper to ask question 9, but what are the contingency plans? In the eventuality of any fighting, these are highly relevant questions.
My next question, no. 10, concerns air-to-air refuelling and the resulting effect on our tanker squadrons, which are certainly needed in Europe. Can we have extra tankers? What is the standby force in the South Atlantic? Our tanker resources are somewhat scarce. I do not know whether the Government are prepared to comment on that.
I come to question 11. We know that Argentina has developed relations with Israel. Is it the Government's assessment that they have anti-radiation missiles from the Israelis? I put this in terms of pure speculation as I do not know whether such missiles have been supplied by the Israelis, but I know that Argentina has received advice from the Israelis, who are extremely good at tearing up runways. It is clear that there is a heavy logistic requirement in keeping an airport such as Mount Pleasant in operation. Money is important but to what extent are the resources that we are making available in the south Atlantic at the expense of air defence in Europe? Even if there is no fighting—heaven forbid that it should take place—considerable pressure can be imposed and one can be extremely nasty without killing anyone. The vulnerability of land-based planes in the south Atlantic is considerable. We are adopting a policy there that is rather different from our policy in Europe.
My 12th question concerns the cost of the Mount Pleasant airfield, which I understand is at least £350 million. The Minister may say that this is a matter for the Department of the Environment. If he does, I shall accept that response. He will be aware that there are questions on this topic on the Order Paper. However, I should like to know rather more about the crime that we read about. I understand that if people are couped up in temporary accommodation on building projects there is the possibility of an awkward situation. Against the background of press reports and the stories that some of us have been hearing — to which I have not given publicity — about crime in the construction of the airfield, there should be a Government statement.
My next question, no. 13, is directed to the cost of our presence on Ascension Island. We have a full-scale base developing on Ascension Island and I understand that the cost will be more than £40 million. When we think of the cuts at home, the £40 million that will be spent on Ascension Island highlights the incredible cost of the Government's policy in the South Atlantic.
My 14th question is about the cost of the extra TriStars, to which the Minister referred in opening the debate. I understand that there are to be three extra TriStars. Is it intended that they should be on standby?
My 15th question is on a different subject but one that is related to the previous issue. It is directed to Wintex '85 and the rules of engagement. In the light of the subject of 1982, which, rightly, I am forbidden to go into tonight, it seems that the change in the rules of engagement was
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extremely muddled, which is alarming in itself. Alternatively, orders on a particular occasion were given to the war cabinet. Who alters rules of engagement? I am not asking how alterations in rules of engagement are translated into fleet tactics or into Air Force tactics because I understand that the translation can be secret and sacrosanct. That is the proper domain of secrecy. However, it is right that Parliament should ask for what reasons rules of engagement are changed, to what they are changed and on what basis they are altered.
Wintex '85—the Minister will correct me if I am wrong but I think that he should refer to this issue when he replies — is about command and control and the lessons that should be learned from them. Before April 1983, Argentina had 130 aircraft. After the war it had 70. I understand that it now has 160. Included among them are some extremely sophisticated aircraft from France. For example, there are Mirage IIIs which are Nesher-Israeli adapted. Heaven help us, Argentina has some Mirage Vs. What are we to say — question 16 — to our French colleagues about this supply of arms?
Finally, I turn to a subject on which I am rather sensitive and which I think reflects on all forces. It is said that by constantly asking questions about what has happened in the past one revives painful memories. Therefore, with permission I shall read a letter I have received from Mrs. Iris Hall of 109 Barnes road, Cowley, Oxford. She wrote:
"I have wanted to write to you for many months but with my husband so desperately ill, thought it might be unwise if it got back to him and could upset him further. However, he died today, having been very ill for more than two years, since he never got over our only son Ian's death on HMS Coventry. I want to say please keep up your fight for what you believe should be."
She who was personally affected wants the truth of what happened, as does Mrs. Patricia Potter of Oriel cottage, Stafford road, Fordhorses, Wolverhampton, whom I saw last week. Her nephew, Lieutenant Adrian Anslow, was killed on the Atlantic Conveyor. I shall read a letter from an ex-service man, Squadron Leader Peter Nettleton, DFC, who wrote:
"It seems clear to me that the tireless persistency and integrity which you have shown on the Belgrano affair were reflected in today's Ponting verdict at the Central Criminal Court. You will doubtless agree that the verdict itself amounts to a massive vindication of the much criticised jury system. My thanks, congratulations and best wishes, Peter Nettleton."
I have read these letters because I know that there are some service men who have been upset by my recent activities. However, there are others who think that the truth should come out.
Finally, I want to make it clear that as a junior and new Member I used to visit a man who was married to my father's favourite cousin, and a distant relative of mine, who was a marshal of the Royal Air Force, Arthur Tedder. He used to impress upon me—this was at a time when he was physically ill, though mentally alert — that politicians had considerable obligations to the services. In my view, one of those obligations at present is to be concerned about the defence of our country and to make it clear in Parliament that questions should be asked about policies involving the services when it is not quite proper that the services should be asked to carry them out. I believe that even in military terms it is important that questions be asked about the role of the RAF—however skilled, courageous and dedicated to their profession its personnel might be—that the House is giving it in the south Atlantic.
8.58 pm
Mr. Gerald Howarth: I had not thought that it would be my privilege to follow the hon. Member for Linlithgow (Mr. Dalyell). Having heard what he said, I will forgo taking a similar approach to that of the hon. Gentleman. His actions, whether well motivated and well meant, have done a disservice to the nation. We are fortunate in having a Government who have the guts to take right and tough decisions, particularly at a time of crisis. I have had not one letter or telephone call of complaint from my constituents. I had a message from a constituent of a neighbouring Member of Parliament who said that the Government were right in their decision on the General Belgrano. Many of my constituents asked why that decision had not been taken earlier.
It is a great pleasure for me to take part in this debate, the first on the Royal Air Force in which I have had the opportunity to participate. I come to it without a special constituency interest. Sadly I have no aircraft factory or Royal Air Force station in my constituency; we would welcome either in Cannock if we could persuade them to come. I have some modest credentials in so far as I have served for three years in my university air squadron at Southampton and was commissioned in the Royal Air Force volunteer reserve, whose tie I proudly wear today.
There are three issues of major concern, two of which have already been referred to. In regard to air staff target 412, I was alarmed at the remarks by my right hon. Friend at the outset that the Minister of Defence is still persisting with the idea that the option of resparring the Jet Provost remains open. That is wrong for several reasons. The Minister should put that ball firmly out of court now.
The Jet Provost is 25 years old. Even if it were resparred, we would still have a thirsty turbo jet whose equipment is many years old. Originally about 19 companies tendered for the new aircraft and we are now down to a shortlist of four. Those companies have gone to considerable expense in order to be able to tender for the contract. I hope that my hon. Friend the Under-Secretary of State for Defence Procurement will be able to reassure us tonight that resparring the Jet Provost is out.
Originally there was anxiety amongst the professionals in the Royal Air Force that we were even contemplating a turbo prop solution rather than a turbo fan aircraft which everyone knows was on the British Aerospace drawing board. I understand that many of the sceptics have been won over to the idea of a turbo prop as a result of their experience with aeroplanes which are currently flying.
The competition has done a useful service in that it has resulted in the Royal Air Force definitely being provided with an aeroplane which will be superior to the one it would originally have been offered. All the companies have gone out of their way to ensure that they have fine-tuned their offers to produce the best option.
I speak with a personal interest because it was possible for me last summer to spend three days at the central flying school, flying a variety of aeroplanes, including the Jet Provost mark 3 and the Jet Provost mark 5. In the mark 5 I was undertaking a typical low-level sortie that a student would undertake, with the objective of flying over the Pennines at 250 ft to locate a target and fly back. The importance of speed in the equation was impressed upon me.
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Unless a student pilot is pushed to fly at high speeds of around 300 knots, there will be a substantial leap between the speed of the basic trainer and the aeroplane which the student will next fly, the Hawk. This low-level exercise is central to the role of training in the Royal Air Force today. Today's modern aircraft fly at a low level. Therefore, it is important that a student gets such experience from the outset.
Speed is also important because it enables the aircraft to climb quickly through our invariably muggy weather where there is low cloud, very often extending up to 10,000 or 15,000 feet. Therefore, we want an aircraft which can get up to a working height as quickly as possible. I am pleased that the Minister is considering a speed of a usable 240 knots instead of a desirable 240 knots. I agree with my hon. Friend the Member for Ynys Môn (Mr. Best); I am sorry that he is not in the Chamber at the moment. He had a point when he said that the goalposts have been shifted. Air staff target 412 was not drawn up correctly.
All four companies which have tendered have met the specification but they have a valid criticism. Some of them, principally the company tendering for the Firecracker, say that they were told that the speed should be 210 knots, with 240 knots at the maximum, and now the Ministry is saying that the usable speed should be 240 knots. Therefore, I have that sympathy with them.
I agree—I think that this is the mood of the House today — that we do not want a political aeroplane. I hope that my hon. Friend the Under-Secretary has got that message — I am sure that he has — and that he will convey it to the Secretary of State and his colleague, my right hon. Friend the Minister of State for Defence Procurement. It would be wrong to favour one area of the country with jobs as against another. As has been said, if jobs were created in one area, they could be lost in another. It would also be wrong to allow foreign policy considerations to enter into the argument. It would be wrong to buy an aeroplane simply to boost the balance sheet of a company that the Government have high hopes of bringing into the private sector — that is, Short Brothers, which is an excellent, first-class company. I agree with privatisation, but it would be wrong if we were to make the major objective privatisation rather than finding the right aeroplane for the RAF.
All the contenders, in their way, are excellent aeroplanes. They would not have been on the final list if they were not. I have flown two of them—the Tucano and the PC9—so I speak with some experience of them. Unlike my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson), I have not flown the Firecracker. The Westland A20 is not even off the drawing board.
The campaign has often been vitriolic. I should like to deal with each of the contenders in turn. I strongly commend the initiative that has been taken on the Firecracker. I am sure that my right hon. and hon. Friends do as well. The people in the company have put their money where their mouth is. They have done what the Government have asked the industry to do and what they have asked our talent in the design teams to do, which is to produce a British product that can be a world-beater. However, I believe that they have not been entirely straight in the way in which they have conducted their campaign on Firecracker because it is not an all-British aeroplane. For a start, the engine is Canadian and other

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parts, which my hon. Friend the Member for Ynys Môn was not willing to divulge to us, are not of British manufacture. For example, I understand that the escape system is a United States Stencil system, although I believe that the company is considering putting in a Martin Baker seat.
Westland is an excellent company, and we have heard from the hon. Member for Yeovil (Mr. Ashdown) about it, as well as from my hon. Friend the Member for Westonsuper-Mare (Mr. Wiggin), who eloquently put the case for it. It is important that we look carefully at the predicament in which Westland finds itself over its helicopter production schedule. I hope that my hon. Friend the Minister will take careful note of that. That aeroplane is not off the drawing board yet, so the RAF is entitled to look at something that is flying.
Mr. Wiggin: Will my hon. Friend consider the history of aircraft acquisition by the RAF? Every major aeroplane bought since the last war and., indeed, some during and before it, has been bought off the drawing board. Therefore, that criticism is not valid.
Mr. Howarth: I am grateful to my hon. Friend for that remark. What he says is true. However, we are faced with real as well as drawing board options. There are some good real options, so we should look more carefully at them.
I have already saluted Short Brothers. It has done a magnificent job. Its recent order in China was the latest in a series of highly successful deals that it has pulled off under its highly dynamic and excellent chairman, Sir Philip Foreman. However, there are one or two problems with the Tucano in terms of export prospects. There is already the Embraer 312, on which that aeroplane is based, and there is the aeroplane that is being produced under licence in Egypt, both of which will be competing for that export market. Although Shorts' Tucano will be a more sophisticated aeroplane than its competitors, it faces a ready-made competitive market.
It is not true to say that British Aerospace does not need this contract. It needs this contract just as much as the other companies. We should not put British Aerospace out of court simply because it is the major defence and aeroplane manufacturer in this country.
The Hawk and PC9 package is a sensible support package. Although it is true that the Swiss are not committed to buying the Hawk, it is true also that, if the PC9 is not bought, there is no chance whatsoever that the Swiss will buy the Hawk. We should bear that important point in mind.
It is not my job to evaluate the technical merits of these aeroplanes, because that has already been done at Boscombe Down. I do not deny that, in a sense, I speak for the Royal Air Force, although I am in no way authorised to do so. I believe, as do most other hon. Members who have spoken in this debate, that the aeroplane that is chosen must be the one that the RAF wants. I have drawn on my experience as a pilot — admittedly, of limited hours—and I believe that speed is the vital factor. One aeroplane is faster than the rest. It is important to note that, if the AST412 was wrong in the first place, it is not my job as an hon. Member to go along with a mistake. Speed is important and the PC9 is marginally ahead of the rest. I believe that that is the position as the RAF sees it.
Mr. Robert Atkins: As my hon. Friend knows, I do not hold a particular brief because I was not a pilot—
Mr. Wilkinson: Except for British Aerospace.
Mr. Atkins: That is not true. I do not hold a brief for any particular organisation. The Garrett engine has now been made available to the Tucano, and, in terms of speed, the Garrett engine will exceed the RAF's requirements. That puts a whole new complexion on the Tucano.
Mr. Howarth: My hon. Friend is correct. I was discussing this matter the other night with Short Brothers. The fact is that that engine has not yet been mated with the aircraft frame. There must be further developments. It is not for me to judge whether that is good or bad; it is for the Royal Air Force to judge. I am trying merely to bring to the debate some of my experience as a trainee pilot sitting in the front seat having my head beaten by an instructor and being told not to make mistakes.
There are pros and cons to be considered when proposing collaboration. Although collaboration may be a splendid objective, complex decision-making procedures —often involving changes of Government—must take place. Those procedures can result in lengthy discussions on whether to proceed with a decision taken by a previous Government, on the work share allocation and on differences of objective. I believe that differences of objective are the most important factor to consider in contemplating collaboration. I heartily endorse what my hon. Friend the Member for South Ribble (Mr. Atkins) said about collaboration. I believe that the project is already slipping. British Aerospace needs to develop a new aeroplane in order to keep its design team together. The RAF needs a new aircraft to ensure that it is capable of meeting threats. If we do not take action swiftly, export markets that are currently open to us will be lost for good.
For those reasons, I urge my right hon. Friend to make a swift decision one way or the other. Some Conservative Members are outraged at the fact that the French are trying to delay this project to advantage the Mirage 2000 and to ensure that they get what they want at our expense. There is no doubt that the home solution could be remarkably cheap, and probably as cheap as a collaborative programme, especially bearing in mind that collaboration itself has costs.
I know that my right hon. Friend the Minister of State will take an early decision and that he will not close the door to the possibility of a United Kingdom solution.
9.15 pm
Mr. Stuart Randall: I have not had the flying experience of the hon. Member for Cannock and Burntwood (Mr. Howarth), although I did fly Tiger Moths in the early to mid-1950s. We had leather helmets and gloves in those days. However, I have had a little experience of procurement. As I know that other hon. Members want to speak, I shall be brief and address myself to one issue—the jet trainer replacement.
I was interested to hear my hon. Friend the Member for Kingston upon Hull, North (Mr. McNamara) describe the programme of procurement of a new aeroplane to replace the Jet Provost. I will not go into the details, but it is a remarkable process. We are now going through a rebidding operation, which is of great concern to me. I hope that the Minister will comment on that.
I understand that initially there were 20 contenders for the contract, of which four were short listed. After some

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considerable time, there was a further shortlisting — a short shortlist—of two, the manufacturers of the PC9 and the Tucano. They were then — and this is quite remarkable—asked to submit another bid, the effect of which was to open up the whole position. The manufacturers which were knocked out in the short short-listing procedure asked their parliamentary representatives to lobby the MoD and all and sundry to be put back on the list. The consequence is that there are now at least four contenders. From what the Minister said in his opening remarks, I understand that a refurbished Jet Provost is back on the list, but I am not sure whether that is an additional contender, making five in all. The asking for subsequent bids is inept because of the pressure to get companies that were knocked out back on the list. That has shown that there is uncertainty and confusion.
An article in Flight International on 2 February entitled "Modus Operandi" is worth reading. It describes in detail some of the disadvantages of that approach. Once we go back to having four companies submitting additional bids, that means additional development work for them and the expenditure of extra money, which is a waste of the nation's resources. It is not the way to go about these matters.
The problem has emerged mainly from the fact that none of the turbo trainers was really suitable apart from the PC9, although that has had to have larger power units and, because of the specification produced by the RAF, the company is trying to re-engine the plane. This waste of resources could have been avoided had another process taken place. As a result, we are putting in larger engines, and the relationship between airframe life, range, fuel consumption, capacity, weight and so on will be upset. If the PC9 is not selected, it could result in a risky project —and we have already heard about Nimrod.
If we attempt to doctor these things, will we end up with another delayed project and perhaps even with an aeroplane with which the RAF would be dissatisfied? A more straightforward process could be achieved if we first selected the type of aircraft which is best for the job. We could then have a competitive tender on that, followed by a second stage when there would be further competitive bids from the manufacturers and the various consortia which were prepared to provide the aircraft that best fitted the bill.
The advantage would be that the RAF would end up with the aeroplane that it wants, and the Treasury would be able to get the plane that it wants at the price that it wishes to pay. Consequently, everyone would win. In addition, this more logical approach to procurement would create more jobs and a stronger industry. We would be able to buy more aircraft and would have a better defence for Britain.
This venture into competitive tendering is a worthwhile approach, but I wonder whether there is a lack of direction in carrying out the procurement process. My strong opinion is that jobs should be taken into account. There is no doubt in my mind that we must have the best aircraft for the RAF, but we should create as many jobs as possible.
Many of my constituents work at Brough. It has been suggested that, with the PC9, 85 per cent. of the airframe
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work for the RAF planes would in man hours be carried out in Britain, and that 15 per cent. would be carried out by the Swiss Pilatus company.
The hon. Member for Beverley (Sir P. Wall) referred to further orders. British Aerospace is optimistic about further sales if we choose the PC9. I understand that about 24 planes are required in Switzerland and that the 160 Swiss Hunters require replacement. There is optimism that these could be replaced by the single-seat Hawk 200.
Humberside is a region of high unemployment, and in my constituency male unemployment is now 20·5 per cent. This project would be important, given that there is a lack of high technology industry in the area. Much of our industry is primary. As well as fishing, there is steel making on the south bank. Consequently, the PC9 project, which I hope the RAF will be supplied with, would stimulate technology and the economy in the area. Trade unions have contributed magnificently in the campaign, and we should recognise that men have spent hour upon hour on it. Some people may say that that is not what they should be doing. Nevertheless, we must recognise that they have made every effort to ensure that the PC9 gets work.
The PC9 is the best aircraft. If we opt for one of the botched-up versions of it, several hon. Members will be interested to monitor the project to see whether we have another potential Nimrod on our hands.
9.25 pm
Mr. Michael Marshall: I declare an interest as a parliamentary adviser to British Aerospace, Space and Communications Division. My specialist interest in space allows me to withhold any comment about the RAF trainer, and I am sure that the Minister will be glad to have one less voice lobbying him tonight. The matter has been well aired.
In the short time available to me I shall concentrate on a matter raised by my hon. Friends the Members for South Ribble (Mr. Atkins), for Edinburgh, West (Lord James Douglas-Hamilton), and for Cannock and Burntwood (Mr. Howarth) and that is the fallback position if we cannot get a collaborative venture on the European fighter aircraft. I agree with my right hon. Friends and Opposition Members who said that there must be worries about the slippage in the project.
Anyone who looks at the history of other collaborative projects must recognise that the French national interest has always fought extremely hard. I am worried that the enthusiasm of the French for the Mirage 2000 and their ideas about a new engine for it do not sit happily with our interests. Indeed, their current interest for a light aircraft goes against our perceived views, and adds to the problem. I hope that my hon. Friend the Under-Secretary of State for Defence Procurement will assure us that the Government are already considering the fallback position.
If one takes a dispassionate view, the fallback position could relate to the option of buying American. I hope that my hon. Friend will take the opportunity tonight to make it plain that the Government would think long and hard before they decimated the defence airframe industry in the United Kingdom and removed the avionics capacity, which has been a key element in successful developments, such as Tornado and Jaguar. When he deals with the alternatives, I hope that he will say something about the experimental aircraft programme. Substantial resources have been committed to it. I applaud the Government's

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willingness to do that and to act quickly. I look forward, as many hon. Members do, to seeing that aircraft fly at Farnborough next year. I hope that by then we shall have in our minds and in the planning of Government a better feel for what the British national solution may be.
From the briefings I have had, I understand that there is a possibility of a British national programme that would not be out of line financially compared with the likely cost of a collaborative programme. That is especially true if one takes out, as one should, the question of the development of a new aircraft engine because that raises wider issues, other possibilities in the export market and so on.
The interest in the EAP can lead to a realistic view of the threat. I am a member of the Select Committee on Defence and think that we should constantly remind ourselves that we are dealing with the threat in the 1990s and, to be more specific, the MIG 90. If we are not careful, in the long-drawn-out processes of Government —this has been one of our failings in the past, as has been getting industrial collaboration moving quickly—we could have slippage, both in time and in meeting that genuine threat.
Before concluding my speech, I cannot help but say a word or two about the Falklands. I went down there about two years ago and, like the hon. Member for Linlithgow (Mr. Dalyell), I should like to pay tribute to the remarkable efforts of the air crews. They manage to get not only people like me but far more essential traffic to and from the Falklands. But, unlike the hon. Gentleman, I look forward to the day when the airfield is completed, as that will make life that much more bearable and will enable us to look at the whole question of the Falklands in a better and more productive way.
My text on the Falklands was given to me by a very senior retired RAF officer, a constituent of mine, who said to me when the task force sailed, "Right. You have all joined hands and the will of Parliament is to support this great venture. All I ask is that you make sure that the politicians do not seek to interfere with operational matters thereafter and when the battle is over, I pray you don't spend the next few years trying to suggest where we went wrong."
The hon. Member for Linlithgow has done nothing but that. It grieves me to say to a colleague for whom I have had respect for many years in other matters that he is totally out of touch with the country on this issue, as was his contribution in this debate tonight.
9.30 pm
Mr. Stephen Ross: I am grateful to the hon. Member for Kingston upon Hull, North (Mr. McNamara) for having given me a few minutes in which to make my speech. I represent a constituency that designs and builds aeroplanes, but which does not seem to benefit from them. The PC9 was, I believe, mostly designed at Bembridge. I am a former non-executive director, of Pilatus Brittan Norman. I had to resign two years ago, and I miss the £2,000 a year that I used to earn. But Firecracker was originally put together by Desmond Norman in an outbuilding at Whitwell on the Isle of Wight and was finally completed at Sandown. There is also Westlands, with its subsidiary the British Hovercraft Corporation, which has the A20 with the Australians, and Shorts, which subcontracts much of its work to Cowes. For example, the wings of the 330 and the 360 are built there.
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I was told today by Westlands that if it failed with the A20 it would benefit most with the Tucano. Our Northern Ireland colleagues are not in the Chamber now, but they rightly want most of the work involved. At Christmas I wrote to Sir Phillip Forman congratulating him on his publicity, and pleaded with him that, should he be successful, he should subcontract some of the work to the Isle of Wight.
But the real reason for my intervention is that I am scared stiff of what will happen to the British Hovercraft Corporation. Some very able people down there designed and built the hovercraft. The 188 was very successful, but unfortunately the Navy does not seem to want hovercraft. Nevertheless, I am sure that its role in mine countermeasures operations is outstanding and that is an area of defence that we ignore at our peril. That is the sort of role that that hovercraft should be playing. However, that does not seem to be on, and I believe that the old BH7 is now to be sold. The whole future of the British Hovercraft Corporation is tied up with Westlands, so serious consideration should be given to Westlands' plea, which has been echoed in several parts of the House, that the ST404, and particularly the W30, should be brought forward. That would obviously help enormously.
There are 1,500 skilled people working on the Isle of Wight with the British Hovercraft Corporation. That company is our biggest employer. It used to employ more than 2,000 people, but there have been substantial redundancies. The Isle of Wight's unemployment rate is now 17·1 per cent., which, with 300 or more redundancies, would quickly go above 20 per cent. We would then, surely, qualify for assisted area status, but that is not a situation we seek.
The Isle of Wight would be helped if the Castor programme was brought forward. It is a very cheap programme, which uses the Islander aircraft. It does not use a Nimrod, so the Government should ignore any pleas from the RAF to use Nimrod in that role. I believe that the PC9 is the aircraft that the RAF wants. If that is agreed, it will encourage Dr. Buhle—who owns 70 per cent. of Oerlikon Buhle with his sister—to continue investing in the Isle of Wight. It will also help to bring back to Bembridge production of the Islander aircraft. That aircraft is at present produced in Romania. That would create more jobs.
That is my plea, and I am very grateful to the hon. Member for Kingston upon Hull, North for allowing me to make it.
9.35 pm
Mr. McNamara: With the leave of the House, I shall reply to the debate.
We have had a very interesting and full debate, despite the shortage of time. Due to the arrangements that usually exist between the Under-Secretary and myself, I think that all those who wanted to speak in the debate have managed to do so. That is good, because every hon. Member should have the opportunity to air his constituency interests and, more importantly, to look at the issue in the round, together with all the problems facing the RAF and our defence industries.
I should like to make a point that I believe has the full support of every hon. Member. We regard it as absolute nonsense to go for the refurbishment of the Jet Provost. That is a relatively uncontroversial statement. It is penny

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wise and pound foolish of the Government still to put forward that idea. Many millions of pounds would be spent on an aircraft with a very short life.
There has been a remarkable agreement on both sides of the House—between Haltemprice and Hull, west and between Scunthorpe and Hull, north—about what plane the RAF should have. When the time comes for a decision, I hope that it will be made on the basis of what the RAF needs—not upon what Humberside, Belfast or Westland need. We have a duty to ensure that we provide the people whom we expect to fly the aircraft and protect the nation with the best training aircraft available. We all have our own ideas of what that is, but the consensus is that we should provide the plane that the RAF wants.
Hon. Members have expressed their concern about what will happen to the European project for the new fighter plane. All hon. Members have mirrored the fear, almost to the point of becoming paranoid, about the role of the French and their attitude to the Mirage 2000. Perhaps behind the scenes the Secretary of State is flexing his muscles rather than swinging the Mace and working hard and long. However, we have the impression that the French are making the running. It seems that the Secretary of State, in his desire to appear to be a good European and to escape from the idea that we are not really part of Europe, is submerging some of our basic national interests. The message from the House should be that we want firm assurances. The defence of our country and the maintenance of a firm industrial base upon which we can defend our country requires early decisions.
That argument from both sides of the House is that, despite what has been said today and despite what the Government are doing about collaborative projects, Westland should have an early decision on the helicopter to relace the Puma and the Wessex. That is important in industrial terms and in national strategic terms.
Sometimes we tend to be a little parochial in that we concentrate on our own industries and interests. My hon. Friend the Member for Shieffield, Attercliffe (Mr. Duffy) and the hon. Member for Beverley (Sir P. Wall) reminded us of the importance of the RAF plane in its NATO role and some of the problems involved in the need for a stand-off ability in our airfield destruction weapons. That is important.
Repeatedly our attention is drawn to the United Kingdom's vulnerability and the problem posed by the disaster, for which we all share responsibility, of the Nimrod early warning system. We are right to be concerned about that. We must consider the importance of an early warning system. If the Shackleton cannot provide it, we must wait a long time for Nimrod. We should consider whether we can afford to gamble for another three or four years. As the hon. Member for Ruislip-Northwood (Mr. Wilkinson) said, the possibility of leasing AWACS until we reach decisions would not meet some of the proper anxieties of the House.
Different people have different attitudes about the campaign that my hon. Friend the Member for Linlithgow (Mr. Dalyell) has waged concerning the Falklands. I have not always agreed with him, but it is right and proper that he should have raised his anxieties in his role as a Member of Parliament. The Opposition supported the Falklands campaign as we have no time for invasion and the resolution of international differences by unprovoked
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aggression. However, the Government and the Conservative party are out of touch with the country in that, having successfully conducted that campaign, they do not realise that we should turn our attention to resolving the fortress Falklands issue to get away from the great drain that the Falklands will be on our defence capability.
A great responsibility lies on the Government in initiating such procedures. It is a case of being magnanimous in victory. There should also be a note of caution as we know what has been supplied to and obtained by the Argentine Government since their defeat in the Malvinas. Our international relations and Britain's primary defensive role are not helped by our having a festering sore in the South Atlantic. It is also no help to us for a large part of our Air Force effort to be concentrated there. The Opposition's policy has been to try to find some proper accommodation with Argentina. We must not drop our guard or be prepared to be rolled on again, but we must be prepared to talk.
There has been a sense of unreality about the debate. As my hon. Friend the Member for Eccles (Mr. Carter-Jones) said, it is taking place under the shadow of Trident. We do not know what it will cost. With the pound going up and down against the dollar like a yo-yo, expenditure on what we regard as a superfluous system will be increased. The Trident expenditure will impinge ever more on our ability to pay for the defence of our country by proper conventional methods.
We want a proper conventional defence — a strong Air Force and a strong industrial base. All that is being put at risk. The Government said that they will not introduce another White Paper. They will have to introduce another White Paper and another defence review or they will introduce no programmes but try to pretend that everything is fine. If that happens, the Secretary of State will build up problem after problem for his successors. That is not the proper role of the Secretary of State. He must meet the new challenges within the limitations that his budget puts on him. If he does not do that, we shall end up with structural disarmament, That would be a tragedy for Britain and the free world.
9.45 pm
The Parliamentary Under-Secretary of State for Defence Procurement (Mr. John Lee): It gives me great pleasure to close this year's Royal Air Force debate. This Government can be justifiably proud of their record of spending and support for the RAF. Since we came to power, expenditure on air systems, most of which goes to the RAF, has risen over 40 per cent. in real terms, as was mentioned earlier by my right hon. Friend the Minister of State for the Armed Forces. Expenditure on RAF equipment for 1985–86 is estimated to be £3,506 million and a total RAF complement of around 93,000 represents expenditure approaching £38,000 per person.
As an article in the Financial Times said on Tuesday of this week:
"The RAF is in the throes of its biggest re-equipment programme since the Korean war."
This continuing programme is reaching its peak and will mean that by 1989 over half of our aircraft will have been recently replaced. This compares with five years ago when half our front line was over 20 years old. With the greatest respect to the hon. Member for Eccles (Mr. Carter-Jones), I do not see the picture that he painted of the RAF. Inevitably, though, with 1985–86 bringing an end to the

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3 per cent. expenditure increases, our budget is increasingly tight, given the costs and sophistication of modern aircraft, weaponry and software. That is why we are striving for greater efficiency, competition and international collaboration on defence spending, with emphasis upon improving the teeth-to-tail ratio and upon increasingly involving the private sector in support tasks and by putting schemes out to contract.
Mr. Carter-Jones: If the hon. Gentleman is so convinced that we are on target, will he tell us what aircraft we shall have in 1995 to defend us in a fighting capacity, given that more than 10 years are needed to develop such an aircraft?
Mr. Lee: I shall write to the hon. Gentleman and give him a list of the aircraft which we expect to have in operation in 1995.
Mr. Carter-Jones: Can the hon. Gentleman not give those details now?
Mr. Lee: No, I cannot do so now because I have very many points to deal with.
I was not surprised to hear mention of the competition to provide a new trainer for the RAF to replace the aging Jet Provost. There were speeches from hon. Members which supported each of the individual contenders. On the PC9, there was the speech of the hon. Member for Kingston upon Hull, North (Mr. McNamara). His broad approach is that what is good for Brough is good for Britain. While one understands his constituency interests, I believe that the hon. Gentleman was unfair in being so disparaging about a number of the other contenders when he does not have all the facts and figures in front of him, in particular the financial aspects. Support for the PC9 was also given by my hon. Friend the Member for Beverley (Sir P. Wall), the hon. Member for Kilmarnock and Loudoun (Mr. McKelvey) and for my hon. Friends the Members for Edinburgh, West (Lord James Douglas-Hamilton) and for Cannock and Burntwood (Mr. Howarth). Support for the A20 came from my hon. Friend the Member for Weston-super-Mare (Mr. Wiggin). The case for the Shorts Tucano was made by the hon. Member for Antrim, East (Mr. Beggs) and the Hunting Firecracker was supported by my hon. Friend the Member for Ynys Mon (Mr. Best), who also had an Adjournment debate on that topic.
We currently have about 160 Jet Provosts in service but they have outdated avionics, high fuel consumption, side by side seating and a poor ratio of support man hours to flying hours. They would need major refurbishments to meet the pilot training need beyond the end of the decade, but I have to say that we have not yet ruled out the refurbishment option. [HON. MEMBERS: "Oh"] Despite the obvious groans, my hon. Friend the Member for South Ribble (Mr. Atkins) pointed out earlier that if that refurbishment option did go ahead it would give him and his constituency some work and that that was his reserve option.
Quite naturally, attention has focussed on the requirements of ASR 412 and the evaluation of a new trainer aircraft. We are looking at an order for some 130 aircraft with an option for a further 15. It would be a turbo prop with jet-like handling, tandem seating, good climbing power and full aerobatic performance. Obviously we also want it to be reliable and economical to operate.
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My experience of the past 16 months or so is that competitions of this sort generate a good deal of powerful lobbying and this certainly has been no exception, as was pointed out by my hon. Friend the Member for Weston-super-Mare. The competition has provided excellent business for the restaurants and hostelries around Westminster. It has benefited considerably the stationery industry. The post office has also done extremely well.
No-one will be surprised if I say that we listen very carefully to all the points that are made to us and that we take into account in coming to a decision a very wide range of relevant factors.
It will be even more unsurprising if I say that our evaluations are impartial, and that the relevant factors include broader industrial and economic issues. That is the background against which most of the lobbying takes place. For our part, however, we must restate that the main consideration is to provide the Royal Air Force with a suitable aircraft to fulfil its training requirements.
We asked for best and final offers from two manufacturers — from Shorts, with their Tucano, and from British Aerospace, with the PC9. In the event, we also received best and final offers on the Hunting Firecracker and the Westlands A20.
My right hon. Friend the Minister of State for Defence Procurement earlier indicated to Hunting and to Westlands that they really were not in the competition at that stage but that nevertheless, if they wanted to submit ultimately, at their expense, best and final offers, they would be considered. They were told at that stage that they were not likely to be considered, in order to save them further money. I suggest that the competition has been handled extremely fairly by the Ministry and that ultimately the RAF will get a very good buy, assuming that it goes ahead with a new trainer.
Mr. McNamara: Can the hon. Gentleman say when?
Mr. Lee: The decision will be taken in the spring. [HON. MEMBERS: "Which spring?"] Spring 1985.
Several hon. Members have mentioned the European fighter aircraft, commonly known as EFA — perhaps some day I shall be able to say "affectionately known as EFA". We are still at a complex and difficult stage of studies and negotiations.
The hon. Member for Kingston Upon Hull, North dealt with the whole matter of EFA, as did the hon. Member for Eccles, and my hon. Friends the Members for Edinburgh, West, for Cannock and Burntwood and for Arundel (Mr. Marshall).
A particularly strong plea that I shall not forget was made by my hon. Friend the Member for South Ribble, who spoke most passionately and most eloquently, as he always does in matters affecting British Aerospace and his constituents who work at Warton in the South Ribble constituency. I fully understand his sentiments. As a Lancashire MP, I know the importance of Warton and have a number of sub-contracting companies to British Aerospace in my constituency.
In the mid-1990s we shall need to replace our current force of Jaguars and Phantoms. So far, we and four other countries—France, Germany, Italy and Spain—have agreed on a European staff target that specifies a single seat, twin-engined, agile, short-take-off-and-landing fighter. This will be primarily an air defence aircraft but with good ground-attack capability. We shall need about 250 such aircraft.

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Feasibility studies are in hand and the industrial element of those, including participation by British Aerospace and Rolls-Royce, has recently been completed. Those industrial reports were delivered to officials last week and are now being studied in detail in each capital. It would be wrong of me to anticipate the outcome of the national and international assessments but we are proceeding with all speed, and it is intended that the five Defence Ministers should meet in the spring to take stock of the position and decide how best to proceed.
The House will be aware that our starting point is our concern to maximise co-operation and collaboration in Europe while seeking to meet the equipment requirements of the RAF. EFA should become a positive manifestation of that goal. Our work over the coming weeks will be to establish whether that claim can be met while simultaneously ensuring that the legitimate aspirations of the five nations' taxpayers, air forces and industries are properly safeguarded. There is a strong political will in Europe that an EFA programme should be launched and that it should proceed. We shall continue to play our full part in the process of striving for a cost-effective collaboration programme based on fair and equitable terms for all partners.
If we succeed, we shall be launching more than a procurement programme. Therefore, we shall be setting the seal on a new and exciting phase of European co-operation, the political, economic, industrial and defence implications of which could be profound.
While I fully understand some of the anti-French sentiment that has been expressed in the Chamber this evening, it has not, in my view, been over-helpful. Surely we should be trying to bring our nations together in terms of collaboration.
Mr. Robert Atkins: I am grateful to my hon. Friend for his kind remarks about me, and I know his understanding of the subject, but will he please recognise that, with the pressure on MPs with constituents working in British Aerospace, they need to have more that fine words; they positively want something to happen.
Mr. Lee: I fully understand the comments of my hon. Friend and he does not need to over-egg the pudding; I get the message.
I turn now to Westlands, of particular interest to the hon. Member for Yeovil (Mr. Ashdown), to the hon. Member for Isle of Wight (Mr. Ross), and to my hon. Friend the Member for Weston-super-Mare. Westlands is and will remain a vitally important defence contractor. The services depend on Westlands for support of in-service helicopters and the production of new aircraft. Ministers of a number of Departments are closely in touch with Westlands. We are fully cognisant of their problems and are working closely with the company.
None the less, the Ministry of Defence supports the company's efforts, encouraged by Government launch aid, to diversify into civil markets. Civil prospects with EH101 and W30 look most encouraging from 1990 onwards. The company will nevertheless continue to need military orders from both the United Kingdom and export markets. We recognise that the company is currently short of orders for production aircraft in the late 1980s. We are therefore considering with them what help the Government
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can give in generating additional orders in the medium term. I note all that has been said in the debate by a number of hon. Members on the W30.
Mr. Ashdown: The Minister has said that he would like to help the company. Does he realise that the greatest help that he can give to the company is a decision one way or the other, in principle and not necessarily tied to a time, on the AST 404? Can he give any indication of the time when such a decision might be forthcoming?
Mr. Lee: I could not give a comment on the precise timing, but I repeat that we are fully aware of the situation at Westlands. I note the hon. Gentleman's constituency interest and his own interest as a small shareholder. On a personal note, when we privatise the Royal Ordnance I hope that he will indicate his support. We will send him a pink form in the hope that he will buy £20 worth of shares in that.
On the question of Nimrod AEW, several hon. Members expressed concern about the delay and cost overruns in this project. Let me say immediately that I share their concern. It is not a procurement exercise of which either the Ministry or industry can be particularly proud.
In the interest of saving time, I will move fairly fast to cover a number of other topics.
The hon. Member for Eccles mentioned British Aerospace, Woodford. We fully appreciate the loading problems faced by British Aerospace in Manchester. We have been considering a number of possible programmes which could be undertaken in the industry and the transfer of Nimrod major servicings is one of these. It is hoped to make an announcement shortly. The future of Woodford must, of course, be primarily a matter for the British Aerospace management to determine but we are aware of the situation there.
The hon. Member for Edinburgh, West mentioned the subject of reintroducing a flying role for the Royal Auxiliary Air Force when resources permit. I share his wish to improve the role of the Auxiliary Air Force and would draw his attention to our decision to set up a new auxiliary RAF Regiment squadron to provide anti-aircraft defence at RAF Waddington.
My hon. and learned Friend the Member for Ruislip-Northwood (Mr. Wilkinson) asked whether we were planning to update the Phantom F2 avionics in the same way as we are updating the Buccaneer. In fact, the avionics in the Phantom were fitted much more recently than those in the Buccaneer. This, together with the fact that the Phantom will be largely replaced by the Tornado F2, means that such an update is neither necessary nor cost-effective.
We are also very conscious of the need to update our IFF capability. This was mentioned by my hon. Friend the Member for Beverley and others. We are developing with our NATO partners a NATO identification system. This system will incorporate new technology to meet the threat in the electronic environment in the 1990s and beyond.
The hon. Member for Sheffield, Attercliffe (Mr. Duffy) and my hon. Friend the Member for Beverley both raised the subject of the long-range stand-off missile. In partnership with the United States and West Germany we have agreed to undertake a feasibility study into options for introducing such a weapon in the 1990s. This study should be completed in November 1986.

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The hon. Member for Linlithgow (Mr. Dalyell) asked a whole range of questions on his particular topic. I will discuss those questions with my ministerial colleagues and we certainly will take note of them.
On the question of Tornado, which was mentioned by a number of hon. Members and is of specific interest to my hon. Friend the Member for South Ribble, we are currently considering with the RAF whether we should buy a quantity of Attrition aircraft, but as yet no decision has been taken.
On the whole question of defence sales, there are prospects in a number of countries. I cannot comment on them in detail but in fact — a number of my hon. Friends will bear me out—British Aerospace and British industry have given the Ministry of Defence and its sales team considerable credit for the efforts we have put into the sales effort.
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My hon. Friend the Member for Weston-super-Mare asked about the Meteorological Office and the cost of the service. I visited the office recently and I can testify that it provides a valuable service in many areas. It was the subject of a resource control review and in implementing the recommendations that flowed from that review the office is actively seeking new ways of exploiting its services in the commercial sector.
Mr. John Mc William rose in his place and claimed to move, That the Question be now put.
Question, That the Question be now put, put and negatived.
It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Terrorism
10 pm
The Minister of State, Home Office (Mr. David Waddington): I beg to move,
That the draft Prevention of Terrorism (Temporary Provisions) Act 1984 (Continuance) Order 1985, which was laid before this House on 12th February, be approved.
It is only 12 months since the present Prevention of Terrorism Act completed its passage through the House after the most careful study and detailed debate of its provisions. Year by year the Act it replaced had been scrutinised and reviewed, and that scrutiny was entirely right and proper as is ours now because the powers that have been given to the police and to Ministers since the first Act was passed in 1974 are wholly exceptional and represent a very considerable infringement of the civil liberties normally enjoyed by individuals in this country. This has been said many times over the past 10 years by successive Ministers. It remains true: but sadly it also remains true that terrorism is a menace to our society and the need for legislation is as great as ever.
It has become the practice in these debates to survey the incidence of terrorism in the previous 12 months and draw attention to the worst and most bloody examples. This year it is hardly necessary to do so. The bombing of the Grand hotel, Brighton on 12 October filled us all with a particular horror and outrage. That outrage was shared by the country as a whole because the Brighton bomb was intended to strike a grievous blow at the very heart of our constitution and our democratic system. My right hon. Friend has already informed the House of the results of Mr. John Hoddinott's inquiry into the security arrangements at Brighton and of the measures we are taking to look closely and urgently at the security requirements of similar events in future. But while all sensible safeguards will be applied we can say to the terrorists now that whatever foul deeds they perpetrate, however vile their acts, we shall not play into their hands by changing the way in which government is carried on in this country, with Ministers not only accountable to Parliament but accessible to the public.
There have, of course, been other terrorist incidents in the past year. Despite the successes of the security forces, the terrorist groups concerned with Northern Irish affairs have remained active, particularly in the Province itself. Over Christmas and the new year a series of arrests on Merseyside and elsewhere attracted considerable attention from a number of hon. Members and from the press. The House will be aware that six people are now awaiting trial for conspiracy to cause an explosion; and it would not be appropriate for me to comment on their cases further.
A significant change in the 1984 Act was the explicit extension of the powers of arrest and extended detention to those involved in international terrorism. It was very soon made clear how necessary that extension was and how truly international the threat from terrorism has now become. Within weeks of the passage of the Act, WPC Yvonne Fletcher was shot down in St. James's Square, in an appalling instance of brutal and futile violence.
When the 1984 Bill was going through Parliament Members of this House and another place were rightly concerned about the enlargement of the scope of section 12. The House will recall that my right hon. Friend gave a firm assurance that chief officers of police would be
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advised that the powers in respect of international terrorism should be used only where there was a prospect of a criminal charge in this country or of action under the Immigration Act 1971. I hope right hon. and hon. Members will have been reassured by the statistics that have been published on the use of this new power. In the period from 22 March to 31 December 1984, there were a total of 44 detentions in connection with international terrorism. In 18 of these cases my right hon. and learned Friend the Home Secretary authorised extensions of detention beyond 48 hours; 13 persons were subsequently deported or removed from the United Kingdom under the Immigration Act and eight others were charged with criminal offences. In only one case in which an extension of detention was granted was the person released without charge and not excluded from this country. I hope the House will agree that those figures suggest a restrained and controlled use of an important power in response to a significant problem.
It would clearly not be in the national interest for me to disclose what it was that each of the 44 persons detained was suspected of doing or planning, or to discuss general trends or patterns of behaviour. But I am absolutely convinced that acts of international terrorism have been prevented from taking place in this country during the past year by police use of the new powers given to them last March, and that it was only by the use of those powers that those acts of terrorism could have been so prevented. Two cliches that are often heard are that we live in a dangerous world and that it is a small world. In the field of terrorism both are very true: violence or political tension in one apparently isolated area can so often explode in murder and destruction on the other side of the globe, in a country wholly uninvolved in the original dispute. We must continue to make it unmistakably clear that we are not prepared for this country to be turned into a battleground for foreign feuds and alien causes.
When the 1984 Act was going through Parliament, we gave a commitment to appoint a person to look each year at the working of the legislation and to produce a report to assist Parliament in the consideration of any order providing for the continuation of the Act. Sir Cyril Philips agreed to undertake that task, and copies of his first report were placed in the Library of the House earlier this week. We would like to record our gratitude to Sir Cyril for the work he has done and for producing, with commendable speed, a report which is both clear and helful.
There is entirely legitimate interest and concern in what is an exceptional piece of legislation; and we hope that this independent view of an area in which security considerations seldom allow the full facts of individual cases to be disclosed will go some way towards allaying that concern. I am, of course, pleased that Sir Cyril is broadly satisfied that the Act is being used properly and I hope that others will draw reassurance from his conclusions. He has also raised a number of more detailed points to which it clearly would not be possible for me to give definitive answers at this stage, but I would assure the House, as my right hon. and learned Friend has told Sir Cyril Philips, that we shall give all his comments the closest consideration.
My right hon. and learned Friend has received a report from Her Majesty's Inspectors of Constabulary on the work of the police operating the port controls provided for under the Act. The report deals with security arrangements and is therefore not suitable for publication, but the

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detailed recommendations are receiving careful consideration, and I can take this opportunity to say a word or two about the inspectors' reaction to Lord Jellicoe's recommendation that all passengers on commercial flights and sailings between Great Britain and Ireland should complete landing and embarkation cards. The inspectors were asked to assess the resource implications of that recommendation, and in the light of their conclusions and the views that have been expressed on the security and other considerations, my right hon. and learned Friend has decided that it would not be appropriate to implement Lord Jellicoe's recommendation, and that in general a more selective use of those cards is to be much preferred. I am sure the House will welcome that because the present system whereby so-called "carding" takes place at Heathrow only in emergencies, but at Gatwick and most other airports the whole time, and at seaports on a selective basis, is a source of considerable irritation and annoyance to travellers.
The draft order that is before the House seeks to continue the Act in exactly its present form for the next 12 months. There is provision in the Act for certain sections only to be renewed and for parts of the Act to be allowed to lapse: and I have no doubt that we shall hear later this evening not only criticism of the Act as a whole and opposition to its continuation, but criticism of particular powers in the Act. I emphasise once again that we draw no satisfaction from the continuance in force, over 10 years after its original introduction, of this emergency legislation. But only 12 months have elapsed since there was the fullest debate and the most painstaking consideration of every line of the legislation. And it is simply too soon, after St. James's square and Brighton, too soon, after a year of tension and terrorism in so many countries of the world, to contemplate any change that might dangerously diminish the ability of the forces of law and order to protect us all against the terrorist menace. We have consulted the police in England and Wales, in Scotland and in Northern Ireland: they are unanimous in their response that the Prevention of Terrorism Act is an essential weapon in their constant struggle against terrorism. The Government are determined to give them the support they need.
Sir John Page: Does my hon. and learned Friend feel that the new initiative in the Council of Europe on terrorism is helpful, and will improve co-operation in the different countries of the Council of Europe?
Mr. Waddington: Of course, it must be helpful for countries to get together and to face together the terrorist threat. There can be no doubt about that.
I ask the House for its support for the renewal of the Act. It is support that I know will not be given lightly and will not be given by any of us without regrets. But it is support that I believe must be given as an unequivocal demonstration of our commitment to this long, thankless, but vital struggle against terrorism.
10.14 pm
Mr. Clive Soley: In this debate, as in previous debates on Northern Ireland when I was a spokesman on Northern Ireland for the Labour party, our hearts and thoughts go out to those whose lives have been lost or torn apart by acts of violence. I therefore gladly
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associate myself with the Minister's remarks about the Brighton bombing and other acts of terrorism that have been carried out primarily by para-military groups in Northern Ireland but also by other groups around the world. There is universal agreement in the House on that point.
I have a minor gripe, although it has major implications for the way in which we conduct these debates. Last year in the other place, Lord Elton gave the commitment that the report by Sir Cyril Philips would be available early enough to enable the House of Lords to consider amendments. We presumed that that commitment extended to this House. The letter sent to the Minister by Sir Cyril Philips shows that that was the intention. We have had too short a time to enable hon. Members to consider the details of Sir Cyril Philips' report and to propose amendments. We have had only two days to look at the report, and I hope that the Minister will take that point on board in relation to next year.
I shall put some questions to the Minister arising out of Lord Jellicoe's review in 1983 of the Prevention of Terrorism (Temporary Provisions) Act 1976. The Minister may not be able to give the answers tonight, but if he can, well and good. If he cannot, I look forward to receiving the answers later.
Lord Jellicoe recommended that section 11, which deals with the withholding of information, should be used only when it was suspected that information was being withheld which could, if revealed, prevent acts of terrorism or lead to the apprehension of terrorist offenders. I understand that that is not mentioned in Home Office circular 26/84, but I should like the Minister to give his opinion.
The powers under section 13 apply to immigration and Customs officers. It is not clear whether that main circular has been sent to those officers. I have the impression that that has not happened, although the document provides guidance on the use of the general powers.
Lord Jellicoe recommended that Ministers should take an active part in ascertaining how far the specific purposes for which an extension was granted have been achieved and should satisfy themselves that people are not detained under the Act for longer than is necessary. To what extent has that recommendation been implemented?
I draw the Minister's attention to the case that went before the European Commission on Human Rights. The commission rejected the Government's argument that the men had not exhausted domestic remedies and accepted the claimants' contention that there is no domestic remedy for violations of the European Convention on Human Rights arising from Prevention of Terrorism Act offences. This is a serious matter with legal implications.
The House should take this Act extremely seriously. I always regret the fact that it comes on for consideration late at night and for a relatively short debate. I shall attempt to take up as little time as possible, but I wish to reiterate some important items.
We all understand the circumstances in which the Act was originally passed. The 1974 pub bombings provided an emotive backdrop.
We must address ourselves to four primary questions. First, does the Act, on the best judgment available, prevent terrorism? Secondly, are the acknowledged—everyone acknowledges them — infringements of civil liberty too great to justify the continuation of this Act in a democracy? Thirdly, is the Act in danger of becoming

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permanent? Fourthly — this question is extremely important—does the Act seriously alienate sections of the community so as to make it counter-productive?
Having lived with the Act for 10 years, and having examined in considerable detail and depth the figures available to us, the Labour party's answer is, first, that there is little, if any, evidence to suggest that it prevents terrorism. The Minister said that many people think that the Act is necessary. Sadly, no one has spelt out why he thinks it is necessary. Secondly, the infringement of civil liberties—especially in view of what I said a moment ago—is too great for a democracy to accept. Thirdly, the Act is in danger of becoming permanent. Fourthly, it is a serious alienation of many people in Britain and Northern Ireland and is, therefore, counter-productive.
I acknowledge, as I know the Minister acknowledges, that whether the Act prevents terrorism is a matter of judgment—we cannot know. What we do know is that the convictions under the Act for terrorism are few in number, and many of them are not serious enough to attract long prison sentences. Indeed, only a few people receive long prison sentences. We must balance the advantage of putting away people who may be a danger with the disadvantage of the alienation that it causes.
The figures that I shall use are up to and including 1984, and have been drawn from both Home Office figures and figures supplied by the Irish Information Partnership, to which I am indebted for the detailed analysis that it has carried out over a long period. In Britain 5,949 people have been detained; for the United Kingdom as a whole — including Northern Ireland — the figure is 10,309. People charged under the Act in Britain number 152, with 22 in Northern Ireland, bringing the total to 174. Convictions in Britain—not only of offences under the Act, but resulting from people being held and then charged either under the Act or under other Acts—total 348.
From those figures it is hard to argue that the Act is preventing terrorism. Of the convictions in Britain—the United Kingdom figures are not available—42 per cent. were charged under the Act for failure to co-operate. I emphasise that because, if it were not for the Act, that would not be an offence in Britain. Every lawyer of any standing acknowledges that failure to co-operate is anathema to anyone who believes in the democratic system and the rule of law. It has always been something that British lawyers have resisted mightily, as have lawyers in other democratic countries.
Does the Act prevent by deterrence? That is the other argument that must be addressed by the Government and others.
The Secretary of State for Trade and Industry (Mr. Norman Tebbit): Is the hon. Gentleman for or against the Act?
Mr. Soley: I am making it clear that the Opposition are against the Act. We have consistently voted against it and will continue to do so.
Mr. Tebbit: Shame.
Mr. Soley: I am sorry that the right hon. Gentleman takes that view. I understand his feelings and those of many other people. However, I would not have taken the interest that I have taken over the years in Northern Ireland
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affairs if it was not for my horror at the violence resulting from the problems there. No one —but no one — will take away from me the right not only to feel deeply about that, but to follow through those feelings into rational, political arguments that are designed to clear up the problems which are causing us so many nightmares, and which in particular have caused so many nightmares for the Secretary of State for Trade and Industry.
Mr. Peter Bruinvels: Renewing the Act tonight will save lives.
Mr. Soley: The hon. Gentleman mutters and shakes his head, but there are many problems because of this Act. It has added to the number of people who are prepared to support the primary para-military groups in Northern Ireland. I shall give the hon. Gentleman evidence to back that if he will only contain himself and listen to the argument instead of flying off the handle and assuming that he knows the answer to these difficult problems when, in fact, he has only attended the House for occasional aspects of the debates on Northern Ireland and terrorism.
The other argument is that of deterrence. There is very little evidence that the Act works as a deterrent. The sentences which follow a normal conviction for murder, attempted murder and conspiracy to cause explosions would continue to exist without this Act. If those sentences do not deter, there is overwhelming evidence that the convictions and sentences arising from this Act would be no greater a deterrent than the one which already exists — unless we are arguing that random arrest and detention is itself a primary deterrent.
If that is what we are saying, two things follow. First, we must recognise that we are using random arrest, detention and questioning as a way of obtaining information. Secondly, we must recognise that this method of doing so alienates so many people that it acts as a recruiting sergeant major for the para-military groups in Ireland.
Mr. Waddington: It is quite obvious what the feeling is on the Conservative Benches. It is quite outrageous to talk about random arrests. The hon. Gentleman served on the Committee which studied this Bill, and he knows perfectly well that there is no question of random arrests.
Mr. Robert Parry: My hon. Friend the Member for Hammersmith (Mr. Soley) is correct. It drives innocent people into para-military organisations. Over the Christmas holiday, two seamen sailing from Dublin to Liverpool, who had obviously had a drink too many, gave false names. In fact, one said that he was Mickey Mouse. The police detained them throughout the Christmas holiday, and the Home Secretary allowed these innocent people to be detained for seven days. The Government are driving such people into para-military organisations.
Mr. Soley: My hon. Friend is right, and I intend to give further evidence.
Before I do, I should like to make my position clear. I have been involved in these debates since about 1980 when I first began to get involved. This is the first time that we have had such outbursts from Conservative Members. I understand their strength of feeling following Brighton, but I ask them to understand the strength of feeling which got me involved in the politics of Northern Ireland because of the violence and what it was doing to

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our democracy. If Conservative Members do not understand that, I am sorry. If they are now behaving in this way because of Brighton, whereas previously they did not—[Interruption.] If the hon. Member for Leicester, East (Mr. Bruinvels) would keep quiet and think for a moment, he would not get into such a state. If Conservative Members are doing so, the para-military organisations in Northern Ireland which conduct these atrocious acts will gain courage and advantage from it.
We have a duty to everyone—to the Secretary of State for Trade and Industry and to the many people in Britain and Ireland who have lost their lives and who have had their families torn apart. We owe it to them to engage in a rational, careful and caring analysis. If Conservative Members do not think I am doing so, that is fine, but they should listen to the arguments and put forward the alternatives. They should not take off and get agitated, as if emotion alone will solve this problem. If emotion could solve the problems of Northern Ireland, we would have solved them years ago.
Are civil liberties being infringed too much? I am troubled about the wording of the Act. As I said time and again in Committee, the exclusion order is, in fact, internal exile. We must acknowledge that. The purpose of the Act is the collection of information. We should also acknowledge that. It enables the authorities to pick up people whom they have reason to believe have Irish connections. It allows the authorities to question them, particularly those who have had contacts with other people known to the security services. By doing so, it allows the authorities to paint a picture of the lifestyle of the people in whom they are interested, not of the ones whom they have picked up.
I shall return to the alienation involved in that, as it is an important part of the argument. In normal circumstances we would be appalled by the power to detain a person for up to seven days, in many cases without contact. Regarding abuse, I ask the Minister to read the article by Joe Sim in the New Statesman of 22 February 1985, to cut down my remarks and save time. I could give many examples and the Minister also knows of many, otherwise he would not have made his comments about the infringement of civil liberties. He must take that on board.
We are arguing that the ordinary law should be and is sufficient. It is in danger of becoming permanent. Although it is written into the Act that it will expire after five years—that was a good inovation—in Committee the word "temporary" was to be dropped. Only the amendment tabled by the right hon. Member for South Down (Mr. Powell) and supported by the Labour party reinserted "temporary". The Act has been on the statute book for 10 years. The level of violence in Northern Ireland is the lowest for 14 years—we take pleasure in any small mercy. How much longer will we keep the Act on the statute book? From the Minister's remarks about overseas terrorism, it sounds as though he thinks that the Act must become permanent to deal with overseas groups. Until the last two years, no one ever said that the Act was necessary for that. We have always accepted that the conventional law combined with the powers of immigration officers through the Minister were sufficient to deal with overseas terrorism. No one who considers the matter could come to a different conclusion.
The alienation factor is crucial, and I wish to address my remarks to it carefully. The philosophy of terrorism is
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to try to force Governments to take extreme action which alienates those groups which the para-militaries seek to represent. R. Moss in "Urban Guerilla Warfare" said:
"From its original role of keeping the peace between the Catholic and Protestant communities, the British Army moved over to an offensive intended to root out the IRA as a fighting force. Although the new tactics produced military results, they helped to polarize opinion in Ulster and enabled Catholic critics to represent the army as a repressive force. In this sense, IRA terrorism succeeded. It led to a situation where the British Army, which began as the referee between the two communities in Ulster, appeared as a party to the quarrel. The chaos it engendered helped to postpone the application of social reforms designed to get to the root of the problem and thus eroded Catholic faith in solutions within the existing framework."
Many people are unaware of a booklet which has filtered through the para-military groups throughout the world, including the Provisional IRA. It is Carlos Marighella's "Minimanual of the Urban Guerilla." In many ways it is a shocking document, but Conservative Members should read it. He states that a Government have no alternative except to intensify repression because of a para-military group. He states:
"The police networks, house searches, arrests of innocent people and of suspects, closing off streets, make life in the city unbearable … The people refuse to collaborate with the authorities, and the general sentiment is that the government is unjust, incapable of solving problems".
Those thoughts are not academic, but real. They have been a strand of para-military thinking for hundreds of years, but have been more explicitly put during the past 30 years.
Sir Cyril Philips, among many others, recognises the problem when in his report he says:
"There is too the practical consideration that in containing terrorism the police need is not only special powers but also the support of the public. It is therefore vital that the use of such powers should not alienate any section of the law-abiding population in Great Britain or Northern Ireland."
I shall give an example of the way in which that can work. Incidentally, I welcome the Minister's comments on the carding system. To demonstrate what has been going wrong, I shall quote paragraph 37, which states:
"In one police force area where total carding is undertaken it is also the practice to follow up the information contained on each card by visiting persons with an apparent Irish connection, and asking them to complete a form containing full details of families and friends. The purpose is apparently to obviate the need for further checks when anyone so listed travels. In the force area in question the total number of people affected is small. This practice seems to me objectionable because it uses controls as a matter of routine surveillance which are intended principally to assist in identifying suspected terrorists who are entering or leaving the country."
That is an example of the way in which the Act goes badly wrong and alientates many people whose co-operation and support we seek. The Federation of Irish Societies, which speaks for many Irish people and people of Irish descent in this country, says that a lot of people see it as discriminatory against Irish citizens, and as divisive and threatening with respect to the Irish community. But, above all, in Britain, 5,482 people were released without charge out of a total detained of 5,949. That represents 92 per cent. of those detained. Conservative Members should bear in mind that it is not just those who are released and who are acknowledged to be innocent who are alienated, but above all their families and friends. Hon. Members should also bear in mind that alientation can take several forms. First, as I know from the evidence, it can lead people to tolerate or to give passive support to the para-militaries. People are also frightened to co-operate with the police.

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When I first became involved in Ireland, people said that it was because there were many Irish voters in my constituency. I am sure that many of my constituents have Irish links, but it is a singularly unpopular issue to be involved in generally, because many Irish people say, "Whatever you do, don't bring the problem over here." When I question them further as to their worries, I find that they are worried either about the para-militaries or about being picked up and questioned by the security forces. They frequently quote the Prevention of Terrorism (Temporary Provisions) Act. Although one may need to ask the right questions to discover that anxiety and fear, it becomes clear very quickly. Alienation can also lead to covering-up for para-militaries. I know that that has been happening in Northern Ireland. Most importantly, some people become willing to join, and actively support para-military groups.
It is our contention that that judgment outweighs any other judgment on the other side, that the Act's existence prevents terrorism. Thus, on rational grounds, and on an analysis of the facts available, we say that the Act has not succeeded in its primary purpose, and that there is overwhelming evidence to support that view. There is little evidence to support the opposite view, but I should be happy to hear it. This Act, along with the Northern Ireland (Emergency Provisions) Act — where we do not recommend immediate repeal, as that is not possible, although we recommend major changes to it—form the pinnacle of the anti civil rights legislation that we have allowed to creep on to the statute book over the years.
We must all bear our responsibilities in that regard. We have allowed that to happen, not least because we have failed to respond properly to the problems of Ireland, and to British-Irish relationships during the past 50 or 60 years. We have a great duty in that regard, and our failing has been visited upon the lives of many people outside the House. That is another reason for saying with absolute conviction that my feelings about this issue are as deep and honourable as those of any Conservative Member who so foolishly and, I believe, wrongly thinks that to vote against the Act is in some way to vote for terrorism.
Old-established democracies are rarely lost overnight. There is a slow erosion of civil rights and then comes a crisis, whether economic, military, mass unemployment or hyperinflation, and people wake up to find that the civil rights that defended them no longer exist. This House, more than any other parliamentary assembly in the world, has that reputation to live up to. We have not lived up to it. Britain is an old-established democracy which has gone dangerously far down the road that I have described. It is not too late to turn back, and in doing that we should not be putting lives at risk. Indeed, we might be beginning to grasp the political problems that we have failed to address in the past.
10.40 pm
Mr. James Molyneaux: The Minister said that the events of the past year have illustrated the value of the Act, especially section 12, which the Home Secretary introduced to deal with international terrorism. The Home Secretary accepted the advice of Lord Jellicoe, who wisely concluded that the relationships between various terrorist organisations required action to provide counter-terrorist forces with sufficiently flexible powers to
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eradicate terrorism and terrorist criminality from the United Kingdom and to enable the United Kingdom to play a significant part in what the Home Secretary called "close co-operation" with other countries. That close co-operation has varied from country to country, and there is considerable room for improvement.
Section 10 gives the Government powers to cope with the vast sums of money at the disposal of terrorist organisations and mentions
"acts of terrorism connected with Northern Irish affairs".
I am struck by the role of the individual in section 10. The onus seems to be put on the bank manager of a comparatively small country branch of a bank. I wonder whether international financing of international terrorism and of Irish terrorism are different and whether section 10 needs to be strengthened to prevent the transfer of large sums from country to country and from one major bank to another within the United Kingdom.
I am sure that, in the aftermath of the Brighton bombing, even the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley) agrees that we need the Act. In justification of the original Act, which the Labour Government introduced in 1976, he said—I hope that the right hon. Gentleman agrees that his words are relevant today:
"the necessity of protecting the law-abiding majority of Irish citizens living here by demonstrating that the tiny minority of terrorists who lived amongst them would be weeded out and treated with no mercy."—[Official Report, 24 October 1983; Vol. 47, c. 61.]
On that occasion the right hon. Gentleman referred to the origins of the Act which was introduced by a Labour Government of which he was a member and said that it seemed right at the time, and perhaps it was right at the time. We do not know whether the right hon. Gentleman still holds that view.
Mr. Soley: My right hon. Friend adopts a very fair position upon it. He voted against it last time and he will do so again tonight. The right hon. Member for Lagan Valley (Mr. Molyneaux) must recognise that this argument is about learning from the experience of the last 10 years. The problem is that the right hon. Gentleman does not want to learn.
Mr. Molyneaux: It would be interesting to know whether the right hon. Member for Sparkbrook wishes to repudiate his own words. What should have led him to believe that terrorists should not be weeded out and treated with no mercy? What has happened in the intervening 10 years to persuade the right hon. Gentleman otherwise?
Mr. Soley: Unusually for the right hon. Gentleman, he is being grossly unfair. My right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) has made his view absolutely clear. He believes, as I do, that acts of terrorism are to be condemned. We should like to catch and lock up those who commit acts of terrorism, but it does not mean that my right hon. Friend has got to vote for this Act, for all the reasons I have given. If my right hon. Friend did not share this view with me, he would not have asked me to be the spokesman against it.
Mr. Molyneaux: The absence of the right hon. Gentleman may be significant, but it is not for me to interpret his absence. I am sure that the law-abiding Irish community who were referred to in the speech of the right hon. Gentleman felt in no less need of reassurance in the

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days immediately following the Brighton bombing. We on these Benches are filled with admiration for the two Front Bench colleagues of the Minister who have not permitted their injuries and their grief and suffering to stand in the way of their duties to this House. Equally I am sure that the thousands of Roman Catholics in the City of Armagh this very week accept the necessity to weed out terrorists and to treat them without mercy when they re-live the horror of last Sunday when one of their own faith was gunned down on the steps of their cathedral — and perhaps also the horror of today when a community policeman in the same county was gunned down by the IRA.
It is in the intervals of comparative and relative calm between such atrocities that society is at its most vulnerable. It is then that the resolve that terrorists should be weeded out and treated with no mercy is weakened. I know that in the House tonight there are hon. Members who would object to the words "treated with no mercy", but, given the vile nature of terrorists, who would say that every attempt should not be made to ensure that at least they are weeded out?
The Act which we are renewing tonight is the weeder. In agriculture, as in horticulture, a careful weeder will always do his best to ensure that the minimum degree of disturbance is caused to fruitful plants. So this Act, in its modified form, has proved its effectiveness in weeding out. Any slight disturbance or irritation caused to law-abiding people either on this side of the Irish Sea or on the other is very small indeed compared to the horrific death and suffering which the weeds would cause if they were left to sprawl unchecked over the entire community. I know that some will demand proof that murder and mutilation have been prevented by the workings of the Act, but as one who has himself been frequently inconvenienced and seriously delayed by the exercise of the provisions of this Act I can only say that I shall willingly tolerate all of that if there is even the possibility that one human body will not end up as bloody pulp in a plastic bag.
Successive Governments over the past nine years have taken the view that the retention of the legislation is necessary as long as a substantial terrorist threat remains, to use the words of Lord Jellicoe. For those who take a different view, and who mistakenly believe that the legislation feeds terrorism, I have some words of encouragement.
In September 1983 I said that the security situation could look very different in 12 months' time, provided that terrorists were deprived of the hope of attainment of their objective of a united Ireland. For years, terrorists were not deprived of that hope, because successive Governments kept repeating the declaration that a united Ireland would not be achieved by violence. That suited the terrorists very well. for as long as people in Northern Ireland were to be deprived of the right of self-determination decades in advance of the time when they might willingly consent to a change, there was every incentive for the IRA to secure for itself a dominant place in the new order. I had to wait more than 12 months for terrorists to be deprived of that hope, for it took 15 months for the Prime Minister to transmit the signal for which we had hoped and which the IRA dreaded.
When the Prime Minister, on 19 November 1984, rejected the three options designed to override the free choice of the people of Northern Ireland, she made it very
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clear that the principle of self-determination would prevail over both murder and political intrigue alike. In plain terms, the shared objective would not be achieved by either method.
On 19 November and on subsequent days we were warned and we were told that Republicans would be outraged, that alienation would be increased, and that Ireland North and South, would be convulsed in a bloodbath the like of which had not been predicted since the then hon. Member for Belfast, West — now Lord Fitt —warned us that when the Labour Government decided to provide Northern Ireland with equal and fair representation in this House, there would be a similar outbreak of violence. But in both cases the opposite occurred.
In the recent case, after about 10 days of ritual huffing and puffing, until about the beginning of last December, a surprising calm set in in Northern Ireland. Far from being apart, the two sides of the Northern Ireland community began to come together and to co-operate in all sorts of ways. I know that I am excluding the hon. Member for Foyle (Mr. Hume), because he has clearly decided to go on an alternative course. Bearing in mind the company that he is proposing to keep, I can only say "Good luck" to him.
The general attitude was and still is, "Well, now we know. There is not going to be a change so we might as well get down to making the best of it together." One can imagine the impact of that grass roots philosophy on the self-styled army council of the Provisional IRA. Now it, too, knows that the objective is not going to be achieved by anybody.
No one in his right mind would venture to predict when murderers will stop murdering, in this nation or in any other land, but of one thing we can be certain. The stability created by the Prime Minister's unambiguous declaration makes life very hard indeed for thugs, for normality is their greatest obstacle, and it is slowly dawning on them and on their fellow travellers that although they can kill and be killed, that which they regard as the prize is now set far beyond their reach. Provided that this time they are deprived of a rescue brigade in the form of a weakening of Parliament's resolve, or a let-up in the pressure upon the terrorist organisations, I think that all of us on each side of the House can look forward to the time when this now essential legislation can be set aside.
10.55 pm
Sir John Biggs-Davison: Sir Winston Churchill described this as the terrible 20th century, and as far as the closing years of the century is concerned it seems to be a terrorist century. The debate has been dominated by Irish terrorism, but of course the IRA and the INLA are part of an international mafia of terror. Groups in different countries have widely varying ideologies but they do jobs for each other and they minister to each other's needs in terms of arms, explosives and training.
So I was very glad that my hon. Friend the Member for Harrow (Sir J. Page) intervened in the Minister's speech to emphasise the need for closer European and wider international co-operation. This order is concerned with the situation in the United Kingdom, and we need this order. We need, unfortunately, in this exceptional situation, exceptional methods and measures.
I was very glad to hear the opening words of the hon. Member for Hammersmith (Mr. Soley), expressing his abhorrence of terrorism. If we will the end of safety of life

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and limb and property, we must be prepared to will the means. I cannot share the sympathy that has been expressed tonight—not for the first time—with one who ended up in confinement, having given a false name and failed to give any co-operation to the police. I am very sorry that he missed his Christmas, but other people died at Christmas.
Of course, this kind of legislation is repugnant, and I assure the hon. Member for Hammersmith that it is repugnant to Government Members too. Nor does the House in general deal with this kind of legislation lightly. It seems that we are constantly reviewing and renewing this legislation. We are jealous of civil liberties, but without life what is liberty?
This Prevention of Terrorism Act, as the Minister said, has been scrutinised and reviewed. I only regret that I have not yet had the time or opportunity to study fully the report of Sir Cyril Philips. It has been well pointed out by the right hon. Member for Lagan Valley (Mr. Molyneaux) that this legislation is not the product of a Conservative Administration.
Mr. Dennis Canavan: It is Jenkins' legislation.
Sir J. Biggs-Davison: Exactly—I am very grateful to the hon. Gentleman. It is the product of a Labour Home Secretary, and the fact that he is now a member of the Social Democratic party is beside the point. This is a measure that then carried the support of all sides of the House. It was introduced by a Labour Home Secretary. His judgment then was sound. The views of chief officers of police were then taken, and those views have not changed. We would be very foolish indeed to disregard those opinions.
The question of carding has been mentioned in this debate by more than one hon. Member. It was the only part of the speech of the hon. Member for Hammersmith with which I agree. This does arouse resentment among the Irish and other people. It is important not to alienate those whose support, sympathy and co-operation is needed. But all Irishmen are not as he describes them. Unfortunately the IRA is organised in this island. I have been in pubs where there have been collections for the IRA. It is against the law. Therefore it is necessary sometimes for some Irish people to be troubled.
The great thing is that relations between Irish people and British people in this island are so good. Despite the atrocities that occur, there is no revulsion against Irish people as a whole. But there are some Irishmen who, unfortunately, must receive the attention of the police. My answer to the resentment that is caused by carding is that there should be identity cards for all, without discrimination. Some of us raised this issue when we were debating personation in Northern Ireland elections. We took the view that it was a way of dealing with that problem. This is the way to deal with so many problems. I should be grateful if Home Office and Northern Ireland Ministers would give some consideration to our suggestions from time to time.
I shall draw my remarks to an end, as time is short. I thought that the hon. Member for Hammersmith was not as charming this evening as he usually is. He seemed to be reading us a sermon. He was a bit patronising and prissy this evening. Some of us have been studying Northern
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Ireland affairs for some years. Some of us have even studied the sacred books on guerrilla warfare which he mentioned, such as the works of Marighella, Che Guevara, Mao and the rest. Some of us have engaged in a little study of these matters.
The speech of the hon. Member for Hammersmith and the decision of the Opposition to divide the House on the motion cause me much regret. I believe in constitutional government and a responsible, loyal Opposition. That is the basis of our democracy. What the hon. Gentleman has said and what the Opposition propose this evening are further proof that the Labour party has abandoned the path of responsible opposition and the role of alternative government.
Several Hon. Members rose—
Mr. Speaker: Order. The debate must end at half-past eleven and many right hon. and hon. Members wish to participate in it. I ask the House to follow the excellent example of the hon. Member for Epping Forest (Sir J. Biggs-Davison).
11.3 pm
Mr. Martin Flannery: Despite the brief speech of the hon. Member for Epping Forest (Sir J. Biggs-Davison), I am sure that we have all noted that once again the serious problem that is before us is being debated late at night. The debate is too brief and too late. We are not able to deal adequately with the issue. It is clear that there are profound differences between us, and that is why there will be a Division. Those who are new to these debates will, I am sure, agree with me that it is easy in this place to air our prejudices. I hope that they will appreciate that to do so has an impact in Northern Ireland. Therefore, we should be careful about what we say.
The renewal of the 1984 Act was not expected until March, and it is unfortunate that the debate is taking place today, 21 February. Many Irish associations, individuals and organisations had decided to lobby the House in March but — [Interruption.] It is obvious that Conservative Members think that it is wrong to lobby the House. They do not really understand the serious problem that we are facing. They should appreciate that people have a right to come to this place to talk to Members about their feelings and about what is happening. The Irish community on the mainland has about 750,000 members. It includes those whose connections with Ireland are not those of individuals such as myself, whose families have been here for over 100 years. It includes those who have come hear from Ireland in recent years. The Federation of Irish Societies has profound feelings against the Act and Conservative Members should understand that. It feels that it bears down on them in a terrible way.
My hon. Friend the Member for Hammersmith (Mr. Soley) said that none of us wants anyone to be terrorised and hurt. At the same time, we want it to be understood that there are two sides to the debate. There are honourable differences and it does not pay anyone to laugh as though such feelings did not exist and the subject was not serious. We believe that the Act is misplaced and that the ordinary criminal law could deal with the problems that face us.
I understand that the Philips report is now available. I did not know that, and it appeared that the right hon. Member for South Down (Mr. Powell) did not either.

1313
Many of us would have appreciated the chance to read the report prior to the debate. That was one of the reasons that caused me to think that it should have taken place at the normal time.
It is less than a year since the new Act came into force. The Federation of Irish Societies has sent documentation to all my hon. Friends and to me; I do not know whether it sent any to Conservative Members. It is the largest and most representative Irish organisation in Britain. It feels deeply about the legislation. It is worth considering why; it gives us some insight into what the Irish people here think about the Act.
We all deplore the killing and bombing that have gone on. None the less, we have to reach some kind of unity to try to solve this terrible problem. The Federation of Irish Societies believes that the Act is unnecessary and discriminatory, is divisive and threatening towards the Irish community and Irish citizens in this country, curtails civil liberties and is a constraint on legitimate political expression and activity. If the Act remains on the statute book, the federation would like some changes in it. Its requests embody its fears about what it thinks is wrong with the Act. It requests:
"That detainees be given immediate access to legal advice."
They do not have that. The federation also says that the Irish embassy should be notified when one of its citizens is arrested. It requests:
"That relatives of detainees be immediately informed of arrest and location of the detainee.
That detainees should not be held for more than 48 hours without being brought before a Court or a Justice of the Peace sitting in camera."
Another request which most of us should agree with is:
"That detainees not charged be compensated for 'social injury' defined as loss of reputation, loss of occupation/employment, domestic disturbance and community stigma …
That detained persons should have all rights and privileges generally afforded to unconvicted persons who are detained under the normal law."
The federation wants the ordinary judges rules to apply, and the withdrawal of the power to stop travellers at random without reasonable suspicion. All those requests are reasonable. They come from people who are fearful. They feel that they have been driven into an impasse because of this Act.
Mr. Canavan: Does my hon. Friend accept that one of the most damning statistics in the Philips report is that more than 70 per cent. of the people who were arrested and detained under the Act were never charged? In other words, the Act is being used as a system of repression against innocent people.
Mr. Parry: I fully agree with the points that my hon. Friend has made on behalf of the Federation of Irish Societies. Does he also agree that when innocent people have been detained and then released without charges being made any fingerprints that have been taken by the police should be destroyed?
Mr. Flannery: Of course I agree with my hon. Friend. By the way, my hon. Friend the Member for Falkirk, West (Mr. Canavan) says that the percentage he gave should have been 80, not 70.
The present Act has so consolidated the provisions of the previous legislation that it seems that we accept that the position will remain the same for ever. Effectively this exceptional law enlarges the circle of people whose civil liberties and legitimate political activities are constrained and threatened.
1314
I was a member of the Committee which considered the 1984 Act. Labour Members fought strenously not only against the whole Bill but against the widening of the provisions. Arrest and detention powers were extended to cover international terrorism. I do not believe in the links that have been mentioned in the debate. When people are giving bombs to other people, they do not necessarily share the same ideals. Often they are opposed. There are no direct organisational links; there may be sporadic links.
The draconian powers of the Act hang like the sword of Damocles over the Irish community in this country. We, like Conservative Members, will fight tooth and nail to prevent bombs from exploding in the community because they harm all of us.
However, at any fixed moment, those of us in the Labour party who are deeply involved—and have been for years—are always trying to handle cases of people suddenly arrested without charge. My hon. Friends, wherever they may be, know about names such as Maire O'Shea, about all sorts of people who are being arrested and whose relatives get in contact with us asking us to do something. When we are in the process of doing it, those people are released, probably with a stigma. New names then come to us. That is going on all the time, as my hon. Friends would tell the House. People are taken from their homes and letters from relatives arrive asking us to deal with that. We hear of cases in Northern Ireland when people are killed by plastic bullets. All come to us to ask us to try to do something about it as best we can.
Innocent and orderly people are treated as criminals and then released without charge, with no compensation, but with a lingering stigma. They are shocked and terrorised and wonder what in heaven's name is happening to them in what must appear to them to be a nightmare of 1984 proportions.
One could develop that theme, but I should like to conclude by talking a little politics because there is an idea that the whole thing is hopeless. Most of us in the Chamber have debated the Act and its draconian sister, the Northern Ireland (Emergency Provisions) Act, until a curious bond seems to exist between us. It is a strange thing, and I have tried to analyse it, and failed. I have often tried. But one thing is sure. We are permeated by its main components of intractability and sheer hopelessness. I have said over and over again that the sense of hopelessness proceeds from the fact that all that we talk about is security, and we never discuss what is the cause of the terrible problem that we all face together. That is why the Emergency Provisions Act and this Act will go on for ever if we do not discuss the root cause of why that is happening.
There is among us a dangerous acceptance of the permanency of the situation. We accept one another's position, and the two sides never discuss the politics of the situation except separately. The words "political initiative" have become dirty words instead of something that we want to do. There seems to be no meeting point at all. I cannot accept that, as I cannot accept this unjust Act. The emergency has gone on longer, much longer than both world wars put together, and the Boer war thrown in. Are we so powerless that we are all accepting defeat? I do not accept defeat, and meanwhile the situation that we have created between us inevitably spawns more violence.
I believe that ultimately the Unionists will have to accept their essential Irishness and be part of a united Ireland. The only way that the Emergency Provisions and the Prevention of Terrorism Acts will be unnecessary will

1315
be in a democratic and united Ireland living in peace and friendship with its neighbour, Britain. Some time, some day, we shall have to sit down and talk together. The British and Irish people are tired of an enduring slaughter that appears to be endless. They will ultimately demand that we do something. Our prejudicies are too luxurious and expensive. We shall have to act in unison for peace, and we shall not do so by passing the extension of the Act every year, as well as of the Acts kindred to it.
Mr. Mark Carlisle: I am as concerned about and as interested in the interests of individuals and their civil rights as anybody else in the House. I spend part of my time, or much of my life, as a barrister in the criminal courts, defending various people. But I equally believe that internaional terrorism is one of the major concerns that this country faces today, whether it comes from the acts in Northern Ireland or acts in the middle east.
I should like to make it clear what the order which the Opposition announced they propose to oppose again today, does. It does three things. It proscribes certain organisations, gives power to exclude people whom the Home Secretary has reason to believe are involved in terrorist offences and gives power to arrest and to question people whom the police have reason to believe are involved in the commission of criminal offences. Those are minimum powers, which we are justified in taking in defence of our nation and the people of this nation.
As has been said, the Prevention of Terrorism (Temporary Provisions) Bill was introduced 10 years ago by a Labour Home Secretary. I do not believe that there have been any changes since then which mean that this legislation is less necessary today than it was 10 years ago. I should have thought that what happened in Brighton and in other parts of the world—with international terrorists wishing to make the streets and cities places to use their bombs to promote their causes—has made it clear to every hon. Member that the Act's limited powers are still necessary. I am satisfied by the assurance of my hon. and learned Friend the Minister of State that the police have made it clear throughout that they believe that these powers assist them in their fight against terrorism. I am sad that, yet again, the Opposition are choosing to oppose this measure.
11.16 pm
Mr. John Hume: I do not intend to discuss the atmosphere that has given rise to terrorism and violence. If I were to do so, I would have harsh things to say about the House and its neglect over a long period in upholding democratic principles in Northern Ireland.
The Minister rightly said that the Prevention of Terrorism (Temporary Provisions) Act 1976 represents a considerable infringement of civil liberties, and I welcome his recognition of that fact. The Home Secretary who introduced this measure described it as draconian. In that case one would expect that the Government would welcome serious questioning of the Act and that we would have had more time to debate it and more notice of when the debate would take place. What we have been given as a review of the Act during the past 12 months is an insult to the intelligence of the House. The person who carried out the review did so in only three weeks, according to his
1316
letter to the Home Secretary. He started his examination on 7 February and finished it on 15 February. How could a review of what is described as a considerable infringement of civil liberties be conducted in such a short period? The man who conducted the review did not consult, nor did he invite consultation, with, the responsible organisations which represent the Irish community and which are at the receiving end of this legislation.
The Minister questioned my hon. Friend the Member for Hammersmith (Mr. Soley) when he talked about random arrests. About 84 per cent. of the people arrested under the Act are not charged with any crime. That is surely evidence that some random arrests are carried out. If people are arrested, that fact becomes publically known. If they are innocent, serious damage is done, even to the point of being made targets for an assassin's bullet. That is why we should seriously consider the operations of the Act.
No notice is required to be given to the relatives of any person arrested under the Act. A person could disappear off the face of the earth for seven days, and no one would know where he was. Under this Act, no one has any responsibility to tell his relatives about his arrest. That is a serious infringement of civil liberties. The simple answer is to create machinery to enable relatives to be informed of where their relations have been detained and to give the arrested person immediate access to a solicitor or other legal advice. What is the objection to doing that?
Frequent complaints have been made about the conditions in which many of these people—the vast majority of them innocent—have been held in custody. The Jellicoe review recommended that because of the Act's "draconian" —I use the review's word—native citizens detained under it should be, and should be seen to be, well treated. Will the Minister examine the conditions under which people have been held?
11.20 pm
Mr. Peter Robinson: This debate has become predictable. All too often, I recall the hon. Member for Hammersmith (Mr. Soley) lecturing hon. Members—especially those on the Government Benches—on approaching the matter with a cool mind. On a day when a Roman Catholic policeman has been butchered in Northern Ireland, following a weekend when a Roman Catholic prison officer was butchered coming from Mass, it is hard to isolate oneself from the emotions naturally provoked when we discuss terrorism.
As a constituency representative in Northern Ireland, I have lost too many friends and buried too many constituents to be removed from the emotional aspects of the Act. The hon. Gentleman has no difficulty about being passionate about housing, poverty or economics, so it ill becomes him to tell us that we should not be passionate when talking about the lives and deaths of people in this country. It is, rightly, an emotional matter. It is of prime importance to every citizen in this country. I have no doubt where my loyalties should lie—it is with those who could be done to death by acts of terrorism if it were not for the security forces being strengthened by the provisions contained in the Act.
It is the same sort of logic adopted by the party of the hon. Member for Foyle (Mr. Hume), which says that the RUC and the UDR should be disbanded, to leave the field free for the IRA all the easier to carry out its acts of murder

1317
and mayhem. It is the IRA which is most vociferous in its opposition to the Act. Does it not say something about the nature of the Act when the terrorist organisation wants it done away with?
The hon. Member for Hammersmith might say that the Act alienates some sections of the community. The Act does inconvenience many people — it inconveniences me. But, as a citizen who believes that terrorism must be put down, I am prepared to put up with that inconvenience if it helps some to live who might otherwise not live.
It is essential to put on the record the fact that the Minister has made it clear, and the security forces have made it clear, that the need for this legislation is as great as it ever was. When Labour Governments are prepared to take that advice from the security forces, it is strange that this Labour Opposition are not prepared to take that same advice from the same security forces.
There has been a significant act by the Government of the Republic of Ireland, and it should be taken into consideration. Any assistance that we can obtain from that Government in the fight against terrorism is to be welcomed. They took speedy action to seize funds that would have been used to buy guns, bullets and bombs in Northern Ireland. It is a step in the right direction, and we obviously look for more from that Government. While the Act is required, it must be supported by all right-thinking people.
11.23 pm
Mr. Waddington: With the leave of the House, Mr. Speaker. I hope that hon. Members will acquit me of discourtesy if I do not deal with too many of the detailed points raised in the few minutes remaining to me.
The hon. Member for Hammersmith (Mr. Soley) raised some important points. The Home Office circular to the police includes a careful explanation of the provisions of section 11. There have been no charges under that section since the Act came into force. On section 13, the circular does not go to immigration officers. Although it is rare for them to act as examining officers, nevertheless separate guidance is being prepared for them.
The right hon. Member for Lagan Valley (Mr. Molyneaux) mentioned the recent events in Ireland and questioned the adequacy of powers to control the movement of terrorist funds. The Government are certainly conscious that events in the Republic earlier this week make it necessary for us to consider our own powers. Section 10 has a far more limited purpose, and is not adequate to deal with the sort of situation which the Government of the Republic dealt with.
My hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison) mentioned identity cards. This has been debated on numerous occasions. I can see the force of what he said, but our advice is that it would not be very useful. When identity cards were abolished in 1952, the view of the police then was that they were no longer helpful, and I gather that the view of the police today is no different.
The hon. Member for Sheffield, Hillsborough (Mr. Flannery) said that there should be immediate access to legal advice for those detained under these powers. Under the present arrangements, access to a solicitor in England and Wales is governed by the provisions of the judges' rules and administrative directions to the police. These apply to those detained under the prevention of terrorism legislation in exactly the same way as to people in custody under other powers.
1318
My right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle) highlighted the fact that the police want these powers. That is indeed true.
Mr. Tony Lloyd rose—
Mr. Waddington: I am sorry, but I must continue as only four minutes remain.
The hon. Member for Hammersmith asked whether the Act prevented terrorism. Clearly, we cannot prove that five more hotels would have been blown up had this Act not been on the statute book during the last year. We cannot prove that more of our colleagues would have been blown up had this legislation not been in force over the years since 1974. But we can exercise some common sense, as can the vast majority of people in this country.
Mr. Lloyd: On a point of order, Mr. Speaker.
Mr. Waddington: The vast majority recognise that the detention of people, in respect of whom there are reasonable grounds for suspecting that they are involved in terrorism, and the exclusion of such people is much more likely to protect the community than harm us.
I was also asked whether the Act annoyed and alienated people in Northern Ireland and the Irish community here. Again, let us keep a sense of proportion. The right hon. Member for Lagan Valley was right. How can we equate the inconvenience suffered by someone held up at a port, or the hardship of being detained for two or even seven days, with the sufferings of the families of those who have been murdered or the sufferings of two of our right hon. Friends? What would people think if this order was not carried tonight? What sort of message would go out from this House? They would think that we had all taken leave of our senses.
I suspect that the Labour party, by opposing the order, has already taken leave of its senses. This Act's predecessor was passed not just by a former Home Secretary who has since left the Labour party, but by a Labour Government. Until only two or three years ago, the Labour party was content to vote for the continuation of these powers year after year. The powers have not changed, and neither has the need for them. The only thing that has changed is the Labour party. It is now demonstrably composed of people, and is represented on the Opposition Front Bench by people, who are simply not fitted to exercise the power necessary for the protection of the people of this country.
11.30 pm
Mr. Robert Maclennan: The Minister's ridicule of the Labour Oppositon is wholly justified. The powers contained in this order are necessary and should be renewed. Regrettably, the Minister did not rely on the report of Sir Cyril Philips, which gave much greater support to the continuation of the powers than he allowed. All that needs to be said about this is what Sir Cyril Philips said: that the conviction of:
"A large number of persons guilty of very serious criminal offences connected with terrorism which in many cases would not and could not have resulted from arrest under other powers"
has taken place as a result of the enactment of this Bill last year. The Government must be supported, and in this year of all years, the alliance offers its support to the Government.
Question put:—
The House proceeded to a Division:—
Mr. Tony Lloyd(seated and covered.): On a point of order, Mr. Speaker. During the Minister's reply he referred to the judge's rules and, I am sure, unintentionally, claimed in a way which misleads the House that there was no difference between the provisions of the Prevention of Terrorism (Temporary Provisions) Act 1984 and those of normal criminal law. I understand that under the Prevention of Terrorism Act a period of 48 hours elapses before a suspect is given access to a solicitor, and that the interview between the solicitor and the suspect can, at the insistence of the police, be conducted in their presence. That is different from what applies under the ordinary criminal law. If I am correct, can the Minister take steps to advise the House what the exact position is?
Mr. Speaker: That is not a matter which I can answer. I am sure that the Minister heard what the hon. Member said. If the hon. Member is correct, I am sure that the Minister will communicate with him.
The House having divided: Ayes 145, Noes 35.

Division No. 123]

[11.30 pm

AYES

Alexander, Richard

Dunn, Robert

Amess, David

Durant, Tony

Ancram, Michael

Eggar, Tim

Arnold, Tom

Evennett, David

Atkinson, David (B'm'th E)

Fallon, Michael

Baker, Nicholas (N Dorset)

Favell, Anthony

Batiste, Spencer

Forsythe, Clifford (S Antrim)

Beggs, Roy

Forth, Eric

Bellingham, Henry

Fowler, Rt Hon Norman

Benyon, William

Garel-Jones, Tristan

Best, Keith

Hamilton, Hon A. (Epsom)

Biggs-Davison, Sir John

Hancock, Mr. Michael

Bonsor, Sir Nicholas

Hawkins, C. (High Peak)

Boscawen, Hon Robert

Heddle, John

Bowden, Gerald (Dulwich)

Holt, Richard

Brandon-Bravo, Martin

Howarth, Gerald (Cannock)

Bright, Graham

Hurd, Rt Hon Douglas

Brinton, Tim

Kennedy, Charles

Brown, M. (Brigg & Cl'thpes)

Knox, David

Browne, John

Leigh, Edward (Gainsbor'gh)

Bruinvels, Peter

Lennox-Boyd, Hon Mark

Burt, Alistair

Lester, Jim

Butcher, John

Lightbown, David

Butterfill, John

Lilley, Peter

Carlisle, John (N Luton)

Lloyd, Peter, (Fareham)

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

McCrindle, Robert

Cash, William

McCurley, Mrs Anna

Channon, Rt Hon Paul

McCusker, Harold

Chapman, Sydney

Macfarlane, Neil

Chope, Christopher

MacGregor, John

Clarke, Rt Hon K. (Rushcliffe)

Maclean, David John

Conway, Derek

Maclennan, Robert

Coombs, Simon

Major, John

Cope, John

Marlow, Antony

Couchman, James

Mates, Michael

Currie, Mrs Edwina

Mather, Carol

Dicks, Terry

Mayhew, Sir Patrick

Douglas-Hamilton, Lord J.

Meyer, Sir Anthony

Dover, Den

Miller, Hal (B'grove)

1320

Mitchell, David (NW Hants)

Stern, Michael

Molyneaux, Rt Hon James

Stevens, Lewis (Nuneaton)

Moynihan, Hon C.

Stevens, Martin (Fulham)

Murphy, Christopher

Taylor, Teddy (S'end E)

Needham, Richard

Temple-Morris, Peter

Nelson, Anthony

Thomas, Rt Hon Peter

Nicholls, Patrick

Thompson, Donald (Calder V)

Norris, Steven

Thompson, Patrick (N'ich N)

Onslow, Cranley

Thurnham, Peter

Oppenheim, Phillip

Townend, John (Bridlington)

Owen, Rt Hon Dr David

Twinn, Dr Ian

Page, Sir John (Harrow W)

van Straubenzee, Sir W.

Page, Richard (Herts SW)

Viggers, Peter

Paisley, Rev Ian

Waddington, David

Portillo, Michael

Waldegrave, Hon William

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

Walden, George

Powell, William (Corby)

Walker, Cecil (Belfast N)

Powley, John

Waller, Gary

Proctor, K. Harvey

Watson, John

Raffan, Keith

Watts, John

Rhodes James, Robert

Wells, Bowen (Hertford)

Robinson, Mark (N'port W)

Wells, Sir John (Maidstone)

Robinson, P. (Belfast E)

Wheeler, John

Ross, Wm. (Londonderry)

Whitney, Raymond

Rowe, Andrew

Wiggin, Jerry

Sainsbury, Hon Timothy

Wilkinson, John

Sayeed, Jonathan

Winterton, Mrs Ann

Shaw, Sir Michael (Scarb')

Winterton, Nicholas

Shelton, William (Streatham)

Wolfson, Mark

Smith, Tim (Beaconsfield)

Wood, Timothy

Smyth, Rev W. M. (Belfast S)

Yeo, Tim

Soames, Hon Nicholas

Spencer, Derek

Tellers for the Ayes:

Squire, Robin

Mr. Ian Lang and

Stanbrook, Ivor

Nr. Michael Neubert.

Steel, Rt Hon David

NOES

Atkinson, N. (Tottenham)

Lloyd, Tony (Stretford)

Banks, Tony (Newham NW)

McDonald, Dr Oonagh

Bermingham, Gerald

McNamara, Kevin

Campbell-Savours, Dale

Maynard, Miss Joan

Canavan, Dennis

Mikardo, Ian

Cohen, Harry

Nellist, David

Corbett, Robin

Parry, Robert

Corbyn, Jeremy

Pavitt, Laurie

Dalyell, Tam

Pike, Peter

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

Prescott, John

Deakins, Eric

Richardson, Ms Jo

Dormand, Jack

Silkin, Rt Hon J.

Dubs, Alfred

Skinner, Dennis

Fatchett, Derek

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

Fields, T. (L'pool Broad Gn)

Soley, Clive

Flannery, Martin

Freeson, Rt Hon Reginald

Tellers for the Noes:

Hogg, N. (C'nauld & Kilsyth)

Mr. John McWilliam and

Holland, Stuart (Vauxhall)

Mr. Allen McKay.

Hume, John

Question accordingly agreed to. Resolved.
Resolved,
That the draft Prevention of Terrorism (Temporary Provisions) Act 1984 (Continuance) Order 1985, which was laid before this House on 12th February, be approved.

PETITIONS

  Torture
  11.41 pm
  Mr. Harry Cohen: With your permission, Mr. Speaker, and that of the House, I wish to present a petition to Parliament that supports Amnesty International's Campaign Against Torture. It contains 1,300 signatures, which were collected by Amnesty International's Epping Forest adoption group. It has handed similar petitions to all Members of Parliament in the locality.
  The petition states:
  To the Honourable The Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament Assembled The Humble Petition of the People of the United Kingdom showeth:

  1) That we wish to register strong support for Amnesty International's Campaign Against Torture and declare our wish to see torture totally eradicated from the world.

  2) That we believe that this end would be significantly advanced if all Governments implemented Amnesty International's 12-point programme for the prevention of torture.

  Wherefore your petitioners pray that your honourable House urges Her Majesty's Government

  1) To support an effective United Nations Convention Against Torture and in particular compensation for torture victims to include anyone who has been the victim of cruel, inhuman or degrading treatment or punishment.

  2) To support proposals both at the United Nations and at the Council of Europe to create an international commission to make unannounced visits to any place of detention.

  3) To intercede whenever and wherever possible on behalf of prisoners being tortured.

  And your petitioners, as in duty bound, will ever pray, etc.
  I share the views expressed in the petition and commend it to Parliament.
  To lie upon the Table.

  Human Embroyos
  11.43 pm
  Mr. Patrick Nicholls: With your permission, Mr. Speaker, and that of the House, I wish to present a petition to Parliament on behalf of approximately 250 of my constituents in the Division of Teignbridge. The first signature on the petition is that of the organiser, Mr. Richard Wills, of 18 Gloucester Road, Newton Abbot, Devon.
  The petitioners aver that the newly-fertilised human embryo is a real living individual human being, and they therefore welcome the statement in the Warnock report that
  "the status of the embryo is a matter of fundamental principle which should be enshrined in legislation".
  They therefore oppose all such practices that are recommended in the report which discriminate against the embryo or violate its human dignity and right to life. They therefore urge the House to
  take immediate steps to enact legislation which forbids any procedure that involves purchase or sale of human embryos, the discarding of human embryos, their use as sources of transplant tissue or as subjects for research or experiment (unless this is done solely for the benefit of the embryo concerned).
  Hon. Members present many petitions. Sometimes we agree with them and sometimes we do not. I support wholeheartedly the sentiments that have motivated the petitioners in this case. They conclude:
  And your petitioners, as in duty bound, will ever pray.
  To lie upon the Table.

  Liverpool
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Garel-Jones.]
  11.45 pm
  Mr. Terry Fields: The purpose of this debate is to cut through the smokescreen of distortions that give the impression that Liverpool city council is responsible for present circumstances in Liverpool. We must consider the background.
  I was born in a dock area before the war. My father was a docker, so I feel qualified to speak on some of the matters on which I hope to enlarge. I remember, as a young person, seeing around the pier head, the goree piazza and the Strand, shackled to the wall, bolts where slaves were tied up in the lucrative trade in human misery. The docks epitomise what is wrong in Liverpool — lack of investment of the profits created by Liverpool people. It is all very well for the Secretary of State for the Environment to talk about us whingeing and whining about our lot, but we are hard working people.
  During the war and the national dock labour scheme from 1947 to 1964, my father used to stand in the pen with other dockers like a choice animal, waiting to be picked out for work. My father was proud, and characteristic of the spirit of people in Liverpool. We had dignity and got through decades of struggle. I have never known anything other than bad housing, high unemployment and lack of opportunity for Liverpool people. However, we have learnt lessons. One is that the ravages of the system to which we belong bleeds working people. Indeed, it is responsible for their death.
  In 1965, the docks employed 13,589 people. That industry today employs 2,086 — a reduction of more than 80 per cent. There have been corresponding job losses in associated industries and services. There has been no let-up in the de-industrialisation of Liverpool. Between 1971 and 1981 the city lost 90,000, or one quarter, of its jobs. Manufacturing jobs have declined by nearly 40 per cent. and blue collar jobs by 30 per cent. Between 1979 and July 1983, 33,220 redundancies were notified by firms in Liverpool. The catalogue of job losses is endless.
  Since 1979, the city has lost one third of its manufacturing jobs and half of the jobs in the city's largest industries—food, drink and tobacco. Between 1975 and 1982, the city council shed 4,400 jobs through natural wastage. The council is now the largest employer on Merseyside, providing socially useful jobs for 31,000 people. It employs one third of all public sector workers in the city. I have a list of 23 industries in which jobs have been lost. They include vehicles, metal goods, coal and petroleum, chemicals, electrical goods, leather goods, clothing and timber.
  The latest figure of unemployment on Merseyside—100,000 — is an obscenity when it represents decent people who are eager to work. When they are provided with jobs by the council, they show that they can work.
  Housing in Liverpool is believed to be among the worst and yet the most expensive in Europe. There are 22,000 people on the council's waiting list for houses. Urgent repairs are needed to 20,000 council houses. Liverpool has the highest percentage of old, privately rented houses in the country, with the exception of London. Its housing investment allocation has declined, in real terms, from £47 million in 1980 to £28 million in 1984–85. But the real
  1324
  decline in its housing investment allocation is highlighted by the fact that the city's allocation in 1980 was half that which it received in 1974. Since 1980 Liverpool has lost £63 million in housing subsidy. In 1980 the Government contributed £20 million to the city's housing services. In 1984 if fell to £5·5 million. The catalogue of crimes against the people of Liverpool goes on and on.
  When the Labour party took control in Liverpool in 1983 we found that it was not only the public sector that had been decimated. The 10 years of decline in Liverpool under the Tories and the Liberals resulted in the axing of 1,000 local authority jobs, with vacancies in the council's establishment being left unfilled, the abolition of the direct labour organisation and the privatisation of certain services which resulted in job losses. This happened at a time when more, not fewer, jobs were needed in Liverpool. The rates increases since 1979 were used to compensate for Tory cuts in grants. None of that money was used for improvements in Liverpool. Liverpool city council could provide no cushion.
  We have come a long way during the 20 months that the Labour party has been in power in Liverpool. We are proud of our achievements. At a time when unemployment is rising nationally, this is no mean feat. The 1983 general election which brought so many Conservative Members to this House has to be set against the Labour victory in Liverpool. It was the Labour party's first victory in Liverpool for 10 or 15 years. That landslide victory was continued in the local authority elections in 1984. Five out of the six Members of Parliament for Liverpool represent the Labour party. For the first time in 120 years there is not one Tory Member of Parliament for Liverpool. It indicates the trust of the people of Liverpool in the Labour party, both nationally and locally. It is proof that a socialist programme is not a liability at either national or local elections, as our opponents would have us believe.
  What is even more important is that it has highlighted the political awareness of the people of Liverpool as a result of the experience of having the city run by Liberals and Tories, of having a Tory Government in power and the defections to the Social Democratic party. The turnround in the fortunes of the Labour party has been an inspiration to the city council and to workers in the Labour movement, both nationally and internationally. An opinion poll commissioned by Liverpool University showed that 73 per cent. of Labour voters, 62 per cent. of Liberal voters and even 48 per cent. of Conservative voters felt that the Government were largely to blame for Liverpool's problems.
  During the last 20 months Liverpool city council has created 1,000 jobs. It has also prevented 1,000 job losses which had been inherited. It has also boosted employment in the private sector. By 1988, 17,000 jobs will have been created by the council's house-building programme and by its provision of sports facilities. There are 136 apprentices, and 100 sixteen-year-olds are on YTS schemes. Their wages have been topped up to £52 a week and they are guaranteed a job at the end of their training. We are introducing a minimum wage of £100 for local authority workers and a 35 hour week. During the last year 1,057 new houses have been built, and a further 1,211 are to be built in 1984–85. We have provided additional nursery accommodation and reorganised education in order to ensure that every child in Liverpool is provided with the best education that is available.

  1325
  What is surprising is that with only 30,000 council houses estimated to be built in England and Wales in 1985, over 2,000 of these will be built in Liverpool—that is, one in 15. It is a testimony to the work that the Liverpool city council is doing and will continue to do, despite the opposition of the Government.
  We are in a crisis in Liverpool at the moment; we face a financial crisis that is worse than last year's crisis. To balance the books we would require 6,000 redundancies or 220 per cent. rate rises. That is because of the 10 years of Tory and Liberal rule. The Government target of spending is totally unrealistic. The Government impose penalties for spending on essential services, and there is a totally inadequate rate support grant. The Government have reneged on their agreements of last July, when the Secretary of State, having toured the city's black spots, said:
  "I have never seen housing conditions the like of those I have seen today."
  Yet our resources for housing have been cut by 34 per cent.
  This year the Tories have set us an arbitrary spending target of £220 million, yet we need to spend £270 million just to defend existing jobs and services. There will have to be a 220 per cent. rate rise or 6,000 jobs will go. Last year the Secretary of State said that it would be impossible to run the city with less than £245 million. With inflation, that would give us this year £255 million. But to maintain that we would have to put up the rates and every time the rates go up money goes off the rate support grant, creating an impossible gap for us to fill.
  Since 1979 the Government have withdrawn £320 million from the city in rate support grant, housing improvement programme allocation, housing subsidy, and education grant. What we are saying in Liverpool is that we want that money back; it is as simple as that.
  We have shown that our policies are working. Continually the Government chide the Labour Opposition with the question, "What did you do when you were in power?" In Liverpool we are creating jobs, we are building houses, we are building schools, and we are giving a high quality of education to people. In all those respects the Government are doing the opposite. We ask the Government to give us credit for having achieved success in creating jobs and for our services in housing and education. The cost of sacking 6,000 men would be felt by the Government in unemployment pay and lost taxes.
  In the Liverpool city centre, 170 of the 680 stores have already shut, more "Closed" signs are going up and, with the rate increases forecast by the Government, more jobs will go in the Liverpool area. In addition to that, we are being threatened by the Government.
  The Secretary of State visited Liverpool in 1984. He gave pledges. In a letter to the leader of the Liverpool city council he said:
  "I can give you an assurance that I will do my very best to ensure your allocations in Liverpool next year under the housing investment programme and the urban programme. Taken together, they will enable the council to make positive progress in dealing with the city's severe needs."
  He said that in Liverpool. He came down to London, reneged on his commitment and denied that he had ever made those statements, and he accuses us in Liverpool of violence. In Liverpool there is a concerted campaign, which includes violence to undermine the council. We say to the Liberals that they must share the responsibility,
  1326
  because they have not been prepared to denounce the violence or to dissociate themselves from those who are perpetrating it.
  Having spoken about what he was going to do in Liverpool, the Secretary of State's latest pronouncement, reported in The Times of 19 February, is an indication that he has firm backing from the Cabinet to take direct action if the Liverpool administration is breaking down. We are well used to threats from the Minister, but this is the second time that the Cabinet have discussed the situation in Liverpool. The first time was in 1981, after the Toxteth riots, when the then Secretary of State, the right hon. Member for Henley (Mr. Heseltine), said that it took a riot to make the Cabinet take the problems of Liverpool seriously. Given the background and history that we have gone through in Liverpool, is that the only language that the Government understand when talking about the problems of places such as Liverpool?
  Perhaps the Secretary of State is envisaging a Molesworth type raid in Liverpool. Perhaps he envisages dressing up in his predecessor's combat jacket. If he comes in the still of the night we shall be ready for him, whenever he comes. Why is he making attacks on us? Why has he launched the so-called investigation into town hall corruption and listed Liverpool as one of the places to be investigated?
  Why was that announcement made? Why is he using the Local Government, Planning and Land Act, with threats of commissioners against us? We believe that this is a pre-emptive strike against the Liverpool city council and the Liverpool people. We also saw at the time he made that statement an announcement of concessions to four other local authorities which had been threatened with rate support grant cuts.
  We have the support of the people of Liverpool, the trade unions and the people on the estates. We have seen the hypocrisy of this Government in this respect. But Liverpool exemplifies, perhaps in advance of other parts of the country, the processes which are taking place in this country today. The elected representatives of Liverpool will not let the people down. They have been let down too often in the past and they deserve better. We are not going to dirty our hands doing the Tories' butchery of jobs and services in an already ravaged Liverpool. As far as the Government's threats are concerned, it will not be dented shields they will have to deal with, because our shields were forged in preparation for the heat of struggle last year and those preparations are going ahead. The Government thought that we would go into battle then. To quote Mrs. Thatcher's soul mate, "You ain't seen nothing yet". Liverpool's people will not be crushed by this or any other Government.
  12.1 am
  Mr. Robert Parry: I congratulate my hon. Friend the Member for Liverpool, Broadgreen (Mr. Fields) on initiating this debate at this late hour. I have deliberately stayed behind to support him. I do not want to repeat the points he has already made because these have been put on record many times in the last couple of years. In fact, during the past six days three hon. Members from Liverpool have raised these matters. Last Friday my hon. Friend the Member for Liverpool, Garston (Mr. Loyden) had the Adjournment debate on the future of the port of Liverpool. Then I raised the question of the Isle of Man-Liverpool crossing, and Monday of this

  1327
  week I made a Standing Order No. 10 application on the proposed loss of 300 jobs at Guinness, Liverpool. Tonight my hon. Friend has raised the general question of Liverpool.
  We are fighting as Labour Members of Parliament for our constituents, our city and our area, and we shall continue to do so. The level of unemployment in Liverpool is merciless and indefensible. My hon. Friend said that more than 90,000 jobs had gone in the last few years. In fact, this Government have hit the jackpot because, with the loss of jobs in Cammell Laird and the Guinness company we have seen over 100,000 jobs go since this Government took office.
  I am the Member for Riverside, which has the highest level of male unemployment in the United Kingdom—nearly 40 per cent. across the board. I warned in the late 1970s and the early 1980s about the problems arising in Toxteth and the grave danger of riots and disturbances on our streets. Unfortunately the warning was ignored and I say now that there will be trouble on our streets again unless the Government take action to reduce the massive level of unemployment. I believe that, as my hon. Friend said, this Government have seen nothing compared with what they will see if they allow mass unemployment to continue in city areas. Therefore, I hope that the Minister can give us some hope that we shall see a decrease in this terrible loss of jobs.
  12.4 am
  The Parliamentary Under-Secretary of State for the Environment (Mr. William Waldegrave): There was a rather telling slip in one of the things that the hon. Member for Liverpool, Broadgreen (Mr. Fields) said — that opponents regard a full-blooded Socialist programme as an election loser. His opponents on the Government Benches do not regard such a programme as an election loser; they regard it as wrong. The opponents of the hon. Member for Broadgreen are perhaps on the Front Bench on his own side of the House. It was an interesting slip because it showed how little the purpose of the hon. Member's speech was to debate with the Government.
  The Government do not deny or dispute the long-term decline and the problems of Liverpool, or those of any other of the older industrial cities of this country. Those cities are no different from the older industrial cities in many other parts of Europe. I was in Bremen recently. We do not often associate declining industrial cities with Germany, but there is 20 per cent. unemployment in Bremen. There is a whole list of cities in Europe whose industries were based in the industrial past and which face the same sort of problems as Liverpool faces.
  The debate between the hon. Gentleman and the Government, as opposed to that between himself and the Opposition Front Bench, is about the best response to the problems that are faced by Liverpool. Is the best approach to try to brand the city, through the city council, as one that is famous for municipal irresponsibility, for conflict and for delighting in the prospect of conflict, as we have heard from the hon. Gentleman? Is that the best way to help Liverpool in future? The answer—it comes with a resounding no from the Government—is that that is the worst way of trying to help Liverpool.
  The Government have spent massive resources on Merseyside and Liverpool since they came to power. Over
  1328
  £1 billion a year has been spent by the Government on Merseyside since 1981–82, if all Government programmes are taken into account. If all Government programmes are considered, well over £400 million has been spent in Liverpool this year.
  Let us consider housing. The very problems which are so real in Liverpool—the hon. Member has described them and no one will dispute his description—stem from the policies and mistakes, which are now being repeated. The construction of huge municipal housing estates in inhuman styles with no basis for real communities created the problems that the hon. Gentleman and his colleagues draw to our attention. They go back over many years.
  Mr. Parry: To pre-war years.
  Mr. Waldegrave: As the hon. Member for Liverpool, Riverside (Mr. Parry) says, many of the problems may stem from pre-war years. Many of them have come from the great post-war municipal housing boom. The hon. Member for Broadgreen proposes to compound the mistakes of past years by pouring more municipal money into the city in exactly the same way. Why is it that the new Labour city council, since its election, has rejected all the imaginative schemes involving private capital, cooperatives and the ingredients that we have seen so successfully applied in Stockbridge village, Minster court and elsewhere? Those are forward-looking and imaginative schemes, which hold out some hope of finding a way forward. They do not involve a programme that merely redoubles the municipal housing of the past. The policies that the hon. Gentleman is trying to repeat were those that caused many of the problems with which he is allegedly trying to deal.
  The Government said last year that within the constraints that would be placed upon them—I refer to the next sentence of the letter of my right hon. Friend the Secretary of State, which the hon. Member for Broadgreen did not quote the efforts of my right hon. Friend the Secretary of State to provide a reasonable urban aid programme and a reasonable allocation for Liverpool would have to come within the general contraints on public expenditure. Within those constraints my right hon. Friend has provided an allocation for 1985–86 for the inner city partnership on Merseyside as a whole of about £24·1 million. Bids for 1985–86 are still being considered but it is likely that Liverpool city council's share will be about the same as last year, about £20 million. Giving the constraints that lie on the Government, that is not a bad record. There are many other cities that are aware of the resources that are being poured into Liverpool and they wonder whether it is worth while. The hon. Gentleman is seeking to spend not his money or Liverpool's money. It behoves him to remember that the money that he wants to spend comes from taxpayers and ratepayers elsewhere in the country.
  There has been a wide range of other Government expenditures. I have mentioned some from my own Department but it is worth remembering that there is a huge range of others. The Department of Health and Social Security will spend about £127 million this year on hospital and community health services. The Department of Trade and Industry will spend about £24 million on grants and expenditure on industrial investment. The Manpower Services Commission will spend £42 million.

  1329
  It is not a lack of Government resources that lies at the heart of Liverpool's problems. The difficulties go back to far deeper structural problems. A problem that has been added unnecessarily to the structural problems is the attitude of the city council. Its policies are almost designed to drive away private investment and to produce conflict and despair.
  The hon. Member for Broadgreen referred wrongly to the Secretary of State making threats against Liverpool; he verged upon extraordinary language. What the Secretary of State did recently was merely to remind Liverpool city council, as it needs to be reminded from time to time, of the law on capital allocations. The city council originally spoke of extravagant proposes incapable of being financed. I have information from meetings today that it has drawn back from a programme that could not have been financed and is saying that its programme for this year will be met within the legal allocation. If that is so, it is much to be welcomed, and I hope that it will be matched by a drawing back from any illegality in regard to the setting of the budget. Nothing could be more designed to damage the provision of jobs and investment in Liverpool than the city council taking the city through a whole charade of conflict over the budget such as we had last year.
  I think the House had assumed that it heard all it needed to hear on the problems of Liverpool's budget last summer. It might have been assumed that the city council would have learned a lesson from last year's experience. I hope that I am proven to be wrong but it seems that those assumptions could be wrong. We are dealing with a council that does not respect the normal traditions of responsible local government. The council persists in claiming, as the hon. Member for Broadgreen claimed, that Liverpool has lost rate support grant on the assumption that the grant should be fixed for all time at the level of 1979–80. That is plainly nonsense. The suggestion that the city council has been harshly treated is scarcely borne out by the 1985–86 rate support grant settlement. The council's target, at £222 million, is a 2·3 per cent. increase on its 1984–85 adjusted budget. Some authorities have been asked for a 1·5 per cent. cut. The council's grant-related expenditure has risen by £19 million, or 9·6 per cent., to £217 million. This is the third highest GRE for any metropolitan district. The block grant that the council would receive for spending at target has increased by £3
  1330
  million, or 2·5 per cent., to £118 million. So, if the council operates responsible financial policies, it can draw very substantial support from the taxpayer.
  Nevertheless, the council is again threatening not to make a proper rate. I cannot stress too strongly that the consequences for Liverpool will be far worse if the council does that rather than accepts its proper statutory responsibilities. If no rate is made, who will provide the services on which so many depend? Who will pay the council staff? Even if, as last year, the council eventually sees the folly of its threat, the people of Liverpool will have suffered further months of needless anxiety and the reputation of the city will have suffered a further knock.
  Let me make the Government's position clear. We do not deny the gravity of Liverpool's problems, but these must be tackled by responsible and legal action rooted in the real world—
  Mr. Parry rose—
  Mr. Waldegrave: I am not giving way. As the hon. Gentleman will see, I have very little time left.
  As I was saying, the problems must be tackled by action rooted in the real world and not in some fantasy world of political rhetoric, where money is alleged to grow on trees and where the law is to be set aside if it suits the council to do so.
  The hon. Member for Broadgreen referred to violence. If one wanted to use this great debating Chamber as a way of reaching people and saying a few things to damage Liverpool, one should make the predictions of violence that the hon. Gentleman made tonight. We know, and he knows, that the enormous majority of people in Liverpool would repudiate such attitudes. It is the raising of such scares and the scarcely concealed glee with which the hon. Gentleman spoke of conflict that do such damage to Liverpool.
  I have every confidence that the people of Liverpool will have more sense. If they do, they will have done much more for their future than will the overheated and rather trivialising rhetoric we have heard from the hon. Member for Broadgreen.
  The Question having been proposed after Ten o'clock on Thursday evening and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at fifteen minutes past midnight.

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Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Gloucester): The LORD CHANCELLOR on the Woolsack.

Falklands Campaign: Cost
Lord Boyd-Carpenter: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what was the cost to public funds resulting from the loss of life and damage to property and ships caused by Argentina in the course of its invasion of the Falkland Islands.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, the cost of the Falklands campaign and of subsequent expenditure in 1982–83 was £780 million, but it is not possible to disaggregate these costs. Over the following two years provision of £550 million was made for residual campaign costs and the replacement of lost equipment. In addition, expenditure by the Foreign and Commonwealth Office on compensation, rehabilitation and development aid since 2nd April 1982 until the end of the current financial year is expected to amount to some £27 million.
Lord Boyd-Carpenter: My Lords, in thanking my noble friend for that very interesting and informative reply, may I ask him whether that substantial expenditure on behalf of the British taxpayer will be borne in mind when applications are made for financial assistance for the somewhat rickety Argentine economy?
Lord Trefgarne: My Lords, we certainly bear all such considerations in mind in the circumstances to which my noble friend points.
Baroness Nicol: My Lords, is the noble Lord aware of the degree of dissatisfaction in Port Stanley with the state of repair of some of the civilian buildings, both public and private? Will he accept that I have had a letter in the past week to that effect? Will he assure the House that at least part of the £27 million will go to helping civilians to get back at least to their previous standard of living, if not to a better standard?
Lord Trefgarne: My Lords, I was recently in the Falkland Islands and I am aware of the kind of views to which the noble Baroness refers. Of course much of the money provided by the Foreign and Commonwealth Office will be used for the purposes that she describes.
Lord Boston of Faversham: My Lords, can the Minister say anything about the extent to which claims for compensation are still anticipated and in particular about how those relate to merchant shipping?
Lord Trefgarne: My Lords, I am not aware of any significant claims that remain to be assessed, but if the noble Lord is aware of any, I shall be happy to look into them.
Lord Taylor of Blackburn: My Lords, is the Minister aware that the cost mentioned represents the cost of 15 new hospitals and 25 large comprehensive schools in the United Kingdom?
Lord Trefgarne: My Lords, I am aware that the total sum of money is very large, but freedom does not often come cheap.
Earl Lloyd-George of Dwyfor: My Lords, can the Minister tell the House whether the detection and lifting of mines in the Falklands is still proceeding satisfactorily? In addition, is it not a fact that the failure of the Argentines during the hostilities to keep adequate records of such minefields under the Geneva Convention has made that operation even more hazardous than usual?
Lord Trefgarne: My Lords, it is the case that a large number of mines in the Falkland Islands remain in position and have not yet been removed. We are working very hard to devise methods of doing that, but, as the noble Earl may be aware, plastic mines are particularly difficult to deal with in that way.

Overseas Aid and UK Exporters
3.4 p.m.
Lord Constantine of Stanmore: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what percentage of overseas aid programmes to developing and third world countries are on a bilateral basis, to ensure support for United Kingdom exporters of products and services, as opposed to a unilateral basis which gives no guarantee of return to United Kingdom exporters.
The Minister of State, Foreign and Commonwealth Office (Baroness Young): My Lords, in 1983, 59 per cent. of the total aid programme was provided on a bilateral basis.
Lord Constantine of Stanmore: My Lords, I thank the Minister for that reply, but I am sure that she would agree that America, Germany, France and Japan all have very much larger aid programmes than Britain and that they devote a great deal—more, I think, than our percentage—to bilateral deals. Is it not therefore desirable that, with £1.6 billion of British allocation for aid, we should do everything possible to increase our bilateral deals with the rest of the world to the benefit of our exporters?
Baroness Young: My Lords, bilateral aid is normally tied to the purchase of United Kingdom goods and services. In poorer countries we finance some project costs incurred in local currencies. But in 1983 about 75 per cent. of the bilateral programme was tied.
Lord Hatch of Lusby: My Lords, am I right in believing that the noble Baroness is answering this Question as though the word "unilateral" meant "multilateral"? If so, is it not the case that firms in this country get a great many orders from multilateral as well as bilateral aid? For example, do we not receive back in orders almost as much from UNICEF as we contribute to it?
Baroness Young: My Lords, in 1983 our bilateral aid programme financed the purchase of about £453 million worth of goods and services from British industry; but it is also true that British firms benefited from our multilateral aid. In 1983 British firms secured business worth some £446 million through multilateral agencies. I cannot give the noble Lord the precise figures for UNICEF.
Lord Oram: My Lords, in addition to the example that my noble friend Lord Hatch gave, is there not another most important example of multilateral aid leading to benefit for British exporters; namely, the International Development Association? Do we not get more than a pound for pound advantage from our contributions to that fund? On the other hand, is not the tying of aid sometimes prejudicial to the achievement of desirable results? For example, is it not desirable to untie the £15 million which the noble Baroness told me the other day is being allocated to support the special Africa fund? Can the Minister say whether any decision has yet been made to untie that element of aid?
Baroness Young: My Lords, on the last point of the noble Lord's supplementary question, the matter of whether the special facility aid money will be tied or untied is still to be determined. On the first part of his question, I would accept that the fundamental purpose of our aid programme is to promote the long-term growth of developing countries, but the Government believe in supporting British firms where we can.
Baroness Gardner of Parkes: My Lords, will the Minister confirm that the money given by this country to the Voluntary Fund for Women, set up by the Decade for Women, has been given without strings, and really is of great benefit to the people receiving it and gives benefit to those in this country in that we are helping the poorest to help themselves?
Baroness Young: My Lords, it is always difficult to comment without notice on a specific case, but I would agree generally with what my noble friend has just said.

North Sea Oil: Production
3.8 p.m.
Lord Stoddart of Swindon: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they intend to introduce measures in 1985 to encourage enhanced oil production from existing North Sea oilfields.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, the Government have under review the possibilities for additional measures to encourage enhanced oil production from existing fields in accordance with their policy of achieving maximum economic recovery of petroleum from the United Kingdom Continental Shelf.
Lord Stoddart of Swindon: My Lords, may I thank the noble Lord for his helpful reply? Will he confirm that incremental oil from a large existing oilfield could very well be equal to the total capacity of a new marginal field? Can he assure me that the Government are keeping closely in touch with research and development into techniques to recover that substantial potential increment to our oil supplies and are addressing themselves to the problem of financial incentives to encourage the exploitation of incremental oil?
Lord Gray of Contin: Yes, my Lords, I can confirm to the noble Lord the points which he asked me about. My right honourable friend the Chancellor of the Exchequer announced during his 1984 Budget speech in another place that the Government would be reviewing the fiscal treatment of incremental investment in existing fields. It will of course be for the Chancellor to announce the outcome of the review in due course. The Government keep in touch with techniques for enhanced oil recovery used in other countries, though it must be noted that these techniques have so far been developed with the landward rather than the offshore production of oil in mind. So far as offshore oil is concerned, they are still in their early stages.
Lord Parry: My Lords, will the noble Minister have a mind to mention the Celtic Sea under the general heading of this question?
Lord Gray of Contin: My Lords, I am sure that my right honourable friend the Secretary of State for Energy will be delighted to think that there are many who still have confidence in the reserves or the potential reserves of the Celtic Sea.
The Earl of Lauderdale: My Lords, will my noble friend agree that the last very helpful fiscal incentives to the oil industry were provided in the Budget after some three years of pressure by the United Kingdom Offshore Operators Association, supported, indeed, by the department of which he was a distinguished Minister of State? Will he therefore press the Treasury to hurry up with this study and make sure that another three years do not have to pass before the excellent arguments of the oil industry are accepted and then boasted about afterwards by the Government?
Lord Gray of Contin: My Lords, I think that my noble friend was perhaps being a little unfair on the Government there. After all, the decisions which were taken in the Chancellor's Budget of 1983 have led to the enormous increase in exploration in the North Sea. The point which he makes, that further incentives should be given in some future Budget, will certainly be noted and I have no doubt that the Chancellor is considering all these matters in preparing his Budget.

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But of course I have no idea if this features among the priorities.
Lord Cledwyn of Penrhos: My Lords, given our dependence on North Sea oil revenue, can the noble Lord give us an up-to-date estimate of the effective and practical life of the North Sea oilfields?
Lord Gray of Contin: My Lords, I am sure your Lordships will appreciate that is an extremely difficult question. The Department of Energy at the present moment claim that we shall be self-sufficient in oil until the end of this decade, although there is little doubt that we shall be taking oil from the North Sea after the end of the century.

NATO Exercise: WINTEX-CIMEX
3.13 p.m.
Lord Jenkins of Putney: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the NATO exercise WINTEX-CIMEX will have any practical implications for civil liberties and human rights in the regions affected.
Lord Trefgarne: Certainly not, my Lords. Although details of the exercise are classified, I can say that it is designed to test military command and control procedures and is firmly based on NATO's deterrence strategy. It is thus helping to preserve the civil liberties and human rights which we enjoy today.
Lord Jenkins of Putney: But, my Lords, is the noble Minister not aware that the exercise includes aspects of what is being called civilian control? Will he confirm that a list of some 25,000 people has been drawn up, a list consisting of those whom the Prime Minister referred to as "the enemy within"? Is the Minister aware that I shall take it gravely amiss if I am not on the list?
Lord Trefgarne: My Lords, I shall have to see what I can do for the noble Lord.
Lord Boston of Faversham: My Lords, I do not invite the Minister to include me in that, anyway. Can he confirm that local authorities are not involved in this exercise? If that is the case, can he say why they are not being involved, in view of the fact that according to Mr. Stanley, in another place last year, the intention of the exercise is to cover the whole spectrum of a crisis and it is somewhat difficult to see why local authorities should not be involved in view of the civil defence aspects of this?
Lord Trefgarne: My Lords, I cannot go into the details of the scenario of this exercise, as I have said. However, as I have already explained, the exercise is designed to test the full spectrum of NATO's procedures and plans for crisis management in times of tension and war. I am certain that it will do that.
Lord Jenkins of Putney: My Lords, is the noble Lord aware that he appears to have contradicted
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himself in his answers? So far as his first Answer was concerned he appeared to suggest that civilians were not at all concerned in this matter. However, regarding his second answer, he did not deny that a list of potential arrestees had been drawn up.
Lord Trefgarne: My Lords, I do not want to contribute to the noble Lord's fertile imagination, if he will forgive me for not doing that. However, I can tell him that this exercise has been very carefully planned and there will be no question of civilian participation along the lines that the noble Lord suggests.

Business
3.15 p.m.
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Gray of Contin will, with the leave of the House, repeat in the form of a Statement an answer to a Private Notice Question in another place on the mining dispute. This will be followed by my noble friend Lord Glenarthur who will, with the leave of the House, repeat a Statement on the limited list of National Health Service drugs. This will be followed by my noble friend Lord Young of Graffham who, again with the leave of the House, will repeat a Statement on Skillcentres.

Child Abduction and Custody Bill [H.L.]
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, I beg to introduce a Bill to enable the United Kingdom to ratify two international conventions relating respectively to the civil aspects of international child abduction and to the recognition and enforcement of custody decisions. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(The Lord Chancellor.)
On Question, Bill read a first time, and to be printed.

Land Registration and Law of Property Bill [H.L.]
The Lord Chancellor: My Lords, I beg to introduce a Bill to restrict the circumstances in which the rights of persons in occupation of registered land constitute overriding interests for the purposes of the Land Registration Acts 1925 to 1971 and in which purchasers of unregistered land are affected with notice of the rights of persons in occupation of the land. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(The Lord Chancellor.)
On Question, Bill read a first time, and to be printed.

Trustee Savings Banks Bill
Brought from the Commons; read a first time, and to be printed.

Valerie Mary Hill and Alan Monk (Marriage Enabling) Bill [H.L.]
3.18 p.m.
Viscount Massereene and Ferrard: My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read a third time.—(Viscount Massereene and Ferrard.)
The Lord Bishop of Gloucester: My Lords, I hope it will not be thought inappropriate by this House, or by the noble Viscount, Lord Massereene, if a brief interjection is made from these Benches, even at this stage in the progress of this Bill. Your Lordships may recall the speech made by my right reverend friend the Lord Bishop of Ely when this Bill was being read a second time. In it, he referrred to the report entitled No Just Cause, produced by a group led by the noble Baroness, Lady Seear. May I on behalf of the bishops and others in the community reiterate the gratitude which we felt and expressed for that report in our discussions?
However, at the time of the Second Reading of the Bill now before us it was not possible to give any particular expression to the corporate mind of the bishops, as they had had only a preliminary discussion of the report with no conclusions drawn. I can now report to your Lordships' House that the House of Bishops at a meeting last month was able to give time to a further discussion of these matters of principle raised in the report. As the minutes of that house record, on the question of marriages between parents-in-law and children-in-law the House of Bishops resolved, by 36 votes to one, to endorse the recommendations of the minority of Lady Seear's group; namely, that the existing impediment to such marriages should be retained. I believe it is only right that this should be reported to your Lordships' House.
However, it is equally right to point out that the House of Bishops has had no discussion whatsoever on the particular case of Mrs. Hill and Mr. Monk. It would therefore, in my judgment, at least, be going too far to assume that the bishops would necessarily take any particular view in regard to this Bill. As my right reverend friend the Bishop of Ely suggested on Second Reading, one can be cautious in principle and at the same time acknowledge that the circumstances of individuals, in all their complexity, may justify certain exceptions, given the present state of the law regarding personal Bills. The bishops' main concern is, and, I am sure, will be, to affirm and strengthen the bonds which secure family life in our society. The target that they have in their sights, so to speak, is not this particular Bill, but the debates on affinity in principle which they expect in due course following the publication of No Just Cause.
Lord Mishcon: My Lords, at the Second Reading of this Bill, dealing with the private lives of two human beings, the House exercised its usual diligence and care in considering matters of this kind. Many of us felt that there were special considerations that deserved our sympathy in this case. I rise on this occasion only to repeat something that I ventured to say on Second Reading on behalf of my noble friends. It was that we
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should consider at a very early date whether it is the correct procedure and the most human procedure that exceptions to our general law, as it stands at the moment, should be considered in this way in public in your Lordships' House. There must be more suitable, more private and more compassionate ways of dealing with matters of this kind. That is the only contribution that I have to make on the Bill this afternoon.
Lord Lloyd of Kilgerran: My Lords, I support the Third Reading of the Bill having at one stage brought in a Bill designed to achieve what the noble Lord, Lord Mishcon, has indicated—to avoid the almost inhuman approach that is necessitated by the procedures for dealing with these matters. I listened with great care to the right reverend Prelate. I hope that the Bench of Bishops will adopt their usual compassion in relation to matters of this kind. I hope that it will be possible in the near future to find a procedure that is far more satisfactory than the present procedure for the purpose of dealing with this kind of situation.
The Earl of Lauderdale: My Lords, having just listened to the noble Lord, Lord Mishcon, as we did on Second Reading, I should like to express the same view. It is most unpleasant for this House to be confronted with personal, private and intimate details of a situation of this kind. I support ardently and most sincerely his view that we must find a different and better procedure.
The Bill has practically completed its progress through this House. Before that final stage is reached, three points need to be made and should be made. At any rate, I feel that I must make them. Those of us who have intervened, whatever view we take, have had in mind three points. First, this is a private problem. Secondly, the most important need for society as a whole, whatever our religious beliefs or scepticism, is that the family should be preserved as an institution, with barriers to protect it as a desexualised institution for the protection and upbringing of the young. Thirdly, as the right reverend Prelate has said, there has been an overwhelming vote in the House of Bishops which enables those of us who are members of the Anglican Communion—I am a Scots Episcopalian—to take, with the backing of authority and scholarship, a much firmer and clearer line than we might otherwise have taken. In this case, it is to support the minority report of the very interesting service rendered to us by the noble Baroness, Lady Seear, and her committee in their study of the matter. Finally, it is worthwhile, and proper to warn that if there is another occasion of this kind, the promoters should not assume that they will win approval for their Bill so easily as has happened this time.
Viscount Massereene and Ferrard: My Lords, I would have been happier, though I am sure that it is not the right reverend Prelate's fault, had I been informed that he would be speaking on this subject. I am no ecclesiastical—if that is the word—or theological expert, but I agree with those noble Lords who have spoken that it is embarrassing for the couple involved to have their names dragged through Parliament. I hope that in the future other arrangements can be made. As my noble friend Lord Lauderdale has

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said, this Bill now before the House for Third Reading has gone through 90 per cent. of its stages. Nothing can therefore be done about it, presumably, at this stage.
As I remarked in Second Reading, there were extenuating circumstances and perhaps exceptional circumstances in this case. The most important was that concerning the upbringing of the children. I thank the noble Lords who have spoken. I believe that we now have to vote—
Noble Lords: No
Viscount Massereene and Ferrard: My Lords, I beg to move that the Bill be now read a third time.
On Question, Bill read a third time, and passed, and sent to the Commons.

Milk (Cessation of Production) Bill
3.28 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead): My Lords, I beg to move that this Bill be now read a second time. The main purpose of this Bill is to provide the necessary statutory authority for payments under the milk outgoers' scheme. The supplementary levy and milk quota arrangements were introduced in April last year in an attempt to achieve an immediate cut in production in most member states of the European Community. Over-production of milk in the Community had been escalating over a number of years and disposal of the surplus was placing a growing burden on the Community budget. By March last year, with up to £10 million a day being devoted to the milk sector alone, clearly urgent action had to be taken.
When it became clear that other member States were not prepared to agree to price reductions necessary to achieve a rapid drop in output, there was no alternative but to accept the introduction of quotas, and the supplementary levy. Under the levy system, most member states, including the United Kingdom, have been allocated national quotas based on the amount of milk delivered to dairies and other undertakings or sold for direct consumption in 1981, plus 1 per cent. In the United Kingdom the introduction of quotas meant that producers were required to cut their production by about 6¼ per cent. in 1984–85 by comparison with 1983 in order to avoid liability for supplementary levy on excess production. A futher cut of some 2½ per cent. was then imposed on producers in order to create a reserve of quota to ease the difficulties of certain producers in special situations. Thus, overall, producers in the United Kingdom have had their primary wholesale quota allocations—that is, their basic quotas—set at 9 per cent. below their 1983 production levels.
Quotas have fallen particularly hard on the smaller producers—those with up to some 200,000 litres of annual milk production, representing about 40 cows in the herd. These small producers represent a very considerable proportion—some 40 per cent.—of all milk producers in the United Kingdom, and it is their difficulties which our milk outgoers' scheme is particularly designed to alleviate.
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Under the Community levy rules, member states are allowed to compensate producers who go out of milk production by giving them grants out of national funds. The purpose of these grants is to assist any necessary restructuring of the dairy industry following the imposition of quotas. These grants are intended to provide farmers with the necessary cash payments to allow early retirement or to switch production. Those are just two examples; doubtless in practice there will be others. But, for whatever reasons, those farmers giving up production will help those who wish to carry on because the quota they surrender may be reallocated to other producers who will then be able to produce more without incurring liability for levy.
All member states, with the exception of Denmark, Greece and Luxembourg, have chosen to make use of this provision in the Community regulations to introduce nationally-funded outgoers' schemes. The various schemes all differ markedly from one another to reflect different circumstances and different aims. The response of producers in Great Britain at least shows that we have pitched the payment, which comes to about £650 per cow, assuming a yield of about 5,000 litres annually, at about the right level. The indications are that we should get the amount of quota we are seeking and that the number of producers who wish to but cannot join the scheme will be very small.
In the United Kingdom the deadline for applications for this scheme was 28th August last. So far, already over 1,000 producers have been paid and have given up their quota. The fact that the scheme is so far advanced prompts the very reasonable question: why the need for the present Bill? The answer lies in the fact that under our outgoers' scheme we have made provision to spend up to £50 million over a period of five years. Spending this amount of money over this length of time requires, for reasons of constitutional propriety, specific statutory authority. Had we been under a Community obligation to introduce the outgoers' scheme, we would have used existing powers under the European Communities Act. But the Community outgoers' provision is permissive only and we therefore need to have the specific legislative authority provided in this Bill.
The actual authority for these payments is provided by Clause 1 of the Bill. Clause 1 enables payments to be made to producers who, in return, undertake to give up milk production and surrender their quota. This is in line with existing Community rules. Following an amendment tabled at Committee stage in the other place, which was accepted by the Government, Clause 1 also now makes it possible for payments to be made to producers who reduce their production and surrender a corresponding part of their quota. The Government felt that although partial surrender of quota is not at present permitted under Community rules it might, if the rules were changed, introduce further much-needed flexibility into the quota system. There is no indication at present that the regulations are likely to be amended to allow this. However, if at some time in the future it is allowed we shall have the necessary legislative authority to put it into effect in Great Britain through any future scheme.
Clause 1 further provides that statutory schemes for paying out compensation to milk producers may be set up. It is clearly sensible to take these powers now so

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that they will be available if a future statutory scheme is ever required. But, once again, I must warn the House that at the present time the Government have no plans to introduce a further outgoers' scheme. Clause 1 also provides that any money paid out under a scheme may be recovered if the person who receives the payment fails to comply with the conditions laid down; for example, if he were to return to milk production. Clause 2 provides powers of entry on to land and access to records. This is to enable checks to be made to ensure that producers receiving outgoers' payments are not engaged in milk production.
I think the rest of the clauses are self-explanatory, except perhaps for two. Clause 5 defines the Ministers who may exercise functions under the Bill. It means, in effect, that any future schemes could be made by my right honourable friend the Minister of Agriculture, Fisheries and Food, and also my right honourable friends the Secretaries of State for Wales and for Scotland, acting either individually, or together in any combination. The other clause I have just referred to—Clause 6—is the one which applies to Northern Ireland. Our existing outgoers' scheme applies throughout the United Kingdom, but for constitutional reasons this Bill does not apply (with the exception of course of this clause) to Northern Ireland. Clause 6 simply provides that an Order in Council for Northern Ireland which is made for the same purpose as in Clauses 1 to 3 of the Bill shall be subject to the negative resolution procedure. I understand that my right honourable friend the Secretary of State for Northern Ireland intends to lay an order before Parliament immediately after the enactment of this Bill.
As to the way in which the outgoers' scheme is working, I am sure many of your Lordships will know that tenants in England and Wales have to have their landlords' written consent before they can join the outgoers' scheme. In the early days of quotas we tried to bring the landowning and farming interests together to see whether they could agree on procedures allowing tenants to become outgoers without their landlords' consent. However, the two sides were unable to reach agreement. As a result, we felt we had no choice but to require landlords' consent in all cases. Had we not done so, apart from the obvious problems of equity where the landlord had made considerable investment in dairying there would, so I am advised, have been a risk of certain legal difficulties. If a tenant joined the outgoers' scheme and surrendered his quota without the landlord's consent it might have been possible, depending on the terms of his lease, for his landlord to sue him for breach of contract.
Moreover, the landlord might have been able to claim that the Minister had incited the tenant to break his contract. This is a scheme which is based on a contract between the Minister and the producer, and is therefore based on contract law and not on statute. Despite the lack of a formal agreement between the landowning and farming interests, a substantial number of tenants in England and Wales have been able to become outgoers. Part of the credit for this must go to the president of the Country Landowners' Association, who has urged his members to listen carefully to every tenant who wishes to become an
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outgoer and to be as accommodating as possible. In Scotland, the various interests were able to agree on more favourable arrangements for tenants, and these also appear to have worked reasonably well.
The aim of the scheme is to buy up 289 million litres of quota in England and Wales. The producers who initially expressed interest in the scheme had between them about four times as much quota as was wanted. We knew from the start that a considerable proportion of these would drop out, but because the scheme was evidently over-subscribed, we had to decide which producers should be given priority. We started by inviting the smaller applicants to join, and when some of these dropped out we invited some bigger ones to come in. By last week we had sent firm invitations to all those with up to 500.000 litres of quota to offer. Now, in order to speed up the final stages of the scheme, we are writing to all the remaining applicants asking them to state whether they will wish to join the scheme. Our intention is that by the end of March all those who say they are still interested will be told definitely whether or not it is possible for them to join the scheme.
Although the drop-out rate at each stage has been fairly high, the scheme is operating satisfactorily in England and Wales and we believe we shall achieve our target of 289 million litres. The same is true of Scotland, where the target is 30 million litres. In Northern Ireland the position is less satisfactory, and my right honourable friends are looking to see if there are any ways of dealing with the problem there.
The precise arrangements for re-allocation of outgoers' quota will vary somewhat between England and Wales, Scotland and Northern Ireland in the light of local circumstances and priorities. In England and Wales our intention is to help small producers—those with less than 40 cows—and exceptional hardship cases.
So far as small producers are concerned, our intention for next year is to increase the quotas of all producers whose main occupation is farming and who have less than 200,000 litres of quota. The increase will be sufficient to bring these farmers back to their 1983 production levels, provided those levels are not above 200,000 litres.
So far as exceptional hardship cases are concerned, our intention in 1985–86 is to give producers the full amounts awarded by the tribunal. I should emphasise that what I have said, both about small producers and about exceptional hardship cases, is subject to a final check of the figures once we know exactly how much quota is required. The remaining quota available next year, after meeting the needs of exceptional hardship cases and increasing the quotas of small producers up to their 1983 production levels in the way in which I have described, may be used to help producers who are awarded development quota by the tribunal; that is, producers engaged in expansion programmes whose awards will have been pruned back in 1984–85 to keep within the total amount of quota available. I have to say that at the moment it looks as if the cut in those awards in England and Wales may be at least 35 per cent., or, indeed, more. Next year, we hope to be able to reduce that cut by using any of the spare outgoers' quota.

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Finally, because producers who became outgoers will have used a significant part of their quotas before joining the outgoers' scheme, the total amount of quota available for re-allocation in what remains of this year will be substantially less than that which will be available for a full year when we come to the next marketing year, 1985–86. Therefore, in 1984–85 we envisage using all the outgoers' quota which is becoming available to help the exceptional hardship cases.
Although, as my right honourable friend said in another place, this is a short Bill and comparatively narrow in scope, it is nevertheless of great importance to many dairy producers in Great Britain. My Lords, I beg to move.
Moved, That the Bill be now read a second time.—(Lord Belstead.)

The Miners' Strike
3.43 p.m.
Lord Gray of Contin: My Lords, with the leave of the House, I shall repeat in the form of a Statement the Answer to a Private Notice Question given by my right honourable friend the Secretary of State of Energy in another place. The Statement reads as follows:
"Mr. Norman Willis, on behalf of the TUC, held a series of discussions with the Chairman of the National Coal Board. As a result of these discussions proposals were prepared by the board which expressed the basis upon which an agreement could be reached on the main issues of the dispute. These proposals took account of the views Mr. Willis had expressed to the board.
"Over the weekend the TUC showed this paper to the NUM executive, who asked for amendments to be made. The coal board confirmed to the TUC that this was their final paper. The TUC then requested a meeting with the Prime Minister.
"The TUC confirmed to the Prime Minister that the proposals under discussion would, if agreed to, constitute the final agreement on all of the matters which they dealt with, and that they were not a document which would be an agenda or form the basis of any further negotiations on these issues.
"The TUC explained to the Prime Minister that they had a number of difficulties with the document, and my right honourable friend undertook that I would convey their views to the National Coal Board. This was done, and subsequently the seven TUC leaders asked to have further talks with me before they met the National Coal Board. During these talks I clarified the Government's desire to see that the new NACODS procedures were brought into operation as speedily as possible, and that it was the coal board's intention that they would be in place by the time they were needed. I explained that neither the board nor the Government could accept a position where if the NUM refused to agree to the detail of the independent body, no review procedure would exist. For this might have the effect of the NUM being able to frustrate any reasonable plans for closure. The document was therefore amended to express the desire of all parties to see that the new
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procedures were in operation by 1st June, which would be well in time for any disputed closure to be referred to the independent body.
"The document was further re-ordered to meet the NUM's anxiety that its sequence as originally drafted could have implied that disputed closures would take place prior to going through the proper procedures. A re-ordering of the document made it perfectly clear that a disputed closure will only take place at the end of the agreed procedures.
"I share the TUC's disappointment that the NUM executive has rejected the proposals which had been made. The NUM executive have now rejected proposals in seven rounds of talks, the compromise proposal put forward by ACAS and the proposals prepared following discussions between the TUC and the National Coal Board.
"I deplore that the generous and reasonable offers now available to miners continue to be rejected by the NUM executive. Those coalfields which originally balloted voted overwhelmingly against strike action. I can only urge those miners still on strike, though deprived of a ballot, to return swiftly to normal working, so that the damage being done to their industry, to their families and to their communities can come to an end."
My Lords, that concludes the Statement.
Lord Stoddart of Swindon: My Lords, I thank the noble Lord for repeating in the form of a Statement the Answer given by his right honourable friend to the Private Notice Question which was asked in another place. I should also like to express appreciation of the tireless efforts of the TUC and, in particular, of Norman Willis to bring about an early settlement of this tragic (and that is all that it can be called) coal industry issue.
First, will the noble Lord confirm that the National Coal Board has accepted the new document in its entirety? Will he also tell us whether the National Union of Mineworkers have, in fact, made substantial concessions and have, indeed, now accepted the NACODS settlement as being applicable to them? Furthermore, is it possible that the rejection of the latest document by the National Union of Mineworkers has arisen from a simple misunderstanding? If that is so, would not the best way forward be through immediate, direct negotiations between the National Coal Board and the National Union of Mineworkers? Will the noble Lord, in the interests of harmony, take this opportunity to refute suggestions that his right honourable friend the Secretary of State and the National Coal Board have now adopted a hard line—a "take it or leave it" attitude?
Lord Ezra: My Lords, I, too, should like to express appreciation for the Statement which has just been made by the noble Lord to keep us informed of the latest developments in this important and distressing situation. I, too, should like to join in the tribute which has been paid on both sides to the tireless efforts of Mr. Norman Willis and the TUC in seeking to find a solution. I think that it already marks some progress in this tragic dispute that the intervention of the trade union organisation has been of such a positive nature.

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Let us hope that it will not be put off by the rebuff that it seems to have suffered on this occasion.
Would the noble Lord not agree that, in spite of the length of time that this unfortunate strike has lasted, the coal industry of Britain still has good prospects, but that those prospects will undoubtedly be further damaged the longer this strike goes on? What is now important is that there should be a quick return to work, a major effort to get production moving again and, as there appears to be general agreement for the revised colliery review procedure, a determined effort to get that procedure working satisfactorily. Therefore, will the noble Lord not agree that these are the objectives to which all those who are keen to see this dispute resolved, both outside and inside the industry, should be setting their minds?
Lord Gray of Contin: My Lords, I am grateful to the noble Lord, Lord Stoddart, and to the noble Lord, Lord Ezra, for the comments they have made. I think we are all agreed that this is a disastrous strike and that all those who have the best interests of the mining industry at heart are doing their utmost to try to ensure that it is resolved very quickly indeed.
The noble Lord, Lord Stoddart, first asked whether the National Coal Board accepted the new document. The answer to the noble Lord's question is, Yes. The noble Lord also asked me whether the National Union of Mineworkers had accepted the NACOD's agreement. There is no indication that they have accepted the NACOD's agreement. Up until now the leadership of the National Union of Mineworkers has prefaced all its comments, despite its request for talks without preconditions, by the one condition which is totally unacceptable to all other interested parties, and that is that no pit can be closed for economic reasons. That of course is at variance even with Plan for Coal, which recognises that under certain circumstances that cannot be achieved.
The noble Lord, Lord Stoddart, asked me one straightforward question which I wish I could answer in the affirmative. He asked, did I consider that the rejection of the present proposals was simply due to a straightforward misunderstanding? I do not think that that is the case. I do not think that there is any misunderstanding whatever. Indeed, after the meeting with the Prime Minister and after the subsequent meetings with the Secretary of State for Energy, no doubt whatever was left in the minds of those who were present as to the conditions which were on offer. Perhaps I may quote from the letter from the Chairman of the National Coal Board to Mr. Norman Willis on 20th February, in which he stated:
"The Secretary of State confirmed"
and this is very important—
"that it was the view of the TUC that the document that we had prepared subsequent to discussions with you was a document that, if agreed to, would for all of the matters dealt with in this document be the final agreement and was in no way a document which would be an agenda or form the basis of any further negotiations".
That was made absolutely clear. When one considers that the seven TUC representatives who took part in this discussion were of the stature of Norman Willis, Jack Eccles, David Basnett, Ray Buckton, Moss Evans, Bill Keyes and Gerry Russell, it seems very
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hard to believe that a team of that calibre would take back to the National Union of Mineworkers a document which they describe as being less favourable than that which had originally been offered.
The noble Lord, Lord Ezra, asked me to confirm that there were good prospects within the industry. As a former Minister of State at the Department of Energy when the noble Lord was Chairman of the National Coal Board, I would certainly confirm that there are excellent prospects in the industry, and the Government's commitment to the Plan for Coal and the amount of money which has been pumped into the industry by the present Government since 1979 fully confirm the Government's commitment to the Plan for Coal. However, I am afraid that a great deal of that money will be wasted unless we can get a quick return to work.
When we consider that already during the present dispute no fewer than 38 producing faces have been lost, it is a tragic situation that we cannot persuade people to accept the best offer which has been on offer to the industry since nationalisation. I can only reiterate what my right honourable friend in another place has already said—that there is only one action left to those who want to see the mining industry continue and to thrive in the future, and that is to return to work and register their approval of what is on offer.

Milk (Cessation of Production) Bill
3.55 p.m.
Second Reading debate resumed.
Lord John-Mackie: My Lords, the Minister put the case for the Bill very well and we thank him for doing so. He also explained—and we all agree with him—that there was very good reason for action because of the milk surpluses costing the Community an enormous amount of money. Therefore, we thoroughly agree that action had to be taken.
However, as the Minister almost admitted, one way and another there has been a considerable amount of uncertainty over this scheme. I need not go into that; it was well aired in another place and, as the Minister has said, account was taken of it in an amendment to the Bill that has now come before this House. We now have the Bill. But I must say that the Bill is still not very definite about how the scheme will work. Like a Bill which we were discussing recently, this Bill contains many powers to enable the Minister to change his mind and make alterations. I can quite understand that that is necessary because much of it is tied to what the Community might do in the future.
However, that does not help farmers to reach a decision, although the Minister has given some figures as to how many farmers have applied to be included in the scheme. I gather that the initial amount available over five years is £50 million. That is probably an estimate and we are not sure whether it is enough. If it is not enough, can the Minister persuade the Treasury to produce some more? There is usually a difficulty there. Is the figure of £130 a year over the five years a final figure, being a total of £650 a cow? Five years is a long time. We do not want inflation to increase, but even with 5 per cent. inflation it does not seem to be a very good deal to divide the £650 over five years.

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The Bill will come into force two months after it becomes an Act. I hope that there will be no delay after it has become law. The noble Lord has indicated that his Ministry have all the arrangements in hand. But we can all remember the shambles there was when the quota scheme came into operation, and the alterations that were made and the continual doubts among farmers as to how it would work.
The Minister referred to the number of farmers who have already applied and I believe he said that they had received 1,000 firm applications and that they had been dealt with. As the noble Lord said, it is difficult to visualise how many people will go in for the scheme. Can he give us some idea of how the estimate is made? The noble Lord said that many people have withdrawn and that invitations have been sent out inviting them back again. I wonder if he could help us over how many and the amount of milk that it represents.
The noble Lord mentioned that this Bill was to help the small producers. Does he think that it will apply mainly to small producers and do the Government really want the small producers to go? I cannot think what a small producer will do. He cannot go in for cereals; beef is not very attractive. I think it will be a pity if the Government indicate that they really want small producers to go. The Minister said that we have some ideas as to figures. What is going to happen to all the cows? This is a difficult situation. Are they to be slaughtered? If they are not to be slaughtered they are going to go into milk production elsewhere, producing over the quota if other farmers buy them. If they are slaughtered this will further depress the beef market, which is not particularly good anyway. The repercussions there could be quite bad for beef farmers.
The Minister went into the question of what arrangements they have made about a tenant farmer; he has to get written permission from his landlord. This is a difficult one. It is hard on a tenant who wishes to go out of milk and his landlord says no. I know the Minister made the point that it depended on how much of the fixed equipment for milk production the landlord had provided. He would naturally give him precedence there. But I still think that there are not enough arrangements being made in tenant rights between a landlord and tenant about this and about the question of the quota. We really have an added complication here. I think the Minister said that the CLA would accommodate farmers as best they could, but I do not think that that is enough.
I am sorry to ask the Minister so many questions, but he must admit that this is a major restructuring of the biggest section of our agriculture and will have far-reaching effects for many farmers outside the dairy industry. What many of them are asking is whether fellow farmers in other parts of Europe are being treated the same. I know that rumours are a bad thing to quote but nevertheless we hear rumours that they are getting a much better deal, particularly in Italy. However, in no way would I suggest that we should delay this Bill. It is necessary to get it through as quickly as possible so that the scheme can go on. The Government are committed to the scheme, so the sooner it is on the statute book the better so that farmers can make up their minds.
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The Minister went into the question of whether there were enough people likely to go out to top up the quotas of those who had hard cases. I hope that there will be, and he indicated that the calculations were about right. But then he indicated that there would be a future supply of extra quota which would be distributed, I forget at what time. But we still have an enormous surplus of milk, and this scheme of quotas and going out of production is only tackling just over 50 per cent. of it. I forget what the surplus that is left is costing the Community per year, but the Minister needs to be very careful before suggesting that there would be a further topping up of quotas when the situation in two, three or four years' time will be just as bad as it is now. However, I hope the Minister can answer some of these questions, and in the meantime we support the Bill.
4.4 p.m.
Lord Walston: My Lords, I am tempted to take this opportunity to develop an indictment of the Government for having made this Bill necessary at all. I would indict them on grounds of short-sightedness; of having failed to foresee the situation many years ago when it was clear to any of us who studied the matter that this was going to happen and that drastic steps had to be taken; of having agreed with the Commission to the introduction of a barely thought-out scheme leading to many anomalies, many difficulties, and great hardship. In addition to that, I indict them for pinning their faith, as I know they have done and I gather they still do, to the theoretical idea that the way to control surpluses in farming is purely by the price mechanism, and only when that fails does one have to resort to something of this sort.
That is not possible whether it is for milk, whether it is for wheat, for sugar beet, or for any other commodity. The only way in which this can be done is by the system that the Government have now been forced into adopting—the system of quotas—but all I would urge on this particular subject is to accept that and to plan ahead for the future when the surpluses of other commodities become insupportable rather than forcing upon producers of those commodities the hardships, the difficulties and the uncertainties that this rapid action has necessitated.
But that temptation, as you will see, I am forgoing. I will not follow through that indictment, much as I should like to. It is all, if I may coin the phrase, milk under the bridge; whether the milk be milk in butter, or from the mountain, or whether it be dried milk powder.
However, there are one or two questions I should like to ask the Minister with regard to this Bill. The first concerns the matter of the landlord and tenant situation, which the noble Lord, Lord John-Mackie, raised. It really is deplorable that it has been impossible to get agreement between landlords and tenants in this matter. I fully realise the interest that both parties have in this; interests which in some cases are almost entirely on the side of the producer and in others far more evenly spread, but I hope that the Government are continuing to try to get some agreement between landlords and tenants in this matter so that those who wish to give up milk production and gain the advantages from this scheme

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will not be in future prevented from so doing because they have failed to obtain their landlord's permission.
The other point about which I should be grateful to the Minister if he could give us some indication is the allocation of the additional quotas. He mentioned it briefly. Will the Ministry be guided in allocating quotas to give the increased quotas, so far as possible, to those where the hardship is greatest? If so, how will they assess the actual hardship? Will they give them only on the grounds of the size of the herd, as appeared probable from what the Minister was saying?
Will they be guided in any way by regional considerations so as to keep a reasonable supply of milk in all the regions of the country rather than letting one area be completely denuded and allowing other areas to stay roughly as they are? Or will they be guided by principles laid down in the Treaty of Rome, for instance, or rather the common agricultural policy? The commodity in question—milk in this case—should be produced in those areas which are most suited to it; in other words, in the West Country and in certain other parts of the United Kingdom at the expense of other areas. If he can tell us what sort of guidelines his Ministry is following in this, it would be of great interest.
Having said that, I shall do no more than echo the noble Lord, Lord John-Mackie, and say that, given these circumstances, which should never have arisen but which have arisen, this Bill is the best way out of a pretty shabby little mess, and we therefore support it and hope that it will get on to the statute book as soon as possible.
Lord Belstead: My Lords, I am grateful to both noble Lords for their support of the Bill, but there is one point I should like to take up from the remarks made by the noble Lord, Lord Walston, because I think it is important. I know that the noble Lord, the Government, the Opposition Front Bench, the noble Lord, Lord John-Mackie, and other noble Lords in the House realise, and that we all accept, that something needed to be done about the milk situation. I gave a really astounding figure at the beginning of my Second Reading speech, saying that support for the milk market in Europe last March was costing £10 million a day. The total support for the year for the milk market in Europe was over £3 billion, rising towards £4 billion. The whole thing had become unsustainable.
If I may, I will pick up what the noble Lord said. The noble Lord took the British Government to task for not having seen this coming. I would only say that Ministers of Agriculture of both the Labour and Conservative Parties have drawn attention in the European Community to the dangers of the ever-escalating price of the common agricultural policy. The noble Lord, Lord Walston, said, on the one hand, that it was the fault of the Government for running into the great difficulties which milk quotas have caused, but, on the other hand, the noble Lord criticised the present Government for saying that we thought that through the price mechanism surpluses could be alleviated. I would only say to the noble Lord, with all his experience of agriculture, that if surpluses are not tackled either through some form of quota
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arrangement or through the price mechanism it is difficult to know in which other direction to go.
I would add to that, and repeat, that what we did consistently over a period of years was that many British Ministers of Agriculture drew forcefully to the attention of our Community colleagues the fact that unless something was done about the price mechanism we would inevitably reach a situation in which something else would have to be done which would hurt even more.
Lord Walston: My Lords, of course Governments of both complexions realised this. My complaint is twofold: that they were not sufficiently forceful to be able to carry their colleagues with them, and that they were not sufficiently thoughtful to put forward practical systems for quota restrictions many years ago—three, four or five years, even, before the noble Lord and his friends were there—so that this situation could never have arisen. My fear is that they are following the same ineffectual path with other commodities.
Lord Belstead: My Lords. I should be foolish if I did not listen to what the noble Lord says—and, indeed, I do. The noble Lord has long experience. But I would make two points by way of rejoinder. One is that I cannot help but reflect on the outvoting of the then Minister of Agriculture some two years ago when my right honourable friend Mr. Walker tried to use the Luxembourg compromise. It came to that, and it was a question of being outvoted. Then, to try to be more constructive in reply to the noble Lord, Lord Walston, in thinking of the future the present Government have used not only their best endeavours but their negotiating skills to get the Ministers in the Community to map out a firm financial plan for the future. We must now try to see that we stick to it.
After that brief exchange, I shall briefly try to reply to the questions which noble Lords have put to me. The noble Lord, Lord John-Mackie, asked me whether the £50 million was enough. In particular, the noble Lord said that it is spread over several years and that that, with inflation and other things, makes it less attractive. The £650 per cow, which is what it comes to—judging by the level of acceptances we are receiving from people who want to go out and make their quota available for people who want to stay in—shows that we have pitched it about right. Secondly, on the instalments point, this is the way in which payments have been made in the past. I am thinking in particular of the non-marketing of milk premium scheme and other schemes which the noble Lord will probably remember better than I do. Instalments can help with income tax liability, and it made it the more possible to make the £50 million available. It would have been the less easy to have found such a large sum in one year and in one year only.
I attach to that reply an important point which arises from another of the questions asked by the noble Lord, Lord John-Mackie. The noble Lord asked whether the Government really want to see the smaller farmer go out. I cannot emphasise too strongly that the beneficiaries of this scheme will be, first and foremost, the up-to-40-cows small producer who it is our firm

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intention should be brought back up to the 1983 level of production. Incidentally, the noble Lord, Lord Walston, was talking about regions. It is interesting that whereas farmers in Wales who have been particularly hard hit are offering only some 12 per cent. of quota, Wales will benefit to the tune of about 25 per cent. of the beneficiaries under the scheme.
When we asked the applicants whether, having made their original applications, they were really serious in wanting to go out and claim the money under the scheme, after a great deal of thought we decided that the only equitable thing to do was to start by asking first the smallest producers who had said that they wanted to go out. We did that. No pressure was brought to bear on them; they were simply asked whether it was their wish. Then we moved up through the applicants until at last we came to the largest applicants.
Lord Walston: My Lords, I have one short question about the payment which is being made to the farmers. What happens if a farmer dies during the intervening period? Will payment cease because it is personal to him, or will it be part of his estate and continue to be paid to whoever succeeds?
Lord Belstead: My Lords, I think the answer to that question is that it is part of his estate, but if I have that answer wrong I hope that I will receive some more advice before we finish, which may not be many minutes hence, so that I may be able to put it right. But I think that is the correct answer.
I should like quickly to answer one more question asked by the noble Lord, Lord John-Mackie. He quite rightly drew attention to the effect on the beef market, but not quite so accurately, with respect to the noble Lord in that he was not quite as optimistic as he might have been. The fact is that, although there has been an increase in slaughtering, producers of certified cattle have received over 98 per cent. of target price in the marketing year to date, and recently there has been 100 per cent. of target price. We have done our best to improve the beef market by more substantial intervention arrangements based on the carcase classification grid and by variable premium payments of from £2 to £3 million a week; and, of course, the suckler cow premium was doubled. Although I take the noble Lord's point that one has to keep a close eye on this, nonetheless I think things have been rather better than the noble Lord indicated.
The noble Lord, Lord Walston, particularly asked about tenants. The one thing that I ought to say to the noble Lord in reply is that, despite the fact that it has not been possible so far to say other than that the tenant in England and Wales must have permission of the landlord, it is interesting that, taking the percentage of tenants in Scotland who have said that they want to avail themselves of the outgoers' scheme as outgoers and the percentage of tenants who have their landlords' permission in England and Wales and have been able to say with permission that they want to avail themselves of the scheme as outgoers, the uptake has been only 8 per cent. less in England and Wales than the uptake in Scotland. I believe that it has not been working out too badly.
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Finally, the noble Lord asked me about the reallocations of quota by size, by hardship and by region. So far as exceptional hardship is concerned, all producers will be given their full award which they have been awarded by the tribunal; and may I at this point say how exceedingly grateful the Government are to the noble Lord, Lord Grantchester, who has been chairman of the Dairy Quotas Tribunal and who has done really marvellous work together with all the tribunal members.
On small producers, there will be no differentiation by region, but the net effect, I am advised, will be to move some quota, we believe, from the eastern parts of England over to the west into Wales. I feel that this will be a welcome effect of the working of the scheme. I think that those are the answers to all the questions I have been asked. I hope your Lordships will agree that the Bill be read a second time.
Lord John-Mackie: My Lords, the important question, I think, was the last one I asked about future allocations. There is still a huge surplus of milk.
Lord Belstead: I am sorry, my Lords; I thought that the noble Lord was labouring under a slight misapprehension. I went out of my way to say that, although the Bill takes legislative power to say that there can be another scheme of this kind in the future, we are not making any provision for another outgoers' scheme.
On Question, Bill read a second time; Committee negatived.

Shipbuilding Bill
4.22 p.m.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth): My Lords, I beg to move that this Bill be now read a second time.
This is a short and simple Bill. It has only two purposes: first, to extend the life of the Shipbuilding Redundancy Payments Schemes by 18 months; and formally to write off certain irrecoverable loans made by the Shipbuilding Industry Board to Upper Clyde Shipbuilders in the period from 1968 to 1972.
The Shipbuilding Redundancy Payments Scheme for Great Britain and Northern Ireland was introduced in 1978 by the then Labour Government. It was backdated to July 1977, to the day on which British Shipbuilders was formed. The scheme was intended to alleviate the human problems caused by the contraction of the industry and was to run for an initial period of two years. The contraction of United Kingdom shipbuilding—and, in particular, its need to achieve competitive manning levels—has unfortunately continued far beyond the original life of the scheme and successive extensions of the scheme have lengthened its life to eight years. The scheme is therefore due to expire on 30th June this year.
The scheme provides for benefits in the form of a lump sum, to all made redundant and, for those over 40, additional weekly support payments for up to two years following redundancy. These payments are over

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and above those payable under employment legislation. Since 1977 about 36,000 former employees of British Shipbuilders have received scheme benefits at a total cost of more than £130 million. Currently some 7,000 people are in receipt of the weekly payments. I do not think that there can be any doubt that the scheme has made a significant contribution over the years to the alleviation of the inevitable personal problems of redundancy and has helped considerably to smooth the path of contraction of the industry itself. Further, it has proved a very valuable tool indeed in the management of the shipbuilding industry.
But the merchant shipbuilding industry continues to face a very difficult market. In many respects we find ourselves back where we were in 1977, albeit with a smaller but still vulnerable industry, facing massive world recession in shipbuilding. Having said that, it is good to note that British Shipbuilders has recently achieved some successes. Two weeks ago it announced an order for four ships, ultimately for use by Cuba, to be built at Smith's Dock, Middlesbrough. This success is particularly welcome for one of British Shipbuilders' most efficient yards. At Austin and Pickersgill, where the order position was desperate indeed, in the last few weeks management and unions have very quickly reached a new agreement on working practices and arrangements. This has enabled the company to proceed with an order for two ships for another foreign owner. The Ministry of Agriculture, Fisheries and Food has placed an important order for an advanced research vessel at Ailsa, the sister yard of which, Ferguson's, on the Clyde, has already this year obtained other valuable orders. And only two days ago British Shipbuilders announced that Govan had obtained a £38 million order for a major ferry for North Sea Ferries. There are also other orders under negotiation, which we see as very encouraging.
As a result of this progress and the considerable efforts being made by British Shipbuilders under its chairman, Mr. Graham Day, it now seems likely that it will reach its stated order target for 1984–5 of 200,000 compensated gross tonnes.
But enthusiasm for these achievements must not blind us to the underlying problems which remain. British Shipbuilders' recent orders, like those which have gone over the past few months to Harland and Wolff in Belfast, continue to require substantial subsidies—within the European Community's rules. British Shipbuilders has a good way to go in regaining competitiveness and becoming a truly viable merchant shipbuilder. Part of that process will involve boosting productivity, increasing the utilisation of facilities and creating regional services serving a number of yards on a much more economic basis. This will inevitably mean further restructuring and. I fear, further job losses.
Although British Shipbuilders is now engaged in turning the industry round, and in the privatisation of the warshipbuilding yards, the Government do not, of course, want to add to its burdens by requiring it simultaneously to negotiate a successor to the statutory Redundancy Payments Scheme. The Government have therefore decided that it would be right to extend the scheme beyond June this year. I
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should immediately stress that this decision does not indicate any lack of faith in the industry or that there are any firm plans to close further yards. Any redundancies that occur later this year or in 1986 will be brought about by the state of the market, or by continuing inefficient uncompetitiveness. These are factors which are outside the control of the Government. Your Lordships will also recall that British Shipbuilders has been asked to dispose of its warshipbuilding yards by 31st March next year. Together with the disposal of the engineering and ship repairing interests currently in train, this means that by the end of 1986 the state will own less than one-third of the United Kingdom shipbuilding industry. Even without further redundancies, British Shipbuilders and Harland and Wolff will by then employ only 17,000 people, compared with over 90,000 when the scheme was first launched in 1978.
British Shipbuilders' management intend that the remaining merchant sector should by then have recovered from the present position and will be well on its way to a competitive position. It should also by that time have found some reasonable level of stability. There will then really be no justification at all for maintaining a statutory shipbuilding redundancy payments scheme for an industry where two-thirds of the workforce are employed in the private sector and therefore would be outside the scheme.
The Government have therefore decided that this should be the last extension of the statutory scheme. Of course, at the same time the Government do not believe that entitlement to redundancy payments should cease with the ending of this scheme. We are therefore asking the managements of both British Shipbuilders and Harland and Wolff, in consultation with their unions, to establish successor schemes by the early autumn of 1986.
It is too soon to say exactly what these new schemes will look like. They will be the product of a free negotiation between the management and the unions. They may decide to alter the way in which total benefits are divided as between lump sums and weekly payments. I do not know. I am really in no position this afternoon to give a binding commitment that the successor scheme will be as generous as, more generous or less generous than, the present scheme; but I do emphasise that it is not the Government's intention to require British Shipbuilders to reduce the level of redundancy benefit.
The Government have also made it clear that they will fund the non-statutory redundancy payments through public dividend capital. There is therefore no reason to assume that these new arrangements will mean that those who will lose their jobs after 1986 will in general be worse off than under the SRPS now in force. That is the reason for Clause 1: to extend the existing scheme against the background I have set out.
The Bill also presents a suitable opportunity to write off loans made in the period between 1968 and 1972 by the Shipbuilding Industry Board to Upper Clyde Shipbuilders, a company now in liqidation. Parliamentary approval is needed for this and to reduce the assets of the National Loan Fund accordingly. Warning of this was given in Accounts relating to issues from the National Loans Fund, which

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was published on the 12th December 1983 and presented to Parliament. This is really a book-keeping transaction and is dealt with in Clause 2 of the Bill.
I emphasise that the main purpose of the Bill is further to extend the scheme, which is valued by both the management and the workforce of the shipbuilding industry. We must hope that it does not prove necessary to make extensive use of the scheme; but surely no one can object to the continuation of this measure of support to those workers who are made redundant in a highly competitive industry such as the shipbuilding industry. With those remarks, I commend the Bill to the House.
Moved, That the Bill be now read a second time—(Lord Lucas of Chilworth.)
4.34 p.m.
Lord Bruce of Donington: My Lords, the House will be grateful to the noble Lord for having moved this seemingly innocuous little Bill which, on the face of it, goes to extend benefits already incorporated in the Shipbuilding (Redundancy Payments) Act 1978, as outlined in Schedule 2 of Statutory Instrument No. 916 of 1981 and as amended further by Statutory Instrument No. 1290 of 1982, with corresponding statutory instruments in Northern Ireland.
The Government were kind enough to pay high tribute to the workings of this scheme which, as the noble Lord has already indicated, has greatly helped to ease the passage of the reconstruction of the shipbuilding industry which has been occasioned by forces mainly outside the control of the industry itself. At the same time, the noble Lord has informed the House that the scheme is to come to an end in December 1986. In fact, that is automatically done by the repeal of Section 2(4) of the original Act of 1978—after which we are given to understand that a new scheme, which is to be negotiated between British Shipbuilders and the trade unions, will come into operation.
The noble Lord has indicated that it is his devout hope that the scheme, as negotiated between British Shipbuilders and the trade unions, will be no less favourable than the one already in existence. This brings us therefore to the question of why, then, has it become necessary to give notice of the termination of the scheme? If its continuance provides no greater drain upon public money than is involved in the scheme to be negotiated between the British Shipbuilders and the trade unions for a greater benefit, then why abolish it?
Quite clearly, the Government do anticipate making some saving. Moreover, we note that it is not to apply to those parts of the shipbuilding industry which are due for privatisation. The reason for that, as given by the Secretary of State in another place, is that to continue the existing scheme under the Shipbuilding (Redundancy Payments) Act 1978 and the subsequent statutory instruments would be expensive, bureaucratic and wrong in principle.
I find this a little odd. A scheme that has been in operation for a number of years, introduced by the Labour Administration in 1978, extended and approved in very glowing terms by the existing Government ever since and further extended today in so far as the public sector is concerned, is a most
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desirable thing. In fact, the Government, by inference, take credit for it and I am bound to tell the noble Lord, in so far as the noble Lord's bounty (or that of the Chancellor of the Exchequer) is to be extended for a further 18 months, his claim to benevolence is well justified. Why, then, should a scheme which is regarded in such benevolent terms in the public sector suddenly be regarded, if it is continued into the private sector, as expensive, unacceptable and, above all, wrong in principle?
It is when we consider these matters that this little Bill which is so innocuous becomes quite clear. It is a pre-privatisation Bill. Indeed, some hint of it is given in the text of the Bill by the writing off of some £2 million, to which the noble Lord has already referred. The real purpose of this Bill is quite simply to induce as much further redundancy before December 1986 as is possible in all the sectors, whether or not they are to be privatised, in order that when privatisation takes place on terms those taking over the warship yards will not be encumbered by what they regard as unnecessary staffs. It is therefore an invitation to further redundancy and there can be no doubt about it. The main purpose of it is to clear the decks for those private firms that will take over the warship section so that, by then, the further slimming down could have taken place.
Let us for a moment consider the scope of the negotiations that are to take place between British Shipbuilders and the trade unions. I am not suggesting that these negotiations will take place in any other way than with the utmost good faith, but they have to take place within the financial constrants under which British Shipbuilders are operating at the time. We know perfectly well that the warship yards are to be privatised.
There might be some slight, wry musing about this, because it seems odd to us that, in spite of all the virtues claimed for private enterprise ownership—initiative, drive, ability to take risks, courage, endurance and all the rest of them—they themselves never have to face the challenge of reconstructing an industry that is not doing well. Everything has to be dressed up beforehand, debts have to written off and prospective redundancy liabilities have to be got rid of. Then, and then only, under conditions of security, these courageous entrepreneurs are invited to come in and cash in on the proceeds. That is remarkable.
It is more remarkable in the case of the warship section because, as the noble Lord knows perfectly well, that section has contracts which run on a cost-plus basis and it is almost impossible for anybody to make a loss on them anyway. So they are presented with almost cast iron profitability, as history has shown, to those who take them over. Of course, all these measures will have to go through your Lordships' House and another place. However, on the assumption that they all go through successfully and there is no uncovenanted intellectual conversion by your Lordships to the arguments which I shall produce at the time, British Shipbuilders will be some £33 million short of profitability which they would otherwise have been able to apply against the losses which I fear they are still going to make, for reasons which I shall presently describe.

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So when it comes to the scope of the scheme, Mr. Day will not be able to negotiate from a position where he anticipates relief of his financial position to the annual tune of some £33 million from the warship yards. He will be £33 million short. When it comes to assessing the viability of British Shipbuilders, this is a significant sum that he has to take into account. Indeed, he could say to the trade union side in good faith, "I am sorry chaps. Eighteen months or so ago we were £33 million better off than we are now. Now we are a bit constrained and we really cannot afford to carry on a redundancy scheme which is anything like as favourable as before."
Moreover, the ways of Her Majesty's Government are by now well-known to this House. If Her Majesty's Government want a particular authority to take a line that they want carried out, they have very good means of ensuring that. It will be within the recollection of your Lordships that we have discussed—albeit by question and answer—the whole question of the increase in water rates, which has been imposed by the Government quite arbitrarily insisting upon different levels of profitability than have hitherto been obtained and upon an early repayment to them of sums due. What is to stop Her Majesty's Government, between now and the time when these negotiations take place between British Shipbuilders and the trade unions, from imposing similar constraints that make it quite impossible for British Shipbuilders to achieve any kind of arrangement with the shipbuilding trade unions, in order to achieve a redundancy scheme which is even remotely comparable with the one which they now enjoy under statute?
The answer is of course that the Government want to save money. If the Government say no they do not want to save money, then the answer is very clear. They can allow the existing Act to stand, particularly Section 2(4) permitting further extensions of the scheme. On the other hand, they can say, "Of course, we are going to save a lot of money on this", which will only go to fortify the suspicions of those who are engaged in the industry that, after all that, they are not going to do as well as they did before and it would be better if they got out.
In the course of his opening remarks, the noble Lord made some observation about the future of the British shipbuilding industry. He referred, although I think his confidence was a little muted, to the prospects for the success of what remains as the rump of British Shipbuilders. He knows perfectly well that the policy of open and unrestricted competition, which is the fetish and the passion of this Government, has been one of the factors which has led to the continuing losses of British Shipbuilders. He knows perfectly well that the Government's deliberate exposure of British Shipbuilders to competition from Korea has been one of the principal reasons why there has been such a fall-off in the orders to British Shipbuilders, as well as to other countries. The noble Lord knows perfectly well that the Korean shipyards are financed very largely by capital originating in the United Kingdom, in the United States and in Germany, on which dividends have to be paid. They know perfectly well that South Korea is not a democracy. It is in fact a dictatorship. They know perfectly well that the trade
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union movement there is comparable in status with the trade union movement in Poland; that the wage rates in Korea are one half of what they are in Western Europe, one half of what they are in Denmark and one half of what they are here.
The noble Lord knows perfectly well that there has been a deliberate exposure—and I do not want to rake over old embers—in fact in one case, in the case of a GEC cable layer, a Government encouraged diversion of a contract to Korea. He knows perfectly well that in this country only 44 per cent. of orders for shipbuilders from British shippers come to the United Kingdom as against 98 per cent. in Italy, 82 per cent. in Germany and 100 per cent. in Japan.
He knows perfectly well that it is only owing to the deliberate dogma of the Government that the fate of British Shipbuilders and of the entire shipbuilding industry has been left to the harsh winds of competition whether they be fair or unfair, whether they come from dictatorships, or from wheresoever they may come. This has been done as a deliberate act of policy in contrast to those of our colleagues in the Western world who deliberately give preference to the products of their own countries.
A day or so ago—it may have been only yesterday—we had some questions and answers on the precarious state of the merchant fleet in this country. I believe that the Question was answered by the noble Lord, Lord Brabazon, who indicated that some inquiry was going to be held into the military implications—or should I say the naval and military implications—of the progressive deterioration in numbers and tonnage of the British merchant fleet. Although I do not wish to hold it as a bogey, on the Government's own assumptions the Soviet Union now leads the world in the ever-increasing number of her merchant ships. I do not expect for one moment that these will have any impact on Her Majesty's Government. They have their dogmas and they must live with them.
I am quite convinced in my own mind about the Government's intentions. I am fortified by the views on this of Sir Robert Atkinson who indicated quite clearly as recently as August of last year that Sir Keith Joseph, who supported the hiving-off of warship building, offered no hope at all for the future of the British shipbuilding industry. Indeed, if noble Lords are familiar with the Observer feature of 12th August 1984, they will note—this has been unchallenged anywhere—that Sir Robert Atkinson in reporting a conversation that he had had with a senior civil servant in the Ministry said,
"that the policy of the Government was to get rid of shipbuilding altogether".
That statement has never been challenged. It is in fact implicit in the Government's actions; it is implicit in their ineptitude; it is implicit in their dogma; that, regardless of the fate of people in the United Kingdom, regardless of the fate or futures of skilled artisans in more than a dozen trades in this country, as long as the dogma goes, as long as the dogma is carried on, it does not matter a hang what happens to British industry as a whole and to the shipbuilding industry in particular.
One can be fanciful as to what the position may be in about 10 years' time on the assumption that the

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country is prepared to endure a further period of this wretched Administration. However, I can envisage a time when, secure under their nuclear umbrella, thousands of people will be tapping out messages to one another all over the world. We shall have a greater tonnage of computer paper than we have a tonnage of ships under the British flag and constructed in British yards. We shall probably have more stockbrokers than we have ship workers.
Noble Lords opposite are under a complete illusion if they think that they are going to achieve that without very much trouble because implicit in it is a complete disregard of the whole maritime history of this nation and of the whole of its build-up based upon the design, construction and the marketing of things rather than the marketing of information and the shovelling about of pieces of paper. This is a bad and a squalid little Bill which of course will receive your Lordships' assent as usual. Nevertheless it is merely a pre-privatisation Bill and can be condemned purely on that account.
Viscount Massereene and Ferrard: My Lords, before the noble Lord sits down, may I point out that I had an interest in shipping once? May I say with due respect that the noble Lord has been speaking a lot of nonsense? I would draw the attention of the noble Lord to the British liner, "Royal Princess", which was built in Helsinki at a cost, I think, of £130 million. No British yard could fulfil the order. The noble Lord knows perfectly well why British yards could not fulfil it. They could not do it because they could not guarantee the delivery date. Why could they not guarantee the delivery date? They could not do so because the unions might have had a strike or a go-slow, and of course under the law as it stands, there is no forcible agreement between shipbuilders and unions that can prevent that.
Lord Bruce of Donington: My Lords, I am most grateful to the noble Viscount for his very courteous intervention. He is of course himself entirely wrong. But this of course is not unusual. Every time there is an interruption in production and delivery date has to be postponed the noble Viscount has almost a Pavlovian reaction—it must be due to restrictive practices; it must be due to difficulties with the work force, and so on. I have a very simple answer to that—a fish rots from the head, not from the tail.

NHS: Drug Prescribing
4.58 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur): My Lords, with the leave of the House, I shall now repeat a Statement being made in another place by my right honourable friend the Secretary of State for Social Services. The Statement is as follows:
"With permission, Mr. Speaker, I will make a Statement on the limited list of NHS drugs.
"I told the House on 8th November that the Government intended to introduce a system under which a selected range of drugs would be available on the National Health Service in seven categories. These were: antacids, laxatives, analgesics for mild
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to moderate pain, cough and cold remedies, bitters and tonics, vitamins, and tranquillisers and sedatives.
"I published at that time a provisional list of medicines which might be selected within each category. This was the basis for consultation which continued until the end of January. We made clear from the outset that our intention was to produce a list from which doctors would still be able to meet all the clinical needs of their patients. The chief medical officers of the health departments wrote to all doctors individually to seek their views on the list. I am grateful to all the many doctors who responded and I hope they will recognise that their views have been taken into account. My chief medical officer also brought together a group of independent experts practising in the relevant medical specialties, including three general practitioners and a pharmacist, to assist him. That group has now unanimously recommended a list of medicines which they believe will meet all clinical needs. I have accepted their advice in full and I am most grateful for their help in this important task.
"This extended list of medicines will contain some 100 different medicines, compared with 30 on the provisional list. Most of the medicines will be generic, or unbranded, products; but a number of proprietary medicines will be retained where the group concluded that they were necessary and where no generic preparation currently exists. I should emphasise that the quality of all the selected drugs is assured. They all conform to the very high standards we require of all medicines under the Medicines Act.
"For the purposes of the regulations which my right honourable friend the Secretary of State for Scotland and I will introduce, it is necessary to list all the products which will no longer be prescribable on the National Health Service. The regulations will also cover those products which the Advisory Committee on Borderline Substances have advised are not medicines and should not be prescribed by general practitioners. I am today publishing both the selected list of drugs and those no longer to be prescribable. Copies are available in the Vote Office.
"I shall also today be giving the representatives of the medical and pharmaceutical professions the opportunity to comment on these regulations as they affect the terms of their contracts with the health service.
"Mr. Speaker, I should like to mention three specific issues concerning the operation of the limited list which have been raised during the period of consultation.
"The first is the question of the arrangements for reviewing the list itself. This was raised by, among others, the Royal College of Physicians. We fully accept that it is essential for independent professional advice to be available after 1st April on the need for changes to the list. I do not believe that complex machinery is required but I shall be very ready to discuss with the professional bodies concerned how the arrangements which have been used to formulate the extended list should be developed for the future.

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"Second, questions have been raised about the implications of the new arrangements for dispensing doctors—that is, doctors predominantly in rural areas who themselves dispense drugs to their patients. For these doctors, the regulations will in effect retain the status quo. Dispensing doctors will still be able to supply any medicine to those of their patients for whom they already dispense, although they will have to issue private prescriptions for medicines which are no longer available on the National Health Service. Concern has also been expressed about the position of retail pharmacists who now hold stocks of drugs which will no longer be available on the National Health Service. I am quite prepared to examine any relevant evidence that pharmicists may present on their stockholding of drugs.
"Third, the question has been raised whether there should be some form of appeal mechanism for individual cases in which a doctor believes it is necessary to prescribe on the National Health Service a medicine which will no longer be available. Most concern was expressed by doctors who felt that there were serious omissions in the provisional list. My unanimous medical advice is that the selected list is now comprehensive and will make it unnecessary on clinical grounds for patients to use medicines not on the list. Nevertheless, let me say this: if, after examining the complete list and in the light of experience, the medical representative organisations still wish to propose that such a mechanism should be provided, my right honourable friend and I will be ready to discuss it with them. I should make clear, however, that any mechanism would need to be very carefully controlled to ensure that it could only be used in genuinely exceptional circumstances.
"Mr Speaker, during the period of consultation a number of alternative proposals have been advanced. Yet none of these offered the same prospect of achieving sensible savings in the NHS drugs bill without either harming the interests of patients or threatening the fundamental and legitimate interests of the pharmaceutical industry. The selected list which I am publishing today is likely to produce savings in the drugs bill of some £75 million now, rising to a higher figure in due course. I am therefore convinced that the approach we have adopted remains the right one in principle. I also believe that the selected list which I am publishing today will demonstrate that in practice the health service will continue to provide all medicines required to meet the clinical needs of patients. It is by making sensible savings of this kind that we are able to provide the health authorities with the increased resources which I have announced recently".
My Lords, that concludes the Statement.
5.4 p.m.
Lord Ennals: My Lords, we thank the noble Earl for repeating his right honourable friend's long Statement made in another place. Make no mistake about it—this is an extremely important Statement. The
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decision taken by the Government is deeply disturbing; it fundamentally changes the relationship between the general practitioner, his patients, and the medicines he thinks are the most appropriate with which to treat his patients. The noble Lord said that eight doctors were perfectly satisfied that the list was all right. There are tens of thousands of general practitioners across the country, and every patient is different. The general practitioner knows better than any other person what is the best medicine for a particular patient.
The Statement spells the end of the clinical freedom enjoyed by the general practitioner, and it will create a two-tier system of treatment. First, there will be a limited list of drugs available on the NHS; secondly, there will be other drugs which can be paid for privately. It is therefore another step in the process of privatisation and towards undermining the basic principles upon which the National Health Service was created.
I shall not repeat today what I said last night about the effects of this development on the pharmaceutical industry in this country. If there is to be a list of safe approved drugs which can be made available on prescription, then it would be better to have a more comprehensive list than that originally published. In my view, a list of 100 drugs is quite inadequate. If there is to be both a black list and a white list, can the noble Lord say what will be the position regarding other drugs which are on neither the black list nor the white list?
Much more seriously, I have a number of questions for the noble Lord. First, can we have an assurance that this is not the thin end of the wedge; that safe approved drugs are not increasingly to be paid for by the patient? Will more drugs be added to the black list? Does the Statement affect the medical equipment needs of patients in their homes? Next, will not this list inevitably create increased costs for the elderly and disabled who are now exempt from payment, and who will now have to pay if it is the view of their GPs that the limited list does not meet the probably unlimited needs of the patients concerned?
Why have the Government taken this action? As the noble Lord understands very well, it has angered such essential professions within the health service as doctors, pharmacists and nurses, as well as the pharmaceutical industry and organisations such as Age Concern which are concerned with the needs of patients. Why have the Government rejected the recommendation of their own working party, embodied in the Greenfield Report, for generic substitution? This would have left with the doctor, ultimately, his clinical freedom.
This is an extremely important Statement, and yet none of us has seen the list published by the Secretary of State; none of us in this House is privy to it. We shall of course want to debate the Statement on the Floor of this House.
Lord Kilmarnock: My Lords, we on these Benches would also like to thank the noble Lord for repeating that Statement. But I must say that I am surprised that the noble Lord, Lord Ennals, awarded the noble Lord an Earldom on the basis of this Statement!
Lord Boyd-Carpenter: Promotion by merit!
Lord Kilmarnock: It seems to me to be a case in which primary legislation should have been used to bring in such a very important change in principle in the relationship between Government and doctors. Regulations seem to us to be quite inadequate. I start simply by saying that I regret that the Government did not accept the suggestion that I have made on two occasions that they should have kept their limited list weapon in reserve and convened a new meeting of all the interests concerned. I am sure that that was a mistake. I think that they had general agreement in the palm of their hand.
Can the noble Lord answer one or two specific questions? The Statement refers to the number of doctors who responded. Can he tell us how many of them did? He told us that the Secretary of State's unanimous advice was that all clinical needs would be covered. Clearly doctors up and down the country were not happy about this and have asked for an appeals mechanism. Can he tell us how many doctors wanted an appeals mechanism? In their increasing the original number of drugs from 30 to 100, I am glad of the Government's belated conversion to generic substances, but they have not gone about it in the way that we should have recommended.
Is it not carrying secrecy too far not to release the lists at the same time as the Statement? We are told that they are in the Vote Office but we cannot see them until this exchange has taken place. Can the noble Lord tell me whether Gaviscon is included on the permitted list, or whether Distalgesic, a very useful medium-range analgesic, is included on the list? Regarding the reviewing of the list, can the noble Lord be a little more specific about what type of body is to be set up to view new additions to the list? The Government say that they have accepted the need for independent professional advice. What kind of body do they envisage? Will it be more open than the internal departmental committee? Will it include the BMA and the Royal College of General Practitioners? Will the industry have a voice?
Finally, on the arithmetic, the number of drugs has gone up from 30 to 100. The projected savings have gone down from £100 million to £75 million. I am sure that the suggestion that I made to the noble Lord last night is much more accurate—that they will work out in the region of £40 million. How will any shortfall be treated from the point of view of the Government's commitment to 1 per cent. real growth per annum in the NHS? Will an arbitrary £75 million simply be lopped off that? How will the Government handle that in relation to their firm commitment to 1 per cent. real growth in the NHS? They will be watched very sharply on that.
5.13 p.m.
Lord Glenarthur: My Lords, I am grateful to both noble Lords for their comments and to the noble Lord, Lord Ennals, for his promotion of me, which I do not feel that I deserve.
Lord Boyd-Carpenter: It will come.
Lord Glenarthur: May I cover some of the points that have been raised? The noble Lord, Lord Ennals,
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accuses the Government of making a fundamental change. He knows quite well that the drugs bill has risen inexorably year on year. A total of £1,400 million is what we are talking about. That is why it is now necessary to make changes, so as to make it possible to improve other parts of the developing health service.
The noble Lord suggested that the GP knows his patients best. But I have to tell him that no fewer than three GPs were on the chief medical officer's specialist committee, and it was the unanimous view of that committee that the drugs contained in the list were sufficient to meet all clinical needs. The noble Lord, on the other hand, says it is his view that the drugs do not meet the needs of patients, but that seems to run counter to the theory which he has just advocated—that it is only doctors who really know.
May I answer the point that the noble Lord raised about other drugs, and say that of course the list with which we are concerned deals only with the categories of drugs to which I referred when I repeated the Statement. There are seven categories, and the other drugs remain as before. As I understand it, equipment will not be affected at all.
The noble Lord asked me a number of specific questions. He asked whether more drugs would be added. There are no plans to extend the list at all. We hope that it will be possible to achieve more sensible prescribing generally, and that is a theme which I think is also advocated by the noble Lord, Lord Kilmarnock, although he differs from the Government in the approach that he would make to it. But I have to say that all the signs are that more sensible prescribing generally is already happening.
The noble Lord asked about the increased costs for the elderly and disabled. It is certainly true to say that much of the publicity and fuss which has been created by a lot of people about this list has put genuine fear into the minds of the elderly and disabled—and misplaced fear at that. Although some of these drugs which have up until now been available over the counter anyway will not be available on prescription, I see no reason to believe that it will make life in the least bit difficult for those patients because their needs can quite clearly be met by the drugs which will continue to be available.
The noble Lord asked why we rejected the Greenfield proposal. We have discussed this matter before, and he knows that were we to have adopted that route we should have achieved less than half the savings to which the limited list leads us. The noble Lord can also be quite sure that, had we introduced generic substitution, that would have undermined the industry and made research not worth while, even into life-saving drugs. It would have affected all groups of drugs—advanced drugs as well. He can perhaps draw some comfort from the fact that we have not done that if he looks at the pharmaceutical industries of, for example, Australia and Canada.
Lastly, the noble Lord suggested that we should debate this. Of course the opportunity will come for that. The noble Lord, Lord Kilmarnock, suggested that what I am repeating now ought to have been done in the form of secondary legislation. The orders will be subject to the negative procedure. Regulations will be

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laid which will amend the National Health Service General Medical and Pharmaceutical Services Regulations 1974. That is the secondary legislation to which he refers.
To continue with some of the points raised by the noble Lord, Lord Kilmarnock, he asked how many doctors had made representations. The answer is about 1,670. I do not have the figures of how many were asking for an appeals mechanism; but I can tell him, as I said before, that the unanimous view of the committee was that the selected list met all requirements. But if the profession wishes to propose an appeal mechanism, we shall be very ready to discuss it, but it must be a carefully controlled mechanism and an exceptional one, and organisations like the BMA will have to be prepared to talk, which they have not been up till now.
The noble Lord asked about particular drugs on the list. He mentioned Gaviscon and Distalgesic Gaviscon is on the list. Distalgesic as such is not, but the procedure here is that Distalgesic is a combination of different drugs—paracetamol and dextropropoxyphene. There are three different brand names of that substance with exactly the same components. Doctors will still be free to provide the components, and they will have to write those two component names on the prescription form, not the brand name. The pharmacist will dispense one of the branded products for now but other companies will soon bring out generic versions, and that will allow genuine price competition. However, I ought to make it clear to the noble Lord—and I am sure he will be aware of this point—that Distalgesic has its own particular problems, and we hope that doctors will think carefully about when to use it. The noble Lord also asked about a reviewing list. We think that it is essential to have independent and professional advice. That independent and professional advice will consider the position of new drugs and whether there is a new suitable generic alternative to replace the branded drug.
Lastly, the noble lord challenged me on the question of savings, suggesting that the reduction from the figure of up to £100 million to £75 million was now inadequate. Of course, the consultation would always have led to a larger list and would result in less savings, but the aim now is to look for other ways of getting better value from the drugs bill through better prescribing, more competition in generic manufacturing and all that kind of thing. But the fact is that the vast majority of what is about 2,000 drugs which have come off the list lead us to a very substantial saving on the drugs bill, which can be put to other purposes in the health service which can so greatly benefit from that support.
Lord Auckland: My Lords, is my noble friend the Minister aware that his Statement is a marginal improvement on his reply in last night's debate? However, since the details of the Statement have not yet been read by us it is very difficult to comment specifically. With regard to the 1,670 replies my noble friend has had from the medical profession, can he say whether these are from general practitioners only or whether they are from the medical profession in
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general? Can he also say how long a period they have had in which to reply to a very important decision? Doctors are busy people. There is a feeling that the amount of time given to reply to these very far-reaching proposals may not be very long.
Lord Glenarthur: My Lords, the figure that I gave is roughly equally divisible between hospital doctors and GPs. They have had the same time as everybody else, which is three months, in which to comment on what the limited list contains.
Lord Monskwell: My Lords, can the noble Lord confirm that the financial penalties that may result for handicapped and old people as a result of these proposals will also apply to children who currently obtain free prescriptions under the National Health Service?
Lord Glenarthur: My Lords, I think the important point to bear in mind is that 72 per cent. of all prescriptions which are issued are already free and, of this particular group, 80 per cent. are free. So far as children, the young, the elderly, those on low incomes and those who require certain special medicines are concerned, they come into that percentage which I have just given the noble Lord. So far as particular drugs for children are concerned, certainly two of the more regularly used ones, that is to say calpol paediatric syrup and panadol elixir, are on the new list.
Lord Somers: My Lords, is not this decision really equivalent to saying that the doctor, who has, after all, the closest and most intimate knowledge of his patient, does not know what is best for him? The noble Lord must know that there are certain drugs which, while they are suitable for the vast majority of people, have very bad side effects on a small proportion of others and those others have to have something different. Will such people have to pay simply because they do not respond to the normal drug which is on the list?
Lord Glenarthur: My Lords, as I said earlier, the Chief Medical Officer's committee of experts have unanimously come to the conclusion, quite clearly, that all clinical needs will be met. Of course, the relationship between a doctor and his patient is important. But there is absolutely no evidence whatever to suppose that all clinical needs cannot be met by this limited range of drugs.
Lord Molloy: My Lords, is the noble Lord aware that the point raised by the noble Lord, Lord Kilmarnock, is giving grave concern to all parties on this side of the House? It seems that the Government are quickly developing the habit of first of all asking us to discuss what is really a fait accompli and reducing the role of Parliament to one that is perfunctory rather than one of debate and examination. That is a very distressing action for any Government to take.
The noble Lord said that the Government intend to invite members of the pharmaceutical organisations and industry to discuss this proposal and also to have discussions with other professional bodies. May I ask why they did not have such discussions before? The crucial point is this. Both the industry and other professional bodies may make suggestions and submit

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schemes which they think are superior to what the Government are doing, and can produce arguments which will be better—bearing in mind that the British Medical Association and the pharmaceutical associations constitute a few more than two or three GPs with whom the Government have had discussions.
Finally, we should bear in mind that this is really a money saving device. It has nothing to do with health. I do not think the Government really care whether any health will be injured by this act. Therefore, if there is a proposition to save money in some other way, without endangering the lives of people, should not the Government be prepared to consider it? I am sure such proposals will be made by both the industry and the BMA.
Lord Glenarthur: My Lords, I am not quite sure what particular question the noble Lord was asking. If he is spelling out the importance of the BMA in this issue, which he seems to be, perhaps he can tell me why the BMA would not come and talk to my right honourable friend the Secretary of State about it. So far as its being a money saving device is concerned, as I have stressed on several occasions from this Dispatch Box in the course of the last few weeks, the whole reason why it was necessary to produce a list was that the drugs bill was running out of control. It was becoming quite colossal. It has risen year on year quite out of proportion. It is a problem which has affected and faced, or should have faced, several Governments for many years in the past. The fact is that we now have to get to grips with it.
When the noble Lord seems to allude to the suggestion that we ought to have consulted further before we actually produced the list, I am not quite sure what he means. Does he mean that my right honourable friend should have stood up in another place and said, "I want to consult on something but I cannot tell you what it is because that would prejudge the issue. Unless anyone succeeds in identifying what it is and objects within three months, I shall go ahead"? That really is an unrealistic way to proceed.
Lord Newall: My Lords, I wonder whether among all this gloom and doom my noble friend the Minister is aware that, having taken some soundings among GPs, I have discovered that they are most happy and very satisfied with the proposed list, fully realising that there is some need for this measure. They will be very satisfied with what the Government are proposing.
Lord Glenarthur: My Lords, I am very grateful to my noble friend. I, too, have asked for the views of certain GPs, as one is bound to do under these circumstances, and I find that my views coincide precisely with my noble friend's.
Lord Ennals: My Lords, in my original intervention, it was not my wish to promote the noble Lord, nor would it be my wish to demote him, because I know that it was not his Statement; it was the Statement of his right honourable friend and it is his right honourable friend whom we must blame. May I make two points? First, the noble Lord has not really answered the question about consultation. Surely he
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accepts that the Greenfield Report was the kind of document that should have gone out for consultation in order that all those concerned, general practitioners, pharmacists, the pharmaceutical industry, any of us here in this House or in another place, could consult about what they thought was the best way of dealing with the problem of the drugs bill. He will understand that I do not think any Member of your Lordships' House has suggested that there does not need to be some further savings in the drugs bill. The question is one of principle. I do not think the noble Lord has answered the question of consultation.
The last point I want to make is very largely the point made by the noble Lord, Lord Somers. Nothing that has been said by the noble Lord, or in the Statement that has been made, can satisfy me about the principle concerned. No list of eight experts, or of 80 experts or of 800 experts, can replace the judgment of one doctor about a particular patient. What I believe is quite wrong in principle about this proposal is the assumption that somehow or other you can group patients together and assume that all their needs can be met by just a limited list of forms of medication. Each patient is different. Only the doctor, the GP, can properly and effectively understand what is in the best interest of the patient. That is the vital principle that is being breached by the Statement made today.
Lord Glenarthur: My Lords, on the question of consultation, I do not think that I can add to what I have already said. The fact is that my right honourable friend announced a proposed limited list. We were fully aware, of course, that the list would be amended in the light of consultations for which my right honourable friend asked. There it is. The BMA refused to come and take part. That is its fault, not my right honourable friend's.
On the question of consultation on the Greenfield Report, I would say that it was an internal report. The Government adopted nearly all the recommendations that the report contained. But they did not follow the route of generic substitution, for the reasons that I have stated on many occasions in the past.
On the question of principle, there is absolutely no reason to suppose—the noble Lord is wrong to suggest—that the clinical needs of patients will not be met by this limited list. It is a very comprehensive list. It is available for your Lordships to see; it is available now in the Library. It contains a list of about 100 drugs which cover all clinical needs. A change it may be, but it is necessary to make a change such as this if we are to contain the alarming greater growth in the drugs bill to the detriment of other parts of the health service.
Lord Kilmarnock: My Lords—
The Earl of Swinton: My Lords, we have now spent 33 minutes on the Statement. I know that it is a very important Statement. However, we have recently had two debates on this subject. We have another Statement to come. The noble Lord, Lord Kilmarnock, has had a chance to question the Government and he did so at some length. I think that we should now pass on to the next Statement.

Skillcentres
5.32 p.m.
The Minister Without Portfolio (Lord Young of Graffham): My Lords, with the leave of the House, I should like to repeat a Statement on skillcentres being made in another place by my right honouranble friend the Secretary of State for Employment. The Statement is as follows:
"With permission, Mr. Speaker, I would like to make a statement about skillcentres. I advised the House on 29th November of the Skillcentre Training Agency's proposals to the Manpower Services Commission. On 24th January, the chairman of the commission informed me of the commission's conclusions. These proposals for the reorganisation of the skillcentre network are designed to eliminate the present waste of resources and to enable the funds thus released to be employed in substantially increasing the number of training opportunities.
"The proposals form part of the adult training strategy adopted by the commission over a year ago, after the widest possible consultation. Under that strategy the number of adults being trained under the commission's programmes is planned to rise to 250,000 by 1986–87. This is more than double the 1983–84 figure. It includes a substantial increase in the number of unemployed helped. All parts of the country will benefit from this expansion.
"The reorganised skillcentre network has an important role to play in this further development of training. I very much welcome the emphasis the centres are now putting on new and higher technology skills, which will now be more widely available. I have today confirmed again to the chairman of the commission further capital investment in the network of £10·5 million for 1985–86. The addition also of a new 300-strong mobile instructor force is an imaginative and positive innovation. It gives greater flexibility, and allows coverage in remote areas not previously covered by the skillcentre network.
"I have now considered these proposals, taking into account the evidence given to the Select Committee on Employment on this matter and all the further representations made to me. Following consultation with my right honourable friends the Secretary of State for Scotland and the Secretary of State for Wales, I have today written to the chairman of the commission. I am placing a copy of my letter in the Library.
"In my letter I have asked the commission to implement the agency's proposals. I have asked the chairman to make quite sure in doing so that where any closure is involved it should not take place until satisfactory alternative provisions have been identified. I have asked that the fullest consultation takes place with the staff and trade unions, with particular regard to negotiating new working practices designed to help the overall efficiency of the network, and to avoiding compulsory redundancies wherever possible.
"Mr. Speaker, these proposals for the reorganisation of the skillcentres make sense as a necessary
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step in improving the cost-effectiveness of training programmes thus enabling substantial expansion in training opportunities, for unemployed as well as employed people, throughout the country."
My Lords, that concludes the Statement.
Lord Dean of Beswick: My Lords, I am extremely grateful to the noble Lord for repeating the Statement made by the Secretary of State in another place, which he has done in his usual courteous manner. However, my praise stops there, because I find nothing in the Statement that gives me any comfort; nor, I think, will it give any comfort to unemployed people in the country. I should like to put some points to the noble Lord, and, in view of the time factor, I shall do so briefly.
The Statement mentioned the addition of a new 300-strong mobile instructor force as an imaginative and positive innovation. Can the noble Lord say, even though this is part of the Government's intention, that the loss of jobs in real terms amounts to between 400 and 500? I should also like to ask what is meant by the Secretary of State when he says that he has asked the chairman to make quite sure that no individual closure takes place until satisfactory alternative provisions have been identified. Does that mean that, before there were redundancies of any kind in the service in a particular area, alternatives would have to be available at that time and not at some later date?
Is it not also a fact that the Minister's proposals do not at present have the support of a majority of the members of the commission? Is it not the case that when the proposals were first carried to the Minister there was a 5 to 4 majority on the commission in favour of the proposals, but still some doubters among the five? I understand that one member, who was in favour of the proposals at that time, has changed his mind and written to the Minister to declare this. Is it not therefore a fact that the proposals do not represent the commission's view at this time? I should like to hear the Minister's view. It has a bearing on how the proposals are accepted in general by people involved. Is it not also a fact that a reputable firm of accountants carried out a review of the proposals as they stand and was unable to find any viability within them?
Baroness Seear: My Lords, from these Benches I should like to thank the Minister for repeating the Statement. Like the noble Lord, Lord Dean, I wish to ask what is meant by the phrase that no individual closure should take place until satisfactory alternative provisions have been identified. What are the criteria for deciding satisfactory alternative provisions? Is it a question of the remoteness of centres for training, so that people in some areas find it extremely difficult to go to skillcentres because of the distance when certain centres have been closed? How will this be determined? We should like more information.
At this point I part company with the noble Lord, Lord Dean. I welcome the changes that are going on, particularly the appointment of the mobile instructor force. A great deal of change is better done on site than in skillcentres. We may be moving towards a position in which more mobile instructors should be available so that people can be trained on the job in the setting where they are to work. This is often the best way to

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make training stick with the people concerned, rather than take them away and put them into a centre.
I should like to know what is being done to update the skillcentres that remain open to see that they are carrying out the kind of training that is required. It is no secret, I believe, that some centres have become somewhat out of date, possibly, although I do not know, because they have not received the kind of equipment that is necessary if training is to be relevant to modern requirements. It is surely better to have an effective team of mobile instructors, backed by up-to-date skillcentres, than to try to concentrate entirely on the skillcentres. The move is in the right direction. One wants, however, to see that both approaches—skillcentres and mobile instructors—are of the best kind that can be provided.
I should also like to ask about the use of the mobile instructors. A very important part of adult training is to deal with the long-term unemployed. It is intended especially for the long-term unemployed. The community projects are available for them, and training should be included in these projects. Surely the mobile instructors are precisely the people who could give effective training to long-term unemployed on community projects. One is appalled to be told that that training is not to be given in the course of the work on the community projects but only after people have been on them, in their own time, while they are not actually employed on the projects. This seems to be a singularly dotty way of doing it. If ever there was a place where learning for this kind of person is appropriate, it is actually on the job with a skilled instructor to help. To suggest that people should go to courses after they have done work on a project, instead of having the advantage of skilled instructors actually on the project, seems to me most extraordinary. I should be glad if the Minister would comment.
5.41 p.m.
Lord Young of Graffham: My Lords, I am grateful to the noble Lord, Lord Dean of Beswick, for his comments. I should say at the outset that some 1,050 staff of the Skillcentre Training Agency will be affected, but my right honourable friend the Secretary of State for Employment has asked the commission to consult fully with staff and trades unions, particularly in regard to avoiding compulsory redundancies, wherever possible. Redeployment, voluntary early retirement and compulsory retirement at age 60 or over will be explored first. Compulsory redundancy is expected to be necessary for only a minority of staff.
That is an unpleasant decision to have to make, but I believe it is important to look at what the adult strategy itself is out to achieve. It is a strategy which was accepted by the Secretary of State and recommended by the commission, and one which was evolved only after the fullest possible consultation with all interested parties. Furthermore, I should remind your Lordships' House that if we look at the percentage of those leaving skillcentres over the last few years and going into employment, either generally or in the trade they have just acquired, we will find that continually, from 1980, those coming out of skillcentres have been less fortunate than those coming out of colleges of further education; and that trend has continued to this day.
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If I were to be asked why that is, I would say that it is for the reason I discovered when I had the privilege of being chairman of the commission: that the skills required in the world of employment have changed over the last 10 years. What the Skillcentre Training Agency is doing today is taking steps to ensure that it provides for both unemployed and employed the skills which are required in today's world.
It is true that since the decision was made on 24th January one of the commissioners has written to my right honourable friend the Secretary of State for Employment. I have had the opportunity of reading that letter. The commissioner asked for the decision to be delayed. My right honourable friend has noted Dr. Green's point, along with other representations which we have received. Delay in implementing the Skillcentre Training Agency's proposals would jeopardise the major expansion in training opportunities planned in the adult training strategy, and every pound that has to be spent on subsiding skillcentres after 1st April 1986 will mean fewer people trained. In the end, we have to consider the position of both unemployed and employed in acquiring the skills they in fact require to hold their place in the world of employment.
I should repeat once again that as a result of the new adult training strategy no fewer than twice as many people will benefit from the new form of training being provided. I am afraid that I cannot help your Lordships in regard to any viability study prepared by a firm of accountants, but I can assure your Lordships that during my time the figures were gone into very seriously and that this decision was arrived at after looking at all the consequences.
In the Statement I have just read to the House my right honourable friend said that he has asked the chairman of the Manpower Services Commission to make quite sure that he will not ask for any skillcentre closure,
"until satisfactory alternative provisions have been identified".
Under the arrangements for the adult training strategy, and in providing for twice the number of people to be trained, steps are being taken to ensure that each region of the country has satisfactory training provision. The key point about the closure programme is that the Manpower Services Commission will take it upon itself to ensure that there is an adequate and expanded range of training available in the particular locality before it will proceed to the closure of the skillcentre.
I am aware of the point made by the noble Baroness, Lady Seear, about the community programme. That is a matter at which I have little doubt the Manpower Services Commission is looking in adapting training into the community programme for the help of the long-term unemployed. That is only a small part of the adult training strategy. The adult training strategy is about bringing unemployed and employed people to a full state of readiness so that we can regain our economic advantages in this world, and training as a whole is a vital part of it. The Skillcentre Training Agency will play a very valuable role in the provision of training. This is a difficult step. It follows one which has no doubt been taken in parts of industry so that they may bring themselves up to date. I assure your

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Lordships that at the end of the day it will result only in the provision of more and better training.
5.47 p.m.
Lord Elwyn-Jones: My Lords, I should like to ask the noble Lord some questions about two important commitments undertaken by the Secretary of State, according to the Statement. One was that all parts of the country would benefit from the proposed expansion, and the second was that no individual closure would take place until satisfactory alternative provisions had been identified. Unhappily, the Secretary of State did not condescend to give particulars about the detailed arrangements in different parts of the country. The information that I have about West Wales in general, and my native town of Llanelli in particular, is, to say the least, deeply disturbing. It may well be that there have been changes of mind since it was originally announced that the Llanelli skillcentre was to be closed. There have been discussions since then, and it may be that there has been a different decision.
When are we going to receive from the MSC the details of the arrangements in different parts of the country? In Llanelli there are over 38,000 unemployed people—an increase of 7,000 since 1982. That is an unemployment rate of 17·9 per cent., and it is still rising. The need for retraining and the market for it have correspondingly increased. In regard to the needs of the community, if the economy of the area is to survive and prosper a pool of labour is required, trained in the new technologically-orientated industries; so there is a greater need than ever before for more provision.
I do not know quite how that is going to be achieved by the threatened removal of the skillcentre and the survival of only one, apparently—in Port Talbot, which is miles and miles away from West Wales and from Llanelli. Perhaps there has been fundamental re-thinking, particularly bearing in mind that in the last three years the Llanelli skillcentre has been unique; it has been extremely successful. For instance, in 1981, while 80 per cent. of places were occupied, only 22 per cent. of the trainees were able to find jobs. In November 1984, 93 per cent. of all places were occupied and successful placements were found for a proportion well above the national average; so that is a skillcentre which is producing results.
It may well be that the noble Lord may not have information at his fingertips, or even a note hurriedly provided from the place over yonder, to deal with my questions, but I assure him that there is very grave concern in the part of the country about which I have information which does not at all fit into the Statement by the Secretary of State that all parts of the country will benefit from the expansion. Therefore, I assure the noble Lord that we anxiously and urgently await the precise particulars which are needed before these assurances achieve any reality whatever.
Lord Young of Graffham: My Lords, I am extremely grateful to the noble and learned Lord, Lord Elwyn-Jones, because, while I have every sympathy with what he has said, his remarks in fact demonstrate the very real difficulty which has been besetting the Manpower
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Services Commission in the provison of training. Without wishing to bore your Lordships' House, I should like to say a few words about the general and then a few words about the particular.
At present, the skillcentres have a capacity for 17,700 people within the existing network, and they have about 12,500 places filled. After the reduction the capacity will be about 13,200. Therefore, this is in some ways a reduction which is more apparent than real, save that it is real because the amount of money that will be saved in a full year will be approaching £50 million, which will otherwise be spent in the real provision of training throughout the country.
I point out to the noble and learned Lord that, during my time at the Manpower Services Commission, Llanelli was not far from my thoughts. It was often considered. I should also like to say that, as a result of the adult training strategy, the provision of training within the Principality of Wales will, in 1985–86, be 60 per cent. greater than in 1984–85, in terms of the number of people being trained. That, indeed, is a very real advance. However, although the figures for placement—that is, for those going into jobs—in Llanelli and elsewhere have improved over the last few years, they still run substantially below the figures relating to the local colleges for further education and, in any event, run beneath half the figure for those actually receiving training. This represents not only a waste of resources but a grave disappointment to those, particuarly the unemployed, who go through a training course but are unable to find a job afterwards. It is not important that we train, but it is important that we train in the skills which will be required tomorrow. It is that with which the whole skillcentre reorganisation is concerned.
Lord Dean of Beswick: My Lords, I should briefly like to ask the Minister if he would once again look at the major point that I made. I am sure it was by accident that he missed dealing with it. I should like to know what is meant by the reference in the Statement that no individual closures will take place until satisfactory alternative provisions have been made. What does that mean?
Lord Young of Graffham: My Lords, I apologise for omitting to explain in full, perhaps, what I believe to be the meaning of that part of the Statement. It simply means that the proposals originated from the Manpower Services Commission and were made to the Secretary of State as part of the adult training strategy, and as part of the training strategy the Manpower Services Commission has undertaken to deliver training in all parts of the country according to the new plan. It would wish to identify the sources of the new training before it would seek to close any skillcentre. It is concerned to see that the adult training strategy is delivered, and delivered economically.

Shipbuilding Bill
5.53 p.m.
Second Reading debate resumed.
Viscount Simon: My Lords, in bringing the House back to the consideration of the Shipbuilding Bill I

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should like to apologise for the fact that I do not seem to have very much voice this evening, but fortunately for your Lordships and for me I also do not have very much to say.
I join with the noble Lord, Lord Bruce of Donington, in thanking the noble Lord the Minister for his introduction of this Bill: he certainly made it sound very simple. I listened with interest to the noble Lord, Lord Bruce, who certainly did not find it simple and thought of all kinds of implications which I am not prepared to follow entirely. However, in any case the noble Lord, Lord Bruce, broadened the issues of this Bill very widely. The noble Lord referred (as I was going to refer) to the exchanges at Question Time yesterday which elicited the fact that some serious investigation is to be made and has been undertaken into the adequacy of our shipping in time of war. In my view we must look at the subject very much more widely than that: we must look at the adequacy of our shipping and our shipbuilding to meet the country's requirements in peace as well as in war. For that purpose I suggest to your Lordships that a much wider debate is required. I hope that the noble Lord the Minister will suggest to his noble friend the Chief Whip that on a suitable occasion—and not too far ahead—time should be found for a wide-ranging debate on these allied subjects.
I turn to the Bill. As the noble Lord the Minister reminded us, when it was first introduced in 1978 the scheme was described by the Minister in charge of the Bill—Mr. Kaufman, in the last Labour Government—as intended to alleviate the human problems caused by any contraction of the shipbuilding industry. Therefore, unless we take the view that no further contraction is likely, it is surely wrong to remove that support now. For that reason, I should have thought that it was almost self-evident that the scheme ought to be extended. In fact, I would be inclined to ask why it should be extended for only 18 months. After all, if the position in the shipbuilding industry were radically to improve—as we would all hope, but perhaps not with much confidence—there would be no harm if the scheme still existed; it just would not be used. It would surely be much better to extend the scheme for longer than 18 months.
However, if such a course is difficult at this stage of our discussions of the Bill, then perhaps it would be better to introduce a clause which is quite common in Bills of this kind and which provided that the Secretary of State could, by order, extend it for a further period of whatever length was thought to be right. If, unfortunately, that then became necessary—and I am bound to say that I am rather afraid that it would become necessary—the whole matter could be dealt with without having to bring another Bill before Parliament. I should have thought that that course would be very much easier.
When the noble Lord the Minister addressed us, I was not quite clear about the Government's judgment. Is it presently the case that the Government believe that British Shipbuilders has now adequately skimmed down the size of the industry so that it can reasonably be hoped to survive on its own? I should not have thought so. We have all been heartened by some encouraging news in recent times, especially the large order won by Govan which was announced yesterday.
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But overall it seems to me that the outlook is extremely dismal. There remains massive overcapacity throughout the world in the construction of ships. I found little sign of any large recovery in demand. Therefore, I could not escape the conclusion that the scheme should be extended, and so I find myself in support of the Bill.
There is only one point upon which I should like to dwell a little longer, and that is the matter of the employees in those parts of British Shipbuilding which the Government propose to dispose of to the private sector. This matter was discussed in another place at considerable length. However, I am bound to say that, after reading through the debate, I was not very clear what decision had been reached. Has it not always been the policy that, when legislation is under consideration to transfer the ownership of particular undertakings from one body to another, from the private sector to the public sector or vice versa, Parliament has always taken the view (at least, it has always taken the view in my brief time here) that one of the most important things was to guarantee the conditions of work of the workforce? Why should that not equally apply when it is proposed that parts of the shipbuilding industry should be handed to private interests?
I appreciate that this is difficult, and it may be that it is impossible to apply the scheme in its present form precisely to those who will no longer be employees of British Shipbuilders. But I believe that we have a duty to make sure that in one way or another the employees do not lose these advantages merely because Parliament decides to transfer the undertaking in which they work to the private sector. When this matter was raised in another place the Minister could say only:
"There may be an opportunity to negotiate compensation".—[Official Report, Commons, 9/1/85; col. 827.]
He went on to emphasise that the employees who find themselves with a new master will have no statutory right. Is that really good enough? Should not employees in this position be given a statutory right? I suggest that it would not be very difficult to do this by making it a condition of the sale of any enterprise to a new buyer that the purchaser must provide the same conditions as exist today under the Bill. I hope that when the Minister replies he will be able to say something about that.
I want to refer to one other matter. When we say that the object of this whole exercise is to alleviate the problems which arise from the dwindling of the shipbuilding industry, surely there are other steps that could be taken in that direction? Can the noble Lord the Minister tell us whether anything is being done in the shipbuilding areas which have suffered so heavily (after all, the areas in which the shipbuilding industry provided most of the employment are fairly small) on the lines of what has been done, perhaps rather tardily, in the coal industry and what I believe has been done in the steel industry, actively to stimulate the setting up of new industries in those areas? I have never seen any reference to that; it may be that some work is going on. But I believe that, when we have this tremendous fall in the number of people employed, more is needed positively to encourage and make possible the

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introduction of new industries over and above what is already provided by the Government's regional policy.
Those are the only two points that I wanted to raise at this time. I look forward to the big debate, which I am sure we must have, but I think it would be better to have it at a time when we can devote a whole day to it.
6.3 p.m.
Lord Molloy: My Lords, as has been indicated by my noble friend Lord Bruce of Donington, I believe that this Bill has the wrong title. It is not a shipbuilding Bill at all; it is a Bill to prepare for the selling off, to private folk, of the British public's assets in shipbuilding, rather than that they should be owned by the nation. In consequence, the Minister painted the Government's usual plastic, rosy picture of how they will throw to the workers the redundancy lifebelt of cast-iron or both ends of the lifeline at the same time. What they are really doing is wrecking the old Red Duster, which has served this nation so very well for almost 100 years, in war-time and in peace-time.
I believe that it is a great tragedy that an industry such as the British shipbuilding industry should have been treated as it has over the past few years. As a consequence, I believe that the rosy picture of saving people from joining the dole line too quickly by offering some redundancy pay is an appalling policy. If we are to say that every time a few hundred thousand work people are sacked, it is quite all right because they will receive redundancy pay, we shall all be starving. It is an appalling policy.
My noble friend Lord Bruce mentioned the vast array of skills involved in building a ship. At one time no one could build ships like us. If the industry had been given some encouragement and the research, which was started four or five years ago, had not been abandoned, the probability is that British shipbuilding would have been picking itself up despite harsh competition. We must realise the skills and crafts involved in building a ship, the skills of British workmen—the carpenters, joiners, engineers, heavy and light electricians, shipwrights, boilermakers, "red loaders" (they are the rough painters who do a very skilful job in applying the first coat of paint), riveters, plumbers, cranemen, riggers, storemen, progress chasers, scaffolders, and the sheet metal and ventilating engineers. That vast array of British craftsmen will be dispensed with by this Conservative Government. That is one thing that Mrs. Thatcher is not telling the Americans, or for that matter anyone else.
Therefore, I believe that the end of redundancy in 1986 means much more than just the end of redundancy. There will be no schemes for craftsmen who are sold off to private organisations but only, as the Bill indicates, hopes of a scheme which might be negotiated. I ask the Minister for an assurance that such schemes will be as good as the one which exists at the moment.
Privatisation threatens the future of shipbuilding craftsmen engaged in sectors where promises have already been given that they will be sold off. Consequently, I can understand that these workmen
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have been tempted to apply for redundancy now, and that they want to ensure that the compensation which is paid now is better than nothing when privatisation becomes a reality. They do not want to give up their jobs; they do not want to lose their crafts. But they sense that the Government's policy is to end British shipbuilding; so they think that they will get out now and receive £2,000. I believe that any Government which put that kind of thought into the minds of the craftsmen whom I have listed ought to have second thoughts.
This is a sinister Bill. Perhaps I may quote from Lewis Carroll. The way in which the Government are doing this reminds me of the lines:
"How cheerfully he seems to grin,
How neatly dressed his claws;
and welcomes little fishes in—
with gently smiling jaws".
But this Government are not so much a crocodile but more a shark, floating around on the political scene to look after one tiny sector of their political supporters and ignoring the mass of workmen who are the real creators of the wealth of our nation. We saw this when the workers at the Tyne Shiprepairers were bought out of a scheme. Then—as even now—craftsmen who left British Shipbuilders were compensated. Those who leave after 1986 face the possibility of suffering tremendously and getting nothing.
What does this add up to? Workers in yards to be privatised leave. They receive the benefit of redundancy pay. This advantages the purchasers—those about to buy—and privatisation. Half the work force is bought off, not by them, but by the taxpayer whom this Government love so much. That is who will pay the redundancy, ready for the private people who will purchase what is left of British industry. There will be a smaller work force and, of course, there will be no social obligations. That bill is going to be left for the taxpayer.
There is great worry and fear, and it is dominant in the industry at all levels. There has been a crisis for a number of years. The agonies of this crisis in our shipbuilding industry have been shared right from the top industrialists down to the craftsmen who work to make a reality where at first there is nothing but a few lumps of wood at the bottom of a dry dock and where there emerges a massive ship. Over the last few years they, too, have been wondering when is something going to be done.
My noble friend Lord Bruce of Donington quoted the chairman of British Shipbuilders, Sir Robert Atkinson, and I should like to quote what it was said that he had uttered. In another place, as reported in Hansard, at column 797 of 9th January, my honourable friend Mr. Smith said that Sir Robert Atkinson had said that,
"during his period in charge of British Shipbuilders he was never asked by Ministers about research and development and about the future of the industry. He added: 'But if I talked about closures or redundancies, their eyes shone'. That is the former chairman of British Shipbuilders…".
That was not from an extreme left-wing politician; it was from Sir Robert Atkinson himself. I would have hoped that this Government would at least have taken some cognisance of what he had to say.
Our island, Great Britain, is a maritime nation, and I believe that it is essential that we should have a

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proper shipping industry. If we are going to have a shipping industry—because there is a difference; and it is vital to this country—we must have a shipbuilding industry. A shipbuilding industry is crucial to a shipping industry. Therefore I believe that we ought to end the folly of this privatisation. I hope that the Government will have second thoughts and put the nation before their private political friends, irrespective of what party they might belong to.
It is true that we were up against it in the past few years against Japan and Korea. Much of our British skill was exported over there, and the Government should have been aware of that at the time. But now what should we do? It is not too late. We should establish a Royal Commission to look at this fundamental and great British industry of shipbuilding, which is so vital to a maritime nation.
It is sometimes said that Royal Commissions take a long time. We have all said that, and we all know it, but I am of the opinion that there are enough experienced Members in this House who know full well that often Royal Commissions have been a boon. Admittedly, they need to be stirred up now and then. If a Royal Commission were established, it could be told, under the terms of reference, that it had about 12 or 18 months to report. With the best minds in Britain concentrating on this subject, something would emerge which would help us. I want to see manufacturing industry given at least the same importance, if not more, than is presently being given to the service sector.
This Bill also provides for more unemployment. I do not believe that that is a humorous matter in any way. More unemployed! We have 4 million unemployed. The dole queues will be lengthened by the list of skilled craftsmen who will not be building ships under this Government but will be getting a few pounds redundancy money; and then, it seems, they will for years be joining the dole queues. There will be more unemployed; more degradation; more upsets in families; and more hopelessness for British craftsmen.
Let the Government show confidence in this industry and in the men at all levels who work in it. Let us plot a new course for the British shipbuilding industry. Let us acknowledge that this shipbuilding industry is a great industry, and that if we are prepared to say so, we can chart a course so that it will sail into the seas of success. I have some knowledge of this industry, of all the men who work in it from the top levels of management right through to all the skilled craftsmen, and I believe that this is a valuable asset for my nation. The Government should have second thoughts and save this industry from the destruction they are anticipating.
6.15 p.m.
Lord Lucas of Chilworth: My Lords, I am grateful to the four noble Lords for their positive contributions this afternoon. Perhaps, however, they were positive contributions which might have been better placed were we discussing the shipping industry in the wider context. I find it absolutely incredible that when we come forward with a Bill to extend for 18 months a scheme to help those who suffer the hardships inherent in a declining shipbuilding industry—a shipbuilding
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industry that is declining across the world—noble Lords should attack us and accuse us, the Government, of having some devious reason.
The noble Lord, Lord Bruce of Donington, said in his opening remarks that it was a "seemingly innocuous little Bill", and he ended up in somewhat robust and characteristic fashion by saying that it was a "squalid little Bill". There is nothing squalid about continuing a scheme which cost some £36 million last year, and probably a little less this year, to alleviate the hardship, on top of—if I may remind your Lordships—the normal Department of Employment redundancy payments scheme. I do not find that squalid at all.
The noble Lord, Lord Molloy, and the noble Viscount, Lord Simon, asked for a debate. That is not within my gift. They have their Chief Whips. If they care to give up their day to debate the industry, I know that either my noble friend Lord Brabazon of Tara or I, or another noble colleague, will be delighted to answer such a debate. But let us now just have a look at what has been happening—
Viscount Simon: My Lords, before the noble Lord leaves that point, may I ask him whether he is saying that this enormously important issue cannot be discussed in Government time?
Lord Lucas of Chilworth: My Lords, I did not say that. I just suggested that if they wanted to debate it, they might ask their noble friends the Chief Whips whether they had the time. I do not know; I cannot answer that. It is not for me to answer.
I want briefly to refute the charge that we have abandoned the shipbuilding industry. Nine-hundred-and-thirty-four million pounds in public dividend capital since nationalisation has gone into the shipbuilding industry. Another £250 million has gone to British Shipbuilders from the intervention fund. Sadly, although some of that money has gone into re-equipping some of the yards, the vast majority of it has gone to fund production costs. It has in fact gone to fund bad debts from the years when the industry was nationalised. There can be no doubt that plenty of support has been given.
When this Government came into power in May 1979 we introduced some reality into the business, on the basis that you cannot continue to throw good money after bad. That is exactly what we have done. The industry is better today than it was. It is more competitive. I said earlier this afternoon about Austin and Pickersgill that when disaster threatened them in the face only a few weeks ago it did not take long for management and unions to find new working practices and arrangements which secured for them an order.
I totally refute the argument that this Government have abandoned the industry. If this Government have abandoned anything, it is the principle of throwing good taxpayers' money after bad in a declining industry. We have done much to alleviate the hardship outside by paying redundancy payments. There is no doubt about that.
The noble Lord, Lord Bruce of Donington, and the noble Viscount, Lord Simon, in a different way, asked me why we have given notice of discontinuance of the

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scheme at this time. The Bill does not abandon the scheme at all: it continues it for 18 months. In the past we have had extensions of two years and two years. What we have said—and I give notice today—is that we do not see the necessity or the desirability of continuing the scheme after 18 months or so. There is no case for maintaining the bureaucracy of a statutory scheme for the two nationalised concerns after 1986.
Although I do not look for further redundancies, should there be some, both British Shipbuilders and Harland and Wolff will be employing, as I said in my opening remarks, one-third of the entire industry. Is it right that one-third of the industry should have preferential treatment? I do not believe that is so, and that is why I gave notice today, which is a proper and honourable thing to do, that this is our current thinking. There might be some truth in the allegation made by the noble Lord, Lord Bruce of Donington, were I to have withheld that information.
I find it not untypical of the noble Lord, Lord Bruce of Donington, to seek to find the very worst aspects of our Bill. He said to us this afternoon that the Bill provides the means to induce much redundancy before privatisation in order to enhance the value to the private sector. I do not say that I have quoted him absolutely precisely, but I wrote down those words. What a perverse way of looking at things! I sometimes despair.
Lord Bruce of Donington: My Lords, if the noble Lord will excuse me for just a moment, he is very courteous and I am much obliged to him. The noble Lord seemed to indicate that the decision of the Government to terminate the scheme in December 1986 was not final. I refer the noble Lord to column 51 of the proceedings of the second day of the Standing Committee in another place, where the Minister's statement is quite specific. He was asked the question whether the present scheme would end in December 1986:
"Am I correct?"
"Mr. Butcher: Absolutely".
Lord Lucas of Chilworth: My Lords, I do not know why the noble Lord should have read that out, because that is exactly what I said. We have given notice—and I repeated that notice in your Lordships' House this afternoon—that it is our intention that the scheme shall end in 18 months, in December 1986. That is 18 months from June 1985. I do not know what the noble Lord is arguing about, because I am not arguing. I am saying that this Bill does not stop the scheme. We have given notice of our intention that it will stop. In other words, we have given notice of our intention that in December 1986 we shall not be bringing forward another Bill to extend the life. That is fair, reasonable and proper.
We have said that we will underwrite the cost of a successor scheme through the public dividend account. I do not know what can be more honest and open than that. What I do say without any shadow of doubt in answer to the noble Lord, Lord Molloy—who, in his usual voluble way and emotive words, said, "We are wrecking the Red Duster" is: what an absolute lot of nonsense! We are ensuring that
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we do not continue to fossilise our industrial structure by pouring in more and more money and deriving no benefit. What we have to do—and he jolly well knows it—is to facilitate essential change. We have at the same time to pay regard to those people who suffer thereby. It is not just a couple of thousand pounds, as he said—
Lord Molloy: My Lords, may I—
Lord Lucas of Chilworth: My Lords, perhaps the noble Lord will allow me to finish. If a man aged 50 with 20 years' service accepts redundancy, he receives a cash lump sum payment of £5,300 and he receives £46 a week for two years. That is on top of the ordinary employment redundancy scheme arrangements. I do not believe that that is just a couple of thousand pounds.
Lord Molloy: My Lords, the idea of this Bill is to privatise the shipbuilding industry, and then it will be purchased by certain people thinking that they will make a lot of money out of it. But if the Minister keeps up his argument now the Government will be lucky if they can give it away.
Lord Lucas of Chilworth: My Lords, notice of the Government's intention to sell a number of the yards was given. I repeated it in your Lordships' House over a year ago. This is not a privatisation measure. If those who buy the yards are able to make a profit, that will be absolutely splendid because the nationalised industry has not made a profit. It has made losses successively year after year, as high as £161 million. If somebody can turn that into profit, I think that is splendid.
I do not think there are any other main questions to be answered, other than one asked by the noble Lord, Lord Bruce of Donington, in relation to the writing off of the Upper Clyde Shipbuilders' loan. He said that that was linked with privatisation. Of course, it is nothing of the sort. It has nothing whatsoever to do with privatisation; nor has it very much to do with British Shipbuilders. It writes off a loan which was made directly by Government to a company which went into liquidation in 1972. It is sensible to remove from the accounts an amount of that kind.
The noble Viscount, Lord Simon, thought that perhaps we should require new owners to offer the same redundancy schemes as apply now. While in general terms any new owner who buys an undertaking from the state accepts in principle the contractual obligations with regard to work methods, employment conditions and so on, including redundancy schemes, it would be quite wrong to bind that new owner to schemes, particularly in the shipbuilding industry, which has grasped the nettle and the men in which have grasped the nettle. They have responded to change, and it is up to the companies to negotiate those changes with the new employer.
I do not know why the noble Lord, Lord Molloy, laughs. I said at the outset that this is a simple and generous, small Bill. It will go some long way towards ensuring that the hardship that occurs in necessary change is alleviated to some extent. I ask your

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Lordships to give this Bill a Second Reading this afternoon.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Prevention of Terrorism (Temporary Provisions) Act 1984 (Continuance) Order 1985
6.30 p.m.
The Minister of State, Home Office (Lord Elton)The Minister of State, Home Office (Lord Elton) rose to move, That the draft order laid before the House on 12th February be approved. [12th Report from the Joint Committee.]
The noble Lord said: My Lords, the draft order has been considered by the Joint Committee on Statutory Instruments, which made no comment.
This order is made under the Prevention of Terrorism (Temporary Provisions) Act which your Lordships placed upon the statute book not quite a year ago. Subsection (1) of Section 17 of the Act provides that it shall remain in force for 12 months from the date on which it was passed and that thereafter it can be renewed for not more than 12 months at a time. The total life of the Act is limited to five years. The purpose of this order is to provide the first renewal of the Act and so provide it with its second year of life, starting on the 22nd of next month.
When the House debated the report in Committee, a number of your Lordships were concerned that a measure which touched the civil liberties of individual citizens so closely should be subject to more than usual scrutiny once it was in operation. You felt, in particular, that the House should be informed of the way in which the authorities had used the powers which it gave them and that this information should be available before I came to the House for a renewal. When your Lordships discussed the Bill at the Report stage I undertook that an independent person of stature would be appointed to report on the working of the Bill, and that his report would be available before the debate on renewal took place. Your Lordships will know that Sir Cyril Philips was appointed last year to consider the working of the Act. His report has been received and it was placed in the Printed Paper Office last Tuesday. My right honourable friend replied to the report, and to specific points and suggestions in it, by letter and that letter was placed in the Printed Paper Office yesterday.
I think your Lordships will agree that Sir Cyril, who has had the considerable advantage of four years' experience as chairman of the Police Complaints Board, has gone to considerable lengths to do his job thoroughly. The result has, I believe, been a broad endorsement of the way in which the powers that the Act provides have been used; but it does not amount simply to blanket approval, and your Lordships will note that he has made a number of detailed comments on the way in which the Act is operated. These touch in particular on the way in which custody record sheets are maintained, on the identification of complaints made about the way the powers given by the Act are used (31), on the numbers of landing and embarkation cards that ought to be filled in, and on the way in
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which inquiries are made after embarkation cards have been completed.
My right honourable friend responded specifically to each of these points in the letter which your Lordships have before you, and I shall not repeat what he has said. On the fourth point, however, which deals with landing and embarkation cards, he did say that he hoped to make an announcement today. The question at issue is whether or not every passenger travelling between the Republic of Ireland or the Province of Northern Ireland and ports in Great Britain should be required to complete a landing or embarkation card. The proposal for this was made by my noble friend Lord Jellicoe in his report on the working of the earlier Act, and my right honourable friend has already had it under consideration. Since the recommendation was made, he has received a report from Her Majesty's inspectors of constabulary on the work of the police operating the port controls provided under the Act. We welcome the thorough and perceptive study which Her Majesty's inspectors have undertaken, and the detailed recommendations in the report are receiving careful consideration. In the context of the same study, Her Majesty's inspectors were asked to assess the implications for resources of the recommendation by my noble friend that all passengers on commercial flights and sailings between Great Britain and the island of Ireland should complete landing and embarkation cards. In the light of their conclusions, and taking into account all the views that have been expressed on the security and other considerations, my right honourable friend has decided that it would not be appropriate to implement Lord Jellicoe's recommendation, and that in general a more selective use of these cards is to be preferred.
As your Lordships will recall, the present Act made a number of changes to the 1976 Act of the same name, most of which followed recommendations made by my noble friend Lord Jellicoe in his review of the earlier Act's operation. Your Lordships may like to have an indication of the practical results that those changes have produced. Perhaps the most significant change was the extension of the powers of arrest and detention under Section 12 of the Act to those involved in international terrorism. My noble friend drew attention to the growing threat from this source: this comprises not only terrorism that is directed deliberately at British citizens or British interests, but also the wholly unacceptable use of our country as an arena for quarrels in which we have no interest and for which we have no responsibility. The events of the past 12 months have demonstrated all too clearly that this threat has in no way abated. Only weeks after the Act was passed, we saw the foul murder of WPC Yvonne Fletcher in St. James's Square. In the period from 22nd March to 31st December, 44 people suspected of involvement with international terrorism were detained at the ports or inland under the prevention of terrorism legislation. In 18 of these cases my right honourable friend authorised extensions of detention beyond 48 hours. In eight cases criminal charges were brought and in 13 the person was either deported or removed under the Immigration Act 1971. In only one case in which the person was held for more than 48 hours was he released without charge and allowed to remain in this country.
During the passage of the Act the Government responded to the legitimate doubts that were raised about the scope of these new powers by giving the assurance that they would only be used when there was some prospect of a criminal charge in this country or of deportation. I believe the figures show that the police and my right honourable friend have kept very closely to these criteria. Another important change in the present Act was the introduction of flexibility to the Secretary of State's power to extend detention. Under the earlier legislation, it was possible only to authorise a single extension of five days; it is now possible to grant one or more extensions of any shorter period of up to a total of five days. Our intention was greater control of the use of extended detention so that detainees might spend less time in custody as a result. In the period to 31st December, of the 147 people held under the Act in Great Britain, 35 had their detention extended. In only 11 of these cases was there what one might call an "old style" single extension of five days; in a further 10 there were two extensions totalling five days; and in the remaining 14 there were single extensions of between one and four days. It seems that this change is having the result we hoped for from it. Your Lordships will see from the figures I have given that 112 of the people detained were held for fewer than 48 hours. And there is another change.
The current Act, unlike its predecessor, deals with international as well as Irish terrorism. In order to see the change therefore we need to look specifically at cases in Great Britain relating to Irish terrorism, for which we have figures over a number of years. If we take the total number of detentions, whether extended or not, we find that in 1975, when the use of the powers was at its height, there were 1,067. In 1984, on the other hand, there were only 159, which was in fact 32 less than in 1983 and the lowest so far. There has also been a reduction in the number of exclusion orders for Irish terrorism from 50 in 1975 to merely three last year, which is also the lowest ever and 12 less than in 1983. This continued reduction is very heartening and it will surely be welcomed by us all. But it does not mean, however, either that these powers are now unnecessary, or that the system of controls directed at Northern Irish terrorism can now be dismantled.
After a year which has seen the bombing of the Grand Hotel, Brighton, in a cold-blooded and barbarous bid to blow the democratic process in this country to smithereens, we surely need no other reminder of the constant threat posed to the mainland of Great Britain by Irish Republican terrorism. But equally, if we were to abandon these powers, we would be turning our backs on the Province itself, where that threat and its realisation are facts of daily life. In Northern Ireland, there were 908 detentions under the Prevention of Terrorism Act in 1984; and in 533 of these cases extensions of detention were granted. These powers represent a vital weapon for the Royal Ulster Constabulary in their continuing struggle against the forces of violence. We have consulted the police not only in Northern Ireland, but also in England and Wales and in Scotland. They are united in their conviction that it is essential that these powers remain available to them. They are determined to win
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the battle against terrorism and the Government are equally determined to do all we can to support them.
The draft order that is before the House seeks to continue the Act for 12 months in its present form. It would be possible to continue only selected provisions of the Act and to allow the remainder to lapse. Last year we debated specific proposals that separate orders should be made in respect of different portions of the Act in order to concentrate attention on whether there genuinely was a continuing need for each of the various powers. I do not believe the time is yet ripe for any such piecemeal approach to this legislation. It is, as I have said, not yet a year since we completed our consideration of what was then the Prevention of Terrorism Bill. We debated it most fully and most carefully, word by word, line by line. Since then, at Brighton and in St. James's Square, we have been horribly reminded that the threat of terrorism has in no way abated. We have a package of powers that Sir Cyril's report shows are being used sensibly and with restraint when they are necessary. The changes that were introduced last year have, as I have shown, proved themselves successful. In the light of all those factors, it would be most unwise at this stage to contemplate change.
We do not ask lightly for your Lordships' approval of this draft order. It has not been introduced without real thought and genuine consideration of the continuing need for these wholly exceptional powers. The Government are convinced that they are indeed necessary, but they are convinced also that they should remain in force for not a moment longer than they continue to be necessary. On that basis I ask your Lordships to agree to the order which has been laid before you. My Lords, I beg to move.
Moved, That the draft order laid before the House on 12th February be approved.—(Lord Elton.)
6.41 p.m.
Lord Mishcon: My Lords, as the noble Lord the Minister has said, the provisions of this Act were carefully debated in your Lordships' House last year. We realised then, as we realise now, that there are possibly three fundamental principles which we have to consider, and we have to see where the balance of advantage lies in regard to those principles.
The first principle is the need to contain and, if possible, to remove from our land what is perhaps one of the greatest scourges of our time: that of terrorism. The noble Lord is quite right when he reminds us of the black days which are written in our contemporary history: Harrods, Hyde Park, St. James's Square and the death of the gallant policewoman, the Libyan killings, and Brighton.
The second fundamental principle is to maintain what is possibly the greatest jewel, and the most precious one, in our national crown: that is the freedom of the subject and all our law which goes to defend it. I could not put it better than did the noble Lord the Minister on the Second Reading of what was then the Bill, on 6th February 1984, at col. 885. He said—and how I agree with him, as do all my noble friends:
"There is something repugnant to the British spirit in the limitations to the rights and freedoms of individual citizens which such legislation as we now contemplate necessarily provides. It is for

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that reason that Parliament doles out these necessary powers so reluctantly and for such short periods of time. The Home Secretary, upon whom responsibility for internal security rests, is not given these powers indefinitely, or for the duration of a particular state of affairs, or even for the life of a Parliament. Year by year the Home Secretary, and his predecessors, have had to come to the House of Commons and justify their continuance—just as I, and my predecessors, have had to come to this House to convince your Lordships that they were still necessary.".
I end the quotation there, and I repeat: it is a principle; they are words with which all my noble friends, so far as I know, profoundly agree.
There is a third principle, which is the need to maintain public confidence and public co-operation in such provisions as are laid down in this Act; the need to see that that co-operation is not removed from citizens who feel that powers are being wrongly used or that wrong powers are being given. And, if I may say so, that particularly affects Irish citizens—honourable Irish citizens—both in Northern Ireland and in this country. It is a difficult matter, when you consider those three principles, to weigh the balance; so difficult indeed that I suppose it splits the views of people in various political parties. Parliament, in its wisdom tried to emphasise the need for such care before renewal approval was given to the provision of this Act when, in a Standing Committee in another place, and on a free vote, it was decided to put into the Short Title of this Bill the words "Temporary Provisions".
Another question arose when the Bill (now the Act) was discussed in your Lordships' House and the noble Lord the Minister fairly referred to these matters. Your Lordships may remember that the noble Lord, Lord Henderson, and, I believe I am right in saying, the noble Lord, Lord Wigoder, and others on all sides of the House, wondered whether, when we came to review the provisions of the Act and sought to see whether there should be an order to renew, there should not be separate consideration of the various parts of the legislation. I remember, as will your Lordships, too, the noble Lord, Lord Henderson, moving with some eloquence, as we would expect of him, an amendment which dealt with the separate consideration by your Lordships of parts of the legislation when the review took place. On all sides of the House—and particularly, if I may say so, on this side of the House—concern was expressed on the need for review, and it is good to see that tonight we are actually participating in such review.
However, I have to remind your Lordships of a particular point, if I may. I do so without any discourtesy at all to the noble Lord the Minister, and later I shall be saying a personal word regarding my continued respect for him—a respect that all of your Lordships have. The amendment of the noble Lord, Lord Henderson, was withdrawn upon a series of undertakings being given (as reported at col. 415 of the Hansard of your Lordships' proceedings) on the 8th March 1984, at the Report stage of the Bill. I shall be forgiven—because it is so important—if I quote the undertakings that were given. The noble Lord, Lord Elton, said this:
"Your Lordships have undertakings that, except under circumstances that make it impossible, your Lordships will have an ample opportunity to debate the Act. Your Lordships have an undertaking that the Secretary of State will consider with great care which points from such a debate might be included in a revised order. Your Lordships have an undertaking that the debate will be
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conducted in the light of the report of the person we shall proceed to appoint following our debate on Amendments Nos. 10 and 11".
The noble Lord the Minister then went on to refer to the noble Lord, Lord Henderson:
"The noble Lord was kind enough to say what I had intended to point out to your Lordships, that that cast a different light on the need for supervision in the way that is now proposed. I hope that your Lordships, with those three substantial undertakings, will feel that you have done your job as constitutional watchdogs for the liberties of the private citizen, and will be content without this further device".
The noble Lord, Lord Henderson, said at col. 416—and I quote his remarks—
"the noble Minister's undertaking in Committee has been reinforced again just now by an undertaking he has given on behalf of the Secretary of State. For these three reasons I should be prepared to withdraw the amendment, though not for the real technical objections. I do not regard them as having any validity at all."
Fairly was it said by the noble Lord the Minister that a report of how this was working out, upon which the whole of this debate was meant to take place, was put in the Library 48 hours ago; namely on Tuesday. The letter from Sir Cyril Philips dated 15th February, which accompanies the report states,
"As you suggested it takes the form of a personal enquiry"—
this is of course addressed to the Secretary of State for the Home Department—
"intended to assist Parliament when considering any order laid before them by the Government for the continuation of the Act".
Is it really good enough, when everybody is saying that this review must take place with the greatest care and with all the information before the House, and in the light of a report to be made, that that report is available to the membership of your Lordships' House only 48 hours before the debate takes place?
I wish that my complaint ended there, but it does not. This debate upon the provisions of the Act, and the question of its renewal, is taking place when, so far as I know, I may be the only person who happens to have the Tenth Report of the Standing Advisory Commission on Human Rights for 1983–84. I do not know whether anybody else has that privilege. That is a commission described by the Secretary of State in the following terms, which are quoted in the report:
"I greatly value the independent role of the Standing Advisory Commission on Human Rights and shall continue to look to it for advice on human rights matters generally, while taking account of the responsibilities of other statutory bodies".
This report was available for the first time at three o'clock this afternoon. It has in it matters affecting the provisions of this Act, its renewal and advice and recommendations in regard to it, to which I shall refer your Lordships later. There is no opportunity at all for your Lordships to consider this important report of the commission on the working of this Act, on the question of renewal and on what ought, or ought not, to be renewed. As I said, I shall be referring to those matters hereafter.
But my first and almost poignant observation is this. It is not the way in which your Lordships' House ought to be treated, especially when—and I say this without any disrespect personally to the Minister who, I am sure, is not responsible for the delays—there have been undertakings to your Lordships' House about the possibilities of this debate affecting the mind of the Secretary of State in deciding what ought to be done in

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regard to the renewal of the final order, and when we were told that we would have one month between a debate taking place in your Lordships' House and in another place and the laying of the final order.
So I start with that observation and say that it is not easy to know whether one ought, in those circumstances, to oppose or approve the order on the basis which I have just mentioned. But I know that your Lordships will expect me, at all events, to deal with some of the specific points which I think ought to be borne in mind by the Secretary of State.
The first point to which I come is exclusion orders. The House will remember the concentrated debate that took place upon a provision so alien to our laws, our customs and our traditions, that people should be excluded from parts of the United Kingdom and also excluded specifically by another section of the Act from Northern Ireland. We insisted upon certain safeguards. We did not like the provision, but in the end it was maintained in the Bill with certain safeguards that were inserted in regard to it.
What are the figures? The noble Lord the Minister referred to them very briefly, but may I remind you Lordships of what was said in the report of Sir Cyril Philips? In paragraph 38 of his report he drew attention to the fact that,
"During 1984 three exclusion orders were made, two being in respect of persons not detained under the Act. This is a small number by comparison with recent years. There were, for instance, 15 in each of 1982 and 1983".
That is an indication, one might think, of whether we really need to renew provisions relating, for example to exclusion orders.
If I merely had to leave it at that, it would be a matter for your Lordships to consider and to consider, without a recommendation from anyone, whether exclusion orders should no longer be renewed and the power to issue them should no longer be renewed. But this is the relevance of my having referred to the report of the commission which was available only at three o'clock this afternoon, while we are debating this very serious matter at around seven o'clock this evening, because this is what the commission says in paragraph 40 on page 15:
"We acknowledge that implementation of the Jellicoe recommendations has considerably limited the power to exclude persons from Great Britain to Northern Ireland and vice versa, but we remain unconvinced of the need for its retention. Since the passing of the Act, only three persons have been excluded from Great Britain to Northern Ireland, and one from Northern Ireland to Great Britain. Even in its limited form this power is, we believe, contrary to the spirit of Article 8 of the European Convention on Human Rights and to Article 12(1) (right to liberty of movement and to choose one's residence) of the United Nations Covenant on Civil and Political Rights. Last August the Government announced that it has withdrawn its notices of derogations from both the Convention and Covenant and we hope that in this context it will now be possible to allow these extraordinary powers to lapse".
I suspect that the Minister himself did not know before he walked into the Chamber, or certainly at some hour this afternoon, of the existence of this important report and this recommendation. Knowing him as I do, I am sure that if he had been aware of it he would have said, when referring to the exclusion orders and the ways of renewing them, that there was a report of a commission of the importance of the Standing Advisory Commission of Human Rights
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which had recommended to a senior Minister of the Crown that these exclusion orders should no longer be retained.
There are other recommendations made by the Standing Advisory Commission on Human Rights, but because of the lateness of the hour, the desire of other noble Lords to speak and the length of the agenda, if I may so term it, of your Lordships' House today, I shall be very brief about them. There is the whole question, for example, of Section 11. Again, your Lordships were very doubtful about Section 11. Perhaps I may remind your Lordships that this is the provision which makes it a criminal offence not to pass on to the authorities information which you happen to have which may relate to terrorist activities. We were all doubtful about that. We allowed it to go through. I was looking—I am sure your Lordships were—for something in the report of Sir Cyril Philips about how many prosecutions had been brought and whether it was necessary really to keep Section 11. I cannot see anything on that in the Philips Report. The noble Lord the Minister did not tell us how many prosecutions there had been, or what use there was in Section 11, so again I say to the House from these Benches: is there really a need to keep the powers under Section 11?
In the report of the Standing Advisory Commission on Human Rights, to which I have referred so many times—it is almost a mockery that I refer to it when your Lordships have had no opportunity to see this important document but are asked to come to some important decision tonight—there is also a firm recommendation that there should be integral legislation relating to Northern Ireland, because at the present moment there is this Act, there are the Emergency Powers Regulations and there is the Police and Criminal Evidence Act. It means there is a complete difference between the provisions that apply to England, Scotland and Wales and those which apply to Northern Ireland, and the law in regard to Northern Ireland is in such a jumble by virtue of the situation to which I have just referred.
I could go on with other matters relating to this order, but I feel that your Lordships have been patient enough and that all sides of the House will share our disappointment at the lack of time and opportunity that we have been given properly to consider whether all or part of this order should in fact go forward. It is with some dismay that I say this, having regard to the solemn undertakings that were given to this House.
7.3 p.m.
Lord Wigoder: My Lords, I am grateful to the noble Lord the Minister for his explanation of, and his comments on, this order, and also, indeed, for his assistance in trying to help those of us who were interested in the order to receive at the earliest possible moment the report by Sir Cyril Philips and the riposte by the Secretary of State.
The object of our proceedings this evening has been made clear particularly by the noble Lord, Lord Mishcon. It really arises as a consequence of the amendments that were moved by the noble Lord, Lord Henderson, and myself, when the Bill was being considered in this House, in which we endeavoured to ensure that the different parts of the Bill, or the Act as

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it now is, might be considered separately and renewed, if necessary, or not renewed, instead of us having to take the Act as a whole and renew it en bloc as a result of our not being able to amend the order. The Government proposed as an alternative the somewhat cumbersome procedure upon which we are now embarked, under which we apparently have a debate on the renewal order about a month before the Act is in fact due to be renewed, and the Government will then consider whether sufficiently strong representations have been made today to warrant their changing the order and reintroducing it during the next month.
That, as I understand it, is the object of the debate this evening, and I propose to confine myself entirely to that and not to embark on a consideration of any of the wider issues. We have been much helped, of course, by the report of Sir Cyril Philips, who has monitored the working of this Act. I am happy to say that that arises in the first place as a result of proposals made on the Liberal Benches in another place. I note that this Act became law on 22nd March 1984. The undertaking was given by the noble Lord the Minister before that date that there would be a monitor. So far as I can see from the report of Sir Cyril, he was not in fact appointed until December, some eight or nine months later. If that is so, perhaps that explains why, as the noble Lord, Lord Mishcon, has pointed out, we have had had this report for only a matter of 48 hours. After all, Sir Cyril has been working on the matter for only some five or six weeks, and he has really done rather well perhaps to get a report ready at all in that time.
I do not particularly complain about the 48 hours. It is a short report, and I found it perfectly possible to digest it in that period. However, I cannot help wondering why there was the delay in asking Sir Cyril to take up the position in the first place, and whether the intention was not always that the monitor should be there 12 months of the year supervising the way in which the Act was working.
I come, then, to the main areas of concern in the Act in order to try to see whether there is any real case for seeking to persuade the Government that certain parts of the Act ought not to be renewed at this stage by order. I begin with a matter that has concerned us all—the provisions for detention and particularly for extended detention up to a period of seven days. I note, if I have understood Sir Cyril's figures correctly, that of those who were subject to extended detention during the year, seven of them were charged, one of them with a very serious offence. I note, on the other hand, that of those subject to extended detention, some 19 were not charged at all and in due course were set free.
I do not know—and I have made this point before, in other debates on this subject—how one draws an arithmetical balance. I accept, of course, that there must have been the gravest hardship, the gravest inconvenience and in many cases the gravest wrong to those 19 who were detained and then not charged. On the other hand, I cannot help but reflect on the number of lives that might well have been saved as a result of the fact that seven people were in due course charged because of the provisions for extended detention. In those circumstances, my own feeling at the moment is that, on the whole, the balance is in favour of leaving
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the provisions for extended detention in the Act for another year.
I note that in paragraph 20 of Sir Cyril's report he comments that there have been cases—"instructive instances"—in which the Secretary of State declined to grant applications for extended detention. I should be grateful if the noble Lord the Minister could assist us in due course as to the number of such cases in which there have been refusals by the Secretary of State.
The second main area about which many of us had and still have doubts concerns the exclusion provisions. One cannot help but notice—it is a very remarkable figure—that during the year only three exclusion orders have been made. I think the time may very well come within the next year or two when there will be agitation in your Lordships' House to remove that power from the Act when this order is continued. I venture to think that it might be perhaps a little premature at this stage, in the first 12 months of the Act's working. So far as I am concerned, I would not at this stage want to support any such course.
The third matter of importance is the extension of the principles involved in this Act to international terrorism. I certainly would not disagree, and did not disagree, with those proposals then. I note that some 44 people have been detained on suspicion of acts of international terrorism. Eight of those were in due course charged, and apparently 13 were deported back to their own countries. If it is not confidential information, it might be interesting if the noble Lord could tell us to which countries those 13 people were in due course returned.
The final matter in the Act which aroused much comment at the time was the provision in Section 11 making it a criminal offence not to disclose information, and about which the noble Lord, Lord Mishcon, has already commented. I assume from the fact that Sir Cyril does not mention this matter that there have been no such cases during the year. In fact, I believe there have been no such cases most years since 1976. There has only ever been the very occasional instance, usually involving a number of defendants in the one case. That strengthens the argument again that that section of the Act is unnecessary. But as we passed this Act only 11 months ago, perhaps it is a matter upon which we ought to reserve judgment at this stage.
When I consider the Secretary of State's response, there is only one matter about which I would ask the noble Lord, Lord Elton, to provide help; that is, where he deals with the subject of tape recording, Sir Cyril suggested it was important that interviews with suspects under this Act should if possible be tape recorded. The Secretary of State says that some aspects of the kind of cases dealt with under the Prevention of Terrorism Act raise particular difficulties in this context. I am not quite sure what is meant by those words. It might be possible for the noble Lord, Lord Elton, to elaborate upon them when he replies.
One's overall view of this order and of the progress made over the past 11 months is this: first, we passed a new Act of Parliament only 11 months ago after—as has been said by the noble Lord, Lord Elton—very careful discussion and debate in your Lordships' House. In principle, it would be wrong—unless a very

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strong case was made out of the evidence—to make alterations to a new and carefully considered piece of legislation so quickly.
My second conclusion is that the legislation is effective at the moment. I do not mean effective in the sense that it will ever provide a long-tem solution to the dreadful problems of Northern Ireland; however, it appears to be having an appreciable effect in our fight against dangerous, desperate and evil men. In those circumstances, there seems to me to be no sufficient evidence at this stage to warrant asking the Government to take this order away and to amend it, so that particular sections may be omitted from the renewal process. On this first occasion, I am certainly prepared not to oppose the renewal of this order.
7.13 p.m.
Lord Boyd-Carpenter: My Lords, I find myself very much in agreement with the noble Lord, Lord Wigoder, in his concluding words. Whatever doubts or anxieties any of your Lordships may have as to particular provisions of the Act, it is a very new Act, to which this House directed close and detailed attention not very long ago. It has not been operating very long, and the independent report upon it by Sir Cyril Philips certainly does not appear to me to reveal any serious or severe failures in it. Therefore, whatever your Lordships or the Government may decide to do in future years, it would seem that, on this occasion, to seek to dismember the Act to some extent would be at the very least premature. I therefore find myself wholly with the noble Lord, Lord Wigoder, on that point.
The noble Lord, Lord Mishcon, is perhaps the most skilled debater in this House; and the skill with which he fastens on any weak point in his opponent's case was demonstrated right at the beginning of his speech when he took the wholly reasonable point—with which I have complete sympathy—that it is a pity that we should have received Sir Cyril Philips' report only 48 hours before discussing this order. However, as the noble Lord said, it is not a very difficult document. Most of us with any experience of digesting documents would not have taken long to digest it. But it is true that many noble Lords have other preoccupations and commitments, and so I would say to my noble friend that it seems to me somewhat inconvenient that this document could not be made available somewhat earlier. On that limited point, I found myself not in disagreement with the noble Lord, Lord Mishcon.
I would quarrel with the noble Lord, Lord Mishcon, when he spends a great deal of time, and lays much emphasis, on the report of the Standing Commission on Human Rights. I am not very sure how much experience the distinguished personages who serve on that commission have of the problems of dealing with terrorism. I rather suspect that they are, from that point of view, inhabitants of an ivory tower. The brutal realities of terrorism—Irish and international—with which we have to cope today are a new factor of recent years in the whole situation of the Western World. It is not possible to adhere to some of the old high principles of the past in the face of the kind of attacks to which we are subjected at the moment.
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The noble Lord will recall the old tag, inter arma silent leges—and it must be the case that the highest and most liberal of principles need to be examined very critically, and perhaps their operation suspended, when society is faced with the kind of situation with which our society has been faced. We seek to renew this order at the end of a most ghastly year. I will not describe the many incidents because other noble Lords have already done so. But within a matter of months of the attempt to destroy the British Government at Brighton—a brutal, calculated attempt (as the noble Lord opposite said) to destroy democratic government—is it not inconceivable that your Lordships should decide to abandon any of the limited restrictions on normal liberties involved in the order?
It is utterly unrealistic to believe that we can cope with that kind of subtle onslaught under the normal principles of English law by which we are bound. It is necessary to take some exceptional powers. But in looking at these powers, my noble friend, Lord Elton, might well say, with Warren Hastings, "I am astonied at my own moderation". There are very few countries in the world who, faced with a similar situation, would be so moderate or restrained. Can noble Lords envisage what would happen in the Soviet Union if an attempt had been made to assassinate the Presidium and if bomb attacks had been made on every outside activity thought to be vulnerable? There would not be very much careful weighing of the extent to which liberties might have to be suspended. There would have been action far more downright than this.
I am not suggesting that we should in this respect, or in any other, seek to emulate the Soviet Union—but it is significant that we in this country, faced with such a situation, should still be worrying ourselves quite a bit about such moderate and modest restrictions. Let us take the exclusion orders. Great play was made by the noble Lord, Lord Mishcon, of the fact that only three have been made under the Act. Whatever else that shows, it certainly would seem to show that the power to make those orders had not been abused. It has been exercised with great moderation. However, that is not necessarily an argument for giving away the power. It may indeed have some deterrent effect. It is certainly causing—if any hardship or unfairness—only hardship and unfairness on a minimal scale. In so far as it has been so moderately used, that would appear to be an argument equally susceptible to the view that it had been exercised with the kind of moderation that one would expect of our authorities in this country.
We are faced with an order for renewal of the whole of the temporary provisions of this measure. It seems difficult to see how, faced by the situation with which we are faced—by the horrors that have been and the horrors that may well be to come—any responsible legislature could do other than say at least for another year that it must be continued and continued in full.
7.21 p.m.
Lord Monkswell: My Lords, I have read with interest the debates that your Lordships had in this Chamber on the subject of the Bill, as it was then, during its passage through the House last year. I have also read—admittedly only in the past hour or so—the report by Sir Cyril. I have not as yet, because I heard about it only a few moments ago, had the ability to

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read the report of the Standing Commission on Human Rights in Northern Ireland. If I take, as I do, the quotes which the noble Lord, Lord Mishcon, gave in regard to that report, I find it very disturbing that we do not have it in front of us today, or—should I say?—that we have not had it made available to us in due time to consider it with our deliberations today.
I must also bring to my deliberations on this subject my experience of the world about us. As your Lordships may be aware, outside this hallowed Chamber I am an ordinary citizen. I have an ordinary job. I mix with, one might say, normal people. I have none of the trappings of wealth or pomp and circumstance to set me apart from the community. I am glad. I meet and converse with a wide variety of people—English people, of course, and Scots, Welsh and Irish; Conservatives, Socialists and Liberals; authoritarians and civil libertarians.
I must advise your Lordships at this stage that from what I have read and heard from my community, I believe the Prevention of Terrorism (Temporary Provisions) Act 1984 to be a bad Act. I shall do everything in my power to oppose its continuance. I shall address myself to a few specific features of the Act and try to explain why I seek your Lordships' support in opposing it. It allows for the penalty of banishment without benefit of judicial procedure or right of appeal. It allows for detention without trial, or even charge, for seven days. It is discriminatory against Irish people, and I believe that it fosters terrorism.
Many centuries ago the barons of this land—one might say the natural antecedents—met at Runnymede, just a few miles up the river from here, and curtailed the absolute powers of the executive of that time. I believe that it would be a good thing if we did something similar today.
Such powers as imprisonment without trial and banishment were used by Germany, Italy and Spain during their Fascist periods in this century. But I suspect—and I am no legal authority; I am an engineer by profession—that even they were subject to judicial review, even though their judiciary may have been very much emasculated during those periods. Here I must remind your Lordships that the fight against Fascism did not begin in 1939 but started in the early 1930s; and that from 1945 until the death of Franco we had a Fascist regime in Spain, and a brief but devastating resurgence of Fascism in Greece during the period of the Colonels' Junta. I have a great aunt who was a citizen of Italy, who can testify about living as an exile from her country during the period of Fascism in Italy. It is interesting that her most prized possession of that period was a box which contained the wherewithal to make forged papers.
I hope that I shall not be misconstrued in my statements just now. I do not argue that we have descended to a Fascist regime in this country, but we must be aware that such powers as are contained in the Act in front of us take us part way down the very slippery slope towards such a state. We must be aware of perceptions as well as realities. That this Act is discriminatory against Irish people is a reality.
I am grateful to the noble and learned Lord, Lord Denning, for this contribution during the Committee stage of the Bill last year. At col. 892 of Hansard of
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23rd February 1984, he quoted the case of the Nazi parson liable to internment under regulation 18B in force during the great patriotic war. That was Hitler's war. With your Lordships' leave, I shall quote the noble and learned Lord:
"but we did put the case to him so that he could answer, put his views forward and we could understand and go through it. But we did put the case to him and we acted as much judicially as we possibly could, consistently with the security of the state".
I refer also, as reported further down the column, to the case of Mark Hosenball, when he was subject to deportation on the request of the CIA. The noble and learned Lord said:
"It is quite true that there was an inquiry, I think it was a tribunal".
That was how an Englishman and an American were treated, and yet 275 Irish people have been banished without any form of justification being offered or without having any judicial inquiry into their specific case.
While on the subject of advice from our noble and learned colleagues, I wonder whether I may raise two questions. I do not know whether it will be possible for the noble Lord, Lord Elton, or some other noble Lord in our Chamber, to answer these questions, but I pose them in the hope that answers may be forthcoming. Apart from the powers of the Secretary of State to deport aliens and those powers contained in the immigration Acts, when did banishment by the executive last occur? I suspect it was probably before the Middle Ages. Also when did banishment by due process of law last occur? I suspect that that was probably in the last century when deportation to Australia was still part of the criminal statutes. However, it might be interesting to have answers to those questions.
My final and most compelling reason for opposing this order tonight is that the Act is counter-productive. In some circles it is even hailed as the, "Promotion of Terrorism Act". May we consider for a moment the effect of the worst provisions of this Act? As has been quoted before, 275 people have been banished under either the terms of this Act or alternatively those of the predecessor Acts. Here I must make the point that we are not just discussing an Act that was passed in isolation last year.
Lord Elton: My Lords, would the noble Lord be good enough to give way?
Lord Monkswell: My Lords, may I just finish this point? We are talking about legislation which has been on the statute book continuously since 1974, under the heading of "Temporary Provisions".
Lord Elton: My Lords, if the noble Lord has finished with, what he is pleased to term "banishment", there is no point in this intervention. If he proposes to go on, I should like to point out that banishment is being sent away from your home and that is prevented from happening under the Act.
Lord Monkswell: My Lords, I am grateful for the intervention of the noble Lord, Lord Elton. However, I find this very curious. I am trying to understand how,

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if someone is excluded from the United Kingdom, that is not banishment from his home. Can people take their homes with them somehow?
Lord Elton: My Lords, I probably should not keep intervening. However, if the noble Lord reads the Act he will find that it applies to different parts of the United Kingdom and cannot be applied to the part in which a person lives.
Lord Monkswell: My Lords, I have read the Act. So far as I can gather, my understanding is that an exclusion order can be served on someone who, for example, lives in Birmingham, to make him go to Northern Ireland. Am I wrong?
Lord Elton: My Lords, that is wrong, yes.
Lord Monkswell: My Lords, then I am thankful for that intervention. I must admit I appear to be labouring under a misapprehension. The powers under these Acts appear not to apply to the Secretary of the State forcing someone to live where he does not wish to live. Is that the correct interpretation of the Act?
Lord Elton: My Lords, I do not think the rules of procedure allow me to conduct a sort of Committee stage exchange with the noble Lord. The facts are as I have given them. If I have anything to add, I will add it in my reply to this debate.
Lord Monkswell: My Lords, I am grateful to the noble Lord. I must admit that I appear to be labouring under a misapprehension. I apologise to the House if that is the case.
As I was saying, 275 people have been subject to detention without charge and trial and subject to exclusion orders. If we can make the assumption that each of those people will have on average two children, we are dealing with a situation where 550 children are affected. If the person subject to these powers is innocent of any involvement in terrorism, then I submit that he will be very aggrieved by these procedures and I should not blame them for beginning to listen to the propaganda promoted by the terrorists. If, on the other hand, he is inclined to terrorism, I suggest that being subject to these kinds of power would only reinforce his attitude to the British Government.
I have three small children. I do not want them, in 15 or 20 years' time, to be subjected to the kind of terrorism with which we are faced today on the basis that we have apparently caused injustice to people in the Irish community. I think we have a duty to people outside this House who seek to support human rights and the Prevention of Terrorism Act, to do what we can to demonstrate our belief in those principles and to argue it for them in this House, but, at the same time as arguing for them, to demonstrate our support by, if you like, going through the Lobbies. That is one of the reasons why I should have sought to divide the House this afternoon.
The noble Lord, Lord Mishcon, has introduced the fact that the report of the Standing Committee on Human Rights in Northern Ireland has not been
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available in time for this House to take it into consideration in its deliberations on this order in front of us tonight. In view of that, I trust that the Government will not push this order to a Division tonight, in the hope that, following the full availability of the necessary papers, a better consideration of the order can be given by your Lordships.
7.37 p.m.
Lord Nugent of Guildford: My Lords, my intervention will be very brief. I confess that I was drawn into taking part in the debate mainly because of my anxiety on the score of the official attitude of the Labour Opposition. That is not to say that I have any quarrel with the speech made by the noble Lord, Lord Mishcon, which, as my noble friend Lord Boyd-Carpenter has already said, was delivered with his customary skill and moderation.
Lord Boyd-Carpenter: Skill, anyhow.
Lord Nugent of Guildford: However, as the noble Lord well knows, in the other place the official Labour Opposition has stated that it intends to divide against the order. I feel that that is a most unfortunate thing to be happening on a measure of this kind, where, as the noble Lord, Lord Mishcon and others, have rightly said, we have to try to hold a delicate balance—and the noble Lord, Lord Mishcon, put it quite eloquently—between the liberty of the subject and the safety of life and limb of the community. In the event, he made a cogent point that we did not have the report of the human rights comission. That is a fair point. It would have been desirable. As my noble friend Lord Elton his already been told, it would also have been desirable if we had had the report of Sir Cyril a little earlier. However, it is a pretty simple report and even I could take it in in 48 hours.
I feel concerned that there should be this division between parties on something which I feel goes right to the heart of the safety of the whole community—both the safety and liberty of the subject and the safety of life and limb.
I would say this to the noble Lord, Lord Monkswell. The noble Lord has made a speech. He obviously feels very deeply about this and he has even had the benefit of a short seminar from my noble friend on the Front Bench about what the law is on the matter, from which I hope he will have benefited. However, his final comment was that he had three children who he was worried about preserving from the injustices this order might contain. The Government have a responsibility to be concerned about preserving those three children and the noble Lord, Lord Monkswell, from being destroyed altogether by one of these bombs. That is the reality that we live with today.
It is not of course just the bombings by Irish bombers. Unhappily today, as we see by the Libyan example, terrorism works on an international scale. Certain religious sects think nothing of suicide if they can achieve their end by destroying something that is a symbol of the society or of a nation they do not like. Goodness knows! we have seen this on an appalling scale in Lebanon over recent years. It occurs in other countries in the Middle East. And some of these

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people come here. We really have to defend the community against such things. As my noble friend rightly said, not only do we want to defend ourselves but also we do not want our country to become a battleground for others to come and fight out their quarrels.
These powers are directed to a very practical necessity. That is really the only point that I wish to make. Other noble Lords, especially the noble Lord, Lord Wigoder, have dealt ably and fairly with the issues mentioned in the admirable report by Sir Cyril. I should like to thank him. I have found the report most helpful. It gives us a clear picture of what is happening. As years go by, we shall get an even clearer picture. It is however fair to say that, at the end of it, we would feel justified—I certainly would—in supporting my noble friend and enabling him to get his order and to proceed with it for another year.
Exclusion is of course a desperately serious punishment to inflict on anyone. I agree with my noble friend, Lord Boyd-Carpenter, in saying thank goodness that there were only three. That is much to be welcomed. It is evidence of moderation as well as evidence of the fact that the day may perhaps come when we can get rid of this power altogether. All of us would be very glad. However, we certainly want at least another year before we consider shedding that powerful additional safeguard.
With those few remarks, I support my noble friend and express the most sincere wish that noble Lords opposite, with their wisdom and moderation, may be able to influence their right honourable and honourable friends in another place so that, for another year, we might collectively, on all sides, be able to support the measure and show that it has the support of the whole community.
7.43 p.m.
Lord Hylton: My Lords, in previous years, in common with other noble Lords, I have expressed concern about the impact of this Act on community relations. I hoped that this would have been a matter to which Sir Cyril Philips gave some attention. I hoped that he would consult not only organisations connected with community relations in Northern Ireland and the Irish associations in England but also organisations connected with refugees and with Commonwealth citizens. It is not clear from his introductory letter or from paragraph 2 of his Report that he has extended his consultations beyond what he calls officials and the police. However, that is not the main issue that I wish to examine.
I should like to turn to the relative inefficiency of the Act in so far as it concerns Britain. The noble Lord, Lord Mishcon, listed the major explosions that we have experienced in recent years. I can claim, I think, to have suffered from the Hyde Park and Regent's Park bombs in that they torpedoed a modest amendment that I was attempting to move in your Lordships' House that very afternoon. None of these explosions was prevented by the mere existence of the Act.
The Act, of its nature, must be something of a broad and blunt instrument. If the noble Lord, Lord Elton, can say in his reply that it is now being used with the
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precision of a stiletto, that will be extremely welcome. The fact, however, remains that no fewer than 5,905 people have been formally detained since 1974 under the Act and its predecessors. That is an average of about 600 people a year. But 87 per cent. of those people were subsequently released without charge. Only 5·6 per cent. of those detained were convicted of any offence after detention, and a mere 2·25 per cent. received a custodial sentence of more than one year. I am well aware that crude percentages of this kind are not entirely conclusive. Nevertheless, I feel that they are indicative.
I come to the question of port powers. One can well understand that the duties of police officers and customs and immigration personnel at the ports must, of their nature, be boring and difficult to interpret in a humane way. Nevertheless, I see a danger that people passing through the ports—shall we say?—dressed in jeans and with long hair, are the ones who are detained. They appear to conform to the stereotype of the revolutionary, while the bomber who is disguised in a three piece suit and is perhaps equipped with a rolled umbrella and briefcase, may so easily slip through. I should like to question just how effective these port powers are, given that there is, first, a very nearly open and very long border between the Republic of Ireland and Northern Ireland, and secondly, that there is somewhat open access to all the British coasts by fishing boats, yachts and other pleasure vessels not to speak of the possibilities of light aircraft making landings rather further inland.
Finally, I should like to re-emphasise a point made by the noble Lord, Lord Mishcon, and ask the Government whether they will consider and act on chapter 4 of the tenth report of the Standing Advisory Commission on Human Rights which was only published this morning. In particular, will they look most carefully at paragraph 40 concerning exclusion powers? Will these powers be allowed to lapse following the withdrawal of the previous derogation from the European Convention on Human Rights that took place last August? I have given notice to the noble Lord, Lord Elton, of the points that I have so far made. I should like to add another and to apologise to the noble Lord for not giving him notice of it. I refer to the impact of this Act and of the Police and Criminal Evidence Act on training of police forces. Will he ensure that adequate instruction is given so that powers are not exceeded and so that innocent persons whenever possible are not arrested or detained?
7.48 p.m.
Lord Harris of Greenwich: My Lords, I will begin by making a few comments on the last two speeches. The noble Lord, Lord Hylton, asked, at the beginning of his speech, why Sir Cyril Philips had not consulted a number of people before submitting his report to the Home Secretary. That may be a reasonable point—but of course subject to one rather important qualification. That is, as my noble friend Lord Wigoder pointed out, that Sir Cyril Philips was appointed in only December of last year. He has had six or seven weeks in which to write this report. In my view, he has done a notably successful job in producing such a high quality report in so limited a

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period of time. I hope very much that the noble Lord, Lord Elton, will be able to say why Sir Cyril was not appointed until December.
As to the speech of the noble Lord, Lord Nugent, with which I very much agreed, the noble Lord called for a spirit of bipartisanship on this measure. I very much agree. It is a great pity that in the House of Commons this has become a party issue. The Act was brought in by a Labour Government. And so was the exclusion power. This is a point which we should always keep at the forefront of our minds when discussing this question.
It is important to come now to what the noble Lord, Lord Monkswell, said in his interesting speech. I fear that I am not able to agree with the general thrust of his argument. It was introduced because of the very substantial loss of life that took place in the public-house bombings in Birmingham. The Home Secretary met his advisers the following Sunday. He produced the draft Bill to the Cabinet on Monday morning and it was put through Parliament in that week, going through all its stages in this House on the Thursday. On the Friday morning the powers were brought into operation at all ports and airports in this country. I think that says something for the spirit of bipartisanship we had at that time. I repeat that I hope very much we will stop this process of dividing the country along party lines on matters of this kind, which are so central to the security of every man, woman and child living in Britain.
The only other points I should like to make refer to the report of the Standing Commission on Human Rights in Northern Ireland. Unfortunately, I have not had an opportunity to study this report, but certainly I shall do so. Whatever it may have said on the exclusion order power, I think it is only right to remember that these matters have been investigated with great thoroughness, first by the noble Lord, Lord Shackleton, and then by the noble Earl, Lord Jellicoe, who went into this matter in infinitely more detail than the Standing Commission on Human Rights in Northern Ireland could possibly have done. If I may say so, on this point I agree with the general approach of the noble Lord, Lord Boyd-Carpenter.
I think it is quite clear that, without the powers which are contained in this Act, we would have to face the situation that a number of people who are now alive would be dead; it is as simple as that. I can speak as a Home Office Minister to whom these matters were referred when the 1974 Act first went on the statute book. I must tell the House quite bluntly that the evidence before us was quite overwhelming: that the people who were excluded were in fact involved in a conspiracy to create explosions, to make attacks in this country and to cause loss of life. The reason we had to use exclusion order powers—we should have preferred to use the criminal law—was that, although the evidence was unmistakable, some of this evidence came from sensitive sources which it would have been quite impossible to produce in an open court.
Even if the court hearings had been in camera, there would have been substantial problems, because there would have been a risk that some of the sources of information would have been revealed; and if those
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sources had been disclosed, those people would have been killed by the IRA. Again, it is as simple as that. That being so, it seems quite clear that these powers are necessary. Speaking for my noble friend Lord Wigoder and myself, and those on these Benches, I can say that if the noble Lord, Lord Monskwell, does divide the House—I hope very much that he does not—we shall certainly go into the Lobby in favour of the order.
Now I should like to come briefly to two other matters which, if I may, I shall describe as concerning non-IRA violence, non-IRA terrorism. First, there is the question of the Libyan students. As one of those who was extremely critical—and, I may say, remains critical—of the way in which we tolerated the establishment of the revolutionary embassy in St. James's Square, I welcome very much the fact that the Act has now been extended to deal with terrorism which has as its basis terrorism outside Northern Ireland. Certainly after the kind of evidence we heard yesterday at Manchester Crown Court about the threat which is represented in this country by Libyans trying to murder opponents of Colonel Gaddafi it seems to me self-evident that powers of the kind we have on the face of this Act are highly necessary.
Lastly, there is a question which I should like to put to the noble Lord. I am not asking him to give an answer tonight, because I have not given him notice, and he may well prefer to deal with it by correspondence. I refer to the general problem of terrorist violence in the European Community. This, as we know, has been growing at an alarming rate during the last 12 months. We have seen for the first time some co-ordination between the terrorist groups operating in France, in Germany, in Belgium and in Italy. As a result of an initiative by the last Labour Government, in 1975 the Government put to the European Council, meeting in Paris, a proposal that there should be regular meetings of European Ministers of the Interior to discuss problems facing police forces and security organisations within the EEC. I assume that these meetings have been continued, at both ministerial and official level, since then.
If I may say so, nothing has been clearer in recent weeks than the scale of the very dangerous threat to which we are now likely to be subjected through the increasing scale of terrorist violence on the mainland of Europe. All I would say to the noble Lord, Lord Elton, is that I hope very much that the initiative launched in December 1975 has been followed up with energy by the Government and that the important consultations between Community partners are continuing.
Having said that, as I have indicated, and as my noble friend Lord Wigoder has indicated, given the fact that this Act was put on the statute book in its present form only last year, in our opinion it would be far too early to consider any substantial amendment to it. Therefore, if by chance there is a Division tonight, we shall vote with the Government.
7.58 p.m.
Lord Fitt: My Lords, it had not been my intention to speak in this debate tonight. It is less than two years since my home was burnt in the city of Belfast, in

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Northern Ireland, and I had to take up residence in this country. With every day that passes I find that I see the troubles in Ireland with a completely new perspective. I never realised the pressures under which I was living in Northern Ireland until I had left. No longer is my home attacked by petrol bombs and by bricks and bottles, and no longer do I live under the threat of the IRA because I was opposed to each and every one of its actions.
As I say, I had not intended to take part in this debate, but I want to put something on record in regard to the introduction of the Prevention of Terrorism Act by the former Home Secretary, Roy Jenkins, in 1974, in the wake of the terrible bombings in Birmingham. It was emergency legislation. I was opposed to emergency legislation because I lived in Northern Ireland under the Special Powers Act. It was there before I was born and it has been there for all the years I have lived. I have never gone into the Lobby in support of emergency legislation, and certainly I shall not be going into the Lobby tonight.
The comments that have been made tonight by my noble friend Lord Monkswell bring me to my feet. His remarks were made with great intensity. He said that this Act seems to discriminate against Irish people. As I stand here tonight, I believe that I am the only Irish-born Member of this House present; I leave myself open to contradiction. There are other Irish people in this House, including two former Prime Ministers of Northern Ireland, and another person who at present represents it. My noble friend Lord Monkswell said that this Act seems to discriminate against Irish people. It does do so, and that is why I opposed it on so many occasions in another part of this building. However, I point out to my noble friend that it was Irish people—and I say this with a sickening feeling in my stomach, and with a great deal of regret—who were responsible for the terrible bombings (and I do not put them in any chronological order) in Birmingham and at Harrods, Chelsea Barracks, the Old Bailey and Hyde Park, for the murder of Airey Neave and for the bombs that were placed in the Tower of London—and even then I have given a very short list. There was the bomb which exploded on the bus just outside Manchester, and which killed a lot of young servicemen and their wives and children. For the incidents which I have not been able to remember tonight I apologise, because all those incidents left behind bereaved fathers and mothers, daughters and sons, wives and children.
The IRA, as was said recently in Belfast, are responsible for this Act being placed on the statute book. Everyone with a television at their disposal will have seen the events that took place over the weekend, and only today. Had I been determined to vote against the continuation of this legislation tonight, as I have done in the Commons over many years, I would have been prevented from doing so by recalling the events of last Sunday outside Armagh Cathedral, when a prison warder was brutally and callously murdered in front of his own two children. Only this afternoon a young policeman was murdered in Killyleagh. This Act is an attempt to isolate the people who are guilty of such terrible murders.
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I recognise that in legislation such as this the innocent will suffer. That is why I have always opposed this type of legislation. My noble friend Lord Mishcon has said that he is opposed to the exclusion orders which are part of this legislation. I have always opposed them as well, because it is my honest belief that people have been excluded from this country who have absolutely no involvement with terrorism. It is also my honest belief—and I hope to have an opportunity to raise it in this House—that people have been sentenced to terms of imprisonment in this country in the wake of the hysterical atmosphere created by a whole set of IRA terrorist circumstances. I express those reservations now.
However, I say to my noble friend Lord Monkswell that it is not easy to envisage all the consequences of this legislation. There are noble Lords on either side of this House who have a conscience about human rights. I refer immediately to the noble Lord, Lord Hylton. He is an Englishman who lives in England. He does not live in Belfast or in any other part of Northern Ireland where one listens to the news every hour and one listens to the sirens of the fire brigades and the bomb disposal squads. I say to my noble friends on this side of the House as well that one has to live in that atmosphere before one can be truly aware of the tragic situation which exists in Northern Ireland.
I can quite understand and fully sympathise with the sentiments expressed by my noble friend Lord Monkswell when he says that he is interested in human rights. I am interested in human rights as well. I do not need to have an NCCL brief sent to me. Some of the people on the National Council of Civil Liberties who draw up briefs to send to Members in the House of Commons and to my noble friends in this House are people who have never set foot in Northern Ireland, who have never heard an explosion or who have never seen the mangled remains of someone who has been killed. I am not going to accept a brief which has been sent to me by some of those organisations.
I refer again to my noble friend Lord Monkswell, who has said that he is interested in human rights. All those people to whom I have referred, including the policeman who was killed this afternoon, also had human rights. The warder who was killed coming from his Holy Mass on Sunday with his two little children also had human rights. All the people who have been murdered had human rights, and to my mind their human rights are far more paramount than the reading of a brief sent to me by someone who has never lived under such circumstances.
As I have said, it was not my intention to speak in this debate tonight. I have always opposed emergency legislation. However, the one thing which will keep me out of the "No" Lobby, irrespective of the sentiments expressed by my noble friend, is the fact that this evening there is an RUC man lying dead for committing no crime other than carrying out his duty. There is a warder who was buried only yesterday for doing exactly the same thing. I detest legislation such as this, but I detest even more the people who make it necessary.
8.7 p.m.
Lord Elton: My Lords, the importance of the subject with which we are dealing, and the deep emotional chord of personal experience which the noble Lord, Lord Fitt, has just struck, would make this a suitable occasion for the measured oratory of a prepared speech in reply. However, my duty is to reply as best I can to the questions and, if I may say so, to the charges which have been raised during the course of this debate, and I shall stitch them together out of the material which I have for that purpose.
I suppose I should begin with the point with which the noble Lord, Lord Mishcon, led after an introduction of great responsibility in which he pointed to the difficulty of balancing one issue against another and the prime concerns which we should have in striking that balance. Within the imcomparably thick velvet of his glove was the noble Lord's mailed fist when he reminded your Lordships of my undertaking to this House less than 12 months ago and suggested that I had in some way—he was kind enough to say it was not at my own choice—failed to honour it in full, or had at least been discourteous to the House. Others of your Lordships have reflected that view.
Let me start by telling your Lordships what it was that Sir Cyril Philips was appointed to do, and why it was intended that he should be appinted not at the beginning of the operation of this Act but late on in its operation, by quoting the exact words which I used in the undertaking that I gave on 8th March last year. I said:
"Without attempting to curtail his role, I shall describe what he would do and how he might do it. First, he would not be an appellate authority. It would not be his task to say that the extension of the detention of Mr. Smith was wrong but that of Mr. Jones was right. It would be his task to look at the use made of the powers under the Act. To consider, for example, whether he saw emerging any change in the pattern of their use which required to be drawn to the attention of Parliament. To enable him to see such a pattern"—
and I ask the noble Lord to pay particular attention to this sentence—
"and to contain his workload, we envisage that he should carry out his work in a concentrated period once a year to provide a snapshot of the use made of the powers". [Official Report, 8/3/84; col. 405.]
In that debate I undertook that we would hold the debate a month ahead of renewal. Your Lordships are aware that that leaves only 11 months of the Act to run before we have the debate. It was important that we should have the right man, and I am certain that we have him. Your Lordships only have to read his biography reference, if you have not met him to know that. We appointed him in December. Had he reported earlier, it would have been a report not on 11 months but on 10. Your Lordships are entitled to say that that is what you wanted; but it was not what I undertook to give you.
We have therefore had a very short time in which to present his report. It was received on the 15th February, which is Friday of last week, and my right honourable friend placed it in both Houses by Tuesday, having read it over the weekend, and he replied the following day. I greatly regret if your Lordships find that discourteous. It was certainly not intended to be so. I believe that the work done was properly done. I believe that to have started it sooner
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would have reduced its value, and to have received it sooner would not have been possible. Therefore, while I regret the shortage of time—and your Lordships might want us to play it a different way next time—it seems to me that I honoured both the letter and the spirit of the undertaking.
The second charge which the noble Lord, Lord Mishcon, courteously made against me was that there was completely inadequate time to consider the Tenth Annual Report of the Standing Advisory Committee on Human Rights for Northern Ireland. That report deals exclusively with Northern Ireland affairs. It covers a period of 12 months ending on 31st October last year. It is printed in a volume of 111 pages, of which rather fewer than two are devoted to the workings of the Act, which I am asking your Lordships to review. We do not control the date at which it is published because the Standing Committee is independent and its arrival today is a coincidence. I should have found it even more upsetting had it arrived tomorrow. The noble Lord, Lord Mishcon, is about to tell me that it was forwarded under a letter dated 7th December. That is perfectly true and this is also a document published by the Stationery Office in great detail, and I am told that that is the time that it takes to produce. I freely admit that I had given no thought to the availability of this document for this debate because so far as I can discover, it has never been referred to in earlier debates on previous legislation in this context. The fault is mine; but, on the other hand, it is two short pages and the most pungent parts have been ably quoted to your Lordships at dictation speed by the noble Lord, Lord Mishcon.
As I am on the subject of this report, the noble Lord, Lord Hylton, asked why various people were not consulted. I refer him to the very first paragraph of the report of Sir Cyril Philips. He says:
"For this purpose I have drawn on three main sources—the relevant statistics and some hundreds of official files of cases, and my personal consultations with police and officials concerned."
Those the noble Lord acknowledged.
"Secondly, consideration of the role of the Home Secretary and the Secretaries of State for Scotland and Northern Ireland; and, thirdly, the views of interested people and groups including those Members of Parliament who have approached me and the officers of the National Council for Civil Liberties and of the Cobden Trust who have been monitoring the operation of this Act."
I believe that he was remarkably thorough in the time available to him.
I revert to the report of the Standing Advisory Committee for a moment because it has been mentioned. There was a remark that there has been one exclusion order from Northern Ireland to Great Britain. My advice is that there were two exclusion orders from Northern Ireland, one in July and one in September, and both were exclusions from the whole of the United Kingdom. There were only three exclusion orders the other way round. Three exclusion orders were made despite the very small numbers in 1984, which we welcome. There remain some 240 extant exclusion orders. The Government would certainly not be happy for the subjects of many of those orders to be allowed to return while the present level of threat continues.

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Under the present Act all new orders have a limited life and orders under the earlier legislation are now due to expire in March 1987. We shall be reviewing each case carefully in the next two years, and I assure your Lordships that a fresh order will be made and exclusion maintained only where there are very cogent grounds to do so. As the noble Lord, Lord Wigoder, predicted, there have been no prosecutions under Section II of the Act. It is a section which is rarely used and it has been the subject of wide debate. I shall not dwell on this because I dwelt on it at length in Committee on the Bill, but may I say to your Lordships that we believe that its power is largely deterrent and that its existence on the statute book improves the supply of information.
The noble Lord, Lord Wigoder, asked specifically about tape recording. As my right honourable friend said in his letter to Sir Cyril, he will be deciding as soon as possible whether interviews with people detained under this Act should be included in the tape recording field trials. While it is clearly desirable that a person so detained should, so far as possible, enjoy the same safeguards as anyone else in police custody, there are a number of particular difficulties. For example, a copy of the tape made is given to the defence. There is provision for it to be edited to remove sensitive material, but even an edited tape would suggest the extent of a terrorist's co-operation with the police and lay him open to reprisals from his colleagues. There is a clear risk of deterring confessions and the giving of incriminating information.
On the figures for extensions of detention in a more refined form, I shall have to write to the noble Lord, Lord Wigoder, as I shall, if it proves proper for me to do so, on the subject of the destinations of those deported.
The noble Lord, Lord Monkswell, suggested that we were harassing the Irish. I can assure the noble Lord that, in spite of the roll of dishonour which the noble Lord, Lord Fitt, repeated in part a moment ago, there is no question of the Act being used to harass the Irish community in Great Britain. It is a measure designed to protect innocent people of all racial and religious groups from the activities of a minority who seek to promote political change through violence. I refer the noble Lord to what the noble Lord, Lord Fitt, said earlier.
The noble Lord, Lord Hylton, suggested that there was harassment of stereotypes, and the noble Lord drew a stereotype of a man in jeans and a ragged beard, suggesting that the intelligent terrorist would wear a bowler hat and a well-pressed suit. If the noble Lord had travelled on the shuttle as often as I have, he would have noticed that there is sartorial continuum among those who are detained by the police at all, who are as wise as he is to the tricks of the infidel. I instantly regret that word; it has a religious connotation. I mean the tricks of those who seek to do terrible things in this country.
The police controls at ports are necessary and they are necessarily selective. Those operating them are certainly well aware that terrorists are likely to adopt different forms of dress. I am saying in someone else's words what I said a moment ago in my own words and although they may be better, I shall spare your Lordships' repetition.
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The noble Lord, Lord Monkswell, asked why a person who is excluded does not have access to judicial review. Where the power of exclusion is used, much of the evidence against a person is such that it cannot be produced in court. The case may rely heavily upon sensitive intelligence which could easily be traced back to its source if it became known to the subject of the exclusion order or to his friends and associates. This would prejudice the source and even in extreme cases lead to the death of the informant. I ask the noble Lord, who reminded us about his children, to remember the children of those who might die as a result. Other police operations and the flow of information which leads to convictions in the courts might also be adversely affected.
Nonetheless, people subject to an exclusion order can make representations in accordance with the provisions of the Act. The function of the advisers is to protect the interests of the subject of an exclusion order by ensuring that any representations he makes are given an impartial second scrutiny following which my right honourable friend personally reconsiders the case.
The noble Lord, Lord Hylton, asked about the derogation which had been removed from the ECHR protocol. I note that the Standing Advisory Committee on Human Rights for Northern Ireland welcomed this decision. We do not believe that any changes are required in United Kingdom law as a result. The withdrawal of the derogations took account of the fact that legislation on internment and on detention without trial is no longer in force, and the view of the Government that remaining emergency powers are consistent with international law.
Your Lordships want to conclude this. Since others have been kind enough to quote my speech of 6th February 1984 I shall quote another part of it (col. 931):
"One of the paradoxes of democracy is that, in order to defend its essential components from those who seek to destroy them entirely, it is from time to time necessary to constrain some of those components themselves. Here there is a question of balance; for it is not much consolation to be free if, as a consequence, you are also dead".
That is the question of balance in your Lordships' hands. I hope that the noble Lord, Lord Monkswell, will not ask your Lordships to strike that balance, because I do not believe that it would be consonant with the normal way we conduct things. It is of course for him, but I ask your Lordships under no circumstances to deny to Her Majesty's Government and the security forces the powers which they need to protect your Lordships and your kindred from terrible things.
Lord Monkswell: My Lords, I thank the noble Lord, Lord Elton, for giving way at this point.
Lord Elton: I have not.
Lord Denham: My Lords, if the noble Lord, Lord Monkswell, wishes to intervene, there is a formula. He says, "Before the noble Lord sits down, will he answer the following question?".
Lord Monkswell: My Lords, before the noble Lord sits down, could he answer the following point? I should like to say to the House in passing that I apologise if any inconvenience and upsetting of the normal channels has been forthcoming. I make the point that I shall seek to pursue my case if the noble Lord gives me the answer that he would fail to withdraw the order.
Lord Denham: My Lords, this is getting to be a little more than a conventional intervention. Before my noble friend finally replies and then sits down, I think the noble Lord may not be aware that if he divides the House on an order without having given notice that he is going to do so he is breaching a convention which has never been breached before in this House. Personally, I would take it very hard if such a convention were breached.
It was agreed by all parties for this reason. Divisions on orders very seldom take place, and unless one knows that a Division is going to take place on an order the expression of the House will not be a true expression, because no noble Lord would have had the notice that there was going to be a Division on it. This agreement has been made between Leaders and Whips of all parties, and indeed between the Cross-Benches, and this is a convention which has never been broken. I have received no notice from the party opposite, or indeed from the noble Lord, Lord Monkswell, that a Division was going to take place. Therefore, if a Division were called I would regard that as a total breach of this convention, and a breach of trust.
Lord Mishcon: My Lords, before the Government Chief Whip sits down and before the noble Lord, Lord Elton, respectively sits down, may I be permitted to make the position of the official Opposition quite clear? We recognise the correctness of what the Government Chief Whip has just said. We would add to it, having had this intimation of a Division—which I still hope will not be called, and I ask my noble friend to listen to my words, if he would—that, as I understand it, the Government were good enough to honour their pledge by seeing that the debate on this order took place this afternoon. It is by sheer coincidence that the other place has not yet reached this on their Order Paper. It would again be contrary to our tradition if we were to vote against the democratically elected House on an order, and it is by sheer chance that we do not know what the decision of the elected Chamber is. For those two reasons the official Opposition would not wish to participate in any Division.
Lord Elton: My Lords, if I may rise from my noble friend's lap, as it were, I would welcome first the helpful intervention of the noble Lord, Lord Mishcon, on what is a very serious matter. I will secondly say to the noble Lord, Lord Monkswell, that if I did not by that speech convince him of the Government's determination to get these powers, I do not know how I ever shall.
8.26 p.m.
The Deputy Speaker (Lord Aylestone): My Lords, the Question is, That this Motion be agreed to?
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As many as are of that opinion will say, "Content"?… To the contrary, "Not-Content"? … I think the "Contents" have it.
Clear the Bar.
Tellers for the "Not-Contents" have not been appointed pursuant to Standing Order No. 51. A Division therefore cannot take place.
I declare that the "Contents" have it.
Motion agreed to.

London Regional Transport (Amendment) Bill
Brought from the Commons endorsed with the certificate of the Speaker that the Bill is a Money Bill; read a first time, and ordered to be printed.

Films Bill
8.30 p.m.
Lord Lucas of Chilworth: My Lords, I beg to move, that this Bill be now read a second time.
Two months ago we were given the opportunity, by virtue of a short debate initiated by the noble Lord, Lord Lloyd of Hampstead, to discuss the White Paper on film policy which was published in July 1984. Much has happened since then. The Films Bill, which is based on the policy outlined in the White Paper, has completed its course in another place and is now before us for consideration.
The body which will succeed the National Film Finance Corporation has taken shape more clearly, and a copy of the heads of agreement between the proposed participants in the successor body and the Government has been laid in the Libraries of both Houses. There have also been significant events in the fortunes of the industry. Sadly, more cinemas have closed. On the other side, British films have had some major successes and are well represented in the recently-announced Oscar nominations. It is therefore against this background of changing fortunes within the industry that I should like your Lordships to consider the purpose of this Bill.
The key is the Eady levy; introduced in the middle of the century, it was seen as a means of redistributing money from the flourishing exhibition sector to the then weaker production sector. Similarly, the quota system introduced in 1927 had sought, albeit indirectly, to foster the production of British films, by ensuring that a specific proportion of films shown at cinemas had to be British. Both measures—the levy and the quota—required a whole raft of regulations and controls for their enforcement. At that time, with annual box office admissions running at a level of nearly 1,300 million in the early 1950s, it was thought that the exhibition sector was well capable of standing the strain imposed by these heavy administrative burdens.
Now the position is reversed. Cinemas are struggling to survive. Box office admissions slumped in 1983 to less than 70 million a year and at least 18 cinemas with a total of 36 screens have closed since the White Paper was published last summer. The amounts raised by the

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Eady levy have dwindled, and the portion going to British film makers (or their nominees) fell from £2.7 million in 1982–83 to a provisional figure of £1.6 million in 1983–84. On the other hand, the production industry is booming. Studios are full and British films are scoring major successes in both at home and abroad. The Oscar achievements of "Gandhi" and "Chariots of Fire" may well be repeated this year, since eleven Oscar nominations for "A Passage to India" and seven for "The Killing Fields" are indicative of the new areas and markets that are opening.
The House will be aware of the opportunities offered with the advent of cable and satellite broadcasting services. Less obviously, perhaps, the recent innovation of video to promote pop records has quickly established a sizeable new sector in the market. For the first time the British record industry's awards this year included a category for the best pop music video. As my noble friend Lord Mersey observed during our debate on the White Paper, we are now acknowledged as world leaders in this field. It is pleasing to be able to report that the award was won by a video made here in England at Shepperton Studios.
It is entirely right and sensible that if the fortunes of the different sectors within the film industry have changed, Government policy should be adapted to reflect that change. Accordingly, we have decided to sweep away the burden of registration, licensing and quota, and to abolish the Eady levy. Furthermore, in response to the Monopolies and Mergers Commission's report, the Government have announced plans to investigate the effects of relaxing the barring arrangements that many independent cinemas claim deprives them of fair access to profitable films. It would be optimistic to think that these actions could bring back the huge cinema audiences of the 1950s, but the Bill will provide some relief to the hard-pressed exhibition sector.
Before deciding to abolish the Eady levy, we considered how this would affect the production sector and the specific bodies which had benefited from the proceeds of the levy. The immediate beneficiary of the levy has been the National Film Finance Corporation. This is financed by an annual grant of £1·5 million from this source. The NFFC is generally recognised as having performed well in its aim of assisting the development of the production sector by part-funding low- or modest-budget British films. By providing crucial "up-front money" it has helped over the years to produce such classics as "Genevieve" and "The Third Man", and, more recently, films such as "Gregory's Girl" and "Another Country". We have decided that this work should continue, but with two significant changes.
First, the NFFC will be dissolved and replaced by the British Screen Finance Consortium, a private sector partnership financed between private and public sector monies. We believe that this will help to improve the commercial edge of the investment decisions. We believe that it will enable those directly involved in the industry to play a greater part in helping to develop new talent. The partners in the consortium will be Channel Four Television, Rank, Thorn EMI, and members of the British Videogram Association.
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A copy of the heads of agreement between the prospective partners and the Government has been placed in the Library. The House will appreciate that this document takes account of a number of points raised during our earlier discussions and in another place. It provides significant safeguards regarding the use to which the Government's financial contribution may be put.
Secondly whereas the NFFC's annual external funding since 1981 was £1·5 million, the new body will have available twice that amount: £1·1 million from the participants, and, for five years, a contribution of £1·5 million from the Government, and additionally £0·5 million from the Government for the management of the project development scheme and the production of short films.
There is one fundamental aspect in which we do not expect the NFFC's tradition to change; namely, the type of film that will be supported. The NFFC's role has always been to support British films aimed at the commercial market, but it has also focused on assisting new and rising talent in the industry. Another important part of the production industry is the non-commercial film-making sector, for which the Government provide substantial support through the various grants made by my noble friend Lord Gowrie from the budget of the Office of Arts and Libraries. But the function of the NFFC and, in the future, of the new consortium is concerned with commercial filmmaking and with the one important part of that sector where we believe there is at least initially a case for special subsidy; namely, low- and modest-budget British films, including "shorts", especially those made by new talent, and of course the project development to which I have referred.
Besides the National Film Finance Corporation, the Eady levy also provided an element of funding for the National Film and Television School, and for the British Film Institute (BFI) Production Board. We have considered the needs of these bodies, and have made arrangements whereby the school will receive £600,000 annually for five years (more than it has received in the past from the Eady levy) from the BBC, the independent television companies and the cinemas. In addition, the Government have already undertaken to make a special grant to the school of a quarter of a million pounds to improve its television facility. As regards the BFI Production Board, we have endorsed the recommendation of the Cinematograph Films Council that in this final year of the levy the board should receive a sum from the levy equivalent to three times the grant it would have expected.
That is the background to this Bill and what it seeks to achieve. I should like now to outline briefly two of the most important clauses. I do not intend to weary the House by going through every part of the Bill in detail, particularly as many of the clauses are clearly described in the explanatory and financial memorandum, but I wish to offer a short explantion of the major features.
Clause 3 of the Bill deals with the NFFC. It enables the Secretary of State, with the approval of the Treasury, to dissolve the NFFC at any time after the Eady levy is terminated. It provides that upon dissolution any of the corporation's property or rights

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may be vested in the Secretary of State, who shall deal with them in such manner as he thinks fit for any purpose connected with the British film industry. It further provides that such rights may be transferred to a British company or partnership on condition that it uses its best endeavours to encourage the production of British films on a commercially successful basis. Thus, this condition will apply to the transfer of the NFFC's portfolio of rights and interests in films, estimated to have a total value of about £600,000 a year, to the British Screen Finance Consortium.
Clause 3 also provides that if upon dissolution of the NFFC any of the corporation's liabilities are vested in the Secretary of State, they may be transferred on agreed terms to the NFFC's successor. The purpose of this provision is to enable forward commitments to film producers made by the NFFC to be taken on by the BSFC, together with enough cash from the NFFC's assets to meet those commitments. It is our intention that any assets remaining after the NFFC has been dissolved, and after provision has been made for meeting liabilities, should be transferred to the British Film Fund Agency for distribution to eligible British film makers. Finally, Clause 3 empowers the Secretary of State by order to repeal the National Film Finance Corporation Act 1981 when the NFFC has been dissolved.
Clause 5 is particularly important. It enables the Secretrary of State to give financial assistance to the successor to the NFFC. This will take two forms. First, there is the provision of £1.5 million annually for five years for co-financing the production of British films; and, secondly, £500,000 annually for five years will be provided for project development work and for the production of short films. The House may be aware—as certainly will be those noble Lords involved in the film industry—that the provision in respect of "shorts" was inserted recently by the Government, in recognition of the valuable role of shorts in enabling new producers to "cut their teeth" on a modest project and the need to replace the stimulus provided by the Eady levy to the production of shorts. This clause therefore sets the framework within which public finance for the production of low-budget commerical films will operate.
I do not pretend for a moment that this Bill will solve all the film industry's problems, or bring audiences flocking back to the cinema. There are no magic remedies here. However, I believe that the Bill is based on a realistic assessment of the problems and that it offers a most sensible way forward. It is universally recognised that the Eady levy is an anachronistic burden on a struggling sector of industry. The Government are committed to abolishing it at the earliest possible date and the Bill makes this possible.
We could have stopped at that, simply leaving the beneficiaries of the levy—and particularly the NFFC—to collapse or to find alternative funding elsewhere. We have not, as has been suggested, walked away from the problems. We have sought an opportunity to continue the work and tradition of the NFFC, and have made arrangements to expand its funding and to enhance its commercial edge by placing it in the private sector. We have made arrangements
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for the funding of other bodies dependent on the levy for part of their income. This Bill is based on a careful appraisal of the needs of the commercial film industry and provides the framework within which the industry can operate to advantage in the future. I commend it to the House.
Moved, That the Bill be now read a second time.—(Lord Lucas of Chilworth.)
8.47 p.m.
Lord McIntosh of Haringey: My Lords, there are a number of things in the early part of the noble Lord's speech with which I think all Members of your Lordships' House will agree—his tribute to the recent achievements of the British film industry in world markets and world esteem, and his hopes for the success of British films in this year's Oscars. We all share those hopes. I fear, however, that our welcome for this Bill goes no further than that.
There are many aspects of this Bill with which we are profoundly unhappy and which we believe show a failure not so much of analysis of the past—for with much of that we agree—but of constructive analysis and prescriptions for the future. I shall not attempt to summarise in the time I have available anything more than the bare bones of film policy over the period since 1927, when I suppose we may say a Government film policy started in this country. The three major elements of it have been the quota set up by the 1927 Act and allowed to fall into disuse in 1983; the Eady levy, to which the noble Lord has referred at some length; and the National Film Finance Corporation, together with the various elements of arts funding which was also referred to.
The only point that I want to make about that combination of measures is that they were all carried out in the context of the film industry being a private-sector industry, a commercial industry. There has never been any suggestion, certainly not from this side of the House, that there should be anything other than a commercial film industry. We believe that the need for flexibility, the need for innovation, the need for risk taking make this one area where commercial interests, suitably safeguarded—and I make that point very seriously—make it low on the list of candidates for nationalisation. Perhaps. I may put it that way.
There have been public sector film industries of great success. I think of UFA in Germany in the 1920s, for example, but that is not to say that there are not countries and times when the public sector film industry can be of great importance. I think also of the National Film Board of Canada and I have no doubt that there are other examples which will occur to noble Lords who are more experienced in the industry than I am. But it is the point that there must be suitable safeguards to a commercial film industry, and it is that view which is paramount in our objections to this Bill.
The major happening over the last 20 or 30 years which has transformed the film industry is well known to us all: it is the advent of television and the fact that the television audience for "moving pictures", if I may use the old-fashioned term which describes both, is 20 times the audience in the cinema. I will not go over the other effects which that has in terms of the sources of possible financial support for the industry, but will

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only repeat the wise words of my honourable friend Mrs. Dunwoody in another place when she said that we were talking here not so much about the film industry as about the production industry serving both film and television and also, of course, potentially serving cable and direct broadcasting by satellite. We have to think of the production industry, with which we are most concerned, in the context of television as well as in the context of film.
I turn now to the National Film Finance Corporation, which is to be abolished and replaced by the British Screen Finance Consortium. I am grateful to the noble Lord for the information, which I did not have before, that the heads of agreement are in the Library; and I shall certainly study them in great detail. But, of course, the point about those heads of agreement is that they are not in statute and they could be changed at any time. Consistently during Committee stage in another place it was pointed out to the Minister by his own Back-Benchers among others that the British Screen Finance Consortium is not independent: it consists of Channel 4, two of the major distributors and the British Videogram Association. I am not accusing them of malice of any kind: far be it for me to do so, certainly when they are contributing this money. But it is not independent of the interests of the production side or of the audience in order to represent the interests of the production side and the audience for films and for television.
The safeguards, as I have said, are not enshrined in statute, and we shall attempt in Committee, and as the Bill goes through this House, to see that they become statutory. There is no assurance of either the creative or the financial freedom for this consortium which we should like to see. There is no adequate recognition in statute of the responsibilities which go along with the fact that this consortium is taking over public assets. After all, we are talking about an annual income from the portfolios of some 750 films which have already been financed in this way. Above all, there is no continuity and there is no assurance of continuity after a finite period of years for which promises have been made. We on this side of the House will seek to see to it that there is an authority which achieves the objectives which may well be set out in the heads of agreement. We shall also seek to remove the provision in Clause 3 which says that the conditions for this British Screen Finance Consortium are such conditions (I quote)
"as [the Secretary of State] thinks fit".
But, above all, the issue about the replacement for the National Film Finance Corporation is that it does not have enough money. The noble Lord and his right honourable and honourable friends have made comparisons with Eady money now. Of course, that is very easy to do. It is a fact that the proceeds of the Eady levy have declined consistently—that is shown very clearly in the graph at the back of the White Paper—but that does not mean that the level reached in the last few years is an adequate level for the support of the British film industry. For example, if we look at the period from 1958 to 1966, the Eady levy was producing something like £18 million a year at 1984 prices. That is a level which not only seems reasonable in the sense that at that time it was producing a successful film industry, but it is also a level—and
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this ought to be most important to this Government—at which there might be a serious chance of getting consistent City funding for the film industry. But we ought to be thinking about the gearing of financial support for the film industry rather than the penny-pinching, cheeseparing comparisons with the totally inadequate 1984 level.
It is also true that, apart from the money provided by Channel 4 for productions and promised for the rest of its first five years, the support from the television contractors has been minimal. Yes, they have been buying films, but they have been buying films at a fraction (so small a fraction that it is insignificant) of the original cost of production and at nothing like the level of financial support that might be thought to be necessary, even if you take the analogy of printing run-on costs. These are derisory amounts—something like £6,000 to £7,000 an hour, when the production costs of new drama for television is more in the region of £80,000 an hour. So we on this side of the House will support whatever amendments are put forward to provide for a levy which will replace the Eady levy, not at the level it is now but at the level it was at the time when it was most effective.
I do not have any particular decision at the moment as to the basis on which that levy should be. I think that needs a great deal more discussion. I confess that I am prejudiced at the moment in favour of the amendment moved successfully by Mr. John Gorst; namely, that the levy should be based on the size of the television audience which views the films. But something of that sort will have to be introduced into this Bill if it is going to provide anything like adequate support for British film production. Then there is also the possibility, not of blank video and audio cassettes, which were referred to in this week's Green Paper, but of a levy on pre-recorded cassettes, which is a matter of justice as well as of prudent financial provision.
Then we come to the question of fiscal incentives, and I would remind your Lordships that it was only in 1983 that the Government gave an assurance of five years' continuity for the fiscal incentives for film production which had been introduced in 1979. It took only 12 months for them to go back completely on that and to return virtually to the position where films are treated as plant and machinery. As my noble friend Lord Willis said in the debate just before Christmas, which I unfortunately missed because I was in hospital, films are not produced by plant and machinery. Films are not produced like sausages, where you have a successful product and it goes on selling. Once you have produced a film you sell it once and perhaps you have some international and television sales, but then you have to start again with the next item of investment. To treat it as plant and machinery (even if there were further provisions, as I understand there may be, for writing off on current account as income accrues, or for what is called cost recovery, which I do not fully understand) is simply not adequate.
There is no reason why the film industry should not follow, in terms of fiscal incentives, the analogy of the oil industry, where exploration and drilling are still permitted to be a special case and to have 100 per cent. capital allowances. Here, perhaps, I may say very briefly that it is an absurdity to think that the Business

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Expansion Scheme is going to fill the gap. It is not only a matter of the maximum amount that is possible from any single investor. One might think, looking at "angels" in the London or Broadway theatre, that a consortium could be made up with a number of people contributing £40,000 a time, although the amounts involved in film are much greater than they are in theatre. But it is the lack of continuity of production companies which is going to be the death blow of any attempt to have the Business Expansion Scheme fulfil the role which the Government seem to think it will.
Then there is the question of training. There have indeed been some indications of continuing support for the National Film and Television School. The noble Lord, Lord Lucas, has just referred to a figure of £600,000 per annum for five years, and I welcome that. It was referred to by a Government spokesman in another place as being a dowry; and one of my honourable friends said that it was more like an alimony. I deny the analogy. An alimony continues. The only true analogy is the death benefit. That provides once for current expenses and then it is no more. If you compare the provision for training in this country of £600,000 a year for the National Film and Television School, with the kind of provision which is made in, for example, France where £22 million a year is made available for training, marketing and promotion, you can see that this is not exactly generous treatment.
It is necessary to say very briefly, because a number of times the noble Lord used the phrase "British film", that according to the schedule we are not talking about British films at all. In paragraph 4 there is a definition, which is completely acceptable to the European Community, that "British"' means a member of one of the member states of the Community. In other words, a German film produced in Italy with French money could qualify as a British film. I accept that there are some safeguards in paragraph 5(3) of the schedule, which refer to the amount of work taking place in the country. But the point here, surely, is that no other country in the Community has knuckled under to the European Commission in the way that we have done. They all keep what we would normally understand as being a reasonable definition of a national film industry, and they have all kept to themselves the right to provide para-fiscal help to their own film industries—that right which we have so nobly denied ourselves.
It all comes down to whether we are talking about film as a culture or as a business. I think that we have to do both and the Government are failing on both accounts. They are connected. The external earnings of the British film industry last year were of the order of £93 million and the spin-off from that, in terms of the prominence given to our culture, and the opportunities given to us to provide exports of manufactured goods and services and to attract tourism, are very great indeed—in fact, incalculable. So even taking it purely in business terms, we have an asset here whch it would be criminal to endanger, let alone to throw away.
The noble Lord referred to there being no magic remedies for the film industry, as if he were repeating
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the famous phrase of his right honourable friend the Prime Minister: "There is no alternative". I think we shall be able to show the House and the Committee in due course that there are many alternatives to the solutions proposed by the Government. There are many alternatives which have been successfully adopted by other countries which have a keener appreciation of the cultural and business benefits of a flourishing film industry.
With notable exceptions, we are not too surprised if there is a failure to understand the cultural need for a film industry or the role of film in our national culture. That does not surprise us too much when we have seen the level of grants being given to the Arts Council. What really offends me is the lack of business judgment shown by this Government in the way in which they have simply—to use the noble Lord's own phrase, which he then denied—walked away from the real problems of the film industry.
9.4. p.m.
The Earl of Winchilsea and Nottingham: My Lords, at this stage of the Bill, I should like to direct my remarks to possible fund-raising methods in addition to those proposed by the Government, which could quite easily be employed to assist the funding of British films. In 1984, there were over 4 billion individual viewings of films transmitted by all four television channels. This staggering figure is based on reasonably accurate rating mechanisms that are used by television companies to work out the number of viewers watching a particular programme.
The showing of a feature film, even a first-run feature film, on television is probably the cheapest way available to a programme planner of filling in 90 to 120 minutes of television transmission time. It is also probably the most popular type of programme. The price paid by TV companies for the screening rights for films works out on average at about £63,000 per film for first-run films. This figure dramatically declines to between £6,000 and £7,000 if old, already shown-on-TV films are included in the general package of films and filmed series negotiated for. When the vast audiences for films on television are taken into account, plus the very high costs involved in the production of even a low budget feature film, it can be fairly said that television is not paying a fair price for the high quality product it is getting and large profits are made from films shown on television.
Furthermore, television is constantly drawing on a rapidly depleting library of films. In 1984 alone, there were about 1,584 films shown on all TV channels. The buying of films for television is done by only two men—one for the BBC and one for the ITV companies. This rather cosy cartel normally operates on a gentleman's agreement, which effectively keeps down to artificially low levels the prices paid to film companies. This agreement occasionally goes up in smoke, as we saw recently involving the American film series "Dallas".
So what can be done to ensure that fair prices are paid? Several suggestions have been put forward. One is based on the rating mechanism already mentioned, whereby a charge of 0·25 pence per viewer of film on television would be made, payable by both the BBC

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and ITV, and paid annually into a central fund which could then be distributed to the film industry. This could have the effect of increasing the TV licence fee, but only by, it is estimated, 28 pence and it would account for less than 1 per cent. of the ITV companies' total expenditure on programmes. Another suggestion is the imposition of a 10 per cent. levy applied to the total film budgets of all four TV channels, which amount to £100 million annually. This would also produce the same amount as the first suggestion; namely, around £10 million. Of course it could be argued that the introduction of such a levy would result in fewer feature films being shown on TV. Since broadcasters pay much less for bought-in material, including feature films, than they do for in-house productions, the effect on broadcasters' use of feature films is, despite their protestations, unlikely to be considerable.
But the TV companies are by no means the only source of possible support that could be available to the domestic film industry. The incentive which was removed in the Finance Act 1984 was responsible for attracting City investment, without which it would be extremely doubtful whether the great film successes of recent years which have already been mentioned—"Gandhi" and "Chariots of Fire"—would ever have been made. They earn for us as a nation not only large amounts of currency, both overseas and domestic, but also enormous international prestige and goodwill, to which the noble Lord has already referred—by-products which cannot be calculated, such is their value.
The Government's Green Paper on recording and rental of audio and video copyright material, published the day before yesterday, is to be welcomed. It is long overdue. Many people have reservations about its content, myself included, but it is at last a step in the right direction. My main reservation is the proposed upper limit on the amount of royalty payment allowed. In both the audio and video cases, they are far too low and will not do much good to anybody by the time they are collected, administered and distributed.
Perhaps it would be appropriate at this time to remind your Lordships that without the film industry there would be no video industry and there would be no television industry. Both owe their existence to the film industry, and therefore it is only right and proper that both be required to support it more than they do at present. However, I am very glad that the Green Paper is at last with us and I note that 30th April has been set as the deadline for when suggestions will be acceptable for consideration.
In conclusion, with the impending advent of cable and DBS broadcasting, there will be an ever increasing demand for filmed material of all types to fill all those hours of programme planners' schedules. If there is not a ready, healthy, well financed and flourishing British film industry, turning out low, medium and even the occasional high cost feature film, as well as shorts and documentaries of every description, then inevitably we shall be the recipients of a vast flood of the most dreadful American rubbish imaginable. I for one find that prospect horrendous—a horror which I am sure is shared by all noble Lords present as well as those who are not here tonight.
9.11 p.m.
Lord Lloyd of Hampstead: My Lords, I regret that I must begin by offering your Lordships an apology, as I am afraid that it is impossible for me to remain until the end of this debate. The noble Lord the Minister began by pointing out that I was responsible for initiating an earlier debate, as recently as last December, on the White Paper on film policy, which is of course implemented in this Bill. Therefore I am anxious to avoid any unnecessary repetition of the various points which I endeavoured to emphasise at that time.
However, I think that there are certain points which need some amount of re-emphasis, and there are of course a number of fresh points which have subsequently arisen. One of the extraordinary features of the situation is that the Government, on their side, apparently view with a considerable measure of euphoria—though I notice that on this occasion the Minister presented perhaps a slightly more muted version of it than one finds in the White Paper—what they see, as the outcome of the Bill, whereas on the other side, the industry is universally condemning it and indicating its inadequacies.
We have the very recent example of Sir David Lean, one of our greatest film directors, fresh from his triumph of directing "A Passage to India" and the many Oscar nominations which it has already received, coming back to this country after many years and being reported as saying:
"Now the Government is making it even worse over here. The powers that be have never really been interested in films in England".
I am afraid that that kind of verdict is only too representative of the general approach taken by the industry.
I should like to concentrate my remarks on two areas; one is the area of production, and the other is training. So far as production is concerned, the prelude to this Bill, as we all know, was the abolition of capital allowances, which in itself was a crippling blow to the industry. Subsequently, the Bill is proposing to abolish the Eady fund and also the NFFC. So far as the Eady money is concerned, we are all agreed that its abolition was necessary because Eady had outlived its usefulness. The real question is this: what has been put in its place?
We know of the sad events which occurred in the other place regarding the proposal for a television levy. There was all-party support for it in Committee in another place and it was passed—but then it was rejected at Report stage. It seems that those few Members of Parliament on the Committee who really understood the problems of the industry were extinguished by the majority who neither knew, nor perhaps even cared, about the future of this great industry. Yet the arguments in favour of a television levy are extraordinarily simple.
There is on the one hand a great flourishing industry—the television industry—which has for years lived off the cinema at minimum cost. We know that there are more viewers of a cinema film shown on television in one day than there are admissions for a whole year to the cinema itself. Still the Government apparently cannot see that there ought to be some recognition of that fact, and some transfer of resources

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to that part of the film industry which provides so much material for television itself. The Government have preferred to heed the siren voices of the television lobby and at the same time to ignore the real needs of the film industry.
This is a great pity because I believe that the present Government genuinely wish to help the film industry. They appreciate to some degree the importance of that industry in the national culture. But it seems they are bemused by the vision of a free market which really does not exist. What exists is a cartel for the purchase of feature films for television, of which the film industry has been the victim.
It is a great failure on the part of television that it has neglected to realise the immense commercial sense in allowing money to be resiphoned into the film industry—which has played, plays now, and (one hopes) will continue to play, so vital a role in television's own existence and future. Both the television and the film industry need a steady supply of indigenous, medium-budget films. One has to take on board the point that by a "medium-budget film" one means these days a film which costs upwards of £1 million. One is not talking about blockbusters which cost from £15 million to £20 million but a production costing something in the order of £1 million to £2 million. Nevertheless, one is dealing with a pretty expensive product.
One knows—and this fact is frequently cited—that Channel 4, under the excellent aegis of Mr. Jeremy Isaacs, is doing a very good job in encouraging film making. I understand that Channel 4 are spending in the region of £8 million a year on films. But what must be borne in mind always is that those films are primarily for the television screen and not for the cinema.
If all this money is not to come from a television levy, then where is it to come from? The view generally accepted in the industry is that it needs a sum in the region of £10 million to £20 million a year to support the medium-budget film market. If there is not to be a levy on television, there remains at least the alternative of a levy on video tapes—both blank and prerecorded. I was most interested to read the Green Paper published yesterday, and was somewhat encouraged by the fact that it seems to be a good deal less negative than its predecessor.
I remember being responsible for opening a debate in your Lordships' House on the subject of that earlier Green Paper which was published in 1981; our debate was in 1982. I remarked, as indeed did many other speakers, on its negative approach towards the idea of a levy on tapes. Since then the Government have undoubtedly been doing some more thinking on the subject. What I found encouraging-and I hope that it will not be proved that I am reading too much into this—was what seemed to me a rather significant passage in the Green Paper which is to be found on page 9:
"It is far less clear for video than for audio what basis could be used to subdivide the levy proceeds among the main groups of beneficiaries and within each group. One possibility"—
and these are the words that I emphasise—
"might be for the film proceeds to be diverted to a central fund to be used in the film industry to support production".
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I certainly welcome that sentiment. Study of this matter has shown that, if one is to attempt to distribute the proceeds of a tape levy among all the possible individual copyright owners, it will prove to be a totally impracticable exercise.
The noble Lord the Minister is probably aware that the interim action committee, which is shortly to reemerge under the guise of the Screen Advisory Council, has been hard at work on this subject and is in the process of producing a working paper which endeavours to show how this problem can be dealt with in a thoroughly practical way—something for which the Government plead in this Green Paper. I should like to express the hope in that context that the Government will, having adumbrated that notion, pay serious heed to the constructive suggestions which I think will emerge both from that council, of which I have the honour to be a member, and, I think, from other sources which will show how this may afford an avenue for support for the film industry.
Then a word must be said about the so-called son of NFFC, now redesignated as the British Screen Finance Consortium. Many questions arise about that new structure. The main criticism is inevitably that it appears to be too commercially orientated. The Minister in the other place referred to the excellent prospect of carrying on the traditions of the NFFC, and that is apparently desired. But one cannot avoid some doubt as to whether the very special way in which the present NFFC has been able to perform its task by reason of its very independence can possibly be achieved in a body which is so commercially orientated.
I am delighted to hear that these draft heads of agreements are in the Library. I was not aware of that and I have not had an opportunity to study them. But I have been told by someone closely concerned in this matter that great care is being taken to ensure, for instance, the independence of the chief executive in the choice of projects. I certainly hope that that is so. But as the noble Lord, Lord McIntosh, pointed out just now, the real difficulty is to know quite what validity heads of agreement will have in a body of that sort. So much seems to be taken on trust.
We have the new notion of a limited partnership under the 1907 Act, which is a most unusual form of organisation. This Act has hardly ever been used. One wonders whether it may not create awkward problems. However, these are matters of detail on which I need not spend more time.
However, I should like to say a few words on the training aspect. From this point of view our attention is centred on the National Film and Television School. Naturally, I welcome the tributes that have been paid to that school. For instance, Mr. Lamont, in the other place, referred to the excellence of that school and its reputation for producing highly skilled film and television programme makers. Those of us connected with the school recognise that the Government's intentions here are perfectly sincere and that they are anxious to help the school and give it some measure of security—that is the phrase used by the Minister in another place. We certainly applaud their support of the financial policy, which has been the policy of the school from its beginning, that it should be a partner-

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ship between Government and industry, so that we should not have to look solely to public funds but that there should be support from the industry.
Nevertheless, a number of points arise as to whether the Government are adequately meeting these problems. I will only mention them very briefly because this is not the occasion to go into detail. The sum of £600,000 mentioned by the Minister, as he will know, has been explained by the school to be inadequate, to say the least, to cover the current costs of the school. I think this is a matter which is under consideration.
Moreover, the whole future of the school, so far as the industry's support is concerned, is being left to an extremely vague agreement to which the school itself is not a party. One has no way of knowing how this agreement may be enforced if there is any failure to comply with it or any change in personnel. Therefore, one is left with an uneasy feeling that one has a much less secure position than under the previous Eady position. Moreover, by the abolition of the Eady levy, the school has been deprived of the statutory backing that it was given in the Films Act of 1970, whereby the school was designated as a beneficiary of the British Film Fund—and that, of course, has put the school in quite a strong position in dealing with the industry because it has given it a legislative mechanism which gave the school access to the industry itself. The finances of the school have always been precarious. However, whereas one might have thought that this Bill would have been taken as an opportunity to render the school's financial future secure, I am afraid that it has in some ways added to that degree of insecurity.
I come to my conclusion. I say this with regret. It seems to me that this Government have failed—and it is a charge which could be levied against previous governments, too, but this evening I am only concerned with the Bill itself—to take proper account of the cultural significance of the film as a form of popular art of unique force and creative vitality and the immense contribution that film makes to the national culture. Secondly, the Government have failed to realise that that industry needs continuing support, as the whole history of European film has shown. However important the market forces may be—because we are dealing with a commercial product—those market forces alone do not suffice for the special position in which film necessarily develops.
Our apprehensions for the future overshadow to some considerable degree the more hopeful signs from which we can take comfort—the immense abundance of talent and the remarkable successes of recent British films. What we need to secure is that that abundance of talent remains within our own frontiers. There is a great danger that if we do not enable our film industry to develop fully, that talent will be weaned away to other lands and will not fructify our own resources which all of us, I think, agree, would be a very sad outcome.
9.30 p.m.
Viscount Mersey: My Lords, last December, I also took part in the debate initiated by the noble Lord, Lord Lloyd. I argued that the Government should not
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have any film policy, no controls, and that the film industry should be left to its own devices. However, in this Bill, we are principally concerned with the British feature film—quite a small part of the total amount of film exposed each year, yet the most important part. I agree that there should not be interference in feature film and certainly no restrictive control. I do, however, believe that the British feature film needs help and that such help should take the form of the new levy, or Gorst levy, that has already been mentioned.
Speaking from these Benches, I am of course heartily in favour of a free market economy. But, as stated already, such a thing does not exist where the British feature film is concerned. It faces not one duopoly but two: on the big screen, the duopoly of Rank and Thorn-EMI; and on the TV screen, the duopoly of the BBC and ITV. This means roughly that the British independent product cannot be shown anywhere. In the cinema the Rank, Thorn-EMI duopoly is American orientated. It is linked with Columbia, Warner, Fox, Universal, Paramount, MGM and Walt Disney. In that connection, I would pay a passing tribute to Mr. Clarence Nash, who did the official voice of Donald Duck for 50 years in seven languages and who died today.
You could perhaps say that the big screen is of minor importance because people are leaving the cinemas and going to the small screen. There is a catastrophic fall in audiences. On the television screens, with the BBC-ITV duopoly, I cannot see that DBS and cable have yet done anything to break the duopoly. The problem is one of in-house production. The television people say, "We don't want your product; we make our own". Jolly good they are, too. They include "Jewel in the Crown", "Brideshead Revisited", and so forth. "And" the television people might continue "if we need outside material, we can get it at only £5,000 an episode for 'Kojak', 'Quincy', 'Cagney and Lacey' from the United States of America." Therefore, they say, as stated by many noble Lords, "We will only take British feature films at the same sort of rate. Too bad if it costs £1 million to make".
I do not deny that this sorry state of affairs is to an extent the fault of the British film industry itself. In the mid-1950s, it rather turned up its nose at the infant television and developed separately. In America, quite the opposite happened. Film joined forces with TV. In America, they became allies; here, they became enemies. That is unfortunate, but it is history now.
Still worse, hostilities continue today. Mr. Brian Tesler who was chairman of the Independent Television Companies Association, gave evidence to the Committee on the Funding of the Arts in 1982 as follows:
"It is an arid and destructive attitude of the British film industry that the television industry owes it a living. If it were not for television, the British film industry would not exist at all".
But then, the noble Lord, Lord Lloyd of Hampstead, said to me, at tea only the other day, completely the opposite:
"If it was not for the film industry, the television industry would be dead".
The noble Earl, Lord Winchilsea, has just agreed with that. The noble Lord, Lord Lloyd of Hampstead, cited, quite rightly, the huge numbers of feature films

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that were shown on all television channels over the Christmas period. Certainly it is feature films that people most want to see on television. Video cassettes are mainly features, and the most successful and most expensive cable channels in the USA run features. The best that television can do "in house" may be brilliant, but it just is not as brilliant as the British feature. In the final analysis, the "Jewel in the Crown" is not as brilliant as "A Passage to India".
So the British feature does need help, but, I would suggest, not by way of capital allowance, as some noble Lords have suggested. Investment in films by people less interested in the medium than in tax relief can lead all too easily to a bad, expensive product. The Australian experience of 150 per cent. tax relief was not a happy one, and I wonder whether capital allowances in this country were even effective, because I cannot detect any rise in cinema attendances between 1979 and 1984.
Now we have the business expension scheme. But what I regard as better than either is voluntary sponsorship of feature by interested companies. I was heartened to read what my noble friend Lord Gowrie said in last Sunday's Observer, about business sponsorship of the arts. He wrote
"Over the past decade, corporate sponsorship of the arts has risen from a few hundred thousand pounds to £15 million. It is still rising".
Businesses sponsor arts more esoteric than film. Barclays Bank sponsored the art of mountaineering when it backed the British ascent of the south face of Everest. The Midland Bank sponsored an entire "Ring" cycle at Covent Garden. What would be wrong with a "Morgan Grenfell Film" instead of a "Warner Brothers Film"? Would it not be really rather suitable for Prudential Life Assurance to sponsor an Agatha Christie murder mystery?
Yet experience has shown that this does not work unless, to begin with, there is adequate money provided from a central fund. For business sponsorship to succeed it is essential that the proposed successor to the NFFC—the British Screen Finance Consortium, or BSFC—should back British film in a meaningful way, not with £3 million but with something much closer to £20 million, as the noble Lord, Lord McIntosh of Haringey, has said already. The source of the revenue must be a levy on all feature films shown on television screens, whether broadcast or on cassette.
The point about an increase in the BBC licence fee of only 30 pence has already been made. It is a little less than the cost of two first-class stamps; it really is peanuts. That would yield £10 million. The essential springboard for the British feature industry must be an adequately-funded central body. It is true that some people can extract realistic sums from television for their products—I think of Mr. "Cubby" Broccoli and his James Bond films; but the British film-maker, in particular the young, unknown film-maker, cannot. He is the chap who is forced to sell for £10,000 what it cost £1 million to make. But he could be the "Cubby" Broccoli, the David Puttman, or the John Schlesinger of the future. Obviously all famous film-makers started as promising youngsters; and in the past many of them were helped by the old NFFC,
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with meaningful sums. It is fair to say that without such funding there would not have been, for instance, "Tom Jones", "Gregory's Girl", "The Duellists", or "Bugsy Malone". Carol Reed might never have started his film career: no "Our Man in Havana", no "Fallen Idol", and, last but not least, no "Third Man". My noble friend Lord Lucas himself agreed with me on that point.
I wonder whether I may appeal to the Government on the grounds of patriotism. Can my noble friend Lord Lucas put his hand on his heart and say, "The culture of our country would have been just as great without 'The Third Man', 'Kind Hearts and Coronets', 'Bridge over the River Kwai' and 'Lawrence of Arabia'"? I believe that he cannot. None of those films would have been made had the directors not been launched on their careers by a film fund when they were young unknowns full of promise, but bad box office.
Since the good old days of the "Lavender Hill Mob" and "Passport to Pimlico" the British feature film has lost much of its identity. Only occasionally does it now resurface—as "Chariots of Fire" or "A Private Function". Surely those films are as important to our visual culture as John Piper's stained glass windows or even Turner's paintings. The Government have a patriotic duty to ensure the continued excellence of the British feature film, and they should do that by television levy.
9.41 p.m.
Lord Willis: My Lords, I am not a believer in astrology and I very seldom read my chart in the stars. However, this morning I did happen to glance at mine and it said something like this: "This is the perfect time to prove that you have a remarkable sense of the ridiculous about certain setbacks or losses. Also you are aware that a new and more advantageous agreement can be made". It is in that spirit that I approach this particular debate: I hope that a new and more advantageous Bill will arise out of your Lordships' discussions tonight and in Committee.
Much of the general ground has already been covered by the debate that the noble Lord, Lord Lloyd of Hampstead, initiated a few weeks ago. Therefore, like other noble Lords, I do not want to go over the ground again but simply to underline one or two basic points. The Bill as it stands is rather like the debates in your Lordships' House: good in parts. The Bill is particularly notable for its recognition of the importance of the British film industry. But in my view—and I support the other noble Lords who have said this—it falls lamentably short of translating the recognition of that importance into practical and realistic terms.
There seems to me to be two basic flaws in the Bill as it stands. First, it really does take insufficient account of the precarious position of British films—they live, as it were, on a knife-edge. As I said in the ealier debate, I have been a screen writer for almost 40 years and during that period I have seen our industry stagger from one crisis to another. I posed this question, and I pose it again because it is fundamental, Why, over the years, has it been possible for us to develop what is recognised as some of the finest talent

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in the world—directors, technicians, writers, and actors—yet we have been quite unable to build a stable film industry?
I do not want to repeat at length the answer which I gave to that question. But the truth is that the British film industry for the last 40 or 50 years has been, in the main, a virtual prisoner of Hollywood. I want to stress, as I did then, that I am not in any way anti-American and that I admire very much what products the great Hollywood dream factory gives us from time to time. However, the truth is that, in their own self-interest, the American film moguls have no wish to see a truly independent film industry in Britain. They know that that would represent unwelcome competition as regards the making of English language films. So for the past 60 years or more they have followed a policy of keeping British films out of their cinemas while flooding the British market with their own product. We have become a virtual colony.
Do not let the Government kid themselves about an odd "Ghandi" or "The Killing Fields" or the odd Oscar that might come to a British film. Most of the Oscar winners have not had full distribution in the States and will not get it; and those that have had it, rarely return a significant profit. There are too many middle men in the middle nibbling at the cake. There is no getting away from these facts. We have not been able to penetrate the American market and over the years we have failed in one attempt after another.
Over the years, in an attempt to give the British film industry a fighting chance, a number of measures have been introduced. We have had the Eady Fund, the British quota system, the National Film Finance Corporation, the British Film Institute and—until the last Budget—certain capital allowances. However, now, at a stroke, the Government are proposing to abolish these or to place some of them in private hands. Most of the measures and organisations which have helped British films to survive—if only precariously—are to go and not enough is being offered in their place. It is as if the Government were to tear down Westminster Bridge and replace it by chucking a couple of ropes over the river. That is what we are replacing these measures with.
I do not mourn the passing of the so-called Eady levy. A small fraction of it found its way to British producers and some was used to support organisations such as the Film School and the Film Development Fund. But the bulk of the money was paid to American film companies. Bond films, financed by American money, but made in our studios, sometimes took £¾· million out of the Eady Fund in a year. The Americans seized the opportunity to make films in our studios with our talent, and then described the films as British made for purposes of the Eady Fund; over the year millions of pounds was exported from the fund to America. It did some good, but it was an imperfect instrument and therefore I do not mourn its passing.
Apart from the abolition of the Eady Fund, I can see little logic and less sense in some of the other proposals. We shall of course go into greater detail in Committee. However, as some other noble Lords have said, it seems to me that the Government have signally failed to recognise the true nature of the film industry and its problems. You simply cannot apply ordinary
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commercial standards and criteria to film-making; much as we would like to, it is impossible. It is a high-risk investment and almost every film-making country, except Britain, recognises this fact. Many of them have devised special schemes of tax relief in order to attract private investment in films.
Here I must take issue with the noble Viscount, Lord Mersey, about Australia. It was the tax relief that gave the much needed boost to Australian film production. I was present at various meetings of investors called by film producers and I saw these investors actually produce their cheques to make the films possible. At that time they were given 150 per cent. relief; it has now gone down to 125 per cent., or 130 per cent. But those special tax relief systems really did give Australia the boost it needed. And that is a nation of only 14 million people, but it has developed an industry which, as all your Lordships will know, has won the respect and admiration of the world.
It is in this direction that I hope the Government may change course. Investment is the key. We need a a certain amount of money in the middle through the son of NFFC, as it is called, to promote training and so forth. We need much more than the Government are prepared to offer at the moment. But even that will not get the film industry on its feet. What we really need is some attractive form of investment for the City and other financiers which will give them the return. That is the only way we shall do it. If it costs £15 million or £20 million to make a "Gandhi"—and it took Sir Richard Attenborough 20 years to go round the world peddling "Gandhi" in order raise the money—I would not expect any Government to put up £20 million to make a movie; I would expect the Government to put up £20 million for training, film development and script development—in other words, the risk money at the very beginning. After that, if films are to be made, we must give business the incentives. Those incentives have been taken away and in so doing we have dealt the British film industry a mortal blow. Not all the measures in this Bill will save it.
The noble Earl, Lord Winchilsea and Nottingham, together with the noble Viscount, Lord Mersey, have argued that we should have a small levy each time the BBC and the ITV show a feature film. I am sorry to have to part company with them and perhaps with some of my noble friends on this issue, but I find little attraction in the idea of taking from Peter in order to pay Paul.
The ITV companies and the BBC already make substantial investments in British films. Indeed, it has been said tonight that without those investments very little would be done in the way of British film-making. Channel 4 alone will make almost 100 feature films by 1987 at a cost of about £100 million, and that will provide work for actors, writers, technicians, and so on. Whether those films are shown in the cinema or on television is quite immaterial, because the borderline between the two is closing all the time. The fact is that they are subsidising the making of films, and this is in addition to the other grants that they make to such organisations as the British Film Institute and the National Film School.
It has been argued that the BBC and ITV companies combine together unfairly in the purchase of films;

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that they keep the price artificially low. The films that are quoted when there is talk in those terms are the small films which have run their course; films which have had a fair lease of life or are not of the top quality. But they have had to pay, and they still have to pay, enormous sums for blockbusters. The BBC had to pay out millions to get the rights of "Gone with the Wind". You may say that they should not have done so, but they did; and to get the rights of any up-to-date film today you are in a sellers' market and you have to pay a very good price.
In any case, it can be argued: who sell the films to the BBC and the ITV companies? It is the producers. They sell them because they want to make money. I do not know whether the BBC and ITV companies combine in this way, but I hope they do. I certainly would not blame them if they did, if only because by doing so they help to curb the voracious appetites of the American producers. If the BBC and the ITV go to Hollywood to buy movies to show on our screens and compete against each other on the prices, it would be absolute madness. Therefore, I do not see any great sin in what they are doing.
No, my Lords, my strong feeling is that the answer lies not in some special fund, not by a new tax on television, but by tax concessions which will encourage the private investor to put up the large sums which are needed. I would certainly favour, and agree with the noble Earl. Lord Winchilsea and Nottingham, that there should be some kind of levy on recorded and pre-recorded cassettes, and even on blank cassettes, with the money being used to compensate film producers and to put money into a film production fund, but not only in that way. We have to remember that there is a queue of copyright owners, such as authors and others, musicians and so forth, all of whom would be entitled to some part of the money. I think that that would be a reasonable proposition, that one should have a levy on the tapes.
In addition, the Government must give greater support, rather like the French Government support their film industry, as has been said, to the tune of about £75 million each year. I would not expect that kind of sum: but if we could keep to the 1979 level of support which came from Eady and other sources, that would give us the start money, the risk money, which the industry needs. In comparision with that, what the Government offer in this Bill is really piffling.
The British film industry is not asking for the moon. We do not want any special favours. We want merely to be recognised as an important cultural and commercial arm of Britain. We want to be given a small part of the support which other Governments extend to their film producers. We need this to survive. We need this so that we shall not be swamped by overseas products, and so that the unique cultural nature of our best indigenous films may be maintained.
There are many good things in this Bill, but they do not go far enough; and, above all, the amount of central government funding is inadequate. Tax incentives for the main, big investors, and more money from central government, and you will have a film industry which will surprise the world.
9.54 p.m.
Lord Birkett: My Lords, so much has been said tonight, and so many good arguments put forward, and so much of it has been said in unison, that I shall try not to keep your Lordships long. I cannot let the debate go by without remarking on what a really desolate prospect this Bill raises. I am irresistibly reminded of somebody who, piece by piece, has taken apart a delicate and complex mechanism, and who finds himself without the skill or energy to put it back together again. From this Bill the film industry seems to me really to be in pieces.
Of course, we all recognise that a degree of bureaucracy will vanish with it, and we shall all be happy for that reason. We shall all be glad to see that the British Film Institute has been remembered and not forgotten, and that its good work will in some way continue. We are equally happy for that reason about the film school; but when it comes to the major central issue of the film industry as such, one can see little comfort at all. Indeed there is only one thing left to it. The CFC is to go, the Eady levy is to be abolished, the NFFC is to be abolished, a great rack of things are to disappear and in their place one looks for some kind of central system of support. Dozens of countries all over the world can provide examples. Unfortunately, all the examples are different. Every nation has invented its own complicated system of prizes, subsidies, returns of tax concessions and levies. There are 101 ways to do it. But every country that has a flourishing and a civilised film industry has done it.
We are faced with this new son of NFFC. I have been practising saying "BSFC" to see whether it came trippingly off the tongue—cannot say it does, more work yet and it might, but at the moment I cannot say that it flows easily. It certainly does not flow easily in the way of money because as everybody has pointed out (I will not weary your Lordships by repeating it yet again) £3 million per year spread over anything up to 10 films is not enough, particularly if one considers the suggestion that that funding represents between 25 and 30 per cent. of the fund of each film which automatically restricts each film to under £1 million. There is no reason why we cannot make, even in this day and age, a good film for under £1 million. But an awful lot of good films need more than £1 million. I think it is unduly restrictive to expect the industry to go forward on a £3 million per year 10-film programme. I simply do not believe it. Everybody has pointed out that more money is needed and most people in your Lordships' House tonight have pointed out that the best way—I know that there are exceptions as the noble Lord, Lord Willis, has just dissented from that—would seem to be a levy on televisions films.
I will not weary your Lordships by going on at length about the reasons for it because they have been advanced. However, perhaps I may be allowed to add something to what the noble Earl, Lord Winchilsea and Nottingham, said about the economics of films on television. He rightly said that at the lower end of the market a feature film will be bought for television for between £6,000 and £7,000, which is a very low figure. What is interesting is that the average price of an hour of drama made by and for television is about £100,000 on ITV, and slightly less on BBC. That is the average

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figure for an hour of entertainment. So one can see that the purchase of a feature film lasting an hour and a half for between £6,000 and £7,000 gives an extremely good deal. After all, you are getting drama. It is not a documentary, education or quiz show. Therefore what you are paying for your hour and what you ought to be paying for your hour are so far apart that I cannot believe that a levy, albeit a modest one, on films shown on TV would not be the ideal way of funding this new corporation to the tune which it surely needs.
As the noble Lord, Lord McIntosh said, there may be a dozen different ways of working out how one calculates that levy and on what basis. I am not an expert and will put forward absolutely no suggestion about it except that that seems to me to be the way to do it. At the moment what the Bill presents is not so much a support for a flourishing film industry as a requiem for it.
10 p.m.
Lord Briginshaw: My Lords, I must immediately join with my noble friend Lord Willis in saying that investment is the key to the whole problem. This Bill before your Lordships and this discussion on the Second Reading, taken together with positive representations from all sides of the film industry with unprecedented unanimity, are impressive beyond measure. The issues are closely argued in the most positive fashion; support is emphasised for the continuation of financial partnership between Government and the industry. It has been a cornerstone of the training policy of successive Governments via the National Film and Television School; but concern is expressed that the Government may not get the relationship properly worked out in order to maintain the educational independence of the school, to secure for it the proper level of funding, and to guarantee its future funding against the changes of ownership in the private sector.
We are aware that the school not only is responsible for training students in its full-time programme but also has the responsibility for the national short course training programme which, among other things, is helping to retrain a generation of free-lance film technicians to work with new generations of electronic technology. Without this retraining, the industry's efficiency and productivity will be seriously impaired. Since the film production workforce is largely self-employed, it is only through a national initiative that the required retraining can be provided. Any of the proposals for a redistribution levy which are being put forward or might be introduced must therefore reserve an adequate allocation for training and retraining.
As an industry there is concern that in the absence of such a levy the training provision will be seriously diminished and the industry will consequently be severely weakened. There is a lack of a cultural element, previously mentioned by noble Lords. It is believed that a fundamental omission from the Bill is an acknowledgement of film culture as a record of the changing face of society. This would be achieved through the proper funding of the British Film Institute Production Board, the workshops and the regional art associations. These three elements are now essential to innovation and development in British
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film. Film, just like theatre and music, must retain an arena for experiment close to but not part of the commercial cinema and separate from training in the narrow sense.
The Films Bill contains no provision, as I see it, for any of the foregoing. Unity in diversity, if I may say so, my Lords, is expressed with a reflection that we ought to get that culture. We should not underrate it in any circumstances because it is everywhere in our country. I am sure that the utilisation of this will be to our general advantage.
10.4 p.m.
Lord Auckland: My Lords, I hope that my noble friend the Minister and the House will forbear with me if, due to public transport being what it is and my not living in London, I have to leave before the debate concludes. I hope that that will not be necessary. Any Government which is faced in the mid-1980s with promoting a Films Bill is probably on a hiding to nothing because, whatever legislation is brought forward, somebody is going to be displeased.
Of course, in regard to this particular Bill the television lobby has been criticised, I think rightly. Mention has been made of the number of films shown on television over the Christmas period. I made a count and I think the figure was 85 films in four days. One has the ludicrous situation of two television channels, and sometimes three, showing films at the same time. I shudder to think what the outcome would be if we had cable television.
A number of noble Lords who have taken part in this debate work in the film industry in various capacities; I am not one of them. I speak as a consumer, though I must say, as I said in the recent debate on the White Paper which was initiated by the noble Lord, Lord Lloyd of Hampstead, that nowadays, since in my part of Surrey there are no cinemas in Epsom, Leatherhead, nor Dorking, I have to rely very much either on our local Thorndike Theatre, which occasionally shows films, or on seeing them on the television screen. I do not object to films being shown on the television screen, but I believe that this is an industry which needs more recognition than it sometimes gets.
Looking at this question from a financial point of view, one can quite see the dilemma which faces any Government at the present time. All Government departments are begging for more public finance—for the arts, social services, roads, overseas development and so on—and whichever Government happen to be in power they are faced with criticisms from some quarter if they disburse too much or too little public money. But our cinema industry has had a distinguished record and it is a sad commentary that there is, as I understand it, only one full-time film studio operating in this country at present. This is the Pinewood Studios, which has, I think, an entirely British team of technicians. It is a feature films studio, perhaps I should say—
Lord Willis: My Lords, will the noble Lord give way? Films are made at Elstree and Shepperton, and I think there is a studio still operating at Twickenham.
Lord Auckland: My Lords, I am grateful to the noble Lord, Lord Willis, for that information. I was of course talking about main feature films; but the noble Lord has much more experience of the film industry than I or indeed many other people in your Lordships' House. I in fact visited Pinewood Studios with two of my noble friends the other day, and I have been there on previous occasions, too. I think a tribute should be paid to the people who work in those studios, particularly the technicians, and those in the carpenters' shop and elsewhere. They are the people who are really the hub of the industry, and it would be a crying shame if the cinema industry were to deteriorate still further. What then would be the future of these people? To some extent, this Bill makes the best of a rather poor job. It does not completely decimate the industry but it seems to the layman like myself to pick about.
Mention has been made of private funding of the industry. This happens in the visual arts, particularly music. Symphony orchestras are funded partly by the Arts Council and partly by commercial concerns. If commercial concerns did not fund them, many would not survive, despite the fact that under the present Government, even though the funding of the arts may not be adequate, it is higher than at any other time. But of course one has to make allowances for inflation. So any government are faced with a dilemma as to how the film industry should be funded publicly as opposed to being funded by private consortia. What we have to avoid is any further drain of British talent leaving the cinema industry and going elsewhere. We shall have a Committee stage on this Bill when we can go into the more technical details. Inevitably, this debate has ranged far and wide over the film industry; but the Bill itself poses more questions than it tends to answer.
10.11 p.m.
Lord Graham of Edmonton: My Lords, for the purpose of this Bill, as I have done on previous film debates, I declare an interest in an association with the Association of Cinematograph, Television and Allied Technicians. The House could not be other than impressed by the breadth of experience that has been brought to this Second Reading of a very important Bill. The Minister must be aware that, regardless of the friendship that we might show towards him personally, the Bill itself is virtually friendless all around the House. That does not mean to say that we are unanimous in our feelings towards the different parts of the Bill. Members have said that there are parts of it that are good and parts of it that they do not like, while various noble Lords have indicated some changes which they would support and some which they would not. So noble Lords are certainly not unanimous about what they want. But I think the Minister can take it that it would not be an overstatement to say that there is a hostile reception to the Bill.
The Minister must understand that one of the achievements of the Government has been to bring together disparate interests in the film industry to a remarkable degree. The National Film and Television School, the Directors' Guild of Great Britain, the British Film and Television Producers' Association,
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the British Film Institute, the Association of Independent Producers and the Association of Cinematograph, Television and Allied Technicians have combined their common interest and concern for the future of the film industry. They do not have a fancy title. They have not decided to call themselves something that might be dramatic or provocative. They have simply got together, because they recognise that if this Bill proceeds as the Government intend it to proceed there will be grave consequences for the future of the film industry.
I do not talk about disaster or catastrophe, because many of the people I have met and learned to know and respect are resourceful and will be survivors. However, I hope that the Minister will recognise that we are giving him tonight, with his ministerial colleagues, the opportunity to reflect seriously before going much further. The Minister must know that in a Committee in the other place the three senior officers of the Conservative media group combined with Members of more than one party on the Opposition Benches to demonstrate that they were prepared to say to the Government: Think again. Reference has been made, sadly, to the history of a useful amendment—it may not have been the answer—which Members of the Conservative Party, who I would certainly respect as knowing more than many others, felt should be made.
The Minister needs to take on board the fact that there is no party animus in what those who have spoken want—I see that he nods his head; I am grateful, and I acknowledge that—but the Minister either has advice which is contrary to the advice which those like myself are given by people whose views on the future of the industry we respect, or, alternatively, there is an imperative which Members here will certainly not accept. It has been categorised as walking away from the problem or allowing people to do one or two things that we do not like.
I think the Minister should listen carefully to the words of his political friend Mr. Roger Gale, who in Committee in another place said, in effect, that what he was after in the amendment that was successfully carried in Committee but rejected by the Government on Report was,
"founded on two fundamental Conservative principles".
That is what he believed. The first principle he talked about was that people should be prepared to pay a fair price for what they get. In this instance, it was the television companies. The other principle was that it was a move towards the ending of restrictive practices. That is how he saw the amendment that was so important.
The Minister has opportunities to see whether it is not possible to accept one of the amendments that will be moved in Committee or perhaps come forward with something that may well satisfy a wide range of opinion. The Minister smiles and asks me to understand his difficulties and problems, which I do, but if we are to be in the business of improving the Bill by dividing the House, quite clearly that may be the only alternative. But that is not the only way in which we can make progress.
Noble Lords have very effectively demonstrated their deep knowledge and understanding of the history

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of the film industry in this country, and, of course, I cannot possibly improve on what I have heard. I am always deeply impressed. I certainly want the Minister to take on board the powerful case made from experience by the noble Lord, Lord Willis. The noble Lord asked the Minister to look seriously at whether he could not say helpful things and deliver them by way of fiscal incentives; at whether the industry will be improved by the levy; and at whether it will be improved by persuading British investors that it is worth investing their money in British films, which at the moment it is not.
The ACTT and others have demonstrated by their contacts in the City the amount of money that needs to be funded centrally before they are prepared to put in their own money. It is all sensible and logical, and, as my noble friend Lord McIntosh said, even from the point of view of business acumen the question is whether we have a Government of businessmen who understand business when they put together a package which so patently is out of accord with the times.
Reference has been made by the noble Earl, Lord Winchilsea and Nottingham, to another means whereby some central funding could be provided—by a levy on video and audio tapes. A reference was also made by the noble Lord, Lord Lloyd. In his absence—and we understand his need to leave—may I say that I think he made a very impressive case for better funding for the National Film and Television School. As to how that is to be done, and whether we have to think in terms of amendments—that may or may not be the right way—we shall have to wait until Committee stage to see.
What in fact we need at this time from the Government are perception and courage. I do not doubt their courage if we can get the perception right. We believe that they have the wrong perception. Outside of any party animus, I genuinely believe that there are the means of getting the British people to realise that the film industry, by comparison with a great many others, including the television industry, has not had a fair crack of the whip.
We heard statistics on the cost of producing films and producing drama for television. The noble Lord, Lord Birkett, gave the cost of producing drama as £100,000 per hour, whereas a film might be purchased for the equivalent of only £6,000 or £7,000 per hour. That contrast is quite ridiculous. At the end of the day we want to give our British film industry something that it does not have now—a feeling that the Government do care. It is not that the film industry feels unwanted—just that the Government do not care enough about its problems.
Indeed, the film industry believes that it has evidence to prove that in the past few years the Government have actually taken steps which have damaged its ability to survive in the future. I hope very much that the Minister will be able to say—and I and other noble Lords will be pressing him on this—that as from tonight there must be a will to lift the film industry out of the doldrums in which, for a variety of reasons, it now finds itself. We want to see the British film industry elevated to what we consider to be its proper place. Its proper place is as a trail blazer for British craft, for British art, for national flair, for
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British genius—and in helping British culture. We want to maintain our British film industry for British workers. At Committee stage we shall try to help the Minister do just that.
10.21 p.m.
The Viscount of Falkland: My Lords, I thank the noble Lord, Lord Graham of Edmonton, for coming up with the word I have been seeking; that word is "perception". Ever since our debate last December I have tried to find a word that is charitable and understanding in describing how it was that the Government's line on the British film industry came about. I believe the noble Lord was absolutely right when he said that it was due to a lack of perception. Even taking into account the White Paper and the distinguished persons who were consulted and who were acknowledged in that White Paper, the lack of perception there is very clear. That lack of perception is not something that has suddenly come forth from this Government; it has perhaps endured for a great length of time.
What has now happened is that which the noble Lord, Lord Birkett, described so brilliantly as a dismantling of a delicate instrument. In fact, it has not been possible to put it together again. The situation as it obtains in Britian at the moment is far from bright. As to the changing fortunes to which the noble Lord the Minister referred, I understand his thinking on this. He mentioned British films which have received some acclaim; the old stand-bys are "Gandhi" and "Chariots of Fire". But they are fairly exceptional examples. The truth of the matter is that our cinema audiences have been declining; they have been in a downward spiral since the 1950s. This has resulted in a situation that is not common. Indeed, we are unique in the way that our film industry is suffering.
One thinks of America. The noble Lord, Lord Willis, mentioned that we are often associated with the American film industry. Possibly one of the misconceptions which lies behind the thinking on our own film industry dates from the 1930s, when the film "The Private Life of Henry VIII", which was an enormous success, gave rise to the conventional wisdom that we could produce films which would be profitable from their American returns. That has never, ever been repeated.
In the United States, the situation as regards the film industry—and when I talk about the film industry, I mean the exhibition of films in traditional film theatres—has been maintained at a very steady level for about 20 years. On the figures available last year, the number of cinema theatres in the United States was something under 20,000 screens, which is an enormous number, when one considers also the extent of television in the United States. In the United Kingdom, the number is now just over 700. It may even have decreased since the last figures were available. That is a reduction from about 4,500 to 5,000 in the 1950s.
One of the central causes for the failure of our industry has been the dilapidation at the exhibition end; the inability of the exhibitors to provide the kind of environment in which the public can comfortably see films. A healthy film industry requires a healthy

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exhibition end; and that is not a healthy exhibition end on the small screen. It is a healthy exhibition end in the cinema theatres.
That is something which has been realised in other countries very close to us in Europe. The nettle has been grasped in France, Belgium, Switzerland and Germany. It is important to maintain the exhibition end. It would be invidious to make comparisons, and we do not have the time. However, France is probably a good example to give. It is a misconception that the French are more temperamentally suited to the medium of cinema than we are. I think that the figures which have come out for audiences watching films on television show that we are as enthusiastic about feature films as anybody in Europe or the United States; yet we, for reasons of lack of innovation and of imagination, which have resulted in—as, I am afraid, is common in our country—lack of investment, have experienced a steady deterioration and lack of willingness on the part of the British film-going public to go into cinemas.
There are cinemas in London, Manchester and Glasgow which are comparatively comfortable. That is where most of the cinema-going public goes, but I do not know whether any of your Lordships have attempted to take members of your families to cinemas in the provinces. I still have young members in my family, and I tend occasionally to take them to cinemas in the provinces. I must say that one gets a better standard of comfort in a bus shelter! Certainly nobody can be blamed for wanting to stay at home and watch a film in the comfort of his own home. Of course, the remarks that have been made by noble Lords about the cheap rate at which the television companies get films is absolutely right. But this is not central to the problem. We must improve the whole environment of our film industry.
Apart from the misconception about our ability to earn in the United States, there is another very central and important factor which has to be understood. It has been mentioned by several noble Lords here. It is the curious and very British lack of trust of anything which has the words "culture" or "art" attached to it. The great Frenchman, André Malraux, gave his definition of cinema as the perfect example of art and industry. In other countries of the world, including the United States, there has been a successful balancing of these two factors—art and industry.
The noble Lord the Minister mentioned, with some emphasis, commercial cinema. This is something which worries me. I do not like this dichotomy; this idea that we have on one side commercial cinema and on the other side we have something slightly airy-fairy, something slightly pseudo, which is the cultural end. This is probably another reason which has caused the lack of interest in the cinema. Probably the only organisations which have been able to do anything about this balancing of the commercial and the artistic have been the following. One is the very organisation which is now being dismantled, the National Film Finance Corporation. It did this through its revenue from the Eady levy, and so on. Nobody would criticise the Government for getting rid of the Eady levy because there is not enough exhibition to have that.
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However, the replacement of the National Film Finance Corporation by another body seems to me to be totally irrelevant.
The other body in this country which has attempted it is the British Film Institute. It has attempted it very successfully. This has probably been appreciated only by film buffs and people in the film industry. The British Film Institute, on a very slender budget which it receives from funding resources here and from voluntary sources, has managed to produce in this country a network, mainly centred on London, with its National Film Theatre, and so on. It has managed to spill out into the provinces and has, as an adjunct to that, a network of film workshop activity. Such activity, if we look to the future, is an important function, an important contribution to the film industry because it is at this cultural level where our seed corn (to use a popular expression) of talent, technical and creative, will come.
I have not yet quite understood what these "shorts" are which have been included in the Bill. The noble Lord the Minister may explain this or it may become clear at Committee stage. I do not understand why it should be found necessary that new talent should cut its teeth on these 35 minute shorts. Having had a fairly mis-spent youth, I have probably been to cinemas in more countries than most. But I have never been tempted to see a 35 minute film unless it has been a special subject such as an educational film. Perhaps the Minister will enlighten us. I am curious to know what a 35 minute short is. However, I wonder what the up-and-coming film directors, the up-and-coming film technicians, and so on, will think about cutting their teeth on a 35 minute short. I am curious about that. I should say that the whole lack of perception on this Bill, which we have discussed, has probably actually benefited us. That is because one of the benefits of this is that we have all got together, since December, with interests.
I have not talked to anybody in the film or in the television industry who has thought that this Bill is good or relevant. I think that we have been able to concentrate our minds on this lack of perception, and that something good will come of it. I am of an optimistic nature. I am quite sure that even if this Bill should go through in the form in which it is and result in the complete collapse of the film industry as we know it—which I think is likely if we do not amend the Bill—we will then be forced to look, as other countries have done, particularly other countries in Europe, at ways of resuscitating our film industry. Time is now getting on. I think the useful work will be done at Committee stage.
Before I wind up, I should like to say that if we are at some stage going to look at other parts of Europe, we ought to look at France. France had had similar problems to our own. In the 'sixties they had falling audiences and dilapidated exhibition centres. They found that the television was drawing people away. They took active steps, with Government support, using, through its agency, a redistributive mechanism—which is the accepted way of doing it—to create a rejuvenated film industry. There were problems, but a levy similar to our Eady levy, although its application was somewhat different, was operated. A tax of 14 per cent. before VAT was collected from

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exhibitors. In 1983, this was placed in a rolling cinema support fund, known as the fonds de soutien, which in that year totalled well over £50 million. Seventy-seven per cent. of that fund came from contributions and a further 8 per cent. from television, with a 15 per cent. top-up from the state. The money was collected and administered by a Government-sponsored agency. Another important factor—to be considered, I suggest, in any future reform of our film industry—is that the money went back into production, distribution and exhibition. It went right across the board. There was no concentration simply on production, leaving exhibition to fend for itself.
This process rejuvenated the French film industry to the extent that there has been an eightfold increase in the number of people buying cinema tickets. There were some problems. As always happens, unless you have a regulatory body in films the big boys tend to get the biggest piece of the cake. It was the original thought of Monsieur Jacques Gajos to create the agency for regional cinema development in France. This body, with very little Government subsidy, enabled small cinemas to obtain big films quickly. That has never happened in this country. It has enabled small cinemas in regional areas in France to buy prints from the agency, which had them printed at its expense. This has revitalised interest in films in areas of France that had not been well served. Over the last 18 months there has been a remarkable renewal of interest, with cinema audiences increasing by four to five million.
I agree with the noble Lord, Lord Willis. I liked his illustration of tearing down Westminster Bridge and throwing ropes across. I hope that the united front shown by the film industry at all levels, and indeed displayed by your Lordships' House, means that the noble Lord the Minister will heed the remarks that have been made. I am sure that he will be sympathetic to the new vision that we have been able to create, and will see that a wider understanding is perhaps necessary in order to put this business really on its feet. We should not be fooled by one or two successes, one or two Oscar nominations and so on. Unless we are careful, as the noble Lord, Lord Willis, has said—he said it more forcibly in our debate in December—any money that we put into the new operation will somehow get back to the Americans, who are very jealous of their English language film industry, and it will not benefit our industry at all.
It is a balance of culture and commerce: a matter of taking a completely new look at serving an interest that is not dead. People want to go to the cinema. It is a pleasant place to visit, and they can see good films quickly and in comfort. We shall have a flourishing film industry.
10.40 p.m.
Lord Lucas of Chilworth: My Lords, I do not take quite the same view as the noble Lord, Lord Graham, took in his opening remarks, because I have not regarded this evening as at all hostile; I have found it extremely interesting. But I have to say that some five hours ago I heard a number of noble Lords talking about another industry precariously balanced between survival and extinction. That is what I have heard
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again tonight. The one common theme between the earlier debate and this one was that noble Lords asked, in a variety of different ways, for more money—more taxpayers' money.
Frankly, that rather saddened me, because I do not think that is the right way of going about things. Money does not grow on trees; it has to come from the taxpayer. It is the Government's general view that we have to provide the right kind of environment in which people have a free choice as to how they spend their net disposable income. We have, through taxation, reduced quite markedly over the last two years the imposition on the corporate sector, and there is another year of that plan to go; so there are more monies available for various industries without its all going in tax, and it would be quite wrong to reverse that trend by taking more money away from the taxpayer by increasing taxes to meet the demands not only of this industry but of other industries.
I shall enter very much into the spirit of this evening's debate because I have found it interesting. I want to assure noble Lords that I will take away and think about many of the ideas that have been put up, and discuss them with my colleagues. I am grateful to the noble Lord, Lord McIntosh of Haringey, for identifying some of the areas in which he suggested he might be seeking to amend the Bill. He agreed that the innovation, the commercial risk, inherent in this industry was not something which was necessarily a role for the public sector but was better undertaken in the private sector, with safeguards. I believe that we have introduced in this Bill the safeguards for which he calls.
The noble Lord, Lord Birkett, said that we were quite wrong on the dismantling of the existing framework of the industry and had been clumsy in restructuring it. I do not agree, because we have provided a good restructuring and we have provided continuity in the form of the new consortium. It has among its members highly reputable people. I am sure that no noble Lord would suggest that the existing members were going to do anything other than that which they have agreed to do, and do it in an honourable and wholehearted fashion. They are putting up some very good money. In fact, the continuity is such that, certainly for five years, there will be more money available to the industry. Of course, it cannot be anywhere near the £18 million which the noble Lord, Lord McIntosh, spoke of as the 1958–66 Eady levy contribution. It would be ridiculous if I ever suggested that we were going to match that kind of figure in an industry which has changed so remarkably since that time, as I tried to make clear in my opening remarks.
We think that the private sector successor to the NFFC is a good arrangement. We believe that, as it gets under way—and a lot of progress has been made in the last few weeks other members of the industry will join that consortium; and, in turn, that will generate more money. I take very much to heart what the noble Lord, Lord Briginshaw, and others, have said.
The noble Lord, Lord Willis, in particular spoke about reviewing the general tax system; perhaps the term "tax regime" would be a better way to put it. He was really suggesting—as I think was the noble Lord,

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Lord Briginshaw—that the real answer was investment. Investment in an industry such as this, which is so highly speculative and is a big risk business, must come from the private sector. It is not the Government's function to risk taxpayers' money in this kind of area.
My noble friend Lord Mersey made a number of interesting remarks. However, with respect, I think that my noble friend was wrong in his suggestion that people are especially keen to see feature films when they watch television. Investigation has indicated that the percentage of television screen time taken up by feature films is only about 10 per cent., and that percentage is steadily falling; that is, apart, of course from the festival periods. In fact, in most weeks of the year very many more people watch the serials, the soap operas and sport than watch any feature films that are shown on television.
My noble friend Lord Auckland spoke about videos. I have a number of figures, but perhaps it would be better if we left that analysis for another day. However, the situation is not quite as my noble friend suggests.
I should like to refer to one point that was made by the noble Lord, Lord McIntosh of Haringey. The noble Lord spoke about the European Directive concerned with what made up a film. I have some sympathy with the noble Lord's view that the Commission really has to take steps to ensure that other member states—not just the United Kingdom—comply with the Directives on the freedom of establishment and labour. I can assure your Lordships that the Government will continue to press the Commission on this matter. Of course, to decide now to put the clock back some 15 years and to re-erect the barrier against other member states would be a pointless and futile exercise. Sooner or later—probably sooner—we would be taken to the European Court of Justice and charged with being inconsistent with the fundamental rights of the establishment and the freedom to provide services. I am sure that the noble Lord would not like us to fall into that trap.
I should like to say a few words about the very interesting contribution made by the noble Lord, Lord Lloyd of Hampstead. During the course of his remarks he spoke about the security of funding of the National Film and Television School. Of course I recognise—as do your Lordships—that he has a particular interest, and it is a very valuable interest. We do not believe that there is any reason to doubt the bona fides of the film and television interests which have agreed to fund the school for the next five years. Moreover, their contributions to the school will be in addition to their existing payments. Therefore, I think that there is a good deal of goodwill in that direction.
Perhaps I may quickly reiterate the main objectives of the Bill. The overriding concern is with the commercial film industry. I do not think that this evening is perhaps the right time to debate what the noble Viscount, Lord Falkland, described as the airy-fairy end of the film-making business. However, as I speak in commercial terms as distinct from cultural terms, it may be that the noble Viscount was suggesting that it was I who thought that the cultural
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end was airy-fairy. I do not. I am talking about the bread and butter end of the market, rather than the educational and specialist market which, in my vocabulary style, more neatly falls into culture. However, contrary to what the Lord, Lord McIntosh, suggested, let no one be under any misunderstanding that the Government have no care for the culture of our society. Of course, we have. Indeed, the grants which my noble friend Lord Gowrie makes from the budget of the Office of Arts and Libraries to that part of the film industry, although perhaps not as large as many people would like, ought to demonstrate the Government's feelings in that area.
I reiterate that the main policy as set out in the Bill attacks the main problem area. We sweep away this raft of regulatory controls; we pave the way to do away with the Eady levy, which has not helped in recent years. I take the point that the noble Viscount, Lord Falkland, made in his remarks about the dilapidation of the cinema and the run-down at the exhibition end of the film industry in recent years. They say that the abolition of that levy might possibly make the difference between survival and extinction.
While I am on that point, I would agree with the noble Viscount that the exhibition industry has a very much more important role to play in the future. It must find new products; it must find a new way of marketing and selling those products. I do not suggest that, for all that they might do, they will encourage all those people who have left them to return to the cinemas, but I was interested to note that an experiment in Darlington of all places, which has a very high unemployment rate, of reducing film prices is having some encouraging results, and is of course adding to the social life of what is a deprived area.
There has been much talk about the cost of television time and the cost of making short films, long films, major films, and so on. When I was looking into the background of this Bill I was surprised to find that there is less of a problem today in securing finances and ensuring backing for a high-budget, really big film than for a low-budget, modest film. For a £10, £12, £15 or £20 million budget film with television rights and international rights involved, there is no great difficulty in raising money. It is in the other area where there is greater difficulty and this is where the proposals in the Bill set out to give assistance; I refer to the low-budget £1 or £2 million film, which does not attract risk finance quite as regularly.
Again I noticed and was encouraged that Investors in Industry had recently subscribed to or taken a financial interest in the Barkworth television film series "The Price", which has just finished. So industry outside the film industry is taking some interest.
As it has been mentioned on a number of occasions during our debate, I think I should say something about the levy principle. I hope that no one will take it amiss if I say that arguments that have been advanced tonight for a new levy are not entirely novel. We received similar representations during the course of the review of film policy and they were summarised in the While Paper in paragraph 5. We summarised the Government's response to those representations. It may not go amiss if I reiterate them.

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First, the White Paper makes the point that we do not believe that statutory recycling mechanisms are an efficient way of encouraging an economic activity that should essentially be orientated towards the market—a market which, as we have heard, is expanding in a number of areas through a number of outlets. Secondly, the argument that the original Eady system was efficient by virtue of the fact that it rewarded success cannot be used to promote arrangements for siphoning off returns from commercially successful productions in order that films can be made which would otherwise not attract market finance.
We also stated in the White Paper that we did not believe that the Government should intervene by introducing a television film levy which would increase the costs of the BBC, with consequent implications for the television licence fee; nor did we think that it would be right to increase the costs of the ITV companies, either. It is claimed that a levy on films shown on television would be an important corrective mechanism, for underlying that proposition is a belief that the BBC and ITV pay too little for the films they show. I do not know on what basis that statement is made. I believe that the film makers are big enough boys to negotiate and deal with the so-called duopoly.
I am rather intrigued that one does not hear the football industry complaining about the price they receive. A deal is struck between the football interests and the television interests. Nobody has actually said, "Let us have a levy per viewer of football". Therefore, I think that the industry could well look after itself there. I am not persuaded, and the Government are not persuaded, that we need an artificial recycling mechanism in statute in a market which, despite all the limitations, is nonetheless pretty capable of operating without that distortion.
I do not want to keep the House any later. We have had an interesting debate. I shall look forward to the Committee stage. I have no doubt that many of the points raised this evening will be discussed, and I know that those amendments which we may see in a week or two will be constructive. In conclusion, I believe that the Bill as it stands sets a rather better framework within which the commercial film industry can tackle and overcome the problems confronting it. I believe that the Government have provided an amount of money which will secure continuity, and which will give the industry that element of faith that it so rightly deserves. I hope that in the course of our further consideration we shall not be confronted with demands for further taxpayers' money to support an industry rich in inventive genius, in skills, in talent, and indeed in culture. I hope that your Lordships will give this Bill a Second Reading tonight.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Town and Country Planning (Compensation)Bill
10.58 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment (The Earl of Avon): My Lords, I beg to move that this Bill be now read a second time.
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It is the last of the four Second Reading debates today. I am sure that we shall have a useful discussion despite the late hour. I am told that variety is the spice of life, and as President Reagan said last night, "My goodness! she is a difficult act to follow".
The law relating to town and country planning is often regarded as a complicated and rather dull subject, mainly of interest to those whose business is the development of the land. In fact, planning law affects all of us, and proposals for the development of land can arouse considerable passions at a local or even as your Lordships know from the recent debate on the proposed third London airport—at a national level. One of the more obscure by-ways of planning law relates to compensation: this too can occasionally give rise to situations which create public anxiety and concern. When this happens, it is the Government's task to look at the way in which the law is working, and to take any necessary corrective action.
Normally compensation is not paid for the refusal of the planning permission that is required before land can be developed. The local planning authority can consider the proposal in the light of all the relevant factors, and balance the interests of the developer and of the wider community, without having to ask itself whether it can afford to refuse the application, if this is the right thing to do. But in May 1983, in the case of Camden London Borough v Peaktop Properties (Hampstead) Ltd, the Court of Appeal decided that compensation would be payable in certain circumstances for the refusal of an application to build an additional storey onto an existing block of flats.
To explain this decision, I need to refer to the provisions of Section 169 and Schedule 8 of the Town and Country Planning Act 1971. There are equivalent provisions in Scottish planning legislation. Section 169 provides that, if certain types of applications are refused or granted subject to conditions (there has to be an appeal to the Secretary of State first) and this has an adverse effect on the value of the land, compensation is payable. The types of development to which Section 169 applies are set out in Part II of Schedule 8, and they include the enlargement by up to 10 per cent. of a building which was in existence on 1st July 1948. That is the appointed day for the Town and Country Planning Act 1947 which was the foundation of current planning law. In the Peaktop Properties case, the local planning authority argued that the right to compensation did not arise when the proposed extension involved the creation of new self-contained flats; but the Court of Appeal rejected this interpretation of the statutory provisions.
I will not bore the House with a detailed historical account of the origins of these provisions. The clue is to be found in the heading of Schedule 8, which reads "Development not Constituting New Development". When the 1947 Act introduced modern planning control, it was considered that some classes of development ought to be regarded as part of the existing use of the land, and that the landowner ought not to lose entirely his right to carry them out. It followed that, if permission for such development did have to be refused under the new planning system, compensation should be paid. Indeed, in most of these cases, a planning application no longer has to be made because they are covered by the provisions of the

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general development order, about which I shall be speaking in a moment. However, extensions to flats are not covered by the GDO, and the refusal of permission for a 10 per cent. extension of a block of flats in existence on 1st July 1984 still creates a potential compensation liability, as the Peaktop Properties case demonstrates.
It could be argued that the provisions of Section 169 and Schedule 8 date back to an era when planning controls were still something new, and that they represent a transitional arrangement which was needed at the time, but has now served its purpose. That is not the case that I am putting forward. We recognise that the right to compensation under these provisions is capable of affecting property values, and should not be taken away without very good reason. But in the case of penthouse flat extensions we believe that there is clear evidence that these compensation rights are being abused.
A report prepared by a group of residents associations suggests that before 1983 there were on average three or four penthouse flat applications each year. In 1983, the year of the Peaktop decision, there were 12. Last year there were 21, and information coming from correspondence and press reports suggests that the increase has been continuing. It is suggested that this is because economic factors are now favourable to such extensions, and I am willing to accept that this is part of the explanation. But it is not the whole story.
Twelve months ago, there was a widely publicised seminar entitled "Section 169 Town and Country Planning Act 1971—A Cascade of Gold for every Building Owner". The brochure referred to
"Great possibilities for compensation for the owners of buildings which existed in 1947".
There were sessions on "the pre-requisites for a successful claim for compensation" and "How to secure compensation". In short, the whole purpose was to encourage the making of applications which did not relate to genuine proposals for extensions, but which were intended to be refused so that they could provide the basis for a substantial claim for compensation.
My Lords, is it surprising that the number of applications have been rising in the last 12 months? Moreover, the worse the application is in planning terms, the more harm it does to the appearance of the block; the more it overcrowds an already densely populated area, the more it adds to the problems of street parking, the greater the chance that the planning authority will be forced to refuse it despite the financial consequences. It may be said that this is a problem limited to a few central London boroughs. But, even if this is so, the residents associations' report to which I have already referred suggests that there are over 2,000 privately-owned blocks of 10 or more flats built before 1984 in Inner London, and that the potential total compensation bill could be of the order of £60 million. I do not believe that the House can allow an abuse of this magnitude to continue.
As I have made clear, our case for amending Section 169 rests on the way in which the provisions relating to penthouse flats are being abused, rather than on any
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argument that the provisions are obsolete. Two consequences follows. First, the action that we are taking needs to have immediate effect. We cannot allow time for a flood of speculative applications to be made while the Bill is going through Parliament, so that, by the time it has been enacted, most of the damage has already been done. We have therefore provided for the amendment to Section 169 to operate from the date when the Bill was introduced—an unusual provision, but one that is certainly not unprecedented, particularly in fiscal legislation.
Secondly, the Bill has been narrowly drafted, so that the amendment to Section 169 is limited to the specific situation highlighted by the Peaktop Properties case. Indeed, it has been suggested that the Bill has been too narrowly drafted on this point, and that it needs to cover other types of extensions of blocks of flats which involve increasing the cubic content of individual flats by more than 10 per cent., but without any increase in the total number of units. We are considering this point, and we may well need to return to it at Committee stage. But we do not consider that we should go wider than this. It might be possible, for example, to abuse the provisions of Section 169 in relation to office extensions. If such abuses arise, we shall need to deal with them. But it is no light matter to take away compensation rights in this way. We consider that we should do so only where there is clear evidence that they are being abused in a particular way.
I now turn to the other half of this Bill, and to the provisions relating to Section 165 of the 1971 Act. When a landowner wishes to develop his land he will often need to apply to the local planning authority for permission to do so; but not always. He may find that permisssion for this type of development has already been given in a development order, made by the Secretary of State under Section 24 of the 1971 Act. I have already made a passing reference to the Town and Country Planning General Development Order 1977, commonly referred to as GDO, which grants permission for no less than 23 classes of development, including a good number of those which appear in Schedule 8, which range from the erection of gates, walls and fences and minor house extensions to quite significant extensions to industrial premises. A development order is a statutory instrument, and Parliament controls the use of this power through the negative resolution procedures.
Like any other statutory instrument, a development order can be revoked or amended. Section 165 provides that where, first, planning permission for the development of land has been granted by a development order; secondly, that permission is subsequently withdrawn by the revocation or amendment of the order; and, thirdly, an application for planning permission for the same development is then refused or granted subject to conditions, then, on those three cases compensation is payable to the applicant for losses which are directly attributable to what has happened.
The reasoning behind this provision is perfectly sound. The landowner may already have incurred expenditure in reliance on the GDO permission. He might have begun to draw up plans and buy materials, or he might even have reached the stage of letting a

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contract. If he is then stopped halfway through, it is reasonable that his direct losses should be reimbursed. Unfortunately, Section 165 at present goes much wider than this. It contains no reference to any time limit; so it does not matter when the development order was revoked or modified. A landowner may be able to obtain compensation for the refusal of a planning application simply because, many years previously, development of that type was permitted under the GDO. The fact that he had no intention of using the GDO right when it was available—and, indeed, may not even have owned that land at that time—will not debar his claim.
Until recently there was little concern about the operation of Section 165, mainly because the General Development Order had rarely been amended in a restrictive manner. In 1983, however, we removed development likely to involve the presence of a notifiable quantity of a hazardous substance from the permitted classes. Local planning authorities, while welcoming the additional power to control such development, were concerned about the potential compensation liability if applications had to be refused or conditions had to be imposed. We have no reason to believe that industrialists have abused these provisions; indeed, it would hardly be in their own interests to do so. Nevertheless, we ought to take the opportunity to correct the defect in the legislation. The Bill therefore provides that the provisions of Section 165 will apply only when the application for planning permission is made within 12 months of the revocation or amendment of the development order (or, in the case of past revocation or amendments, within 12 months of Royal Assent). After that period, the compensation liability will cease.
Why 12 months? Our intention is to limit compensation to real out-of-pocket losses and to exclude notional reductions in land values. If a person has begun to incur expenditure on a development scheme permitted under the GDO, and the order is amended, it seems to us that 12 months provides adequate time for a planning application to be submitted. If an application cannot be submitted within 12 months, this suggests that the landowner had not begun work on his scheme before the order was amended, and has not therefore suffered any out-of-pocket losses justifying compensation. It is a rough and ready test, but we have quite simply been unable to find any better way of achieving the same objective.
It has been suggested that a 12-month period is too short for certain kinds of development involving a long lead time. It should be remembered, however, that development order rights are not taken away out of the blue: almost invariably there is a period of consultation, which alerts landowners who may be affected to what may happen. If there are cases where this is still insufficient, any necessary further advance warning can be achieved by deferring the operative date of the GDO amendment. The hazardous development amendment, for example, did not come into operation until six months after it was laid, for precisely this reason. We believe that it is preferable to handle each amendment according to its particular needs rather than making an across-the-board increase in the one-year period, so increasing the scope for abuse in the case of those relatively minor types of
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development for which a planning application can be worked up quite quickly.
I would not claim that this is a simple Bill, although it does have the merit of being short. The provisions relating to Section 165 of the 1971 Act and its Scottish counterpart are designed to cure a defect: those relating to Section 169 are aimed at stopping up a very limited abuse. I commend the Bill to your Lordships. I beg to move.
Moved, That the Bill be now read a second time—(The Earl of Avon.)
11.14 p.m.
Lord Lloyd of Kilgerran: My Lords, in rising to support the Second Reading of this Bill may I first of all congratulate the Minister on the clear and careful way in which he has presented this short, complicated and technical Bill. It is a Bill having serious financial implications, and, as the Minister has said, is mainly directed to removing the heavy financial liabilities for local planning authorities, involving perhaps millions of pounds, arising largely from the Peaktop Properties case. That case, of course, was in relation to the development of large blocks of flats that had been built prior to 1948. I therefore accept, as stated by the Minister and in the other place, that there is clear evidence that there has been serious abuse of the compensation provisions of the Town and Country Planning Act 1971.
However, a consideration of the financial provisions of this Bill raises problems as to what should be a fair balance between its provisions and the rights of individuals who have an interest in the property, particularly in view of the long list of developments at present permitted without the permission of local authorities or the Secretary of State under the well-known Town and Country Planning General Development Order 1977, No. 289, to which the noble Minister has referred, and which is affectionately known to practitioners as the GDO.
In view of the lateness of the hour, and as there are many experienced speakers waiting to follow, I propose only to draw attention to a few general matters where amendments to the Bill may be desirable in order to prevent hardship to certain classes of owners. The first relates to the length of the period of 12 months included in Clause 1 of the Bill as subsection (1A) of Section 165 of the Town and Country Planning Act 1971. As the Minister has described, when planning permission granted by a development order is withdrawn a further application must be made within 12 months if it is to qualify for compensation. For certain industries, such as the farming industry and developing small businesses, this period is far too short.
I do not propose at this late hour to go into details to substantiate this, but I would point out that the pattern of farming practices may change quite rapidly these days. Dairy farming is being given up, as your Lordships have heard, with sheep farming being substituted; and, as I know from my own experience in relation to farming in Wales, horses are then bred instead of sheep. Therefore, a period of 12 months, in the circumstances in which small farmers in particular

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find themselves, could be damaging. Again, I shall not elaborate the point, but the pattern of business arrangements of small firms may also change, and, again, this period is too short.
My present view is that, so far as farming and certain small businesses are concerned, three years would be more reasonable when dealing with developments permitted under Class VI of Schedule 1 to the GDO. That class is entitled "Agricultural buildings, works and uses". I also submit that a much longer period should be adopted in dealing with parts of another class, Class VIII, which is entitled "Development for industrial purposes". I am also advised that some flexibility in regard to the period concerned should be given in relation to some developments under Class III, which relates to changes of use and particularly applies to shop premises; and also under Class IV, which is entitled "Temporary buildings", particularly in connection with farming and small businesses.
I come to the second amendment proposed, set out in Clause 1(2). These amendments, as the Minister has clearly indicated, are specifically directed to developments of blocks of flats in relation to which there has most certainly been abuse. The problem arises from the wording to be found on page 2, where, in relation to the definition of a building subparagraph (a) states that this applies where,
"the building contains two or more separate dwellings divided horizontally from each other or from some other part of the building"—
and sub-paragraph (b) reads:
"the enlargement would result in an increase in the number of such dwellings contained in the building".
Now if I may be personal for a moment, I have a particular instance in mind of a school on the Isle of Wight where we have in about 70 acres a complex of buildings comprising art galleries with boys' dormitories, to which are attached a house master's house and another dwelling. Two dwellings are attached to this complex. We have in mind to build another dwelling to house a house master or research persons in relation to the contents of the art galleries. It may be therefore that that kind of development would be caught under the words of the Bill. The school concerned has charitable status, and it seems to me that this is not the kind of building to which dwellings have been added that is contemplated under this Bill. I suggest therefore that the word "contains" in line 3, page 2 of the Bill, might be more suitably modified by having substituted for it the word "comprises". However, that is a matter for the Committee stage. I may be wrong in the example that I have been given and perhaps the problem does not really arise. Other difficulties may arise under this proposed amendment in relation to charitable and historic buildings, but I see that the noble Lord, Lord Montagu of Beaulieu, is to follow me and so I shall desist from pursuing that argument further.
The long delay by the Government in bringing forward this legislation is somewhat extraordinary, having regard to the notice they have had of the potential abuses of the compensation clauses of the Act of 1971. I therefore crave that fact in aid in saying that no peremptory action should be taken to defeat the rights of legitimate owners of lands who wish to
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develop their activities and have difficulties in complying with the year period. However, there are other points on which, if it were not so late, I could have elaborated, but I do not propose to detain the House any longer in regard to this Bill. I support the Second Reading.
11.23 p.m.
Lord Montagu of Beaulieu: My Lords, this is a Bill that clearly must command support from all parties. It deals with two glaring anachronisms in present legislation, and closes the door on a distasteful piece of exploitation. I strongly support the Bill, but speak tonight representing the views of the Historic Buildings and Monuments Commission and therefore must declare an interest.
Before commenting in detail on the Bill, I think that I speak for the whole heritage world tonight when I say how delighted they were to have heard the announcement by the noble Earl this afternoon that the Government have decided to place at the disposal of the National Heritage Memorial Fund no less than £25 million to ensure the long-term future of Kedleston, Weston and the Chippendale furniture at Nostell Priory. It certainly nails the lie that the Government are not prepared to support the heritage.
Our view is that the Bill does not go far enough. Brevity is a fine thing and this Bill has all the merits of being short and succinct. But in confining itself so rigorously to two specific anachronisms it fails to deal with the problems that these two sections—Sections 165 and 169 of the 1971 Act—cause to the heritage. I must explain shortly why I think the Government need to widen its scope. I was delighted to hear from the noble Earl that perhaps amendments will be sympathetically received at Committee stage.
The architectural heritage is important to us all. It consists not just in single buildings of great intrinsic value and interest, but in groups of buildings which may individually be of minor interest but which, taken as a whole, make up the familiar and beautiful local scene. Legislation therefore permits and encourages local authorities to designate what are known as conservation areas; those of architectural and historic interest whose character and appearance ought to be preserved. This was a brilliant conception; the intention being to enable groups of buildings to be preserved without applying the full rigour of statutory listing to each and every building individually. The commission fully supports this concept, not only with its mouth but also with its purse; we are spending around £7 million a year on grants to buildings and conservation areas, with the active support of local authorities.
However, some of those same areas are now at risk from Sections 165 and 169. They are at risk because—understandably, I fear—local planning authorities are loath to reject a planning application if rejection would give rise to a claim for compensation. Thus, bad planning decisions have been taken, and will continue to be taken, simply to avoid the likelihood of compensation. I argue, therefore, that the Bill in its present limited form wastes a first class opportunity for protecting the heritage. It tackles important issues, but does not go far enough.

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I now turn to Section 169. My noble friend has already explained the circumstances in which compensation can be claimed. One of the main qualifying factors is that the building must have been in existence in 1948—and I am sure your Lordships will agree that this test is one that historic buildings invariably satisfy. Then the proposed development must require planning permission. In city centres many rear or side extensions within the 10 per cent. tolerance will be within two metres of a boundary wall and therefore will need permission; or the building may be used, not as a residence but as, say, offices or shops, in which case a planning application must be made. In all these circumstances refusal of consent can give rise to a claim for compensation.
I shall give some examples. The Bill before us excludes from compensation a roof extension, if the building is used as flats and if the extension will be used as an additional and separate flat: good. But what if the building is used as offices and the new top floor will add extra office space? A roof excrescence is no less unsightly because a particular house is used as offices rather than as flats. It is the building and not just the way it is used that concerns me and my colleagues in the Historic Buildings and Monuments Commission.
Take the case of pairs of villas standing close to the street, but with gaps between; "critical gaps" is, I believe, the planning term. Through them is a view of gardens, probably trees, and possibly a uniform brick boundary wall at the rear. If the gaps are filled with garages and side extensions, those views will be lost. If planning permission is refused, compensation may be payable. It, in a uniform street, compensation is paid to one owner, then the chances are that, inevitably, all the other owners will rush in their applications in the expectation of receiving a similarly lucrative refusal.
I say "lucrative refusal" advisedly, because in London compensation can be very heavy. It is all a question of land values. In other parts of the country the cost of the proposed building work may usually equal, or even exceed, the increased value of the property, but not in London. Here even refusal of consent for hard-standing for cars in front gardens could lead to substantial claims. With current interest in Section 169 we can expect more and more applications to be followed by claims for compensation.
I ask your Lordships to consider what the progressive loss of front gardens would do to pleasant eighteenth and nineteenth century streets. How will local objectors understand that, even when there seems to be a cast iron case against a planning proposal, permission is still given? I hope your Lordships agree that it is not enough to amend Section 169 only in the limited way now proposed. This section poses a real threat to the integrity of conservation areas within our historic cities. To amend it without removing liability for compensation in respect of listed buildings and conservation areas would be to tackle only half the problem.
However, under Section 165 as it stands, the local authority is liable to pay compensation in respect of losses directly attributable to imposition of the Article 4 direction. In short, it can make a direction, but, if as a result, it decides to forbid unsuitable alterations in the conservation area, it may face a claim for
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compensation. I refer there, of course, to GDOs, about which there has been a lot of talk already.
My noble friend has explained the Government's view that in the case of amendments to a development order, compensation should still be payable within a year of a change, but not afterwards. Pari passu, exactly the same arguments should apply to Article 4 directions. I ask your Lordships to agree that a longstanding Article 4 should be treated in the same way as a long-standing change in a development order. I understand that there may be some effect on agricultural land, and I listened with interest to what the noble Lord. Lord Lloyd, said.
In short, I welcome this Bill, but regret that it does not go far enough. Two sections of the 1971 Act are to be amended in a limited way that fails to deal with difficulties for the heritage. I think that it is a wasted opportunity. Frankly, I can see no merit in such a blinkered approach. I am confident that at Committee stage all parties will unite either to support a Government amendment or another amendment to take account of the points that I have made.
11.31 p.m.
Lord Sandford: My Lords, I welcome the Bill and I am grateful to my noble friend the Minister for explaining its genesis and origin. It is right to respond to abuses such as the Peaktop case with appropriate legislation once they have been revealed, but it is always a mistake to legislate on the basis of a particular abuse or a particular incident. It is much wiser to look at the whole code of compensation in this case. I am grateful to my noble friend for the indications which he gave earlier this week that that is what the Government now intend to do and for the assurance that he gave in his speech that they will indeed do so when we reach the Committee stage, either by way of further amendments to this Bill or assurance that the matters such as those which my noble friend Lord Montagu has just raised will be taken care of in the planning (miscellaneous) legislation which will follow shortly after.
All that I want to do at this late stage in the proceedings is to mention three aspects which I personally would want to see attended to at the Committee stage and which I know that the Association of District Councils is keen to see tackled. The association deals with all the development control in England and Wales outside the conurbations. I do not now want to say anything more about the urban aspect—the conservation areas—because my noble friend Lord Montagu has said all that needs to be said on that. Perhaps tonight, though, my noble friend Lord Avon might confirm that, in dealing with the point of my noble friend Lord Montagu, we shall be dealing with the situation in Scotland as well. The Bill is clearly drafted with Scotland in mind, and I take it that anything we can do for conservation areas in England and Wales will cover Scotland, too.
I should like to pursue again, but very briefly, the reference to the countryside made by the noble Lord, Lord Lloyd, a moment or two ago. I recall recommending, when I was reviewing the national parks 12 years ago, that the landscape area special development

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orders should apply in all 10 parks and not just two. We have made some progress in that recently the Ministry of Agriculture has been claiming credit for having withdrawn its opposition to that extension, so that now, after 12 years, we are in a position shortly to be applying that order in the other 10 national parks. From examples that I have seen of rural abuses of this compensation period, it is clear that that extension needs to be taken further into the areas of outstanding natural beauty. I do not want my noble friend to reply to that point tonight, but I should like to give him notice that it is something that we shall want to pursue and discuss at the next stage.
The third and last point which I should like my noble friend just to take notice of tonight is the need for the liability to pay compensation, when it arises, to fall in the right quarter; that is to say, when it arises from changes in national policy, leading to adjustments of the general development order, the compensation should be met by central Government funds. But when it arises as a result of an Article 4 direction, say by a local planning authority, then of course it should fall on the local authority. We want to have that distinction clear. We also want to establish the fact that when compensation comes to be paid by the local planning authority that expenditure does not count against their financial targets. Those are the points which I think need further attention at Committee stage.
11.36 p.m.
Viscount Craigavon: My Lords, I, too, certainly support this Bill. I was going to make a fairly long speech encouraging the noble Lord down a road which he has already in his speech indicated he is exploring. I take his assurances in that regard. It is the area of Section 169 and the 10 per cent. relating to residential property, as well as the addition to Clause 1(2) to restrict the expansion of individual flats. If the noble Lord could produce an amendment on this point, I should be extremely grateful, as would the Royal Borough of Kensington and Chelsea, which is prompting me and, I believe, the noble Lord, too.
I hope that the noble Lord will feel free to backdate in any small amendment that he introduces to the date of publication. That would be for the reason that he mentioned—to avoid speculative applications being made in the next few days and weeks until the Bill is passed. I am grateful to the Minister for what he proposes, but I should add that I still might produce some small amendments at Committee stage.
11.37 p.m.
Lord Coleraine: My Lords, I, too, welcome this Bill. I so much agree with what has already been said that I am able to be brief. I particularly welcome Clause 1(2) and the equivalent provisions for Scotland, which deal with the pernicious rash of applications to put whole floors of new flats on top of existing blocks. I know many people in blocks in central London who for years have been subjected to the uncertainty of not knowing whether or not their landlords, or perhaps the owners of that part of the sky immediately above their roofs, were going to succeed in their game of cat and mouse with the local authority and be given
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permission to put a whole new floor of flats on top of their blocks, with all the upsets and worries that the building works would cause. This is just one of many factors which have for years now bedevilled flat dwellers in central London, and the Government's initiative in bringing forward this Bill to resolve the problem is very much to be welcomed.
However, I wonder whether the Bill goes far enough in this respect. I have two points to make. The effect of the Bill is to be retrospective, but I should like the House to consider whether it is to be retrospective enough. Developers who have paid large sums of money for what amounts to chunks of sky with hope value have done so with the clear knowledge that if they lose their planning applications and collect compensation, they will have very satisfactorily cheated the community.
In his Second Reading speech in another place my honourable friend the Under-Secretary of State said:
"We seriously considered covering applications already in the pipeline… However, we reluctantly concluded that that would represent an unacceptable degree of retrospection, and open us to the charge of confiscatory legislation. We believe that the provisions of Clause 3 are a reasonable balance between the conflicting interests".—[Official Report, Commons, 5/2/85; col. 901.]
I should like to push this point a little further, just to see whether the door is on the latch, if not ajar. Any developer who has paid good money for air space will be retrospectively affected by this Bill. In my mind there is no particular magic about the making of a planning application, and so I do not see why a developer who has made an application should be favoured over one who has perhaps been more restrained and has not got round to making it.
I would submit that the better cut-off point in the planning chain would not be the moment at which planning permission is applied for, but the date on which, in accordance with Section 169 (1) of the Town and Country Planning Act 1971, the Secretary of State has refused the application or granted it subject to conditions. It is only on that later date that the speculator has acquired any rights to compensation. If the Bill is amended to provide for this later date to apply, Parliament will not have confiscated any actual vested right. It is true that the developer will have incurred expense, but I do not think that it will be difficult to provide that the developer should be reimbursed his direct expense in getting to the stage of having his schemes turned down by the Secretary of State.
Like the noble Viscount, Lord Craigavon, I also detected that the door is definitely ajar as regards the 10 per cent. point. I consider it very important indeed that the provisions of Clause 1(2) should relate not just to additional flats put on top of buildings, but also to increases in the size of existing flats. I would ask my noble friend whether Clause 1(2) is intended to deal also with buildings that are used not as blocks of flats but possibly as private hotels or as boarding or lodging houses. It seems to me that these types of houses should be brought within the provisions of the Bill. I have some doubt as to whether they necessarily qualify as dwellings. With that, I indicate my strong support for the Bill and wish it a good Second Reading.
11.42 p.m.
Baroness Gardner of Parkes: My Lords, I support the Bill, and have been asked to do so by the London Boroughs Association. From my own personal knowledge of living in the centre of London, I have seen these applications and these changes in the skyline as blocks of flats have acquired a new top floor. I know the problems that have been caused for local residents. Indeed, these permissions have almost always been granted on the grounds that it would be too expensive for the council to refuse them.
For some years I served on the Historic Buildings Committee of the Greater London Council. We frequently came across the problem to which the noble Lord, Lord Montagu, has referred. One house in a nice terrace of listed buildings would apply for a roof change or roof extension that could upset the whole harmony. I remember that, at that time, the officers were very reluctant to let the word get around that if the application was refused compensation could be sought. They feared that many people who had no need or who had not intended to extend their property would apply purely for the compensation. Conservation areas are particularly important. I should like to see that point taken into account.
I do not know that I agree with the noble Lord, Lord Montagu, as regards low-level rear extensions. We must bear in mind at all times that in many cases people living in the centre of London today have young families and need additional space. If the time comes when we force all our local people out of houses which end up simply as pieds-à-terre for foreigners in the middle of London, it will be a shame. There has to be a compromise point. But the Bill does not prevent the local authority or the listed building authority granting permission in a sympathetic case. The Bill is simply to deal with the financial abuse whereby people take advantage of the scheme and cash in on it.
The London Boroughs Association points out what it considers to be defects in the Bill. As I shall be abroad at the time of the Committee stage, I should like briefly to mention them. It considers that it is inequitable that compensation should be payable by a local planning authority when, at the same time, a situation could exist in which a residential property value has been enhanced by the making of a direction. The planning policy behind making directions would be nullified if, because of the risk of high compensation, the planning permission were then granted.
It believes that central London is affected very adversely, and it hopes that an amendment to the Bill will be brought forward providing a new Clause 1(2). I place this on record tonight so that the Minister will be able to think about it. It would say that no compensation claim under Section 165 may arise with regard to any development rights in respect of residential premises curtailed by the issue of a direction under a development order. That refers to Section 165. The association is also unhappy about Section 169, and thinks it does not go far enough.
Many speakers tonight have made the point that 10 per cent. of an individual flat is quite different from 10 per cent. of a total block. I think that it might be fairer—this is a personal point, my own view, and is
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not put forward by the London Boroughs Association—to have 10 per cent. of an individual flat or so many cubic feet, in the way that now applies to dwelling-houses; because 10 per cent. of some flats might be a very tiny space and not enough to improve people's living conditions.
The London Boroughs Association says that the Bill does not deal with unneighbourly development. I am very worried by the suggestion that unneighbourliness should be a big feature in planning. In the past year I have built a house in central London. It was actually a case of rebuilding, because the house disintegrated and had to be demolished and rebuilt. When I applied for planning permission, naturally my neighbours all objected. Some had good grounds and others had very spurious grounds, or very doubtful ones. This was particularly so in the case of the lady who objected on the grounds that if I had a window looking out I might see her going up and down her stairs without her clothes on, as was her constant habit. I found that a very poor reason for my not being allowed to have a window in the back of my house. I might add that that lady has now left the area.
However, a short time later, when I had my permission and my house was under way and being constructed, I received notification of developments that would be looking out on me. The man in the house behind me wanted to put in new windows looking into my garden. My instant reaction was a defensive one, in the same way as the other lady's reaction to me had been defensive. I said to my husband, "We cannot have a new window looking into our garden". My husband's reply was, "Of course we can. We are all living in such close proximity here already that if we cannot develop a tolerance for our neighbours and an acceptance that everyone has the right to a window, we are going to be just as bad as that other person was to us". We made no objection, and the window is there. The people concerned use the room a great deal and cause no bother or inconvenience at all to us.
I find the anxiety on the part of the London Boroughs Association that there should be some coverage about neighbourliness or unneighbourliness, in terms of planning and compensation, a perhaps slightly worrying concept, because neighbourliness is always something you think about if you are the person who is going to be affected adversely. No one stops to think about it on the other side. If you are the one who is wanting a little extra living space to enable your family to remain in a much-loved home, your attitude is quite different.
I should like to bring in another point on this issue. I know areas in central London where lovely listed squares can be affected adversely by changes in their roof line because those squares were built before the 1948 date. Near them, modern houses built after that date—say, in 1950, or up to 1960—do not have the right as a permitted development (I think this is correct) to carry out the same changes in their building. It seems to me that there are at the moment a lot of anomalies between listed buildings and newer buildings, and perhaps there will be an opportunity to look at those.

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I have mentioned the fact that I should like a certain size, and that is certainly something about which the London Boroughs Association is most concerned. That association wants the limitation set at 10 per cent., of a particular flat. As a personal addition, I would add "or a certain dimension, whichever is the more suitable". However, we must realise that this Bill does not in any way prevent a local authority from granting planning permission; it is simply a financial measure to ensure that people do not cash in on existing provisions.
11.50 p.m.
Lord Graham of Edmonton: My Lords, I join in the general welcome that has been given by everyone to the useful measure that is before us. Certainly there will be no opposition from these Benches to the Second Reading of this Bill. This is one of those occasions when I would certainly want to express my appreciation to the Minister present this evening and to his ministerial colleagues. I have in mind, in particular, Mr. Neil Macfarlane in another place. I, like all noble Lords when matters are debated in another place before they come here, read the Hansard of the other place. I have spoken to my colleague Mr. David Clark who handles these matters there, and he has shown me correpondence that has taken place since the Committee stage in that place. I want the Minister to understand how deeply I appreciate the care and concern of his ministerial colleague Mr. Neil Macfarlane who quite clearly is very sympathetic to the general concern that has given rise to the amendments. If I am correct, I think that he referred to them in the other House as minor and technical amendments. Nevertheless, they are important and significant.
I am always impressed by the assiduousness with which local authorities draw to the attention of Members in both places matters to which I certainly had not given any thought. However, when one is told of them one appreciates that they are very important and we ought not to lose the opportunity to raise them. The Minister must take on board tonight that there are a number of people who, in genuinely seeking to protect the interests of those who they have the responsibliity to serve, see this not as the last opportunity, but as an opportunity to try to urge the Minister to make the Bill do more than it actually does.
I wish to try to avoid going over the ground and the explanations which have been excellently given by the Minister, and which have been pointed up by other colleagues here. Certainly the Minister and his colleagues were right to appreciate the significance of the Peaktop experience in 1983. Personally, I should have thought that it must have come as a shock. Nevertheless, once it happened one can immediately see the significance. The Minister has drawn attention tonight to the way in which a seminar was held, which was advertised quite frankly. People were told that, if they did not know that there was something they could get away with, they were on a winner both ways—they either got their permission, which enhanced the value, or, if they did not, they got somebody's money, be it the taxpayers' or the ratepayers' money. They had
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nothing to lose. I believe that the noble Baroness, Lady Gardner of Parkes, also pointed up this matter.
I am aware of the point concerning the London Boroughs Association, which is absolutely fair, and also the point concerning the Royal Borough of Kensington and Chelsea and the London Borough of Haringey—which is not very far away from either the noble Baroness, Lady Gardner of Parkes, or myself. They used as an illustration the correspondence of the London Boroughs Association and the correspondence of the borough of Kensington and Chelsea. They also illustrated that in the London Borough of Haringey there were some very unhappy possibilities. One of the problems is that people are referring to what is likely to happen without being able to be specific. There is a fear that the situation will snowball. The Minister gave us one or two illustrations of how it could grow and grow. Of course there could be absolute catastrophic consequences for a borough which had tried to follow the right course of action from a planning point of view. It could find itself in a dreadful situation.
One of the authorities that have been in touch with me is the AMA and in connection with Section 169 dealing with planning permission matters (one of the illustrations to which I am referring) it says:
"One London borough obtained Counsel's Opinion that liability to compensation is a material consideration in considering a planning application under Section 29 of the Town and Country Planning Act 1971 and that it is a consideration which must be weighed by the Council against any planning objections which may arise on a particular development".
The noble Baroness, Lady Gardner of Parkes, mentioned that. As an ex-chairman of a planning committee, I can see a planning officer quite properly telling the committee and the town clerk that before they decide to refuse this application they must take into account the financial consequences. That is their job. The chairmen of planning committees must be faced with a terrible dilemma if, in trying to do the right thing by the built environment they land the ratepayers with a big bill.
Perhaps I could quote in aid the areas of outstanding natural beauty. I am grateful that the noble Lord, Lord Skelmersdale, is in his place because we had a very useful exchange over the Prussa Cove/Higher Kenegie problems which arose out of the manner by which it was possible, despite an area being designated an area of outstanding natural beauty, for people to exercise their rights, or attempt to exercise their rights, and yet act contrary to the spirit of the area of outstanding natural beauty.
The case I want to cite was brought to me by Lancaster City Council. I have seen some photographs of the development here. Again, the noble Baroness, Lady Gardner of Parkes, said that we should live and let live for the sake of good neighbourliness. I have here photographs of someone's house which has had built next to it five black polythene tunnels in which mushrooms are growing. We all know how mushrooms are grown; they are kept in the dark and covered with fertiliser.
Let me briefly illustrate the dilemma facing Lancaster. In 1984 the owner made a planning application for permission to erect buildings of 15,000 square feet to produce large quantities of compost for

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use on sites elsewhere. Permission was refused. Strong local representations were made against the proposal. The county council regarded it as being contrary to structure plan policies aimed at protecting the AONB. Amenity organisations also made representations.
However, following refusal of permission, the owner commenced work on five different sites. One of these is an extension to the existing steel-framed building and is to be used for the filling of trays with compost. The remainder are for blocks of growing sheds. These are semi-circular "tunnels" of black plastic 2.5 metres high and 17 metres long, each set in blocks of five.
Then we come to implications. The Article 4 direction has been confirmed by the Secretary of State. It has the effect of requiring development which could otherwise have been undertaken as "agricultural permitted development" to be the subject of a planning application. However, any refusal of planning permission or requirements imposed through planning conditions will then potentially involve the payment to the owner of compensation by the city council. It will not have any effect upon the buildings already under construction.
The compensation to be claimed—in response to action following an Article 4 direction or a discontinuance order—may be on the basis of disturbance to the business, including loss of profits. The sum involved may therefore he quite substantial.
As an ex-chairman of a planning committee, I can see myself agonising not just over the aggravation. I believe the noble Lord, Lord Montagu, pointed out how a planning committee which decided to allow the development, because it was looking after the ratepayers' interests, would be in trouble with the general residents because it had granted planning permission. In other words, we have a series of anomalies. I fully support almost everything that has been said, particularly the remarks of the noble Lord, Lord Montagu, who made a good case about Article 4 directions. I agree with him that the Bill ought to put Article 4 directions on the same footing as changes in a development order. Where an Article 4 direction is made by a local authority, claims for compensation by owners ought to be limited to one year from the directions coming into force.
There have been a number of points made. The Minister needs to take it on board that we are happy that this Bill be given a Second Reading because it puts some things right. We shall not be party to any action which delays the passage of this Bill. We want the Bill to be passed because it puts right some anomalies. But between now and Committee stage, when amendments may be put down and debated, the Minister should think seriously, and I noted with appreciation that he indicated some amelioration that will come. When we see the words, they may be satisfactory to a large extent. But there are other matters which have been raised that the Minister ought to look at carefully to see whether it is possible to have the minimum number of amendments. I think in terms of the allusions made by Mr. Neil Macfarlane and the Minister himself; and I believe that the noble Lord, Lord Sandford, alluded to the possibility that something may be said about the prospect of including some matters in other legislation as a better
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opportunity to put right some of the things we are talking about.
Before I sit down, may I refer to the absence of my noble friend Lady Birk? As the House knows, she takes a deep interest in these matters. She is not able to be here this evening, but certainly she will be here at the Committee stage and will want to take a full part in it. We on these Benches welcome the initiative of the Minister in trying to put right (and I believe he has substantially put right) many things that are wrong. But when it comes to the question of the 10 per cent. we support its application not merely to the building of the flats but to the extension of the buildings as well. We look forward to some helpful words from the Minister now, and we want to help him to make sure that this is a better Bill when it finally leaves this House.
12.3 a.m.
The Earl of Avon: My Lords, I am grateful to all Members of the House for their generous welcome of this Bill. I assure the speakers tonight that I have no intention of keeping anybody in the dark, or, indeed, of covering anything in fertiliser! I look forward to the discussion of a number of issues at Committee stage. If tonight I find that I have not covered any particular factual points, I shall write. The noble Viscount, Lord Craigavon, in his short speech, asked whether we would look at the retrospective point. We are considering the amendment, and we shall be doing exactly that. At the moment it is in course of discussion with my colleagues to see what we can do about it. I am sympathetic to the noble Viscount's point.
The noble Lord, Lord Lloyd of Kilgerran, spoke about the landowners. The amendments to the GDOs are widely publicised, particularly in the technical press. If the landowner has a scheme in hand which is dependent on a GDO permission and the GDO is then amended to take the permission away, I find it inconceivable that the landowner will not hear about this for 12 months. If he has no intention of using his GDO rights and is ignorant of their existence, I accept that he may not learn about an amendment to a GDO quite so quickly, but in this event why should he get any compensation? He has, after all, not suffered any real loss.
On the noble Lord's more specific point about the Isle of Wight, at the moment I do not believe that any compensation will be payable under Section 169, but I shall certainly look into this again. The noble Lord asked a little about the farming industry. It is suggested that the farming industry works on a basis of five-year development plans, and would therefore be prejudiced by the 12-month cut-off period in respect of compensation under Section 165.
I should have thought that a farmer in the middle of such a plan would be able to get his planning application in within 12 months of a GDO amendment. If permission was then refused, he would retain his compensation rights. If it were granted, he would have a further five years to carry out the development. Moreover, as I pointed out in my speech, GDO amendments are not normally made out of the blue. If there is a problem, nevertheless it seems preferable to

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tackle it by giving extra notice of the GDO amendment. That is by deferring its operation date rather than by increasing the 12 month period, and opening up scope for abuse in respect of changes relating to development with a much shorter lead time.
My noble friend Lord Montagu was kind enough to give me advance notice of what he was proposing to say this evening and this enables me to give a considered reply to his points. First I should say that I fully share his concern about the architectural heritage, but there is one point that we should bear in mind at the outset. In the case of buildings which are listed as being of architectural or historical interest, any alteration to the building requires listed building consent as well as planning permission. Listed building consent can be refused without creating a compensation liability under either Section 165 or Section 169 of the 1971 Act.
I recognise that this still leaves the important question of extensions to buildings which are not themselves listed but which contribute to the character of a conservation area. My noble friend has made two requests. First, that the extension of any building in a conservation area—his specific example was a building used as offices—shall not attract compensation under Section 169. In this Bill we have to balance planning considerations with property rights. As I said in opening this debate, we have felt justified in acting against extensions to flats because the provisions of Section 169 are clearly being abused. In the case of extensions to other buildings such as offices, we have no evidence of abuse—indeed we know that the property world regard Section 169 as of considerable importance in relation to perfectly legitimate office improvement schemes. We are not dealing with outdated rights which can simply be taken away without doing any harm—we are dealing with a very specific abuse. It may be difficult to meet my noble friend on this point.
However, he also raised a point in relation to Section 165. He argued that a "long standing article 4 direction" should be treated in the same way for compensation purposes as a revocation or modification of a development order, and the 12 month time limit should be imposed. Most article 4 directions are directed against a specific development proposal which is already in hand, and in such cases the imposition of a 12 month time limit is likely to have no practical effect. But if there are long standing article 4 directions, made to give general protection to conservation areas rather than in response to a specific development proposal, then there may well be a case for doing what my noble friend suggests. We will doubtless have an opportunity to consider this further during the Committee stage.
My noble friend Lord Sandford asked if any amendment would cover Scotland. Yes it will, though that will depend on the drafting of the amendment of course. If landscape area special development orders give rise to compensation under Section 165, the 12 mnth cut off period in the Bill will apply. The third point that he raised was that compensation arises not from the amendment of the GDO but from a subsequent refusal of planning permission by the local
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planning authority. The 1971 Act provides for such compensation to be paid by the local authority and we see no justification for central Government to pick up this particular bill.
My noble friend Lord Coleraine spoke about retrospection. This is indeed a delicate arm. We think that Clause 3 gets it right. We do not at the moment have an amendment in mind. The 10 per cent. extension point I believe I have already covered in my remarks. The Bill does apply to the current abuse regarding flats, as indeed I mentioned.
I accept that some planning authorities will have rooftop flat applications already before them. Where the landowner has already done his part of submitting the application I believe that it would be wrong to take away his right to compensation retrospectively. Moreover, this could mean that authorities who had delayed giving a decision on such applications would escape a compensation liability while those who had determined such application promptly would be at risk. This, I believe, would not be right.
My noble friend Lady Gardner of Parkes put forward very strongly, I thought, the case which she said the LBA had asked her to make. On point one, I think we have discussed this already. On point two, I thought that she herself argued against it and then rather tore it up. However, on argument three, I would again agree with her totally. The noble Baroness asked about listed buildings. The refusal of listed building consent does not attract compensation.
I should like to thank the noble Lord, Lord Graham, particularly for his kind remarks about my honourable friend Mr. Neil Macfarlane. He also introduced the subject of Haringey, for which I have sympathy. He mentioned the subject of mushrooms. As I believe he will recall, we went out to consultation last year on a number of proposals for amendment to the order, including proposals to amend Clause 6 in respect of livestock buildings. We are now considering very carefully the important issues raised by the response to our consulatation paper. I am delighted to hear that the noble Baroness, Lady Birk, may be back in the fray on the Committee stage of the Bill.
Lord Graham of Edmonton: My Lords, she will be back.
The Earl of Avon: My Lords, when I say "in the fray", of course I know we are all in such harmony that I look forward to a very charming Committee stage. I think that what I can suggest to the Committee is that it is necessary here to keep a balance all the time. It is one of those occasions where we have to try to make sure that all the interests are looked after. I shall read Hansard with care and see to what extent we can help as a Government. I beg to move that this Bill be read a second time.
On Question, Bill read a seond time, and committed to a Committee of the Whole House.
House adjourned at twelve minutes past midnight.

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