Sitting of 22 February 1985

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

  University College Hospital, London (Tinnitus Clinic)
  9.35 am
  Mr. Jack Ashley: I have the honour to beg leave to present a petition concerning the tinnitus clinic at University College hospital. It is signed by Mr. Jack Shapiro and 71,025 others They express their deep anxiety about the possible closure of the clinic and the desperate need to keep it open.
  The petition reads:
  To the Honourable the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled:
  The humble petition of the British Tinnitus Association acting under the auspices of the Royal National Institute for the Deaf.
  Sheweth that the tinnitus clinic at University Clinic hospital, London WC1 is under threat of closure as a result of the withdrawal of funding by Bloomsbury district health authority.
  Wherefore your Petitioners pray that your honourable House will take such steps as may be necessary to ensure that the tinnitus clinic will remain open and so continue its diagnostic treatment and research facilities which are of benefit to tinnitus sufferers throughout the United Kingdom.
  And your Petitioners, as in duty bound, will ever pray, &c.
  To lie upon the Table.

Orders of the Day

  Copyright (Computer Software) Amendment Bill
  Order for Second Reading read.
  9.37 am
  Mr. William Powell: I beg to move, That the Bill be now read a Second time.
  It may be for the assistance of the House if I start by explaining what I propose to cover in my speech. First, I propose to set the Bill in the context of the computer software market in western Europe and in Britain as it is now and as all projections suggest that it will grow during the next five or six years. Secondly, I propose to analyse the development of Government and public policy over the past decade or so and to show why it is necessary to deal with this problem on its own without waiting for more general legislation, which I believe the Government contemplate at some stage. Thirdly, I propose to analyse some of the difficulties which exist under the law as it is believed currently to stand, there being considerable uncertainty among lawyers about exactly how the law stands. Thereafter, I wish to move on to the consequences for the industry of the present state of the law and the difficulties of enforcement. I shall then deal with the measures that the industry is taking to deal with some of its problems.
  Whatever the industry does, it will still be faced with its first and most fundamental difficulty, which is the absence of a sure copyright law in this area. I propose to analyse how this problem is being tackled by our principal trading partners and the major countries that are involved in computer programming. I then propose to analyse the Bill, concentrating on how it is proposed to enforce it. I shall deal finally with the prospects for the industry if this measure is passed.
  I begin by dealing with the size and scope of and prospects for the industry, because this sets the context in which the measure must be seen. In 1983 more than $61 billion—nearly £61 billion on the current exchange rate — was spent on data processing in western Europe. About 57 per cent. was spent on external products and services and the remainder was spent on data processing staff and overheads. The software and services segment of this market was worth more than $12 billion in 1983 and— this is the crucial point—it is expected to grow on average by no less than 22 per cent. per annum between now and 1989. By any standards, this must be one of the most dynamic sectors of our economy.
  In 1983, processing vendor services had 39 per cent. of the market, but this proportion is expected to decline by 1989 to less than 25 per cent. The composition of the market is changing. There is likely to be a rapid growth in the software sector. The software sector had a 28 per cent. share of the market in 1981 and a 38 per cent. share in 1984. On current projections, its share is expected to grow to no less than 57 per cent. by 1989.
  In 1981 the total value of sales of software in western Europe was $1·3 billion. By 1989 it is expected to grow to approximately $7 billion. That effectively means that sales will multiply 2·5 times between now and 1989. This

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  market is growing at a staggering rate. In 1983 independent suppliers of package software and custom software had 27 per cent. of the market, but this share will grow by 24 per cent.—higher than the average expected rate of growth—between now and 1989. For the small houses this projected growth in the market is little short of dramatic.
  We are dealing with a dynamic market. On a national basis, taking the western European market as a whole, France offers the best opportunities, with projected growth of 23 per cent. Projected growth in Germany is 18 per cent., in the United Kingdom 16 per cent. and in Italy 11 per cent. This point is important, because in the past Great Britain has always been assumed to be the world leader in software packaging. We are in a state of substantial decline compared with our major competitors. One of the main purposes of the Bill is to ensure that we return to our position as world leader.
  The basic legislation governing copyright is the Copyright Act 1956. Clearly the world has changed a great deal during the past 30 years. Many products that are commonplace today were unimaginable 30 years ago. From time to time, Parliament has had to extend the conditions of the Copyright Act to cover new products. For example, two years ago the legislation was extended to cover video material. My Bill seeks to extend the cover to computer software, which was barely understood 30 years ago as having any prospects.
  It was plain that the 1956 Act would have to be revised. In March 1977 the Whitford committee, led by Mr. Justice Whitford, produced a report, Cmnd. 6732, paragraph 486 of which stated:
  "The demand for clear and effective protection has increased as the programming industry has grown."
  The report went on to analyse how it has been long recognised that copyright is the most appropriate intellectual property right for the protection of computer programmes. Mr. Justice Whitford concluded in paragraph 489:
  "Having considered the issues involved we are strongly of the opinion that there is a need for clear and effective protection. Accordingly we recommend that all computer programmes and software which have involved a sufficient degree of skill and/or labour to be considered as works in the normal copyright sense and which have been reduced to writing or other material form should be clearly and effectively protected against copying."
  As a result of the report's publication, the Government started consultation on general reform of the law on copyright. I must point out that Mr. Justice Whitford's committee considered more than just the protection of computer software; it considered the updating and modernising of the law generally.
  In 1981 the Government issued a Green Paper entitled "Reform of the Law relating to Copyright, Designs and Performers' Protection", Cmnd. 8302. Paragraph 2 of chapter 8 concluded:
  "It may be questioned whether copyright is the right vehicle for the protection of programs. However, as Whitford remarked, it is probable that programs are already protected under the 1956 Act and the Government accepts that there is much to be said for dealing with programs under copyright law, since the essential need is for protection against copying. To remove any uncertainty that may exist it is proposed to make explicit in new legislation that computer programs attract protection under the same conditions as literary works. In these circumstances considerations such as term and ownership and, indeed, the basic
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  question of whether a program possesses sufficient originality to attract copyright protection will apply to programs in the same way as to other copyright works."
  The process of consultation continues.
  The Information Technology Advisory Panel, which reported in 1983, said:
  "Copyright legislation is a fundamental building block in the infrastructure of the information business. … We would stress the crucial importance of copyright legislation to future economic activity. it is essential that the (Copyright) Bill now being proposed should take account of the web of developments that have been described in the Report"—
  that is the Green Paper—
  "in order to provide a secure legal foundation for the information business to the year 2000 and beyond and we urge all interested parties to give the subject close and continuing attention."
  The Government have not been able to publish a Bill on that matter. May I explain why? It is in the fundamental interest of the industry that common standards be obtained among our trading partners. In considering the modernisation of any copyright law, it is necessary to take into account not only the developments in the United Kingdom since 1965 but to secure a common approach to the problem with our major trading partners. As I understand it, the Government have not been consulting solely with interested parties in the computer software industry and other aspects of copyright law reform, but are having to consult with our European partners to obtain, as far as is possible, a common approach to the whole problem.
  The House will be aware that many of the major firms involved in this industry are trading not just in the United Kingdom but throughout the Common Market and the rest of the world. Nothing could be more harmful to the development of the industry than to have different laws applied in different countries. Although reform is necessary, it is essential that that reform be not rushed if, as a consequence of taking the matter slowly, properly and sensibly, we can obtain much wider reform than would be possible if we were dealing within our own national context.
  I shall deal with some of the problems caused by piracy in the software industry. It is appropriate to start this part of my speech by saying that it is impossible to state with precision and complete accuracy the extent to which piracy exists in our coutry. That it is substantial is undoubted. I shall give some evidence—there is a mass of evidence for anyone who wishes to study it — that I think accurately reflects the best judgment of the dangers and weaknesses in the present law.
  The evidence begins with a survey conducted by Dr. Elsom of the University of Aston which was published in the spring of 1982. That study revealed that approximately one in four microcomputer software houses were suffering from what they regarded as a serious loss from unauthorised copying of their software by users and/or piracy by software dealers.
  In 1984, a study by Newcastle polytechnic revealed that the proportion of companies conscious that their programmes had been pirated had risen to a staggering 56 per cent. It would be a bold man who would say that one year after the publication of the Newcastle polytechnic survey that proportion had declined. It is an almost inevitable inference from the evidence that is accumulating week by week that it is growing, not declining.
  At my request, following publication and First Reading of this Bill, Dr. Elsom returned to the same sources to find out what had happened to the companies that he surveyed

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  in 1982. Whereas in 1982 25 per cent. of the microcomputer business software developers were unaware that unauthorised copying of their products was taking place, he found that 37 per cent. of the 27 companies that he had identified in his survey — 10 altogether — had gone into liquidation or were untraceable. A further company which was unable to survive on its own had been taken over. Of the remaining 16, three had become purely retailers of software and had ceased development, three companies were in the process of taking or had taken legal action against those who had been pirating their products, and another three had to confess that they were unable, although they wished to do so, to take legal action because they could not afford expensive actions in the civil courts to try to establish their title. That is a depressing follow-up from the 1982 survey.
  In the past three months a whole range of companies, from the largest to the smallest, have approached me with evidence of what has been happening to their companies. As it is fundamental to my case that software piracy is occurring in all sections of the software industry, from the highest to the lowest, from commercial and business software of the £1 million-plus scale to the smallest computer game available in any house, I shall give three examples—I believe them to be representative samples of the type of evidence that has come before me —so that the House may have some idea of how the problem is affecting individual companies. I do not propose to name the companies involved. I assure the House that they have all approached me in confidence and I am prepared, in confidence, to pass on the information which has come to me.
  The first of the three examples is a company with a turnover in the United Kingdom of approximately £10 million per year. Its managing director estimates that for every authorised copy of his software on the market there are two unauthorised copies. His company is owed £1 million by one software pirate who has been identified. The managing director estimates that the total loss of revenue from lost royalties and sales during the past nine years of that pirate's activities is more than £2 million. At the turn of the decade, 1979–80, that company was hoping to expand substantially into providing educational software. When I use that term, I stress that I am not talking about educational software which will teach children in schools and youngsters in colleges the technique of using a computer, but rather software that can become a substitute for and often a great improvement on the textbooks which are otherwise available for the teaching of academic subjects in schools.
  That company wished to move into that area, but the managing director has found that it is impossible because of the ease with which the material can be copied. He has withdrawn, and is now concentrating all his activities on operating systems software which can be protected by post-sales maintenance. When it becomes necessary to maintain the hardware involved, he can discover what software is being used and has some idea whether it has been pirated. That is a self-protection technique which more and more companies are having to use. It is thoroughly dangerous for the development of the industry because more and more of the major houses are having to turn in on themselves and to rely not just on their own hardware but on their own software. It is the familiar argument that the House is used to hearing of free trade against protection.
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  My contention is that the best opportunities and the best prospects of growth for this industry will exist if there is a free interchange of trade between hard and software and not the development of software which will be exclusive to the manufacturer's hardware where it becomes impossible to use that software on another company's hardware. That would be a very dangerous development for our industry and would ensure that we missed out entirely on the international opportunities which are currently open to us if we are able to put our own house in order.
  The company was employing fewer than 10 people at the start of the decade. The managing director had hoped by now, with the opportunities and plans that he had at the start of the decade, to be employing 100 or more people, but because of piracy he has had to curtail virtually all the growth that he intended and to restrict himself to a limited range of services in order to protect himself as closely as possible. If ever there was a case of lost opportunity, that is an example of it.
  I have been told by a second firm — a major international software company producing business programmes — that for every authorised copy of its software available in the market there are between three and eight unauthorised copies. It is an international company trading across the world. That has resulted in lost sales and royalties of more than £600 million during the past two or three years. The company believes that piracy has affected its export markets, and it is now only distributing software containing measures designed to prevent users and dealers from copying it. Thus, in the clearest possible way, piracy has had an effect on the manner in which the company develops and distributes its software. It is an appalling tale. It is a problem that extends across the world, and I shall deal with it in a moment.
  Mr. Paddy Ashdown: The hon. Gentleman has mentioned two quite large firms, particularly the second one. Does he agree that, whereas large firms may well have the resources to police the market place, and even to change direction or to feed in certain security devices, the problem is much greater for smaller firms which have no such resources, so that in their case software theft can kill them off?
  Mr. Powell: The hon. Member is correct. One of the conclusions that I ask the House to draw from my analysis is that the large firms are always able to raise the cost to the pirate of breaking the protection for the software system. Therefore, with the large firms there is an escalation of cost, between the manufacturer and the pirate, in the breaking and copying of the system. The small firms do not have the necessary resources. There has been a sharp decline in the number of houses writing their own software and commissioning software from independent agents. The evidence suggests that in 1983 there were about 500 houses dealing in that section of the market. By the end of 1984 the number had declined to about 350 as firms had gone out of business altogether and as other firms had ceased to commission outside software from independent agents. That has resulted in a decline in the number of people writing software programmes during the past 15 to 18 months. The brunt of that decline has been at the lowest end of the market. I am grateful to the hon. Gentleman for drawing the matter so clearly to the attention of the House.

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  My final example concerns another multinational software house supplying business software on microcomputers. It estimates that between 10 and 20 per cent. of its users are unauthorised. That is resulting in a loss of revenue of between 10 and 20 per cent. The company is having to invest more than £1 million per annum in alternative technological methods of protection. All of them are necessarily — at a price — vulnerable to penetration and to copying. Money is having to be spent to protect the software but no final protection is possible. All that is necessary is for the pirate to invest more to break the protection.
  A pirate is able to sell the pirated product for as little as one tenth of what the market price would be to the author of the software product, so that it becomes impossible for legitimate businesses to make any worthwhile return on their efforts. That has dampened all prospect for successful development of the market.
  One of the world's largest computer software houses, Digital Equipment Corporation — my hon. Friend the Member for Basingstoke (Mr. Hunter) hopes to say something about it in due course—has estimated that in 1983 in the United Kingdom it lost £10 million in revenue from unauthorised copying of its software through piracy. The best estimate for 1984 is that lost sales and royalties amounted to no less than £150 million. As the total size of the market for 1984 is just over £1 billion, the £150 million is consistent with my examples of between 10 and 20 per cent. loss of revenue.
  All the companies which have approached me about the problem, and also approached the organisation — the Federation Against Software Theft—which has been set up by the industry itself to tackle some of the fundamental problems of the law and organisation, have stressed the fundamental importance of copyright law in the protection of computer programmes, and the need to remove remaining uncertainty about their copyright position. There is not the slightest doubt that, even though there are many actions that the industry itself can take, none will be successful unless the law of copyright is extended so that it without doubt covers computer software.
  That is the one safeguard which, more than anything else, Parliament can give to the industry. That is why I put such importance in my analysis on the taking of that one step. If we give the software houses that opportunity, it will be in their hands to take all the other necessary steps to guarantee their survival, growth prosperity, and contribution to the national economy in the future. Then, if they fail, it will not be because we have let them down but because they have been unable to rise to the challenge of the enormous growth to which I referred at the beginning of my speech.
  The consequences flowing from the situation that I have described are lost investment and lost opportunities. At the bottom end of the market, a computer game of any merit may cost between £50,000 and £100,000 of investment to bring to the market and to sell. A computer game can be copied in 40 seconds on to a floppy disc. To get that pirated floppy disc to produce a sufficient quantity of the computer game and get it on to the market can take three to four weeks, so the manufacturer of a software game may have as short a time as three weeks in which to make a return on his investment.
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  In those circumstances, it is not surprising that very few new worthwhile games are being commissioned at present. There is no hope that any company can get a worthwhile return against such a background. I know that the House will be fully aware that only good software is copied. Nobody bothers to pirate a thoroughly inferior and worthless product that nobody would buy. It is the quality material that is most vulnerable, and inevitably it involves more investment.
  Let us suppose that any hon. Member or any member of the public listening to the debate decided that he could develop a software programme, and he went to his bank manager and said that he would have four weeks, and no more, to get a return on the investment. Is there the slightest prospect that the bank manager would be prepared to lend the money necessary for that investment? Of course not. Therefore, investment for the development of computer software programmes is drying up. That is part of the overall tragedy, with declining numbers of firms, declining outside commission with declining jobs in the industry. That is why the industry itself feels uncertain about its propects. As it stands, the law is pathetically inadequate to cope with the situation.
  Lawyers will argue among themselves whether copyright covers software. Some will say that it does, and some will say that it does not. Some will say that it might, although something else might be the case, and each case has to be dealt with on its individual merits. Prosecutions in the criminal courts are extremely rare. It has been necessary to resort to the most undesirable developments and extensions of the law to try to catch the pirates.
  In July last year, in the county of Devon, a youngster from west Yorkshire was accused of hiring out a copy of a software tape and photocopies of the manual that went with it. He was summoned before the Teignmouth magistrates' court in Devon under the Trade Descriptions Act. It had been necessary to resort to that Act to try to bring any sort of case at all against the youngster, effectively to accuse him of selling something that was not what it described itself to be because it was pirated. He was fined £40 with £50 costs.
  In no way can the Trade Descriptions Act be an effective vehicle in the criminal courts for stopping piracy. Therefore, the industry has had to resort more and more to expensive, time-consuming and often rather uncertain civil actions. The House will be aware that when a company feels that its commercial position is being undermined by piracy it is possible to apply to the court for an Anton Piller order, which will effectively stop it, pending the outcome of proceedings in the civil courts. It is fundamental to the procedure of obtaining an Anton Piller order that one moves immediately it becomes plain that one is in trouble. However, because of the difficulty for the person to prove, so accurate are the copies that are made in pirated programmes, that it is his own programme and he had the copyright to it, there is delay. Thus there are substantial risks that the court will not come to someone's assistance because he has delayed much longer than was necessary.
  However, equally, no lawyer could advise his client to proceed by the civil law unless he had 100 per cent. proof of his claim. The risk of failure is too great and the prospect of being undermined if there is a failure is so overwhelming that lawyers have had to be extremely cautious. Substantial sums of money are now being spent essentially on lawyers. I declare an interest. I am a lawyer.

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  The Bill that I am promoting is definitely against my interest as a lawyer—and so it should be. It is a scandal that money that should be used to develop the industry is being used to cushion some of the uncomfortable facts of life for lawyers in the Temple and elsewhere.
  Therefore, the prospects of successfully protecting software programmes under existing law are uncertain at best and hostile at worst. As the hon. Member for Yeovil (Mr. Ashdown) stressed, many of the smaller firms simply do not have the resources to do anything. They concede defeat even before they start because they do not have the resources. I am certain that the House will be anxious to end that situation as soon as possible.
  However, the industry is taking several important steps to protect itself, through technical protection. It is possible to build into a programme means of technical protection. It is expensive to do so and increases the cost of the product, but it raises the stakes in the battle between software houses and pirates. Certain pirates might be deterred from piracy because of the additional cost involved in breaking that protection. As I have said, the simple fact is that the large houses can raise the stakes, but that still does not represent a satisfactory administration of our law.
  Because of all those difficulties, in the summer of last year the industry came together to form its own body, the Federation Against Software Theft, with the avowed purpose of focusing on the inadequacy of the law, particularly the copyright law, and to bring to the public's attention what was happening and to try to sway public opinion so that people began to realise that piracy was theft and was doing considerable damage to industry, employment, investment and jobs for the future.
  I should like to use this opportunity to pay tribute to the way in which FAST has carried out its activities in the past year. We in the House are all used to lobbyists. We are all used to mail and literature raining upon us, which is unwelcome. We need large wastepaper baskets to accommodate all that descends upon us. If ever there was an example of a successful, persuasive body carrying out its duties and objectives in the most professional and successful way, FAST is it. I pay particular tribute to the chairman of FAST, Mr. Donald Maclean, who has done so much to bring us to the point of discussing this subject almost at the first reasonable opportunity that the House could have had.
  Very early on Mr. Maclean was able to persuade my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell) to introduce a Bill under the ten minutes rule on 25 July last year, which for the first time in the House focused on the industry's problem. That Bill was not consigned, like so many such Bills, to the wastepaper basket after a short airing of the grievance that it raised but became the springboard of a sustained campaign, within the House and without, for a change of the law. I am delighted to say that, before my hon. and learned Friend introduced his Bill, my right hon. Friend the Member for Mole Valley (Mr. Baker), then the Minister for Information Technology, had written to Mr. Maclean of FAST, saying:
  "I warmly welcome the setting up of the Federation Against Software Theft. The software industry is a very important, and quickly growing sector of the British economy. It is already a major contributor to national wealth and employment in this country, and it is essential that it should be in a position to protect itself unlawful copying. I am very pleased to see that the industry is organising itself to counter in a concerted way the threat of
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  software theft, and I would like to assure the new Federation Against Software Theft of my support and encouragement for their valuable efforts in this area."
  My right hon. Friend the Member for Mole Valley was as good as his word and so has been his successor. My hon. Friend the Minister for Information Technology and the Under-Secretary of State for Trade and Industry have been of invaluable and fundamental assistance to our efforts to secure a change in the law. Without their help none of this would have been possible. Equally, it would not have been possible if both sides of the House were not convinced that a change in the law is necessary.
  I am delighted to be able to pay the most fulsome tribute possible to the hon. Members for Dagenham (Mr. Gould), for Motherwell, South (Dr. Bray) and for Yeovil who are here today, and for Stockton, South (Mr. Wrigglesworth), all of whom represent parties different from my own. Without their assistance and advice, none of this would have been possible. All are entitled to their share of the thanks which I know the industry would wish to extend for the assistance which it has received.
  It is interesting that what is occurring in Britain has been occurring in other countries. We are not alone. We are not acting in isolation in seeking a reform of the copyright law. We are parallel with some countries, and slightly behind or slightly ahead of others. The United States, through federal legislation in 1980, extended the copyright law to cover computer software. Various state legislatures in the United States are considering specific anti-piracy laws for their jurisdictions. Louisiana was the first state to pass a distinctive anti-piracy measure for computer software.
  In 1984 the Australian Parliament passed what is virtually emergency legislation because a judgment given at first instance appeared to suggest that copyright did not subsist in computer software and it was necessary to reverse that. The Canadian Parliament is considering a change in the law almost identical to the one which we are now considering.
  The House will be alert to the fact that the examples that I have given so far have been common law jurisdictions. In Europe the Roman-Dutch law jurisdictions of the Common Market do not think of copyright in the same way as we do. They do not have such a sophisticated view of copyright. To them, copyright must be seen as part of a wider legal pattern involving concepts of unfair trading, which we do not have as finely developed as they do. Their legal analysis is frequently different from our own, which creates some of the difficulties to which I alluded earlier in my call for a common response throughout the Community to these problems. It is no good wishing that they were not there because they are.
  Throughout the Community, it has been necessary for courts of first and sometimes appellate status to extend copyright by case law to cover computer software. In country after country, bodies such as FAST have been formed in order to try to protect the industry and to seek a change in the law. Only last week such a body was set up in Italy. There is already such a body in Holland, and moves are afoot in France, Germany and throughout the Community parallel to those here. Not only in North America, the Commonwealth and the Common Market, but in countries of the orient, courts of first jurisdiction are beginning to extend the law of copyright so that it covers their particular problem.

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  What we are doing is no more and no less than what has taken place and is and will be taking place in other countries. Therefore, although we may not take action at the same moment as other countries, we shall soon find ourselves with broadly parallel laws, which will be to Britain's immense advantage.
  I have said that my hon. and learned Friend the Member for Mid-Bedfordshire introduced a Bill under the ten minutes rule. As one would expect from its origins, that Bill was most professionally drafted. Hon. Members frequently claim that the legislation that comes before the House is indigestible and incomprehensible because it alludes to earlier statutes into which we have to substitute words which we cannot find and which, if we can, we then find are virtually incomprehensible.
  I know that my hon. and learned Friend will not regard what I am about to say as disrespectful. Since his introduction of a Bill under the ten minutes rule the matter has been reconsidered. Assistance has been given by my hon. Friend the Minister for Information Technology and the Under-Secretary of State and the Bill has been drafted with the assistance of parliamentary counsel. Those gentlemen are frequently the object of substantial criticism for producing incomprehensible legislation. For once, if only for once, they have produced a triumph of clarity and brevity. Nothing could be easier than the Bill. Clause 1(1) provides:
  "The Copyright Act 1956 shall apply in relation to a computer program (including one made before the commencement of this Act) as it applies in relation to a literary work and shall so apply whether or not copyright would subsist in that program apart from this Act."
  I hope that for once the House will join me in praise of the parliamentary counsel who have managed to produce it.
  Mr. Nicholas Lyell: I am most grateful to my hon. Friend for drawing attention to that point. Might it have something to do with the fact that the Statute Law Society gave a prize for the redrafting of a Bill which was won by someone who redrafted the Copyright Act 1956? If that is so, does he not welcome the beneficial results?
  Mr. Powell: My hon. and learned Friend is right. If ever there were a pilot scheme which should lead to a much wider scale of opportunities and prizes, surely that was it.
  Clauses 2 and 3 bring into effect the provisions of the Copyright Act 1956 for computer software programmes. It will be possible to apply to magistrates for a search warrant—a crucial power of law enforcement. In that I am following the scheme which was adopted two years ago by my noble Friend Lord Eden of Winton in his private Member's Bill which extended the law of copyright to cover video programmes.
  The scheme of things under the Bill is identical to that in the legislation passed two years ago. That Act has been one of the most successful ever passed in modern times. The industry faced colossal problems and action was taken perhaps later than it should have been so that the problems were aggravated, but it is estimated that the legislation has eliminated two thirds of illicit and unlawful piracy. Given the ease of copying, much will inevitably never be stopped. The Bill is not designed to prevent copying for personal use at home, although I hope that people will be
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  alerted to the moral implications of copying other people's property, but it is designed to make life as difficult as possible for those who pirate and copy works and then sell them at a fraction of the true cost.
  Mr. John Powley: As my hon. Friend has said, technical development in the computer software industry is moving very rapidly. I understand that the Bill will cover the pirating of existing software, but will it cover developments in methods of which we are now unaware but which may occur in the technological progress of the next few years?
  Mr. Powell: I am grateful for that intervention. All the advice that I have received is that the Bill will be sufficient for that purpose, but I believe that the Government will be introducing further copyright legislation in due course so that if the Bill proves inadequate in any way we shall have the opportunity to review it. At present I merely seek sufficient power to deal with the overwhelming bulk of commercial piracy in this country, and all the evidence that I have received suggests that the Bill will do that.
  The video amendment to the Copyright Act has been successful because a special body of people has been established to police it. The video industry came together in the Federation Against Copyright Theft and established a small unit of highly qualified people to investigate piracy and present evidence to the police. The matter is then subject to ordinary police inquiries as in any other criminal case. That system has worked extremely well and I pay tribute to the director general of FACT, Mr. Bob Birch, a former solicitor with the Metropolitan police, and to Mr. Peter Duffy, a former commander in the Metropolitan police. They have established a first-rate unit working closely with police forces throughout the country, collecting and collating evidence of criminal activities and bringing it to the attention of the police. The police then apply for search warrants and make arrests if the evidence justifies it. The police conduct a perfectly normal criminal investigation and bring charges if there is evidence of crime. None of that is done by the special unit, which merely collates the evidence and puts it to the police. The Federation Against Software Theft would wish to act in exactly the same way, to employ people highly qualified in this kind of work and to operate in the closest possible collaboration with constabularies throughout the country to ensure that criminals are brought to justice. Evidence from police officers shows how well the system is working with FACT.
  Clause 3 provides for the penalties. At the moment there are no criminal penalties, but if the Bill is passed the penalties will be the same as for any other breach of the Copyright Act — a maximum sentence of two years' imprisonment on trial by indictment, and unlimited fines. That will be a substantial deterrent. The pirates will find their activities ever more closely monitored by experts, there will be a substantial risk of prosecution and the penalty will not be a £40 fine under the Trade Descriptions Act or prolonged civil proceedings at escalating cost which at present prevents so many firms from taking action.
  The single most important thing that we can do to help the industry to develop and to prosper is to extend the Copyright Act. That is why I have taken so long to outline the reasons for the Bill and to lay before the House an analysis of the evidence. I am confident that if the Bill becomes law all the possibilities for the industry will be

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  put into forward gear, bringing growth, new jobs, new export potential and new wealth for this country. Without it, there will be increasing piracy, further bankruptcies, reduced commission and wasted prospects. I am sure that the House would not countenance such a prospect.
  10.37 am
  Mr. Paddy Ashdown: First, I apologise for the fact that I shall have to leave at about 12.30 and thus may not be present when the hon. Member for Corby (Mr. Powell) sums up. I congratulate him on a comprehensive speech packed with interesting information and powerful examples to show the necessity for the Bill, which I strongly welcome. I also congratulate him on coming fairly high in the ballot for private Members' Bills, which we all enter half hoping to come high and half hoping not to come high because we realise how much time it takes to handle a Bill of this kind. I entered the ballot hoping to come high specifically to introduce this type of legislation. It was thus a particular pleasure to hear the hon. Member for Corby introduce his Bill so cogently and powerfully. As the hon. Gentleman generously said, the foundations for the Bill were laid by the hon. and learned Member for Mid-Bedfordshire (Mr. Lyell), to whom I also pay tribute — indeed, it was his ten-minute Bill that encouraged me to pursue the matter myself.
  If Britain is to maintain her prosperity we shall have to establish a new base for that prosperity and a new kind of industry. I believe that the whole House is aware of that. I have long believed that we shall have to move away from the old high-resource use, relatively low value-added industries and away from Britain's old traditional base towards a new sort of base, or towards what might be called a low-resource use, high value-added industry.
  Mr. Phillip Oppenheim: That is highly original.
  Mr. Ashdown: Does the hon. Member for Amber Valley (Mr. Oppenheim) wish to intervene, because I would gladly give way to him? I gather that he does not want to intervene. He just did so, as usual, from a sedentary position.
  That is the economic base that we shall have to encourage. We shall have to make use of our human and intellectual property much more effectively in future if we are to develop that base and that sort of wealth for the future. The software industry is pre-eminently that sort of industry. It converts intellectual capacity, brainpower and ingenuity into wealth. It is a classic example of a low-resource use, high value-added industry that turns brainpower into money. It is also a classic example of an industry that has, and will continue to have, a thriving small firms sector that feeds into the larger software houses.
  Perhaps this industry is the 20th or 21st century successor to the old cottage industry. It is conducive to being centred away from the big cities, and people can work from their own homes. It is something much to be encouraged. As the hon. Member for Corby has said, we are very good at it in Britain, or at least we were. We were once world leaders. Indeed, I still believe that in terms of ingenuity of software packaging and production we are as good, if not better than anyone else in the world. But as the hon. Member for Corby pointed out, our industry, while not perhaps in total decline, is certainly not progressing as it used to do.
  1344
  One reason for that is that much of Britain's brainpower has a habit of translating itself abroad. Recently, I went round Silicon Valley in America and discovered that the highest proportion of non-Americans there is accounted for by British expatriates. There are even more British expatriates there than Hispanics and most of them are involved in the software business.
  However, we are good at producing software, as we have proved in the past. We already have an industrial sector in Britain that is to be encouraged by any means that we can find. I know that the Minister, the hon. Member for Coventry, South-West (Mr. Butcher), who is not at present in his seat, is very keen to do that. I have some doubts of a broader nature about the Government's policy for developing that sector properly. Indeed, I have some doubts about whether they are encouraging it and developing it in the way that they might do. But that is a matter for a different debate.
  There are two barriers to the proper development of this most important sector of our industry. One barrier is looming and yet to come, but the other already exercises a profound and doleful influence over the industry. I hope that we shall debate the barrier yet to come in a month or so. I refer to the application of the licensing requirements for the export of software abroad under the new COCOM regulations. How they will apply, how they will affect the market, and how we are to honour the commitments apparently laid on us are matters of deep concern for the industry. But with any luck they are again a subject for a future debate. I hope that the Government will grant that debate, because the implications of that agreement are profound for that sector of the market.
  The barrier that is here, and here with a vengeance—and which the Bill tackles with great effect—involves software theft. I have said that it is a barrier to the development of the industry, because it establishes a black market that unbalances the whole industry. The rewards for the production of intellectual property accrue not to those responsible for it, or to the inventor or designer, but to the pirates. It is they who get the profits. The black market is also highly developed. The hon. Member for Corby said that we had perhaps let the piracy of video tapes go on for too long, as that also involves a highly developed black market. Although I very much welcome this Bill, one could always say that one might have hoped for its introduction even sooner.
  According to most reliable calculations, we are losing about £150 million a year to the software pirates. There is a fully established black market distribution system. As FAST has reminded us and as I think the hon. and learned Member for Mid-Bedfordshire mentioned, a person can go to Blackbushe market and find such items sold perfectly openly and in some volume. Backing up that distribution system is a sophisticated production mechanism. Again, I think that the hon. and learned Member for Mid-Bedfordshire mentioned that in at least one case—and no doubt in others—people have been known to have factories specifically for piracy purposes, and the reproduction of software.
  Furthermore, piracy is not confined to one sector. It spans the whole industry, from the high-price, relatively low-volume software right down to the computer games area. The pirates are even sophisticated enough to make some minor changes to the product that use somebody else's intellectual property, and to add certain things to it that give it a new characteristic and perhaps appeal. In all

  1345
  those senses, we are talking about tackling a highly developed black market. It is large, and growing every day. In a sense, it is perhaps a cancer that sits in the industry, preventing the proper development of the industry and robbing people of their rightful rewards.
  That must be stopped to the benefit of British industry and to the benefit of the development of this country's intellectual property. But as the hon. Member for Corby has said, there are problems about stopping it. The problem about software theft is that it is easy. It does not seem like theft. To copy a programme, the person merely has to sit down at his computer, call up his copy programme, touch the button and there it is. That does not seem like theft. There is no break-in or anything clandestine. It can be done at home. I recognise, of course, that the Bill is directed not towards the casual copier at home but towards the commercial pirate, but that is how simple it is.
  The problem is that, because we have ceased to treat the matter seriously, many people who would not dream of stealing a piece of hardware would nevertheless think that the copying of software is somehow not theft. But theft it assuredly is. It is the theft of somebody else's intellectual property. The Bill provides a framework enabling that point to be made.
  I think that the hon. Member for Corby probably made the case more powerfully than I can, but it should not be believed that legislation will solve the problem. In itself, it will not. The hon. Gentleman used the word "policing". As he is a lawyer, I was surprised to hear him say that. He went on to say that it was the police who did the policing. But a back-up organisation is needed, as with video piracy. A back-up organisation is needed to police or scrutinise the Bill effectively so that it can be operated in the way that the hon. Gentleman intends. It must be remembered that that is what, under a similar piece of legislation, has reduced video piracy by two thirds since 1983.
  I pay tribute to FAST for what it has done to bring this matter so effectively, and in a very responsible way, before the House. I also pay tribute to it for providing us with a back-up system with which to scrutinise the Bill's operation.
  This is an important Bill. As the hon. Member for Corby said, it is a Bill to protect property, investment and jobs. It will help to provide a framework for creating new jobs, new wealth and prosperity. It is an important component in a new strategy for the industrial regeneration of Britain. It is a vital component since it addresses itself to a vital sector of industry. I am happy to welcome the Bill. I hope that it will progress as fast as possible and become legislation as quickly as possible.
  10.50 am
  Mr. Michael Marshall: I agree with much of what the hon. Member for Yeovil (Mr. Ashdown) said. I apologise to my hon. Friend the Member for Corby (Mr. Powell), the Minister and the House because I shall probably have to return to my constituency before the end of the debate, although I shall listen to as much of it as I can. I welcome the Bill and I intend to do everything that I can to help my hon. Friend with the Bill's further stages.
  Once again we are trying to legislate in the face of a technology which leaps ahead of us all the time. My hon. Friend the Member for Corby and the hon. Member for
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  Yeovil were right to argue that the Bill should be considered not in isolation, but within the broader context of copyright. I declare an interest as an author and playwright and one who hopes to see some of his work translated to software.
  One cannot but be worried by the many copyright problems which remain. The literary copyright involved in books is pirated throughout the world. Pirated copies of paperbacks are to be found everywhere. The video piracy problem was one of enormous proportions. When we legislated it was estimated that about 70 per cent. of videos sold in Britain were pirated. We legislated just in the nick of time.
  We should be able to look to a back-up organisation. I support the work done by the Federation against Software Theft and Mr. Maclean. I hope that the Minister will take the opportunity to explain the Government's view of the wider copyright question, how we should seek to keep in touch with technology and the difficulty of producing legislation which encompasses the leaps ahead in technology. I am thinking in particular of the role of the World Intellectual Property Organisation. That has been set up to try to deal with some of the problems. I hope that my hon. Friend the Minister will say something about the prospects for an international convention. My hon. Friend the Member for Corby described some vivid examples of international competition.
  I shall highlight some of the existing problems. My hon. Friend the Member for Corby spoke about legislation running parallel in other countries. I welcome that, but some anxieties remain. For example, Australia is regarded as the piracy capital for software mainly because a recent case resulted in the decision that computer software does not fall within Australian copyright law. Australia seems to have greater freedom in that respect.
  Mr. William Powell: That case caused appalling problems but the Federal Parliament intervened and legislation was passed. The original decision was reversed and the law has now been straightened out in Australia.
  Mr. Marshall: I am obliged to my hon. Friend. I was sure that he would be able to help. However, it is a simple matter to take software out of the country. For example, it can be put in an envelope and posted to Australia. If the software is then adapted, the law is uncertain. Software which is adapted, even marginally, can be sent back here and may not be covered by copyright law. The role of Governments in such matters is important and I hope that the Minister will say something about it.
  I have declared my interest as an author. I am the co-author of a pamphlet which argues that, with the wholesale adoption of new technology, 3 million new jobs could be created by the end of the century. This assumes that the balance of traditional industry, net losses and net gains is neutral. In that argument and detailed estimates I was assisted by Philip Virgo who has done some important work at the National Computer Centre. We estimate that the creation of the new jobs turns precisely on the reform of copyright as it affects software. I shall explain why.
  The way in which jobs can be created in the entertainment world through legislation to prevent video piracy has already been shown. My hon. Friend's proposal will also have its beneficial impact on computer games.
  I have a particular interest in educational material. On a recent visit to a school in my constituency I saw

  1347
  something which is new in my experience. I saw a class being taught by a teacher who had prepared software which simulated the production of a chemical. The software showed the way in which raw material costs and other costs are brought together. It enabled the 16-year-old pupils to work through the process by which a chemical is produced. It showed how its selling price was worked out and how resulting profit enabled new investment to be made.
  To me that is a rare form of software. It was created by the enthusiasm of the teacher and because he had access to a company which helped him to put the software together. It points the way to an enourmous opportunity for more creative software with practical application in education. Such activity can create large numbers of jobs. However, such software is labour-intensive. In short, using new technology is likely to make teaching more effective and to create jobs.
  We are approaching the time of shorter working lives, shorter working weeks and early retirement. The growth of adult education is therefore likely. Many of us see a role for ourselves in that area. Adult education is one of the inbuilt advantages of this place.
  About 3,750,000 people are involved in further and adult education. It is estimated that if that figure were trebled—which is not unrealistic—and 12 million adults demanded 200 hours of material a year on 25,000 different topics, that would create employment for 400,000 programme preparers. Such figures are within our grasp if the fruits of this labour are not frittered away through piracy. Again, our estimates for information services show the potential for an additional 400,000 jobs during the next few years, once more based on adequate copyright reform. The United Kingdom information services industry is already employing over one million people. Prestel, which has barely begun to make its full impact, is the sort of area in which jobs will develop. It is a typical example of a product that is dependent on copyright reform. My hon. Friend the Member for Corby was modest in his remarks about job creation; I believe that there is substantial scope.
  My hon. Friend also touched on the competitive position, and here there are some anxieties. Experts suggest that although we have been extremely good at producing software to make computers work, we are not as effective in producing software to help companies perform particular tasks—yet that is the area in which competition now runs most strongly. We must watch some of the opportunities being exploited by our competitors. The design of software for more effective use by manufacturing companies is an area that provides an obvious target for piracy. Industrial espionage is a highly developed form of piracy, and I can envisage piracy being directed down to a narrow point with the stealing of industrial secrets through software unless legislation is tightly drawn and applied internationally.
  However, Britain has certain competitive advantages. Japanese development still has difficulties to overcome, not least the question of language. The United States, because of the pound-dollar relationship, is now expensive. The United Kingdom software industry is well placed to look for a further drive with this legislation behind it. We should look to the leading edge of technology and provide software that is more directly relevant to company needs rather than simply exploit the computer, which is no longer the area where innovation and inventive skills can best be deployed.
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  There is another aspect of international competition, which is the degree to which other countries, in making their parallel legislation, agree to further consultations and discussions — not only through the World Intellectual Property Organisation but on a Government-to-Government basis. I also agree with the suggestion of the hon. Member for Yeovil that the future of the COCOM export arrangement is relevant.
  The Bill is admirably clear. It sets out to do something that we can all support. However, I am a little anxious about how it will be seen to be effective and whether we can be sure that it will not be overtaken by further technological development. Will my hon. Friend the Under-Secretary consider whether it might be worth while extending the process that the Government have already taken on board — to look for the establishment of a number of small bodies, possibly created through industry itself—as FAST has been—but a body that is also seen to be outside the industry. It is difficult for an industry-organised body to adjudicate between competitive claims in industry. Oftel and the proposed Space Centre have recently been created. Possibly, following that example, the Government could see a way not only to meet my point about adjudication but to see the matter in relation to the industry's international activities — for example, its relationship with WIPO and with other countries. That might be a helpful way to ensure that we keep ahead in that area.
  My hon. Friend the Under-Secretary has always shown the greatest enthusiasm in these matters. He must recognise that from time to time Ministers and civil servants move posts. It is a weakness in our system that something which has been sustained through legislation and by understandings between countries can suffer a setback through a change of personnel or a change of the driving force in certain policies, and that we can no longer continue along the road that we had begun to walk with some certainty.
  I would not normally suggest that a quango is still hidden in the corner of every heart, but in such a practical area there is an opportunity to consider with clarity and purpose the ways to make this Bill more effective.
  I welcome the Bill and congratulate my hon. Friend the Member for Corby on the way that he introduced it. I wish it every success and I will help my hon. Friend in any way that I can during the Bill's further stages.
  11.7 am
  Mr. Nicholas Lyell: I am very glad to follow my hon. Friend the Member for Arundel (Mr. Marshall) and endorse his sentiments. I congratulate my hon. Friend the Member for Corby (Mr. Powell) both on his good fortune in rising high in the ballot and on his supreme good sense in picking up this Bill and promoting it so efficiently and diligently to its present stage. I hope that before too long it will have a safe passage through this House and another place and on to the statute book. I thank FAST for its extremely efficient efforts to correlate the information and present it in an extremely attractive and effective form. I also thank the Ministers who have been involved—my right hon. Friend the Member for Mole Valley (Mr. Baker), my hon. Friend the Member for Chertsey and Walton (Mr. Pattie), my hon. Friend the Member for Pudsey (Mr. Shaw) at the Home Office—which played a significant part because of the enforcement

  1349
  aspects—and my hon. Friend the Member for Coventry, South-West (Mr. Butcher) who is with us today and who has such great knowledge of this area.
  I do not want to repeat the speech that I made in July on my ten-minute rule Bill. I want to do what both my hon. Friend the Member for Corby and my hon. Friend the Member for Arundel did, which is to put the matter into the wider context of intellectual property reform, in which it has a real place. Some people are worried that this is another piece of piecemeal legislation and that we should not indulge in it. The House recognises that the need for protection against piracy is so urgent that the simple and beautifully clear Bill provided by the parliamentary draftsmen is eminently justified.
  In the piracy of computer software, we are dealing not with the sophisticated plagiarist but with the outright crook. We are not dealing with someone who has his own sensible ideas and who may be overstepping the mark in drawing upon other people's ideas. We are dealing with people who have in the recent past invested money to pirate videotapes, and, having found that avenue to a quick buck closed off, have reinvested their ill-gotten gains in equipment that enables them to copy computer software.
  The profits that can be made were amply set out by my hon. Friend the Member for Corby who pointed out that there can be, and has been, enormous innovation in the games market, which is at the bottom end, but that that innovation has been stolen in the most crude and callous way by the pirates so that, for the time being, innovation has largely dried up.
  There is also a serious problem in business software, particularly for use on microcomputers. One can copy a floppy disc for, say, word processing software—such a disc would market at between £200 and £300—on a twin-disc drive microcomputer in perhaps 10 seconds.
  That brings me to another unattractive feature of piracy that is not so much to do with the back-street manufacture and marketing through Blackbushe or the less reputable shops in the metropolis and elsewhere, but concerns the temptation offered to hardware manufacturers to encourage the sale of their hardware by supplying genuine software that is not good value but under-the-counter, swiftly pirated software, so enabling the user to get many hundred pounds more value out of his recently purchased hardware at someone else's expense—that someone else being the software house that has developed the software at substantial investment.
  The industry has made great efforts to create a policing structure and I am confident that FAST and members of the industry will create a real policing structure once the Bill is on the statute book, a structure that will not put a significant extra burden on the public authorities and the police. Once we get the framework of law right, neither the policing nor the process of prosecution will be difficult. Once it is widely recognised by the pirates that they can swiftly be prosecuted, the object of the Bill—which is not to bring people to court but to dry up piracy—will be achieved.
  On the wider scene, what should be our overall objective in the reform of our intellectual property system? That system covers patents, copyright, trade marks and other ancillary aspects. Hon. Members will agree that the
  1350
  object of our intellectual system should be to promote the technical and commercial interests of British industry in a fair and effective way.
  The December 1983 Green Paper set out a framework for that, but it tried perhaps to construct an over-elaborate system that appeared to give so much protection to the owner of the intellectual property right that it could be abused to the disadvantage of certain aspects of the market. I say that not in a dogmatic way but to stimulate further consideration of the matter.
  The intellectual property sub-group of the Society of Conservative Lawyers issued a paper, from which I have drawn heavily, which merits careful consideration by the Department of Trade and Industry, and I shall mention a few areas into which we should be progressing in parallel with the objectives of this measure.
  People often think that intellectual property rights, patent rights and copyright are there to help the brilliant small innovator against the big man. All too often, however, patent rights and copyright can be exploited only by the large firm with substantial resources. The brilliant innovator who is seeking to do constructive work for himself and the nation can find himself enmeshed in a web of restriction and patent control, often involving trivial modifications of earlier patented or copyrighted aspects about which he cannot afford to litigate.
  Lawyers who practise in this area—I am not one of them, although I have some experience of it—must time and again explain to their innovative clients that while they are almost certainly right in law, the maelstrom into which they would become involved if they embarked on litigation would bankrupt them; and they must advise them, as a matter of commercial common sense, to withdraw.
  Mr. Michael Marshall: My hon. and learned Friend reminds me of a point that I intended to make but omitted to do so. I appreciate the line that he is pursuing and, like others, pay tribute to the spadework that he has done in this sphere. For the sake of simplicity and of trying to be comprehensive, will he accept that the use of the words "electronic publishing" would be better in some respects than talking about "computer software"? As we are looking for wider forms than those which relate purely to computers, he might care to join me in tabling an amendment in Committee which might be helpful in that respect.
  Mr. Lyell: I am grateful to my hon. Friend for raising that interesting point. There is always difficulty in finding a more accurate phrase but we need one which bites firmly on the mind of the potential infringer. While I concede that his phrase may have certain advantages in accuracy, it might not come so swiftly to the mind of the pirate, and that is the mind we seek to impress. However, I shall give the matter further thought.
  In considering how we proceed in parallel with the Bill in other aspects, we must remember that our present systems of intellectual property protection seem to give more protection to the foreigner than to the home-based innovator or producer. It is interesting to note that today the majority of patent holders in Britain are not United Kingdom-based. In 1983, the latest year for which I have statistics, 80 per cent. of all patents granted were granted to non-United Kingdom residents.
  The structure of our intellectual property law is such that in wide areas the negative effects outweigh the

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  positive. Our restrictions bite heavily on those who seek to innovate and manufacture in our home market but are much less restrictive on those who import.
  We have the ludicrous situation that manufacturers in this country can be faced with competition from abroad which our existing legislation does not prevent, while, when those same manufacturers seek to export to other countries, as they lawfully can under the laws of those other countries, they may be prevented from doing so by our own intellectual property law in Britain. I hope that the Department will give urgent attention to that state of affairs because it needs correcting.
  The Green Paper seems to go back on, if not a previous commitment by the Government, then at least a strong indication by Government that it would abolish industrial design copyright.
  I do not think that it is widely recognised that our system of protection of industrial design copyright arose by accident. It was unforeseen and unintended by Parliament at the time of the passing of the Copyright Act 1956 and the Design Copyright Act 1968 and has come to be established only because skilful lawyers—who could perhaps be described less attractively as clever lawyers —were able to put together section 3(1)(a) of the 1956 Act which defines drawings as artistic works, "irrespective of artistic quality", and section 48(1) which says that a reproduction in a case of an artistic work
  "includes a version produced by converting the work into a three-dimensional form".
  Thus, artistic copyright protection is given to the shape of mechanical parts. No one using the English language in its ordinary sense would have contemplated such a possibility.
  Those who could produce parts for machines and functional items and could compete in this country are prevented, by a side wind, from doing so. All patent and copyright law legitimises monopoly, but monopolists are being given a far wider monopoly than was ever intended. These are sophisticated matters and I do not wish to weary the House with too much detail, but similar problems arise with parallel imports and on copyright law and piratical imports.
  Case law can adversely affect practical considerations. I speak against myself as a lawyer and a practitioner in the courts, but in intellectual property law, the case of American Cyanamid v Ethicon has had an adverse effect. One of the great advantages of patent law used to be that when one went to court for an interlocutory injunction — one seldom went further because the object was to stop the infringer in his tracks—one was given a good indication of the strength of one's case because the law before American Cyanamid v Ethicon required that the court had to form a significant view, though not a final view, on the merits of the case.
  The House of Lords subsequently said that that was not the correct law in the general field, which then applied to intellectual property law, and all that one now has to show is that one has a fairly arguable case, which is different from showing that, on at least an initial view, the merits are in one's favour.
  We have changed that lesser requirement in industrial relations law, and everyone agrees that we were right to do so, and we should also abolish that approach in intellectual property law, so that those who go to court for swift and effective procedures get once more the swift and effective judgments that were so useful in the past.
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  I congratulate my hon. Friend the Member for Corby and ask that the Bill be seen not as an isolated piece of legislation, but as an important measure which will be essential to protect the industry from a serious problem and will, I hope, be part of moves by the Department of Trade and Industry towards further sensible reforms in intellectual property law.
  11.23 am
  Mr. Andrew Hunter: Those of us who attempt to follow my hon. Friend the Member for Corby (Mr. Powell) face two daunting tasks. The first is to match his eloquence, which is difficult, and the second is to match the detail of his exposition, and that can he done only by indulging in a degree of repetition.
  I cannot claim marks for the originality of the preface to my comments because the point has already been made by my hon. Friend the Member for Arundel (Mr. Marshall), my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell) and the hon. Member for Yeovil (Mr. Ashdown), but I do claim marks for sincerity when I congratulate my hon. Friend the Member for Corby on taking the initiative that led to the Bill and to this debate.
  My hon. Friend the Member for Corby was the first to say that some acknowledgement must also be given to my hon. and learned Friend the Member for Mid-Bedfordshire whose ten-minute Bill established him as the parliamentary progenitor of this Bill.
  It would also be appropriate at an early stage in my speech for me to join in singing the praises of the Federation Against Software Theft, which has been the prime mover in the campaign which has resulted in the Bill. My hon. Friend the Member for Corby paid tribute to the effective, reasoned and sensible way in which the federation handles its affairs. I echo that sentiment and note the sharp contrast with much of the sensationalism and bellyaching that we get from so many other lobby forces. I heard on the radio yesterday that dentists have been asked to write not only to their own hon. Member, but to all hon. Members.
  May I inject an irreverent but heartfelt plea. For 13 years before becoming an hon. Member, I was a school teacher and one of the subjects that I taught was English. Perhaps I am more fussy than some other hon. Members, but I make the plea that on this side of the Atlantic we should spell the word programme with double "m" and an "e" at the end. That spelling appears in the body of the Bill, but not in the explanatory and financial memorandum. Let us have some consistency.
  Mr. Timothy Wood: I support my hon. Friend's plea for consistency. One can take the view that the use of the word "programme" in relation to computers is different from any other use of the word and that therefore we should use the spelling "program". In that case, we should use that spelling throughout the Bill and not use one version of the word in one part of the Bill and duck the issue in another part. The spelling "program" is used throughout the world and I believe that it should be adopted in the Bill.
  Mr. Hunter: All hon. Members can claim, to a greater or lesser extent, to represent the interests of high-tech industry. Computer business is a prominent part of that industry. High-tech industry tends to gravitate to certain

  1353
  parts of the country, one of which is the corridor between the M3 and the M4. Within that triangle, Basingstoke has increasing importance. I am advised that about 5,000 of my constituents are employed in the computer industry, and the number is rising rapidly as IBM and the Digital Equipment Corporation increase their presence in the town.
  Thousands of my constituents therefore depend for their livelihoods on a flourishing computer industry, and the point of the Bill is precisely that: to ensure the prosperity of the computer industry. The Federation Against Software Theft does not mince its words. It says:
  "Software theft is a serious and immediate problem threatening innovation, jobs and investment in the computer industry."
  It is estimated that the industry is losing about £150 million a year through software theft. That is intolerable. That loss hits at the profitability of industry and, as we all know, that decreases the prospects of reinvestment, innovation and job creation.
  A point which has been made frequently in the debate is that it is relatively easy to engage in software piracy. Such theft takes a variety of forms depending on the type of computer software which is involved. To the lay mind the distinction between various forms of software theft are perhaps not immediately discernible. I understand that there is replication without permission; there is counterfeiting; there is the production of look-alike copies substantially reproducing legitimate programmes; and there is the unauthorised supply and use of computer software. I have no doubt that there are many other forms of software theft.
  My hon. Friend the Member for Corby warned that I would concentrate on one firm if I were lucky enough to catch the eye of Mr. Deputy Speaker. The Digital Equipment Corporation has a major presence in my constituency. It is known in the trade as DEC, and from now on I shall refer to it thus. It is worth while considering the way in which that company has analysed the problem of theft and set about seeking solutions.
  About two years ago DEC undertook an analysis to try to establish the loss which it was suffering from software theft. It calculated the number of computers which it was selling in the United Kingdom, presumably not an especially difficult task. It then made certain assumptions about the average number of operating systems, allied projects and application programmes that it expected to licence per computer. The calculations of the expected licence revenue were compared with actual revenue and the company made the staggering calculation that it was losing about £10 million per year: clearly a figure of great consequence and seriousness to it, notwithstanding that it has the third largest turnover in the industry in Britain.
  I have already stressed the consequences for companies whose profit margins are being hit by theft. Reduced profit margins ultimately affect job creation. DEC's reaction was typical of companies in this position. First, it joined the organisation that is called the Federation against Software Theft. It was one of the founding members of FAST. Mr. Roger Tuckett of the law department of DEC in the United Kingdom became, and remains, a member of the FAST management team. DEC senior management in the United Kingdom and in Europe gives the federation full and total support. The international factor has already been
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  introduced into the debate. DEC sees the initiative which has been taken in Britain as one that should be followed up in other European countries.
  DEC's second reaction was to work through the trading association to counter the problem of software theft. DEC is represented on the intellectual property committee of Beta, which is considering the interests of companies similar to DEC.
  The company's third reaction was to take legal action. In 1983 there was an out-of-court settlement following a dispute about the unauthorised copying of DEC software and the failure to pay licence fees. Nearly $5·5 million were paid to the company in settlement. Other proceedings continue. There are proceedings against another company alleging unauthorised copying and distribution of DEC software. There have been 11 court hearings to date and, apart from one minor issue, DEC has won at each hearing.
  The company's attitude is typical of that which is being adopted by other comparable companies. It feels that it must protect its investment in its technology and it will not hesitate to enforce its rights in the courts if necessary.
  The growing significance of software manufacture to the computer industry is not always realised. It is the largest growth area within the industry. I received a letter from DEC this morning, one paragraph of which reads:
  "on the relative importance of DEC's software business, this now corresponds to about 15 per cent. of total turnover. While DEC's business overall is growing at about 30 per cent. per year in the United Kingdom, the software related part of this is growing at about 65 per cent. per year."
  Those are most impressive figures.
  It is clear that theft affects all parts of the software business. FAST has distinguished three major categories. First, it speaks of theft of high-cost/low-volume software. That is software that is used on large or medium-sized computers which retail at a price of £1,000 upwards. This software includes operating systems and application packages. In this area we are up against unauthorised copying and using by users, illicit copying by distributors and the production of look-alikes.
  The second area which FAST identifies is the theft of medium-cost/medium-volume software. This is software that is used on microcomputers within a price range of £50 to £1,000. It includes smaller business computers and personal computers. The illegal practices include illicit copying and use and supply by users and distributers.
  My hon. Friend the Member for Corby referred briefly to a study which was undertaken by Aston university in 1983. Among other things, those who undertook the study came to the conclusion that 25 per cent. of microcomputer software companies suffered serious losses of revenue through software theft. The more successful programmes are the most susceptible to theft. The number of illegal copies exceed legitimate copies by more than three to one.
  Thirdly, FAST has drawn attention to the category of low-cost/high-volume home computer software theft. This includes computer games and education software. We are talking of software that is distributed mainly through high street outlets. There is widespread counterfeiting. Illegal copies outnumber legitimate copies by up to 12 to one.
  FAST has analysed current prosecution activities. It is clear that software copyright owners are already pursuing policing and enforcement activities, including investigations, the targeting of criminals, the search and seizure of

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  illegal material, prosecutions, and, above all, publicity and education. These are some of the activities in which companies are already involving themselves to the full.
  Major companies are conducting a growing numbr of investigations into software theft, especially in the high-cost/low-volume software league. Legal action is being taken and I have learnt of the establishment by the Guild of Software Houses of a fighting fund to help finance legal actions.
  In all cases FAST stresses that prosecutions are limited to civil actions because of the unrealistic criminal penalties currently available for copyright infringement of computer software. The most significant point is that the smaller companies with slender resources, especially in the microcomputer software sector, are reluctant to take legal action because of the element of doubt that still remains about copyright protection applying to computer software. There is a residual doubt about that part of the law, and that doubt must be removed.
  A paper produced earlier in the year by Mr. Roger Tuckett contains clear thoughts on this matter. The paper was entitled "Controlling Infringement of Copyright in Computer Software" and stated:
  "Under Section 21 Copyright Act 1956, it is a criminal offence to manufacture or distribute articles which are known to be infringing copies of a copyright work. There is no reason why prosecutions should not be brought under the present legislation in appropriate cases for software piracy. However the police and other authorities are reluctant to investigate and institute prosecutions for two reasons. First, they believe there is still legal doubt that computer software is protected under copyright law. Secondly, they believe the present criminal penalties are derisory."
  The paper continued:
  "In the past, criminal prosecutions for software piracy have been rare. Today there are a handful of such criminal investigations taking place, some of which may result in appropriate prosecutions and convictions.
  Prosecutions are normally brought by Police Authorities or Trading Standards Officers. These bodies are showing increasing willingness to become involved in helping to deal with this increasing area of dishonesty. They will continue to look to the computer industry for technical advice and support when bringing prosecutions. If a company which is suffering from software piracy is able to persuade these authorities to take action, it will obviously avoid the considerable expenses involved in bringing civil proceedings. It is hoped that the clear effective remedies to be provided by the new Copyright (Computer Software) Amendment Bill will encourage these public enforcement agencies to use their resources to deal with the current and future problems."
  I believe that we all share that hope.
  The need for legislative changes is indisputable. There is an urgent need for clarification and strengthening of the law. This serious problem will be reduced and the effectiveness of all the remedies—civil and criminal—will be increased by these amendments to the Copyright Act 1956. That is why we need the amendments. They are straightforward and are not contentious. It is clear that they will appeal to, and be accepted by, all parties represented in the House.
  The Bill will enable the industry to continue its fight against software theft within a framework of legal certainty and more effective copyright protection. As FAST concludes, for all categories of software theft, the explicit reference to computer programmes in the Copyright Act will be the cornerstone for educating everybody that software theft is not "fair game" but illegal and to the detriment of the community. I welcome the Bill, and I wish it well.
  11.43 am
  Mr. Phillip Oppenheim: I warmly welcome the initiative taken by my hon. Friend the member for Corby (Mr. Powell) in introducing the Bill and the earlier initiatives of my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell). The information technology and software industry owes them a great deal for the large amount of time they have spent in pushing the Bill through.
  I believe that the Bill should not be necessary. It is necessary because of a fundamental fallacy. The same fallacy gave rise to the Data Protection Act 1984 which is costing British industry several hundreds of millions of pounds. The fallacy is that data are somehow fundamentally different if stored magnetically on a floppy disc, a hard disc, a tape or by some other method of digital storage rather than stored on paper in black and white. It is ludicrous that companies can store millions of names and addresses in card index systems without falling within the jurisdiction of the Data Protection Act, but if the information is stored on a home computer or microcomputer, the companies fall within the bounds of the Act.
  In the past, lawyers, in their wisdom, have decided that, because data are stored magnetically or electronically, they do not fall within the bounds of the Copyright Act 1956. The Bill is an important part of a jigsaw. If over the next few years we can find the other pieces of the jigsaw, we may reveal a picture of a healthy information technology industry. The Bill is only one piece of the jigsaw. Unfortunately, too often we in Britain put ourselves down. Company failures in the information technology industry cause us great concern and receive great publicity, but, for every company that fails in a blaze of publicity, there are many more healthy companies. Failures are a facet of a young and growing industry.
  The NEDO report, which was published in the summer of last year, cast gloom over the information technology industry. Astonishingly, the report did not deal with microchips. British companies are rapidly becoming European leaders in microchip production, especially in certain types of chips such as Customs chips and fast Dynamic RAMs. Because the report did not mention microchips, it missed a vital component of the information technology market.
  We can be proud of our achievements in information technology. Some of the best business computers are made in Britain. It is interesting to note how one relatively small Birmingham company—ACT—managed to change itself from being largely an importer of American computers into a major force in the manufacture of home computers. Although British industry is under severe pressure from foreign competition, some companies, such as PSION, are producing products that are world beaters.
  Government policy has been forward looking and instrumental in encouraging the information technology sector in England. Pump-priming policies and specialist schemes have been the correct way forward. It would be wrong to go for vast, ludicrous bureaucratic and expensive projects, such as those mounted by the last Labour Government. For example, the Labour Government wasted £36 million of taxpayers' money on one project—a company called NEXOS which, apparently, Labour politicians dreamt would one day rival IBM. Two years

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  ago, predictably, that company went under because of mismanagment and the problems of setting it up. The taxpayer is £36 million poorer.
  Despite the successes of the policies of the Department of Trade and Industry in encouraging the information technology sector, we need more direction. I am not talking about French-style dirigisme which has helped to plunge the French information technology sector into massive losses. I am talking about the realisation of where our national interests lie, and that means that a more aggressive attitude must be taken to trade barriers which inhibit the growth and prosperity of the information technology industry in England.
  The European, Japanese, and far east telecommunications markets are far from free. Any British company wanting to export software or information technology products to American markets come up against the Buy American Act. That means that if public corporations wish to buy foreign products they must cost at least 10 per cent. less than comparative American products. I should be astonished if that could be called free trade. Yet this country freely allows in telecommunications products from Italy, Germany, Japan and Taiwan. Our schools are full of American products.
  I understand that one of the major reasons for the problems of Acorn was its failure to break into the American market. One of the reasons for that failure was that it could not get into the American education system because the United States Government insisted that it brought American-made products. The company also came up against the Buy American Act. I strongly believe that free trade is the best way to further the prosperity of all nations, but it is clear that we do not have free trade in the world. When other countries refuse to take our products on a reciprocal basis, we must be far more aggressive in putting barriers in the way of their products until they open their markets to our information technology and other products.
  We seem to be acting against the interests of our information technology industry over origin marking. The origin marking regulations are now hopelessly out of date. Most business equipment, including computers and software, do not have to have on them the country of final assembly or the countries where most of the components are made. We can buy a computer or software over the counter or by mail order without knowing where it was made. Most people want to buy British goods, be they computers or software, but more often than not they do not have the opportunity to know where the equipment was made.
  I shall quote the example of a British company called Amstrad. It imports its own-brand computers from Taiwan. It is a successful home computer which is sold with a range of computer software and most people buying that product believe that it is British. Even the Financial Times, which should know better, called it a British product.
  How can British consumers buy British-made computers? The structure of the industry is such that many computers contain foreign components. How can we urge our consumers to buy British when we do not, by law, insist on manufacturers, importers and distributors putting the countries of origin on computers, telecommunications equipment and software?
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  Another way in which we seem to be acting against the interests of our information technology sector is that we charge more duty on the import of components that go into British computers than we do on the import of fully built computers. It is a disincentive for British manufactured computers to compete if their components carry more duty than the finished, imported product which probably contains the same components.
  This country has a great opportunity to win a large share of the world software markets if we can get matters right. There are many ways to get it right other than by the Bill. The structure of the information technology market is moving in such a way that it is especially easy for small companies to produce and market software to run on a range of machines, because increasingly over the past five years world computer manufacturers have a few standard processes and operating systems which they buy and assemble into their products.
  The result is that computers, be they made in Taiwan, Tokyo, Frankfurt or Farnham, almost invariably run the same software. That means that a company no longer, as it did 10 years ago, has to be massive, with massive resources, to write software. Relatively small outfits can now succeed. A problem that many of those companies experience, apart from piracy, is the cost of marketing. It does not cost a vast amount to produce an excellent software package, but it costs perhaps 20 or 30 times as much to market it successfully. The Department of Trade and Industry might consider helping some of our fledgling software companies to market in the United Kingdom and overseas.
  The Bill will help British information technology enormously. It is an important part in the jigsaw. If we could find the other pieces, it would lead to a vibrant prosperous industry in this country over the next 20 years. The British industry is a delicate shoot. More direction is needed, but not direction in the French sense of the all-seeing, all-powerful bureaucracy trying to control and mould every aspect of the industry. It needs a little more recognition of where our national interest lies, and a few prods in the right direction from the Department of Trade and Industry would be welcome. I recognise that it has already done a great deal to help the industry.
  The Bill is a small but vital step in the right direction. I warmly welcome it, and I warmly thank my hon. Friend the Member for Corby for taking such pains and making such efforts to ensure that it came before the House.
  11.56 am
  Mr. Timothy Wood: I should like to join all those who have offered their congratulations to my hon. Friend the Member for Corby (Mr. Powell) on introducing the Bill. When one comes high in the ballot it is always difficult to decide which of all the subjects of merit one should pursue.
  A change in copyright legislation is vital for the software industry. I should declare my past interest in the subject as, for many years before being elected to this this place, I worked for ICL in the development of computer software and advising people on the use of such software.
  The nature of computer software, as has already been said, has changed significantly. In the early days of computer use there were relatively few different computers, costing substantial sums of money. A few bespoke software packages were made and there was much greater tailoring activity. Over the years the cost of

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  computer hardware has fallen dramatically. It is an essential requirement that package software is produced that can be matched easily with many machines. That has the advantage of spreading development costs over large numbers of copies.
  As has been said by my hon. Friend the Member for Corby and others, there is an enormous potential for growth in the production of software. A figure of 22 per cent. has been mentioned. Whether that is accurate will depend in part on the Bill's passage. There is no doubt that the development of good quality software depends upon good profits being made from it.
  It is relatively easy to produce software cheaply and quickly, but if we are to produce the software that will provide effective systems for users, or good games for children and others, substantial efforts will have to be made. If there is piracy, the value of those efforts is destroyed.
  Therefore, although in the short term it may appear that the passage of the Bill would aid the computer software industry, in the slightly longer term the real beneficiary would be the user. Whether the user be the child playing the fun computer games or the large company operating a major stock control system, if there is not the incentive, through good returns and good profits, to develop expensively the software that is necessary, inferior products will be the type available to all. That is the growing danger.
  In the computer world there have been planted a considerable number of seeds of computer software, and we are seeing them grow. The danger is that there is also a parasite that is growing quickly. It may stunt the growth of individual items of software and damage the quality of those that are produced. I believe that the Bill will help to end that blight.
  There are substantial differences in the nature of software and software sales for differenct types of machines. With home games it is ludicrously easy to copy cassettes containing such games; indeed, even where the manufacturer endeavours to protect his software when it is loaded on to the computer, it is possible to copy the software by using an audio cassette system. By that means an identical version is produced through an electronic or audio machine, thereby overcoming the efforts that the manufacturer has made to protect his investment and his users' interests.
  With regard to business microcomputers, as has been said, most of the software is distributed on floppy discs, and that software can be copied from disc to disc in a matter of moments. I have seen attempts made to protect such software and there are suitable means that can be used, but sometimes those very means can be a confounded nuisance to the genuine users of software. I know of instances where a manufacturer of software has put in date locks so that, unless the user of the software returns to the manufacturer after a year or some such time and gets a special modification, the software ceases to work. It is a good way of preventing the illicit use of such software, but the confusion that can be caused to the legitimate user, if there is some failure in communication, can be enormous. Therefore, whenever a manufacturer endeavours to provide protection, he may well be making life more difficult for the valid user.
  With the most expensive forms of software, distributed on large mainframes and so on, there are different realms of complication. Today most packages are built in modular
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  form, and the manufacturer will endeavour to use some of those modules in his packages. It was said earlier that there is not too much sophisticated copying taking place. That is not so, because there is an advantage to be gained by a software thief in taking some of those modules and incorporating them into another package that the rival manufacturer may be producing, thus saving money and enabling the rival to develop a series of packages at a cheaper rate simply because he has been saved the cost of some of the essential modules. I hope and believe that the Bill will enable that sort of abuse to be dealt with. It is an essential requirement of any legislation.
  There have been comments about the use of the terms "computer programme" and "computer software". I hope that the promoter of the Bill will resist any attempts to change the term "computer software". Among its other merits, the Bill has the merit of clarity. The intention of the Bill is clear in meeting a particular problem. The Copyright Act 1956 is the appropriate measure to be amended, and in extending that Act to enable it to cope with a new and developing problem we are taking the most effective legislative action that we can. I congratulate the promoter of the Bill and hope that it will have a speedy passage through the House.
  12.7 pm
  Dr. Jeremy Bray: The Bill is a useful and necessary measure, and, on behalf of the official Opposition, I hope that it will complete its passage through the House at the earliest opportunity.
  I congratulate the hon. Member for Corby (Mr. Powell) on drafting and producing the Bill and on his comprehensive exposition of the industry's problems and the way that the Bill will address them. The Bill does not, of course, deal with all the problems of copyright in what is a very complex and rapidly changing technological field. Still less does it tackle all the problems of the software industry, but the hon. Gentleman did not claim that it did.
  There is the converse problem of securing standardisation of software. In terms of the propagation of the use of computers and applications for computers that is extremely important, but there is no sense in which the Bill conflicts with that area. Indeed, a proper protection of copyright is a necessary part of the securing of standardisation. The necessarily complex operating systems that can be used to secure standardisation and portability themselves need to be properly protected by copyright.
  The Bill cannot solve all the problems of electronic publishing—a matter that was mentioned by the hon. Member for Arundel (Mr. Marshall). It cannot cover questions of copyright of data bases or data banks which, presumably, can range from the design of a jet engine to the design of a microcircuit, the on-line access to all the United Kingdom company accounts in Companies House, the complete set of laws of all industrial countries, or whatever may be the data bases that are available now or may come to be available in the future. That is the whole area of copyright and electronic publishing, and the idea of sweeping up all that in a private Member's Bill is not only impracticable but outside the long title of the Bill. Therefore, it could not be dealt with during the passage of the Bill.
  The best service that the Opposition can do for the Bill and, indeed, for employment in that vital industry and its

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  future development, is to facilitate the Bill's progress both on Second Reading and in the remaining stages. Speaking personally, I should have no objection to the Bill completing its remaining stages today and would not seek to block that, if it was the wish of the hon. Member for Corby.
  We have had no representations against the Bill, nor any representations seeking amendments to it. If we receive any representations or objections to it, we shall certainly see that they are pressed in another place. I believe that the Under-Secretary has had no objections to the Bill, either. If, when the industry reads the debate and realises the progress that has been made, it were to raise any questions or propose any amendments from outside the House, I hope that the Under-Secretary would consider them carefully before the Bill went to another place.
  Out of consideration for the progress of other private Member's Bills—we understand the natural pressure of time—and as the Bill is supported on both sides of the House and no objections have been raised, my best service is simply to commend it to the House and sit down in the hope that it will secure a speedy passage.
  12.12 pm
  The Parliamentary Under-Secretary of State for Trade and Industry (Mr. John Butcher): I thank all hon. Members on both sides of the House for the contributions that have been made in an excellent and informed debate. I am sure that you, Mr. Deputy Speaker, will join me in noting the unanimity in the House. I think that it is no exaggeration to say that in the House the Bill has no enemies. Suffice it to say that outside the House we cannot detect a lobby that has attempted to counter the arguments put forward by the Federation Against Software Theft and, in fairness, by several companies and individual associations that wish to protest and do something about software theft, which is what we are discussing today.
  I do not think that "theft" is too strong a word. We are talking of the theft of intellectual property, the loss of revenue to those who rightfully can expect to accrue benefit from their intellectual effort. Therefore, I join hon. Members in congratulating my hon. Friend the Member for Corby (Mr. Powell), and my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell), who set the scene for today's events.
  My hon. Friend the Member for Corby reminded us of the $61 billion turnover of the industry. He talked about the $12 billion turnover in western Europe, which illustrated vividly the burgeoning growth of and significant contribution made by information technology, particularly the software industry. I shall refer later to some other figures that illustrate the point that my hon. Friend made, but in a particularly British context. Those figures come from the Computing Services Association and prove yet again that the industry is growing at geometric rates and seems to be immune from the problems which, tragically, affect other industries in terms of recession and recovery. Worldwide, we are looking at a growth of about 20 per cent. per annum, consistently, remorselessly, and with great effect.
  My hon. Friend reminded us of a significant report published by the Information Technology Advisory Panel. I remember that report with considerable affection. There
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  were times when I felt that there should have been a slightly more vigorous response to its recommendations. It stated that information and the information industry are of great significance, and that of itself information is a product. It can be assembled, bought and sold; one can add value to it, and one can import and export it. It is one of my objectives, and indeed one of the objectives of my Department to ensure that all the measures and policies required to make London the international exchange for information in this respect, as it is currently the international exchange for financial services, should be invoked and encouraged by hon. Members. It is the new entrepot trade of the final years of the 20th century and the early years of the 21st century. We in the United Kingdom are particularly equipped with the talents to make a major contribution and, indeed, to earn major revenues on the international market in information trade.
  Therefore, as my hon. Friend and others have reminded us, the Bill is a legitimate measure to underpin, with an appropriate protective mechanism, the continued growth of the information trade, and the interests of the United Kingdom information and software providers in particular. Not only do we want London to become the world's information exchange; we should also like to see the rapidly growing business in value-added network services continue to grow at that rate. The business is still in its infancy, but I believe that it will be a major provider of wealth and, indeed, jobs. However, again those people need the protection that is contained in this measure.
  I welcome the support and contribution of the hon. Member for Yeovil (Mr. Ashdown). I know that he is pressed for time today, so I appreciate his courtesy in returning to the Chamber and participating in the latter stages of our debate. I have already endorsed his observation that copying is theft. It is the stealing of intellectual property.
  My hon. and learned Friend the Member for Mid-Bedfordshire reminded us of the path that he trod in earlier months and the intellectual wrestling that he had to undertake to establish that the House would welcome a measure under the ten-minute Bill procedure to protect our software authors and houses. I join hon. Members on both sides of the House in commending that trail-blazing work of my hon. and learned Friend.
  My hon. Friend the Member for Arundel (Mr. Marshall) raised several points that I should like to deal with later in the debate. Like my hon. Friend the Member for Corby, he rightly said that there has to be an international dimension to the debate. Of course, we wish to consider how we monitor and assess the progress of our industry and the pressures that may damage it. As my hon. Friend the Member for Arundel said, we are aware that the industry still could do several things to help itself. However, as a result of the activities of FAST, the Federation Against Copyright Theft and other organisations that have fought this battle, we see the trade associations in the industrial sectors coming together to counteract the increasing, but—I hope soon—decreasing threat of theft.
  My hon. Friend the Member for Basingstoke (Mr. Hunter) forcefully fought on behalf of the interests of the industry and his constituents. That is the happiest combination of circumstances to which an hon. Member can hope to be beholden. I take his point that in one company alone that is strongly represented in his

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  constituency there is concern about the £10 million loss per annum through software theft. That supports the view that there is a significant problem.
  My hon. Friend the Member for Amber Valley (Mr. Oppenheim) made one of his coded speeches which was based on remarks, which are as perceptive today as they have been on previous occasions, concerning the international trade barriers against telecommunications products. I assure my hon. Friend that the Department of Trade and Industry is aware of the problem. No doubt my hon. Friend will continue to pursue his campaign through questions, and I hope that I shall be able to allay his anxieties. We are anxious to see a free and fair market in telecommunications products. That is not the subject of today's debate but may I, en passant, mention that I have endorsed my hon. Friend's line, not least in Dusseldorf when I pointed out in a recent speech that it was easier to sell telecommunications products in Detroit than in Dusseldorf. We need to see a true common market in those products as soon as possible.
  My hon. Friend made an excellent point about the need for help with marketing. The Department of Trade and Industry has a legitimate role here. As I have said before, I should be delighted if the information technology industry, particularly the smaller companies and the software houses, were to take greater advantage of the market entry guarantee scheme which can provide up to £350,000 worth of help in meeting the costs of gaining access to a market which are crucial for a new small growing company that has to go through the pain barrier of gaining access to such markets. I have put that on the record again. I cannot make the invitation more vividly than I have today. No doubt my hon. Friends will draw that to the attention of companies in their constituencies whose interests we seek to support.
  The hon. Member for Yeovil said that he hoped that the House would have an opportunity shortly to discuss the licensing of software items for export. That is a matter for the Leader of the House, and I have nothing to add to what my right hon. Friend the Minister for Trade told the House on 8 February. In the meantime, I commend to the hon. Gentleman, who is, shall we say, worldly in matters of security and strategic considerations, an excellent book about the KGB which contains a magnificent chapter on the huge resources that the KGB deploys internationally through front and other organisations to obtain software and hardware which Russia can make use of in its armaments and industrial programmes. It makes for stimulating, if not terrifying, reading.
  Mr. Ashdown: Is the Minister referring to that seminal work "Techno-Bandits"?
  Mr. Butcher: No; I am referring to another book which I bought at York station only two days ago. I am desperately trying to remember the name of the author. I think that it is a chap called Baron. It certainly gives an interesting insight into the efforts made by the KGB to obtain information in this area.
  Mr. Ashdown: I must obviously buy that book as I pass through Waterloo in 20 minutes. "Techno-Bandits" is another excellent book which deals with the same subject. One of the points that is most powerfully made in it is that it is the nature of the attempt to apply licensing provision universally which makes the system so leaky that the KGB can get in and lift out all the secrets that it
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  wants. A more appropriate licensing system which would be easier to police would be tighter in its definitions that that which is now proposed.
  Mr. Butcher: I am grateful to the hon. Gentleman for making that point. As I said earlier, that is not the subject of today's debate, but I should like to take this opportunity to join the hon. Gentleman in that objective. It may be that in the detail of our wish to achieve it we differ tactically, but I hope that the hon. Gentleman will not be embarrassed on a future occasion if I were to remind him of his words today.
  We share a mutual anxiety that behind the whole COCOM debate and the rather hysterical observations that have been made there is a serious problem. But we must look after United Kingdom interests, both industrial and commercial. I hope that that will not be done in an atmosphere of naivety on the part of some our domestic companies. Perhaps today we can exhort them to read that same section, if not the whole book, in "Techno-Bandits". No doubt we shall return to this matter on another occasion.
  My hon. Friend the Member for Arundel asked for a comment on a possible international convention on software protection. He may know that a joint study is proceeding in the World Intellectual Property Organisation and UNESCO on the legal protection of computer software. I believe that as part of that study there is to be a meeting next week in Geneva. Although the possibility of a new international convention has been considered in that study, I understand that that, is not the direction in which it is currently moving. There is a wide international consensus that copyright is the right vehicle for protecting software, and there is a widely held view, which I share, that the existing international conventions on copyright — the Berne convention and the universal copyright convention—are the appropriate international vehicles for protection.
  There is a need for further study internationally and that is proceeding. No doubt my hon. Friend's observations will be noted in the appropriate quarters. Through my right hon. Friend the Minister for Trade and others we shall consider whether our input into that process should be a little more pointed.
  My hon. and learned Friend the Member for Mid-Bedfordshire suggested that the Bill might be amended to deal with the broader questions of electronic publishing. Reference has already been made to the comprehensive review of copyright currently being undertaken by the Government. An important consideration that arises in that context is the need to introduce a modern law of copyright that is capable of dealing with the present and future state of technology. The impact of electronic publishing is clearly an important element in that. I can assure my hon. and learned Friend that when the Government introduce their plans for a coprehensive copyright reform great care will be taken to ensure that they are appropriate to deal with advances in technology.
  Mr. Michael Marshall: My hon. Friend is answering questions that I put to him, but my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell) made the same points. I am obliged to my hon. Friend for what he has just said. In the light of that assurance, I make it plain that I certainly would not wish to delay the passage of the Bill. Any suggestion that I may have made about an

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  interest in tabling amendments in Committee I am glad to withdraw in the light of his assurances. I want to ensure that the Bill reaches the statute book at the earliest possible moment. Any day that is saved in that process will significantly save jobs and the basis of British industry.
  Mr. Butcher: No doubt the whole House will note my hon. Friend's comments. I should also correct the record and credit him with the very perceptive question that I answered earlier. He also raised the Australian issue and the international massaging of programmes for re-export.
  Copyright protection covers not just authorised reproduction of a complete work, but the copying of a substantial part of the work. Thus, if a computer programme is copied in the manner suggested by my hon. Friend sufficient of the original programme is likely to be contained in the copy for it to be an unauthorised copy under copyright law. The copyright law cannot be avoided by making small and insignificant changes to a copyright work, even if the work is imported and the changes were made overseas. This will apply to computer programmes as much as to any other work.
  On behalf of the Government, therefore, I welcome the Bill. It is particularly welcome in view of the importance we attach to encouraging the software industry in the United Kingdom. The Bill will provide the protection needed by the creators of original computer programmes to ensure continued development and expansion of this successful sector of the information technology industry.
  A number of hon. Members have reminded us that there is growing concern about the scale of software piracy both in business software and in computer games. When I talk about piracy, I am thinking of those people who make unauthorised copies of computer programmes and then sell them, thereby threatening the livelihood of legitimate producers and dealers. The success of any industry is underpinned by protection from unfair competition and the software industry is no exception.
  It is difficult to be sure about the exact scale of software piracy, but it is clear that a significant problem exists. I also believe that piracy could pose a real threat to the software industry if not acted against now. The amendments to copyright law contained in the Bill will go a long way towards helping the software industry to combat this growing threat. The Government are therefore glad of an opportunity to support the measures in the Bill and thus to prevent piracy getting out of hand.
  A number of hon. Members referred to the relationship between the Bill and the broader implications of copyright law and future attempts to bring together some of the pressing copyright issues currently outstanding. Copyright law essentially provides an author with protection against unauthorised copying of his work. To attract copyright protection, the work must be original. Another important feature of copyright law is that registration of a claim to copyright is not required. The protection commences automatically as soon as the original work has been created. It does not depend on publication or any other form of public exposure of the work. Various categories of work can attract copyright protection—for example, literary works, artistic works, films and sound recordings.
  The protection provided by copyright law is given by the Copyright Act 1956, which gives original literary works protection against unauthorised copying and various
  1366
  other acts such as publication and adaptation. Protection is also given against trading — for example, selling, importing or exhibiting copies of a work known by the trader to be infringing copies. It is established that the term "literary work" includes such mundane items as street directories and railway timetables.
  In the enforcement of copyright, both the civil and criminal arms of the law can be brought into play. The civil remedies are available to a copyright owner suing someone whom he detects to be infringing his copyright. They include injunctions, which can often be used very effectively to stop unauthorised copying of a work subject to copyright. There is also the possibility of damages, which the courts will award after taking into account the seriousness of the unauthorised copying. It is clear that the damages awarded could be extremely high if a copyright owner has suffered seriously at the hands of a person involved in large scale piracy of his work. The civil remedies can therefore be used very effectively by many copyright owners to deal with the majority of cases of copyright infringement.
  I should stress that the Government believe that copyright should in general be enforced by the use of the civil remedies as I have just described. The criminal remedies are important, but they can only be viewed as a last resort. The civil remedies are, in any case, more comprehensive since they can be used against any unauthorised copying, not just where the copying is done for commercial purposes. The criminal remedies, on the other hand, are available only against a person who makes infringing copies for sale or hire or who trades in infringing copies.
  It is, however, right that the criminal remedies should be used in cases where the seriousness of the offence justifies this approach. However, other than for offences involving copyright films and sound recordings, it is true to say that at the moment the criminal remedies under copyright law are very seldom used.
  In 1981, the Government published a Green Paper entitled "Reform of the Law Relating to Copyright and Performers' Protection", Cmnd. 8302. There we indicated the intention to strengthen the criminal measures under copyright law. In particular, an increase in the scale of penalities to deterrent levels was proposed. In due course, we intend to introduce increased penalties for all categories of copyright material in a comprehensive copyright Bill.
  I come to the detailed provisions of the Bill. I shall consider its two distinct aspects separately. First, there is the intention to make clear provision for the protection of computer programmes by copyright. Although it is widely believed that copyright protection under existing law already extends to computer programmes, there is some doubt about the matter. It was precisely that area of doubt that my hon. Friend the Member for Corby illustrated so vividly and successfully in reinforcing his argument for the Bill. After all, computers were in a very early stage of development when the Copyright Act 1956 was drafted, so it is hardly surprising that copyright law does not specifically mention how computer programmes are to be treated. The courts have not resolved the matter, so some doubt remains.
  Under the Copyright Act 1956, making an unauthorised adaptation of a literary work is an infringement of the copyright in the work. The Bill, by giving computer

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  programmes the same copyright protection as is currently enjoyed by literary works, therefore presents an opportunity of clearing up a few crucial definitions.
  The second aspect of the Bill concerns penalties and enforcement — matters that are obviously of great importance to the software industry. Naturally enough, the industry has seen the dramatic effect of recent changes to copyright law in reducing video piracy, and now seeks similar changes to deal with the piracy of computer programmes. Indeed, one or two commentators feel that those who exploited the video piracy market but who now find it difficult to do so, may be the same people who see similar opportunities in this market. Perhaps we need to protect this industry from those self-same individuals who wish to make another killing. So the Government support these changes to deal with piracy in this new area before it becomes an even more serious problem.
  As I have said, the current level of criminal penalties under copyright law is generally low. All offences are triable only summarily and the maximum fine is £400 with the option of up to two months imprisonment. The Bill will have the effect that the more serious offences of making for sale or hire, importing by way of trade or distributing infringing copies of computer programmes knowing them to be such will become triable either way. On conviction on indictment, an unlimited fine and/or up to two years imprisonment will apply. Less serious trading offences, such as selling, hiring, exhibiting or possessing infringing copies of computer programmes knowing them to be such, will remain triable only summarily with a maximum fine of £2,000 and/or two months imprisonment.
  The Bill will also give the police the power to enter premises in order to search for and seize evidence of a copyright offence involving computer programmes, upon the issue by a magistrate of a warrant to do so. A warrant may be issued only if the police satisfy the magistrate that there are reasonable grounds for believing that one of the more serious offences has been or is about to be committed. He must also be satisfied that there are reasonable grounds for believing that there is evidence on the premises that the offence has been or is about to be committed. Thus, the police powers to deal with piracy of computer programmes will be introduced with the same important safeguards that already apply to video and record copyright offences.
  The Bill will give the police powers of entry, search and seizure. I must add a reservation about these additional powers. It must be for individual chief police officers to determine the priority that they can assign to these powers, and they can normally be expected to allow police involvement only where there is some evidence of a link with serious, large-scale or organised crime. As with video piracy, it is essential that the trade should undertake the bulk of enforcement work. I know that this has been accepted by the industry, mainly through the Federation Against Software Theft. I am glad that its commitment to fighting piracy of computer programmes will complement the important provisions in my hon. Friend's Bill.
  I stress that the Government see the Bill only as an interim measure to deal with the immediate problem of uncertainty as to the copyright protection available to computer programmes, and to halt the growth of software piracy. Wider reforms are needed in copyright law which must await the introduction of a comprehensive Bill. Nevertheless, the Government welcome and support the Bill of my hon. Friend the Member for Corby. We
  1368
  congratulate him, and we give the Bill our wholehearted support. My hon. Friend will be able to guide the House on how he wishes to proceed today, in the light of the many comments that have been made.
  12.41 pm
  Mr. Robert Rhodes James: This is the first occasion, Mr. Deputy Speaker, that I have caught your eye since your knighthood. That honour gave pleasure to hon. Members on both sides of the House.
  I warmly welcome the Bill presented by my hon. Friend the Member for Corby (Mr. Powell). Cambridge is the father of the computer industry. The area's prosperity is based upon high technology. The Bill is overdue and welcome.
  I declare an interest as an author. I enter one caveat. When we consider legislation we must remember that copyright is of value only if it has international strength. The international copyright convention is more important than a change in our own law. The current copyright law victimises certain scholars who wish to make quotations because they have to go through such a long process. I hope that my right hon. and hon. Friends will consider those two crucial points.
  When I was elected in December 1976 to represent Cambridge, the Cambridge science park consisted of one building, and fewer than 40 people were employed there. The park now comprises 40 companies employing 1,400 people. That is as good an example as any of the crucial link between research, science, industry, jobs and prosperity. An important element in that prosperity has been built in Cambridge, as elsewhere, on the remarkable development in computers.
  Until my hon. Friend the Member for Corby introduced the Bill, there had been no real protection for the brains, initiative and research lying behind the software industry. Although my hon. Friends will have to address themselves to the Bill's international application, the Bill is welcome to me, to my constituents and, in many ways, is overdue.
  I was glad that my hon. Friend the Under-Secretary responded to the important point raised by my hon. Friend the Member for Arundel (Mr. Marshall). My reservations about the Bill are not a criticism of my hon. Friend the Member for Corby or his Bill—they represent the fact that we are dealing with a rather larger subject than can be dealt with briefly in a short Bill.
  Mr. Lyell: My hon. Friend has made the excellent point that some of the anomalies in our existing copyright law are impinging upon scholars and those involved in the work of highest scholarship. Is he aware that as a result of changes through the courts, copyright protection is now given even to the drawing of a washer — and an old-fashioned washer at that?
  Mr. Rhodes James: I am constantly amazed at the wisdom and the variety of standing of my colleagues. I was not aware that an ancient washer is covered by copyright, so I shall now leave the House a wiser person.
  I warmly welcome the Bill, with the reservations that I have expressed and which go beyond the Bill. I hope that the Government will give it all assistance on to the statute book.
  12.46 pm
  Mr. William Powell: With the leave of the House, Mr. Deputy-Speaker, I shall reply to the debate. During the

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  past three hours many generous tributes have been paid to me. I thank the House for its courtesy in listening to my very long opening speech and I thank hon. Members for the generosity of their remarks about me—which were largely undeserved. It was my good fortune to emerge towards the top of the ballot, and to be given the opportunity to introduce this Bill.
  The last two or three months have been very rewarding while I have tried to get myself into a position to present the Bill with some degree of confidence. It is not an exaggeration to say that the day before the ballot was held I was aware of the word "computer" and had heard people talking about software, but about either or both of them I knew little else. I am privileged to introduce this Bill and I am grateful to everyone both within and without the House who has helped me. Without the efforts of so many people it would have been impossible to have reached this stage today. I know that that point will be recognised in the industry.
  The hon. Member for Yeovil (Mr. Ashdown) was right to refer to piracy as a cancer. That is as good a description as any of what has been going wrong in the software industry during the past two years. I hope that when people outside the House debate the implications of the Bill and the future of the industry they will bear in mind the essential truth of the hon. Gentleman's description of this pernicious disease that has been eating away at the prosperity of the industry of the future. No better description has been given. It is a cancer that we must do everything possible to eradicate, and the first step is the passage of this measure.
  I thank hon. Members for the manner and style in which they have welcomed the Bill. We listened with care to the remarks of the hon. Member for Motherwell, South (Dr. Bray), and I am sure that his comments will be reflected in the future passage of the Bill.
  I am grateful for the generous welcome that the measure received from the official Opposition and from the spokesman for the alliance, the hon. Member for Yeovil, and for the manner in which my hon. Friends—many of whom know much more about the subject, from years of experience, than I do—welcomed it and wished it speed through Parliament. I am sure that their words will have been noted carefully.
  My hon. Friend the Member for Stevenage (Mr. Wood) was right to emphasise that the greatest advantage of the measure will be to the consumer. The weakness in the market today is that, because there is no reliable protection against piracy, the consumer, the user, is getting a substandard product. It is not substandard in the sense that video material used to be substandard. In that case the sharks and criminals made appalling copies and sold them at rip-off prices, so that the consumers bought a product that was inferior in quality.
  In this case the consumer gets a first-class product in terms of quality of reproduction, but an inferior work. Instead of using software—my hon. Friend the Member for Arundel (Mr. Marshall) spoke of how this particularly applies in education — to produce, say, a first-class textbook, which provides an excellent means of using computer software to develop the mind and open up
  1370
  educational advantage and so on, the consumer gets a product which is beautifully produced, with, no doubt, excellent reproduction, but which is, in its intrinsic material, thoroughly substandard and second-rate. If we can reverse that process, the consumer will be the first to gain.
  Mr. Wood: I emphasise the point that my hon. Friend has just made. I disagreed with the suggestion of my hon. Friend the Member for Amber Valley (Mr. Oppenheim) that the development of software was a relatively cheap operation. Some packages can cost hundreds of thousands of pounds, and some can even cost well over £1 million, to develop. What incentive is there for developing such software if, within a few months or even weeks, it can be reproduced for a few pennies?
  Mr. Powell: My hon. Friend is right and I cannot emphasise the point with greater clarity and force.
  I warmly welcomed the Minister's remarks and I will comment on only two aspects of law enforcement. First, it is the intention that in future the law should primarily be enforced through civil remedies. There is no intention on the part of the industry to use the magistrates courts as a first strike weapon to enforce the law against commercial piracy. However, this law will make it much easier to go to the civil courts for civil remedies.
  Secondly, because it is uncertain whether copyright law applies to a software product, enforcement of the civil law is chancy and colossally expensive. We should not tolerate that situation any longer and the Minister was right to emphasise that civil remedies will be much more effective as a consequence of the Bill.
  The back-up power will be the availability of the criminal courts to deal with outrageous criminal cases. Those powers have been necessary in the video market. I hope that we are acting with sufficient speed to ensure that the criminal network that undermined the video market will not have penetrated computer software as deeply.
  The Federation Against Software Theft will set up a unit to monitor what is happening. It will collect evidence of criminal conduct, including offences against the copyright laws, the conspiracy and forgery laws and the Theft Act — for handling and receiving stolen goods. That unit will hand over the evidence to the police who will decide whether the case merits further investigation.
  There is no intention that a substitute police force should be established. Nothing could be more damaging to this country's long-term interests than to allow rival police organisations to be set up. The monitoring unit will do no more than present evidence to the police, who will allocate their resources in the proper way, as they do in the ordinary course of their work. I have put that on the record so that everyone knows how it is intended to proceed in that matter.
  I am grateful for the kind comments of hon. Members and for the welcome given to the Bill. I am also grateful for the assurance that it will be given a fair wind through the House.
  Question put and agreed to.
  Bill accordingly read a Second time and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).

  Hospital Complaints Procedure Bill
  Order for Second Reading read.
  12.52 pm
  Mr. Michael McNair-Wilson: I beg to move, That the Bill be now read a Second time.
  The Bill springs directly from my own experience in hospital since I was taken seriously ill in January last year with kidney failure. From the months of hospitalisation that followed came the patients' charter which I published in September and from that has come the Bill, which seeks to implement one of the charter's main proposals.
  The charter's object was to enhance the status of the hospital patient and to encourage the medical staff — doctors and nurses—to recognise the individual needs of patients and the fact that each patient is a unique human being.
  Sometimes during those long days in hospital I felt more like a case history than a person. The doctors had diagnosed my illness; they reckoned that they knew how to treat it, what drugs I required and so on. Every day, they took blood tests and no doubt everything was despatched to the laboratory for analysis and computer readouts.
  But what of me, the individual, lying in the hospital bed? I was like every patient who has just found himself in hospital, uncertain and anxious, worried about what is really wrong with him and worried about the future the treatment that he might have to endure. The patient will probably be worried about the support that his wife and family may get at home and uncertain as to whom he should turn to for help and advice. Perhaps one would expect that beside every hospital bed there might be a leaflet to allay some of those fears. I never found such a leaflet beside any of the beds in which I lay in no fewer than three different hospitals during the course of my illness.
  Information about the hospital services that are available — times of meals, visiting hours and church services — should be available to any new patient, especially to one as anxious as I was. There should be guidance on how to make a complaint if such a necessity arises. There should be something about sickness benefits, benefits to which one's family is eligible, the library service and on all areas of service in a hospital that impinge directly upon the patient and about which he or she should know. The fact that no such leaflet existed in the three hospitals in which I was a patient—one was a large London general hospital and the others were in Reading and Oxford — shows that hospitals are not thinking as carefully as they might about their patients. It is for that reason that I am introducing the Bill.
  It is true that a piece of paper with details about services is not all that a hospital patient requires. I was treated wonderfully by both doctors and nurses over the many months that I was a patient. Of course, the patient who is lying in a hospital bed is anxious about his condition. He will wonder about the future and be concerned about the treatment that he will receive. Patients are lying in alien surroundings and they have probably never met those who are to look after them. They will have no contact with them, at least initially, and, alas, perhaps no sense of trust and confidence.
  Nurses still remain the gentle and kind angels that we want them to be, or at least that can be said of 99·9 per cent. of those who treated me. Nurses still know how to
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  give patients assistance at moments of stress. If a nurse holds the patient's hand at that moment, it is worth more than its weight in gold.
  Doctors, by necessity, are more awesome characters. If I had not been fortunate enough to be the son of a doctor I think that I would have been more browbeaten by them. I had the advantage over many patients lying in hospital because I knew something of the medical profession whereas they did not.
  I have detailed patients' anxiety and sense of concern about the future and I have discovered that these feelings are not peculiar to me. After I published the patients' charter I received a vast amount of mail from all over the country. I received letters from ordinary people who found in my words an expression of their feelings. It is because I believed that I had struck a raw nerve, or a real issue, that I considered it worth while pursuing the charter into legislative form, if that was possible. Therefore, I count myself fortunate to have been drawn No. 12 in the ballot. I have been even more fortunate to find that the Department of Health and Social Security realised that there was something wrong and offered me its services in framing the Bill.
  Some will suggest that contact between doctors, nurses and their patients is not all that it might be because the NHS is now treating more patients than ever before and that patients are in hospital for shorter periods than ever before. The time span is so limited that the opportunity for nurses and doctors to get to know their patients is much more limited than it was. Perhaps the amount of work done by doctors and nurses precludes their developing an effective bedside manner. Some of the doctors told me that if they did not have so much paperwork to do they could spend more time on the wards. We should take their point on board. Sometimes I wonder why a secretary is not available to help doctors get through work that could as easily be done for them as by them. Some of the older doctors were much more willing to stop and talk and to answer questions and allay fears.
  Although most nurses brought that sympathetic touch of caring and gentleness that we expect of them, some bustled past, apparently bitten by the concept of patients as case histories who had to be fed drugs and not much else.
  Lying in my hospital bed, I wondered whether something could be done to improve matters. I shall refer to my experiences, not to impress the House with the fact that I have had a fairly rough time but to show the type of mistakes that can be made in dealing with anyone lying in hospital. I am grateful for the fact that, throughout my period in hospital, no one said, "He is a Member of Parliament. We must give him gold-plated treatment." I never asked for, and I believe that I never received, such treatment. I hope that the fact that I speak as highly as I do of the NHS speaks volumes.
  I remember a bad moment after an early dialysis treatment, which is not the easiest treatment to get used to. I felt pretty ghastly after the treatment and hoped that I was being taken back from the dialysis ward to my bed by means of one of those archaic wheelchairs that are still so common in hospitals. I was told that I was required in the X-ray department. I said, "I really feel very ill. May I just get my strength back before I go for an X-ray?" I was told, "Oh no, it is just on the way." I was taken into the X-ray department and I continued to complain about feeling ill. I was helped out of the wheelchair to stand

  1373
  against the screen, and I promptly fainted. I woke up to see many faces looking down on me more or less saying, "What on earth happened to you? How could this possibly be the result of our just wheeling you to the X-ray department?" When I was back in my hospital bed, I wondered how that could have happened. Surely someone somewhere should have said, "If he is not feeling well, it would be better to help him to get better and then X-ray him." To whom does one complain? Who comes to the patient and says, "We have made a mistake."? Does anyone really care, or is this just one more of the hazards of being in a hospital?
  The same question arose after I was asked whether I was sensitive to penicillin. I replied that I was and that my GP did not usually give it to me. At that time I had an infection, and I was given a pill, which turned out to be penicillin-based. I suffered the mother and father of a drug rash which, on its own, kept me in hospital for five weeks. When I went home I was in such a poor state that I needed a district nurse to come in every day to dress my feet. Afterwards, I asked, "I said that I was sensitive to penicillin; why did you give it to me?" The answer was, "Oh well, old boy, it was the best antibiotic for your particular infection and we thought that we could take the chance." Whose chance? Whose life? Whose body? Who is the sufferer? What is the compensation? What is the complaints procedure? There appears to be no such procedure. The patient is just the fall guy who is in the hands of doctors who think that they know better than the patient. The doctors did not feel that it was worth while picking up a telephone to ring my GP and ask, "He has told us that he does not get on well with penicillin. Is that really the case?"
  In another instance, someone left a stitch in my leg while removing something that was necessary for dialysis. The stitch went septic and I got septicaemia. I still have a wound in my chest as a result of that mistake. Again, to whom do I complain? Who will offer me compensation? Who will listen to my problem? Sadly, no one seems to want to take the blame.
  I do not believe that that is good enough. Those experiences of mine can be duplicated, triplicated and quadrupled throughout the country. Too many people who have written to me about my patients' charter have told me about the same type of mistakes and the problems that they too have suffered in hospital. No one comes forward to suggest that something could be done to alleviate those difficulties.
  In listing those experiences and the failure to find a complaints procedure that was adequate to meet them, I thought a great deal about how a patient's rightful needs should be met and what type of complaints procedure a hospital should have to deal with them. In my list of complaints I should probably include awkward relationships with the staff. Sometimes those will be inevitable because human beings clash with one another but sometimes there is a failure by the staff to recognise that a patient is the anxious human being that he or she is. There is bad food, mislaid property, dirty washing and lavatory facilities, poor communications between doctors and nurses and their patients, failure by the medical staff to advise and consult relations, a lack of communication between departments in the same hospital, causing unnecessary distress to the patients, and mistakes causing
  1374
  distress and suffering to patients. On the last point, there is a powerful case for some form of automatic compensation — a system of insurance for hospital patients to cover them against time off work, minor disfigurements through unexpected surgery, drug rashes and other minor errors. I know that someone will say, "What is a minor error, and what is a major or more serious error?"
  I do not believe that it is impossible for the Health Service to devise some form of limiting factor. I know that in a case such as mine, I have cause for compensation, but I also know that if I were to go through the present procedures not only would they be unbelievably drawn-out — probably covering years — they would cost me a fortune and I should probably obtain minor damages. I should have been able to take out an insurance policy when I first went into hospital. It could be devised in such a way that something would be available.
  Before we worry about compensation any further, and we should worry about it because the present system is extremely inefficient and long-winded, we should return to my first suggestion of a leaflet beside each hospital bed for every new inpatient—a short statement of what is available to him or her and how, if they wish to make a complaint, they can do so. I believe that that is a first step in an effective hospital complaints procedure. What is more, hospital complaints generally should be handled by a senior member of the hospital staff and not treated solely at ward level. That member of the senior hospital staff should be on a par with the consultant, the surgeon and the senior nursing officer. He should, in effect, be the hospital's ombudsman. To my mind, the unit administrator would seem a natural choice for that appointment. All complaints should be directed to that person. There are some who believe that complaints should not just be directed to a person in the hospital but should be reported to the district health authority.
  A member of the Portsmouth and South-East Hampshire health authority wrote to me about my Bill and said:
  "It must be a fundamental obligation of District Health Authorities and they should be required to receive regular reports on the response given by patients, both during their period of treatment and also after their discharge. This need not be an enormous bureaucratic exercise, but could be done on a sample basis. Quite frankly I would not be happy at simply relying on doctors and nurses to necessarily report the views of patients accurately. If I can quote one small example, recently in one of our district general hospitals in Portsmouth, we undertook a patient satisfaction survey of the catering services. Questionnaires were designed for patients to complete and the questionnaires were delivered to each ward with an explanation given by a member of the Catering Manager's staff to each Ward Sister on how and when the form should be completed. Several Ward Sisters were extremely diffident about the exercise and said that they would complete the forms on the patients' behalf because the patients were not capable of completing the forms properly. Fortunately the Assistant Catering Manager assisted and ensured that the forms were completed by the patients. Discussions with clinical staff are frequently as disappointing. All too often one meets the comment 'We really know what is best for the patient'."
  The person who sent me that letter goes on to say:
  "The sad thing is that the NHS is a marvellous institution and in terms of the commitment from the general public, it is extremely fortunate. It has got some fantastic staff who work for the real sense of commitment and dedication, and I think many of them who inadvertently fail to recognise patients' real feelings would be concerned and upset if they were really aware of the sorrow and anxiety that patients do suffer."
  It may be argued that some complaints of a very minor nature need not go through the complaints procedure that

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  I have suggested. I am not sure about that. Perhaps if somebody wants to complain about the lunch today or the supper tonight, that really is not a matter for the hospital ombudsman. But, generally speaking, I believe that complaints should go to that person in the hospital who is detailed to look after them. The consultant in the case of medical complaints, the senior surgeon in the case of surgery, and the senior nursing officer in the case of nurses, should be informed about whatever complaints have been made. I stress that I am talking about minor complaints.
  I return to the point that I have made several times before—that we must recognise that a patient lying ill in bed in hospital is an anxious person. That person will be nervous of making a serious complaint against a nurse or a member of the medical staff because of a fear of reprisals or that someone may be vindictive. That is why I believe that a third party is so crucial.
  I repeat that what is wanted is a member of the hospital staff whose responsibility is to follow up complaints for and on behalf of the complainant, and someone who is not frightened of running up against a senior member of the staff, doctor or nurse to ensure that the inquiries are completed satisfactorily — in effect, a hospital troubleshooter. To some extent I find myself in that extraordinary position.
  I have received letters from other patients in the hospital that I am currently attending for dialysis treatment. People that I have not seen before are bringing me their complaints and saying, "Since you are a Member of Parliament, will you do something for me?" I do what I can. It seems extraordinary to me that such people who are not my constituents feel that because I have the magic initials after my name, I can do something. In so far as I can, I do. If I tell my hon. Friend the Minister that members of the nursing staff have also asked me whether I can do something, particularly about the supply of laundry to the wards, he might realise that there is quite a task to be done to ensure that the complaints not only of patients but even of the nursing staff are properly handled.
  Of course, it may be said that while I am talking about patients complaining, there is no particular reason why the hospital staff itself should not go out of their way to discover whether there are complaints. I suggest that it would be no bad thing if doctors and senior nurses asked patients whether everything was all right, if they consulted relatives of patients to find out whether the patient had told them something that he had been nervous of telling nurses or doctors. Sometimes it is undoubtedly true that patients will tell their wives and those close to them about their worries, while they will hide those same worries from those who are looking after them. My correspondent from the Portsmouth and South East Hampshire health authority told me in his letter that the Harrow health care centre,
  "a small private Health Centre in Harrow",
  in his words,
  "hands out on a routine basis questionnaires to patients asking them fundamental questions like 'Did you like your doctor?', 'Did you have confidence in him?', 'Did you feel that he told you all you needed and wished to know?"
  If the Harrow health care centre can take that attitude towards its patients, I do not see why large general hospitals could not do something similar.
  From what I have said, I wish to underline that I am in rio way trying to suggest that going to hospital is a terrifying experience or that one will be badly treated or
  1376
  have endless grounds for complaint—in fact, quite the contrary. However, that mistakes are made I hope I have illustrated, and that patients have cause for concern is undoubted. If anyone wants to see the correspondence that I have received about my patients' charter, he is welcome to do so.
  I repeat that all of us can have the greatest respect for the doctors, nurses and domestic staff in our National Health Service hospitals. We can be satisfied, by and large, that they treat those in their care as well as they can. I suppose that what I am really complaining about is a lack of communication. I am also complaining about the fact that those who look after patients do not attempt enough to discover what the patient is feeling and so build up his or her confidence and help the patient to get better.
  However, as we all know, all human institutions have shortcomings and failings. I believe that a practical and easily understood complaints procedure common to all hospitals is badly needed. I am aware that some hospitals have already introduced a complaints procedure. I am particularly delighted to say that my own Newbury district hospital has produced an authoritative document. However, I have not been an inpatient in that hospital, so have not had the chance to try out its procedure. Nevertheless, I know that it exists, and that shows that some hospital authorities have thought about the subject and felt that something should be done.
  I believe that something on a nationwide basis is needed. Because it does not exist now, it is a serious omission from the effectiveness of the Health Service when it is applied to hospitals. Because I believe that the omission can be put right by the Bill, I commend it to the House.
  1.24 pm
  Mr. Nicholas Lyell: It is a privilege to follow my hon. Friend the Member for Newbury (Mr. McNair-Wilson), who after a period of suffering, which we recognise was real, is sitting here at least substantially restored to health as a result of the efforts of the NHS. He warmly expressed his gratitude to that service, yet in his duty as a Member of the House, having recognised that there are real shortcomings, has not been shy in bringing them forward to the House and the public.
  I endorse what my hon. Friend has said because many years ago I too had great reason to be grateful to the NHS when it repaired my detached retinas with great skill. I was off work for only two months and I suffered none of the difficulties that my hon. Friend suffered. But, having practised in the courts for 20 years and having done a significant amount of practice of a medical nature, I know only too well of the problems which he describes. I also know them only too well from, in a sense, the inside, because my father-in-law, Professor Charles Fletcher, has made a particular study of communications in medicine. Although he has now retired, he continues to lecture and he has published works on the enormous importance of those in the medical profession being able to communicate.
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): I hope that my hon. and learned Friend will accept that, despite his father-in-law's retirement, we remain grateful for the advice that we have had from Professor Fletcher and for the continuing advice that we receive from him.
  Mr. Lyell: I am most grateful to my hon. Friend.
  The medical profession is understanding more and more the importance of communication, but there is still a long way to go. It should be a requirement is every medical school that there is at least a significant period of formal training for young doctors as to how they should approach the patient. They should realise just how vulnerable a patient is, even if everything is done with the best of intentions.
  On a lighter note, but with a serious undertone, let me tell the House of a story told to me by my general practitioner about my former general practitioner who is no longer alive. He was the very best of doctors and would undoubtedly have done everything that he could to communicate. But when his successor took over a patient told him that she had finished the course of pills which had been given to her by the doctor's predecessor but that they did not seem to be working. She said, "I have been taking them exactly as he told me every 46 hours." A moment's reflection will show how that misunderstanding occurred and yet nobody would put it down to the fault of the doctor. Happily, the pills were taken every four to six hours for the following three weeks and began to have a rapid and beneficial effect!
  The undertone of that is that people are extremely lost and vulnerable when they enter a strange world. I remember feeling exactly the same when I entered hospital, although it turned out to be for only a comparatively short period. I remember having something explained to me and I was told that I had some "D" mark in my eye. I kept asked what "D" mark was. I thought that I was moderately well educated but I was not familiar with the medical expression "oedema". I was continually told that there was oedema which I picked up as "D" mark. That was a small hospital with the highest standards of treatment and the kindest communication. In enormous general hospitals, and in any hospital, there is tremendous pressure. People can feel much more lost and worried than many practitioners realise.
  I re-emphasise that my gratitude to the Health Service is colossal. The dedication of the staff—doctors, nurses, administrators and ancillary staff— in the face of all sorts of difficulties is real and noticeable. Against that background of appreciation, and drawing on my experience in the courts, I want to make another serious point to the medical profession which I hope will be noted, considered and acted upon. It relates to circumstances in which it is necessary to pursue and investigate a serious complaint which may lead to a claim for compensation.
  As the House knows, all doctors are required to be insured and I do not think that any doctor practising in the medical profession would be uninsured. The Medical Protection Society and the Medical Defence Union, for which I have had the privilege of acting on a number of occasions, exist to look after doctors' interests. The patient, however, is not insured and finds himself in an alien world. In theory, much has been done to improve the ease with which patients can get hold of their notes to pursue an investigation, but in practice it is still extremely difficult. Objections are raised to the patient seeing the notes, to more than one doctor seeing them or to their being passed to lawyers, as is essential if a case is to be properly regarded. It is said that the patient may suffer if he sees the notes, or that doctors will be less open if the notes are not completey protected, but I believe that such anxieties are exaggerated in the minds of those who express them. The risk to the patient is very small.
  1378
  Advisers, whether they be medical or legal or simply friends, will take care of the notes and not allow worries to be exaggerated. The notes should therefore be far more easily available.
  My second serious comment is that members of the medical profession are far too reluctant to come forward and give evidence when it is justified in negligence cases. It is extraordinarily difficult to persuade experts to give an independent opinion and, if necessary, to support it in the courts. Here I declare an interest as to some extent it is my pleasure and profit to act in such cases, although I have not done so for some time and it is no significant part of my current activities.
  It is wrong that a great and rightly privileged profession should not be prepared to see justice done in cases involving its own members. Such cases are often very complex and involve questions of judgment. Consultants and other specialists should not stand back from giving an honest and open opinion, if necessary backed in the courts, if that is the only way in which justice can be achieved.
  It is sometimes argued that the British Medical Association or the General Medical Council is reluctant to keep lists of specialits as that might constitute the advertisement of skills, but I do not believe that there is any merit in that argument, if indeed it is still around. I appreciate that it might be embarrassing for one practitioner to have to give evidence against another, especially in a narrow field in which they might be friends or colleagues, but the same problems arise for lawyers, architects, accountants, chartered surveyors, and so on, and in all my long experience I have not found members of those professions unwilling to come forward in an open and responsible way. In this respect, the medical profession falls short of what the public are entitled to expect and I hope that it will take serious note of my comments, which are made in a spirit of kindliness and great support for its members' professional judgment and skill and the benefits that they provide for the community.
  I turn to consider some of the specific points raised in the Bill. There is enormous merit in the setting up of a formal complaints procedure of exactly the type envisaged in the Bill. The fact that such a procedure exists and that it is open will help to overcome some of the problems, at a graver level, that might sometimes lead to litigation. I emphasise that I have no wish to see us follow the Americans into endless claims. Indeed, I know very well that my hon. Friend the Member for Newbury has no wish to see that.
  However, anxious patients who believe that they have a genuine complaint should have the opportunity to air it. In a high proportion of cases—I suspect in the majority of them—it will lead to the rapid reassurance that the profession would have wished to give if it had only known about the complaint. In the small minority of cases where the matter is more serious, justice can only enhance the profession's prestige.
  I warmly welcome and strongly support the Bill, and I hope that it will find a rapid route to the statute book.
  1.35 pm
  Mr. Frank Dobson: On behalf of the Labour party I warmly welcome the Bill introduced by the hon. Member for Newbury (Mr. McNair-Wilson). Although we have jousted almost personally on one or two issues in the past, I was delighted to be sitting on the Front Bench last year when he returned

  1379
  to the House. I think that we all welcomed his return, particularly as we had heard such horrifying stories about the nature of the things that had been wrong with him, and about the accidents that had happened to him while in hospital. I hope that it will not sound at all patronising if I say that it is inestimably to his credit that, on coming out of hospital and returning to work, he paid great tribute to the NHS and to those who had helped him. Unlike most of us, he was capable of distinguishing between what people had been trying to do and what had gone wrong.
  There can be no greater justification for private Member's Bills than that a Member of Parliament who has had painful and distasteful experiences should try to help others by changing the law. That is one of the perfect justifications for a freely elected Parliament. However, I hope that I am not being too party political if I say that when arguing against private medicine and in favour of the NHS, I always stress that one of the virtues of having everyone reliant on the NHS is that people in influential positions can get corrected something that has gone wrong. Conversely, if people in influential positions opt out of the NHS, things can go wrong without them even knowing about it.
  It is extremely commendable that the hon. Member for Newbury should have introduced this Bill. We shall seek to ensure that it gets through all its stages as quickly as possible, as we should like to see it enshrined in law. It is sometimes not recognised by those who theorise that patients in hospital are ill. That is why they are there. Those who feel ill are not usually feeling their best. If one is down, in pain, confused and vulnerable, when something goes wrong one is more disturbed than one might be at home, or even in the House of Commons.
  People in hospital are ill and vulnerable. Many patients are in awe of doctors and nurses and many are also affected by a sense of gratitude to all the people who are trying to make them well. As a result legitimate complaints are not voiced by patients because they feel that they would appear ungrateful or that they would be regarded as trouble makers if they drew attention to things that were not going right for them.
  We must make it easier for hospital patients to have their complaints dealt with properly. The exceptionally well informed hon. Member for Newbury found it difficult to put messages across when he was receiving treatment in hospital. Many patients are not as well informed and confident and are not the offspring of a doctor. They have enormous difficulties making their views known. We must ensure that there is a complaints system about which everybody knows and of which everybody can make use.
  I have something of an obsession about complaints procedures because before I came to the House I worked for the local government ombudsman and dealt with complaints all the time.
  People working in hospitals might be perturbed that Parliament should require a complaints procedure. There is no better way of describing the procedure than John Milton's immortal words:
  "when complaints are freely heard, deeply considered, and speedily reformed, then is the utmost bound of civil liberty attained".
  A good effective complaints procedure would be of advantage, not only to patients, but to people working in hospitals.
  It is probably best for people with a complaint to turn first to the person about whom they are complaining or the
  1380
  person who is responsible for that aspect of the hospital service. However, a procedure to log complaints is still necessary. I am not talking about the need for a formal procedure to roll into operation, but logging complaints is important.
  It is often difficult to complain to the person about whom one is complaining. It can be difficult if one is having a rough time with a nurse or doctor to say that one does not like what is going on. It might be easier to complain to someone else about the person who is causing the upset.
  A formal complaints procedure would be to the advantage of the people working in the hospitals. We should all learn from our mistakes. If a hospital is properly organised and logs all complaints, the complaints can be used as a tool of management to identify people who are square pegs in round holes, or procedures that lead to complaints. Improvements could be made, as a result of a complaint, to the physical layout of a ward or clinic. If the hospital management makes proper use of the complaints procedure, not only will that benefit the individual making the complaint, it will enable the hospital to provide a better service by identifying what is going wrong and putting it right.
  One thing that distinguishes our system of health care from that in the United States—to the inestimable credit of our system—is the absence of the massive amount of legal activity and litigation that prevails in the American system. Operations carried out by surgeons in the United States are described in some circumstances as defensive surgery — to defend surgeons against possible legal action if something has gone wrong. That is medical madness, and must be avoided.
  Mr. John Patten: I am extremely grateful to the hon. Gentleman—who for the purposes of this debate is my hon. Friend—for giving way. Is he aware that in some American hospitals the staff includes moral philosophers, who are employed by the hospitals to advise surgeons on the moral choices that they face before taking decisions?
  Mr. Dobson: They may be moral philosophers, but in line with everything else in the United States I suspect that they are concerned more with money than with morality. They are probably advising the surgeon that he will be safer in court rather than in the eyes of his fellow human beings or of whichever God he may subscribe to. It is more likely to be legal than moral advice.
  I firmly believe that the stronger and more effective the sytem of complaints procedures in our National Health Service—both in general practice and in hospitals—the less likely we are to get into the mad position of having lawyers shuffling all over the place. Lawyers are a desperate necessity and their services should be avoided almost at all costs. We do not want the position that prevails in the United States, where if someone wants to complain about a hospital he has to do it via a writ or a claim for damages. Such a system is to the advantage only of the legal profession, and certainly not to the advantage of the patient or the medical profession.
  As my constituency includes Lincoln's Inn and Gray's Inn, I may be risking a few votes at the next general election. However, I believe that the only proper place for a lawyer in a hospital is as a patient and not as a participant.
  I welcome the Bill because it will be to the advantage of patients and the majority of people who are working in

  1381
  the hospital service who want only to improve the services to patients. It will help those responsible for managing the hospital service to manage it better and will help keep the lawyers out of our system of health care.
  I hope that the Bill will go through all its stages today, get to the House of Lords and become law as quickly as possible. That will be a great tribute to the way that the hon. Member for Newbury has turned his experiences to the advantage of everyone else. We envy him that.
  1.50 pm
  Mr. William Powell: I fear that I must speak as a desperate necessity who is to be avoided at all costs and as one who should be in hospital as a patient. In the face of such an attack on myself and many others, I have a rare opportunity to speak about the Bill.
  Having nailed my colours firmly to the mast, I join in the congratulations that have been offered to my hon. Friend the Member for Newbury (Mr. McNair-Wilson). Hon. Members will wish him and his Bill every success. No hon. Member is better qualified to introduce such a measure, and he did so with experience, aplomb and true knowledge of the subject, having been through the system in the way he described. My hon. Friend deserves as well with his measure as any hon. Member ever has with a private Member's Bill. I say that in the knowledge that I have wished him even greater success than I would have wished on myself in the preceding debate, when I introduced my private Member's Bill.
  All hon. Members have experienced, through our constituents, circumstances which have made us wish that a satisfactory and reliable complaints procedure existed for hospitals. Constituents come to us with complaints about the way in which they, their families or friends have been treated in hospital. Sometimes those complaints are not justified; they are the product of a chemistry between two persons who have not been able to hit it off, with one side not having been able to accept the good will and status of the other.
  Sometimes, however, not just personal relations but the system fails. It is to remedy that defect that the Bill is designed, and for that purpose it proposes an important and necessary change. I have no doubt that it will not be necessary to resort to its procedures often, because the overwhelming majority of those who go to hospital—as patients or when visiting families or friends who are ill —have nothing but the highest praise for the nursing, consideration, courtesy and good will that the staff show to patients.
  Notwithstanding the desire of the hon. Member for Holborn and St. Pancras (Mr. Dobson) to send me to hospital as quickly as he can—though I must remind him that, having been called to the Bar by Lincoln's Inn in his constituency, I am affronted by his suggestion that I should be in hospital—
  Mr. Dobson: I interrupt the hon. Gentleman because he may have misheard me. I said that the only proper role for a lawyer in hospital was as a patient. I did not say that all lawyers should be hospital patients.
  Mr. Powell: I am grateful for that intervention. In view of the hon. Gentleman's good will towards the Bill, it
  1382
  would be churlish of me to insist on an interpretation of his words, which seemed to me to be consistent with his general drift. Therefore, I do not do so.
  This is a first-class Bill, introduced by an outstanding Member in the best possible cause. No Bill could be more warmly welcomed by the House. I welcome it unreservedly.
  1.55 pm
  The Parliamentary Under-Secretary of State for Health and Social Security (Mr. John Patten): The Government welcome the Bill, and I welcome the chance to speak briefly about our support for it.
  I pay tribute to the commitment and energy of my hon. Friend the Member for Newbury (Mr. McNair-Wilson), who has displayed his customary concern for others, in circumstances in which many others would have been concerned only with their own problems. The whole House admires his attitude. Everyone who has taken part in the debate has paid tribute to my hon. Friend, and I found his speech intensely moving and interesting.
  I echo the handsome compliments paid by the hon. Member for Holborn and St. Pancras (Mr. Dobson) to my hon. Friend the Member for Newbury, who has demonstrated his concern to maintain and improve the quality of services offered by the NHS. We all share that concern and all hon. Members who have taken part in the debate have paid tribute to the skill and dedication of those who work in the NHS. The Government applaud those sentiments.
  We have heard about the work of doctors and nurses, but we should not forget the ancillary and paramedical staff, who play an integral part in good hospital care. The involvement of ancillary staff can be critical in creating the atmosphere of contentment in our great NHS hospitals, whether large or small. We have benefited from the valuable perspective of my hon. Friend the Member for Newbury as a recent recipient of health services. That perspective has prompted him to bring forward the Bill, which is designed to ensure that the NHS deals more effectively, according to his lights, with complaints.
  We have had some interesting reflections on the nature of the NHS complaints procedure from the hon. Member for Holborn and St. Pancras and, particularly, from my hon. and learned Friend the Member for Mid-Bedfordshire (Mr. Lyell), whose 20 years of practice in the courts, sometimes involved with these issues, has given him the knowledge and experience with which to speak freely and in detail.
  We also heard interesting views from my hon. Friend the Member for Corby (Mr. Powell), whose own Bill moved forward one stage earlier today. It is characteristic of his assiduity as an hon. Member and of his interest in the welfare of his constituents that he should have stayed on to speak in yet another debate; some hon. Members might have given in to the temptation to repair to a place of refreshment to celebrate the progress of a Bill of their own.
  The basis of everything that my hon. Friend the Member for Newbury is intent on doing finds its source in his view that the National Health Service needs a patients' charter. That is a great issue. My hon. Friend first wrote to the Department in September 1984 to put forward his 10-point patients' charter. I think that he realises that

  1383
  these are complicated issues that require perhaps step-by-step movement and much detailed consultation with all those involved in our hospitals.
  The concept of the charter and the themes raised in it are far-reaching. For example, point No. 2 is:
  "No patient shall be prescribed powerful drugs until the hospital concerned has been in touch with the patient's general practitioner."
  My hon. Friend was too modest to refer to the matters set out in the charter, so I shall do it for him. The third point is that new patients must be covered by an insurance policy when they enter hospital.
  These matters and the range of others are most thought-provoking. I am not saying that the Government support them or oppose them. I am merely saying that they are thought-provoking for my right hon. Friend the Secretary of State, my right hon. and learned Friend the Minister for Health and myself in our continuing review of NHS policy. I hope that they are thought-provoking for the medical community at large.
  Apart from beginning to pilot the Bill through the House, my hon. Friend has begun to promote perhaps a slightly overdue debate in the NHS and medical circles about the nature of the complaints procedure and the responsiveness of the NHS to those we collectively hope to serve. I pay tribute to him for getting the debate going.
  Nothing could have shown more clearly the need for the debate than my hon. Friend's reference to the lack of information that he experienced, at least on one occasion, while he was in hospital. There was no leaflet next to his bed, and he was given no information about church services and other forms of help which so many patients entering a hospital would seek. We expect those who run our hospitals to provide that sort of information and to make it freely available. It is wrong that that information has not been given. I am sure that that view is shared by the hon. Member for Holborn and St. Pancras.
  Building on his experience, my hon. Friend the Member for Newbury has decided to initiate a debate on the nature of the responsiveness of the NHS to its consumers and the nature of the complaints procedure which, alas and alack, we must have. He has done that and has introduced an important hospital complaints procedure with, I think, the support of the whole House.
  The Government are concerned to increase the consumer responsiveness of the NHS. It must be more sensitive to the needs and wishes of patients. One of the key components of the recent NHS management inquiry report produced for us by Roy Griffiths and his colleagues was the importance of assessing and ensuring consumer satisfaction. In the talks about management changes that have flowed from our acceptance of the results of the inquiry as set out in the report, what Roy Griffiths and his colleagues had to say about the importance of listening to the consumer—the patient—has been rather overlooked. That is another reason for our being grateful to my hon. Friend for introducing the Bill.
  The improvements that I hope the Government are introducing into the management of the NHS are designed, among other things, to bring decision making closer to the patient and to begin to try to pinpoint exactly who is responsible for doing what at all stages in our hospitals. The introduction of general managers is providing an opportunity to stimulate initiative, energy and vitality in the management function. One necessary element in achieving this is the need to give proper attention to the
  1384
  needs of patients, or consumers. It is essential that NHS managers should know how well services are being delivered. The patients must be a valuable source of information. One should not simply ask the politicians, doctors, nurses, paramedicals, ancillaries, trade unionists and everyone else involved in the delivery of the service how the NHS is run. One should also ask the patients. That must be one of the touchstones of good, hard, hands-on management in the NHS. Managers should be seen to be taking account of what patients say about the NHS.
  The NHS already has a quite well-established complaints procedure in hospitals on the basis of guidance that we issue to the NHS, most recently in 1981. That advice emphasises a speedy, thorough and open response at the local level as the best approach to a complaint by a patient or relative. We expect health authorities to deal firmly and fully with complaints and to ensure that complainants receive informative and frank explanation. I agree with my hon. Friend the Member for Newbury that it is possible to sort out these problems quickly by immediate intervention by management, consultants, or nurse managers. I appreciate the point made by the hon. Member for Holborn and St. Pancras about the difficulty of complaining to a person about whom one has a complaint. There are intrinsic difficulties in that process.
  If a complainant remains dissatisfied, there are established procedures for a further review of the case at a higher level in the service by officers or, perhaps, by members of the authority. Those procedures are laid down in health notice HC(81)5 which was circulated in April 1981. Every Health Service manager has a copy of "Health Services Management: Health Service Complaints Procedure". There is much good basic guidance in that document.
  In addition to the NHS complaints procedure, the independent office of the Health Service Commissioner can investigate patients' grievances. He has the power to investigate complaints about the actions of a health authority involving an alleged failure in service, or failure in service provision or maladministration. About 120 cases a year are investigated by the Health Service Commissioner.
  It may be of interest for the House to know how the present complaints procedure works. Each year in England there are about 6 million inpatient admissions and almost 50 million episodes of outpatient treatment or treatment in accident and emergency departments. In 1983, 19,000 written complaints were received, or about one for every 3,000 episodes of treatment. Although it is a comparatively small figure given the overall volume of NHS activity, which is prodigiously large, 19,000 written complaints represent a considerable body of patients with grievances so great that they decided to write about them.
  My hon. Friend the Member for Newbury has received letters from not only fellow patients in the hospital which is treating him so well but—I was slightly grieved to hear this—from nursing staff in hospitals. The number of complaints has been growing in recent years. It is generally accepted that most complaints are made not to obtain financial compensation or to give a useful indoor relief to the lawyers — this point worried the hon. Member for Holborn and St. Pancras—but to obtain an adequate explanation as to why an action took place in a particular way. The lessons learnt from the volume of complaints can be valuable.

  1385
  The Bill is in line with the Government's aims for a more responsible NHS. It would be one step further—should it pass into law — towards achieving a better Health Service. In many ways, the duty that the Bill would lay on the Secretary of State is already fulfilled. The legislation would also provide a vehicle for the improvement of current procedures, to which my hon. and learned Friend the Member for Mid-Bedfordshire referred in his eloquent remarks. It will also give a valuable impetus to the drive for better services.
  My hon. Friend's Bill furnishes an opportunity for us to re-examine our complaints procedure. We should of course do that in full consultation with the medical and other health professions and with patients. We would determine with them the precise shape of the complaints procedure that the NHS needs to hear the patients' voice, to examine, critically perhaps, its own actions, and, most importantly, to act on the findings of those discussions. I am grateful to my hon. Friend for giving us that opportunity and impetus.
  The Bill will also provide us with a valuable opportunity to consider the available publicity material. A complaints procedure about which no one knows is of no use to anyone. We must do better. If my hon. Friend was let down and was not given the information that he felt he needed, we must do better and ensure that our hospitals give that information. That is not to say that people should be encouraged to complain unreasonably about the superb service which the NHS generally provides. My hon. Friend and my hon. and learned Friend paid tribute to that.
  We must be satisfied that we are not discouraging patients from voicing their legitimate anxieties. That is most important not just for patients but for the parents and relatives of those who are in hospital. They should feel much freer than hitherto they have felt to talk to staff about services and any queries that they may have. Staff should not feel inhibited from discussing such matters with complainants.
  Many complaints arise out of a sense of frustration—the feeling that people do not want to talk and give information. It is difficult to legislate about that. It requires major changes in the training regime for young doctors, nurses, paramedicals, and ancillaries who do such an important job in our hospitals. It is as true now as it ever has been that good communications between staff and patients will go a long way to reducing the number of complaints and the need for action which will undoubtedly flow from my hon. Friend's Bill.
  The Bill will provide my right hon. Friend the Secretary of State with an opportunity to consider afresh all the elements on which I have touched briefly, and perhaps to
  1386
  introduce a statutory complaints procedure which commands the confidence of patients and staff. It should make a real contribution towards the provision of a more consumer-responsive NHS. It is a duty which, as I said at the outset of my remarks, the Government welcome. We are most grateful to my hon. Friend for giving us the opportunity to welcome it.
  2.13 pm
  Mr. Michael McNair-Wilson: I must first thank all those hon. Members who have so kindly spoken about my Bill in such complimentary terms. May I take up, especially, the kind words of the hon. Member for Holborn and St. Pancras (Mr. Dobson) and follow one thing that he said which is accurate and to the point—that when complaints are aired things are put right which are then not wrong for someone who comes afterwards. Complaints help to improve services generally for today and the future. We should see the complaints procedure in that light.
  The second point I should like to make is to remind the House that there are between 1,100 and 1,200 complaints to each local health authority each year. As my hon. Friend the Minister said, that is a large number. That may be the tip of the iceberg or it may be the iceberg itself; I do not think that any of us are sure. But the more we can let patients air their views, the better Health Service we shall have.
  I remind the House that Professor Andrew Matthews of St. George's hospital in London told the British Association for the Advancement of Science that, in his experience, the better a patient was informed about his treatment and about the way that he was being looked after in hospital, the less was his reliance on pain-killing drugs and the quicker was his cure. That again underlines the need for communications between the medical staff and patients.
  I thank the Minister for his very kind words about my Bill and about myself. I thank him also for the many things that he has told us about how sensitive the Government are to the need to improve the consumer protection side of the Health Service—for that, after all, is what I am talking about. We all recognise that there is a shortcoming in terms of a complaints procedure, and I hope that the Bill will make good that omission.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill immediately considered in Committee; reported, without amendment.
  Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 58 (Third Reading), and agreed to.
  Bill accordingly read the Third time, and passed.

  Companies (Political Donations) Bill
  Order for Second Reading read.
  2.18 pm
  Mr. Derek Fatchett: I beg to move, That the Bill be now read a Second time.
  When I was fortunate enough —if that is the right term —to draw No. 18 in the ballot for private Members' Bills, I was offered different types of advice. Some hon. Members said to me, "Introduce a Bill that is non-contentious and that will gain support from all parts of the House. Then you can get a piece of legislation through and it will be remembered as the Fatchett Act. Alternatively, you can go down in a blaze of glory that will make a major political propaganda point and be forgotten by lunchtime." I decided to adopt the former course and to introduce a measure that is clearly non-contentious, that is designed to extend democracy in our society, and that should therefore gain the support of all sections of the House. It may well be that the spirit that has pervaded the House today, with two Bills making rapid progress, will also affect this Bill. It is a measure about extending democracy to shareholders in companies. It is about extending rights. Therefore, I should have thought that it was an important part of the political process in society.
  I should like to deal with one or two criticisms that might be made of the Bill. Some Conservative Members might suggest that the Bill is an attack upon the funds of the Conservative party. They will call in aid evidence that in 1983–84 the Conservative party received £2,780,000 worth of donations from private companies. They will say that what I am trying to do is stop companies donating to the Conservative party. That is not my intention, but if Conservative Members feel guilty about company donations, they may come to that conclusion.
  My intention is to give shareholders the right to have a say in those decisions. Surely no Conservative Member could object to that. It would simply be a case of company shareholders saying that they agreed that their company should have a political fund and be able to make donations. If we go through that democratic process, shareholders might agree to continue to donate funds to the Conservative party, although that would be surprising, judging by the value that they get for that money. In view of the way in which the country's economy has been managed over the past few years, I should have thought that it was not necessarily the best investment to make on behalf of shareholders. However, after a ballot and through the processes that my Bill sets out, the company shareholders might decide that it would be in their interests to vote the moneys to the Labour party. That would probably be a much better investment because they would have a much more sensible management of the economy, and they could look forward to their company growing and perhaps to greater dividends being paid on higher profits.
  Therefore, the Bill is not an attack on funds given to the Conservative party, nor is it an attack upon companies with directors who have received honours from the Prime Minister in the new year's or birthday honours lists. One or two of my right hon. and hon. Friends have referred to the relationship between company donations and mentions in the honours list, but it would be scurrilous to suggest that directors donate to the Conservative party simply to get a mention in the honours list. There must be a much
  1388
  better reason for donating to the Conservative party, although as yet I have not found one that would make sound financial sense.
  Therefore, the Bill is not an attack on the Conservative party or company directors. It is a modest Bill. On other occasions I have called it the shareholders' charter. It is an attempt to extend to shareholders the rights that trade unionists have enjoyed since 1913. If any Conservative Members oppose the Bill, they will be telling the country that they expect trade unions to hold ballots, give individuals the right to opt out, and have separate political funds for the payment of political donations, but that they do not expect any such controls or constraints on companies. It would be strange if there were such opposition because Conservative Members would be saying that they agreed that there should be a law for trade unions, but that there should not be the same application of that law for companies. When I look at Conservative Benches and see reasonable men — I include all Conservative Members present—I would expect them to put first the interests of the political system, not the interests of their own political party, and that what they would like is fairness in political donations so that trade unions and companies work on the same basis.
  Therefore, the Bill attempts to provide rights for shareholders that they have not enjoyed previously. The Bill could have gone about that in several ways. First, I could simply have introduced a clause that said that companies could not make political donations. I could have sought to make illegal political donations either to the Conservative party or to front organisations. However, this is a modest measure, which does not attempt to be that far-reaching. I am seeking consensus.
  I believe, as I am sure Conservative Members do, that it is part of our political process that the great institutions of our society donate to political parties and political organisations. Therefore, I do not want to make it illegal in that sense.
  But if I did, I would have some support from companies. The chairman of Cadbury Schweppes, Sir Adrian Cadbury, may well have supported the measure. He was reported in the Financial Times on 23 January 1984 as having said:
  "Boards of directors should consider stopping political contributions and instead pay the equivalent in higher dividends to allow shareholders to decide whether to donate."
  It is most unfortunate that Cadbury Schweppes did not listen to the excellent advice of its chairman. During the course of that year the organisation donated 15,000 to the Conservative party. Nevertheless, I could have taken Sir Adrian Cadbury's advice and simply introduced a Bill that said that there should be no political donations and that if shareholders wanted to donate to the Conservative party, or to the alliance, they could do so. I notice that no alliance Member is present. One of the great advantages of being an alliance Member is that the alliance has already introduced the shorter working week.
  Instead, I have sought to build upon the existing institutions and the fact that companies do donate, and I have sought to allow such donations to continue. I am trying to take from companies the right that they seem to exercise through their directors at the moment without any consultation whatever with shareholders.
  Let me draw attention to some of the problems that have been experienced by Gwent county council's superannuation fund. Employees of Gwent county council pay into

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  that fund. Looking at the political map of that part of the country I suspect that many of them are, wisely, Labour party voters. Gwent county council, probably feeling some of the democratic wishes of its employees, decided that it would examine the companies in which that fund invested to discover whether they donated to the Conservative party. The council then wrote to the companies and asked whether, if they did donate to the Conservative party, they would consider the possibility of no longer doing so because the pension fund would not be in favour of such donations.
  For example, the council wrote to the Sedgwick group, an organisation in which the Gwent county council had investment funds. The group replied:
  "This is not a matter in which shareholders can be involved."
  That shows a great belief in democracy, does it not? I cannot imagine the General Secretary of the TUC saying that trade unionists should not be involved. The horror of Conservative Members would be unbelievable. It would be synthetic, but it would be unbelievable.
  Mr. Tim Yeo rose—
  Mr. Fatchett: No, I shall not give way.
  The Hambro group, in which Gwent county council also invested, said:
  "The board reserves the right to act in accordance with its views."
  That is a lovely democratic principle, is it not? One or two of my hon. Friends may say that company directors make such bizarre decisions on occasions that they appear not to act in accordance with their own views. But Hambro's belief in shareholders' democracy is so great that it says that the board of directors will act in accordance with its own views.
  My modest Bill would extend to shareholders the right to a ballot. It would tell directors that they have a responsibility to consult individual shareholders before they use company money for political donations, just like a trade union. There would have to be a ballot to set up a political fund, and it would be at that point that the shareholders would choose whether they wanted their company to participate. They may say that they do not want their company to invest or spend money in that way, but that would be a democratic decision.
  Who are we, having been elected by the democratic process, to deny the value and validity of that process? I cannot imagine any Conservative Members saying that they would disagree with such a decision. There will thus be a decision to set up a political fund. There will also be a right for individual shareholders to opt out of contributing to political donations. We may later wish to extend that to individual employees, who create the company's wealth, or to consumers who probably make a donation to the Conservative party every time they go into a public house. I am attracted by the idea of a non-Conservative party beer; that is a very populist issue. People could then opt out of the political levy. At present, however, the Bill extends that right only to shareholders—
  It being half-past Two o'clock, the debate stood adjourned.
  Debate to be resumed upon Friday 5 July.

  Private Members' Bills

    GAMING (BINGO) BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Second Reading deferred till Friday 1 March.

    TEACHERS (INDEPENDENT PAY REVIEW) (SCOTLAND) BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Mr. Deputy Speaker (Sir Paul Dean): Second Reading what day? No day named.

    PENSIONERS' RIGHT TO FUEL AND COMMUNICATIONS BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Mr. Deputy Speaker: Second Reading what day? No day named.

    WATER AUTHORITIES (MEETINGS) BILL
    Order read for resuming adjourned debate on Question —[1 February]—That the Bill be now read a Second time.
    Question again proposed.
    Hon. Members: Object.
    Debate to be resumed upon Friday 12 July.

    DANGEROUS VESSELS BILL [LORDS]
    Order for Second Reading read.
    Hon. Members: Object.
    Second Reading deferred till Friday 1 March.

    SMALL BUSINESS BILL
    Order read for resuming adjourned debate on Question —[18 January]—That the Bill be now read a Second time.
    Question again proposed.
    Hon. Members: Object.
    Mr. Deputy Speaker: Debate to be resumed what day? No day named.

    NORTHERN IRELAND (TERMINATION OF JURISDICTION) BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Second Reading deferred till Friday 19 April.

    CHARITIES BILL [LORDS]
    Order for Second Reading read.
    Hon. Members: Object.
    Second Reading deferred till Friday 1 March.

    EDUCATION (SCHOOL BUDGETS) BILL
    Order read for resuming adjourned debate on Question —[8 February] —That the Bill be now read a Second time.
    Question again proposed.
    Hon. Members: Object.
    Mr. Deputy Speaker: Debate to be resumed what day? No day named.

    CONTROL OF POLITICAL EXPENDITURE BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Mr. Deputy Speaker: Second Reading what day? No day named.

    TRADE UNION AND EMPLOYMENT ACTS (REPEAL) BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Mr. Deputy Speaker: Second Reading what day? No day named.

    ANIMAL WELFARE BILL
    Order for Second Reading read.
    Hon. Members: Object.
    Mr. Deputy Speaker: Second Reading what day? No day named.

    BUSINESS OF THE HOUSE
    Ordered,
    That, at the sitting on Wednesday 27th February proceedings on the business selected in pursuance of paragraph (2) of Standing Order No. 6 (Arrangement of public business) shall, if not previously concluded, lapse at Seven o'clock and shall be counted as a half day as provided by that Order.—[Mr. Archie Hamilton.]

  Professional Boxing
  Motion made, and Question proposed, That this House do now adjourn.—[Mr,. Archie Hamilton.]
  2.32 pm
  Mr. Colin Moynihan: The Times in a notable leader last year commented:
  "Boxing has a long history often invested with glamour. It is seen as a trial of courage and strength, a producer of heroes, a ritualisation of the combats by which mankind has developed. It has enabled a few exceptional individuals to escape from poverty and racial discrimination and rise to wealth and fame. It is held to have practical value in developing character and skill in self-defence. It is enjoyed by many spectators and it earns a lot of money for some businessmen."
  It continued that banning boxing
  "would be an unwarranted interference with individual liberty. It is perfectly legal to damage oneself with alcohol, nicotine and other permitted drugs. It is even legal to commit suicide. Boxing is voluntary for those who receive the damage as well as for those who inflict it."
  The brain does not distinguish between the impact of an amateur or a professional glove, a football, a fist or shoulder in a rugby scrum, or the ground as a jockey falls from a horse. Hang-gliding, pot-holing, rock-climbing and other dangerous pursuits are not sports that I pursue and I share the concern at the enormous cost in money and human life when such high-risk sports go wrong and rescue operations have to be mounted. Nevertheless, I strongly respect the right of the individual to choose his own destiny.
  To those people who would ban boxing on the grounds that it is dangerous, I put the facts. Yes, it is one of many dangerous sports. It is a tragedy that there have been 10 deaths in professional boxing in this country since 1945, of which six were British, one due to aspirin sensitivity. Yet over 480 people died in sport between the years of 1969 and 1981 alone. What of mountaineering, horse riding, football and rugby, where in each case the figures for deaths are higher? What of smoking and drinking? Would those who seek to ban boxing logically extend their argument and ban them? Stringent medical safeguards, popular support and willingness to discuss the moral and ethical issues concerned with professional boxing are essential to the success of the sport. The price for boxing's future will rightly be eternal vigilance in all these areas.
  When we look at sport today, and particularly boxing, we see strong arguments why the 1980s should go down in the annals of professional boxing as a glorious decade for the sport. Yet the likelihood grows, year by year, that this decade may mark the end of professional boxing. It is deeply to be regretted that I come before the House concerned that the future of the sport is threatened—threatened primarily not from the medical lobby, from pressure groups or from lack of public interest but from within the sport itself.
  I should state from the outset that I retain an unpaid interest in boxing. Along with my hon. Friends the Members for Edinburgh, West (Lord James Douglas-Hamilton), for Upminster (Sir N. Bonsor) and for Wells (Mr. Heathcoat-Amory), I was honoured to represent Oxford university in the varsity match. An unexpected com/box swap with Charlie Magri at the helm of the Oxford VIII brought me into contact with Terry Lawless for whom I have the highest respect, and, I might add, into physical contact with Paddy McGuire in the ring, sparring against the former British bantamweight champion, down

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  the Becket in the Old Kent road. Soon thereafter I joined the Boxing Board, along with other stewards whose sole service is to have the privilege of serving the active sportsmen, in our case the boxers, and the licence holders who support them.
  Having declared my interest I should like to substantiate my view that professional boxing should be at its zenith. To begin with, we have record levels of boxers who are licensed by the board. Hon. Members should consider the facts. For example, 1974, 1975 and 1976 saw 242, 356 and 395 licensed boxers participating in 150 tournaments. Over the past three years the figures have stood at 538, 576 and 551, with over 242 tournaments last year alone.
  Recently, the British Boxing Board of Control for the first time since its inception in 1929 was accepted as a full member of the World Boxing Association. Now our fighters can challenge for WBC and WBA titles.
  Only last year, television policy limited coverage to two live and two delayed contests in a year. Today, after a carefully monitored 12-month pilot scheme to ensure the prevention of studio boxing, licensed promoters can have 20 shows televised in total on the national network. That is a reflection, not only of the increasing popularity of the sport and of the high viewing figures, but of the substantial public support that exists, as those attending promotions will know. The advent of increased television coverage, although it has meant administrative problems, will, we hope, mean that more people connected with the sport will try their hand at promoting, and may themselves develop into major forces to challenge any recent tendencies towards monopoly, thereby becoming capable of staging world title fights, and enabling boxers from the regions to have the chance of boxing before their home crowds and audiences. It should be healthy to have two major promoters. It should not develop into an internal battle at the expense of the sport.
  To match this growth in activity, unrivalled medical controls and safeguards are implemented by the board. Boxing in Britain leads the world in assessing, maintaining and developing standards of medical control. It was we, the British, who introduced the universal boxing passport two years ago, now carried by all boxers under the aegis of the World Boxing Council, and containing specific medical and boxing records. It is we who have sought to improve the state of boxers' fitness and the degree of medical control.
  Before any boxer is considered for a licence he must have the official medical examination form completed. This form must be completed every year when his licence is due for renewal. In addition, every boxer is examined before every contest in which he takes part, and again after each contest.
  A minimum of two medical officers must attend every tournament. Incidentally, many of them are members of the British Medical Association. The medical arguments outlined in the BMA report published last year do not, I believe, stand up to examination. The moral question is, of course, worthy of consideration and debate, and I put it on record that I am as fully aware as anyone of the hazards of the sport, and, certainly as far as professional boxing is concerned, so are the participants.
  Professional boxing is undertaken through consent. Banning it would drive it underground without adequate
  1394
  medical supervision, as in unlicensed shows. The continuation of the sport under those circumstances, devoid of stringent medical safeguards, would be unacceptable to me.
  As Eric Armit, a respected boxing statistician, said:
  "When our sport is attacked we all close ranks. All that I ask is that we must never close our minds to the fact that boxing is about boxers and we should always be looking for ways to increase their safety."
  The real danger to the future of the sport—my prime intention today is to draw this to the attention of the House — derives from the threat to boxing from within its ranks. Let us consider the board's role. The board has accepted many of the challenges of today's world. Since its inception in 1929 some outstanding stewards have helped to promote the interests of the sport. The board is not financially interested and has been totally independent. It could be said that the board comprised moneyed Corinthians. In the past the board has been able to devote a great deal of time to boxing. Not only do the board's members seek to influence through rules and regulations, but they offer arbitration services for disputes among licence holders.
  The tempo of life today is different. The Corinthians of the past were not burdened with instant media coverage or by huge financial deals. Perhaps the Corinthians have gone. Perhaps the board is sticking too hard and fast to a non-financially interested status. Perhaps it should consider restricting its involvement in the sport to administration. Perhaps it should look for statutory backing through a charter responsible to the Minister. Perhaps it should withdraw from arbitration between licence holders.
  In the old days licence holders would go to the stewards with a range of problems. They were the best benevolent oligarchies ever known. I still like to think that the board is benevolent, but the concept of oligarchy is now as outmoded as the Corinthian ideal.
  Some would argue that the board performs best in assessing where the sport is going, developing policies for television and protecting the six-rounders. These are valid questions and the board should never cease to address them.
  What about the promoters? I remind those involved in unnecessary litigation over technical actions, which can only damage the sport, that the only finance generated by the board comes from the licence holders. Traditionally, that has rightly been kept at a low level. Unlike football and other sports, boxing does not enjoy direct handouts. The board does not promote the sport, own venues, have fixture lists or act as impresarios. Yet today we are using money from many Peters to defend against a few Pauls.
  There comes a time when the figures involved in litigation are greater than the resources available to the board. When the board shrinks from doing what it believes to be right because of monetary restraints, the sport will be under serious threat. When the board looks for the easy way out because the course that it believes to be right cannot be pursued due to the cost of litigation, it will be time for the board to go.
  Before Conteh, in the 1970s, I cannot recall the last time that the board was taken to court. Perhaps the last time involved Sullivan in the 1940s. Apart from the first action with Conteh the board has lost no further cases. The

  1395
  cost of defending the litigation currently pending on two High Court actions could far outstretch the board's present reserves of about £100,000.
  I for one do not believe that I could stand in the House, or anywhere else, and defend the future of professional boxing, despite my deep commitment to the sport, without the medical control and supervision that is exercised by the board and is respected worldwide. The safety of the boxers is paramount and their interests must be served first. The main fight is between rival factions, which has resulted in litigation, with the non-financially interested board in the middle. Of course people should be entitled to ply their trade within the law and any constraint on their freedom is lawful only if it is reasonable.
  The board believes that such constraints as it imposes are reasonable and fair. Indeed, the board's regulations are open to change at annual general meetings and embrace all licence holders. It is there that the opportunity to change the rules exists. I accept that all licence holders are professional business men, but let us consider the analogy of planning control. One cannot build on a piece of land irrespective of anyone else. The law is there to protect the public at large from the whims of the individual. Similarly, once a man takes out a licence and accepts the British Boxing Board of Control's regulations he cannot expect to promote when and where he wants, irrespective of clashes of dates or the future interests of the sport. The general body of rules and regulations protect all the promoters and licence holders and, above all, secure the future of the sport.
  We must recognise that the future of British boxing is at stake. The board has a duty to respond to a world of boxing far removed from that which faced its Corinthian predecessors. It is doing just that. There is an onus on promoters to put on the very best shows to encourage the paying public to continue their support. Above all, there is an overriding duty to promote the interests of the boxers who are the sport's greatest asset.
  I have tried to restrict my comments to under the usual 15 minutes to allow the hon. Member—although on this occasion it would be fair to say my hon. Friend—for Stalybridge and Hyde (Mr. Pendry) to contribute to the debate. I know that my hon. Friend the Minister is agreeable to that.
  2.46 pm
  Mr. Tom Pendry: I thank the hon. Member for Lewisham, East (Mr. Moynihan) and the Minister for their generosity in allowing me to have my tuppence worth—more likely my five minutes' worth—on this important subject. I commend the hon. Gentleman not only on his choice of subject but on the way that he has spoken, which was very commendable. It is probably the only subject on which we agree. We both broke sweat in the ring for the dark blues at Oxford, which qualifies us more than most hon. Members to speak about this subject.
  There is no doubt that boxing is under threat, and the House knows that. It is under threat from the British Medical Association which, at its Manchester delegate conference, agreed to campaign actively to ban the sport —even though only a minority of members took part in the conference. It is campaigning, and we must take the threat seriously.
  Everyone knows that boxing can be dangerous, and I do not exclude the hon. Gentleman from that comment.
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  It must have affected him because otherwise he would be not on the Conservative Benches but on the Opposition Benches. However, boxing has a good record in this country. There have been 10 deaths since 1945–10 too many — with two deaths during the past 15 years. Putting that statistic in the context of other sports, the number of deaths in boxing pales into insignificance—if one can use that expression about death. That applies also to serious injuries, and I am sure that the Minister agrees with that.
  Unless we are to be a nation that wraps itself in cotton wool, we must accept that a person entering competitive sport will get hurt at some stage. Tragically, some people will be killed. We must ensure that boxing remains in being while forever trying to ensure that the safeguards are maintained.
  I am sure that the hon. Gentleman will agree that a special mention should be made of the chief medical officer of the BBBC, Dr. Adrian Whiteson, and his staff. They have done a tremendous job to ensure that boxing is as safe as possible. Not a great deal of publicity has been given to their work. The number of boxers forced to retire by the board has received little publicity, and the same applies to boxers who have decided to quit. Colin Jones, with 33 bouts, will probably retire permanently, as will Charlie Magri with 33 bouts. Compare that with boxers like Ted "Kid" Lewis with 280 fights in less than five years, yet who lived to the ripe old age of 74. That would not be permitted today. Therefore, I support the hon. Gentleman and the BBBC.
  I wish briefly to mention an area that is worrying us all. The subject, which was mentioned by the hon. Member for Lewisham, East is vital to the good name of boxing. I refer to the allegations that a cartel is operating in boxing, as exposed by The Sunday Times last month. If Jarvis Astaire, Mickey Duff, Mike Barrett and Terry Lawless are guilty of those allegations, they must go to the BBBC and give it the fullest co-operation. Instead, one gathers, they are hiding behind their lawyers' apron strings. The board must not be inhibited by such tactics. We expect the board to be positive and firm in ensuring that boxing's good name is maintained.
  In my submission, parliamentary privilege was established to assist people such as those members of the board who wish to get to the facts but who are inhibited from doing so by lawyers. I am sure that many hon. Members would be prepared to speak up for the BBBC in this matter. However, there is no substitute for the board, as the governing body of boxing, taking upon itself this role and doing it without help even from well-meaning hon. Members and others.
  The Minister, who is sympathetic to boxing, cannot sit back overlong and allow this matter to drag on. As the custodian of British sport in the House, he must, if necessary, trigger off the mechanism of the Office of Fair Trading if he believes that a restraint on trade is in operation. I hope that he will reply to that point. Again, I congratulate the hon. Member for Lewisham, East on initiating the debate and on the way in which he did so.
  2.52 pm
  The Parliamentary Under-Secretary of State for the Environment (Mr. Neil Macfarlane): I echo the sentiments of the hon. Member for Stalybridge and Hyde (Mr. Pendry) in welcoming this debate introduced by my

  1397
  hon. Friend the Member for Lewisham, East (Mr. Moynihan) on the matter of professional boxing, which has been a source of much disquiet outside the House.
  This is a subject on which both hon. Members are well qualified to speak. Both have personal experience of the sport, and it will bring a feeling of warmth and a glow to your heart, Mr. Deputy Speaker, to realise that they were both dark blues, obviously at varying weights. My hon. Friend is a competitor and steward of the British Boxing Board of Control, and he has wider experience as a member both of the Sports Council and the 1984 British Olympic team.
  The hon. Member for Stalybridge and Hyde has played a consistent part in these matters in the House for a number of years, and I am grateful for his contribution. He will understand that there are many points in the debate to which I cannot respond in view of the litigation which is occurring elsewhere.
  Professional boxing has established a proud tradition in this country in the last 60 years or so, largely through the commendable efforts of the sport's governing body, the BBBC, the format of which has been followed in other countries.
  The BBBC was first formed in 1918. As part of my preparation for the debate, I read the excellent BBBC jubilee document which was published in 1979 and was fascinated to read about how the board began. History is all-important in this, as in other spheres. An article by Gilbert Odd, the former editor of Boxing News, began:
  "Answering a correspondent in its issue dated September 9th 1911, 'Boxing' stated, 'A licence is not required for a boxing hall, but you should apply for police protection.—
  Clearly, the sport felt that it should be well-regulated. I am happy to note that my hon. Friend the Member for Epsom and Ewell (Mr. Hamilton), is doing duty on the Government Front Bench this afternoon. One of his forebears, a great uncle, Lord Hamilton of Dalzell, was one of the founding members of the BBBC.
  This is an important debate and it is interesting to note exactly how the board was formed in 1929. It was born out of the old National Sporting Club, founded in 1891, and in March 1929 the BBBC's first constitution and regulations were issued. The first president of the BBBC was Lord Lonsdale, whose name lives on.
  Before the BBBC came into being, managers and trainers were self-appointed with little or no qualifications, and the same applied to referees. Concern for the physical welfare of boxers was negligible and the attendance of a doctor at the ringside was very rare indeed. Since the board's inception, it has led the way in the introduction of measures to protect boxers, and has highly qualified members of the medical profession within its ranks. I endorse what has been said about its chief medical adviser. It has also played a significant role in the production of the stringent medical requirements that all professional boxers must meet before they are allowed to compete. In addition, the BBBC is recognised by many countries as a fine example of how a sport should be regulated, controlled and administered.
  Just as the future development of professional boxing under the auspices of the BBBC relies on the amateur side of the sport—most professionals have had an amateur career — so the reverse is true. Professional boxing provides the incentive for amateurs. The amateur side of
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  the sport is controlled by the Amateur Boxing Association in England, to which the Schools Amateur Boxing Association is affiliated.
  There has been a marked increase in interest in amateur boxing in recent years. There are about 870 clubs with 45,000 registered members. Many of the youngsters who join boxing clubs come from deprived areas and inner cities and encounter at their clubs, sometimes for the first time, firm but fair discipline. They are encouraged to develop their physical fitness and mental awareness and they learn self-control and develop team spirit that they may have lacked before. The club gives them a positive interest and goals to aim for.
  In recognition of the important role that amateur boxing has to play in the community and in encouraging youngsters to channel their energies into a demanding sport, the Sports Council assisted local clubs with £47,500 in capital grants and loans in 1983–84. In addition, the ABA received over £82,000 in current grant in that year and the schools body received about £3,500.
  Between them, the BBBC and the ABA have been responsible not only for much of the development of the sport, but for producing world champions and Olympic medallists who have become household names and passed into folklore. The popularity of the sport is evidenced by the large crowds which flock to important bouts and by the press coverage that the sport receives, which is an important dimension.
  Lately, some of those press reports have not been as encouraging as they might have been for the sport. There has been concern about the health dangers of boxing and reports of a cartel operating at the highest level within the sport. Those matters are primarily for the governing body — the BBBC. As one would expect, the board has responded responsibly.
  The House would not expect me to comment in detail on the allegation of a cartel. I have read the newspapers and absorbed the articles. I note that the BBBC is to investigate the allegation and take whatever action is required. That open-minded approach can only be for the good of the sport, and the comments made in the debate will be widely read and absorbed.
  I recognise clearly the legitimate concerns of some members of the medical profession about some of the risks associated with boxing — I discussed those concerns when I last met the BBBC formally—and the board of control also takes those concerns seriously. As I said, the board has led the way in the introduction of measures to protect boxers.
  However, the risk of injury cannot be eliminated in any contest, as hon. Members have said, and it is important to recognise that those who take up boxing and many other sports do so in full knowledge of the injuries that they might sustain. Recent publicity about the health risks of boxing will have ensured that that is even more true. However, while those who take up boxing do so in that knowledge, and as a result of their interest in the sport, it is right that they should be subjected to the most rigorous medical requirements and that those should be controlled by their own governing body.
  Like any sport or any other public activity, boxing will have its problems and difficulties with which it must cope. However, I am sure that, with continued responsible and clear leadership from its governing body, it will have a bright future. The ability of the sport to attract talent and spectators is not in doubt and I am sure that the BBBC will

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  continue to live up to its long and honourable traditions. The Government see that as a right and proper role for the BBBC. It is a fundamental principle of British sport that individual sports are controlled by the governing bodies that are responsible to their own members. The state does not run sport in Britain.
  Those who call for legislation to ban professional boxing should remember that legislation of the type sometimes advocated would no more mean an end to people fighting with their fists for money than prohibition meant an end to people drinking in Chicago and elsewhere in America in the 1920s and 1930s. However, as my hon. Friend the Member for Lewisham, East said in his excellent speech, it would signal the end to the control exercised by the governing body, which has been a model, and the rigorous code that it currently enforces. We would
  1400
  step backwards into time to the back-street or fairground booth style of boxing, which the current rules are designed to prevent.
  This has been a constructive debate. I hope that the comments of my hon. Friend the Member for Lewisham, East and of the hon. Member for Stalybridge and Hyde will be widely absorbed outside the House. Those of us who have an interest in and direct responsibility for the orderliness of a major sport in this country want to see question marks eliminated as quickly as possible. I commend the debate to the House and for wider reading. I am grateful to my hon. Friend for initiating, and to the hon. Gentleman for participating in, a debate on such an important subject. I shall consider many of the important issues which have been raised and write to my hon. Friend and the hon. Gentleman.
  Question put and agreed to.
  Adjourned accordingly at Three o'clock.

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  Duich Moss (Peat Stripping)
  Duich Moss (Peat Stripping)
  Garnock Valley (Redevelopment)
  Garnock Valley (Redevelopment)
  Hunterston A Power Station
  Hunterston A Power Station
  Fenitrothion
  Fenitrothion
  Police Surveillance
  Police Surveillance
  Teachers (Pay)
  Teachers (Pay)
  Regional Grant Aid
  Regional Grant Aid
  Broadleaved Woodlands
  Broadleaved Woodlands
NORTHERN IRELAND
  Housing Executive
  Housing Executive
  Sinn Fein (Meetings)
  Sinn Fein (Meetings)
  Orlit Houses
  Orlit Houses
  Loans (Interest Rates)
  Loans (Interest Rates)
HOME DEPARTMENT
  Coal Industry Dispute
  Coal Industry Dispute
  Neighbourhood Watch Schemes
  Neighbourhood Watch Schemes
  Black Community
  Black Community
  Nuclear Burst
  Nuclear Burst
  European Assembly Elections (Candidates)
  European Assembly Elections (Candidates)
  Arrested Persons (Toilet Facilities)
  Arrested Persons (Toilet Facilities)
  Misuse of Drugs Act 1971
  Misuse of Drugs Act 1971
  Drugs Branch Inspectorate
  Drugs Branch Inspectorate
  Drug Addicts (Notification)
  Drug Addicts (Notification)
  Devizes Police Station (Incident)
  Devizes Police Station (Incident)
  Parliamentary Constituencies (Reviews)
  Parliamentary Constituencies (Reviews)
ENVIRONMENT
  Concessionary Television Licence
  Concessionary Television Licence
  Central London (Office Space)
  Central London (Office Space)
  Radioactive Material (Lumns Lane, Salford)
  Radioactive Material (Lumns Lane, Salford)
  Refuse Disposal
  Refuse Disposal
  Local Government Reform
  Local Government Reform
  East Country Yard, Southwark
  East Country Yard, Southwark
  ILEA (Precept)
  ILEA (Precept)
  Urban Programme
  Urban Programme
  Caravan Sites Act 1968
  Caravan Sites Act 1968
DEFENCE
  Trident
  Trident
  Hong Kong Ferry
  Hong Kong Ferry
  Single Role Minehunter
  Single Role Minehunter
  Mines Counter-measure Vessels
  Mines Counter-measure Vessels
  RAF Molesworth
  RAF Molesworth
  Ascension Island (NAAFI Stores)
  Ascension Island (NAAFI Stores)
  Departmental Staff (Education Grants)
  Departmental Staff (Education Grants)
  Departmental Cleaning Contracts
  Departmental Cleaning Contracts
  Clean Industrial Services Ltd.
  Clean Industrial Services Ltd.
  Cleaners (Vetting)
  Cleaners (Vetting)
  Mrs. Molly Balkinson
  Mrs. Molly Balkinson
  Arms Exports
  Arms Exports
TRANSPORT
  A303 (Road Schemes)
  A303 (Road Schemes)
PRIME MINISTER
  Parliamentary Questions
  Parliamentary Questions
  Polaris Submarines (Radiation)
  Polaris Submarines (Radiation)
  Official Information (Leak)
  Official Information (Leak)
TRADE AND INDUSTRY
  Manufactured Goods
  Manufactured Goods
  Hall Russell Shipbuilders, Aberdeen
  Hall Russell Shipbuilders, Aberdeen
  Falmouth Shiprepair Ltd.
  Falmouth Shiprepair Ltd.
  Ferrous Scrap
  Ferrous Scrap
  Support for Innovation Programme (Yorkshire and Humberside)
  Support for Innovation Programme (Yorkshire and Humberside)
  Departmental Services
  Departmental Services
  Soviet Union
  Soviet Union
  Unit Costs
  Unit Costs
AGRICULTURE, FISHERIES AND FOOD
  Whitefish
  Whitefish
  Agricultural Products (Exports)
  Agricultural Products (Exports)
  Pesticides
  Pesticides
  Paraquat
  Paraquat
  Alachlor
  Alachlor
  Conservation
  Conservation
  Farmers (Subsidy Allocations)
  Farmers (Subsidy Allocations)
  Eggs Authority
  Eggs Authority