Sitting of 24 April 1986

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

  TEIGNMOUTH QUAY COMPANY BILL (By Order)
  Order for Second Reading read.
  To be read a Second time upon Thursday 1 May

  COUNTY OF SOUTH GLAMORGAN (TAFF CROSSING) BILL (By Order)
  Order for Second Reading read.
  To be read a Second time upon Thursday 1 May at Seven o'clock.
  SOUTH YORKSHIRE LIGHT RAIL TRANSIT BILL (By Order)
  BEXLEY LONDON BOROUGH COUNCIL BILL (By Order)
  SHOREHAM PORT AUTHORITY BILL (By Order)
  Orders for Second Reading read.
  To be read a Second time upon Thursday 1 May.

  HARWICH PARKESTON QUAY BILL (By Order)
  Order for Second Reading read.
  To be read a Second time upon Monday 28 April at Seven o'clock.

  MILFORD HAVEN PORT AUTHORITY BILL (By Order)
  Order read for resuming adjourned debate on Question [18 February], That the Bill be now read a Second time.
  Debate to be resumed upon Thursday 1 May.

  BRITISH RAILWAYS (STANSTED) BILL (By Order)
  Order read for resuming adjourned debate on Question [24 February], That the Bill be now read a Second time.
  Debate to be resumed upon Thursday 1 May.

Oral Answers to Questions
  HOME DEPARTMENT

    Civil Defence
    Mr. Aspinwallasked the Secretary of State for the Home Department if he will make it his policy to adopt the title civil protection for civil defence.
    The Minister of State, Home Office (Mr. Giles Shaw): We are considering possible alternative titles, including civil protection, and will announce a decision in due course.
    Mr. Aspinwall: Has my hon. Friend initiated any research into the public perception of the term civil defence and, if so, what were its findings?
    Mr. Shaw: Yes. Last year we introduced some attitudinal research data on the awareness and understanding of civil defence. This has been most helpful in the preparation of the revised publicity material, which we hope to be able to issue in the course of this year.

    Overseas Visitors
    Mr. Proctorasked the Secretary of State for the Home Department when the last investigation took place where visitors to the United Kingdom were recorded as not having re-embarked; how many such visitors were investigated and what kind of evidence was accepted as proof that a particular visitor was no longer in the United Kingdom; and if he will make a statement.
    The Minister of State, Home Office (Mr. David Waddington): Very recently, since the investigation of apparent overstaying by persons subject to immigration control, including visitors, is a continuous but selective process. Acceptable evidence of departure, in the absence of a computer record, would vary from case to case.
    Mr. Proctor: In view of the concern that visitors coming into this country are not checked out, despite the modern computer aids available, will my hon. and learned Friend reinvestigate the matter, because the crime of overstaying is important and serious and needs attention?
    Mr. Waddington: I must correct my hon. Friend. It is not true to say that those who are admitted as visitors are not checked out. Three hundred thousand passengers who were landed last year were landed on check-out conditions. Our records confirm embarkation in 95 per cent. of cases. It is a great mistake to imagine that all the others have not left. Experience shows that all too often when the case of someone who is not recorded on computer is followed up it is discovered that he has left.
    Mr. Madden: Will the Minister confirm that overstaying among visitors is not a problem? Indeed, his figures show that only 187 of the 18,000 people refused permission to enter last year absconded. Will he also confirm that the Home Office has taken over part of the Post House hotel at Heathrow to accommodate those who are awaiting interview, often for days, and that that problem would be greatly improved if more than eight interpreters were employed at Heathrow to interview visitors?
    Mr. Waddington: I cannot answer the second part of the hon. Gentleman's question. However, I shall write to him and give him what information I can. On the first part of the question, one must neither exaggerate the extent of the problem nor minimise it. I must point out that no fewer than 1,280 overstayers were investigated and indentified last year.
    Mr. Watts: Does my hon. and learned Friend agree that without a complete check on re-embarkation it is impossible to know the size of the problem of overstaying? In view of his recent written answer to me, which showed that only 5 per cent. of visitors are so recorded, does he not think that it is time we took firmer measures to ensure the re-embarkation of those who enter as visitors?
    Mr. Waddington: The number of people involved is the main problem. Six million people were admitted as visitors in 1984, and millions of people go through immigration control as they leave the country, and no matter how diligent the immigration officer is, he cannot always spot that someone who passes him was admitted to the country on check-out conditions. We have to be selective and follow up the cases where we have reason to believe that there has been a breach of the law and overstaying.
    Mr. Meadowcroft: How many of those who were refused leave to enter but given temporary admission actually absconded?
    Mr. Waddington: I do not have figures before me now, but they have been provided before when questions on that specific point were raised. I am prepared to write to the hon. Gentleman to give him the information that he requires.
    Mr. Budgen: Will it ever be possible to deal with the problem of overstaying without introducing a system based upon identity cards?
    Mr. Waddington: Many people in this country would be very reluctant to see the introduction of identity cards. The decision to abolish the use of identity cards was received with loud acclaim and we would have to be very careful before reintroducing them.

    Prisoners (Medical Condition)
    Mr. Jannerasked the Secretary of State for the Home Department whether he has completed his consideration of advice to prison authorities and guidance to medical officers given by his Department, following his consideration of the case of Kevin Capenhurst.
    The Parliamentary Under-Secretary of State for the Home Department (Mr. David Mellor): We shall be issuing additional guidance in the near future to governors and medical officers of all Prison Department establishments. This will remind them of the need to give prompt consideration to the possibility of special remission of sentence under the royal prerogative of mercy for prisoners who are suffering from terminal illness or are bedridden or similarly incapacitated. I shall place a copy of that guidance in the Library when it is issued.
    Mr. Janner: I thank the Minister for that helpful reply and I am glad that at last some step is to be taken in this matter. However, is the Minister aware that a reminder to medical officers is seldom sufficient to achieve the
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    required result, and that what is needed is that the Minister himself should be informed when one of the very few prisoners who are terminally ill is refused permission to go home or elsewhere to die in dignity? When will he institute instructions that he should be informed about such cases?
    Mr. Mellor: I should like to stress two points to the hon. and learned Gentleman, whose interest in these matters is well known to me. First, the guidance note which will be sent out will make some alterations which will be of assistance to ensure that these cases are dealt with even more effectively in future than they have been.
    Secondly, on the hon. and learned Gentleman's point about Minister's being notified, I am anxious not to establish bureaucratic procedures which will slow down and not speed up the process of releasing people in genuine cases. Where there are cases of difficulty, these should be reported immediately to Ministers.

    Hong Kong
    Mr. Ashleyasked the Secretary of State for the Home Department what representations he has received from the Legislative Council of Hong Kong on the proposed Hong Kong (British Nationality) Order.
    Mr. Waddington: The Legislative Council made representations asking for an endorsement about visits in the British National (Overseas) passport and it asked that British citizenship should be granted to former service men in Hong Kong and to British dependent territories citizens who were not ethnically Chinese. My right hon. Friend announced the Government's response yesterday in reply to a question from my hon. Friend the Member for Lewisham, East (Mr. Moynihan).
    Mr. Ashley: Is the Minister aware that China understandably refused to grant citizenship to non-Chinese residents in Hong Kong because they are a British responsibility? Does he accept that it is outrageous and unreasonable for the Government to refuse—as the Home Secretary has refused—British citizenship to that group of people? We simply cannot use people when it suits our purpose and then discard them when it does not. Is he aware that these 11,500 people will become stateless unless the Government change their mind? May we have some reconsideration of the Government's decision?
    Mr. Waddington: The right hon. Gentleman has raised a number of points. First, the Chinese Government have confirmed that non-Chinese who meet the legal requirements under the Chinese nationality law may apply for Chinese nationality and that such cases will be dealt with by the appropriate authorities. Giving the non-ethnic Chinese British citizenship would not secure for them what they want—the right of abode in Hong Kong. They will not be left stateless. All British dependent territory citizens will be entitled to BNO status, and those who do not apply and have no other nationality will become BOCs, a status which will also be available to their children and grandchildren.
    Mr. Stanbrook: Is my hon. and learned Friend aware that the category of British nationality known as British dependent territory citizenship is a fundamentally unsatisfactory method of dealing with the problem, and that after 1997 the numbers in that category will be so

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    small that it might well be desirable to abolish the category and appropriate them within the category of British citizenship?
    Mr. Waddington: I cannot agree with my hon. Friend. I think that the decisions that are being taken are right. I repeat that no one will be left without a citizenship. Those who are now BDTCs will be able to apply for the new status of BNO. If they do not apply, again they will not be left without citizenship, because they will be entitled to BOC status.

    Neighbourhood Watch Schemes
    Mr. Colvinasked the Secretary of State for the Home Department if he will make a statement about the progress in setting up neighbourhood watch schemes in shire counties.
    Mr. Giles Shaw: In December 1985 there were some 3,850 neighbourhood watch schemes operating in shire counties, which was more than double the number recorded in January 1985.
    Mr. Colvin: That is indeed good news, but does my hon. Friend agree that chief constables are probably wise to proceed cautiously with neighbourhood watch schemes, perhaps on a pilot scheme basis, in order to ensure that they have the wholehearted support of the general public, without which the schemes will not only fail but could be an additional drain on police resources, which are scarce? Where the schemes are proven to be effective, will he consider increasing police establishments to enable more schemes to be set up, because neighbourhood watch schemes may help prevent crime and catch criminals, but they require additional policemen?
    Mr. Shaw: I am very sensitive to my hon. Friend's point. Those neighbourhood watch schemes which are stimulated from within the community, arising perhaps from consultative councils such as that which is being established at Eastleigh in my hon. Friend's constituency, may well not be as manpower intensive for the police as those which are established under police intiation. However, I accept my hon. Friend's point that, like so many other police activities, all should be assessed in relation to police establishments.
    Mr. Alex Carlile: Does the Minister accept that neighbourhood watch schemes may have considerable value in some areas, but that the public are provided with far better protection if people living in rural areas can see the occasional policeman walking through their village or small town? Will he take steps to ensure that chief constables are aware of their responsibility to have more policemen on foot in the shire counties?
    Mr. Shaw: The hon. and learned Gentleman should be aware that my right hon. Friend the Secretary of State has invited chief police officers in all counties and, indeed, in the metropolitan areas, to make representations in relation to establishment, and he is currently considering many applications. Neighbourhood watch schemes and all the other activities that are mounted around those schemes have resulted in a welcome reduction in burglaries and I hope that that will be applicable in rural areas as well.
    Mr. Rathbone: May I put the question of my hon. Friend the Member for Romsey and Waterside (Mr.
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    Colvin) in a slightly different way? Is my hon. Friend sure that insufficient numbers of policemen are not holding up the introduction of the schemes in many places?
    Mr. Shaw: We are concerned at having sufficient police available, amongst other things, to enable us to stimulate crime prevention measures such as neighbourhood watch schemes. There is a role here for special constables, which we are currently examining.
    Mr. Clelland: Is the Minister aware of the excellent neighbourhood watch scheme set up in the Northumbria police force area, which, along with the metro transport system, the new metro shopping development and the setting up of regional drug squads, has placed considerable pressure on manning levels in that police force? When will the Home Secretary reply to the request from the Northumbria police authority in letters dated 22 January and 15 April for an increase of 75 in the manning of the Northumbria police force?
    Mr. Shaw: I am aware that Northumbria, amongst others, has made an application, and I know that each of those applications must be, carefully considered. We shall respond to that application, as to the others, as soon as possible.
    Mr. Conway: Is my hon. Friend aware of the progress which has been made in Shrewsbury with the neighbourhood watch scheme? Is his Department encouraging chief police officers to expand the special constabulary and to link them in with the neighbourhood watch schemes? That would increase the number of foot patrols in shire areas.
    Mr. Shaw: We are requiring all chief constables to take a view of all their resources. My hon. Friend will be aware that the numbers in the special constabulary are entirely a matter for the individual chief constable. There is little doubt that they would be a useful adjunct to crime prevention activities.
    Mr. Skinner: Will the Minister take into account the fact that there ought to be neighbourhood watch schemes in the counties of Oxfordshire, Cambridgeshire, Suffolk, Berkshire and all those areas where the Americans have bases? We need people to keep an eye on the criminal activities of President Reagan and those who allowed him to bomb Libya and other countries—
    Mr. Speaker: Order. That is very wide of the question.
    Mr. Skinner: If the Government will not keep an eye on him, somebody has to do it.
    Mr. Shaw: I suspect that that is a little outwith the neighbourhood over on which I was answering questions.

    Sexual Offences
    Mr. Michael McNair-Wilsonasked the Secretary of State for the Home Department when he now intends to introduce legislation to reform the Sexual Offences (Amendment) Act 1976 as it relates to the anonymity of those accused of rape.
    Mr. Mellor: We have this matter under consideration. There is a strong case for removing the accused person's right to anonymity, but a final decision has not yet been reached.
    Mr. McNair-Wilson: Although I welcome my hon. Friend's answer, does he agree that as the Act now stands

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    suspected rapists, alone of any criminals, enjoy anonymity? It is inequitable that anonymity, which should rightly be given to the victim, should also be given to a suspected person, especially when there is a danger of that suspected person committing other rapes, since he has not been arrested.
    Mr. Mellor: I entirely agree with my hon. Friend.
    Mr. Ashley: The Minister may be aware that I brought in the original Bill to help rape victims, and I sympathise with the Government's view. I wonder whether the best way to approach this matter is to preserve anonymity for men accused of rape, because it is such an appalling crime, but to identify men accused of it when they have committed another crime. Would that not be the best solution?
    Mr. Mellor: It is a halfway house. It is true that rape is a grave crime, but so, too, are murder, attempted murder, buggery, and assaults on young children, all of which lead to the identification of the defendant. The right hon. Gentleman will have read what the Criminal Law Revision Committee said about the provisions for the anonymity of defendants and its detailed criticisms. We must bear in mind the committee's findings as well as the right hon. Gentleman's comments when considering this matter.
    Sir Peter Hordern: When will my hon. Friend announce his decision? Will he give us an assurance that it will be made in a much shorter time than the decision about dog licences?
    Mr. Mellor: I have responsibility for a number of interesting matters but, happily, dog licences are not among them. I know what my hon. Friend means and I can assure him that a decision will be made in such a fashion that, if it is favourable to remove anonymity, that could be included in the Criminal Justice Bill next Session.
    Mr. Corbett: Given that there is no centrally held evidence that the anonymity provisions of this Act—which started life as my private Member's Bill—have in any way inhibited police inquiries, will the Minister at least undertake to consult widely on any plans to remove the anonymity provision for the accused man? Is the Minister prepared to advance the time at which the complainant woman gets the protection of anonymity to when that complaint is made?
    Mr. Mellor: I know that the hon. Gentleman has previous convictions on this subject—[Laughter.]—and I shall want to have a word with him about that in due course. I take his point about the anonymity of the victim. Recent events in Ealing have revealed to us how unsatisfactory it is that anonymity for the victim comes into play only at the point when an arrest is made, although we saw in that case that the damage can be done before then. I shall want to look into that matter and to have a word with the hon. Gentleman about it.

    Police (Training)
    Mrs. Clwydasked the Secretary of State for the Home Department what increased provision has been made for police training in respect of additional discretionary powers to be conferred on the police under public order legislation.
    Mr. Giles Shaw: The Department is in close touch with chief officers of police about the training implications of the Public Order Bill, but clearly this will depend on the final form of the Bill when it completes its parliamentary passage.
    Mrs. Clwyd: But why force these powers on the police in the first place? They do not want them. They bring the police into party politics. The Chief Constable of the Royal Ulster Constabulary has asked for similar powers to be taken from him. If the Government are so insistent, why not do this through the democratically elected local authorities, as in Scotland?
    Mr. Shaw: The hon. Lady will bear in mind that the Bill emanated from a review by a commission, the publication of a White Paper and from substantial discussion of the need to modernise the Public Order Act 1936. The Bill also has the approval of the House and is making progress. I look forward to the Bill continuing to make progress in the House.
    Mr. Kaufman: Bearing in mind that at times 7 per cent. of the Metropolitan police force are on duty at stalag Wapping to facilitate the distribution of what Mr. Rupert Murdoch laughingly describes as his newspapers, and bearing in mind also the 17 per cent. crime clear-up rate in London, what additional resources are the Government providing for the Metropolitan police to assist them in carrying out their proper duty of coping with the record crime wave in London?
    Mr. Shaw: I assure the right hon. Gentleman that the requirements placed upon the Metropolitan police to deal with public order matters are very broad and wide. They are not confined to what is happening at Wapping. The right hon. Gentleman knows full well that there is a substantial requirement for public order policing, whether it be at international soccer matches at Wembley or protecting persons from difficulties while processions and marches pass through the City. I assure him also that the request of the Commissioner of Police of the Metropolis for increased manpower is currently receiving very substantial consideration.
    Mr. Greenway: Are not the Government putting twice as much, in real terms, into police resources to enable them to do their job as the last Labour Government provided for the police? The Opposition Front Bench spokesman does nothing but attack the police in vicious and unpleasant ways. In doing so, he is in line with the former Labour-controlled Greater London council and the Labour police committees that are to be found throughout the metropolis.
    Mr. Shaw: My hon. Friend is quite right. By the increase from £1·1 billion to £2·8 billion this Government have demonstrated their determination to improve police resources. The thoughts of the right hon. Gentleman made the front page of The Times the other day. When he talks about police firmness and effectiveness, he might at least start by advising those members of his party who are in control of London boroughs that they should take a more effective view of the police than they do now.

    Police (Compensation)
    Dr. Marekasked the Secretary of State for the Home Department whether he will introduce a scheme to compensate police officers or their families injured or killed in the course of their duties.
    Mr. Giles Shaw: Special provision is already made in the police pensions scheme for police officers who retire as the result of injury on duty and for the dependants of those who die from such injuries.
    Dr. Marek: How can the Minister sit on the Treasury Bench with equanimity when the Government of which he is a member pursue policies which in recent times have led to an unparalleled increase in crime and violence in our society? How can he sit on that Bench and expect our policemen and policewomen to carry out his laws when they have to rely, if they are injured, on completely unsatisfactory pension schemes and completely unsatisfactory compensation from the Criminal Injuries Compensation Board? The Minister knows that it is high time that something was done about it.
    Mr. Shaw: The hon. Gentleman must recognise that the pension scheme provisions that are made for the police are substantial. The widow of a police officer who dies as a result of injuries on duty is entitled to a pension of 45 per cent. of her husband's average pensionable pay. If he died in special circumstances, such as attempting to save life, his widow's pension would be 50 per cent. of her husband's pensionable pay. The hon. Gentleman is aware that many other substantial benefits are available to deal with the situation. However, may I take him firmly to task for believing that we should be any the less committed to ensuring that there is proper policing of public disorders, purely because there is the real difficulty of dealing with officers who, on many occasions, face substantial injury as a result of looking after the public peace on behalf of many right hon. and hon. Members and the people outside Parliament.
    Mr. Bill Walker: Will my hon. Friend, when looking into the matter of police compensation, consider the dramatic changes that are occurring, with the growth of terrorism, in the tasks of our police and others working in the public service?
    Mr. Shaw: I share my hon. Friend's concern, and I know that compensation for injuries, which do not necessarily lead to retirement, is a matter for current discussion between the Police Federation and my Department.
    Mr. Loyden: Will the Minister examine the long delays in settling criminal injuries compensation cases? For instance, a policeman injured in the Toxteth riot had not received settlement after three years. Is that situation satisfactory?
    Mr. Shaw: I assure the hon. Gentleman that every case that comes before the Criminal Injuries Compensation Board will be most carefully and speedily dealt with, because we all recognise the importance of ensuring that proper payment is made.
    Sir John Farr: Will my hon. Friend assure me that the malicious damage that has occurred to the homes of police officers in certain parts of the country will be properly considered? Will compensation be given to officers who lose not only their homes but their belongings as well?
    Mr. Shaw: I would like from my hon. Friend details of that occurrence. It may be that it occurred in a part of the United Kingdom with which I am not very familiar.
    Mr. Campbell-Savours: What about compensation for families of police officers in Northern Ireland who have died at the hands of paramilitary groups? Why do the Government not interfere with the sourcing of money to fund those groups? What can the Minister say about what happened in The Hague yesterday, when the Home Secretary was approached by Mr. Alan Dukes, the Irish Justice Minister, who asked the British Government to act to ban kidnap insurance as it affects Ulster? What will the Government do about these matters—sit on their backside as usual?
    Mr. Shaw: The first thing that the hon. Gentleman might do is to vote in favour of the prevention of terrorism legislation. He has the effrontery to attack the Government for doing what they have done, when, consistently, the Labour party has voted against that. On the question of my right hon. Friend's motives in consulting other security Ministers on the matter, the hon. Gentleman has made remarks that are scarcely worth even ignoring.
    Mr. Peter Bruinvels: Will my hon. Friend consider the plight of police drivers who, in answering 999 calls or hoax calls, are involved in car accidents? As a result, many of them are off work for many weeks, and some, unfortunately, die. Will the Minister guarantee that payment for the relatives of those police officers, who were doing their best to protect our country, will be speeded up, because many of them are still waiting for such payment?
    Mr. Shaw: I assure my hon. Friend that an officer who retires as a result of an injury on duty—and that includes response to calls as described by my hon. Friend—is entitled to an ill-health pension, an injury pension, and an injury gratuity. If totally disabled, he is also entitled to a lump sum payment of five times his pensionable pay.
    Mr. Soley: Does the Minister accept that his miserable and evasive replies on this question demonstrate that the Government have no concern for the police other than in words? Is it not a fact that the Criminal Injuries Compensation Board and the private insurance pension schemes available for the police are grossly inadequate for many of the injuries and deaths that occur? Does he not agree that the Criminal Injuries Compensation Board takes far too long and delivers far too little?
    Mr. Shaw: I understand that when the hon. Member for Hammersmith (Mr. Soley) seeks to try to reassert his new-found interest in protecting the police he is looking for ways and means of doing so. I assure him that this Government have done a lot to improve police pay and conditions. I accept that there may be a case for further improvement, but he will recognise that, in relation to public service provision, that which is now available to the police service represents the top that can be paid.
    Mr. Hume: Is the Minister aware, following the question of the hon. Member for Workington (Mr. Campbell-Savours), that previously in the House the Prime Minister has agreed with me that the ransom insurance that exists in this country encourages kidnap and ransom? In the light of the Prime Minister's answer, can the Minister say why nothing has been done to—
    Mr. Speaker: Order. That is very wide of the subject, but the Minister may answer the question.
    Mr. Shaw: I take note of the hon. Gentleman's proposal. I should like to invite my right hon. Friend to write to the hon. Gentleman about that provision.

    Drugs (Customs Investigators)
    Mr. McCrindleasked the Secretary of State for the Home Department what steps he proposes to take to encourage the public to use the new telephone lines to Customs drugs investigators.
    Mr. Mellor: Customs and Excise has already taken steps to encourage the public to use the new Freefone facilities. There was a press launch on 7 April, posters and leaflets have been distributed; and all Customs regional offices have instructions to publicise the facilities. In the first 11 days of operation 353 calls were received, and some very good leads have been established.
    Mr. McCrindle: I thank my hon. Friend for that encouraging reply. Are there any plans to publicise the scheme by using posters in post offices? Many members of the public go into post offices, and the use of such posters might contribute even more to the success of the scheme.
    Mr. Mellor: There have been negotiations between Customs and the Post Office. At first they appeared unpromising, because the Post Office initially seemed to want to impose a fee to display the posters. This morning I discussed the matter with the chairman of the Post Office. I hope that more positive counsel will be given to those conducting the negotiations.
    Mr. Haynes: It is all right for the Under-Secretary of State to talk about involving the general public with a special telephone line, but when will the Government reinstate the Customs officers they have sacked since 1979 and really do something about that problem?
    Mr. Mellor: The hon. Gentleman will have to find another basis for his outrage, because some 500 extra preventive staff—[Interruption.] That was not an invitation to show further outrage. A further 500 preventive staff are to be recruited in the period April 1985 to April 1987.
    Mr. Rathbone: Although I welcome the scheme, does my hon. Friend agree that it will come to nothing if Customs officers are not placed where they can track down the places from which drugs are smuggled, especially in Bombay? Will my hon. Friend report on the Government's efforts to get Customs inspectors there?
    Mr. Mellor: It is troubling that so much of the heroin arriving in this country has been dispatched from India. The proportion last year was 49·1 per cent. of all heroin seized. The trends in the first three months of this year show that perhaps as much as two thirds of the heroin seized by Customs has been dispatched from India. I understand that my right hon. and learned Friend the Foreign and Commonwealth Secretary discussed those matters with the Prime Minister and Foreign Minister of India during his recent visit. I hope that the good level of co-operation that has been established between the law and order services in Britain and those in India will be
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    furthered by the placement of drug liaison officers, who have done so much to cut the trade in heroin between Pakistan and the United Kingdom.
    Mr. Frank Cook: What controls of that kind have applied at United States military bases in Britain?
    Mr. Mellor: United States military bases are under the control of internal United States security services, which take action against personnel on bases who are found dealing with drugs.
    Mr. Spencer: Does my hon. Friend agree that there is a foreign element in an increasing number of cases coming before the courts, which shows the importance of the Government liaising with foreign Governments to stamp out the supply of drugs at its source?
    Mr. Mellor: That is absolutely right. That is why we take so seriously the bilateral relations that we have with a wide range of countries which produce drugs which are exported to the United Kingdom. That is also why we take seriously Britain's role as chairman of the Pompidou group of Ministers in Europe, which is concerned with drugs. International co-operation on drugs is not an option, but a necessity.

    Overseas Representatives (Fascist Parties)
    Mr. Winnickasked the Secretary of State for the Home Department what is his policy on the admission to the United Kingdom of elected representatives from other countries who belong to Fascist parties.
    Mr. Waddington: Cases are considered individually in accordance with the immigration rules.
    Mr. Winnick: If it was right for the Home Secretary to prevent an American from coming to Britain recently—and I believe that the Home Secretary was absolutely right—why should elected representatives of Fascist parties, for example, those elected in France and one Nazi elected in Israel, be allowed to come to Britain to spread their racial mischief and poison?
    Mr. Waddington: Every member of the Government abhors racism, but to prevent anyone coming here just because he belongs to a party to which racist views are attributed does not seem to be justifiable. Clearly it would be another matter if he were coming here to propound racist views. Any question of excluding M. Le Pen would have to be considered in the light of the circumstance prevailing at the time and would have to take account of the fact that he enjoys certain immunities and privileges by virtue of being a Member of the European Parliament. MEPs are not liable to detention in a member state while the Assembly is in session; nor can MEPs be hindered when travelling to or from the Assembly.
    Mr. Adley: While I would not wish to be associated with the point that the hon. Member for Walsall, North (Mr. Winnick) has made, will my hon. and learned Friend nevertheless consider the fact that it was an election by proportional representation, which seems to encourage the election of people with extremist views to Parliament?
    Mr. Waddington: I am sure that my hon. Friend is right to bring that to the attention of all of us and point out one of the follies that would result from the introduction of proportional representation in this country.
    Mr. Mallon: Is the Minister aware of the underlying Fascist influence on events taking place in Northern Ireland, and that already members of a Fascist organisation have appeared in court in Northern Ireland on charges related to violence? Will he assess the relationship between that Fascist party and parties that are represented in this House?
    Mr. Waddington: This question is directed to the admission of people to the United Kingdom. The matter raised by the hon. Gentleman does not bear on that problem.

    Terrorism (Toxic Chemicals)
    Mr. Bill Walkerasked the Secretary of State for the Home Department what detection equipment will be available to police and fire services and local authorities to monitor the presence of toxic chemicals in the event of terrorist use of chemical weapons or materials.
    Mr. Giles Shaw: It would not be in the interests of security to disclose details of the equipment which might be deployed to combat terrorist activity.
    Mr. Walker: While I thank my hon. Friend for that reply, may I ask whether he agrees that, in the light of state-sponsored terrorism and the fact that weapons of this kind are becoming much more sophisticated, the action taken in the last week or two has been valuable in dealing with the matter? Does he further agree that it is important to see that we are equipped to deal with such action properly and effectively should it ever happen?
    Mr. Shaw: I think my hon. Friend is right to say that in the present climate of Government-backed terrorism every possible contingency should be covered, and I wish to give my hon. Friend the assurance that contingency plans exist for dealing with a whole variety of possible terrorist activities.

    Prison Services (Privatisation)
    Mr. Thurnhamasked the Secretary of State for the Home Department if he will estimate the likely savings during 1986–87 from contracting out of services by the prison authorities.
    Mr. Mellor: The cost of services contracted out by the prison department in 1984–85—the latest financial year for which figures are available—was £55 million. Because most of the work has been contracted out for a number of years, we cannot provide a sensible estimate of the savings involved.
    Mr. Thurnham: Does my hon. Friend agree that the use of more contracted-out services should not only lead to more savings but reduce the likelihood of industrial disputes?
    Mr. Mellor: As a general principle, I am sure that there is a great deal in what my hon. Friend says. He will know of the special difficulties in the prison service, part of which is that a number of prison services are provided for the benefit of the regime by the prisoners themselves.
    Mr. Hoyle: Can the Minister say what savings have been made by allowing 49 prison officers' houses in Culcheth, Warrington to stand empty for the last five years?
    Mr. Mellor: Not without notice, Sir.

    Burglaries
    Mr. Boyesasked the Secretary of State for the Home Department, for England and Wales, what was the number of burglaries in 1985 which were notified to the police but which were not cleared up.
    Mr. Mellor: The estimated number of offences of burglary in England and Wales recorded by the police in 1985 but not cleared up is 616,000. Because an offence may be recorded and cleared up in different years, it is not possible to give an exact figure.
    Mr. Boyes: Is that figure not absolutely incredible, disgraceful and disgusting? Has the Minister seen the video produced by the Labour party, which shows that in our campaign we put people first? We will put more police on the beat to protect the people on the streets and in their homes.
    Mr. Mellor: I think that there is a career in the music hall for the hon. Gentleman if he thinks that such stuff will be taken seriously. If he is interested in videos and in the credibility of the Labour party, he should look at the GLC-funded video which ended with the words,
    "Communities must rebel."
    The Labour party will not be taken seriously on the issue until it gets behind it the Labour council leaders who are leading anti-police campaigns. It must do that before it tries to persuade the rest of us.
    Mr. McCrindle: On a more sober note, does my hon. Friend recall the Prime Minister's suggestion to insurance companies some months ago that they should be prepared to offer discounts on premiums in return for the installation of burglar alarms and other protection? Has he any indication from insurance companies that they have attended to the matter, and is he keeping in contact with them with a view to achieving what my right hon. Friend suggested?
    Mr. Mellor: Yes. On an equally sober note, two insurance companies are already doing so, which is very good news.

  PRIME MINISTER

    Engagements
    Mr. Eadieasked the Prime Minister if she will list her official engagements for Thursday 24 April.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in this House I shall be having further meetings later today. This evening I shall attend a state banquet given by Their Majesties the King and Queen of Spain.
    Mr. Eadie: Has the Prime Minister had time to reconsider the statement that she made in the House last Tuesday to the effect that the Americans would choose the type of weapons that they would use on aircraft taking off from British bases? If she has had time to reconsider that, does she adhere to the statement that she made on Tuesday?
    The Prime Minister: I made it perfectly clear on Tuesday that we had set down very strict criteria for the use of F11 1s from British bases in this country. Those

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    strict criteria were in the statement that I made, and added to those strict criteria was the duty to minimise civilian casualties. Therefore, it is clear that we were considering only conventional weapons. Nuclear weapons would require totally different procedures. It is absurd to say that they were ever asked for. Within the strict criteria that we laid down, the precise choice of weapons in the conventional sphere was for the United States.
    Sir Peter Hordern: Since both the Italian and French Governments are liberalising their exchange controls, and since all the criticisms made by Professor Alan Walters in The Times have either been met or are unfounded, is it not time that we joined the European monetary system?
    The Prime Minister: I did not read Professor Alan Walters' book in quite that way. As my hon. Friend knows, it is our policy that we shall one day join the European monetary exchange mechanism, but we do not believe that the time is yet right.
    Mr. Kinnock: President Reagan made two speeches yesterday in which he emphasised that he is prepared, as he put it, to act again against Libya. Will the Prime Minister tell us frankly whether she would be prepared to endorse or assist in a further similar raid?
    The Prime Minister: I have already answered that question several times. Should there be a further request, it would have to be considered. We would reach our conclusions in the light of circumstances and matters which would have to be considered at that time.
    Mr. Kinnock: Has the Prime Minister read the interview given by the Secretary of State for Defence to Mr. Terry Coleman, which appeared in The Guardian this morning, in which the Secretary of State said:
    "It wasn't our decision to do it, …If that question had been put to us, I don't know quite what response we'd have given."
    If the President of the United States should again present the Prime Minister with such a fait accompli and say that he will go ahead whatever her opinion, what will be her response?
    The Prime Minister: I have already answered the right hon. Gentleman's question, if only he would listen.
    Mr. Kinnock: The Prime Minister has not answered that question. She is trying to claim that she has somehow mitigated the nature and effects of the American raid. Is it not the case that she has now moved into the worst of all worlds, demonstrating both complicity and impotence?
    The Prime Minister: What the right hon. Gentleman is seeking to do is to help the terrorists by letting them know exactly what answer we shall give to a request. I have already told him that if a request were received we would have to consider it in the light of the circumstances at the time.
    Mrs. Currie: Has my right hon. Friend had time to read the statements by the Advocate General of the European Court of Justice in the case of invalid care allowances? Will she accept that married women who care voluntarily for disabled relatives at home have much sympathy on both sides of the House? Could not the Government, who do care for the carers, consider making this payment available?
    The Prime Minister: As my hon. Friend is aware, the judgment in that case will not be given until about June. When it arrives we shall, of course, consider it carefully and the reasons for it.
    Mr. Maclennanasked the Prime Minister if she will list her official engagements for Thursday 24 April.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Maclennan: Further to the answer that the Prime Minister gave to her hon. Friend the Member for Horsham (Sir P. Hordern), does she agree that the exchange rate is now within the central band and that the European monetary system can be adjusted to include us without a major realignment? In view of the strong arguments advanced by Sir James Cleminson, the president of the CBI, concerning the advantage to British industry of entering the mechanism now, should she not listen to the senior members of her Cabinet, who favour entry now; and stop playing this one-man band record on the subject?
    The Prime Minister: No. I outlined the general policy to my hon. Friend the Member for Horsham (Sir P. Hordern). The time is not ripe to join the EMS. Just because the exchange rate is in a certain band now does not mean that it will stay there. If it did not, one would either have to use scarce reserves artificially to keep it within that limit, or one might be driven to put up the interest rate. We would be much more circumscribed within the EMS mechanism than we wish to be at the moment.
    Sir Peter Tapsell: While we are on the EMS issue, will my right hon. Friend bear in mind that some of us would prefer to have our affairs managed by the Bank of England rather than by the Bundesbank?
    The Prime Minister: I note what my hon. Friend says. I have already said that to join it at the moment would limit our freedom of action, and that is not desirable at present.
    Mr. Flannery: Has the Prime Minister noticed the statements that President Reagan has made about Iran and Syria—almost threatening them with the same thing that was done to Libya? Has she also noticed how few Americans are coming over here and that people are deeply worried by the fact that the President of the United States seems to have lost his mind about this business and is literally threatening all mankind with what he will do next if terrorism breaks out anywhere?
    The Prime Minister: As the hon. Gentleman is aware, the objective is to fight terrorism. If one always rejects the use of force to fight terrorism, the terrorist wins and the consequences for more victims are horrific.
    Sir John Farrasked the Prime Minister if she will list her official engagements for Thursday 24 April.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Sir John Farr: While the whole House goes along with the "Viva el Rey" speech by Mr. Speaker yesterday in another place, can my right hon. Friend assure the House that there will be no change in the sovereignty of Gibraltar, and certainly no change without the consent of the people in that colony?
    The Prime Minister: I agree with my hon. Friend. The whole House and, I think, the whole country welcomes the

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    state visit of Their Majesties the King and Queen of Spain. It is a great success. We know full well Their Majesties' views on Gibraltar. As my hon. Friend is aware, the Government have given assurances to the people of Gibraltar that Gibraltar will remain part of Her Majesty's dominions unless and until an Act of Parliament otherwise provides, and furthermore that Her Majesty's Government will never enter into arrangements under which the people of Gibraltar would pass under the sovereignty of another state against their freely and democratically expressed wishes.
    Mr. William Shelton: Is my right hon. Friend aware that when the 30 or more Labour councillors were disqualified at Lambeth they left a rump of three councillors to run Lambeth council? Is she aware that a meeting tomorrow night—[Interruption.]
    Mr. Speaker: Order. The question must involve the Prime Minister's responsibility.
    Mr. Shelton: Is my right hon. Friend aware that there is to be a meeting tomorrow night to reverse the position? Will she condemn the use of force, which I understand will be employed to break up that meeting, and, indeed, any use of force in public life?
    The Prime Minister: I think that we would all unhesitatingly condemn any use of force to break up that council meeting. I hope that it takes place tomorrow night and that the Conservatives take over the authority of the council.
    Mr. Tony Banks: In the discussions between representatives of the American Government and Her Majesty's Government about bombing targets in Libya, did the Americans at any time say that one of the objectives was the killing of Colonel Gaddafi?
    The Prime Minister: No, of course not.
    Mr. Loydenasked the Prime Minister if she will list her official engagements for Thursday 23 April.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Loyden: Will the Prime Minister comment on a report that the Tory candidate in the by-election at Ryedale made a statement at a press conference this morning to the effect that we are at war with Libya? Does the Prime Minister approve of that, and does it reflect the attitude of the Government?
    The Prime Minister: No, that is not correct. Of course, terrorism itself—[HON. MEMBERS: "Answer."] If hon. Gentlemen had had the courtesy to listen, they would have heard what I said. They do not have the courtesy to listen, or courtesy of any other sort. Terrorism is a form of warfare against all other citizens in democratic societies.
    Mr. Thurnhamasked the Prime Minister if she will list her official engagements for Thursday 23 April.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Thurnham: Does my right hon. Friend agree that the voluntary licensing authority should be congratulated on its first year's work in monitoring IVF clinics and research laboratories, work in which this country leads the world in setting the very highest ethical standards?
    The Prime Minister: I am aware of my hon. Friend's great interest in this matter. I noted that the first report had been published, and I hope that it will be widely studied, because the organisation's work is excellent.
    Dr. Owen: Can the Prime Minister assure the House that the Government are taking every step possible to co-ordinate other countries' actions in refusing Libyan aircraft facilities to land at our airports, and that we are now prepared to adopt sanctions against Libyan air flights both in and out of this country?
    The Prime Minister: I think the right hon. Gentleman is aware that if some of the deportees about whom my right hon. Friend the Home Secretary spoke to the House are to go, they will probably have to do so on Libyan aircraft. He is also aware that there are a number of our citizens in Libya, some of whom may want to get out on other aircraft.
    Mr. Gregory: In view of the act of terrorism today and the others that we have experienced in Europe so recently, will my right hon. Friend encourage as many Americans as possible to follow their colleagues last year and come to this country to see that it is the safest in the EEC? Will she also give support to the British Tourist Authority in promoting Britain overseas?
    The Prime Minister: Yes, I gladly support my hon. Friend and my right hon. Friend the Secretary of State for Employment, who is also responsible for tourism. He is doing everything that he can to promote in the United States our tourist industry. My hon. Friend may have heard what someone from the American embassy said this morning—that he hoped that more American tourists would come to this country, which is a safe and good country.
    Mr. Fisherasked the Prime Minister if she will list her official engagements for Thursday 24 April.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Fisher: Does the Prime Minister agree with her Secretary of State for Defence, who is reported in the papers this morning as saying that the precise position and the precise targets were not agreed, and he was not informed about them? Will the Prime Minister tell the House whether she did have precise detailed information of the targets that were to be bombed, or is the special relationship that she has with President Reagan more one of master and servant?
    The Prime Minister: I have answered that question in previous statements and speeches. I made it perfectly clear that the Government agreed to the use of United States aircraft based in the United Kingdom if that was necessary in the action of self-defence against specific targets, demonstrably involved in the conduct and support of terrorist activities. We laid down strict criteria. I notice that the hon. Member, like so many of his colleagues, does everything to try to undermine the fundamental relationship between Europe and the United States.
    Mr. Kinnock: On a point of order arising directly from questions, and because it is a complete calumny, I want to ask through you, Mr. Speaker, if the Prime Minister will unreservedly withdraw her statement, made in the heat of

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    Question Time, that I am seeking to help terrorists? That is utterly unjustified, and a vile insult, that is not even acceptable in the bitterest of exchanges in this place.
    Mr. Speaker: Order. If the Prime Minister did say that, and I must confess that from where I was sitting I did not hear it, I am sure that she would wish to correct it.
    The Prime Minister: May I make it perfectly clear what precisely, I believe, I did say. I said that if one tells the terrorists precisely what one is, or is not going to do, that is the way to help him. I did not seek to impute anything personal to the right hon. Gentleman, and if that was the effect of what I said, I gladly withdraw it.
    Sir Eldon Griffiths: Further to that point of order, Mr. Speaker. There are rights in this House that belong to hon. Members other than the Leader of the Opposition and the
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    Prime Minister, and we are entitled to look to you, to safeguard the rights of all Members of this House. It is within the knowledge of all Members that recently statements have been made in the course of questions and answers, and hon. Members have risen to object. It has been the convention, in my experience in this House, that Mr. Speaker will not allow time to be used for hon. Members to object to comments. I ask a simple question—why have you allowed, on a point of order, a statement from the Leader of the Opposition that you would not have allowed from any other hon. Member?
    Mr. Speaker: Order. If the Prime Minister or any other hon. Member, casts an aspersion on the honour of any other hon. Member, I will always apply the rules. I am the guardian of Back Benchers as much as of Front Benchers, and the same rules apply to everyone.

Business of the House
Mr. Neil Kinnock: May I ask the Leader of the House to state the business for next week?
3.32 pm
The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): Yes, Sir. The business for next week will be as follows:
MONDAY 28 APRIL—Until Seven o'clock, Second Reading of the British Shipbuilders (Borrowing Powers) Bill.
Motion on the Industrial Training Levy (Engineering Board) Order.
The Chairman of Ways and Means has named opposed Private Business at Seven o'clock.
TUESDAY 29 APRIL—Second Reading of the Finance Bill.
Motion on the statement on the New Workers Scheme.
WEDNESDAY 30 APRIL—Remaining stages of the Public Order Bill.
THURSDAY 1 MAY—Opposition Day (13th Allotted Day) there will be a debate on an Opposition motion entitled "Family and Community Care—Putting People First".
Motion on the Agricultural and Horticultural Co-operation Grants (Extension of Period) Order.
The Chairman of Ways and Means has named opposed Private Business at Seven o'clock.
FRIDAY 2 MAY—Private Members Bills.
Mr. Kinnock: I am grateful to the Leader of the House. Next Monday the House will debate the Second Reading of the British Shipbuilders (Borrowing Powers) Bill. Because of the widespread interest and concern about the future of the shipbuilding industry, will the right hon. Gentleman ensure that the Bill is committed to a Committee of the whole House?
Next Thursday, my party will use an Opposition Day to debate the problems of people involved in family and community care. Unfortunately, that debate must, by definition, be a short one. In the light of today's ruling by the European Court of Justice that the Government's refusal to pay invalid care allowance is a breach of EEC law and an example of sex discrimination, will the right hon. Gentleman arrange for a debate in Government time on this matter, which affects 5 million people caring for sick or disabled relatives at home?
Differences have become evident between the Prime Minister and the Secretary of State for Defence about the information given to the Government at the time of the bombing raid on Libya. Will the right hon. Gentleman therefore arrange for the Secretary of State for Defence to make a full statement to the House next week about what he knew, when he was told, and whether he understood what he was told?
Finally, in view of the decision by American businesses and individuals to cancel visits to Britain and other European countries in the latter part of this year as a result of the bombing of Libya, would the right hon. Gentleman arrange for the Secretary of State for Trade and Industry to make a statement in the House next week publicising the fact that, even with the terrorist menace, European cities and countries are safer than American cities? Could he not, for instance, draw attention to the fact that the murder rate in San Francisco is five times higher than it
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is in London, in New York 10 times, in Dallas and Washington 14 times and in Detroit, 22 times higher? London and the rest of Europe are much safer places than the Americans appear to believe.
Mr. Biffen: I am grateful for the points made by the Leader of the Opposition. [Interruption.]
Such language. I feel that we are moving back to a more conventional state of incivilities.
I thank the right hon. Gentleman very much for his most eloquent, pertinent and convincing point about the greater safety of the cities of western Europe when compared with those of the United States, which should give every encouragement to the traditional pattern of tourist and commercial trade to flow from north America to western Europe.
I will draw to the attention of my right hon. Friend the Secretary of State for Defence the fact that his appearance in The Guardian today has excited widespread interest throughout the House. However, I would have thought that the comments that have been made, not least by my right hon. Friend the Prime Minister, have put the matter in context.
The right hon. Gentleman quite properly points out that Thursday's debate is one of great significance. I will of course consider through the usual channels his suggestion of a more general debate at some subsequent date. However, I am entitled to remind the right hon. Gentleman that no judgment has been made by the Court. The Advocate General has given an opinion, but we will have to wait some months for the court's opinion.
I can conclude on a cheerful note. I am delighted to accede to the right hon. Gentleman's request that the Committee stage of the British Shipbuilders (Borrowing Powers) Bill should take place on the Floor of the House.
Mr. Michael McNair-Wilson: It is now nearly six months since the Anglo-Irish agreement was signed. Does my right hon. Friend feel that the House should now have the chance to debate its usefulness and the progress that has been made, in view of the unhappy state of the Province?
Mr. Biffen: I will convey that expression of view to my right hon. Friend the Secretary of State for Northern Ireland.
Mr. David Alton: In view of the statements made yesterday during Environment Question Time, will the Leader of the House today reiterate his commitment that no decisions will be taken over the NIREX orders until there has been a full debate on the report of the Environment Select Committee on the disposal of nuclear waste? Will the right hon. Gentleman tell us when that debate will take place?
Will the right hon. Gentleman also tell us when there will be a debate on the Channel Tunnel Bill?
Mr. Biffen: The Channel Tunnel Bill should be before the House reasonably soon. The special development order will be laid as soon as the matters raised during the consultation period have been considered. I will be giving thought as to how best we might meet the wishes of the House in debating the order, as well as taking into consideration the relevant aspects of the Select Committee's report.
Several Hon. Members rose—
Mr. Speaker: Order. The House knows that there are three statements to be made after Business Questions. I must have regard for the other business on the Order Paper, so I will allow business questions to continue only for a further 15 minutes. I hope to be able to call every hon. Member if questions are brief.
Mr. Peter Bruinvels: Has my right hon. Friend seen the article in the Daily Mail for Monday 21 April, entitled, "Scandal of the Dole Queue Door Knockers"? It reveals that more than 600 people in the east midlands and other parts of the country are signing on for the dole and then moonlighting for the rest of the day, earning at least £40 a day. Will my right hon. Friend arrange for an early debate so that we can learn about those abuses and check on the arrangements for signing on, so that people cannot do that? Such a debate might reveal that the unemployment figures are not as serious as they appear to be.
Mr. Biffen: I have been so busy following my hon. Friend's fortunes in The Sun that I am afraid that I have neglected to read the Daily Mail. However, he has raised an important point that is widely seen as such. My hon. Friend may wish to consider raising it on Second Reading of the Finance Bill, as that would seem to be the best immediate prospect.
Mr. Greville Janner: Leaving on one side the abuses in The Sun and elsewhere, is not the greatest abuse to which the Leader of the House should turn his attention the enormous and persistent unemployment and the Government's fiddling of the figures for the east midlands and elsewhere? When will we next have a debate on unemployment in the east midlands?
Mr. Biffen: I think that I can safely say that the hon. and learned Gentleman will never make The Sun. I take note of the proposition that we have unreliable unemployment figures. There are lively schools of argument about the level of unemployment and the argument is made both ways. But just as I said to my hon. Friend the Member for Leicester, East (Mr. Bruinvels), the hon. and learned Gentleman may find that Second Reading of the Finance Bill is his best and earliest opportunity to raise that point.
Sir Fergus Montgomery: As my right hon. Friend said last week that there was little hope of reviving the Shops Bill, will he consider introducing legislation to bring Scotland into line with the rest of the United Kingdom? That would give Scottish Labour Members the opportunity to explain why their shopkeepers have a freedom that they deny to shopkeepers in my constituency?
Mr. Biffen: Bowing to your exhortation for brevity, Mr. Speaker, the answer must be no.
Mr. Jack Ashley: I did not follow the response of the Leader of the House to the request of my right hon. Friend the Leader of the Opposition about the European judgment on disabled people and married women receiving an attendance allowance. May we have a statement on that as soon as possible?
Mr. Biffen: When the right hon. Gentleman looks at tomorrow's Hansard, he will see that before I came to the Dispatch Box the point had already been made. At present,
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we still have the Advocate General's opinion, and we do not have the court ruling. The latter is not expected for some months.
Mr. Roger Sims: Has my right hon. Friend noticed early-day motion 748 on the subject of family courts, which has attracted 78 signatures within a few days?
[That this House welcomes the establishment of the Family Courts Campaign to promote the early implementation of family courts, following the support for family courts recently expressed by the Law Society, the Association of County Councils, the Association of Directors of Social Services and many other bodies; welcomes the recommendations of the report of the Matrimonial Causes Procedure Committee, particularly those relating to the establishment of conciliation in matrimonial proceedings; notes with concern that the report by the Law Commission on Family Law, Illegitimacy, has yet to be implemented; further notes that the joint study set up in July 1984 by the Lord Chancellor and the Secretary of State for the Home Department to re-examine the idea of a unified family court, and study the resources implications in terms of finance, manpower and accommodation is due to be published shortly; regrets that this study has been so long delayed; and urges the Lord Chancellor and the Secretary of State for the Home Department to come forward with proposals for legislation at the earliest opportunity, following the publication of their report and their subsequent consultation on the most appropriate model for implementation.]
Is my right hon. Friend aware of the mounting impatience among hon. Members and many organisations at the very protracted delay in the publication of the Government's study on family courts? May we expect a statement next week?
Mr. Biffen: I know that my right hon. Friend the Home Secretary and my right hon. and learned Friend the Solicitor-General will be anxious to consider responses to that idea before coming forward with any proposals. I shall most certainly draw my right hon. Friends' attention to the point made by my hon. Friend.
Mr. Roy Hughes: Will the Leader of the House arrange for an early debate on the report by the Select Committee on Transport on toll crossings, which was published some two months ago? Would that not give right hon. and hon. Members the opportunity to remind the Secretary of State for Transport that Britain now has some 4 million people unemployed and that many of the worst affected areas have toll crossings which are a restraint on trade?
Mr. Biffen: The hon. Gentleman will appreciate that it is usual for a Government response to have been made to a report of a Select Committee before there is consideration of a debate. However, I shall certainly look into the matter.
Mr. Jonathan Sayeed: Can we have an early debate on the extra cost of the Labour party's election bribes so that we can find out whether it will cost the taxpayer another £24 billion, £39 billion or £46 billion? [Interruption.]
Mr. Biffen: Opposition Members must not get so excited. I was overwhelmed by the modesty of my hon. Friend's observations. I feel that they can all be put to a helpful test on Second Reading of the Finance Bill.
Mr. Ron Brown: Many members of the Tory party are anxious to see that compensation is paid to victims of the bombing outrage during their conference—rightly so in my view. Will the Leader of the House ensure that there is a debate which looks at the position of compensation for the innocent victims of the recent bombing outrage by President Reagan? Will the right hon. Gentleman ensure that that is considered, because it is an important international issue?
Mr. Biffen: I do not think that I can helpfully add to what was said in the recent Adjournment debate on the Brighton bombing. As to the wider issues mentioned by the hon. Gentleman, the answer must be no.
Sir Kenneth Lewis: Now that the Leader of the Opposition has announced that the Labour party is half in mourning, by adopting grey in place of red as the party colour, will my right hon. Friend confirm that we are still true blue and very much alive?
Mr. Biffen: Yes. I think that there will be much entertainment during the next few weeks and months as the right hon. Gentleman the Leader of the Opposition leads his party towards the ground he wishes to share with social democracy. [Laughter.]
Mr. Frank Cook: Does the Leader of the House realise that his reply to the hon. Member for Liverpool, Mossley Hill (Mr. Alton), could be understood as meaning that the debate on the Select Committee report on radioactive waste could coincide with the laying before the House of the special development orders? Does he realise that there is such widespread nationwide anxiety about this issue that if he wants to mobilise opposition further that is the best way to do it? Will he give the House an assurance this afternoon that that is not the intention of the Government? It is not good enough.
Mr. Biffen: I gave a carefully considered answer. If I were to go beyond it, I would create ambiguity.
Mr. Barry Henderson: A number of hon. Members from the Conservative party also applaud the Select Committee on Transport's proposals to abolish tolls on estuarial crossings. It would be helpful to have a debate on that subject before the Government reply to the Select Committee report, so that the argument may be advanced that the main costs on providing those estuarial crossings was to continue the exceptional benefits to shipping on the estuaries rather than to provide exceptional benefit to local car users?
Mr. Biffen: I am grateful to my hon. Friend for making that point and emphasising that this is in no sense a party political issue. I hope that he will reflect that there are advantages in a Government reply being available on a Select Committee report before it is discussed.
Mr. Laurie Pavitt: Has the Leader of the House seen my early-day motion 773 about the very unfair procedures which are being adopted against the objectors who want to see Marylebone station remain open? It is on a line which affects more Conservative Members than Opposition Members.
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[That this House, noting that objectors to the closure of Marylebone station and the withdrawal of services thereto and therefrom have been unable to obtain information necessary to the full production of their cases against the closure, urges British Rail to make available to objectors details of the financial case for closure.]
If we cannot have a statement about that, will he draw it to the attention of the Secretary of State for Transport and persuade him that to receive a deputation from the mostly Conservative-controlled councils in order to discuss the rules and regulations governing the procedures for objectors who wish to keep the line open—as against British Rail, which wants to close it?
Mr. Biffen: As I understand it, that decision is essentially a matter for the board of British Rail, and it is still taking evidence and making judgments on that. However, the hon. Gentleman raises a point which I know he would wish me to convey to my right hon. Friend the Secretary of State for Transport; I will certainly do that.
Mr. Michael Fallon: Would my right hon. Friend arrange for an early Government statement on the alleged disappearance of the red flag? Has that item officially been reported as missing?
Mr. Biffen: There is a limit to the breathless ditching of symbols that can be undertaken even by a party that is thirsty and in a hurry for office. However, as far as the conventions of the House are concerned, my hon. Friend had better consider that the ambit of the Second Reading of the Finance Bill is, as always, mercifully wide, and he can slip his point into that debate.
Mr. Robert N. Wareing: In view of the Government's continued support for American state terrorism, not only in the central Mediterranean but in Nicaragua and Angola, is it not time that we had a general debate on foreign affairs so that we can specifically examine the so-called special relationship between the Prime Minister and President Reagan?
Mr. Biffen: I always enjoy the hon. Gentleman's contributions because they remind us that he at least is on the slow passage back to social democracy. I will certainly draw the hon. Gentleman's request for a debate to the attention of my right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs.
Mr. Geoffrey Dickens: Will my right hon. Friend the Leader of the House make time available to discuss the persistent and regular undermining of Her Majesty's Government position in terms of fighting for democracy and freedom against terrorism, which has continued since the Falklands crisis and which continues today? We should have the opportunity to expose those Labour Members who have so consistently tried to undermine the strict and decent stands that Her Majesty's Government are taking.
Mr. Biffen: My hon. Friend has made his point with such effectiveness that no added debate is necessary.
Mr. Andrew Faulds: In view of the very significant numbers quoted by my right hon. Friend the Leader of the Opposition in terms of homicides in American cities, could the Leader of the House find some way of publicising those figures, as all hon. Members want the health of the British tourist industry strongly maintained? In terms of American visitors, there is a

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strong incidental advantage in that, away from the malign influences of the American media, some American visitors begin to learn some of the political facts of life in the world today by visiting this country?
Mr. Biffen: I cannot comment on the hon. Gentleman's second point. In connection with his first point, I hope that he will join me in a sense of charity towards his right hon. Friend the Leader of the Opposition and a belief that when his right hon. Friend makes a good point that has sufficient validity to make its own publicity.
Mr. Michael Forsyth: In view of the concern about security, would my right hon. Friend arrange for an early debate, so that we can discuss the special relationships that seem to exist between some trade union leaders and Opposition Members, such as the hon. Member for Edinburgh, Leith (Mr. Brown), and the Libyan Government?
Mr. Biffen: I understand that the House would be interested in a general debate about security. However, in all charity to my hon. Friend, the debate should be brought into a more significant context than the activities of the hon. Member for Edinburgh, Leith (Mr. Brown).
Mr. Dennis Skinner: Will the Leader of the House consider allowing a debate, as I have suggested on several occasions during the past few weeks, on the position at Wapping? The Tory Members who support Murdoch and his newspapers would have the chance to explain why they support a man who has sacked 5,000 people and rid himself of the task of paying their redundancy pay. If the right hon. Gentleman will not allow such a narrow debate on Wapping, will he allow a more general debate on industrial relations, so that we can show the difference between the support for Murdoch and the treatment of the representative of the Transport and General Workers Union in this House who is not allowed two hours off during his working day to look after his trade union business?
Mr. Biffen: A number of people would enjoy a debate on Wapping, not least those who think that the behaviour on the trade union picket line is a clear sign that the unacceptable face of trade unionism has not yet been erased, and, what is more, who would like to reflect upon the motley crew who assemble as auxiliaries and subsidiaries, particularly at the weekend. They are a sign that rent-a-mob has not disappeared from ultra-Left politics. That is my contribution to the debate. All I can say is that its more expanded version, alas, cannot take place in the next week or two.
Mr. Terence Higgins: I apologise to my right hon. Friend for having had to leave the Chamber to take an urgent message immediately after his initial statement, but is he aware that the Select Committee on the Treasury and Civil Service will be producing a report on the Budget and the Finance Bill in time for the debate which is due to take place next week? However, it is inconvenient if it is announced that the Second Reading of the Finance Bill will take place on Monday, only to have that changed very much at the last moment. I hope that my right hon. Friend will not let that happen again.
Mr. Biffen: I express my gratitude for the first point that my right hon. Friend makes. It will be for the general
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enhancement of the debate that we have the observations of his Select Committee. As to his second point, I am sorry, but if that business has to move by a day, to have an extra day is less inconvenient than to be short of a day.
Mr. Paddy Ashdown: Has the Leader of the House seen the answer in today's Hansard which shows that the Government intend to abandon their moral responsibility towards the 11,500 ethnic minority in Hong Kong in terms of nationality, leaving them in a position where they will be citizens of one country with right of abode in another? When do the Government intend to bring the order providing for that disgraceful position before the House for debate?
Mr. Biffen: I have not seen that answer, but I shall consider the appropriate timing for such a debate through the usual channels; perhaps we shall then learn exactly how liberal is the immigration policy of the hon. Gentleman's party.
Several Hon. Members rose—
Mr. Speaker: Order. I shall call the four hon. Members who have been rising, provided that they make their questions brief.
Mr. Jonathan Aitken: Bearing in mind the fact that President Reagan yesterday made some important foreign policy statements as a prelude to the Tokyo summit, will my right hon. Friend try to find time for a foreign affairs debate before the summit, with special emphasis on the need to strengthen the Atlantic Alliance?
Mr. Biffen: I am grateful to my hon. Friend for that point. I am conscious that we have not had a wide-ranging foreign affairs debate outside the confines of the middle east, and I shall bear in mind through the usual channels the timing of such a debate.
Mr. Michael Brown: Further to my right hon. Friend's answers to the hon. Members for Liverpool, Mossley Hill (Mr. Alton) and for Stockton, North (Mr. Cook) on NIREX, will he be a little more specific? Is he saying that the special development order relating to NIREX could be put before the House of Commons but not debated and that during the period before a debate on the special development order there might be a debate on the Select Committee's report? Is that the right interpretation of his answer to the hon. Member for Mossley Hill?
Mr. Biffen: I cannot add to what I said in response to the hon. Member for Liverpool, Mossley Hill (Mr. Alton), but I shall bear in mind my hon. Friend's comments.
Mr. Harry Greenway: May we have an early debate on law and order and freedom of speech in Britain to examine the latest position of the Labour party's leadership, that Britain now has good law and order under the Government, and so that we can question its suggestion that we need to ask people to spend £25 billion on the Labour party's proposed programme? At the same time, could we look at the—
Mr. Speaker: Order. One question.
Mr. Greenway: —ILEA's efforts to force headmasters of London schools to have some papers but not others?
Mr. Biffen: I appreciate that in many parts of the House there is an interest in a fairly early debate on law

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and order. I cannot be that forthcoming, in view of the considerable pressure of Government business at this stage in the Session, but I take note of what my hon. Friend says.
Mr. John Browne: Will my right hon. Friend accept that the battle against terrorism raises matters of fundamental ethical importance which should be debated, such as the use of special forces in counter-terror operations? Will he also accept that it is time that the Government grasped the nettle on the subject of the death penalty rather than leaving it to a free vote?
Mr. Biffen: I imagine that my hon. Friend would wish those considerations to be dealt with in the ambit of a law and order debate if one could be arranged.

Auxiliary Oiler Replenishment Vessels
3.59 pm
The Secretary of State for Defence (Mr. George Younger): With permission, Mr. Speaker, I should like to make a statement.
The Ministry of Defence has now reached conclusions on the competition for the first two Auxiliary Oiler Replenishment vessels of the Fort class.
This is a new concept for a "one-stop" replenishment vessel capable of supporting front-line warships and defending itself. Under its policy of transferring more responsibility to industry the MOD invited firms to put in their own designs to meet the Navy's requirement and to procure the whole ship, including self-defence weapons and associated electronics.
Although a wide range of shipbuilders and other defence firms were invited to tender, designs were submitted by only two consortia, Harland and Wolff (in association with Yarrow shipbuilders and yard) and Swan Hunter (in association with British Aerospace-Marconi).
The tender submitted by Harland and Wolff was technically preferred by both the Ministry of Defence and external consultants, as well as offering earlier delivery and a keener price.
The Government have accordingly decided to award the contract for the design and build of the first ship of the class to Harland and Wolff.
The ship will be named the Royal Fleet Auxiliary Fort Victoria. Once the detailed design has been completed next year construction will begin at Belfast and the ship will enter service at about the end of the decade.
Throughout the tendering process the Government have insisted that the competition should be scrupulously fair, particularly as it involved a private sector and a public sector company. The Government appointed independent consultants, who have examined the Harland and Wolff consortium's bid and have advised that it is unsubsidised and comprehensively costed. The Secretary of State for Northern Ireland has today announced an additional financial discipline on Harland and Wolff plc in respect of AOR aimed at ensuring that any cost overrun will have a similar effect on Harland and Wolff as it would have on a private sector company.
To ensure commonality in naval service, future ships of the class will be built to the Harland and Wolff design, but the Ministry of Defence will allow other shipyards to compete to build follow-on ships.
The Government have decided that Swan Hunter should be given a preferential opportunity to bid for the second ship of the class. Later in the summer, the MOD will be offering Swan Hunter Shipbuilders the opportunity to confirm that it is ready to accept a contract for the second AOR, with construction to begin as soon as possible after negotiations are completed, probably in 1988. This will be on the basis that it will be to the same design as the first, and that the terms and conditions, cost and programme will be no less favourable to the MOD than those already available from the lead shipyard for a follow-on ship.
Mr. Denzil Davies: The right hon. Gentleman's statement will have extremely damaging consequences for Swan Hunter and for Tyneside. I am sure that he is aware of that. The decision will almost certainly cause the loss of 2,000 jobs, including the whole of the

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design team of the Swan Hunter company. Some people might say that this decision will put the company's future in jeopardy. Others might say that the decision is a breach, certainly of the understanding, if not the undertaking, that was given at the time when the Government privatised Swan Hunter. Frankly, the possibility of building the second vessel to the design of Harland and Wolff is no solution to the problem.
Is the Secretary of State satisfied that Harland and Wolff will be able to meet its full contractual obligations, especially on cost and delivery? What on earth is meant by the statement that there will be
"an additional financial discipline on Harland and Wolff"
to ensure that any cost overrun
"will have a similar effect on Harland and Wolff"—
a company owned by the Government—
"as it would have on a private sector company."?
What on earth does that mean? At the end of the day, are the Government prepared to allow Harland and Wolff to go into liquidation?
The second vessel is no solution. What is meant by the statement:
"Swan Hunter should be given a preferential opportunity to bid for the second ship"?
Is that a preference over other bidders? Is it a preference over Harland and Wolff? How on earth can Swan Hunter build a ship to the design of Harland and Wolff, with all the repercussions and practical problems, and yet be given a preferential opportunity in that situation?
Can the Secretary of State at least guarantee—the statement is ominously silent on this—that Swan Hunter will get the order for the second type 23 frigate? That is the least that the Government can do after the shabby way in which they have treated the company which they privatised.
Mr. Younger: That is a most surprising response, and certainly not one that I expected. I wonder whether the right hon. Gentleman heard the statement that I made a moment ago.
I made it clear that the contract was won on price, delivery and the quality of the product offered by Harland and Wolff. Nevertheless, I have intervened to state that preference will be given to Swan Hunter shipbuilders for the building of the second of these ships provided that it can meet the price. The right hon. Gentleman asked what this preference means. It means just that. The second ship will be offered to Swan Hunter provided that it can build it at the price. It is unbelievable that the right hon. Gentleman should consider that that is bad news for Tyneside. It is extremely good news for the area. This is not a breach of any understanding. It is a positive step to help Swan Hunter at the same time as helping the defence budget.
The right hon. Gentleman asked whether Harland and Wolff would meet the conditions. We expect it to do precisely that, and the contract will make it clear it must do so. My right hon. Friend the Secretary of State for Northern Ireland is today publishing the arrangements that he is making for the close monitoring of production at Harland and Wolff to ensure that that is so.
It is well known that the type 23 frigate, 02, is being evaluated by the Ministry of Defence. A bid has been put
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in by Swan Hunter, and although the final decision has not been taken, it is clear that Swan Hunter is in the running for it.
Sir Antony Buck: Is my right hon. Friend aware that many of us on the Conservative Benches and, I suspect, many Opposition Members, admire the decision that he has made? It is a bold and difficult decision, made in a "cannot win" situation. Will my right hon. Friend tell the House that because of his decision the armed forces will be equipped with the best ships for the job, and that, hopefully, they will be delivered on time and relatively within cost?
Mr. Younger: I am grateful to my hon. and learned Friend. He is right in saying that any firm which was given the opportunity to build a large new vessel like this would find that its work force was extremely pleased. We will get two AORs of a very high standard and at a slightly earlier date than was originally hoped and that must be good news for the defence budget.
Mr. J. Enoch Powell: Will the right hon. Gentleman accept that the decision which he has just announced is a recognition of the competitive efficiency of the Belfast firm and the value of the firm's work force? Will he emphasise the fact that employment in many other parts of the United Kingdom will flow from placing this contract with Harland and Wolff?
Mr. Younger: I agree with the right hon. Gentleman on all the points that he has made. It was clear that in competition for the design of this vessel Harland and Wolff put in a very satisfactory design, and that is why it won the competition.
There is nothing unusual for one firm to be the lead yard for a particular type of vessel and for other firms to make the follow-on ships. In this case Harland and Wolff is the lead firm, and Swan Hunter, if it is successful in getting the second vessel—as we naturally hope it will be—will build the follow-on ship. There is nothing new about that, and I am surprised that the right hon. Member for Llanelli (Mr. Davies) did not know that.
Mr. Neville Trotter: Does my right hon. Friend understand that there will continue to be concern on Tyneside until Swan Hunter is awarded the second contract?
Will my right hon. Friend confirm that the competition was between two exceedingly good designs, and the fact that on this occasion the Navy has preferred the Harland and Wolff design is no reflection on the design capabilities and skill of the team of the privatised Swan Hunter yard?
Mr. Younger: Yes, I entirely accept what my right hon. Friend says. I also accept that there will be concern on Tyneside until Swan Hunter has assured for itself the order for the second AOR. Negotiations for the second AOR will be put in train very quickly so that a conclusion can be reached. Both the designs were good, but, as the customer, I must make it clear that the Harland and Wolff design was, for various reasons, undoubtedly better. It certainly provided an earlier delivery date and a keener price.
Mr. A. J. Beith: The decision is a catastrophe for Tyneside, where unemployment is higher than in Northern Ireland. Is the Secretary of State aware that it is difficult to see how the position of a nationalised yard can be compared with that of a private

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yard when, in the case of a private yard, the shareholders, including the executives of the yard, stand to lose everything and to pay the costs if they overrun? Its position is no way comparable to that of a nationalised yard.
Mr. Younger: I am surprised to find such a reasonable person as the hon. Gentleman using inappropriate language. If every shipyard that is given an order for £100 million worth of shipbuilding regards it as a catastrophe, there are plenty of other people who are looking for a catastrophe.
Mr. Piers Merchant: I thank my right hon. Friend for his guarantees over future preferences, but is he aware of exactly how disappointing his decision will be to those of us on Tyneside who supported the Swan Hunter bid? Is he also aware that one cannot count among that number those militant shop stewards who, during the last three weeks, irresponsibly led industrial action during the campaign to attract this order, and who have been responsible for leading a series of industrial disputes during the last few years, which has hardly helped Swan Hunter's reputation?
Mr. Younger: I very much appreciate my hon. Friend's question. I understand how disappointing it must be for everyone in Swan Hunter that the yard did not get the first of these two ships. However, I have explained, in what I hope is a reasonable way, why this was so. My hon. Friend made a telling point about the activities of some people who caused disruption at the yard. I hope the House will give the Government and my Department credit for the fact that we have bent over backwards to pay no attention to that by making it clear that we are prepared to give Swan Hunter the chance to build the second AOR.
Mr. Don Dixon: The right hon. Gentleman's statement means that this is a black day for the shipbuilding communities in the Tyne area. If he wanted to be fair, why did he not award one contract to Harland and Wolff and one to Swan Hunter? In the short term it means many redundancies in the Tyne area. In the long term it will put in jeopardy shipbuilding in the Tyne area because of the impact that this decision will have on the design team at Swan Hunter. Even at this late stage will the right hon. Gentleman agree to place one contract with Harland and Wolff and the other with Swan Hunter? Will he also agree to hurry up the type 23 order, negotiations for which have been continuing for many months? If an order is not received in the very near future, hundreds, if not thousands, of additional unemployed men will be walking the streets in the Tyne area.
Mr. Younger: I am not sure whether the hon. Gentleman was in the Chamber when I made my statement. He asked whether it would have been better to award the first contract to Harland and Wolff and the second to Swan Hunter. Subject to Swan Hunter being able to meet the conditions that I have outlined, that is precisely what I have done, and I am wondering why the hon. Gentleman is not pleased about it.
Mr. Ian Gow: Is it not clear from the questions of the right hon. Member for Llanelli (Mr. Davies) and the hon. Member for Berwick-upon-Tweed (Mr. Beith) that neither of the two Opposition parties believes in fair competition? Is it not also clear from my right hon. Friend's statement that, quite properly, the
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Government have taken the greatest possible care in awarding this contract on the basis of design, price and delivery date?
Mr. Younger: I am grateful to my hon. Friend. It leads me to put what I said the other way round. If I had chosen to deny this contract to Harland and Wolff, with its better design and delivery date, and with every bit as good a price, I cannot imagine what the Opposition would have said about the competition principle.
Mr. Nicholas Brown: I listened carefully to the Secretary of State's statement. It defies reason. Is he aware that he has almost certainly announced the closure of Swan Hunter and that his statement about the second AOR order will be seen to be as cynical as the promise that was made two years ago about the type 23 frigate, which has still not turned up? Swan Hunter must have fabrication work now. The Secretary of State has made no announcement about fabrication work for the yard. His statement will be seen as a betrayal of privatisation on Tyneside and as appeasement of terrorism in Ulster.
Mr. Younger: Again I am extremely surprised by the hon. Gentleman's question. I know that he is concerned about the future of the Swan Hunter shipyard. As this is an offer to the yard to submit a detailed consideration for a further vessel involving many man hours of work, I am surprised that the hon. Gentleman does not welcome it. I hope that his constituents will manage to persuade him that he is not acting in their interests.
Mr. Michael Fallon: Does my right hon. Friend agree that the lesson for industry in the north-east is that work for which it tenders must be competitively priced? If Harland and Wolff's bid is as genuinely competitive as my right hon. Friend's advisers think it is, why are there no plans to privatise the yard?
Mr. Younger: I am grateful to my hon. Friend. The privatisation of Harland and Wolff is a matter for my right hon. Friend the Secretary of State for Northern Ireland. No doubt my hon. Friend will take the matter up with my right hon. Friend. I agree about the necessity for competitive pricing. In this case, the company which submitted the most competitive bid in all the circumstances won the competition. I should have thought that any other conclusion would not be acceptable to the House.
Mr. Dick Douglas: Does the Secretary of State accept that his statement shows how parlous is the state of the shipbuilding industry as a whole? That is why hon. Members are concerned about employment, and why they are competing across the Floor of the House for the available orders. I, as a Scottish Member of Parliament, do not exclude myself from that concern. The design order for the Yarrow yard is welcome to the Clyde, but will the Secretary of State say a little about the 03 and 04 of the type 23 frigate that have been promised? I understand that completion of tendering may be in June 1986. Is the Secretary of State able to give us an assurance about this, because it is important to the yards on the Clyde?
Mr. Younger: I appreciate the hon. Gentleman's question. He is right when he says that the state of shipbuilding is very difficult because of the very few orders that are available. However, it surprises me that, if its representatives are anything to go by, a yard that has

439
been offered the chance of a major order does not think that that is good news. Many people in Scotland will find that very hard to understand. No decision has yet been taken about a further order for frigates, but I am well aware of the importance of that order.
Mr. Barry Henderson: Is my right hon. Friend aware that many people will want to congratulate him on a well-judged statement? Is he able to state the significance in scope and value to the Clyde of the Harland and Wolff order?
Mr. Younger: I am grateful to my hon. Friend. There will be a considerable amount of work for the Clyde. My hon. Friend will have to ask Harland and Wolff for the breakdown of the work on the first of these two ships between other parts of the United Kingdom and Northern Ireland.
Dr. Norman A. Godman: The right hon. Gentleman emphasised the upper Clyde in his last answer. Is he able to say anything about the lower Clyde vis-á-vis Ministry of Defence orders? May I remind him that Scott Lithgow, Kincaids and Ferguson-Ailsa are in a parlous condition over orders? Does he have any vestige of hope to offer to shipyard workers in my constituency?
Mr. Younger: The hon. Gentleman knows that I am very well aware of the difficulties in his constituency and of his very great concern about those yards. My right hon. Friend the Secretary of State for Trade and Industry, who has the main responsibility for the shipbuilding industry, is actively studying that problem. The hon. Gentleman will appreciate that, no doubt for good reasons, Scott Lithgow was invited to tender for this order but decided not to do so. Therefore, I cannot be of help on this occasion.
Mr. Richard Page: Leaving on one side the question of the hon. Member for Newcastle upon Tyne, East (Mr. Brown) about whether Northern Ireland and Harland and Wolff deserve this order in view of the Loyalist activities in the last few weeks, will my right hon. Friend please publish the consultants' report, so that justice and fair play can be seen to have been done?
Mr. Younger: I appreciate my hon. Friend's concern that justice should be seen to have been done. As I said in my statement, my right hon. Friend the Secretary of State for Northern Ireland is today publishing his plans for a close monitoring of this contract. My hon. Friend's request that the report should be published will have to be addressed to my right hon. Friend the Secretary of State for Northern Ireland.
Mr. Stephen Ross: There was bitter disappointment when Vosper Thornycroft did not get any orders on the previous occasion. Nevertheless, I congratulate John Parker and Harland and Wolff on winning this contract. Obviously it has been won on merit. This is in contradistinction to the decision of the Secretary of State's predecessor, who awarded the Tucano to Short Brothers, and not the PC9. May we be assured that the work force will support the Government's confidence in it. We look to that to happen. Nevertheless, I hope that Swan Hunter will accept the terms laid down by the
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Secretary of State today, which seem, on the evidence of previous contracts, to be in accord with recent Ministry of Defence practice.
Mr. Younger: I am grateful to the hon. Gentleman for his welcome for this decision, although I appreciate his disappointment about Vosper Thornycroft. However, as he will know, that firm did not tender for this order. The hon. Gentleman should speak to his hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith), because the Liberal party seems to have two totally different views on this contract.
Sir John Biggs-Davison: In welcoming the fullest information that has now been promised, may I ask whether it is not clear that this decision has been based on price and design and the needs of the Royal Navy? Has the attitude of the Labour party not revealed a bigoted hostility to Northern Ireland, which will be noted by the workers of Belfast?
Mr. Younger: I am grateful to my hon. Friend for what he has said, and I realise that hon. Members will have many other factors in mind in considering the statement. He is right in pointing out that unless those who win a competition in a perfectly fair and normal way are given the contract, the whole policy of competition will fall down. In this case there was a clear winner, but, from the point of view of the needs of the Royal Navy, we have thought it best to put the second vessel to the other yard so that the best results can be obtained for the Royal Navy from these contracts.
Mr. Frank Field: Does the Secretary of State accept that if one yard with a back-up subsidy of £37 million competes with other yards with no such back-up subsidy, that is not only unfair, but, if continued, will result in the closure of English and Scottish yards? If that happens, will that not defeat the whole of the Government's thrust for greater competition and their procurement policy? In addition, before the end of the day, will the Minister ask a favour from the Irish? As many companies in Great Britain have to watch foreign companies grow fat on hidden subsidies, will he ask Harland and Wolff how it has managed to hoodwink his officials, because surely the lesson could be more widely spread?
Mr. Younger: I appreciate the hon. Gentleman's concern, but I should make it clear that my right hon. Friend the Secretary of State for Northern Ireland has taken the greatest care about this matter. He will not merely watch progress. He is today publishing the ways in which he will ensure that the progress of this contract with Harland and Wolff is absolutely as per the contract. When it comes to the difficulties of comparing nationalised industries with others, the hon. Gentleman will appreciate that that is one of the consequences of having nationalised industries, which cause great difficulty in many ways which we would be better to avoid.
Mr. Jonathan Sayeed: My right hon. Friend would rightly have been properly condemned had he not chosen the design that is technically better and the bid that promised earlier delivery at a lower price. Will he ensure that if Harland and Wolff goes over budget, it will mean that the income of the management of Harland and Wolff is commensurately reduced, as it would be if the Swan Hunter bid went over?
Mr. Younger: My hon. Friend is right about that. This is a matter that the House and the Government will want to watch carefully. If Harland and Wolff were to overrun in the cost, that would reduce its ability to compete for further orders elsewhere. That fact will be a powerful incentive to the company, in addition to the measures that my right hon. Friend the Secretary of State for Northern Ireland will be announcing today. My hon. Friend is perfectly correct in saying that to have given the contract to a company which did not win the competition would have been grossly unfair on all those who took part in the competition.
Mr. Stuart Randall: While welcoming any contract announcement of this kind, may I ask the Secretary of State whether he is aware of the hundreds of subcontractors involved in these contracts who will be very disappointed that Swan Hunter did not get the design part for the second vessel? In my own constituency of Hull, one of the subcontractors is Humber Electrical Ltd., which makes marine switch gear and which will be particularly disappointed to learn that it is unlikely to get work on the first ship. This is particularly disappointing in Hull, where there is an enormous increase in unemployment and a lot of deprivation. When it comes to the allocation of further subcontracts by Harland and Wolff, will the Secretary of State consider Humber Electrical Ltd.?
Mr. Younger: I appreciate the hon. Gentleman's point, but a lot of work is coming outwith Northern Ireland, even with the first of these ships, because subcontractors has taken place already. I understand that about a third of the work is sub-contracted elsewhere in Britain. I am sure that the hon. Gentleman's constituents will be able to take part in the second AOR. If they want to put in bids now to the main contractor for the first AOR, they will be considered, if there is still space. However,
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the point is that if subcontractors and contractors enter a competition, they must expect those who win the competition to get the work.
Mr. James Couchman: Is my right hon. Friend aware that those of us who had applauded the management buy-out of Swan Hunter had very much hoped that it would be able, in fair competition to win the order for the first AOR, which carries the design facility with it? Can he be more specific about how soon Swan Hunter can expect the decision on the second AOR and, also on 02, 03 and 04 of the type 23 frigate?
Mr. Younger: It was disappointing that Swan Hunter did not win the competition. The second of these ships was one of two for which both competitors tendered. Provided that Swan Hunter can satisfy the Ministry of Defence that it will be able to produce the second ship at the price offered by the winner of the competition, it will be given the preferential chance of getting the second order. I hope that this will be seen to be fair to Swan Hunter, but it will require it to take some hard decisions in order to get its bid down to the right price.
Sir Kenneth Lewis: Is my right hon. Friend aware that many people will say that if this Government and the Ministry of Defence had been as unco-operative as some of the leaders in Northern Ireland, Harland and Wolff would not have got the order? I am glad that it did get the order, and I hope that the leaders in Northern Ireland appreciate that fact.
Mr. Younger: My hon. Friend makes an extremely good point. Perhaps I can assure him, and everyone in Northern Ireland, that in considering the bid I had in mind only the excellence of the design and the proposed workmanship, price and delivery offered by Harland and Wolff. No political consideration of the Northern Ireland situation came into the matter.

Land Rover-Leyland
Mr. Speaker: I call the Secretary of State for Trade and Industry.
Mr. Dave Nellist: On a point of order, Mr. Speaker.
Mr. Speaker: I shall take the point of order later.
Mr. Nellist: It is on this matter.
Mr. Speaker: The hon. Gentleman has not been rising to ask a question, but I shall take his point of order.
Mr. Nellist: On a point of order, Mr. Speaker. Is it in order for the Secretary of State for Trade and Industry to seek this afternoon to make a statement on British Leyland which, I understand, is to make no mention of the fact that on Monday this week part of the British Leyland truck and bus operations, Self-Changing Gears in Coventry, was sold to Cummins Engine in America, and four days after that sale there is still no report to the House of Commons on that part of a British nationalised industry that has been privatised.
Mr. Speaker: Order. I am not certain that we can know what the Secretary of State will say.
4.27 pm
The Secretary of State for Trade and Industry and President of the Board of Trade (Mr. Paul Channon): With your permission, Mr. Speaker, I should like to make a statement.
When I made my statement to the House on 25 March following the ending of the talks between BL and GM on the privatisation of the main Land Rover-Leyland businesses, I made it clear that BL would continue to study alterntive ways forward for all the businesses concerned. In the particular case of Land Rover and Freight Rover, BL asked for proposals to be made by 15 April. As the House is aware, four proposals were received. These were from Aveling Barford in respect of Land Rover and Range Rover; J. C. Bamford in respect of Land Rover, Range Rover and possibly Freight Rover; Lonrho in respect of Land Rover and Range Rover; Schroders, acting for a management and institutional consortium, for Land Rover, Range Rover and Freight Rover.
The BL board has carefully considered these proposals and has weighed them against the option of retaining Land Rover and Freight Rover within BL for a possible flotation or trade sale at a later date. The board has concluded, on both commercial and industrial grounds, that retention of the businesses within BL pending a later sale presents a more attractive option for BL than any of the bids which have been received. The board has therefore recommended to the Government that none of the bids be pursued and that the companies be retained within BL while preparations for future privatisation are made. The Government have accepted the board's recommendation.
Mr. John Smith: Does the Secretary of State realise that this latest Government climbdown represents a humiliating and total reversal of their misguided policy to sell off the Austin Rover Group, Leyland Truck and Land Rover? Does he appreciate that, were it not for the exposure of the Government's furtive negotiations with General Motors and Ford and the forceful expressions of parliamentary—[Interruption.]
Mr. Speaker: Order.
Mr. Smith: Conservative Members may not like this, but they have to listen to it.
Does the right hon. Gentleman appreciate that, were it not for the forceful expressions of parliamentary and public opinion which forced the Government, especially the Chancellor of the Duchy of Lancaster, who is the leader of the Conservative party organisation, to get cold feet, the crucial remaining parts of the British motor vehicle industry would this day be under foreign ownership and control?
Should not the Secretary of State now apologise to the British Leyland Group for the damaging uncertainty, calculated in thousands of orders and tens of millions of pounds, which the Government have caused by their foolish actions? Is it not clear that the question of other bidders being considered for various parts of British Leyland was a blind in that, when General Motors and Ford ceased to be involved, the whole project collapsed?
Should not the Government end the remaining uncertainty which will be caused by references to a trade sale and a possible flotation, which puts the matter not so much on ice as on melting ice, and announce that between now and the next general election there will be no question of disposing of these British Leyland businesses? I ask the Secretary of State specifically whether the Government have any intention of resuming negotiations with General Motors and Ford before the next election. Will the right hon. Gentleman give a specific answer?
Does not this whole sorry episode, which goes back as far as August 1984 and which has today come to a partial—I hope a final—conclusion, demonstrate the total unfitness and incompetence of a series of Secretaries of State and of the Government as a whole to take on the serious responsibilities for British industry which were put upon them and which they have pitifully failed to discharge?
Mr. Channon: As usual, the right hon. and learned Gentleman grossly exaggerates the case he puts to the House. I strongly refute his allegations. I explained to the House on 25 March the exact procedures that the Government would follow after my statement and what would happen. We received four bids which British Leyland carefully considered. They were serious bids and were seriously considered. The Government seriously considered the recommendations by the BL board. I and the BL board believe that, commercially and industrially, the best future for this company will result from a flotation or trade sale in a year or two years' time when the company's financial situation is better than it is. That must be commercially, industrially and financially right, and I hope that the whole House welcomes it. I made GM's position clear in my statement of 25 March. Nothing has changed.
Mr. Kenneth Warren: I am sure that my right hon. Friend is very much aware of the substantial investment requirements of the BL group. Will he therefore give an assurance that those investment plans will be supported by the Government without reservation until we can step forward with privatisation?
Mr. Channon: The investment plans of the BL board will be considered in the context of the corporate plan in the normal way. I take note of my hon. Friend's views.
Mr. Terry Davis: Surely the right hon. Gentleman is aware of the damage caused

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to BL, especially Freight Rover and Land Rover, by the uncertainty in the past three months—uncertainty which will continue indefinitely because of the right hon. Gentleman's statement that these parts of BL will be sold at some time in the future? What will the right hon. Gentleman do to compensate BL for that damage? Why will not the Government simply drop their pig-headed insistence on selling off the most profitable parts of BL and let the people who work at Freight Rover and Land Rover get on with the job of making and selling vehicles at a profit without constantly looking over their shoulders at what the Government are doing behind their backs?
Mr. Channon: The hon. Gentleman is trying to say that uncertainty remains. The proposal to privatise these parts of British Leyland has been known for years. That is not new. There is no new uncertainty. There will now be a period of stability. I am certain that I am acting in the interests of the companies as a whole.
Mr. John Mark Taylor: Is my right hon. Friend aware of the hopes and fears aroused in my constituency since the end of January? Whereas the prospect of Land Rover's privatisation will be welcome, the failure to take up the management buy-out will be seen as a missed opportunity, uniquely consistent as it was with the Conservative party's manifesto and backed up by trade union investment.
Mr. Channon: Of course I understand my hon. Friend's views. Naturally, the management proposals were considered extremely carefully, but the BL board concluded that the management proposals, and the other bids, did not represent the best course in the company's commercial, industrial or financial interests. In view of that recommendation, which was strongly supported by the board, the Government felt it right to pursue this course.
Mr. Paddy Ashdown: Is not the scandal of this sorry affair the fact that foreign companies were able to see the advantage of investing in Britain which our Government were not able to see because of their short-term perspective? Will the right hon. Gentleman undertake to look at the possibility of European collaboration in this matter, as recommended by his colleague, the right hon. Member for Old Bexley and Sidcup (Mr. Heath) on 6 April in his article in The Observer?
Mr. Channon: I am not sure whether the hon. Gentleman is complaining about foreign investment or welcoming it—I expect that it depends on the company about which we are talking. I am trying—I hope that the Opposition will not try to change the position—to remove the uncertainty. Therefore, I have nothing to add to my original statement—[Interruption.]
Mr. Speaker: Order. This is a serious matter. It is not a laughing matter.
Mr. Steve Norris: Will my right hon. Friend comment on the assertion by the right hon. and learned Member for Monklands, East (Mr. Smith) that the GM-BL talks were somehow furtive? Does my right hon. Friend agree that that demonstrates to those of us whose industry interest is long-standing rather than just developed and manufactured from nothing, that people knew perfectly well that these talks were taking place,
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including all the GM employees, because the company circulated information to them telling them exactly what was going on?
Mr. Channon: My hon. Friend is entirely right. The hypocrisy, double-dealing and hopelessness of the general Opposition stance have been evident. Their behaviour throughout the talks has been absolutely disgraceful.
Mr. George Park: Is it not clear from the previous Government statement that a nationalised company could be more efficient than a privatised one? Why cannot the same logic be applied to British Leyland? The logic of the right hon. Gentleman's statement is that the faster efficiency increases, the faster the companies will be privatised—thus continuing the damaging uncertainty.
Mr. Channon: The hon. Member talks as if privatisation in the motor industry was a bad thing. When he looks at the example of Jaguar, I should have thought that would have given him cause for reflection, in view of the excellent results of Jaguar and the beneficial results of privatisation.
Mr. Anthony Beaumont-Dark: Does my right hon. Friend accept that many of us feel quite bewildered today, although obviously we should not, because on this issue more than once victory has been lost that could have been won? Is it not a farce and charade in that, if the House had let General Motors buy, the Government would have been willing to sell? The management and workers put forward a perfectly viable and sensible proposition which in my view would have achieved what we keep advocating—a wider share-owning democracy. Why is it that the workers and management are not fit to buy it? Are not the Government hoist upon their own petard in that, if they are not willing to sell BL, they must back it and they must back it to the full? Are the Government willing to put money into the new design and a new future, because if they do not put in a new design and a new future we shall be stuck with failure? Do we want success and are we going to back it?
Mr. Channon: I have no doubt that the future of Land Rover in the way that I have outlined will be a successful one. The forecasts for it, I think, are good. I think that the prospects for it in the next couple of years will be very good. I have already explained why I think that privatisation is a good thing in the long term. The Government had to decide what was the best commercial, industrial and financial prospects for the company. If I had thought that the management buy-out was, I would certainly have accepted it.
Mr. D. N. Campbell-Savours: Is the Secretary of State aware that the only part of British Leyland group that now has an immediate threat over its head is Leyland Bus? What is he going to do about it? Is he aware that morale throughout all the Leyland Bus plants has been totally undermined in the last months? Will he reverse his proposals to privatise?
Mr. Channon: No, but I share the hon. Member's concern about the future of Leyland Bus. I shall have to consider this matter with the board in the fairly near future because it is a serious situation and there are difficult choices to be made in the bus industry. I know very well the hon. Member's concern about this, and I shall certainly bear it in mind.
Mr. Roger King: Will my right hon. Friend accept that some of us do not necessarily have a great deal of confidence in the present BL board? We feel that, had it looked closely at the management buyout, it would have been abundantly obvious that it has the resources and the backing of the trade unions and the merchant banks that would ensure that Land Rover and Freight Rover could continue successfully. Can I have an assurance from him that, in the event of a future sale of Land Rover and Freight Rover, it will be privatised and not sold to another company or organisation?
Mr. Channon: I understand my hon. Friend's view about the management buy-out. Of course, if that had proved to be the one that was the most likely to lead to the industrial and commercial success of the company, that would have been a respectable solution, and one that the Government would have been very happy to take. It would have been a very good solution for the company if it had been the best commercial one, but it was the view of the BL board that this was not the best solution. I think that it was quite right for the Government to take the course that they have. I have said that we hope to prepare the company for privatisation in future. I think that it would be wrong for me at this stage to close any of the options, but I note my hon. Friend's strong views that the better way would be to have a flotation.
Mr. Gregor MacKenzie: Are we to understand from the Secretary of State's answer to his hon. Friend the Member for Hastings and Rye (Mr. Warren), that what he now proposes to do is to invest further sums of the taxpayers' money in the organisation and that, once improvements have been effected by this investment, he proposes to sell it off to the private sector at a very considerable cost to the ratepayer? That is what it sounded like to us.
Mr. Channon: No, I am glad to tell the right hon. Gentleman that that is not the case. There are no proposals from the BL board for further injection of equity into the Land Rover business.
Mr. Michael Grylls: Is my right hon. Friend aware that many people who very enthusiastically support the return of as much as possible of British Leyland to the private sector as quickly as possible will be disappointed by his decision today? In many ways it is an incomprehensible decision when there were a number of good offers on the table. Is it because it has come from a lame duck board anyway? Will not this proposal leave uncertainty over the head of British Leyland, with nobody knowing who is going to own it for two or three years, however long it takes? That will be very bad for its commercial future.
Mr. Channon: With respect, I cannot agree with my hon. Friend about that. What I am sure he agrees with me about is the need to provide the best future for the company. The BL board has made a very firm recommendation that retention of the businesses for the time being within BL represents the better commercial solution for that company in the long run and for the employment prospects for those in it. In those circumstances, I think that it was right for me to recommend to the House that that should be accepted.
Mr. Doug Hoyle: Having created the instability the Minister now talks of stability for the
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company, yet he is still leaving the company in limbo. Given that the management has hanging over it the real threat that in two years' time the company could be privatised, does he not agree that what is needed is the withdrawal of that threat, to allow the company to get on with it and to make the investment available to it so that it can begin a strong marketing policy and sales can begin to boom again?
Mr. Channon: I cannot agree with the hon. Gentleman. It has been known for a long time that these companies were to be privatised. There is nothing new in that. There is no new uncertainty about that. I believe that my decision today will remove the uncertainty. I think that it will lead to a period of stability.
Mr. Robert Atkins: Is my right hon. Friend aware that my overriding interest and that of my constituents who work at Leyland Truck and Leyland Bus is that Leyland Truck is now first in the league of heavy truck manufacturers in the country and doing well, and Leyland Bus is considering offers for the purchase of that company? Will he confirm that the offers for Leyland Bus will still be considered on their merits, and take advice from those who understand the industry within and without as to at least one of those contenders? Will he also confirm that in the long term priority will be given to what I understand is a Conservative commitment to share ownership, directed particularly at the small shareholder and those working in the company?
Mr. Channon: I agree with a great deal of what my hon. Friend says. I confirm to him the position as he outlines it, of Leyland Bus. I am also glad to say, despite the great difficulties in the truck market, that Leyland Truck sales in the first quarter of this year are up by some 18 per cent. I think that is encouraging.
Mr. Andrew Faulds: Have the Prime Minister and her Cabinet learnt any lesson from their somewhat unfortunate handling of these matters?
Mr. Channon: I think that what we have done is to arrive at a right conclusion, which I hope the House will support.
Mr. Richard Page: While I welcome my right hon. Friend's statement, in view of the huge overcapacity in trucks, vehicles and cars throughout the world, will he now produce an overall plan for the future of British Leyland, as piecemeal disposal will lead to more problems than it would solve?
Mr. Channon: As my hon. Friend knows, the new chairman of British Leyland will take over next week and, of course, he will want to consider all the options now available for the future of the company.
Mr. David Winnick: Is the Secretary of State aware that people, certainly in the west midlands, will not forget the undercover and deceitful way in which negotiations went on without any public knowledge and, certainly, without any statement having been made to the House? Does not the Secretary of State recognise that what he has announced today is particularly a defeat for the Prime Minister—perhaps that is why she is not present—and those members of the Cabinet who took the decision purely because of party dogma and prejudice?
Mr. Channon: The hon. Gentleman is talking absolute nonsense. My hon. Friend the Member for Oxford, East

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(Mr. Norris) pointed out a little while ago that the idea that this was some undercover or deceitful negotiation is absolute nonsense. It has been known in all the newspapers for months. The idea that some secret things were going on has, I think, been fully exploded. If anything has been deceitful, it is the conduct of some Opposition Members.
Mr. David Madel: Does my right hon. Friend agree that arguing endlessly about ownership of the commercial vehicle industry does not alter the fact that people who work in the industry are concerned about investment and job security? Therefore, will the Government do all they can to make sure that General Motors stays here with a strong, viable presence? Will my right hon. Friend join me in refuting the argument of the right hon. and learned Member for Monklands, East (Mr. Smith) that somehow the negotiations were furtive? Trade unionists in Bedfordshire told the right hon. and learned Gentleman about the negotiations months ago but he does not appear to have listened to what they said.
Mr. Channon: When it suits the Labour party to pretend that things are deceitful, it will do so. The House knows what value to put upon those words. As to the question of the commercial vehicle industry itself, my hon. Friend is right to draw attention to the very serious problems that exist in the industry. I certainly share his views about the importance of GM continuing in Bedfordshire. It is well recognised in Bedfordshire and throughout the country that that has been an extremely valuable investment both in jobs and in opportunities for the country.
Mr. Jack Straw: Is the Secretary of State aware that Ministers' wilful misconduct of the affairs of British Leyland has cost that company and the taxpayer millions of pounds for which, if those Ministers were local councillors, they would be surcharged? Is the Secretary of State not aware also that any suggestion that there can be a period of certainty is wholly undermined as long as he continues with the idea of a possible sale to General Motors? If he is concerned about the future of British Leyland, why does he not rule out completely a sale to General Motors?
Mr. Channon: I have already said to the House that nothing has changed with the position as regards General Motors since my statement of 25 March. Perhaps the hon. Gentleman would be so good as to read what I said on 25 March, which was crystal clear and which the House accepted at the time. As to the question of uncertainty, I have a feeling that it suits some Opposition Members to try to create the uncertainty that they complain about.
Mr. Nicholas Budgen: Does my right hon. Friend agree that it is difficult for the House to evaluate properly what he has said because he has not told us what price the bidders have offered or what funds the bidders have to support the company in future? The interest of the taxpayer and of the employees of BL is that the business should be sold for a good price to purchasers who are able to fund investment in it in future.
Mr. Channon: I agree with the latter half of my hon. Friend's question. As to the first part, I am not in a position to reveal all the commercial details that were given in confidence to the BL board. It would be wrong for me to do so. I assure my hon. Friend that the decision of the
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Government, based on the recommendation of the BL board, was taken only after exhaustive examination of the commercial, financial and industrial implications.
Mr. Robin Corbett: Cannot the Secretary of State understand that this afternoon he has added to the uncertainty? Earlier he spoke of privatisation within a year or two. A little later he talked about privatisation in the near future. Will he not give a guarantee from the Dispatch Box now that there will be no attempt at privatisation until after the next election?
Mr. Channon: I am not prepared to give such a guarantee. I shall ask the new chairman of British Leyland to consider all the options available. [Interruption.] No. Hon. Gentlemen are deliberately trying to create the uncertainty of which they are accusing me. The new chairman of British Leyland will consider the future privatisation of Land Rover by flotation or by trade sale at an appropriate date, but that will be after a period of stability.
Mr. Tim Yeo: Does my right hon. Friend agree that, because of all the millions that the taxpayers have put into British Leyland, it is wholly right that individual taxpayers should in due course have an opportunity to invest directly in a successful part of it? Does he agree further that the precedent of Jaguar demonstrates, contrary to what Opposition Members say, that far from creating uncertainty, the prospect of flotation may act as an additional incentive to both management and workers?
Mr. Channon: I agree entirely with my hon. Friend. It is extraordinary that Opposition Members, faced with the Jaguar precedent, repeat the old-fashioned, out-of-date arguments against privatisation when it is clear that the privatised Jaguar company has been an outstanding success. What I think irks the Opposition is that it has been a success.
Mr. Norman Atkinson: Does the Secretary of State realise that he has added considerably to the uncertainty by refusing to answer the questions put to him by my right hon. and learned Friend the Member for Monklands, East (Mr. Smith)? He asked about the future of the Austin Rover division and about future discussions with American companies about the manufacture of motor cars in this country. Is the Secretary of State aware that in the period to which he has just referred, there have been continuing collaborative agreements with Honda of Japan which is now manufacturing to its specification? Does that not mean that creeping privatisation is taking place? Honda is making a creeping takeover. Unless the Secretary of State intervenes, before very long the Austin Rover division will be privatised by the Japanese and will not remain in British hands.
Mr. Channon: The statement was not about Austin Rover. The position of Austin Rover has not changed over the past few months; therefore, there was no need for me to make a statement to the House. The hon. Gentleman is inaccurate in what he has been saying. It had nothing to do with my statement this afternoon.
Mr. Geoffrey Dickens: Is not my right hon. Friend astonished at the attitude of the Opposition who for years have been trying to create the myth that our Prime Minister was bossy and would not listen? Today we have proof that the Prime

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Minister has listened to what Back Benchers have said. BL stays British, and we take things more slowly, which is sensible. Range Rover and Land Rover remain British. That is what the nation and most hon. Members want.
Mr. Channon: I am extremely grateful to my hon. Friend for his robust support.
Mr. Stuart Randall: Will the Secretary of State confirm that the Government are totally committed to supporting the company's short and medium-term investment programme, which is so crucial to its future?
Mr. Channon: I have already answered that point. The Land Rover section of British Leyland does not need further equity. No application has been made to me by British Leyland and I see no reason why there should be one.
Mr. Tony Marlow: Will my right hon. Friend reassure the hon. Member for Warrington, North (Mr. Hoyle) that privatisation is not a threat but an opportunity? If my right hon. Friend were a betting man, would he expect that opportunity to be put into effect before the next election or after it?
Mr. Channon: I have not been told the date of the next general election, so I think it would be unwise to take up my hon. Friend's offer of a bet. I agree entirely with him on the first part of his question. Privatisation, when it takes place, will be good for the companies, for the employees and for all the people concerned, and should be done at the moment when it makes best industrial and commercial sense. That is what we intend.
Mr. Ian Wrigglesworth: Does the Secretary of State accept that he has a responsibility to the House and to the company to come forward to the House at an early stage to explain what preparation for privatisation means? Will he consult the new chairman of the board of British Leyland as speedily as possible and come forward with clear proposals and clear strategy for the company so that we may avoid a confusion such as has arisen in recent times? As we all know, BL cannot survive in the volume car business without a partnership with another major company from another part of the world or from somewhere else in this country. Will he make clear what will happen and also why he has turned down the application for the purchase of the company by the staff and the work force of Land Rover?
Mr. Channon: On the last part of the question, I have tried to explain why the BL board does not think that the proposal put forward by Schroder on behalf of the management represented the best commercial opportunity for the company. That is why the proposal was not accepted. As to the first part of his question, I do not think that there is any need for me to make an immediate statement. There will be a period of stability, and the matters need careful study.
Mr. Nicholas Soames: In view of the unfortunate behaviour of Her Majesty's Government towards General Motors, and in view of the enormous investments which that company has made for many years in this country, will my right hon. Friend assure the House that no lasting damage has been done to relationships between the Government and General Motors?
Mr. Channon: I am sure that no lasting damage has been done. I entirely agree with my hon. Friend about the welcome that the overwhelming majority of hon. Members give to American investment in Britain and to investment by General Motors. If any hon. Member disagrees with that, perhaps he will say so.
Mr. John Smith: In the course of his answers the Secretary of State said that privatisation might be in a year or two, in the near future or after a period of stability. Can he tell the House how long the period of stability will last before the new instability commences? Can he not state clearly and confidently to the House that there will be a period of stability until the next general election, and that that stability will be achieved by the Government saying that there will be no change in the ownership of British Leyland? That will remove all speculation and uncertainty and allow the businesses to run.
Mr. Channon: As the House knows perfectly well, this statement deals only with Land Rover and not with the whole of British Leyland. The right hon. and learned Gentleman is trying to widen the discussion to take in matters that we are not discussing. I am not prepared to give the undertaking that the right hon. and learned Gentleman seeks. I said in my statement:
"retention of the businesses within BL pending a later sale presents a more attractive option".
That is the option we will pursue and we will pursue it after we have carefully considered the situation with a new chairman. There is no hurry on this because we want to do it at the appropirate time. It is clear from the proposals of the BL board that it believes that in a period of time such a course of action will be more advantageous for the company than it is at present.

Oxford Street Bomb
5.1 pm
The Minister of State, Home Office (Mr. Giles Shaw): I will, with permission, make a statement about the explosion in Oxford street earlier today. At about 4.45 am this morning a small device exploded outside the side entrance of the British Airways office on the corner of Oxford street and Lumley street. The remains of the device are being examined by forensic experts.
The explosion damaged the office of British Airways, which is shared by some other travel companies, and it started a fire. The flats above and opposite the offices were evacuated. They suffered blast damage, but were not damaged by the fire. There has been some damage to glass in the surrounding buildings. One woman from the flats was taken to hospital suffering from shock, but has since been released. There have been no other injuries. Oxford street was closed for a time, but was re-opened to traffic at 10 am.
I understand that the Press Association received calls claiming responsibility from the Scottish National Liberation Army and the Angry Brigade but it is not possible at this stage to attribute responsibility to any individual or to any group.
Although the police issue warnings whenever there is evidence of a specific threat, the public should, as ever, remain on their guard and report to the police anything suspicious which attracts their attention.
Mr. Gerald Kaufman: Is it not ironic that the Home Secretary is not present to make this statement because he is in The Hague attending a meeting about terrorism? May I offer our sympathy to those who have suffered loss as a result of this bomb attack, and especially to the woman who was injured? I congratulate the fire service on its swift and efficient action, especially in the light of the possibility of a second bomb. What additional resources are the Government making available to the police to shoulder extra burdens such as this, especially if there is to be any intensification of terrorist activity?
We in Her Majesty's Opposition condemn this new outrage and say quite plainly that the British people will not be intimidated by terrorist acts, as has been shown by the finn reaction to IRA activity. At the same time, the British people will not accept that they should gratuitously be exposed to terrorist activity. Will the hon. Gentleman now answer the question that the Home Secretary failed to answer when I put it to him on Tuesday: what advice did the Home Secretary give to the Prime Minister, in advance of the American bombing of Libya, about the internal security implications for Britain of those raids?
Mr. Shaw: I am grateful to the right hon. Gentleman for offering his sympathy to the lady who was injured in this attack. Happily, she has now been released from hospital. Quite rightly, I take note of his strong views that we shall not be intimidated by terrorism. He asked about additional resources for the police. He will know that the Metropolitan police and the various specialist departments within the police have our full support about resources. He will also know that resource applications have recently been made by the Metropolitan police. Those applications are being considered.
The right hon. Gentleman paid special attention to my right hon. Friend's visit to The Hague. I trust the right hon.
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Gentleman will say how good it is that my right hon. Friend should currently be discussing with our European partners the improvement of anti-terrorist operations. I hope that the outcome of that meeting will be a strengthening of the attitude towards terrorism in general and Libyan terrorism in particular.
Mr. Ian Gow: Is my hon. Friend aware that we on this side are well content that he should make this statement? We are equally content that our right hon. Friend should be at this important meeting in The Hague. In response to what the Shadow Home Secretary said, may I ask my hon. Friend whether it is the case that there is nothing whatever to link the explosion in the early hours of this morning with any Arab organisation of any kind?
Mr. Shaw: My hon. Friend is quite right. Contrary to reports appearing in the press, neither we nor the police have any information that would firmly link this incident with a Libyan or any other group.
Mr. Alex Carlile: I join in the condemnation of this outrage by the right hon. Member for Manchester, Gorton (Mr. Kaufman) and also the sympathy he expressed for the lady who was injured. Will the hon. Gentleman confirm that it is his view that by far the best measure against terrorists within our shores is good police intelligence and constant vigilance by the police and the public? Is he satisfied with the level of police intelligence about terrorist groups that are formed and are situated within the shores of Great Britain?
Mr. Shaw: It would never be wise to say that one is satisfied with the level of intelligence that is available at any given time. I give the hon. and learned Gentleman my assurance and that of my right hon. Friend that the police, and especially the specialised departments that deal with terrorism, have real knowledge of what is going on in the United Kingdom. Perhaps the hon. and learned Gentleman will remember the events of last summer, which resulted in the interception of a major bombing campaign planned for resorts in the United Kingdom.
Sir Eldon Griffiths: Is it not highly irresponsible for people to try to relate this or any of the other terrorist incidents that we have experienced over the past 10 years or more to the incident that took place recently in Libya? Will my right hon. Friend welcome the statement by the Shadow Home Secretary that we shall not be intimidated and the statement by the Leader of the Opposition during business questions that tourists should come to our country because it is far safer than most other countries? In welcoming those things, will my hon. Friend bear in mind that throughout East Anglia members of the Labour party are saying that our air show should be cancelled because we are frightened of what is happening? How can the Opposition square those two approaches to the same problem?
Mr. Shaw: My hon. Friend is right. There is certainly no question that the incidents of recent weeks should cause us to suggest that Britain is less safe than it was. My hon. Friend is equally right that, throughout the country, people should go about their normal business in their normal way. I ask, as the police would wish me to ask, that everybody should remain vigilant at this time.
Mr. Chris Smith: In view of disturbing reports that in the immediate aftermath of the tragic incident this morning a considerable number

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of armed United States marines were seen in Providence court in the vicinity of the explosion, can the Minister tell the House whether the United States Government have permission to maintain what is effectively a private army on the streets of London?
Mr. Shaw: Frankly, I find the observations by the hon. Member for Islington, South and Finsbury (Mr. Smith) quite amazing. As far as I am aware, there is no connection between this incident—the relatively small size of which I have described to the House—and any of the hon. Gentleman's remarks about armed personnel or about the United States or anything else.
Mr. Michael Latham: What credence do the police place on the claims made by these so-called organisations? What credence do they attach to the claim made by the so-called Scottish National Liberation Army? Is that the same body which allegedly sent a postal bomb to the Secretary of State for Scotland recently? What are we doing to try to arrest these persons and put them behind bars?
Mr. Shaw: My hon. Friend is quite right; the organisation that claims responsibility for this incident also claims responsibility for the device which was sent to my right hon. Friend the Secretary of State for Scotland. We will do everything possible to ensure that those guilty of offences of this kind are brought to the courts and, one hopes, convicted.
Mr. David Clelland: Can the Minister help to clear up the matter of definition? While I accept what he has said about the possibility of the connection—or possibly there is no connection—between what happened today and what happened last week, we have had some arguments about definition on the Public Order Bill recently. Can he define a terrorist act? I agree that the precise placing of this device this morning in a shop doorway, obviously with the knowledge of the perpetrators as to what damage would be caused, is a terrorist act. If that is so, how much more of a terrorist act is it actually to drop such devices from an aeroplane, which, no matter how sophisticated, cannot be as precise as placing a device in a doorway?
Mr. Shaw: The hon. Member's question goes extremely wide of my statement. There is all the difference in the world between explosive devices, which try to trap individual citizens, and a Government who are seeking to impose terrorism as an act of policy. That is what the Libyan Government are seeking to do and it was in order to act against that that my right hon. Friend took the course she did.
Mr. Ivor StanbrookMy hon. Friend said that, so far as he knows, the perpetrators of this latest outrage were not directed from Libya. Will he tell us what has happened to the 21 Libyans recently arrested?
Mr. Speaker: Order. That question is particularly wide.
Mr. Ron Brown: While the House is pleased to hear that there is no Libyan or other link to this latest bombing outrage, will the Minister investigate the possibility that the CIA may be involved in terrorist activity in this country?
Mr. Shaw: No, Sir.
Mr. Andrew Faulds: Since only the White House or Israel could possibly welcome any renewed excuse for further attacks on Libya, will the right hon. Gentleman and his Department carefully consider the possibility of CIA involvement or Mossad involvement not only in this attack but in any other attacks that may occur?
Mr. Shaw: I do not think that the hon. Gentleman's observations are sufficiently serious to be given further credence.
Mr. David Sumberg: Will my hon. Friend ignore the ridiculous allegations of the hon. Member for Warley, East (Mr. Faulds)? Will he accept that terrorism is international and that it will be combated only by international action? That is why it is quite right that our right hon. Friend the Home Secretary is in Europe today and not in this House.
Mr. Shaw: I entirely endorse my hon. Friend's remarks.
Mr. Nicholas Soames: While I appreciate that it is still early for my hon. Friend to assign blame for this scandal, will he take time to condemn the Labour party in my constituency, which since the Libyan outrage, since the bombing by the Americans of Libya, has said that Crawley is now a prime target for attack because of its proximity to Gatwick airport? Will he deplore such scaremongering?
Mr. Shaw: I do indeed. The United Kingdom is party to the policy of seeing that terrorist organisations are refused access to this country and that we bring people to justice, and suitably convict them of the offences with which they are charged. It is stupid for people to suggest that these activities make this country more or less at risk.
Mr. Frank Cook: Can I press the Minister for a more specific response to the point raised by my hon. Friend the Member for Manchester, Gorton (Mr. Kaufman)—the amount of consideration given by the Prime Minister to any representations made by the Home Secretary on the need for tighter security, prior to the permission being given for the Libyan raid? Did such consultation take place, and what note was given to that consultation by the Prime Minister, prior to giving permission?
Mr. Shaw: The hon. Gentleman—
Mr. Speaker: Order. That has nothing to do with this question.
Mr. Peter Bruinvels: In acknowledging that this act has been cowardly and despicable, has my hon. Friend looked at the situation for all airline offices throughout this country and the need for extra vigilance and more police at those particular offices, in view of the fact that in other countries, particularly in the middle east, there are bombing outrages on middle east airline offices?
Mr. Shaw: My hon. Friend will be aware that airlines, particularly those operating international routes, are fully conversant with the problems associated with terrorism, and are well aware of the various levels of tension, which cause them to make special arrangements.

BALLOT FOR NOTICES OF MOTIONS FOR MONDAY 12 MAY
Members successful in the ballot were:

Mr. Malcolm Thornton.

Mr. Michael Fallon.

Sir Gerard Vaughan.

Orders of the Day

  Housing and Planning Bill
  As amended (in the Standing Committee), considered.
  Ordered,
  That the Bill be considered in the following order, namely, new Clauses, new Schedules, Clauses 1 to 4, Schedule 1, Clauses 5 to 10, Schedule 2, Clauses 11 and 12, Schedule 3, Clauses 13 to 24, Schedule 4, Clause 25, Schedule 5, Clause 26, Clause 34, Schedule 6, Clause 35, Clause 27, Schedule 7, Clauses 28 to 33, Clause 36, Schedule 8, Clauses 37 to 40, Schedule 9.—[Mr. Kenneth Baker.]

  Housing and Planning Bill
    New clause 11

      PROPOSALS FOR CO-OPERATIVE MANAGEMENT OR OWNERSHIP
      '.After section 27 of the Housing Act 1985 insert—
      "Proposals for co-operative management or ownership
      27A. — (1) If a qualifying tenants' association serves written notice on the local housing authority—

      (a) proposing that the authority should enter into a management agreement with the association with respect to dwelling-houses and other land specified in the notice, or

      (b) offering to buy dwelling-houses and other land specified in the notice at a specified price,

      the authority shall take the proposal or offer into consideration.
      (2) If the authority have not, at the end of the period of six months after service of the notice, entered into such an agreement or, as the case may be, accepted the offer, they shall give the association a written statement of the reasons why they have not done so.
      (3) A tenants' association is a qualifying association for the purposes of this section if—

      (a) it is a housing association of which at least half the members are tenants of dwelling-houses specified in the notice,

      (b) it has at least 50 such members or is registered under the Industrial and Provident Societies Act 1965, and

      (c) at least half the tenants of the specified dwelling-houses are members of the association.".' —[Mr. John Patten.]

      Brought up, and read the First time.
      5.15 pm
      The Minister for Housing, Urban Affairs and Construction (Mr. John Patten): I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Mr. Ernest Armstrong): With this it will be convenient to take the following: New clause 5—Financial assistance for tenants' organizations—
      'In part IV Housing Act 1985 after section 107 there shall be inserted the following section—
      "Duty to provide financial assistance for Tenants Organisations.
      107A.—(1) A landlord authority shall from its Housing Revenue Account for the purposes of housing management provide financial assistance to tenants' organisations representing secure tenants in its area.
      (2) The amount of grant payable to each tenants' organisation is an amount to be prescribed in Regulations calculated on a weekly basis by reference to the number of dwellings managed by the landlord authority in the area of that tenants' organisation.
      (3) The Secretary of State shall by Regulations made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament:—

      (a) prescribed the amount per dwelling to be provided in each grant,

      (b) determine the criteria by which the landlord authority—

      (i) shall distribute the grant loan and

      459

      (ii) approve and register tenants' organisations in its area and

      (c) specify the approved purposes for which such a grant may be spent.".'.

      Government amendments Nos. 24 and 149.
      Mr. Patten: On the 11 March, in our debate in Committee, I promised to bring forward an amendment to give tenants the right to request the setting up of a co-operative, and to place a duty in law on their landlord to consider that request, and give a reasoned response. This new clause fulfils that commitment.
      The proposed clause will enable tenants to form themselves into tenant associations to meet the criteria provided for in the clause to put forward proposals either for the delegation of management of their housing association, or alternatively, its sale to the association.
      I think I can reasonably claim that a consensus emerged during the Committee discussions.
      Regardless of political party, we all wish to see tenants' co-operatives fostered. This is one of the ways in which to give tenants a real say in the management of their estates. By promoting management co-operatives, we provided for restrictions on the right to exchange in and out of such co-operatives.
      Following concern expressed by the hon. Member for Woolwich (Mr. Cartwright), I have considered further the terms of clause 6. I have tabled amendment No. 24 to limit the landlord's discretion for withholding consent to those cases where the prospective tenant is not willing to become a member of a co-operative.
      The Government strongly favour giving tenants more real opportunities to have an effective say in the running of their estates, and new clause 11 provides the basis and mechanisms for the all important first steps in encouraging the formation of such co-operatives.
      Amendment No. 149 provides for the clause to take effect on an appointed day. New clause 11 thus allows tenants to initiate proposals, and, more importantly, gives them the right to a reasoned response.
      I have considerable sympathy for what the hon. Gentleman is seeking to achieve in new clause 5 which is to place a duty on local authorities to provide financial assistance for tenants' organisations. We know that for such organisations reasonable funding can make all the difference. I agree that local authorities should promote, encourage and support representative tenants' associations.
      Consultation and tenant involvement in management can only be effective when there are active tenants' associations. Whatever good intent is behind the reason for this clause, it raises serious matters of policy and principle which we cannot ignore. The issue both of principle and practice is that which asks the question, "What local organisation could not do without a bit of financial help?" Surely it would be wrong to place a duty on local authorities to pay grants for amounts, and to bodies, not of their choosing.
      Local authorities do not have a bottomless purse, whoever may be in control of them or of the central Government. They have to decide their priorities. They already have general powers and discretion to make payments to local groups in order to benefit the area.
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      Under their discretionary powers under sections 111 and 137 of the Local Government Act 1972, they can fix amounts and criteria themselves.
      New clause 5 seeks to provide that any grants would be provided from the housing revenue account. That would mean that all tenants would pay for the grants, but only those belonging to the tenants' association would get any benefit. There may be good reasons why some tenants do not wish to belong to an organisation. Under the new clause, they would be paying for something that they would not receive.
      We discussed in Committee the fact that tenants' organisations vary greatly and will continue to do so. We welcome the increasing variety of tenants' organisations, because none of us would claim to know the golden mean according to which they should be set up. We are still on a learning curve. In many places, the semi-experimental aeroplane still has to take off. Organisations evolve to suit the needs, conditions and resources of their members. New clause 11 provides for the Secretary of State to specify how tenants' organisations should be constituted and organised if they are to qualify for local authority support. The criteria will have to vary to suit local situations. It is therefore necessary that local authorities should have discretion. In the light of those comments I invite the hon. Gentleman to withdraw new clause 5 and I hope that there will be support for new clause 11 and amendments Nos. 24 and 149.
      Mr. Jeff Rooker: I should like to dispel any doubts that the Minister may have about new clause 11 by giving it a wholehearted welcome. It is a first-class new clause and does not need qualifying in any way. It would be niggardly to say that it does not go as far as we want, because it is in effect designed to meet the attempts of the Opposition in Standing Committee to give tenants the right to trigger off a management co-operative or, in other words, take from their public landlord the control of their own housing.
      The Minister said in Committee that we were going much too far too fast, and that the Government would consider an ameliorating measure to give tenants some legal authority to demand the setting up of a tenants' management co-operative and require the local authority to respond to that demand. The new clause is a foundation upon which all of us, including the tenants and the National Federation of Housing Co-operatives, can build. We shall watch closely what happens. My hon. Friends and, no doubt, many Government Members will actively ensure that tenants know about their new legal rights, and will make sure that we understand the reasons that authorities may give for turning down legitimate demands by tenants to get control of the management of all or part of their estates.
      We applaud the measure. The Opposition do not carry the vote, so the new clause does not go as far as we would have wished. However, we will give the measure 100 per cent. support and do all that we can to make the clause a reality.
      I accept what the Minister says about new clause 5. Unfortunately we were not able to discuss the matter in Committee and therefore we have not had the necessary background debate in respect of financial assistance for tenants' organisations. The Minister is quiet right. If new clause 11 is to mean something and to get off the ground,

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      we need strong, well-motivated and well-resourced tenants' organisations. New clause 5 represents an attempt to raise that issue.
      We shall not pursue the matter to a vote. We wanted the issue to be on the agenda so that the Government and their advisers and people outside could see that we consider that it is important. We shall return to the question on future housing legislation. I hope that the Minister will take on board the fact that we are serious about the matter. We were serious about our original proposals in Committee. We understand that our original suggestions about tenants' rights would not really work unless tenants were well resourced and well motivated, and that part of the resources would have to take the form of money.
      Unfortunately, because of the financial implications, we had to raise the matter here rather than in the other place. However, we welcome new clause 11 wholeheartedly and we shall ensure that local authorities—whether under Tory, Labour, Liberal or Social Democratic control—are on the receiving end of demands from their tenants to activate their rights under the new clause. If local authorities turn down such demands, we shall want to know why.
      Mr. Tony Marlow: The new clause seems to be worth while and far-reaching. However, as it is an important matter, will my hon. Friend explain precisely what will be involved? As I look at the clause with a non-legal eye, it appears to me that in a group of local authority tenants on a housing estate, if 50 or more such tenants, being at least half of the total, wished to join a qualifying tenants' association, that association could set up its own management, hire and put together its own management organisation and ask the local authority whether it could continue to be managed by the new management rather than the local authority. Alternatively, the tenants could go the whole hog, approach a financial institution, get the cash, ask the institution to back them, and buy, own and manage their own houses and community. Is that what the new clause means?
      Mr. John Cartwright: I welcome new clause 11. To be frank, I would have preferred legislation giving tenants clear rights to trigger the opportunity of establishing a co-operative. However, I understand the arguments deployed by the Minister in Committee and realise that that might be too dramatic a leap at the moment. I echo what was said by the hon. Member for Birmingham, Perry Barr (Mr. Rooker). I suspect that some local authorities of all political persuasions may be reluctant to encourage the development of housing co-operatives. It will then be up to those of us who believe passionately in the principle to bring our political muscle to bear on such authorities and try to make them see the importance of encouraging such development.
      I also echo what has been said about the need to provide adequate resources. At lunchtime today, some of us had the opportunity to attend a reception in the other place on behalf of housing co-operatives. I talked to a number of rank and file activists who were involved in the development of housing co-operatives. I was struck by the degree of patience that is needed. One cannot simply declare a co-operative and expect everything to fall into place automatically. Some of the people to whom I spoke
      462
      had spent two years or more in the formative process of developing a co-operative, understanding what is involved, and considering all the ramifications.
      As was said in Committee, not just money but time, effort, and energy will have to be invested in encouraging co-operatives and enabling ordinary tenants to take on such responsibilities. The new clause does not go quite as far as I would have liked, but it is an important step along the road. I welcome it.
      I also welcome what the Minister said about amendment No. 24. It involved a comparatively small point, but I am grateful to the Minister for accepting that, as drafted, the Bill appeared to run the risk of being unfair to some tenants. They might have been absorbed into some form of housing association and, as a result, have lost a reasonable right to transfer and exchange. I am grateful to the Minister for picking up that point and for dealing with it so fairly. I certainly support new clause 11 and amendment No. 24.
      5.30 pm
      Mr. John Powley: Like other hon. Members, I welcome new clause 11. I was the chairman of the first improvement areas committee way back in the 1970s, when that concept was rightly put forward by the Government of the day. Improvement areas committees were set up within the designated areas. We gave them every encouragement and the exercise proved to be very worth while, as I hope and believe this one will be.
      Those within an improvement area were enthusiastic. They elected their own chairman and secretary, and came up with ideas that the local authority thought about. I suspect that something similar will happen with tenants' associations. In the case of improvement areas, there was no financial support, or tag. We rightly depended on local effort and will and on local ideas. I believe that we got a very responsible organisation, just as I believe that this time there will be a responsible attitude from those who put in a lot of their own effort, give up their own time and incur perhaps some modest expenditure to be met out of their own pockets. The lack of a financial tag ensures that people use their own initiative instead of allowing the local authority to force something onto them using some financial inducement.
      I hope that a tenants' association will not be used by either side as a political weapon, and that party politics will not come into it. I also hope that people will join an association because they believe in the area, in what needs doing in it and in what the local authority could help them to do. Any political interference would tend to undermine the authority and stature of a tenants' association.
      I wonder whether my hon. Friend the Minister has given some thought to what would happen if there were owner-occupiers within the area. I think of the possibility of people who had bought their council houses becoming involved in whatever decisions or environment groups were suggested by the tenants' association. They would probably have more stake than anyone else in what was going on in the area. Both have considerable parts to play, but I believe that some thought should be given to the owner-occupiers.
      With those few words, I give the new clause a warm welcome.
      Mr. Simon Hughes: I have two brief comments to add to those of my hon Friend

      463
      the Member for Woolwich (Mr. Cartwright). Hon. Members may remember that my hon. Friend the Member for Liverpool, Mossley Hill (Mr. Alton) introduced the Right to Co-operate Bill under the ten minutes rule. Although the new clause is welcome it goes only half way down that road.
      I echo the remarks of those hon. Members who have said that we shall need a right to co-operate. The view is still prevalent that co-operatives are not the best form of management. Recently, I had a long local involvement with a block of properties in my constituency. The block is over the bridge, in Cooper close, just off the Waterloo road. It was under GLC ownership, but ownership recently passed to Southwark council. Despite the goodwill and massive effort of the occupants, some resistance has so far thwarted the attempts of all the block's occupiers to become a co-operative. That has happened despite the fact that the block is ideally suited to such an arrangement. Until we have the right, local authorities will be able to say no, and to reserve the matter entirely to local authority management.
      The new clause puts the pressure on, but falls short of achieving the aims of many people. The problem can be solved only by going down the rest of the road quickly.
      New clause 5 concerns financial assistance for tenants' organisations. My one caveat about it is that there is a danger in suggesting that there should be a national standard for the amount of money to be provided. That matter should be determined locally. All hon. Members will agree that as non-political, representative bodies, tenants' associations should be able to flourish and prosper. They should be well run and should serve the community well, while at the same time counteracting the power of the landlord. Indeed, that is very necessary, as the landlord normally has all the cards and all the knowledge.
      If central Government prescribe the proper amount, a danger arises. Local authority funds for housing should admit of an allocation for tenants' organisations and associations. I hope that we do not allow central Government to decide what should be permitted locally. That is my concern. I fear that the Labour party has a tendency to centralise everything. That tendency is still manifest, and I hope that it will be resisted.
      Mr. Chris Smith: As someone who worked for a considerable number of years in the housing co-operative movement before being elected to the House, I warmly welcome new clause 11. It represents a major step in the right direction.
      However, I take issue with the hon. Member for Southwark and Bermondsey (Mr. Hughes) over his remarks about the Labour party. My local authority of Islington has many management and ownership co-operatives. They are sponsored by the local authority, frequently in the face of carping criticism from local Social Democrats.
      I hope and trust that the Government, and those local authorities that seize the opportunity afforded by new clause 11, will not see it as a cost-cutting or saving exercise. Unless sufficient resources are made available to housing co-operatives to allow them to manage and maintain their properties properly, and unless resources are sufficient to enable them to run as co-operatives—
      464
      which is certainly no easy task for lay people—co-operatives may not achieve their potential. Consequently, I hope that the Government will not see the provision as a means of cutting expenditure but, rather, as a means of emancipating tenants and giving people the chance to exercise more control over their environment and their housing.
      Mr. John Patten: Emancipating tenants and putting people first is exactly what the new clause is all about in this new world of subfusc politics, in which we are all involved.
      The debates in Committee on tenants' co-operatives and the short debate today have shown Parliament at its best. Both sides of the House wish to improve the lot of one section of society. The Government have been prepared to go further than they had previously envisaged, but the Opposition have also recognised that although they would like to go further, there may be some sense in not going quite so far this time.
      Opposition Members have given due notice that they may wish to go a lot further at a later stage. Indeed, the Government and I also wish to go further. However, we live in a difficult and evolutionary world. Hon. Members on both sides of the House have spoken about the problems of setting up management co-operatives, about the practical difficulties and about the considerable personal commitment that is needed by those involved. We do not know where that evolutionary process will end. It could even end in the sort of thing that my hon. Friend the Member for Northampton, North (Mr. Marlow) mentioned in his brief speech.
      I think that new clause 11 and the associated amendments are a step on the way, and I commend them to the House.
      Mr. Marlow: If somebody wants to set up an organisation for co-operative management or ownership, and the local authority says that it does not want them to do so, even though it is manifestly the case that the majority of people who live in the community want it to go ahead, is there anything that they will be able to do under this arrangement? If not, is my hon. Friend considering bringing forward further amendments in the other place?
      Mr. Patten: I recall that we had quite lengthy debates on that in Committee. I commend what I said during those debates. It will not be possible under this legislation to force a recalcitrant local authority to say yes. However, I am convinced that once the issue is on the political agenda it will be exceptionally difficult for a local authority to say no under any circumstances. I think that we have the balance right and I think that both sides of the House recognise that we have it right for 1986. That is not to say that in 1989, 1992 or whenever, some future Government might not think that we have to go much further in many directions, all of which have been referred to during this useful short debate. With those words, I commend the new clause and the associated amendments to the House.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.

    New Clause 14

      TRANSITIONAL
      '(1) Until the end of the transitional period—

      (a) no offence is committed under section 58H of the Town and Country Planning Act 1971: and

      (b) no hazardous substances contravention notice may be issued, in relation to a hazardous substance which is on, under or over any land.

      if at any time within the establishment period the substance was present on, under or over the land in a quantity not less in aggregate than the controlled quantity.
      (2) Where a hazardous substance was present on, under or over any land at any time within the establishement period, hazardous substances consent may be claimed in respect of its presence.
      (3) A claim shall be made in the prescribed form before the end of the transitional period and shall contain the prescribed information as to the presence of the substance during the establishment period.
      (4) Subject to subsections (5) to (7) below, the hazardous substances authority shall be deemed to have granted any hazardous substances consent which is claimed under subsection (2) above.
      (5) If at the commencement date notification in respect of the substance was required by Notification Regulations, hazardous substances consent is only to be deemed to be granted under this section if notification in respect of the substance was given before that date in accordance with those regulations.
      (6) If at the commencement date such notification was not so required, hazardous substances consent is only to be deemed to be granted under this section if an aggregate quantity of the substance not less than the controlled quantity was present at any one time within the establishement period.
      (7) If it appears to the hazardous substances authority that a claim for hazardous substances consent does not comply with subsection (3) above, it shall be their duty, before the end of the period of two weeks from their receipt of the claim,—

      (a) to notify the claimant that in their opinion the claim is invalid; and

      (b) to give him their reasons for that opinion.

      (8) Hazardous substances consent which is deemed to be granted under this section is subject to the conditions that—

      (a) the maximum aggregate quantity of the substance that may be present—

      (i) on, under or over the land to which the claim relates;

      (ii) on, under of over other land which Is within 500 metres of it and controlled by the same person; or

      (iii) in or on a structure controlled by the same person any part of which is within 500 metres of it,

      at any time shall not exceed the maximum establishment amount; and

      (b) the substance shall be kept and used in the manner in which it was kept and used immediately before the commencement date.

      (9) In this section—
      "commencement date" means the date on which this Part of this Act comes into force;
      "the establishment period" means the period of 6 months immediately preceding the commencement date;
      "maximum established amount" means, in relation to any land—

      (a) where before the commencement date there has been a notification in respect respect of a substance in accordance with Notification Regulations, the quantity notified or last notified before the commencement date;

      (b) where such a notification was not so required, the maximum quantity which was present on, under or over the land at any one time within the establishment period;

      "Notification Regulations" means the Notification of Installations Handling Hazardous Substances Regulations 1982 or any regulations amending or replacing them;
      466
      "the transitional period" means the period of 6 months beginning with the commencement date;
      and other expressions have the same meanings as in the Town and Country Planning Act 1971.'.—[Mr. Tracey.]
      Brought up, and read the First Time.
      The Parliamentary Under-Secretary of State for the Environment (Mr. Richard Tracey): I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: With this it will be convenient to take Government new clause 15 and Government amendments Nos. 73 and 82.
      Mr. Tracey: New clause 14 would replace clause 20, which contains transitional provisions for the granting of hazardous substances consent in respect of land where hazardous substances are already being used. At the outset I should like to emphasise that the provisions of part IV are not intended to be confiscatory. Where a hazardous substance is lawfully being kept or used prior to the day on which these provisions come into force, it should, in principle, be allowed to continue to be kept or used in the same manner after that day. The Bill is intended to control new uses of such substances and increases in existing uses. Therefore, it is necessary to identify from the outset what is the entitlement of existing operators to keep or use any particular substance on their land. The function of clause 20 is to establish that initial entitlement.
      My hon. Friend the Member for Norwich, South (Mr. Powley) suggested in Committee that the existing clause is inadequate in a number of respects, and similar points have been put to us by the Confederation of British Industry. We are grateful for the representations made by my hon. Friend and by the CBI. Clause 20 as it stands would require existing operators to apply for hazardous substances consent. If the application is refused, compensation would be payable.
      This provision would impose a considerable burden on industry, which would have to make the case for retaining hazardous substances at each of the 2,000 or so sites where they are currently being kept or used. It would require hazardous substances authorities to consider whether to grant consent, which, in spite of the compensation provision, would inevitably open up questions about whether established uses of hazardous substances should be allowed to continue.
      5.45 pm
      I realise that there is an argument that authorities should be able to consider whether to discontinue the use of hazardous substances. The House will know, however, that local planning authorities already have power under section 51 of the Town and Country Planning Act 1971 to order the discontinuance of use subject to a liability to pay compensation. Hazardous substances authorities will have power under section 58(F) to revoke hazardous substances consent, similarly subject to a liability to pay compensation. Therefore, authorities already have general powers to reconsider any use of land involving the presence of a hazardous substance. They do not need the power to consider and refuse consent under clause 20 as it stands. To give them such a power would simply create uncertainty for industry.
      It is because of those criticisms that we have introduced the new clause in place of clause 20. Under the new clause, existing operators will be able to claim entitlement to hazardous substances consent and, unless the claim is

      467
      invalid, consent will be deemed to be granted when a claim is made. That will be a much simpler and more certain provision than the existing clause. I hope that it meets most of the points to which my hon. Friend the Member for Norwich, South drew attention in committee.
      I shall not detain the House by describing the new clause in great detail. It provides for a six-month period of grace during which claims may be made. The form of claim will be prescribed in regulations. Although the details of the regulations will require careful consideration, our intention is to require only straightforward factual information about matters such as the area of land and the quantity of the substance to which the claim relates and the manner in which the substance is kept or used.
      Where the substance is notifiable to the Health and Safety Executive under the Notification of Installations Handling Hazardous Substances Regulations 1982, consent will be deemed to be granted for the amount of substance last notified. In other cases, the consent will be deemed to be granted for the maximum amount that was present on the land in the six months preceding the commencement. In both cases the deemed consent will be subject to a condition that the substance shall be kept and used in the same manner as immediately before the commencement date. Those standard conditions, which are set out in subsection (8), are similar to those in the existing clause.
      I said that I did not wish to detain the House. However, I want to pay tribute to my hon. Friend the Member for Norwich, South and say how grateful we are to him for having raised this matter in Committee and for drawing our attention to the problems that are caused by clause 20. It has led us to reconsider the clause and come up with a proposal which is both simpler and less burdensome for operators and authorities alike.
      Mr. Powley: I express my grateful thanks to my hon. Friend the Minister for the care and trouble that he has taken to meet the points that were raised by the CBI and myself. I am grateful for the new clause and for the more flexible attitude that has been taken to the problems that we outlined to him.
      I have one slight reservation about the six-month period, which I hope my hon. Friend will take into account. He will be aware of the number of companies and the number of applications that will need to be made. One must consider the existing burden on the planning departments of many local authorities because of the other planning applications with which they have to deal and the pressure which they are under from those who make the applications. I hope that companies will make their applications within the period, but if some delays occur for administrative reasons, I hope that those circumstances will be taken into account and that firms will not be penalised for something which is no fault of their own.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.

    New Clause 15

      Transitional
      '(1) Until the end of the transitional period—

      (a) no offence is committed under section 56K of the Town and Country Planning (Scotland) Act 1972; and

      468

      (b) no hazardous substances contravention notice may be issued, in relation to a hazardous substance which is on, under or over any land,

      if at any time within the establishment period the substance was present on, under or over the land in a quantity not less in aggregate than the controlled quantity.
      (2) Where a hazardous substance was present on, under or over any land at any time within the establishement period, hazardous substances consent may be claimed in respect of its presence.
      (3) A claim shall be made in the prescribed form before the end of the transitional period and shall contain the prescribed information as to the presence of the substance during the establishment period.
      (4) Subject to subsections (5) to (7) below, the planning authority shall be deemed to have granted any hazardous substances consent which is claimed under subsection (2) above.
      (5) If at the commencement date notification in respect of the substance was required by Notification Regulations, hazardous substances consent is only to be deemed to be granted under this section if notification in respect of the substance was given before that date in accordance with those regulations.
      (6) If at the commencement date such notification was not so required, hazardous substances consent is only to be deemed to be granted under this section if an aggregate quantity of the substance not less than the controlled quantity was present at any one time within the establishment period.
      (7) If it appears to the planning authority that a claim for hazardous substances consent does not comply with subsection (3) above, it shall be their duty, before the end of the period of two weeks from their receipt of the claim,—

      (a) to notify the claimant that in their opinion the claim is invalid; and

      (b) to give him their reasons for that opinion.

      (8) Hazardous substances consent which is deemed to be granted under this section is subject to the conditions that—

      (a) the maximum aggregate quantity of the substance that may be present—

      (i) on, under or over the land to which the claim relates;

      (ii) on, under or over other land which is within 500 metres of it and controlled by the same person; or

      (iii) in or on a structure controlled by the same person any part of which is within 500 metres of it,

      at anyone time shall not exceed the maximum established amount and

      (b) the substance shall be kept and used in the manner in which it was kept and used immediately before the commencement date.

      (9) In this section—
      "commencement date" means the date on which this Part of this Act comes into force;
      "the establishment period" means the period of 6 months immediately preceding the commencement date;
      "maximum established amount" means, in relation to any land—

      (a) where before the commencement date there has been a notification in respect of a substance in accordance with Notification Regulations, the quantity notified or last notified before the commencement date;

      (b) where such a notification was not so required, the maximum quantity which was present on, under or over the land at any one time within the establishment period;

      "Notification Regulations" means the Notification of Installations Handling Hazardous Substances Regulations 1982 or any regulations amending or replacing them;
      "the transitional period" means the period of 6 months beginning with the commencement date;
      and other expressions have the same meaning as in the Town and Country Planning (Scotland) Act 1972.'.—[Mr. Tracey.]
      Brought up, read the First and Second time, and added to the Bill.

    New Clause 1

      RIGHT TO RENT
      '(1) Any person who has been registered on the housing waiting list of a local authority for more than one year shall have the right to occupy any vacant dwelling house owned by that authority which has been vacant and available for letting for a continuous period of at least six months.
      (2) The first prospective occupier who gives notice in writing shall be regarded by the authority as the tenant of the dwelling house and shall be liable for such reasonable charges as the authority may determine.'.—[Mr. Rooker.]
      Brought up, and read the First time.
      Mr. Rooker: I beg to move, That the clause be read a Second time.
      The clause gives to any person who is on a local authority housing waiting list for more than one year and who can find any vacant dwelling house owned by that authority which has been vacant and available for letting for a continuous period of at least six months the right to move in and make their home in that dwelling house. If necessary, those people will have to give notice in writing to the authority and pay such reasonable charges as the authority may determine for rent.
      Throughout the proceedings on the Bill, the Opposition have not and will not move any amendment or new clause which we would not be prepared to move in government. That is a warning not to the Government but to those outside this House, the local authorities. We seriously intend to do something about the outrageous scandal of empty housing. That scandal transcends the local authorities. The new clause relates strictly to local authorities because of the necessary constraints of the Bill.
      The last occasion when the matter was dealt with was in the necessary collection of information in April 1985. The information was supplied to me in a written answer on 19 December 1985. It revealed that, although local authorities at that time had 109,000 empty dwellings, there were still 500,000 empty houses in the private sector and there were 19,000 properties which were empty and were owned and controlled by the Government in the public sector.
      The Audit Commission's latest report on the management of council housing contains a breakdown of the reasons why these properties are empty. The Opposition accept that there are many reasons for properties being empty—reasons of flexibility, movement, the need for demolition, and repair. However, in March 1984—the date used by the Audit Commission—there were a total of 113,000 empty dwellings. Of that figure 26,000 had been empty for more than a year. Of that 113,000, no fewer than 27,700 were actually available for letting on the local authorities' own admission. Of that 27,700, some 1,900 had been empty and available for letting for more than a year. That figure was not dreamt up by me, by a pressure group or by the Government. That figure appeared on the local authorities' returns for their housing investment allocation bids. That is the figure used by the Audit Commission.
      The Audit Commission stresses that it is quite normal, when owner-occupied dwellings become empty, for someone to move out in the morning and someone else to move in that afternoon. That is a normal activity. As I said on Second Reading, it is scandalous that when local authority dwellings become empty someone must go into those dwellings to normalise them, which means that the
      470
      previous tenants' improvements to the property are ripped out to make all the properties the same. The local authorities which practise that kind of management should know better and I hope that the Audit Commission will sort them out. Someone must sort them out, as the Government clearly are not doing that. I hope that the Audit Commission's proposals on that part of its report are taken seriously.
      The Audit Commission modestly proposes that the re-let period should be no more than three weeks. We all know that the average period is a lot longer than that. There could be many improvements in management to help the process of re-letting and not all of those cost money. It is not simply a matter of finance, although I accept that in some areas and properties there is a problem about resources.
      I cannot avoid the fact that there are so many properties available for letting. That is not my phrase, that is the phrase used by the local authorities. They say that 1,900 dwellings are available for letting and have been so for more than a year.
      Mr. Marlow rose—
      Mr. Rooker: The new clause makes it clear that tenants and applicants on the waiting list should have a right to property available for re-letting after six months. We could thereby end the period for which authorities keep empty property. I shall not name the authorities involved as we wish to make progress but I shall raise the matter. We all know which authorities are involved.
      If the Government accept new clause 1, that would be a considerable step forward towards ending the scandal of empty properties. Having accepted new clause 1—as I hope the Government will—we could continue to deal with the empty properties owned by the Government and those in the private sector. The policy that keeps those properties empty prevents people from having homes. The Opposition want to make a start to correct that position and that is why I am moving new clause 1 in the hope that the House will approve it.
      Mr. Marlow: I find the Opposition's new clause very attractive and it has been well argued. However, can the hon. Member for Birmingham, Perry Barr (Mr. Rooker) tell me what he means by "available for letting"? The hon. Gentleman gave various figures but it seems to me that there are many houses that could be available for letting which might not at present be defined as "available for letting". I would like to know what the hon. Gentleman's definition of "available for letting" is.
      I would like to add a few more figures to those put forward by the hon. Gentleman. The Audit Commission's report is excellent and one of the best that I have seen on the subject. It states that the average period before a re-let in the shire districts is just under 10 weeks. That period in the metropolitan districts is about 13½ weeks and the period in inner London for some peculiar reason is more than four months.
      Obviously, if the process of re-letting can be done relatively quickly in some parts of the country, for example in the metropolitan districts, why can it not be done more quickly in inner London? I am sure that the hon. Member for Perry Barr and the Government have addressed themselves to these questions.
      Mr. Cartwright: I support the new clause. The way in which it was moved was a much-needed warning shot

      471
      across the bows of the local authorities concerned. However, there are some obvious problems about the drafting of the new clause which must be resolved before it reaches the statute book.
      The hon. Member for Northampton, North (Mr. Marlow) identified one of the problems. "Available for letting" is a term of art in terms of housing management. The difficulty in my constituency about many of the properties which stand empty for week after week and month after month is that when I investigate these cases I find that the properties are not technically "available for letting". These properties are awaiting a certain amount of redecoration or repair and are not available for letting in the local authority sense. Many of my constituents on the waiting list would happily move into those properties and carry out the decorating and repair work themselves if it were not for the restrictions that stop them doing so.
      There is also a problem about allowing the first prospective occupier who puts his name forward to take the property. Although I do not like the bureaucratic rationing that flows from some local authority allocation policies, we must have some regard to family size and need. Simply to allow a single person or childless couple to take the first three-bedroomed house that becomes available is wrong and poses practical problems. We must address the problem of local authority bureaucracy.
      Many of us have found that one of the difficulties is that there are so many different local authority departments involved in housing. A property might fall empty and the estate management team must then examine the property to find out what work needs doing. In my local authority, that means that the property must be referred to the department of architectural and engineering services, which examines the property again. If there is work to be done, that department refers the property to the works department to carry out the work. By that time the property has been empty for months and someone climbs into the property and vandalises it. The process of repair is then suspended for a year as there has been major destruction, fires and vandalism in the property. The result is that the authority must go out to tender for a major reconstruction job.
      I endorse what the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said. If the private sector can move so much more quickly to turn around empty property because the meter is ticking and it is losing money, why should the same approach not be applied to local government?
      I endorse the aims of the new clause but I have some doubts about its terminology and language.
      6 pm
      Mr. Powley: I can see some practical and administrative difficulties in the new clause, and no doubt my hon. Friend the Minister will have something to say about that when he replies. The number of empty properties in any local authority has always caused me great anxiety. When I was chairman of a housing committee, I always tried to ensure that the number of empty properties was kept to a minimum.
      I was staggered to find that at the end of last year Norwich city council had 652 empty council houses on its books. I am quoting the latest figures that have been made available to me. The hon. Member for Birmingham, Perry Barr (Mr. Rooker) has put a period of six months in his
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      new clause. Norwich city council's report of October 1984 shows that 156 properties had been empty for longer than six months. In March 1985 that had gone down a little to 120 properties, but by September 1985, the latest figure that I have, 170 properties had been empty in Norwich for longer than six months. That is a disgrace.
      I can see that there will be some problems. As the hon. Member for Woolwich (Mr. Cartwright) rightly said—he has great experience, as I am sure do other hon. Members—it is exceedingly easy for any local authority to say that a property that has been empty for some considerable time is not ready for letting for some reason. The front door could easily be taken off, or the fuses taken out of the fuse box, so that the local authority could say that a property was uninhabitable, and it would be right. Unfortunately, some local authorities might seek by such means to prevent a dwelling from coming within the legislation.
      I hope that the spirit of the new clause will engender the enthusiasm and the will to put empty properties back on to the market. I suspect that many hon. Members on both sides of the House will confirm from their experience in their surgeries that people who have been on the waiting list for a long time say that if only they could have a property they would do it up themselves at their own cost.
      I shall listen to the arguments put forward by my hon. Friend the Minister, but that may be a way of getting that disgraceful number of 170 properties in Norwich back on to the market so that those who are in genuine housing need and have the will and ability to do the necessary work for themselves can be housed. That will ultimately benefit them and the rest of the local authority.
      I give the new clause a warm welcome, but I am interested in the technical problems and I am sure that there are some that better minds than mine have thought of. With that proviso, I make those points in support of the new clause.
      Mr. Simon Hughes: The hon. Member for Norwich, South (Mr. Powley) referred to 176 empty properties. Since I was elected, my borough has had at all times about 4,000 empty properties, and that is from a housing stock of between 60,000 and 65,000. Despite the massive public awareness of the problem, the massive public pressure on the local authority to do something about it, and the massive repetition of the point which all hon. Members have made that week after week people say that they will do any necessary work, there has been bureaucratic resistance to letting go of the bureaucracy which impedes letting and reletting.
      The hon. Member for Birmingham, Perry Barr (Mr. Rooker), whose sincerity I do not question, put forward a solution. I share with my hon. Friend the Member for Woolwich (Mr. Cartwright) some scepticism. The hon. Member for Bootle (Mr. Roberts) and I, and possibly others, have introduced Bills to deal with the problem of empty property in the public and private sectors. There must be a mechanism whereby people can exercise the right, against the local authority that is compatible with their housing need and with their position on the housing list. This last requirement is necessary, because without it the position becomes anarchic.
      The terrible problem at the moment—the hon. Member for Norwich referred to it in part—is that if there are a huge number of empty properties, for example, 4,000, with an annual loss of rent and rates of £6 million,

      473
      as there is in my borough of Southwark, that leads to squatting and then legal proceedings are needed which eventually get people out, after which the properties are left in a terrible state. They are then promptly squatted again.
      If the system worked on the basis, not as the hon. Member for Perry Barr said, but whereby there was an estate agency principle for those properties that are clearly hard to let—for example, the top floors of tower blocks in my constituency—flats on these floors could be let to nurses, medical students or students, for example from Guy's hospital or the Polytechnic of the South Bank or to young single people. They could go the housing office and see what was available, put in a bid and provided that they were on the list and priority when dealt with in a fair way, they would be entitled to take up that tenancy. They could either do the work later themselves, or the local authority could do it, but clearly they would not have to wait to take over the property until the series of different local council departmental responsibilities had been either in theory or in practice carried out.
      The hon. Member for Perry Barr would probably accept that there is a technical difficulty about the first prospective occupier giving notice in writing. Clearly, that produces a sudden flurry of paper, and the first paper to land on a desk would entitle that person to the tenancy.
      What is salutary about the clause is that it makes it clear that there is rarely any excuse—and less in the public than in the private sector—for keeping empty a public asset, destined for housing those in need and those who ask to be housed. But as the problem is more widespread in the private sector, where there are over 500,000 empty properties, we must address that too.
      We should be able, through Parliament and local government, to deal with the problem in the public sector. As the hon. Member for Perry Barr and others well know, those who manage their housing stock badly, with massive amounts of empty properties, are more and more paying the penalty for that in simple electoral terms. Without going over the top, I predict that several seats will be lost by the controlling Labour group in Southwark to my colleagues next month, not least because of Labour's failure in Southwark to let empty properties to those in need. People cannot understand how any authority of any colour, which has a reputation and tradition of empty housing, is carrying out its housing duties and responsibilities.
      I hope that this message will be well heeded and that local authorities of all colours, particularly the most culpable Labour authorities in London, will respond quickly. Otherwise, they will continue to be in great dereliction of their duties.
      Mr. Richard Shepherd: The hon. Member for Birmingham, Perry Barr (Mr. Rooker) put fairly what most hon. Members on both sides of the House feel about the appalling mismanagement in certain cases of the allocation of council houses.
      The hon. Gentleman referred to the Audit Commission's report. That is a rather inspiring document, because there comes out of it some form of hope. The hon. Gentleman could have cited the fact that if the current national average relet period were to be reduced by two and a half weeks—the Audit Commission is of the opinion that that should be readily achievable by
      474
      comparing the performance of the best 25 per cent. of authorities of all types with the rest—an additional 20,000 houses would immediately become available.
      I know that it is easy enough wih every amendment that is tabled to say that there are insuperable difficulties or that the wording is not quite right and that the problem could be addressed in another way, but I urge my hon. Friend the Minister, who I know shares our anxiety about the large number of houses not immediately available for letting, to accept that there must be a way of tackling this. We look to the Minister in the hope that he is able to say that the Government will act to encourage councils, with much more force than they do at present, to make available houses for reletting more rapidly.
      Mr. John Patten: This has been an interesting debate. I do not wish to harm the hon. Member for Birmingham, Perry Barr (Mr. Rooker) in any way, but I greatly admired what he said. He got the debate off to a cracking start.
      We all agree that those responsible for public sector dwellings—local authorities or central Government—are doing a disservice to those who need homes by keeping such dwellings empty. I commend the hon. Member for Perry Barr, who gave a free-ranging, non-party political analysis of the situation.
      We must approach the debate on two levels. The first is the scandal of empty public sector properties, which we all deplore. I shall not go on about it any more, as the problem has been illustrated all too clearly by the hon. Member for Perry Barr, by my hon. Friends and by the speeches of alliance Members. We must decide whether the new clause will help solve that particular problem.
      If the hon. Member for Perry Barr and his hon. Friends, and the Members of the Liberal party and the SDP, are saying that we should isolate those councils which cannot manage their own stock and take some swift dirigiste measures to ensure that their stocks are managed better, I find that, personally and politically, extremely appealing. Somewhere down the line one must draw the line on inept and hopeless management. Exactly how one does that is the problem.
      Because of my centralising tendencies, I should like to do something much more vigorous about waste that harms society. I should like to do something much more radical about the scandal of empty public sector dwellings than we have done so far. I do not wish to be bureaucratic and boringly ministerial and say that there are many practical difficulties about the way in which the clause is drafted.
      Mr. Rooker: The hon. Gentleman is going to.
      Mr. Patten: Seven years in this place have given me sharper hearing than I used to have and, as the hon. Member for Perry Barr has just said, sotto voce, yes, I am going to.
      I do not think that the clause would work, as it would be bad law. It is not our job in the House to pass bad laws in the pursuit of good ends. The new clause attempts to force the hands of councils to get something done. The clause refers to "any person" or "any vacant dwelling house". I am sure that no one in this House would intend that a single person should suddenly become the tenant of a four-bedroomed house and the needs of a married couple, with three children, who have been on the waiting list for 10 years, should be overtaken. Who is to say when

      475
      an empty dwelling which is to be occupied should become available for letting? There are considerable problems of definition.
      How would the person on the waiting list stake his claim? The hon. Member for Southwark and Bermondsey (Mr. Hughes) had some interesting thoughts on how claims might be staked, and I shall certainly consider them, but how can such claims be dealt with ahead of people who have been on the waiting list for years?
      The clause as drafted would introduce a random element of legalised squatting, and I do not think that that is the right way to ensure that local authorities act with determination to get rid of voids. The Government have made clear their concern about empty public sector dwellings. In July 1985 the Government sent a circular to all local authorities on how to manage their stocks better. Good local authorities of all political colours have followed that advice and are managing their stocks better. When local authorities fail to do so, it is due to a lack of political will, managerial incompetence or a combination of the two.
      I do not believe that the new clause will help to solve the problem, and in some ways it could make certain problems worse. I entirely applaud the spirit in which the hon. Member for Perry Barr moved the new clause. I also appreciate the thought which my hon. Friends and hon. Members of the alliance parties have given to the matter. Alas, for reasons that I have given, I do not feel that we can accept the new clause. The all-party message is clear to those councils which keep empty flats and houses.
      Mr. Marlow: Will my hon. Friend consider the possibility of bringing forward amendments in another place to bring about some of the intentions which have been mentioned in the House this evening?
      Mr. Patten: I had not given way but had, in fact, finished my peroration—on a rather elegant and forceful note. My hon. Friend has caught me out before like this, and I suppose that he will carry on catching me out in this way. I think that it would be difficult to draft any amendments within the framework of the Bill which would make homesteading, or legalised squatting—if that is what my hon. Friend means—possible.
      6.15 pm
      If my hon. Friend is asking me to go very much further in a root and branch reform of the way in which local councils address the problems of empty dwellings and for the Government to offer help or coercion to make sure that they are filled, that is a much bigger task than we could hope to achieve in the Bill at this stage. However, I am sure that all local councils are now on watch. I am sure that the hon. Member for Bootle (Mr. Roberts), now that I am finally about to sit down, will agree entirely with what I have said.
      Mr. Allan Roberts: Surprise, surprise, I do not agree entirely with what the Minister has said. I find the Minister's approach to local government typical of the Government's approach. Either the local authority does as it should do, or as the Government think it should do, or the Government will interfere.
      The Minister spoke about his centralising tendencies. I hope that the new clause, which has been tabled by the Labour party, will be the hallmark of our method, when
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      we form a Labour Government, of dealing with the problems that are faced when local authorities do not manage their properties well or do not provide the standards that we expect.
      The Labour party's approach is to give rights to residents, voters and tenants to demand action or to take action. The pressure would not come from Whitehall and Westminster under the syndrome of "Whitehall and Westminster know best", but legislation would be provided which would put the pressure the other way. Action could be taken through the ballot box, and by individuals and community groups of electors, tenants and residents, and in that way these things could and would be put right. The clause has been tabled on that basis. We are not giving people the right to jump the queue for the houses which are available for people in need. People would not be able to jump in and obtain houses available for letting in advance of their turn as suggested by the hon. Member for Woolwich (Mr. Cartwright) but would obtain houses which had been standing empty for over six months.
      There are 668,000 empty homes in Britain and 105,745 of the stock—2·4 per cent.—are local authority stock. The clause is concerned, not with all those properties standing empty, which include the vast majority available for letting, but with the percentage of that figure which have been empty for more than six months or perhaps for more than 12 months.
      The hon. Member for Norwich, South (Mr. Powley) discussed the record of Norwich, but it has a good record compared with many other local authorities. The number of empty houses in Norwich represents 2·7 per cent of its stock, which is below the national average, and it has only 50 properties which have been empty for more than a year. It is those 50 or 100—if one takes the six-month period which is included in the clause —with which the legislation would deal. It is those properties which stand empty unnecessarily, not those which are empty but available for letting, which we wish to give homeless people or those in housing need the right to occupy.
      We do not want to give the impression that it is just the local authority sector which is at fault. In fact, 3·2 per cent. of the stock of housing associations is standing empty. According to the Department of the Environment's housing investment programme returns, the amount of privately rented stock that is standing empty is 0·6 per cent. The amount of privately owned property which is available for rent but which has been standing empty for a very long time is much greater than it is in the public rented sector.
      Mr. John Patten: I do not seek to defend the Government's reputation, but housing associations purchase and refurbish housing stock for later occupancy by their tenants. The houses and flats which they purchase are caught up in those figures when they are being rehabilitated.
      Mr. Roberts: I do not deny that fact, just as I hope that the Minister will not deny that the city of Manchester, which was referred to in the debate on 22 April, has 2,272 properties standing empty and available for letting and that 1,932 of the properties that were included in the figure that he vilified in our recent debate are in exactly the same position. They are void and awaiting demolition or

      477
      modernisation. If we are to be fair to the housing associations, we must also be fair to the local authorities, including the city of Manchester.
      According to the HIP returns, 6·1 per cent. of public sector property that is managed by the Property Services Agency is standing empty. It needs to get its house in order. There are many myths about empty property. If one does not know what lies behind the figures, one cannot understand them. That does not excuse the fact that many public sector properties are standing empty, although they could be occupied, and they would be occupied if this clause was included in the Bill. The clause is imperfect and could not be implemented as it stands, but I ask the Minister to examine it. He has been flexible on previous occasions. I hope that he will agree to introduce a clause in the other place that will deal with this problem.
      There are 40,000 people in short-life housing schemes. Many local authority and housing association properties would be standing empty if local authorities and housing associations had not done something about it. They have implemented the effect of this clause, although it is not included in the Bill. Many progressive and radical local authorities and housing associations have repaired properties that were standing empty and let them on licence. The Audit Commission estimates that 20,000 additional dwellings could be brought into use if a clause of this kind were included in the Bill.
      The Minister and the Government make much of the fact that empty properties are standing empty. They have every right to do so, but they do not have the right to say that, because properties are standing empty, that justifies their decision not to build new houses. The Opposition agree that it is a scandal that properties are standing empty unnecessarily. They agree that 20,000 properties should be brought into use. However, that is no justification for not building new council houses and modernising older council houses and making money available to deal with the housing crisis that faces this country.
      Question put and negatived.

    New Clause 3

      LEASEHOLD FLATS
      '(1) The Secretary of State shall by regulation give effect to recommendations contained in the Report of the Committee of Inquiry on the Management of Privately Owned Blocks of Flats (the Nugee Report) and such other matters as are complementary thereto.
      (2) The regulations referred to in the previous subsection shall attend to the following matters—

      (a) landlord's name and address;

      (b) service of notices;

      (c) agents' accountability to the landlord and the use of a receiver and manager;

      (d) appointment of managing agents and level of management fees;

      (e) management by registered housing associations;

      (f) application of minimum standards to blocks of flats;

      (g) end of economic life of blocks of flats;

      (h) service charges and sections 18 to 30 of the Landlord and Tenant Act 1985;

      (i) reserve and sinking funds;

      (j) insurance;

      (k) variation of unsatisfactory leases;

      (l) resolution of disputes;

      (m) residents' associations;

      (n) tenants collective rights of first refusal and right to buy.

      (3) The regulations referred to in this section shall be brought into force within 12 months of the passing of this Act.'.—[Mr. Fraser.]
      Brought up, and read the First time.
      Mr. John Fraser: I beg to move, That the clause be read a Second time.
      On Second Reading, the Opposition said that we would give every possible assistance to the Government in order to put into legislative form the recommendations of the Nugee committee on the management of leasehold flats. That remains our view. This clause is the last opportunity for the Government to accept our offer, although it would mean legislating by statutory instrument.
      I realise that, since the new clause was originally conceived and put down for consideration in Committee, the Government have said that they will implement Nugee in primary legislation next Session. We welcome that statement and the fact that the Government say that they will go further than Nugee and enable leaseholders collectively to acquire the freehold of a block of flats, if the landlord neglects his responsibilities. So far, so good: there is no great disagreement.
      However, the Opposition want even more than Nugee. It is important that leaseholders of flats should have the right to extend their leases in the same way as that right was given to leaseholders of houses under the Housing Subsidies Act 1967. Leaseholders of flats whose leases have 50 years or less to run find that they have a diminishing asset. It is difficult to obtain mortgages on such flats. That is not good either for individuals or for the state of the housing stock.
      Secondly, we do not believe that the right collectively to acquire the freehold should depend upon neglect by the landlord. The 1967 Act did not say that a precondition of enfranchisement should be the behaviour of the landlord. Many good freeholders manage leasehold estates. Dulwich college in my constituency is one example. That has never been an argument against the right of enfranchisement. The enfranchisement principle ought to proceed rapidly into law for both flats and houses. We shall expedite the passage of the Bill in the next Session of Parliament, but we shall want it to go further than even Nugee or the Government's response.
      Mr. Alfred Dubs: I appreciate that the Minister will say that he does not like such major matters to be the subject of delegated legislation, and I sympathise with his view. However, he will appreciate that there is widespread concern about the matter. Since I introduced my Ten-minute Bill on this subject, I have received many letters from all over the country. People are absolutely desperate that the difficulties in which they find themselves should be quickly remedied by legislation.
      I wish that the Government had taken note of the widespread feeling in the country. The Government support the Nugee report, but I hope that we can press them to go considerably further. Many leaseholders feel that the conditions are absolutely intolerable. The Government ought to have delayed this Bill a little longer in order to introduce the necessary measures to give effect to Nugee now, instead of making people wait for another year or more. Even at this late stage, I hope that the Government will say that they will consider what they can do and that, if necessary, they will introduce an amendment in another place. The Opposition would support such a move. As the will is there, why cannot the Government do it, even at this late hour?
      Mr. Simon Hughes: I support the new clause. The Nugee committee did a good job. It made a comprehensive list of recommendations. This sector has been considerably neglected. People have great difficulty in gaining control over either their long-term or their short-term destiny.
      The Secretary of State's written answer to the hon. Member for Westminster, North (Mr. Wheeler) provides a general outline of the Government's commitment to the recommendations of the Nugee report. Between now and the beginning of the next Session, I ask the Minister to examine whether some of the other recommendations can be included and whether the suggestions that this new clause contains can be taken on board. If it would be helpful, all parties could contribute to the discussion in the light of the recommendations and the Government's initial response. I am sure that the Minister wishes to maximise the impact of the legislation next year for the good of those in the private sector who will benefit enormously if Nugee, or even Nugee-plus, is implemented within a year from now.
      Mr. John Patten: I am in some difficulty over this new clause. I applaud its general drift and recognise that it reflects an all-party feeling that something must be done as quickly as possible for those in private leasehold blocks of flats.
      However, I believe it is right that the hon. Gentleman the Member for Norwood (Mr. John Fraser) should remind us that there are good landlords and managing agents who do a good job. I apologise to the hon. Gentleman. When he made his generous offer on behalf of the Labour Party, yesterday during Question Time, to assist with the passage of the Nugee recommendations through legislation, I thanked him for his offer of collaboration. I hope that was an uncharacteristic slip of the tongue; I meant to thank him for his co-operation. I do not suspect the hon. Gentleman ever of wishing to collaborate with the Conservative party.
      6.30 pm
      I was in the House to hear the speech that the hon. Gentleman the Member for Battersea (Mr. Dubbs) made on his ten-minute Bill. It is clear that members of the alliance and the Labour party and on this side of the House want to do something, but unfortunately a lot of detailed work must be done. I am not being bureaucratic or ministerial about this; I simply do not believe that putting Nugee-plus into effect in the way suggested will produce anything like good law; it will produce hopeless and muddled law. We must discuss the detail of some of these proposals much more with the interested parties. For example, the proposal to appoint a receiver and manager for the operation of the right of first refusal and the variation of defective leases raise intricate issues indeed that require careful drafting.
      Other points raised by the Nugee committee's report touch on matters outside the direct sphere of housing and my responsibilities. For example, the setting up of trust funds and sinking funds to deal with service charges raises complicated and difficult issues, as does the issue of insurance for these large blocks of flats. Many of the issues have implications for the rights and duties of landlord and tenant respectively, and they actually involve major changes to the landlord and tenant law. On some of the items listed as matters to be included in the regulations in the new clause—for example, the treatment of blocks of flats at the end of their economic life—the Nugee
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      committee made no specific recommendations, except to tell the Government to do something, but not how to do it. Until further work has been done, it is not possible to determine how far it will be practicable or desirable to implement the proposals by means of secondary legislation, which I do not believe would do the job well. Indeed, there is a risk that the enabling power would turn out to be inadequate to achieve what is needed.
      Recognising as I do the urgency of the situation, and the all-party will in the House to do something as quickly as possible, I think that this is the right way to do it. I wish that we could introduce legislation this Session but, without anticipating the Queen's Speech, I fear that we will not be able to do so. I hope that we can do something as soon as possible.
      Question put and negatived.

    New Clause 6

      REPEAL OF SECTION 2 OF THE REDUNDANT CHURCHES AND OTHER RELIGIOUS BUILDINGS ACT
      'Section 2 of the Redundant Churches and other Religious Buildings Act 1969 shall be repealed.'—[Mr. Freeman.]
      Brought up, and read the First time.
      Mr. Roger Freeman: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Mr. Harold Walker): With this it will be convenient to take amendment No. 98, in schedule 6, page 118, line 5, at end insert—
      '(2A) Section 56(1)(a) of the Town and Country Planning Act 1971 shall cease to have effect.'.
      Mr. Freeman: I am conscious that we are now moving to a debate not about people's houses and their right to leaseholds or freeholds, but rather about the issue of the preservation of churches of outstanding architectural merit. Although this is a different subject, I do not believe that it is in any way less important than the other issues that we have been debating this afternoon. My new clause repeals section 2 of the Redundant Churches and Other Religious Buildings Act 1969. Since 1969, that provision has permitted the Anglican Church alone to demolish listed redundant churches without seeking listed building consent.
      The Anglican Church is therefore in a unique position in relation to the other denominations. Having passed through all the excellent steps in the Pastoral Measure of 1983, which is currently in force, and having considered alternative uses for a church no longer in use, if the Church decides that the building should be demolished, irrespective of the fact that it is listed as a building of outstanding architectural merit, the Church alone has the right in the end to decide the fate of that building and, indeed, to demolish it.
      The new clause is designed to correct that anomaly and, at the end of that excellent procedure contained in the pastoral measure of 1983, to give the Secretary of State for the Environment the right of veto over the proposed demolition of that redundant church. I point out that this procedure is already applied to secular buildings that are listed. If a building is listed, the owner of the building must seek listed building consent to demolish the building. The new clause puts the Anglican Church in exactly the same position not only as other church denominations but as other owners of private property.
      Mr. Sydney Chapman: I understand and appreciate what my hon. Friend has said, but does he not agree that in the event many more listed secular buildings are demolished, and there are much greater safeguards, although the ecclesiastical exemption operates, for Church of England buildings. Although I understand what he says in theory, does he not agree that in practice there are much greater safeguards for the ecclesiastical achitectural heritage items that he and I are anxious to conserve?
      Mr. Freeman: I am grateful to my hon. Friend, but the short answer is that I do not agree with him. If he bears with me, I will come to his point in the logical sequence of my speech.
      I emphasise what is not covered by the new clause. It does not affect the ecclesiastical exemption for alterations under the faculty jurisdiction procedure for churches in use. That is a wider issue and my hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd) deals with it in amendment 98, which is grouped to be considered with this new clause. I am dealing with a narrower issue, concerned only with redundant Anglican churches. I am not suggesting in any way the scrapping of the Pastoral Measure provisions, which I believe have generally worked well. I ask for the ultimate right of veto for the Secretary of State, who would have the ultimate right to decide whether a listed redundant Anglican church should be demolished. After all, that was the recommendation of the Faculty Jurisdiction Commission's report in 1984 in sections 300 to 302.
      I now come to my hon. Friend's intervention. Why is this new clause needed? In defending it, I will deal briefly with the five objections that could be made against it. The first is my hon. Friend's point that the Church system works better than the secular or state system. I disagree. I suggest no change to the pastoral measure provisions of the 1983 Act. I want to see all those steps taken—the church examining alternative uses, a waiting period, and consultation with local authorities, conservation bodies and other interested groups. I want all that procedure to stay intact.
      What I suggest is a final additional stage. If the Church concludes that a building should be demolished—it has demolished 70 listed churches since 1969—I argue that the Secretary of State should have a right of final review. That is an additional safeguard; therefore, by definition more churches will be saved for the future. The new clause grafts on to an existing system one extra proviso. I hope that my hon. Friend the Member for Chipping Barnet (Mr. Chapman) is satisfied with that, answer.
      The second objection, of which I am aware from my postbag and public comment, is that the Church needs money from the sale of land underneath a redundant church. The Anglican Church is hard pressed to obtain financial resources. By demolishing a church, especially in the inner city, it might lay its hands on valuable resources which could be used to meet its pressing needs—for example, to provide service to the community and to pay salaries, stipends and pensions to the clergy and their dependants. If a building is listed as being of architectural merit, wider issues are involved than the mere value of the land underneath it.
      In a secular system we already apply the test that certain procedures must be followed before a building of outstanding architectural merit can be demolished. It is
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      wrong to put the Church in a different category from the private sector. Without being sacrilegious, I point out that British Rail, which has a large number of buildings of outstanding architectural merit, must go through the same procedure. It, too, is hard pressed.
      The Church owns about 50 per cent. of all grade 1 listed buildings. That is the size of the potential problem and a measure of the importance of the new clause.
      Mr. Chapman: My hon. Friend has said that the Church owns a high proportion of the grade 1 listed buildings. Will he confirm that only one Church of England grade 1 listed building has ever been demolished?
      Mr. Freeman: I can confirm that at least one such building has been demolished. That was a scandal, and I am grateful to my hon. Friend for drawing it to our attention. I am sure that he was referring to Holy Trinity church in Rugby. My right hon. Friend the Member for Henley (Mr. Heseltine), who was then Secretary of State for the Environment, rightly objected to the proposed demolition of the grade 1 listed church and asked the Church to undertake a further review of alternative uses. Sadly, the Church decided to demolish that building, and that was a great loss to our architectural heritage.
      The third objection is that, if the system is secularised, the Church's funding might be jeopardised or even withdrawn. The state already contributes about 60 per cent. of the resources of the redundant churches fund, so it is already an important and, perhaps, senior partner in the preservation of redundant churches. The counter-argument is that we are considering only an incremental burden—saving each year a few additional churches of outstanding architectural merit. That will present the redundant churches fund with an additional burden. I hope that the Anglican Church will not consider withdrawing its support. The excellent provisions of the Budget and the Finance Bill to encourage charitable giving by companies and individuals should benefit and enhance the resources of the redundant churches fund.
      Fourthly, it is argued that the proposed new clause and, perhaps, the broader proposals of my hon. Friend the Member for Aldridge-Brownhills are the thin end of the wedge in giving greater state control over the Church and are, perhaps, a step towards disestablishment. Since 1977, the state has been providing finance for the repair of churches. When the system was introduced nearly 10 years ago, a clear understanding was reached between the Church and the state that the state would provide finance for the repair of listed buildings and the financing of the redundant churches fund if the Church began the process of reforming its systems of building control and allowed the state, through the Secretary of State for the Environment, to exercise greater control and to contribute to reviewing the fate of some churches. That has been going on for 10 years—much slower than the pace of reform of parliamentary procedure—and there is little evidence of any action. I regret that. We are still waiting for action to be taken.
      6.45 pm
      The fifth argument against the new clause is that more building controls will impose a bigger financial burden on the Church. My hon. Friend the Member for Twickenham (Mr. Jessel) has advanced that argument, which is based on a misunderstanding. The listed building consent procedure does not mean blanket preservation. It means

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      that someone other than the owner of the listed building —the Secretary of State—would encourage alternative use and ultimately make a judgment on the fate of the building. The Church should support that positive step.
      This modest measure is supported by the Friends of Friendless Churches—I pay tribute to that organisation in promoting over many years the campaign for ecclesiastical exemption reform—by six conservation bodies, and by the Royal Institution of Chartered Surveyors, the Royal Town Planning Institute, the Association of District Councils, English Heritage, which is the public sector quango responsible for advising the Minister, and the Church's Faculty Jurisdiction Commission, which supported this move in 1984. I commend the new clause to the House.
      Mr. Richard Shepherd: My hon. Friend the Member for Kettering (Mr. Freeman) rightly said that my amendment No. 98 goes further than new clause 6. My measure is primarily intended to encourage my hon. Friend the Under-Secretary of State to disclose the Government's thinking on the future of ecclesiastical exemption. The exemption, embodied in section 56(1)(a) of the Town and Country Planning Act 1971, exempts those in charge of ecclesiastical buildings in use, of any denomination—a clear distinction from new clause 6—from the need to obtain listed building consent for their demolition, alteration or extension in such a way as to affect their character as buildings of special architectural or historic interest as would otherwise be necessary under section 55(1) of the Act.
      The exemption has a long and inglorious history. Its origins were in the Ancient Monuments Consolidation and Amendment Act 1913, when the then Archbishop of Canterbury successfully persuaded the House of Lords that the Church of England should not be subject to the ancient monuments legislation, on the grounds that its own faculty jurisdiction provided the necessary safeguards. When the concept of listed buildings was introduced in 1947, and extended in 1968, the exemption was carried through into the historic buildings legislation.
      The case against this exemption can be briefly stated. Ecclesiastical buildings are often the oldest, and in places the only, historic buildings in the community. They inspire great attention and interest in a wide range of people, not merely the worshippers. The law allows those in control of the buildings to make sweeping changes to them—even to demolish them, as long as part of the site remains "in ecclesiastical use"—without listed building consent and thus without the opportunities for public consultation and publicity to which such changes should properly be subject.
      The exemption is based on a series of nonsenses. The first is that it was originally based on the controls that the Church of England has; yet exemption applies to all ecclesiastical buildings and not simply to those of the Church of England. Other denominations have no equivalent of the faculty system and yet enjoy the benefit of the exemption. Large numbers of nonconformist chapels and Catholic churches have been radically altered or demolished without any public participation.
      The second is that the Church of England's faculty jurisdiction is in no way a proper substitute for listed building controls. It is sadly deficient in almost every
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      particular. It does not properly involve the local authority. It gives no locus standi to non-menbers of the congregation whose church is to be altered. There is no mechanism for enforcement, and breaches are widespread. Against this, the churches and ecclesiastical organisations concerned argue that liturgical changes should not be subject to control by local authorities. Not all demolition, alteration and extension work is required for liturgical changes, however.
      The Government themselves recognise the force of these criticisms, I know. In 1984, the Department of the Environment circulated a consultative document on the future of the extension.
      At the same time the Church of England published the report of its own commission on the continuing care of churches and cathedrals, which advocated a number of changes to the faculty jurisdiction to overcome its faults, but left the system largely intact.
      Almost two years have passed since the Department's consultative document, and the toll of ecclesiastical buildings continues. I think that the time is now right for the Government to make an announcement on the future of this outdated anomaly, and the amendment provides them with a suitable opportunity.
      Mr. Simon Hughes: It is ludicrous that the provisions covering buildings of particular national importance across the board are dealt with in a way that can involve the public in a mechanism that gives them local protection but does not apply to the vast number—50 per cent., as the hon. Member for Kettering (Mr. Freeman) said—of the buildings that fall into the category. There was, as the hon. Member for Aldridge-Brownhills (Mr. Shepherd) said, a historical precedent by which a protection was available before planning law developed after the war as it applied to churhces. Not only is that not truly a form of public law but in its procedures it is less effective, slower and less easily understood or participated in. I hope that the Minister can accept the amendment now or that he will find an early opportunity to introduce legislation so that this can be done soon.
      The amendment is short and simple, and it would be a good starting point. It is about time that we protected ourselves against the losses that can easily occur of buildings that are part of our heritage, of whatever denomination or of no denomination. This can happen under the present legislation, and the amendment would prevent it.
      Mr. Chapman: I have listened with care to the eloquence and expertise of my hon. Friends the Member for Kettering (Mr. Freeman) and for Aldridge-Brownhills (Mr. Shepherd), and I have come to a different conclusion. I invite the House not to accept the amendment or the new clause.
      I acknowledge that the law and regulations relating to ecclesiastical exemption are complicated and somewhat anomalous. Church of England churches in use, for example, and non-Church of England churches in use can be altered, extended or partially demolished without listed building consent. However, Church of England redundant churches require consent for alterations or extensions, although this is not required for total or partial demolition, if it is carried out in accordance with a scheme made under the Pastoral Measure. I accept that a non-Church of England church in use requires listed building consent for total demolition.

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      I wish to point out two matters that go wider. First, church buildings are now listed as, are all other buildings of architectural or historic interest, so that one has the same measuring rod whether a building is an ecclesiastical building of the Church of England or a secular building. Also, we are discussing a very narrow section of the planning laws related to listed building consent only. All Church of England buildings, indeed all church buildings, have no exemption from the normal planning controls.
      Some statistics are worthy of recording in this short debate. The Church of England has 17,000 churches, of which a very high proportion, nearly 12,000, are listed. Over 2,600 of those churches are grade 1 listings. My hon. Friend the Member for Kettering acknowledged that in the last 17 years at least, only one of those grade 1 listed chuches has been domolished. That is a very favourable record compared with the demolitions of secular buildings. In fact, the Church introduced provisions for the control of the demolition of buildings over 700 years ago. I therefore feel that I can say without fear of contradiction that the system has been tried and tested and, I think, has not been found wanting. It compares more than favourably with the control of listed buildings under the much later town and country planning legislation.
      The Church of England spends about £55 million annually on the maintenance and upkeep of its ecclesiastical estate, and only about one tenth of that figure, about £5 million a year, is provided by the state. That is a pretty good record of voluntary contribution. The result is a proven record of success. While I know that one can adduce statistics to prove almost anything, I would abide by the simple point that a listed church of England building has a three times better chance of avoiding demolition than a listed secular building. I suggest that it is tempting providence to change the rules now.
      In any case, I understand that discussions have been going on—
      Mr. Rooker: Tempting providence?
      Mr. Chapman: I thought that was a rather choice phrase. I always describe the recent terrible conflagration of York minster as an act of God. I think is is quite wrong that the state, let alone the Church Commissioners, did not take out insurance to prevent acts of God.
      As I say, discussions between the Department of Environment and the Church Commissioners are under way. I remind the House that the existing arrangements have been regularly honed and in the last 15 years Parliament, on three separate occasions, examined these carefully and approved the present arrangements. As to redundant churches, of which there are just over 1,000, three quarters have been saved. Of the 266 that have been demolished since the Pastoral Measure of 1969, only 62 were listed. That is the latest figure that I have. I stand to be corrected although clearly there will not be much difference.
      There are many more secular listed buildings—I think the total is about 338,000 currently listed, including the ecclesiastical ones. Last year alone, of those secular listed buildings 204 were demolished and permission was given for 2,372 to be partially demolished.
      The Church, in my view, has an extremely good record. Opposition Members may think that it is a typical Conservative remark to say, "Leave well alone." In my
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      view it would be in the interests of conservation and the protection of our wonderful ecclesiastical architectural heritage if we left the law exactly as it presently stands.
      7 pm
      Mr. Allan Roberts: The special pleading of the hon. Member for Chipping Barnet (Mr. Chapman) was on behalf of the Church and perhaps not on behalf of the Creator, if He is up there looking down upon us. I am sure He has a real regard for the buildings in which we worship. The people who administer those buildings may not have the same regard for them. I accept the figures the hon. Gentleman gave. I suppose there has not been a major attack on church listed buildings since the days of Oliver Cromwell; he probably altered more than most. Since then the record has been reasonable.
      Having listened to the amazing list from the hon. Member for Kettering (Mr. Freeman), I do not think we can treat the new clause lightly; it must be treated seriously. If there are organisations such as the Friends of Friendless Churches there is obviously a problem. I thought it was only animals that attracted such groups. If churches are at such risk that these organisations have to campaign for them, the new clause should be accepted. If the hon. Member for Chipping Barnet is right, and the Church does not want to demolish any empty listed church buildings, why should it object to the change?
      I am not sure that amendment No. 98 is so sensible. I hope the Minister will clarify the point. That amendment would affect alterations within a church which was still being used for worship. I have had representations from the Catholic bishop of Hexham and Newcastle, who said:
      "Following the II Vatican Council (1962–1965) we have made significant changes in our worship; this has entailed significant changes in the universal law of our Church about the internal ordering of our churches. Changes have had to be made, but this is done after consultation and with care and discretion."
      If a listed church is redundant, it should not be demolished without listed building consent. If it is to be converted into say, flats, planning permission should be sought for the change of use. If changes are to be made within a church for the purpose of worship, the provisions should remain as they are.
      If money is available and if there is Government support, the real issue is to deal with listed buildings which have fallen into disrepair. There is one such church in my constituency, the parish church of St. James. The roof is falling in. It is like the Roman Catholic cathedral in Liverpool. But it is a listed building; it is a beautiful building and we are desperately trying to get money to repair it. Perhaps the Minister could help me on that as well.
      Mr. Tracey: This has been an interesting ecclesiastical lagoon in the midst of what is primarily a housing and planning debate. I appreciate the sincerity of my hon. Friend the Member for Kettering (Mr. Freeman) in moving new clause 6 and of my hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd), who tabled amendment No. 98. I understand their reasons. Certainly the Church of England alone does not have to seek listed building consent for the total demolition of a listed church or of an unlisted church in a conservation area, given that the demolition is taking place under the pastoral measure. If the demolition is by faculty, consent is sought in the usual way.

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      The report of the Faculty Jurisdíction Commission recommended the modification or repeal of section 2, but that was rejected by the General Synod. It is fair to say that many people regret that. I am well aware of the depth of feeling which has manifested itself on both sides of the House and in the country at large.
      The subject of ecclesiastical exemption from listed buildings control arouses much feeling. When the Department put out its consultation document in January 1984 on the future of the exemption there were 136 responses. Some argued fiercely for the retention of the exemption; others argued equally fiercely for its abolition, and others simply wanted various modifications. To some extent those views have been reflected in our short debate in the remarks of my hon. Friend the Member for Kettering and my hon. Friend the Member for Aldridge-Brownhills, and then, suddenly, of my hon. Friend the Member for Chipping Barnet (Mr. Chapman), who has considerable expertise in matters of architecture and conservation.
      My hon. Friends know very well that my noble Friend the Minister of State, who has prime responsibility for the subject within the Department, has held discussions with representatives of the Church of England and the Churches Main Committee in an effort to find a way forward that would be acceptable to the churches, to the local authority associations and to the amenity societies. Those discussions have been going on for some time. We are getting to the point when they should perhaps draw to a conclusion; nevertheless they are continuing. My noble Friend still hopes that it will be possible to arrive at precisely the right, mutually acceptable solution. The speeches in the debate will be noted when the legislation goes to the other place. I remind my hon. Friends that not only will the Minister of State be there, but also the noble Lord, Lord Montagu, who is chairman of English Heritage.
      Mr. Marlow: I am not sure how my hon. Friend intends to finish his speech. If he were to say that he would accept the amendment, that the debate with the Church will take account of the fact that the Bill has been amended and, if the Church does not like the amendment, that it may come forward with a different amendment in the other place, everybody would be satisfied. We would at least come to a conclusion on the matter.
      Mr. Tracey: I am sorry to disappoint my hon. Friend, but I am not galloping at such a speed. There is considerable expertise in the other place, including that of the bishops, as I think the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said from a sedentary position. We want debate to take place on the matter so that we may find a mutually acceptable solution.
      The new clause and the amendment are somewhat premature. I hope that my hon. Friend will recognise my sincerity and that he will seek to withdraw the new clause.
      Mr. Freeman: On the assumption that their Lordships will read carefully the Official Report of this debate, I do not wish to detain the House longer. Therefore, I beg to ask leave to withdraw the new clause.
      Motion and clause, by leave, withdrawn.

    New clause 8

      DISPOSAL OF PUBLIC VACANT LAND
      'All vacant, dormant, derelict and underutilised land in public ownership listed on the register held at the Department of Environment shall be deemed for the purposes of this Act to be Simplified Planning Zones.'.—[Mr. Steen.]
      Brought up, and read the First time.
      Mr. Anthony Steen: I beg to move, That the clause be read a Second time.
      In a nutshell, the new clause is about waste. It is designed to help the Government in the objective, which they have put successively to the House and to the country, that derelict public land must be got rid of. It is not just derelict land that we must make better use of, but derelict public housing. On 1 April 1983 there were 305,000 houses which were difficult to let. One needs to reflect on the amount of waste in public housing. We have a great number of acres of public land that are not fully utilised.
      It is worth mentioning by way of introduction an answer to a question in April 1984, two years ago. The junior Minister in the Department, who is still the junior Minister there, told me that there were 766,779 sq m of vacant office space in public ownership. That figure is so astronomical that it is difficult to comprehend. We have a great deal of land, we have housing and we have office space that is totally vacant and surplus to requirements and we should get rid of it.
      The purpose of this new clause is to accelerate the sale of derelict, dormant, vacant and under-utilised land in public ownership. That means the ownership of land by Government, local government, health authorities, county authorities, district councils, water boards, the Coal Board, British Rail and electricity boards. The House knows the list; the amount of land is astronomical. We have had a number of debates about the scale fo the problem of vacant land. We have had a great number of Adjournment debates and questions and Ministers have always been helpful, but the House should know the scale of the present problem.
      Some people say that 100,000 acres of public land are vacant, dormant and derelict while others say it is one third of a million acres. The figures may be academic, but, in order to get precise figures, a former Secretary of State, my right hon. Friend the Member for Henley (Mr. Heseltine), said in 1981 that there was no point in talking about one third of a million acres or 100,000 acres and that it would be better to have a register. I was not a great supporter of the register because it seemed to me to be another delaying tactic, but to give my right hon. Friend his due, he set up a register and in July 1982 it showed that 95,329 acres of public land were registered. In January 1983 that figure had risen to 107,612 acres. In July 1983 it went up again to 110,543 acres, and in January 1984 it rose yet again to 112,167 acres of vacant, dormant, derelict and under-utilised public land.
      We know that a lot of vacant land is in public ownership and we also know that the amount of land on the register is only the tip of the iceberg. That is because there is no requirement to register land that is under one acre and a great deal of public, vacant, dormant and derelict land is under one acre. One does have to register land that is scheduled for use by a public authority within, I think, two years but it may have been reduced to one year. On 29

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      March 1984, there were 4,426 acres of unused and under-utilised land surplus to requirements in health authorities. Why should health authorities have 4,426 acres of publicly owned land that is not being used? Such land is a national, wasting asset and one that is not being used for the benefit of society. It is land that is hoarded by public health authorities.
      It is not just the health authorities that are at fault. Let us look at the Department of Energy, a Government Department. It has 311 acres of vacant land. What is it doing with that land? Why has the Ministry of Defence got nearly 2,600 acres of vacant land surplus to requirements? Why is that land not being used? But if the Ministry of Defence hoards 2,600 acres what about British Rail? Although people say that British Rail is improving, two years ago it had nearly 15,000 acres surplus to requirements.
      According to the figures that I have, on 1 January 1984, although British Rail had nearly 15,000 acres of vacant, dormant, derelict or under-utilised land, it disposed of only 1,000 acres. At that rate it will take 15 years to dispose of that land. I will not trouble the House by listing all the other public undertakings hoarding land that is vacant, dormant and derelict. However, I shall name a few of them. British Gas has 1,700 acres; the National Coal Board has 2,200 acres; the port authorities have 2,800 acres; the electricity boards have 3,600 acres; and the water authorities have 2,500 acres. So it continues.
      7.15 pm
      The amount of vacant public land that is not being used is a national disgrace and a national, wasting asset. I have mentioned the land on the register, but I should like to give the estimates of the amount of public, vacant land that is unregistered. The well-known and eminent authority on land use, Miss Alice Coleman of King's College, London, estimates that one third of a million acres of public land is lying dormant. It is that one third of a million acres which this new clause aims to correct.
      The purpose of the register was to provide a means by which the Secretary of State could direct the disposal of land hoarded by public authorities. That was why, in 1981, the then Secretary of State, my right hon. Friend the Member for Henley, set up the register procedure. He wanted to get the public authorities to put the land on the register and if they did not have good reasons for holding it, he could make orders for them to get rid of it.
      It was mildly disappointing that in answer to a parliamentary question on 21 March 1984, over two years ago, a junior Minister advised me that no orders for disposal of the land had been made. That means that two years ago no orders had been made, and the number of acres of land on the register continued to rise. The Government have put that right, and when-the Minister is replying to this short debate perhaps he will tell the House how many disposal orders have been made.
      I understand that the figure on the register today is no longer 112,000 acres, the figure that it was a year ago. It is now 110,000 acres. I congratulate the Government on reducing the number of dormant, derelict and under-utilised acres of land on the register by 2,000. At this rate it will take about 50 years to get rid of all the public land on the register, but about 300 years to get rid of all the dormant and derelict land in public ownership, not to
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      mention private ownership. By means of this new clause we seek to find a device to speed up the process by which this public, derelict land can be released.
      As the House will know, the problem of public, derelict land is not a new one. The then Secretary of State for the Environment, the right hon. Member for Bethnal Green and Stepney (Mr. Shore) produced a White Paper, "Policy for the Inner Cities", in 1976–77, in which he highlighted the problem of derelict land. The right hon. Gentleman told the House that he would write to every nationalised industry and ask them to review their holdings. I am afraid his letter in 1978 did not produce any goodies, because by 1981 one could not see whether any land had been released. The nationalised industries may have reviewed their holdings, but nothing much happened.
      The idea of the register was to focus attention on public authorities that were hoarding land, and was aimed at stimulating action. The House would like to hear from the Minister who is to reply what action is being taken, what action can be taken in future and what he feels about the time scale if it will take 40 or 50 years to release the publicly owned land that is on the register. The House, and I think all hon. Members, want to know why it is taking so long to release the land on the register, and what steps the Government will take to speed up the process. That is what the new clause is aiming to do. I think we must congratulate the Government in selling off the land and producing the orders, but it is all too slow and somewhat bureacratic.
      Perhaps I could be excused if I mention the splendid book—which I am sure all hon. Members will have read—which I wrote about four years ago called "New Life in Old Cities". [Interruption.] I am grateful for the Minister saying that it was a good book. I will send him a complimentary copy because I am told that it is much better than Horlicks.
      In that book, I suggested that the simplest way in which public vacant land could be released—I have asked many questions on this point since—is for the Government to auction it off to the highest bidder. It is an attractive idea. On the steps of the principal town halls of the country the mayor will be standing, wearing his chain saying, "What am I bid for this piece of land?" Why should it not go to the highest bidder, provided that there is a covenant that the land should be developed, shall we say in a year or two, so that if it is not developed it goes back into the auction market and to the private sector? At least it would get it moving.
      I suggested, to avoid a flood of land on the market by way of auction, that the public authorities should decide on 25 per cent. of their land that is surplus to requirement, and sell part of it off every year, so that it will take four years to get rid of their surplus requirement. At the present moment, with the amount of land on the register, it would take 30, 40 or 50 years.
      The Minister said on a number of occasions that the problem with the auction is the problem of negative land value. Let us avoid those sites which have negative land value, and just auction off the sites that do not, so that the amount of public vacant land on the register will be reduced.
      The Minister would be well advised not just to look at local authorities—although I am critical of local authorities—but also at the nationalised industries, and, just as important, the old Government Departments. The

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      Government cannot preach until they get their house in order. There is a lot of public land in Government ownership which should be released.
      We have to give the Government due credit because they have embarked upon a number of important approaches to release public vacant land. The Government have a derelict land grant on reclamation projects, and I am told that Government spending is in excess of £75 million this year. There are about 71 acres involved in reclamation most years. There are enterprise zones, which have reclaimed land, and there are the new town corporations, the Merseyside and London Docklands Development Corporations through to the regeneration of the Chatham docks.
      Perhaps most successful, there has been the urban development grant where £65 million of Government grant sparked off £295 million of private investment. Let it not be forgotten that this Government are the first to mobilise private money to reduce the amount of derelict land. There is the urban aid programme of some £300 million, and the joint public and private partnership. There is the Wavertree technology park, which has created some 2,000 jobs in the old marshalling yard in my former constituency.
      My right hon. Friend the Member for Henley was right to say that if we put public money in, private money will follow, but there are other ways of doing it which are quicker and more enterprising.
      I pass over inner-city enterprises, Operation Groundwork, the Liverpool garden festival, the new one in Stoke-on-Trent. In spite of all these wonderful initiatives, I still believe that there is one third of a million acres of land in public ownership which is vacant, dormant and derelict.
      Let us look at the consequences, and why this new clause is of such significance. An artificial shortage of land in the primary urban areas actually creates a force for development beyond the city boundaries on the good agricultural land outside, on the green field sites, and pressure is put on the green belt. If these vacant sites in public ownership are left surplus to requirement in the inner city, developers have to look outside it to build houses to satisfy the market demands.
      I want to give a specific example to the House to explain why this new clause has such relevance. In the city of Plymouth, which abuts my constituency, and is a large urban conurbation, the market forces, according to the city council, demand that it has a land bank of approximately five years' supply— around 250 acres, or 50 acres a year. Through good housing management, it managed to find this 250 acres. In 1980 it went to the Devon county council to talk about the structure plan and said, "If we look ahead, market forces will continue to demand more and more land for housing. We must go outside the city boundaries." That was included in the Devon structure plan for 1980. It was agreed that some 60 acres of prime agricultural land in my constituency of South Hams should be allowed to be built on, even though there were many many acres of dormant, derelict, public land within the Plymouth boundary. For example, there are some 200 acres belonging to the Ministry of Defence which is vacant, dormant and derelict. There is land belonging to the county education authority. There are many acres of land belonging to British Rail. What has happened is that
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      the Devon structure plan includes green field sites and agricultural land outside the city boundary. If this clause is passed, the simplified planning zones will apply to public vacant land and allow the owners of the land to release the land much more easily.
      I am pleading with the House this evening to agree to a clause that will enable our principal city areas to release their land much more easily. A simplified planning zone—which is the framework of this Bill—applied to this land would mean that instead of land outside the city boundaries being included in a structure plan—because there is a shortage of land inside the city—that land could be built on first.
      My information is that in Plymouth's case it would mean that the land outside could be taken out of the structure plan, and land inside in public ownership, whether Ministry of Defence, or the British Rail 20-acre Friary site, or the land belonging to the education authority, or horticultural land on the outskirts, could be used rather than good agricultural land outside.
      The Government have repeatedly said that public land must be sold off and that good agricultural land must be saved. They said that about the Okehampton bypass. They said "We must not go to the north of Okehampton, we must go south. We must go straight through the national park because is far better that we save the good agricultural land to the north." So too in Plymouth: they could use good derelict vacant land in the centre of Plymouth rather than go outside to use good agricultural land.
      All this new clause is doing is easing the problems for the Government. It is easing the planning regime when it comes to public vacant land on the register. It helps the developer; it gives them extra encouragement, and the incentive to buy public wasting land.
      This clause is about saving a national wasting asset. It will not solve all the problems, but it is a step in the right direction. It is another weapon in this Government's armoury in their battle to rebuild the inner cities and declining urban areas, and compel public authorities to stop hoarding land.
      I pay tribute to the Minister and his Department for what they have done to date. There is more to be done and I hope that the aim of this evening's debate is to help accelerate the sale not just of the 112,000 acres on the register, but of the other 200,000 acres of public vacant land which is currently being hoarded all over the nation.
      Mr. Allan Roberts: I hope that the Government are opposed to the new clause. The Opposition certainly are. It would have the interesting effect of declaring simplified planning areas in rural as well as inner-city areas. The hon. Member for South Hams (Mr. Steen) must have realised that, but he may not have realised how it would anger those of his hon. Friends who are opposed to simplified planning zones in rural areas.
      7.30 pm
      We do not want a major debate on the hon. Gentleman's simplistic view of how to deal with vacant, dormant and under-utilised land. The new clause refers only to land in public ownership. I represent an inner-city area where there is a great deal of dormant, derelict and under-utilised land, and I can tell the hon. Gentleman that the reason why it is in that state—whether it is in public or in private ownership—is that no one wants to use it. The hon. Gentleman suggests that builders are forced to go into green belts or other land that is not derelict or

      493
      dormant. In fact they prefer to do so because it is easier and cheaper to build on. Most dormant, derelict and under-utilised land has a negative value. In my constituency the development corporation has removed the negative value from much of that land, but private developers will still not build on it even though it is being made available.
      Things are not as simple as the hon. Gentleman suggests. However, we oppose the new clause because we do not want simplified planning zones spawning uncontrollably like amoebae all over the place.
      Mr. Steen: Why not?
      Mr. Roberts: If that is the intention, we might as well abolish planning altogether. No doubt some Government Members would wish to do that. People throughout the country are afraid that if, unfortunately, the Government were returned for a third term they would destroy planning as we understand it, which protects people and the environment.
      Mr. Tracey: The House is familiar with the ingenuity of my hon. Friend the Member for South Hams (Mr. Steen). His speech tonight was typical. He has ranged widely. The Government are grateful for the considerable compliment that he has paid them. In particular, my hon. Friend the Minister for Housing will be grateful for my hon. Friend's remarks about the pressure on authorities to dispose of derelict land.
      New clause 8 introduces an interesting proposition, which is superficially attractive but is not precisely relevant to what we are trying to do. The new clause would effectively and automatically designate all sites on land registers as simplified planning zones. No regard would be taken of the merits of individual sites so designated. It would not be possible for adjacent land to be considered concurrently with such sites as possible simplified planning zones. Some sites might not be suitable to be simplified planning zones at all. The new clause would remove some of the local planning authorities' discretion in deciding where simplified planning zones should be set up.
      Mr. Steen: I was grateful for the Minister's opening remarks. My point is that, in spite of the planning regimes, the Government's efforts and the many millions of pounds made available to release vacant public land, there are still 110,000 acres on the register. Something must be done to release that land. If it is not to be auctioned off, we must withdraw the planning regime that is preventing it being developed.
      Mr. Tracey: My hon. Friend can rest assured that we have taken careful note of what he said. We shall read his speech in some detail in order to see whether it contains a gem that we have missed.
      There is the question what sort of planning permission would be bestowed by the deemed simplified planning zones that my hon. Friend has mentioned. We do not want to declare SPZs and just tell people to go and fill in the details without regard to the circumstances of the case. I accept that a good number of sites on the land registers may well be suitable for inclusion in the simplified planning zone regime. However, we believe that we need a flexible and selective way of achieving our aim. The current provision in the Bill would do exactly what we are attempting to do. With all due respect to my hon. Friend, we do not believe that the new clause is needed. I hope that he will seek to withdraw it.
      Mr. Steen: Before I consider withdrawing the new clause, I believe that my hon. Friend the Member for Eastbourne (Mr. Gow) was just now rising to speak. I should like him to have the opportunity to say something if he wishes to do so.
      Mr. Ian Gow: I was indeed rising to my feet, but I believe that the House is anxious to make progress. In view of the Minister's reply, I hope that my hon. Friend will agree to withdraw the new clause.
      Mr. Steen: In view of those helpful comments, I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.

    New Clause 10

      SHORTHOLD
      'In the case of shorthold tenancies entered into after the coming into force of Part I of this Act the rent payable by the tenant to the landlord shall be the rent provided in the tenancy agreement and the rent officer shall have no power to vary the rent.'.—[Mr. Gow.]
      Brought up, and read the First Time.
      Mr. Gow: I beg to move, That the clause be read a Second time.
      It is certainly common ground among my hon. Friend's and it may even be common ground between both sides of the House, that whatever may have been the other consequences of the Rent Acts, which have been in force for 70 years, one undesirable consequence has been to dry up the supply of privately rented accommodation. It is also common ground between both sides of the House that in some areas there is a grave housing shortage. That housing shortage makes it especially difficult for those seeking a job to move from one part of the country to another.
      My right hon. Friend the Minister of State for the Armed Forces tried in the Housing Act 1980 to remedy that shortage of private rented accommodation. He introduced—and he was opposed by the Labour party—what is now known as shorthold. It is a precondition for the granting of shorthold in Greater London that a fair rent should be registered. Even outside Greater London, if a shorthold tenancy is entered into between landlord and tenant, with rent agreed between them, either the tenant or the landlord may make application to the rent officer to vary the agreed rent immediately after the agreement has been signed.
      Shorthold was designed to remove one of the disincentives to letting, which was the difficulty that landlords had in recovering possession, and the very long security of tenure given not only to the main tenant, but sometimes to members of his family. I believe that the shorthold provisions in the 1980 Act have had only a modest effect in increasing the supply of privately rented accommodation. In many areas there is still unused or under-used accommodation that the landlord—actual or potential—would be anxious to make available to those looking for accommodation if only there could be a reasonable return on his investment.
      That is why I believe that for all new lettings under shorthold—I emphasise that my new clause has no retrospective effect—the rent should be as agreed between landlord and tenant. The House will remember that the maximum period for shorthold is only five years. If, as I hope, my hon. Friend the Minister accepts the new

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      clause, some of those who are desperately anxious to find accommodation will have a better prospect of doing so. The potential landlord will be more willing to rent his property if he can get a decent return on his investment, which will make it worth while.
      Thus, the sole purpose of the new clause is to improve the prospects of those seeking accommodation. It is both economically and morally wrong for there to be unused or under-used accommodation because of an Act of Parliament or because of the Government's failure to take action which, in their heart, they know would alleviate the distress and hardship caused to many people. If my hon. Friend the Minister requires further time to examine the consequences of the new clause, as he may do, and if he cannot recommend it to the House tonight, I hope that he will at least give an undertaking that it may be possible to move a similar, if not identical, amendment in the other place.
      Mr. John Fraser: We are opposed to the new clause. We do not for one moment doubt that if landlords were able to let their properties in areas of acute stress without security of tenure, other than for the maximum period of five years, and without any rent control, there would be takers for it. However, it would lead to the grossest exploitation and ultimately to a vast increase in the responsibilities of housing authorities as shorthold tenancies came to an end and people found themselves bargaining lor an even higher rent or thrust back onto the local authority's homeless list. Of course landlords may feel inhibited about letting their properties if there are rent controls, but if one had to choose between protection for the tenant and uncontrolled rents, we would have no difficulty in saying that there should be protection for the tenant.
      The hon. Member for Eastbourne (Mr. Gow) was formerly the Minister for Housing and Construction, and we are left wondering to what extent he was speaking with some flavour of official Tory party policy.
      Mr. Marlow: Two subjects about which the Government, like the Opposition, are deeply concerned are unemployment and homelessness. We all want to overcome those problems—
      Mr. David Winnick: The hon. Gentleman should declare his interest.
      Mr. Marlow: Oh dear. The hon. Gentleman is so tedious. He knows that I own an element of rented accommodation which probably cost me somewhat less than his private house cost him.
      Like the Government, the Opposition are deeply concerned about homelessness and the problems of unemployment. One way of dealing with both of those problems at the same time is to increase the amount of accommodation available for rent. Another way of overcoming those problems is to help to ease mobility. There are jobs in some parts of the country that people cannot go to because they cannot find the accommodation. Equally, there are houses in other parts of the country that are blocked because, for good reasons, people do not make them available for others to live in.
      7.45 pm
      When, for some reason, a tenant moves out, the landlord may consider what to do. As things stand, if the
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      landlord put his property on the market, he would get a certain price for it. However, if he put a tenant in that property at the present rate of registered rents, the property's value would immediately fall considerably. Thus it is against his interest to put in another tenant. Consequently, property owners tend to sell their properties. That is why the private rented sector of accommodation has gone down and down. Yet it is that sector that should be the flexible part of the market that helps people to move from one part of the country to another.
      People cannot move from one council area to another. I know that there is a system of swaps and exchanges, but it is not particularly effective. Many people in the north-east and north-west come south looking for jobs. Someone might find a job but then discover that he cannot get the accommodation. In reality, the accommodation is available, but no one wanting to look after his family or his own self-interest would make it available. That is why we have shorthold. That prevents security of accommodation and prevents a reduction in the property's value. In those circumstances, it is in the interest of the owner to put in a shorthold tenant.
      What return will the owner of the property obtain for letting it? If the rent is restricted below the market value, the property could still be sold and the money could be invested elsewhere in order to obtain a better return on it. Thus an artificially low rent means that the property will not come onto the market.
      I totally agree with the new clause, and I hope that the Government will take the advice of my hon. Friend the Member for Eastbourne (Mr. Gow) and accept it.
      Mr. Winnick: As I intend to be brief, I shall not answer at length the points raised by the hon. Member for Northampton, North (Mr. Marlow) other than to say that last time the rented market was deregulated, fewer properties were available to rent, for reasons that we all understand.
      I am not surprised that the hon. Member for Eastbourne (Mr. Gow) should table this new clause. When he was Minister for Housing and Construction he lost the argument over deregulation. However, he resigned not over that but over something else. He lost, but not because the Cabinet disagreed with him. Rather, the Government were afraid that if his wishes were carried out, they would lose any chance of winning the next election. I fear that we have witnessed some sort of rehearsal, and that the hon. Gentleman hopes that the Government will accept step by step something that he has always advocated.
      If someone moves into rented accommodation and the rent is clearly exorbitant, it is only right and proper that he should be afforded some protection. But the new clause would remove any possibility of a tenant being able, under a shorthold agreement, to go to the rent officer to see whether his rent could be reassessed. The hon. Gentleman wants to take away that basic protection which tenants now have, even under shorthold. That is why I believe that it would be quite wrong for the Government to accept his new clause.
      Mr. Anthony Nelson: Not for the first or last time, my hon. Friend the Member for Eastbourne (Mr. Gow) has rendered the House a service, this time in moving the new clause. Those of us who were involved in the passage of the Housing Act 1980 felt that the

      497
      introduction of shorthold might lead to considerable advantages and opportunities, despite the Opposition's pledge that if they came to power they would repeal the legislation and extend security of tenure to tenants who benefited from it. Understandably and predictably that has had an effect on the number of shortholds that have been granted. That is regrettable, but it is an accepted Opposition power, which they no doubt relish.
      But as a result, homelessness in my constituency and elsewhere has increased. Indeed, many of those who are unable to obtain tenancies, where there is plenty of vacant property which could be made available on shorthold or other forms of tenancy at market rents, have had to search the public sector for available property, have swollen the housing waiting lists or have had to pay much higher rents than they would otherwise have had to.
      Opposition Members talk about the exploitation of tenants. The real exploitation is that many individuals and young people nationally are unable to obtain any low-cost rented accommodation at the present time. They are the homeless. The properties are available. If the law provides, and the Opposition give it a fair wind, the accommodation is there to satisfy much of the demand.
      The sole consequence of their stubborn opposition and the reluctance with which they are dragged into the 20th century of housing legislation is that hundreds of thousands of people are either homeless or paying exorbitant rents because of the Opposition's outdated ideology.
      When my hon. Friend the Member for Eastbourne was the Minister responsible for housing, he put forward proposals in this, as in other areas of the private rented sector, for liberalisation. I believe that he had in mind not only trying to ensure that more housing would be brought on to the market but that the dreadful plight of many people, especially young people, would be alleviated.
      As we approach the next general election, I hope that the Government will give serious consideration not only to the proposal contained in the new clause, but to revision of the fundamental Rent Acts which underlie the private sector, at least for new tenancies in the future. If we fail to do that we will continue to have a sore in the private sector of the housing market, and dissatisfaction and elongated waiting lists in the public sector and we will deserve the acrimony of our constituents.
      Mr. Cartwright: I know that the House wants to make progress. Therefore, I shall be as brief as possible. I want to make clear my opposition and the opposition of my hon. Friends to the approach in this new clause. I certainly support the view that we need a much greater supply of rented accommodation in this country, certainly in the areas of high housing stress. As I have made clear in previous debates on this issue, I do not believe that the best way to achieve that is to try to breathe new life into the old private rented sector which has been in decay and decline for the whole of this century.
      I believe that the relationships and atmosphere which surround the private rented market is such that we shall not get agreement about it. I fear that it will be impossible to encourage people to invest in that approach because it is a matter of considerable political difference between the two sides of the House. Therefore, we should be trying to build on the steadily emerging consensus of trying to find new forms of rented housing which do not have the connotations of the old private landlord. [AN HON.
      498
      MEMBER: "Assured tenancies."] Yes, provided of course by reputable bodies such as housing associations, building societies and pension funds—bodies of the sort which are not looking for a quick return or a quick kill. I am afraid that the difficulty of that approach is that it has the atmosphere, image and all the connotations of the old private landlord.
      I do not doubt for one minute the sincerity of some of the people who have taken part in the debate. However, I have some difficulty in believing that the sort of people who come to my advice centre on Friday nights, homeless and unemployed, will really be helped by having a free market in shorthold tenancies in London. I do not believe that we can have a free balance of bargaining between the landlord and the tenant in a situation of housing shortage such as we have in London. If we ever have that approach, I cannot believe that it will help the people who are in desperate need who cannot afford even the below market rents charged at present. Therefore, I am strongly opposed to the new clause. I hope that the Government will resist it.
      Mr. Steen: It is strange that we should have two new clauses, one after the other, dealing with waste. The House tends to talk about trying to change things which exist but the new clause that I had the honour to move and this new clause are both about wasting assets. The clause that I moved was about wasting public assets. It is curious that the Government should have rejected that. This new clause, which was moved by my hon. Friend the Member for Eastbourne (Mr. Gow) and for which I have a great deal of sympathy and support, has been rejected by the Opposition. That is perhaps a little more to be expected. Therefore, the deregulation of wasted public land was rejected in a proposal which I moved and now the deregulation of private housing waste is being rejected by the Opposition and the spokesman for the alliance.
      It is sad that in this country houses are empty and land is unused in the public and private sectors. We continue to argue in the House and nothing is being done to make use of those wasted assets. When the Minister replies, he should recognise that the House is concerned about waste.
      The Government have been concerned about waste in local authorities, and they want to privatise services to reduce it. We now have a third of a million acres of land wasting in this country. That should be dealt with. We now have private housing which is being wasted and we should deal with that.
      Mr. Deputy Speaker (Sir Paul Dean): Order. The hon. Gentleman is straying. I am finding it difficult to relate what he is saying to the new clause.
      Mr. Steen: I am sorry that you are having difficulty, Mr. Deputy Speaker. The point is being clearly made that my hon. Friend's new clause deals with waste. I am concerned that the Minister should deal with the waste of housing, just as he dealt with the waste of public land on the previous clause. The House wants to hear how we can use housing more effectively, whether in the private or public sector.
      If the Minister cannot accept the new clause, can he give some hope that private housing will be better used even if the new clause is not the device he would use? That is the point I was trying to make. I hope that it is now clear.
      Mr. Nick Raynsford: If we are concerned about waste, the most obvious example, and a symbol of

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      the present Government's housing policy, is a policy which, because it does not build homes for people in need, generates homelessness and means that far more is spent on accommodating the homeless in bed and breakfast hotels than it would cost to provide them with homes. That is what waste is about and that is the waste for which the Government are responsible.
      The new clause is irrelevant. It is based on a fundamental misconception of the causes of the decline of the private rented market. Anyone with any knowledge of the history of private renting over the past 100 years knows that, since the beginning of this century, the market has been in decline for fundamentally economic reasons—because the rate of return that a landlord can expect from renting property is less than he could get by selling it and investing in other assets.
      Mr. Steen: The Rent Acts.
      Mr. Raynsford: That has nothing to do with the Rent Acts; it has continued systematically over the past 70 years, whatever the hon. Gentleman might say, irrespective of whether the Rent Acts were strengthened or weakened. In fact, the greatest decline came after 1957, when the then Conservative Government sought to reduce controls—[Interruption.] Conservative Members would do well to listen to this. They ushered in the era that was known by the name of Mr. Rachman. He is a symbol of what happened when a Conservative Government sought to reduce tenant control and allow a free market.
      Mr. Geoffrey Dickens: I am grateful to the hon. Gentleman for giving way and perhaps he would like to listen to what I have to say. Is it not right that the hon. Member should declare an interest in this debate as he is funded by the housing Ministry? Should he not have declared an interest in the debate before he made his speech?
      Mr. Deputy Speaker: Order. We are beginning to stray a little. The new clause relates to shorthold, and a number of recent remarks have been difficult to relate to the subject under consideration.
      8 pm
      Mr. Raynsford: The only interest that I have to declare is that I have worked for 14 years in housing and I care deeply about the problems of housing.
      The reason I stressed that the new clause was both irrelevant and based on a misconception, is that it is assumed that creating short-term lettings will lead to a surge in the number of lettings coming onto the market. That is a misconception which the Conservative party adopted in the 1970s. After the introduction of shorthold under the Housing Act 1980, the decline in the private rented market continued at much the same rate as before, with only a derisory number of shortholds coming into existence. In London, the evidence for the first year of shortholds was that about 16,000 properties went out of letting in the private market and only about 300 shortholds were created. That shows that the whole shorthold experiement was misconceived and inappropriate.
      The evidence is that, when property is decontrolled, there will be exploitation and high rents and tenants will be subject to especially brutal pressures from landlords, as was the case during the Rachman era which followed the Rent Act 1957.
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      I stress that, for all these reasons, the new clause is taking us in an entirely inappropriate direction for housing policy. If the new clause is passed, private renting will continue to decline and there will be more options for exploitation in London, where people in shorthold tenancies will have to pay higher rents. I accept that there are very few of those people, so not many would be affected, but those in shorthold tenancies would suffer disproportionately.
      I sincerely hope that the new clause is decisively rejected.
      Mr. John Patten: Most hon. Members are aware of my views about empty housing and homelessness. I profoundly believe that somewhere in the equation of the more than 500,000 private empty flats and houses, and the perhaps 90,000 or more registered homeless, it is possible for sensible men of good will to find ways of unlocking that empty accommodation and so make it possible not only to house the homeless but to help young people and stop the degrading scramble for accommodation by young people seeking jobs in our great cities and for accommodation in our university towns.
      I do not like deeply entrenched, long-held views which people are not prepared to reconsider. I much prefer the more modern approach put forward by the SDP spokesman, the hon. Member for Woolwich (Mr. Cartwright). He showed that, although he is worried about what would happen should there be a measure of deregulation, the alliance has said that it is prepared to consider measured forms of deregulation, such as extensions to the shared tenancy scheme, where it introduces new forms of finance from building societies, responsible and respectable institutions and others. We should go down that road, across the Chamber, to see whether we can do something to unlock the supply of empty, privately rented homes, in the interests of those who need accommodation, be they the homeless, the young or the mobile job seekers.
      Having said that, I believe that the shorthold tenancy scheme is excellent. It has done much to help in the way that it was designed to do, and therefore I welcome the way in which my hon. Friend the Member for Eastbourne (Mr. Gow) introduced his debate on shorthold tenancies. The new clause proposes the removal of the shorthold tenancy scheme from the fair rents system. My hon. Friend wants to deregulate—doubtless he will correct me if I am wrong—all lettings made on shorthold after the date on which part I comes into force, both inside and outside London.
      My hon. Friend explained the differences that exist in the shorthold scheme between London and other areas under the provision of the Housing Act 1980, introduced by my right hon. Friend the Member for Tonbridge and Mailing (Mr. Stanley) who is now the Minister of State for the Armed Forces. My hon. Friend the Member for Chichester (Mr. Nelson) played an important part in helping that Act on to the statute book.
      I hope and believe that my hon. Friend the Member for Eastbourne has today tabled a new clause which is essentially a probing amendment. I have recently spoken in the House about the privately rented sector. My right hon. Friend the Prime Minister and I have said that any legislation in the complex area of rent control must wait until after the next general election.

      501
      The shorthold tenancy scheme was not designed as a deregulation measure. That is quite clear, and it does not make sense to turn it into one and to deregulate on this type of tenancy alone. We would therefore get partial deregulation, and that would create some difficulties. We must consider the whole system of rent control and see which groups of people fall inside and outside the system, and not insulate those who choose a specific form of letting agreement.
      I hope that my hon. Friend the Member for Eastbourne will accept my assurances that the Government are looking hard at the options for the private rented sector. We are persuaded of the need for reform. I hope and believe my hon. Friend feels that we should legislate rationally and nationally, at the correct time, over the whole area of renting, rather than pick on one valuable and partial scheme for partial deregulation, which would lead to a greater element of confusion in the short term rather than achieve the major aims of the Government to house more people in empty houses and flats which should not be empty because of the workings of the Rent Acts. I hope that my hon. Friend will consider withdrawing his new clause after hearing my comments.
      Mr. Gow: I cannot conceal from the House my disappointment at my hon. Friend's reply. However, I think that it would be appropriate that I should beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.

    New Clause 12

      GRANTS FOR IMPROVEMENT OR REPAIR OF COMMON PARTS
      '. Part XV of the Housing Act 1985 (grants for work of improvement, repair and conversion) is amended in accordance with Schedule (COMMONS PARTS GRANTS) so as to provide for a new form of grant towards the costs of works required for the improvement or repair of the common parts of a building containing one or more flats.'.—[Mr. Robert B. Jones.]
      Brought up, and read the First time.
      Mr. Robert B. Jones: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker (Sir Paul Deal): With this it will be convenient to discuss the following: new clause 16—Grants for flats and maisonettes—
      'For the avoidance of doubt it is hereby declared that a repair and improvement grant under the Housing Act 1985 may be given notwithstanding that the repair or improvement benefits more than one dwelling house or flat.'.
      Amendment No. 1, new schedule—Common Parts Grants—
      1. — (1) Section 460 of the Housing Act 1985 (general description of main grants) is amended as follows.
      (2) In subsection (1) omit the word "and" after the reference to special grants and after the reference to repairs grants insert "common parts grants (sections 498A to 498G)".
      (3) In subsection (2) for paragraphs (b) and (c) substitute—"

      (b) the improvement or repair of dwellings,

      (c) the improvement or repair of the common parts of a building including one or more flats, and"

      2. In section 462(1) of the Housing Act 1985 (preliminary condition for grants: the age of the property), after paragraph (b) insert ", or

      (c) a common parts grant in respect of a building which was erected after 2nd October 1961.".

      3. In section 463(1) of the Housing Act 1985 (preliminary condition for eligibility for grant: the interest of the applicant in
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      the property) for "may entertain an application for a grant only if' substitute "shall not entertain an application for a grant, other than an application for a common parts grant, unless".
      4. After section 464 of the Housing Act 1985 insert—

      Preliminary conditions for application for common parts grant
      464A. — (1) A local housing authority shall not entertain an application for a common parts grant unless they are satisfied as regards the relevant works that the applicant either—

      (a) has a duty to carry them out, or

      (b) has power to carry them out (there being no-one under a duty to carry them out) and has a qualifying interest in the building or in a dwelling in the building,

      and that, at the date of the application, at least the required proportion of the dwellings in the building is occupied by tenants,
      (2) The following are qualifying interests for the purposes of subsection (1)(b)—

      (a) an estate in fee simple absolute in possession,

      (b) a term of years absolute of which not less than five years remains unexpired at the date of the application,

      (c) a tenancy to which section 1 of the Landlord and Tenant Act 1954 applies (long tenancies at low rents),

      (d) a protected tenancy, a secure tenancy, a protected occupancy or a statutory tenancy;

      (e) a tenancy which satisfies such conditions as may be prescribed by order of the Secretary of State.

      (3) The required proportion mentioned in subsection (1) is three-quarters or such other proportion as may be—

      (a) prescribed for the purposes of this section by order of the Secretary of State, or

      (b) approved by him, in relation to a particular case or description of case, on application by the local housing authority;

      and "tenant" for the purposes of that requirement means a person who has an interest within any of paragraphs (b) to (e) of subsection (2) by virtue of which he occupies a dwelling in the building as his only or main residence.
      (4) An order under this section—

      (a) may make different provision with respect to different cases or descriptions of case, including different provision for different areas, and

      (b) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

      (5) This section has effect subject to section 513 (parsonages, application by charities, &c.)".
      5. In section 466(1) of the Housing Act 1985 (grants requiring consent of the Secretary of State) for "or intermediate grant" substitute ", intermediate grant or common parts grant".
      6. After section 498 of the Housing Act 1985 insert—

    COMMON PARTS GRANT

      Works for which common parts grants may begiven
      498A.—(1) The works for which a common parts grant may be given are works required for the improvement or repair of the common parts of a building in which there are one or more flats, other than works for the provision of a dwelling.
      (2) For this purpose—

      (a) "flat" means a dwelling which is a separate set of premises, whether or not on the same floor, divided horizontally from some other part of the building, and

      (b) "common parts" includes the structure and exterior of the building and common facilities provided, whether in the building or elsewhere, for persons who include the occupiers of one or more dwellings in the building.

      Standard of repair to be attained
      498B. — (1) The local housing authority shall not approve an application for a common parts grant in respect of a building unless they are satisfied that on completion of the relevant works the common parts of the building will be in reasonable repair.
      (2) If in the opinion of the authority the relevant works are more extensive than is necessary for the purpose of securing that the common parts of the building will attain that standard, the authority may, with the consent of the applicant, treat the application as varied so that the relevant works include only such works as seem to the authority necessary for that purpose; and they may then approve the application as so varied.

      Ratable value limit.
      498C.—(1) The local housing authority shall not approve an application for a common parts grant in respect of a building if, on the date of the application, the average rateable value of the dwellings in the building exceeds the limit specified for the purposes of this section by order of the Secretary of State.
      (2) The consent of the Treasury is required for the making of an order.
      (3) An order—

      (a) may make different provision with respect to different cases or descriptions of case, including different provision for different areas, and

      (b) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

      (4) For the purpose of this section—

      (a) where a dwelling is a hereditament for which a rateable value is shown in the valuation list, the rateable value is the value shown;

      (b) where a dwelling forms part only of such a hereditament, or consists of or forms part of more than one such hereditament, the rateable value is such value as the local housing authority, after consultation with the applicant as to an appropriate apportionment or aggregation shall determine.

      (5) This section does not apply to buildings in housing action areas.

      Common parts grants are discretionary
      498D. — (1) A local housing authority may approve an application for a common parts grant in such circumstances as they think fit.
      (2) Subsection (1) has effect subject to the following provisions (which restrict the cases in which applications may be approved)—

      section 465 (works already begun),

      section 466 (cases in which consent of Secretary of State is required),

      section 498B (standard of repair to be attained), and section 498C (rateable value limit).

      Common parts grants: estimated expense of works.
      498E. — (1) Where a local housing authority approve an application for a common parts grant, they shall determine the amount of the expenses which in their opinion are proper to be incurred for the execution of the relevant works and shall notify the applicant of that amount.
      (2) If, after an application for a grant has been approved, the authority are satisfied that owing to circumstances beyond the control of the applicant the relevant works will not be carried out on the basis of the estimate contained in the application, they may, on receiving a further estimate, redetermine the estimated expense in relation to the grant.
      (3) If the applicant satisfies the authority that—

      (a) the relevant works cannot be, or could not have been, carried out without carrying out additional works, and

      (b) this could not have been reasonably foreseen at the time the application was made,

      the authority may determine a higher amount under subsection (1).

      Common parts grant: limit on expense eligible for grant
      498F.—(1) Except in a case or description of case in respect of which the Secretary of State approves a higher eligible expense, the eligible expense for the purposes of a common parts grant is so much of the estimated expense as does not exceed the prescribed amount.
      (2) In subsection (1) "the prescribed amount" means an amount prescribed, or ascertained in a manner prescribed, by order of the Secretary of State.
      (3) An order—

      (a) may make different provision with respect to different cases or descriptions of case, including different provision for different areas, and

      504

      (b) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of the House of Commons.

      Commons parts grants: determination of amount.
      498G. —(1) The amount of a common parts grant shall be fixed by the local housing authority when they approve the application, and shall not exceed the appropriate percentage of the eligible expense.
      (2) The authority shall notify the applicant of the amount of the grant together with the notification under section 498E(1) (notification of estimated expense of relevant works).
      (3) Where the authority redetermine the amount of the estimated expense under section 498E(2) (new estimate where works cannot be carried out in accordance with original estimate), they shall make such other adjustments relating to the amount of the grant as appear to them to be appropriate; but the amount of the grant shall not be increased beyond the amount which could have been notified when the application was approved if the estimate contained in the application had been of the same amount as the further estimate.
      (4) Where the authority redetermine the amount of the estimated expense under section 498E(3) (redetermination where additional works prove necessary), the eligible expense under section 498F shall be recalculated and if on the recalculation the amount of the eligible expense is greater than it was at the time when the application was approved, the amount of the grant shall be increased and the applicant notified accordingly.".
      7. In section 499(3) of the Housing Act 1985 for "this Part" substitute "the following provisions of this Part down to section 507".
      8. In section 511 of the Housing Act 1985 (payment of grants: general), in subsection (3) (b) for "or repairs grant" substitute ", repairs grant or common parts grant".
      9. In section 513 of the Housing Act 1985 (special cases; parsonages, applications by charities, &c.), in subsection (2) (provisions disapplied) after the reference to section 464 omit the word "and" and insert—
      "so much of section 464A(1) (b) (preliminary conditions for application for common parts grant) as requires the applicant to have a qualifying interest in the premises, and ".
      10.—(1) Section 514 of the Housing Act 1985 (power of local housing authority to carry out works with agreement of person by whom application for grant might be made) is amended as follows.
      (2) For subsection (2) (definition of "requisite interest") substitute
      "(2) The reference in subsection (1) to a person having the requisite interest is, except in the case of a common parts grant, to a person who has an owner's interest in every parcel of land on which the relevant works are to be carried out; and in this subsection "owner's interest" has the same meaning as in section 463(1) (a).
      (2A) The reference in subsection (1) to a person having the requisite interest is in the case of a common parts grant to a person who as regard the relevant works either—

      (a) has a duty to carry them out, or

      (b) has power to carry them out (there being no one under a duty to carry them out) and has a qualifying interest in the building or in a dwelling in the building;

      and in this subsection 'qualifying interest' 'has the same meaning as in section 464A(1) (b).".
      11. In Section 515 of the Housing Act 1985, for subsections (2) and (3) (effect on grant of disposal by applicant of his interest in the property) substitute—

      "(2) Where an application for a grant is approved but before the certified date the applicant ceases to be a person entitled to apply for a grant of that description—

      (a) in the case of an improvement grant, intermediate grant, special grant or repairs grant, no grant shall be paid or, as the case may be, no further instalments shall be paid, and

      (b) in the case of a common parts grant, the local housing authority may refuse to pay the grant or any further instalment,

      505
      and the authority may demand that any instalment of the grant which has been paid be repaid forthwith, together with interest from the date on which it was paid until repayment at such reasonable rate as the authority may determine.

      (3) In subsection (2) 'the certified date' means the date certified by the local housing authority as the date on which the dwelling, house or, as the case may be, the common parts of the building, first become fit for occupation or use after the completion of the relevant works to the satisfaction of the authority.

      (4) For the purposes of subsection (2) an applicant ceases to be a person entitled to apply for a grant, other than a common parts grant, if he—

      (a) ceases to have an owner's interest in every parcel of land on which the relevant works are to be or have been carried out, or

      (b) ceases to be a tenant of the dwelling;

      and in this subsection 'owner's interest' and 'tenant' have the same meaning as in section 463(1)(a) and (b).

      (5) For the purposes of subsection (2) an applicant ceases to be a person entitled to apply for a common parts grant if he—

      (a) ceases to have a duty to carry out the relevant works, or

      (b) ceases to have power to carry them out or to have a qualifying interest in the building or in a dwelling in the building;

      and in this subsection 'qualifying interest' has the same meaning as in section 464A(1)(b).".

      12. In section 518 of the Housing Act 1985 (meaning of "dwelling for a disabled occupant" and related expressions), for subsection (3) substitute—
      "(3) In this Part 'improvement'—

      (a) in relation to a dwelling for a disabled occupant, includes the doing of works required for making the dwelling suitable for his accommodation, welfare or employment, and

      (b) in relation to the common parts of a building which includes such a dwelling, includes the doing of works required for making the common parts suitable for use by a disabled occupant of a dwelling.".

      13. Renumber section 519 of the Housing Act 1985 (meaning of "reasonable repair") as subsection (1) of that section and after it insert—
      "(2) In determining what is reasonable repair' in relation to the common parts of a building, a local housing authority shall have regard to—

      (a) the age and character of the building and the locality in which it is situated, and

      (b) the character of the dwellings in the building and the period during which they are likely to be available for use as dwellings,

      and shall disregard the state of internal decorative repair of the building and the dwellings in it.".
      14. In Section 526 of the Housing Act 1985 (the index to Part XV) at the appropriate places insert—
      "common parts (for the pur- section 498A(2)(b)" poses of common parts grant)
      "common parts grant sections 460 and 498A"
      "flat (for the purposes of section 498A(2)(a)", common parts grant).'
      Amendment No. 29, in clause 10, page 26, line 9, at end insert—
      '(da) the recovery of service charges in respect of the cost of grant-aided works'.
      Amendment No. 31, in page 83, line 14 [Schedule 2], at end insert—

      SERVICE CHARGES IN RESPECT OF THE COST OF GRANT-AIDED WORKS
      4(A).—(1) In the Landlord and Tenant Act 1985, after section 20 insert—

      Limitation of service charges: grant-aided works
      20A. Where relevant costs are incurred or to be incurred on the carrying out of works in respect of which a grant has been or is to be paid under Part XV of the
      506
      Housing Act 1985 (grants for works of improvement, repair or conversion), the amount of the grant shall be deducted from the costs and the amount of the service charge payable shall be reduced accordingly.".
      (2) In section 21 of the Landlord and Tenant Act 1985 (request for summary of relevant costs), in subsection (5) (contents of summary) after "shall" insert "state whether any of the costs relate to works in respect of which a grant has been or is to be paid under Part XV of the Housing Act (grants for works of improvement, repair or conversion) and".
      (3) In section 47 of the Housing Act 1985 (limitation on service charges payable after disposal of house by pubic sector authority), after subsection (3) add—
      "(4) Where relevant costs are incurred or to be incurred on the carrying out of works in respect of which a grant has been or is to be paid under Part XV (grants for works of improvement, repair or conversion), the amount of the grant shall be deducted from the costs and the amount of the service charge payable shall be reduced accordingly.".
      (4) In section 48 of the Housing Act 1985 (request for summary of relevant costs), after subsection (3) (contents of summary) insert—
      "(3A) The summary shall also state whether any of the costs relate to works in respect of which a grant has been or is to be paid under Part XV (grants for works of improvement, repair or conversion".'.
      Amendment No. 148, in clause 38, page 75, tine 31, after '3', insert '4A,'.
      Amendment No. 150, in line 37, after '4', insert '(Grants for improvement or repair of common parts)'.
      Amendment No. 151, in line 37, after '1', insert '(Common parts grants)'.
      Amendment No. 152, in line 38 [Clause 38], after '3', insert '4A,'.
      Mr. Jones: I do not suppose that I am alone in the House—and I see on the Amendment Paper a new clause from the Opposition on this matter—in receiving complaints from constituents and local authorities about what appears to be a gap in the housing renovation system. The complaints concern the common parts of flats and houses divided into fiats.
      At present, the system provides for two requirements. The first is that a proof of ownership must be provided, and the second provides for a certificate that the application for grant should relate to a property which can be occupied or is capable of letting. That is not the case with common parts, except in the rare cases where those parts are owned singly or in conjunction with a neighbouring fiat.
      As I have said, there is no real problem in relation to individual flats. Both landlord and tenant can fill the two requirements that I have mentioned. The legal difficulty arises in relation to the common parts which cannot be lived in. That is not a satisfactory state of affairs. I have therefore tabled the new clause and the concomitant amendments. The objective of the new clause is fairly simple, but hon. Members will have noticed that the methodology is more complicated than I would have wished.
      I set out to produce a simpler version and to try to amend the present scheme. However, the most obvious way of doing that, after considering the complexity of the legislation, was to create a new type of grant—a common parts grant which would be discretionary for local authorities. As I have said, it may seem over-elaborate, but I think that that is the best way of dealing with it.
      There are a number of differences between the proposed new grant and existing grants. Two particular aspects of the grant distinguish it from present grants—the works for which the grant may be made and those eligible to

      507
      apply. In this context "common parts" includes the structure, exterior, common areas and common facilities in a building divided into flats. Although the main problems arise with blocks of flats, these proposals will also apply to converted houses and flats in other buildings.
      The grant will be available to the person who is under an obligation to carry out the works. In most cases that will be the landlord. There may, however, be other cases where no one is under an obligation to carry out essential works of repair, perhaps because leases are defective, as we considered in an earlier amendment. In the case of improvements it is unlikely that anyone would be under an obligation to carry them out. In this situation, any person who has the power to carry out works will be eligible for grant provided that he has an interest in the block or in a flat in the block, whether as a long leaseholder, tenant, landlord, management association, and so on.
      It might be helpful to hon. Members if I outline other ways in which the new grant will differ from existing grants. Certificates of future occupation will not be required. Instead, I propose that grant should not be available if more than one quarter of the flats in a building are vacant at the time of application. This is an arbitrary figure but it is designed to provide a safeguard against someone making a profit from the improvement of a substantially vacant block by selling the flats as soon as work has been finished.
      Common parts grant would not be available if the average rateable value of the dwellings in a building exceeds a specified limit. This is to avoid the Chelsea problem. The limit will be for my right hon. Friend the Secretary of State for the Environment to determine, as is the case with other renovation grants, and I have no doubt that he will adopt the same principle so that the rateable value limits will be aimed at making the new grant available to those people and properties in the greatest need.
      It will have been noted by hon. Members that I have also tabled consequential amendments to section 47 of the Housing Act 1985 and to the Landlord and Tenant Act 1985. These are the provisions which were formerly in schedule 19 to the Housing Act 1980. They provide that, folllowing payment of a common parts grant, the amount of service charge payable will be reduced by the amount of the grant. This is to avoid tenants being caned a second time. In addition, similar provision is made for existing house renovation grants.
      This is a limited series of measures, which will not apply to a large number of grants, at least to start with, but they will do a great deal to plug a serious gap in the present system which has deterred local authorities which are determined to improve blocks of flats in their areas but have not been able to do so because of the quirks in the present law. Therefore, I commend my new clause to the House.
      Mr. John Fraser: May I speak to the associated Opposition amendment? The law on improvement grants for blocks of flats and maisonettes has turned out to be plain daft. There have been a number of cases where substantial grants could be given for alterations, repairs or improvements to individual flats and yet where necessary work on a roof which gave protection to more than one flat requiring a modest amount of money, as a result of rulings
      508
      by the Department of the Environment and the interpretation of the law could not be undertaken. That has led to the most acute distress. A case is proceeding at the moment between the owners of a block of flats in my constituency and the Department of the Environment. I am not sure whether it has yet been concluded but it has caused the most acute distress and the law needs to be remedied quickly.
      The Minister gave us an undertaking in Committee when we raised this issue that the Government would address themselves to it. I do not know whether they have in any way inspired the hon. Member for Hertfordshire, West (Mr. Jones). If they have, we welcome the inspiration and we hope that the Government will be able to accept the amendment, with which we are happy to associate ourselves.
      Mr. Simon Hughes: I should like to join that association in views. There is a clear gap in the law. Home improvement grants have failed to help many people who live in accommodation that is effectively shared, or the common parts of which are shared. If the Minister does not respond now by saying that the Government accept the amendments as drafted, I hope that something will be introduced in another place because this is an appropriate Act in which to do something. The new clause put forward by the hon. Member for Hertfordshire, West (Mr. Jones) is more or less appropriate and is certainly sufficiently correct in principle to be adapted by the Department of the Environment within a short time.
      Clearly here is an area where property has often been more neglected and so there is more substantial need for moneys for home improvement than in many of the other areas to which money has been directed so far. There is a gap in the law and it appears that there is many-sided agreement on this. I look forward to a positive response.
      8.15 pm
      Mr. Alfred Dubs: This is another respect in which leaseholders are suffering and there can be no doubt that there is a major defect in the law. Over the past few months I have had a number of bitter and angry letters from people in my constituency who have not been allowed an improvement grant. It is clear that even the Conservative Wandsworth council has blamed the Minister for a decision which has given rise to this difficulty.
      I was given this undertaking by the Under-Secretary of State, the hon. Member for Ealing, Acton (Sir G. Young), in April:
      "We are, however, currently considering the possibility of an amendment in the Housing and Planning Bill now before Parliament, to remedy the situation."
      Therefore, I hope that the new clause tabled by the hon. Member for Hertfordshire, West (Mr. Jones) is Government-inspired and is the way in which the Government, in a slightly roundabout way, are seeking to meet that commitment.
      This is an urgent problem. Some of the people who have been held up in their application for an improvement grant are suffering from damp, leaking roofs and so on. There is not a moment to waste in implementing this measure. If the Minister accepts this series of amendments, as I assume he will, will he give an undertaking as to when the provision will come into effect so that those who are waiting will know how much longer they will have to wait?
      Mr. John Patten: I am well aware of the consequences, particularly in London, of the home improvement grant legislation. There is a gap in the law which has been recognised by my hon. Friend the Member for Hertfordshire, West (Mr. Jones), the hon. Member for Southwark and Bermondsey (Mr. Hughes) and the Labour Front Bench spokesmen. Indeed, in Committee, the hon. Member for Norwood (Mr. Fraser) raised this important point. That is why I am grateful to my hon. Friend for tabling new clause 12 and the consequential amendments which will remove the anomaly in the Housing Act 1985 by enabling grants to be given for works to the common parts of buildings including flats.
      The hon. Member for Battersea (Mr. Dubs) mentioned Wandsworth. Indeed, one of the people who has pressed powerfully on the Government the case for this change in the law has been that excellent Conservative leader in Wandsworth, Councillor Paul Beresford. I am sure that he will welcome this news this evening. I also welcome the proposed consequential amendment on service charges. It is important to ensure—
      Mr. Rooker: Come on.
      Mr. Patten: Everyone is allowed a couple of minutes during a bipartisan evening.
      It is important to ensure that leaseholders who pay variable service charges will be able to benefit from this new grant. Here again, it is a duty on me to say that I applaud the excellent decision reached by the excellent chairman of the housing committee of Westminster city council, Councillor Patricia Kirwan, to enter into a voluntary agreement with private landlords on a new code to regulate private lettings in the city of Westminster. We are fortunate to have people such as Councillors Beresford and Kirwan in local government.
      Mr. Rooker: What about Dick Knowles?
      Mr. Patten: I would certainly associate Councillor Dick Knowles with my remarks about the need to have good leaders in local government in all political parties. He is always wonderfully rude to me in the friendliest sort of way whenever I meet him.
      I have little to add to what my hon. Friend has said about his new clause and the consequential amendments. He put the case for this urgently needed change clearly and I am extremely happy to accept, lock stock and barrel, his new clause and the amendments. In saying that, it means that new clause 16 cannot be accepted because it is not drafted in a way that makes it acceptable to the Government. Of course, it has an identical intention, and I recognise the issue raised by the hon. Member for Norwood in Committee. I am extremely grateful to my hon. Friend the Member for Hertfordhsire, West.
      Mr. Dubs: When will it come into effect?
      Mr. Patten: I forgot to deal with that point. It will come into effect when the Bill becomes law.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.
      New schedule agreed to.
      —[Mr. Robert Jones.]
      Mr. John Patten: I beg to move Government amendment No. 4, in page 2, line 6, leave out from 'flat,' to end of line 15 and insert
      '44 per cent. plus two per cent. for each complete year by which the qualifying period exceeds two years, up to a maximum of 70 per cent. '.
      Mr. Deputy Speaker: With this it will be convenient to discuss amendment No. 5, in page 3, line 7, at end insert
      '(5)(a) In the case of a flat to which subsection (2)(b) applies the District Valuer shall on the application of a person exercising the right to buy to determine the value of the flat in whose block there has been no transfer for value of fewer than three flats in that block (other than a transfer for value on the exercise of the right to buy) give formal notice to the landlord requesting the landlord to offer for sale, with vacant possession a similar flat in the same block

      (b) on receipt of such formal notice the landlord shall do his utmost to comply with the notice and shall notify the Secretary of State in writing of the steps which he proposes to take to comply with the notice within three weeks of the receipt thereof.

      (c) The landlord shall notify the District Valuer of a sale and the price at which the sale was made within seven days of the exchange of contracts for that sale.

      (d) in determining the value of the flat the District Valuer shall take full account of any price notified to him under subsection (c).'

      Mr. Pattie: Clause 1 of the Bill, as amended in Committee, provides for a three-tier system of discount on houses and flats sold under the right to buy. The effect of clause 1 as it stands is that for houses the scale would start at 32 per cent. for tenants with the minimum two years, and rise to a maximum of 60 per cent. by steps of l per cent. for each of the tenant's qualifying years in excess of two. For flats, in general, the scale would run, as the Bill sets out in its original form, from 42 per cent. by l per cent. steps to 70 per cent. This was the proposal in the Bill as introduced.
      The amendment tabled in Committee by my hon. Friends the Members for Northampton, North (Mr. Marlow) and Aldridge-Brownhills (Mr. Shepherd) made special provision for flats in deck access blocks and tower blocks with 10 or more floors. Under their amendment the scale for such flats would start at 50 per cent. and rise by 1 per cent. steps to a maximum of 80 per cent.
      When we debated that amendment in Committee I suggested that a special discount scale for certain categories of flats could have unfortunate effects. I do not wish to repeat that in detail and I am sure that hon. Members are well aware of my views. However, I recognise my hon. Friends' strength of feeling in Committee that we ought to go beyond the simple 10 per cent. increase in discount on flats for which the Bill, as introduced, provided.
      The amendment does that, but it avoids the complication of three different discount scales by providing for better discounts on flats of any kind sold under the right to buy. This is the Government's response to the painful defeat I experienced in Standing Committee by an all-party group on an amendment put down by my hon. Friend the Member for Northampton, North.
      It is a dreadful experience to be defeated in Committee. One gets into terrible trouble with the Whips and derision is poured onto one's head by colleagues. I realised I had to claw back as best I could. What I have done in this amendment is to provide for a flat tenant's discount to rise by 2 per cent. steps. Therefore, a tenant with a minimum of two years' standing—necessary to exercise the right to buy—would be entitled to a discount of 44 per cent. and a maximum of 70 per cent. would be reached after only 15 years.
      I will give a moment of detail on this as it is important. I am advised that this provision would give much the same average discount as tenants of flats in deck access and

      511
      tower blocks would have received if my hon. Friend's amendment were enacted in its present form—about 65 per cent. Under my proposal, however, all the tenants of flats, not just tenants of flats in the categories annunciated by my hon. Friend's amendment in Committee, would benefit. Under my hon. Friend's proposal, less than about half of flat tenants would have been eligible for the higher discount. I hope that this change, together with other provisions in the Bill, will encourage tenants to think seriously about buying.
      Mr. Hughes: The other statistic which would be helpful to know would be the difference that this would make to the revenue of local authorities as against the present position and as against the position as it would be on the basis of the original drafted clause. On the present rate of sales it would be helpful to know what the difference will be. One of the key factors is not the effect on people's right to buy but the effect on the revenue accounts of the local authorities who have one property less.
      Mr. Patten: That is a perfectly proper question, but unfortunately I cannot answer it properly or even give an improper answer drafted by my civil servants. The civil servants are very good at drafting improper answers when asked.
      We cannot predict what the effect of this legislation will be on flat sales—so far, the number of flat sales have been extremely small. Only 2 or 3 per cent. of all sales through the right to buy have been flat sales. Sales have been extremely restricted. Thus, we cannot predict the impact of an increase of 10 per cent. discount or the effect of shortening from 30 years to 15 years the period during which the maximum can accrue will have on people's behaviour.
      I hope it will encourage people to think seriously about buying their flats. However, we do not know if it will. I cannot say, therefore, without going into the funniest arithmetic of all, what the effects will be on local government finance. The fact that only 3 per cent. of right to buy purchasers have been for flats means that, at the present, the effect on revenue has been minimal. I cannot give a straight answer. I have not satisfied the hon. Gentleman, but I have owned up to the fact that I cannot give a straight answer.
      Mr. Hughes: I am grateful for the Minister's answer. Although there may be statistics, I understand his problem. Is his Department proposing to compensate local authorities for any increased sales which they suffer as a result of this legislation becoming law?
      Mr. Patten: I do not like the use of "suffer" in this context. The position will remain exactly as it is with the right to buy.
      I now turn to amendment No. 5 tabled by my hon. Friend the Member for Eastbourne (Mr. Gow) whom I disappointed so much in the last debate but one. We debated this issue in Committee on 8 April and I had the feeling that I was indirectly addressing my hon. Friend even though he was not a Committee member. I had an uneasy prickle that somewhere behind me was the figure of my hon. Friend and that his hand might descend on my collar at any time.
      512
      In Committee, my hon. Friend the Member for Northampton, North tabled a new clause to give effect to the proposal of my hon. Friend the Member for Eastbourne. We had a good debate in Committee and I think my hon. Friend the Member for Eastbourne had a chance to study that particular debate. I have not got much to add to what I said in that debate. There are some practical difficulties.
      My hon. Friend's scheme is certainly ingenious, but I fear that practical difficulties remain to be resolved. I am not suggesting that the practical problems are insoluble. However, before adding such novel, complex and costly procedures to the statute book we have to be sure that the scale of the problem justifies a move of this kind. There is no clear evidence to suggest that it does. I am in a position to pay tribute to my hon. Friend the Member for Eastbourne for the role he played when he was Minister for Housing, Urban Affairs and Construction. He set up, with the co-operation of the London boroughs of Ealing and Wandsworth—I am afraid I must mention Wandsworth again as that was the other co-operative body—a study to consider the effects of the sort of situation which my hon. Friend imagined.
      The results offered no support for the view that the valuation set on flats by borough valuers or district valuers are excessive. I set out the exact facts and figures in my answer in Committee to the new clause put down by my hon. Friend the Member for Northampton, North. We are continuing to monitor the sale and resale of flats in these areas under the scheme set up by my hon. Friend the Member for Eastbourne. So far we have not received a shred of evidence about over-valuation. I agree that this sample is not very large. There was no evidence to show that a scheme of the kind proposed by my hon. Friend was necessary.
      I hope that my hon. Friend will consider withdrawing his amendment.
      Mr. Gow: I welcome the provision of extra discount for those who buy flats, and I congratulate my successor on that part of the Bill that is before us. What is now section 128 of the Housing Act 1985 provides that
      "any question … as to the value of a dwelling-house … shall be determined by the district valuer".
      The purpose of my amendment is to give further protection to the purchaser of a flat. I wish to move from the particular to the general.
      8.30 pm
      On 5 April there came to the office in Eastbourne a constituent who is considering exercising the right to buy. The house that he is minded to buy is one to which the Housing Defects Act 1984 applies. It is a prefabricated, reinforced concrete house. Quite understandably, my constituent was dissatisfied with the value placed upon that house by the Eastbourne borough council. He had previously been to see his Member of Parliament, who agreed with him that the valuation placed on the house by the borough council was too high. My constituent therefore applied, as he is entitled to do under the Housing Act 1980, to the district valuer for a determination of the value.
      On 28 February 1986 the district valuer wrote to my constituent in the following terms:
      "Reference is made to the Notice served on the Eastbourne Borough Council requiring my determination of the value of the

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      above property in accordance with the provisions of Section 11 of the Housing Act 1980. The property was inspected on 16 January 1986."
      I note in passing that the inspection was carried out on 16 January 1986 but that the letter was not written until 28 February 1986. The district valuer then said:
      "Representations, either verbal and/or written, from the landlord and the tenant have been considered together with all relevant valuations and available market evidence."
      Those are the words that I want to underline to the House and in particular to my hon. Friend the Minister for Housing. The district valuer said that representations, together with all relevant valuations and available market evidence, had been considered. You may find it immensely surprising, Mr. Deputy Speaker—as I do—since this is a prefabricated, reinforced concrete house, that the district valuer then said:
      "No structural survey has been made."
      Following my constituent's visit on 5 April, I wrote to the district valuer on 8 April and said:
      "In the sixth paragraph of your Determination you say that you have considered 'all relevant valuations and available market evidence.' So that I may advise my Constituent, could you please make available to me those 'relevant valuations and available market evidence' which you considered? Why did you make no structural survey of this property?"
      It was not the district valuer who replied to my letter of 8 April. On the contrary, the reply came from the assistant chief valuer, land services and taxation division of the Inland Revenue— a valuer, no doubt, of great distinction. He said:
      "In view of my earlier correspondence with you, the District Valuer at Eastbourne has forwarded me a copy of your letter to him dated 8 April. It would not be appropriate for him"—
      that is, the district valuer—
      "to give the information which you now request. The DV has made his statutory determination using his professional knowledge and taking into account all relevant matters of which he was aware … I regret that I consider further discussion of any individual cases subsequent to a determination would serve no useful purpose."
      But what was it for which I asked? I asked for the evidence upon which he had based his judgment and for all relevant valuations and available market evidence. I also asked him why there had been no structural survey of the property.
      What will be the position of those who are considering purchasing a flat? That was a house. There are not many examples of prefabricated, reinforced concrete houses changing hands between one purchaser and another, both of whom are in the private sector, because it is virtually impossible, as the Opposition know, to get a mortgage. As the hon. Members for Birmingham, Perry Barr (Mr. Rooker) and for Norwood (Mr. Fraser) know, the number of approved methods of repair is not very great. If that was the reply that was given in respect of a prefabricated, reinforced concrete house by the district valuer, where there was little evidence of the open market value, how much more difficult would it be to establish the value of a flat in a block of flats where no other sales had taken place?
      I am second to none in my admiration for the professional skill and expertise of district valuers, but we are asking them under the 1980 Act, reproduced in the 1985 Act, particularly in the case of flats—however estimable, highly qualified and devoted they may be—to do something which even the wisest man cannot do. Even the hon. Members for Perry Barr and for Norwood, and even the hon. Member for Bootle (Mr. Roberts), were
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      he here, could not say, however wise they may be, what would be the market value of the first flat on the 15th floor that was about to be sold.
      The only way to give real assistance to the district valuer in his task is to try to sell one of those flats on the open market. If one asked the finest estate agents—there may be a number of estate agents on the Opposition Benches to whom we could give this task—to try to find a purchaser, then we should know the open market value of that flat.
      The purpose of the amendment is to provide protection for those who wish to purchase a flat. The value that is frequently placed upon a flat—here I respectfully disagree with my hon. Friend the Minister for Housing—means that prospective tenants do not buy. Of course my hon. Friend is right to say that there is no evidence. The reason for the lack of evidence is that few deck access flats have been sold. One cannot say that the valuations of deck access flats are proper valuations, because when a prospective purchaser is told what the open market value is he says, "I'm not going to go ahead at that value." That is why there is no evidence.
      Before he had heard my modest contribution to this debate, my hon. Friend said that he was unable to accept the amendment. Having heard what I have said, I hope that he may be able to accept it, or that, if he is unable to accept it this evening his noble Friend, who is to pilot the Bill through another place, will look again at this matter. It is not good enough to say that there is no evidence. The evidence is there in this dramatic way. Part of the reason for my hon. Friend's introduction of extra discounts for flats was that such a tiny number of flats had been sold. Why had such a tiny number of flats been sold? It was because either the district council, or the borough council, or the district valuer, had placed a value upon the flat that the tenant knew was nowhere near the price that he would be able to obtain on a resale.
      Mr. Simon Hughes: Will the hon. Gentleman give way?
      Mr. Gow: No. I think that I detect the mood of the House. It is anxious to make progress. I have said enough to explain my case.
      Mr. Cartwright: The formulation in the Government amendment leaves the Bill in a tidier state than it had reached in Committee. It is a great deal better to have only two ranges of discount instead of three. The argument for having a greater discount for the purchase of flats and maisonettes is that they are less attractive propositions and there are far more associated problems. I am glad that the Minister was a little cautious in the way in which he presented his amendment. He clearly did not necessarily suggest that these discounts would result in a great flow of purchases.
      Like many of us he understands that many other problems are involved. Practical difficulties are associated with buying a flat or maisonette, and there are problems of service and maintenance charges. To be fair, the Government have tried to deal with those matters in other clauses. Problems are associated with the general environment of the block and the unattractiveness of some council flats and maisonettes. A problem follows from the resale of housing of the general quality of which we are

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      talking. All these matters will have a much bigger impact than discount on whether more flats and maisonettes are sold.
      I underline what the hon. Member for Eastbourne (Mr. Gow) has said. In constituencies such as mine and that of my hon. Friend the Member for Southwark and Bermondsey (Mr. Hughes), there is no evidence at all of the sale of flats of any sort, public or private. If we consider a flat in a singularly rundown council estate, whether it is in a tower block on a deck access block or is a maisonette in a high-density development, there is no evidence at all to enable us to decide what is a reasonable market value for that property, given not just the square footage or facilities it contains but the general area in which it is situated, its surrounding environment, and all the features that go to make up the package that someone will buy.
      On the basis of that kind of experience, some of my constituents who have been brave enough—some would say foolhardy enough—to buy flats in such an area may have paid more than it was reasonable to expect them to pay. Thus the case made out by the hon. Member for Eastbourne is very good. I hope that the Minister will consider the possibility suggested, because it is important that we try to discover what is a reasonable price in an open market for some of the properties we expect tenants to buy.
      Mr. Marlow: I thank the Minister for the gracious, graceful and highly intelligent way in which he has introduced his amendment. I also find very persuasive the amendment introduced by the Member for Eastbourne (Mr. Gower). He will not be surprised by my saying that, because I put forward a similar amendment in Committee, inspired by my hon. Friend the Member for Eastbourne.
      There is a great justification for having a higher discount on flats than applies to houses. First, as has been said by at least two hon. Members, we have not sold many flats. Secondly, not many flats have been sold because when a house is purchased there is an unavoidable annual commitment to pay the mortgage. However, when a flat is purchased there is the unavoidable annual commitment of paying the mortgage, the insurance, the cost of keeping a roof on the block of flats, and the service charges, so if there is a higher percentage discount on the sale of a flat. The actual percentage that has to be paid as unavoidable annual commitment is probably much the same for a flat as it would be for a house. That is why the amendment is justified.
      Discussions have taken place since the first amendment was passed by the Committee. There were difficulties about how much money would be involved, but we are delighted that the Treasury has come up trumps. The amendment now extends the legislation a much greater range of flats; it was restricted before. It also provides that while a person who has been in residence in a flat for between two and eight years does not receive quite as big a discount as under the previous provision. A person who has been in residence for between eight and 15 years actually gets a bigger discount. It is quite often a person in that category who is better able to buy the property. Thus the probability is that, under this amendment, more people in the deck access and tower block type of flats will buy their flats. In addition, a whole other raft of tenants will be encouraged to buy flats at a higher rate of discount.
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      The whole proposal is very exciting. It provides a wonderful opportunity for many people to purchase the homes in which they have been living, and it can have a great effect on improving the environment in which so many of our citizens now live.
      8.45 pm
      Mr. Simon Hughes: I want to raise two points, the first relating to the change in discount rules and the other relating to the amendment of the hon. Member for Eastbourne (Mr. Gow). In an intervention this afternoon, I asked the Minister a question because of the concern which I have and which Liberal and alliance-run councils and many other councils have—that, with every change in the rules adding to discounts, whether for houses or flats, there is no compensation back to the local authorities for what in effect they lose in terms of housing stock.
      What is involved may indeed be the least desirable accommodation. If we accept the entitlement of people to claim the right to buy and if there is difficulty, as the Government have found, in encouraging people to buy flats in tower blocks, then the Government pretend their policy is more effective by giving greater and greater incentives. If the increase as a result of this policy is not much beyond 4 per cent., the Government will probably give away flats in tower blocks in order to show what a successful policy they have. That is certainly where this policy leads; I have no doubt that such a measure will be introduced if the percentage increase remains low. The problem for the local authorities remains the same. Those with the largest number of flats in constituencies and boroughs such as Southwark and the largest number of flats that are difficult to rent have the greatest problem in accommodating people in decent housing.
      Since I first came into the House and subsequently, I have expressed my concern and scepticism about the present legislation. With each change the Government have made to the law, I believe they have added to the discounts without adding at all to the compensation for local authorities. My colleagues and I certainly will not be happy until the Government compensate by adding the money into the housing revenues of local authorities that they have been taking away in larger and larger proportions. I shall be interested to see what the figures produce. I urge the Minister to do something much more substantial for the housing needs of those who are not housed at all or who do not have decent accommodation rather than increasing to privatise blocks or parts of blocks of flats.
      I support amendment No. 5 in principle. I appreciate the ridiculous conclusion the hon. Member for Eastbourne arrived at in his proper inquiries which clearly led him to the alley from which he is seeking to escape in his amendment. However, a matter of some technicality is involved in the question of the first occupant to exercise the right to buy in the block when there is no other empty property at all, but where it is still possible, given the wording of the amendment, for a valuation to be carried out properly. I appreciate that one can value as though a flat were vacant even when it is occupied, but I fear that there may still be a technical difficulty with the amendment. If that difficulty can be resolved and there are ways of getting a proper valuation, not only should that happen but the valuations should be in the public domain. I hope that the Revenue and the other people involved will respond to the concern expressed in this debate, giving

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      proper information when Members of the House or other people seek it and not hiding behind matters of technicality and obscurity.
      Mr. Rooker: The rubbish spoken by people outside after the Committee completed considering clause 1 only showed their ignorance in not even bothering to read the details of our proceedings. We had extensive debates on the difficulty of living in flats, whether deck access or tower block, not all of which are hard to let. There was a substantial difficulty with an imprecise Opposition amendment dealt with at the first sitting of the Committee, but I made it absolutely clear that the Opposition would not act in that way, with a simple alteration of the discount. We still believe that people will not buy what they cannot sell. That is the real issue, although, as my hon. Friend the Member for Norwood (Mr. Fraser) said, there are council blocks of flats on the Edgware road which have been sold piecemeal. with two-bedroom flats on the 16th floor selling at more than £50,000. Of course, London is always different from the rest of the country.
      As I said on Second Reading, the Government could make the discount 90 per cent., and there would still be a problem. People would not be able to do what they wanted. The issue can be tackled in other ways, not just by piecemeal selling. However, we concur with the Government's approach to clause 1 because, technically, the clause is now meaningless in terms of its operation.
      The hon. Member for Eastbourne (Mr. Gow) identified the difficulty of valuing a property on the open market. I appreciate the fact that district valuers face difficulties, in carrying out structural surveys of homes which are probably designated under the Housing Defects Act 1984. The problem affects many tens, if not hundreds, of thousands of our fellow citizens.
      We do not want to hinder progress on this part of the Bill or, indeed, progress on the Bill as a whole, until we become party political shortly. The Government have tried to solve this problem of their defeat on clause 1. They were defeated because hon. Members on both sides of the House searched, blindly, for another way. They did not want simply to jack up discounts piecemeal. They wanted to improve housing for people living in flats, whether they rented or wanted to exercise the right to buy.
      Mr. John Patten: I welcome the comments of the hon. Member for Birmingham, Perry Barr (Mr. Rooker). Some people did not understand the nature of the debate on clause 1. Anyone interested in it should read the debate in Standing Committee.
      I am pleased that Government amendment No. 4 has been welcomed. I am particlarly pleased at the welcome given to it by my hon. Friend the Member for Northampton, North (Mr Marlow). To use his immortal words. "The Treasury has come up trumps." I shall pass on his comments to my right hon. Friend the Chief Secretary to the Treasury who sits with his little calculator in the Treasury looking for opportunities to add things up and, from time to time, to come up trumps. On this occasion, my right hon. Friend has certainly come up trumps, and we are grateful to him.
      I made much in Standing Committee of the fact that we do not have any evidence. Lo and behold, from behind me came evidence that I did not have before of a particular problem. I was disturbed by what my hon. Friend the Member for Eastbourne (Mr. Gow) said. I was disturbed
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      at the disgraceful delays in answering correspondence by the Liberal-controlled Eastbourne council on behalf of his constituents. Councils—whether Conservative, Labour or, as in this case, Liberal—should get on with the job of answering letters and looking after the people who live in their areas.
      Mr. Simon Hughes: Not the council. It was the district valuer who delayed.
      Mr. Patten: The hon. Gentleman should have listened more carefully to the comments of my hon. Friend the Member for Eastbourne. There were delays in answering letters from the council before the district valuer became involved.
      Mr. Simon Hughes rose—
      Mr. Patten: The hon. Gentleman can read the account in Hansard.
      I make no promises to my hon. Friend the Member for Eastbourne, but he has given me pause for thought. If he can spare the time to send me the evidence to which he referred, I shall consider further with my noble Friend the Minister of State whether we should make changes in the other place. That is not a pledge to do something in the other place. It is a pledge to look seriously at the evidence of my hon. Friend the Member for Eastbourne.
      Amendment agreed to.

    Schedule 1

      LAND REGISTRATION AND RELATED MATTERS WHERE RIGHT TO BUY PRESERVED
      Amendment made: No. 6, in page 79, line 8, at end insert
      'and accordingly section 70(1)(k) of that Act (leases which are overriding interests) does not apply.'.—[Mr. John Patren.]

    Clause 5

      REDEVELOPMENT OF DWELLING-HOUSE SUBJECT TO SECURE TENANCY
      Mr. Rooker: I beg to move amendment No. 7, in page 18, line 3, leave out clause 5.
      Mr. Deputy Speaker: With this it will be convenient to take the following amendments: No. 10, in page 18, line 14, at end insert
      'and for that purpose reasonably requires possession and occupation of the dwelling-house'.
      No. 11, in page 18, line 14, at end insert
      'provided that possession is not required for the purposes of refurbishment and subsequent sale or re-letting to another person.'.
      No. 12, in page 18, line 20, after 'dwelling house' insert
      'provided that possession is not required for the purposes of refurbishment and subsequent sale or re-letting to another person'.
      No. 13, in page 18, line 25, at beginning insert 'subject to sub-paragraph 4'.
      No. 14, in page 18, leave out lines 38 to 41 and insert—
      '(3) The Secretary of State shall, in giving his approval, consider:

      (a) whether the tenants in an area which is the subject of a disposal and re-development scheme have been fully consulted about the proposals;

      (b) the views expressed by tenants in an area which is the subject of disposal and redevelopment;

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      (c) the likely effect of the disposal of the whole or part of one or more dwelling-houses on an adjacent property;

      (d) whether the proposed disposal and redevelopment will lead to a substantial loss of accommodation and;

      (e) whether the tenants in an area which is the subject of disposal and redevelopment will have an opportunity of renting one of the developed dwellings at a fair rent or buying at an appropriate price. '.

      No. 15, in page 18, line 41, at end insert—
      '(4) A landlord may apply to the Secretary of State for consent for the disposal and redevelopment of an area of land consisting of or including the whole or part of one or more dwelling-houses only if

      (a) a majority of two-thirds of the tenants of the dwelling-houses have agreed in writing to the proposed scheme, following a consultation period of not less than three months from the point at which full details of the proposed redevelopment have been made available on an individual basis to the tenants concerned; and

      (b) the local authority is satisfied that the disposal of the dwelling-houses will not affect its ability to carry out its duties under section 22 of the Housing Act 1985; and

      (c) the consideration obtained by the local authority for the disposal of the land would in the opinion of the local authority be more than the vacant site value of the land.'.

      Government Amendment No. 16. No. 23, in page 20, line 27, at end add—
      '(5) In Part IV of the Housing Act 1985, section 105(3) after the word "demolition" insert "or disposal for redevelopment" and in section 105(3) after the word "situated" add—
      "or (c) a proposal to consider the disposal and redevelopment of dwelling-houses let under secure tenancies".'
      Mr. Rooker: This is the one central clause to which we take fundamental objection. I do not intend to delay the House because I made the case on Second Reading. In Committee, the Opposition refused even to countenance amending clause 5. I spoke for the best part of nearly two hours, and apologised for doing so, giving the arguments why clause 5 should not remain in the Bill. We failed in our task. We tabled modest amendments earlier in the week and since then have tabled and withdrawn others. For the convenience of the House we thought that it was best to have one debate on clause 5 so that hon. Members would have an opportunity to debate the principle of the clause. We are grateful to Mr. Speaker for selecting amendment No. 7 because that will ease our debate.
      The clause will give back to 6 million council tenants one-sided tenancy agreements. It will allow the landlords to kick those tenants out simply because they want to get in the home to do it up and sell it off to someone else. When one strips away all the verbiage, that is what the clause is all about. It is about kicking council tenants out—not so that the home can be demolished to remodel the estate or to create access to the land for new building or because the home is substandard, but so that the home can be done up and sold off to someone else. That is immoral. That is not the housing policy we expect from a British Government in the 1980s.
      We are not interested in amending clause 5. Essentially, we want it to be deleted. We cannot understand why the Government are not prepared to accept some of our amendments. The provisions in amendments Nos. 10 to 15 would ameliorate some conditions. One Minister said last November on "TV Eye" that the Government were proposing a residual power and that one person should not stand in the way of a development.
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      During the debate, we gave the example—I repeat it because no one else should be able to argue that we have kept our light under a bushel—of the Labour-controlled Langbaurgh council carrying out this type of measure with 177 dwellings. Three tenants—there were eviction notices on two—were sticking it out because they loved their homes and did not want to move. Under existing law, they may, or may not, have failed in the courts, but, under this legislation, the council would have walked in immediately. The argument was that those homes would remain and were not required for remodelling. The council changed its mind during the passage of the Bill. I take no credit for that. The credit is due to the campaign waged by the three families concerned to show the council that there were other ways of carrying out housing policy.
      Clause 5 requires something that can be tested in the courts, so that it is a matter not just of the view of the Secretary of State, but of a test of reasonableness. That is implied in amendment No. 10. At least there would be a further test of what the Government are up to.
      Under amendment No. 11, the clause would not operate after rehabilitation if the dwellings concerned were resold to other people.
      Amendment No. 14 relates to tenant consultation—as does amendment No. 15—if by a majority of two thirds the tenants have agreed in writing to the proposed scheme. In this way there is some kind of veto for the tenants. I imagine the Minister will come to the House with good news in some respects on clauses 4 and 6. The Minister made concessions in Committee which he confirmed to me in writing today, saying that in another place substantial concessions will be made on clauses 4 and 6. For that, on behalf of the Opposition, I am very grateful, as I know tenants and my hon. Friends will be.
      If the Minister can meet us in that way on clauses 4 and 6, why can he not meet us similarly on clause 5 in regard to amendments Nos. 14 and 16? Before 1980 council tenants had no security of tenure. This Tory Government gave tenants security of tenure. If clause 5 is retained in the Bill, it will remove that security of tenure for a wholly spurious and immoral reason. If such homes are to remain, tenants should have the choice to remain in them.
      This is the one clause on which I give the firm pledge that, if it stays in the Bill, it will be removed by a Labour Government because we will have no use for it.
      9 pm
      Mr. Peter Thurnham: I wish to refer to one small point in connection with amendment No. 16, which says:
      " 1B.—(1) In considering whether to give his approval to a scheme or variation the Secretary of State shall take into account, in particular—

      (a) the effect of the scheme on the extent and character of housing accommodation in the neighbourhood,

      (b) over what period of time it is proposed that the disposal and redevelopment will take place in accordance with the scheme, and

      (c) to what extent the scheme includes provision for housing provided under the scheme to be sold or let to existing tenants or persons nominated by the landlord"

      Will my hon. Friend, when considering whether to give his approval, comment on the extent to which there might be a defective title? I think that our hon. Friend the other Parliamentary Under-Secretary of State for the Environment touched on this yesterday when he commented that the Government had not ruled out further action. Can my hon. Friend comment on whether he thinks

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      that further legislation might be needed in this respect or whether there might be an amendment in another place to take account of the possibility of a defective title?
      This has been the subject of correspondence for nearly a year between me and the Department of the Environment. It started on 29 April last year in connection with my constituents Mr. and Mrs. Stallard of 1 Charnock Drive, Bolton. Correspondence has been exchanged about those constituents and a number of other constituents who are in a similar predicament. Bolton council, it appears, is unique among councils in having so many defective titles and doing so little about them. I shall be grateful, therefore, if my hon. Friend will say whether he thinks that new legislation might be needed, or whether an amendment in another place might take care of the matter.
      Mr. Cartwright: I do not wish to rehearse all the arguments that occurred in Standing Committee, but I am still not persuaded that the clause is necessary. I continue to believe that local authorities have a lot of experience of the slow process of voluntarily decanting people when dealing with this kind of problem. It involves a great deal of time, effort and energy, but surely that is the way to go about the problem when, as the hon. Member for Northampton, North (Mr. Marlow) reminded us in Committee, we are discussing taking people's homes away from them.
      My fear, and I think the fear of other hon. Members, is that if this power is given to local authorities to back up what may be a voluntary process to begin with they might be tempted to short-circuit the voluntary process and have early recourse to any legal powers that they may be given. Although the Minister tried to persuade us in Committee that there would be legal protection for tenants, and that tenants who were not happy with the alternative housing would have the protection of the courts, that does not adequately cover the problem of tenants who will suddenly be thrust into the frightening process of appearing in the courts and arguing the issues.
      The clause will in a sense play into the hands of the Bill's oponents. Earlier this week the Minister talked about the scare stories which are circulating on council estates about the impact of the clause. That is the price that he will have to pay if he sticks to this approach. So long as this power is left in the Bill, such stories will be told. That is a tragedy, because there are many useful provisions in the legislation. Unfortunately, they will be swept away in the reaction to the shorthand headline approach that will flow from the inclusion of clause 5.
      The Minister has gone some way to try to meet the points about consultation and about giving tenants real power. Amendment No. 16 is barely a form of consultation. Certainly it gives no power to tenants who want to express their view on the possibility of losing their homes. I endorse everything that the hon. Member for Birmingham, Perry Barr (Mr. Rooker) has said. If we must have clause 5, we must ask that alongside it there is real and genuine protection for tenants to ensure that such power cannot be exercised against the will of the majority of the people involved.
      Mr. Raynsford: The clause is objectionable. It removes security of tenure, effectively to facilitate privatisation. In my constituency the Fulham Court estate is subject to exactly this process at the moment. That example illustrates the position that will be created if the clause is put into effect.
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      Fulham Court is an estate of about 370 dwellings. It was built in the 1930s. It was attractive and popular at the time, but it has been allowed to fall into decay. I do not wish to make a party point about it. I suspect that both parties which have controlled Hammersmith and Fulham council have in their own ways neglected the estate. The tragedy is that, rather than accept the need to try to put things right and to look after the interests of the tenants, whose needs have been neglected for many years, the current council—a Conservative council held in power by Liberals, an interesting combination—has, in a Pontius Pilate-like style, washed its hands of Fulham Court and decided to sell the estate.
      The council started with a process of consultation with the tenants. This is an interesting example of the value of the consultation proposed by the Government. Consultation took place. The council said that it was considering selling to non-profit making bodies. That was the basis of the consultation. The response of the tenants was clear and unequivocal. They did not want disposal of their homes; they wanted the council to live up to its responsibilities and improve the estate for them. A large majority of the tenants said that they did not want the estate to be disposed of.
      The council disregarded the wishes of the tenants and proceeded with a proposal to dispose of the estate. It gave priority to decanting people from the estate into available lettings in the authority. As a result, many other people who are in extreme need have not been given housing to which they should have had access. Recently I have been giving advice to tenants who are statutorily overcrowded and who have been advised by the authority that it cannot house them. It is a sad comment on the attitude of an authority when it gives priority to decanting people to enable privatisation to take place, rather than meeting the needs of the people who are statutorily overcrowded.
      The estate was gradually vacated, but only one block was vacated in total. With the local authority elections pending, the Conservative councillors suspected that they would lose control of the council and sought to pre-empt any decision by a future council to take a different course of action. The council sought to impose on the sale of that one vacant block a covenant which would require a future council to dispose of the rest of the estate by sale. That covenant was rejected by the housing association. I must declare an interest, because at the time I was a member of the committee of the housing association which had previously wished to buy one block on the estate for shared ownership. The association would not proceed on those discreditable terms.
      Did the local authority pay attention? No, it did not. The response by the local authority was to say that it would try to sell and dispose of the properties to private developers. The council has agreed to dispose of the estate, not to a non-profit-making body, which was the basis of the consultation, but to Barratts, a company which is most emphatically profit-making. I should add that during a period over two years ago when Barratts was rather over-committed to timber framed housing, it was not making as much profit as it would have liked. In principle, Barratts is not a non-profit-making body.
      That is a measure of the value of consultation by a Conservative-controlled council seeking to privatise. The councillors have demonstrated their contempt for the tenants of Fulham Court. The council has ignored the wishes of the tenants, who did not want the estate to be

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      privatised. It has shown a gross breach of faith by changing the basis of the sale from a sale to a non-profit-making body to one to a profit-making company, and it has shown a contempt for the democratic process by attempting to bind the hands of a future council to proceed with sales.
      Throughout this period the estate has been allowed to go to rack and ruin, and more and more properties have been left empty. It rings pretty hollow to hear the Minister talk about empty properties when we hear about a council which is deliberately leaving 200 houses empty. That represents more than the number of homeless families in Hammersmith and Fulham who are presently living in bed-and-breakfast accommodation. Those houses are being left empty while the council pursues its objective of sale for privatisation.
      One of the tenants has been able to get redress by seeking a judicial review in the High Court and obtaining an injunction to restrain the council from proceeding with the sale in the meantime. If this clause had been in effect, that remedy would not have been available and the tenants of Fulham Court not only would have had their wishes ignored, but would have been evicted. The clause will do nothing to help people who need houses. It will exacerbate the sort of problems that I have described and will open the door to exploitation of tenants. I urge hon. Members to reject the clause.
      Mr. Simon Hughes: Political retribution of a type came my way during the by-election for the Fulham constituency at which the hon. Gentleman was the victor. I went along incognito, as it were, to ask what I could do to help. I was given a load of leaflets to deliver and, as it happens, I was asked to distribute them in the Fulham Court estate. I had some dealings with my colleagues on the local council about that estate and know all about it. I went round the estate on a sunny and pleasant afternoon not long before the by-election took place.
      My comments are as strong as those that have been made by my hon. Friend the Member for Woolwich (Mr. Cartwright). The clause is the worst part of the Bill, and if the Government want the Bill to have a favourable reception outside they have no option but to remove it. The clause takes away protection for tenants. We made that point on Second Reading. As the hon. Member for Fulham (Mr. Raynsford) has said, the consultation process is never adequate unless it gives power to people. The problem with consultation is that it always retains power for local authorities. As the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said, if this power is given to local authorities it will override the right of security of tenure given by the Government to tenants in council property. I give all credit to the Government for giving tenants that right. In this case and in others—Langbaurgh and Tower Hamlets are other examples—that right is under threat.
      If ever an experience was destined to make one firm in one's view that the clause ought to be resisted, it was the experience that I had when I went to Fulham Court estate and to many similar estates in my constituency and found that the community feeling was so strong that people were determined not to give in with any degree of willingness. They deserve to be supported in their right not to give in. I understand that the procedures followed by the local
      524
      council meant ultimately that the proposal, as it was before the application for the judicial review, was that there would be a sale of only those blocks which by then had been vacated and that the rest were not to be sold. Therefore, the picture was not as black as was sometimes painted by the hon. Member for Fulham and his colleagues. None the less, an issue of principle was raised, and there was criticism of Members of this House, both Labour and Conservative.
      I beseech the Minister to say that his amendment is not sufficient to recognise the strength of feeling and the strength of view expressed by my hon. Friend the Member for Woolwich and by myself, reinforcing what was said by the hon. Member for Perry Barr, speaking for the Labour party. We would be committed to removing the clause if it went into the legislation, and I hope to persuade the Minister that to legislate in this way, albeit for a short period, might be misleading to those who would be affected and harmful to the rights of people to stay in their homes if they wish to do so.
      9.15 pm
      Mr. John Patten: I regret that this must be my longest speech this evening. This is an important issue and it is important that I set it out clearly.
      Can I begin by dealing with the important issue of Bolton. My hon. Friend from Bolton North-East, (Mr. Thurnham) with his characteristic energy and ingenuity, was able to put Bolton into this debate and I think he is right to raise it. In Bolton, as elsewhere in the country, the problems which he raises in respect of the amendment, which he has admirably drafted, are complex and raise difficult technical issues relating to the rights of third parties, and I do not regard this Bill as a suitable vehicle for pursuing the point further.
      I hope what my hon. Friend the Member for Ealing, Acton (Sir G. Young) said yesterday, in answer to questions, will satisfy my hon. Friend the Member for Bolton, North-East (Mr. Thurnham) and my right hon. and learned Friend the Member for Southport (Sir I. Percival) this evening, because there is a strong feeling in the Committee that we must make progress on the main elements in this particular debate.
      We are looking seriously at this issue, but I do not think that I can conceivably make any amendments during the progress of this Bill, although I do deplore the way in which Bolton council is delaying so seriously people's rightful aspirations to exercise their right to buy.
      Sir Ian Percival: This is a difficult question. I am glad that my hon. Friend has accepted that it is an important one. Could he not go a little further? So far, he has ruled out the possibility of dealing with this in the course of this Bill in the other place. I would ask him to leave it open, because I doubt whether it is as complicated as some people think. I did have something to do with it when I was a Law Officer, and I would ask him to undertake to look at the formula in clause 13 before the other House parts with it.
      Mr. Patten: Who am I to resist the blandishments of my right hon. and learned Friend? I am not going to give an undertaking to him or my hon. Friend to do anything in another place. If they wish to write to me further and in greater detail about this point, I will consider it further. But for the avoidance of doubt, that is not an undertaking

      525
      to do something in another place but is an undertaking to look at the possibilities of doing something in another place. With that I hope we can leave the important issues of Bolton. What a political cockpit Bolton is. When I go to Bolton I get scragged by the local council—a very rough lot. I mean Labour Members on the local council.
      So far as the main element of this debate is concerned, I understand the strength of feeling of the hon. Gentleman for Birmingham, Perry Barr (Mr. Rooker) on this issue, and I listened to him for two hours upstairs in Committee in a long and powerful speech. I think that clause 5 has been wrongly misrepresented as a wholesale attack on the security of tenure and I think that it is bizarre in the extreme to suggest that it is such. It is nothing of the kind. Its purpose is to remove certain anomalies in the powers of local authorities, and other public sector landlords, to improve their housing stock. That is how I prefer to see it, and that is what I think the reality of the situation is.
      At the moment private landlords can obtain possession of their property when they can provide suitable alternative accommodation under present powers.
      Councils can also do so because public sector landlords of secure tenants can already seek possession of their dwellings on the grounds that they wish to redevelop the property. There are, therefore, two clear precedents for what is made possible in clause 5. The only situation in which it is not possible to do it is when property is being transferred from public to private ownership—which is not always a bad or an evil thing.
      Under present legislation, landlords can also make home loss payments to long-standing tenants who move within the public sector, but they cannot make those home loss payments when there is a transfer disposal from the public to the private sector, and that inability to make home loss payments has been a major obstacle to a number of local authorities, both Labour and Tory, in their attempts to bring dilapidated stock into better condition.
      The hon. Member for Perry Barr referred to the "TV Eye" programme last November on which my hon. Friend the Member for Ealing, Acton appeared. As my hon. Friend then said, these anomalies could, on a very limited number of occasions, hinder councils that wished to bring private sector funds into the refurbishment of run-down estates.
      What happened in Langbaurgh was very unfortunate. The Opposition know my views about that; I made them quite clear in Committee. It was wrong that a single tenant could block a desirable scheme which, after due consideration, all the other tenants wanted. There must be a balance between security of tenure and the possession of one's home, and the benefit of the greater number of people who wish for a change.
      In Standing Committee, after some debate, I was persuaded that the factors that the Secretary of State should take into consideration in deciding whether to give approval for a scheme should be spelt out in the Bill. Persuasive arguments were deployed by the hon. Member for Woolwich (Mr. Cartwright) and by Labour Members. I had already announced some of the issues that I envisaged would be taken into account, but I think that they must be stated in the Bill. Amendment No. 16 is therefore designed to spell out the factors to be taken into account. Opposition Members will wish to be assured that the scheme must be a viable one which will result in the improvement of housing. The Secretary of State will ensure that that is so. He will make sure that the tenants
      526
      have been properly consulted. I have already stated that I would consider giving tenants a statutory right of individual consultations on proposals for which the new ground is to be used. Landlords will have to take tenants' views into account before seeking the approval of the Secretary of State.
      This speech must necessarily be rather long, because of the sensitivity of the issues.
      Hon. Members who expressed concern about individual consultations will be pleased to see that the amendment will give tenants that right. I am glad to see that organisations such as Age Concern have given what they call a cautious welcome to the additional safeguards in amendment No. 16.
      I expect that only a very few cases relying on the proposed new ground will come to court, but only the court can grant a possession order. It is important that that should be clear. It is unfair and wrong to say that clause 5 introduces the right for councils to kick tenants out at will. That is not true.
      Mr. Raynsford rose—
      Mr. Patten: I shall not give way to the hon. Gentleman.
      The court will need to be satisfied that the re-development scheme has the Secretary of State's approval, that the scheme will proceed reasonably quickly, and that suitable alternative accommodation can be found. I shall put on record what I have put in writing to the hon. Member for Perry Barr. I refer to the two amendments that I am unable to move this evening. We shall move them in the other place, and the amendments to clauses 4 and 6 will give effect to the veto that the hon. Gentleman desires. I am happy to give that undertaking, and I shall place a copy of my letter to him in the Library. I sense that it is not the wish of the House to hear it read out word for word.
      In conclusion—[HON. MEMBERS: "Hear, hear."] It is always good to be praised by one's own side for one's phrases. But the provisions introduced by the clause will assist public-sector landlords in tackling their rundown estates for the general improvement of the housing stock, while at the same time providing adequate safeguards for tenants. It is perfectly fair for the Labour party, Social Democratic party or Liberal party to campaign against. the Bill, to campaign in particular against clause 5 or to inform tenants that they think that the clause is wrong, is against their interests and may do them damage. But I ask them not to scaremonger in their party political propaganda and to give the impression that clause 5 allows the "turfing out" of tenants at will. That is completely and utterly wrong. Any propaganda to that effect is a straightforward lie, and it will be put right by me and my fellow Ministers whenever we have the opportunity.
      The Opposition amendments would leave the anomalies that I have described unchanged, and would mean that the opportunity was missed to make a minor change that would help local authorities in their difficult task. I reject their amendments. I wish to strengthen the safeguards for tenants as requested by both sides of the Committee, and am happy to commend amendment No. 16.
      Mr. Rooker: The Opposition never said that clause 5 would allow councils to kick out tenants at will. But I make no bones about it: the clause gives councils the right to remove tenants from their homes solely for the purpose

      527
      of doing them up and selling them off. That is the long and the short of it. If the clause remains in the Bill, 5 million or 6 million families will be unsure whether they can sleep easily in their beds, not knowing whether their council will go in for a scheme that could force them out of their homes.
      I have been in the home of a tenant who wanted to stay there. The home was perfectly OK. Somebody knocked on that tenant's door and said, "Why are you still living here? This home is going to be mine. On the plot in the estate agent's office on the site, your plot number, your home, is going to be mine." Imagine how someone feels when that happens, yet that happened in Langbaurgh. It could be repeated up and down the country if the clause remains in the Bill. I do not blame the Minister for saying that he did not want to read out the whole of his letter. We are extremely grateful to the Minister for his concession in relation to clauses 4 and 6. But he said:
      "You will see that this arrangement will give tenants an effective right of veto where the majority are opposed to a disposal of tenanted property or to a management agreement."
      That is what we asked for, and we are extremely grateful. But why cannot the tenants have the same sort of veto in relation to clause 5?
      9.30 pm
      We are not opposed to private money being spent to do up rundown estates where there are vast numbers of empty council flats. We have made that clear. We are not opposed to tenants being persuaded of offered something better to move into to facilitate such development. We are not opposed to tenants being moved from their homes under existing law where estates are being remodelled to provide decent roads, proper gardens and proper front paths.
      We are opposed to tenants being moved out simply so that their home can be done up and sold off. It is that central point that we are opposed to, none of the others. That is something that the Government's amendment and the Minister's speech do not seem to meet.
      Mr. John Patten: I am grateful for the hon. Gentleman's assurance that the Opposition do not think that the bringing of private funds into the public sector is a bad thing. Would the hon. Gentleman undertake—as much as it is possible for him to control his support as it is for us to control our supporters—to do everything he can to prevent Labour party literature containing allegations that clause 5 makes large-scale evictions possible and makes it possible for tenants to be turfed out of their homes. That literature is being circulated in London at present in the local government campaigns. It is doing much harm and stirring up many unnecessary fears in people's minds.
      Mr. Rooker: I do not think that the Minister appreciates the problem. The majority of clauses in the Bill would be accepted by every hon. Member because they are not related to the contentious parts of housing or planning. I am not talking about the Bill. We object to clause 5. I do not have any control—I do not think that anybody in the House does—over what our individual candidates say or do. All I seek to do is tell the truth.
      I have sought to explain what is wrong with clause 5. I have sought to explain what we have tried to do to amend it and I have also tried to show what can
      528
      happen if clause 5 stays in the Bill as it is now. I make no bones about it. I have used Langbaurgh as an example. It is a good example, because it shows the naked reality of clause 5 and how the security of tenancy is under threat.
      I do not want to repeat what I have said. My constituents are not subject to that at the moment and neither, perhaps, are my hon. Friends. However, there is no political monopoly in seeking to kick tenants out of their homes. It has happened under Labour-controlled councils as well. I do not want council tenants to be removed from the homes they wish to stay in simply so that the homes can be done up and sold off to somebody else. I do not think that any of my hon. Friends do either.
      We want this clause removed from the Bill. In the absence of that, at the very minimum, we want something like that contained in amendment 15 put into the Bill to strengthen the operation of the clause.
      Question put, That the amendment be made:—
      The House divided: Ayes 140, Noes 184.

      Division No. 155]

      [9.32 pm

      AYES

      Adams, Allen (Paisley N)

      Fields, T. (L'pool Broad Gn)

      Alton, David

      Fisher, Mark

      Anderson, Donald

      Foot, Rt Hon Michael

      Archer, Rt Hon Peter

      Forrester, John

      Ashley, Rt Hon Jack

      Foster, Derek

      Atkinson, N. (Tottenham)

      Foulkes, George

      Barnett, Guy

      Fraser, J. (Norwood)

      Barren, Kevin

      George, Bruce

      Beckett, Mrs Margaret

      Gilbert, Rt Hon Dr John

      Bell, Stuart

      Godman, Dr Norman

      Benn, Rt Hon Tony

      Golding, John

      Bermingham, Gerald

      Hancock, Michael

      Bidwell, Sydney

      Harman, Ms Harriet

      Blair, Anthony

      Harrison, Rt Hon Walter

      Boothroyd, Miss Betty

      Hart, Rt Hon Dame Judith

      Boyes, Roland

      Haynes, Frank

      Bray, Dr Jeremy

      Heffer, Eric S.

      Brown, Gordon (D'f'mline E)

      Holland, Stuart (Vauxhall)

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

      Home Robertson, John

      Brown, Ron (E'burgh, Leith)

      Howells, Geraint

      Bruce, Malcolm

      Hoyle, Douglas

      Buchan, Norman

      Hughes, Robert (Aberdeen N)

      Caborn, Richard

      Hughes, Roy (Newport East)

      Callaghan, Jim (Heyw'd & M)

      Hughes, Simon (Southwark)

      Campbell-Savours, Dale

      John, Brynmor

      Carlile, Alexander (Montg'y)

      Kaufman, Rt Hon Gerald

      Cartwright, John

      Kirkwood, Archy

      Clarke, Thomas

      Leadbitter, Ted

      Clay, Robert

      Leighton, Ronald

      Clelland, David Gordon

      Litherland, Robert

      Clwyd, Mrs Ann

      Lloyd, Tony (Stretford)

      Cocks, Rt Hon M. (Bristol S)

      Lofthouse, Geoffrey

      Cook, Frank (Stockton North)

      McDonald, Dr Oonagh

      Corbett, Robin

      MacKenzie, Rt Hon Gregor

      Corbyn, Jeremy

      McTaggart, Robert

      Crowther, Stan

      Madden, Max

      Davies, Rt Hon Denzil (L'lli)

      Marek, Dr John

      Davies, Ronald (Caerphilly)

      Martin, Michael

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

      Mason, Rt Hon Roy

      Deakins, Eric

      Maxton, John

      Dixon, Donald

      Maynard, Miss Joan

      Dobson, Frank

      Meacher, Michael

      Dormand, Jack

      Meadowcroft, Michael

      Dubs, Alfred

      Michie, William

      Duffy, A. E. P.

      Mikardo, Ian

      Dunwoody, Hon Mrs G.

      Millan, Rt Hon Bruce

      Eadie, Alex

      Morris, Rt Hon A. (W'shawe)

      Eastham, Ken

      Nellist, David

      Ewing, Harry

      Oakes, Rt Hon Gordon

      Faulds, Andrew

      O'Brien, William

      Field, Frank (Birkenhead)

      O'Neill, Martin

      529

      Park, George

      Silkin, Rt Hon J.

      Pendry, Tom

      Skinner, Dennis

      Pike, Peter

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

      Powell, Raymond (Ogmore)

      Soley, Clive

      Radice, Giles

      Straw, Jack

      Randall, Stuart

      Thomas, Dafydd (Merioneth)

      Raynsford, Nick

      Thomas, Dr R. (Carmarthen)

      Redmond, Martin

      Tinn, James

      Richardson, Ms Jo

      Torney, Tom

      Roberts, Allan (Bootle)

      Wallace, James

      Roberts, Ernest (Hackney N)

      Wardell, Gareth (Gower)

      Robertson, George

      Wareing, Robert

      Robinson, G. (Coventry NW)

      Weetch, Ken

      Rooker, J. W.

      Wigley, Dafydd

      Ross, Ernest (Dundee W)

      Williams, Rt Hon A.

      Rowlands, Ted

      Winnick, David

      Sedgemore, Brian

      Young, David (Bolton SE)

      Sheerman, Barry

      Sheldon, Rt Hon R.

      Tellers for the Ayes:

      Shore, Rt Hon Peter

      Mr. Norman Hogg and

      Short, Ms Clare (Ladywood)

      Mr. Andrew MacKay.

      Question accordingly negatived.
      Mr. Deputy Speaker: I understand that the hon. Member for Birmingham, Perry Barr (Mr. Rooker) would like a Division on amendment No. 15.
      Mr. Rooker: Yes.
      Amendment No. 15 proposed, in page 18, line 41, [Clause 5], at end insert—
      '(4) A landlord may apply to the Secretary of State for consent for the disposal and redevelopment of an area of land consisting of or including the whole or part of one or more dwelling-houses only if

      (a) a majority of two-thirds of the tenants of the dwelling-houses have agreed in writing to the proposed scheme, following a consultation period of not less than three months from the point at which full details of the proposed redevelopment have been made available on an individual basis to the tenants concerned; and

      (b) the local authority is satisfied that the disposal of the dwelling-houses will not affect its ability to carry out its duties under section 22 of the Housing Act 1985; and

      (c) the consideration obtained by the local authority for the disposal of the land would in the opinion of the local authority be more than the vacant site value of the land.'.—[Mr. Rooker.]

      Question put, That the amendment be made:—
      The House divided: Ayes 95, Noes 185.

      Division No. 155]

      [9.32 pm

      AYES

      Adams, Allen (Paisley N)

      Fields, T. (L'pool Broad Gn)

      Alton, David

      Fisher, Mark

      Anderson, Donald

      Foot, Rt Hon Michael

      Archer, Rt Hon Peter

      Forrester, John

      Ashley, Rt Hon Jack

      Foster, Derek

      Atkinson, N. (Tottenham)

      Foulkes, George

      Barnett, Guy

      Fraser, J. (Norwood)

      Barren, Kevin

      George, Bruce

      Beckett, Mrs Margaret

      Gilbert, Rt Hon Dr John

      Bell, Stuart

      Godman, Dr Norman

      Benn, Rt Hon Tony

      Golding, John

      Bermingham, Gerald

      Hancock, Michael

      Bidwell, Sydney

      Harman, Ms Harriet

      Blair, Anthony

      Harrison, Rt Hon Walter

      Boothroyd, Miss Betty

      Hart, Rt Hon Dame Judith

      Boyes, Roland

      Haynes, Frank

      Bray, Dr Jeremy

      Heffer, Eric S.

      Brown, Gordon (D'f'mline E)

      Holland, Stuart (Vauxhall)

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

      Home Robertson, John

      Brown, Ron (E'burgh, Leith)

      Howells, Geraint

      Bruce, Malcolm

      Hoyle, Douglas

      Buchan, Norman

      Hughes, Robert (Aberdeen N)

      Caborn, Richard

      Hughes, Roy (Newport East)

      Callaghan, Jim (Heyw'd & M)

      Hughes, Simon (Southwark)

      Campbell-Savours, Dale

      John, Brynmor

      Carlile, Alexander (Montg'y)

      Kaufman, Rt Hon Gerald

      Cartwright, John

      Kirkwood, Archy

      Clarke, Thomas

      Leadbitter, Ted

      Clay, Robert

      Leighton, Ronald

      Clelland, David Gordon

      Litherland, Robert

      Clwyd, Mrs Ann

      Lloyd, Tony (Stretford)

      Cocks, Rt Hon M. (Bristol S)

      Lofthouse, Geoffrey

      Cook, Frank (Stockton North)

      McDonald, Dr Oonagh

      Corbett, Robin

      MacKenzie, Rt Hon Gregor

      Corbyn, Jeremy

      McTaggart, Robert

      Crowther, Stan

      Madden, Max

      Davies, Rt Hon Denzil (L'lli)

      Marek, Dr John

      Davies, Ronald (Caerphilly)

      Martin, Michael

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

      Mason, Rt Hon Roy

      Deakins, Eric

      Maxton, John

      Dixon, Donald

      Maynard, Miss Joan

      Dobson, Frank

      Meacher, Michael

      Dormand, Jack

      Meadowcroft, Michael

      Dubs, Alfred

      Michie, William

      Duffy, A. E. P.

      Mikardo, Ian

      Dunwoody, Hon Mrs G.

      Millan, Rt Hon Bruce

      Eadie, Alex

      Morris, Rt Hon A. (W'shawe)

      Eastham, Ken

      Nellist, David

      Ewing, Harry

      Oakes, Rt Hon Gordon

      Faulds, Andrew

      O'Brien, William

      Field, Frank (Birkenhead)

      O'Neill, Martin

      529

      Park, George

      Silkin, Rt Hon J.

      Pendry, Tom

      Skinner, Dennis

      Pike, Peter

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

      Powell, Raymond (Ogmore)

      Soley, Clive

      Radice, Giles

      Straw, Jack

      Randall, Stuart

      Thomas, Dafydd (Merioneth)

      Raynsford, Nick

      Thomas, Dr R. (Carmarthen)

      Redmond, Martin

      Tinn, James

      Richardson, Ms Jo

      Torney, Tom

      Roberts, Allan (Bootle)

      Wallace, James

      Roberts, Ernest (Hackney N)

      Wardell, Gareth (Gower)

      Robertson, George

      Wareing, Robert

      Robinson, G. (Coventry NW)

      Weetch, Ken

      Rooker, J. W.

      Wigley, Dafydd

      Ross, Ernest (Dundee W)

      Williams, Rt Hon A.

      Rowlands, Ted

      Winnick, David

      Sedgemore, Brian

      Young, David (Bolton SE)

      Sheerman, Barry

      Sheldon, Rt Hon R.

      Tellers for the Ayes:

      Shore, Rt Hon Peter

      Mr. Norman Hogg and

      Short, Ms Clare (Ladywood)

      Mr. Andrew MacKay.

      NOES

      Adley, Robert

      Heddle, John

      Aitken, Jonathan

      Hickmet, Richard

      Ancram, Michael

      Hogg, Hon Douglas (Gr'th'm)

      Atkins, Robert (South Ribble)

      Hordern, Sir Peter

      Baker, Nicholas (Dorset N)

      Howard, Michael

      Benyon, William

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

      Biggs-Davison, Sir John

      Howarth, Gerald (Cannock)

      Boscawen, Hon Robert

      Howell, Ralph (Norfolk, N)

      Bowden, Gerald (Dulwich)

      Hubbard-Miles, Peter

      Brandon-Bravo, Martin

      Hunt, John (Ravensbourne)

      Brown, M. (Brigg & Cl'thpes)

      Hunter, Andrew

      Burt, Alistair

      Irving, Charles

      Butterfill, John

      Jackson, Robert

      Cash, William

      Johnson Smith, Sir Geoffrey

      Chapman, Sydney

      Jones, Robert (Herts W)

      Clark, Dr Michael (Rochford)

      King, Roger (B'ham N'field)

      Clarke, Rt Hon K. (Rushcliffe)

      King, Rt Hon Tom

      Clegg, Sir Walter

      Knight, Greg (Derby N)

      Conway, Derek

      Knight, Dame Jill (Edgbaston)

      Coombs, Simon

      Knowles, Michael

      Cope, John

      Knox, David

      Couchman, James

      Lamont, Norman

      Currie, Mrs Edwina

      Lang, Ian

      Dickens, Geoffrey

      Lawler, Geoffrey

      Durant, Tony

      Leigh, Edward (Gainsbor'gh)

      Dykes, Hugh

      Lennox-Boyd, Hon Mark

      Evennett, David

      Lewis, Sir Kenneth (Stamf'd)

      Fallon, Michael

      Lilley, Peter

      Favell, Anthony

      Lloyd, Ian (Havant)

      Fletcher, Alexander

      Lord, Michael

      Forman, Nigel

      McCrindle, Robert

      Forsyth, Michael (Stirling)

      McCurley, Mrs Anna

      Forth, Eric

      MacKay, Andrew (Berkshire)

      Fowler, Rt Hon Norman

      Maclean, David John

      Fraser, Peter (Angus East)

      McNair-Wilson, M. (N'bury)

      Freeman, Roger

      McNair-Wilson, P. (New F'st)

      Fry, Peter

      Major, John

      Gale, Roger

      Malins, Humfrey

      Gardiner, George (Reigate)

      Marlow, Antony

      Garel-Jones, Tristan

      Mather, Carol

      Goodlad, Alastair

      Maude, Hon Francis

      Gow, Ian

      Mellor, David

      Greenway, Harry

      Merchant, Piers

      Gregory, Conal

      Meyer, Sir Anthony

      Griffiths, Sir Eldon

      Mills, Iain (Meriden)

      Griffiths, Peter (Portsm'th N)

      Moate, Roger

      Ground, Patrick

      Montgomery, Sir Fergus

      Grylls, Michael

      Morrison, Hon C. (Devizes)

      Hamilton, Hon A. (Epsom)

      Moynihan, Hon C.

      Hamilton, Neil (Tatton)

      Mudd, David

      Hanley, Jeremy

      Neale, Gerrard

      Hargreaves, Kenneth

      Nelson, Anthony

      Harris, David

      Newton, Tony

      Haselhurst, Alan

      Nicholls, Patrick

      Hayhoe, Rt Hon Barney

      Norris, Steven

      Hayward, Robert

      Onslow, Cranley

      Heathcoat-Amory, David

      Oppenheim, Phillip

      530

      Oppenheim, Rt Hon Mrs S.

      Stern, Michael

      Osborn, Sir John

      Stevens, Lewis (Nuneaton)

      Ottaway, Richard

      Stradling Thomas, Sir John

      Page, Richard (Herts SW)

      Sumberg, David

      Parkinson, Rt Hon Cecil

      Taylor, Teddy (S'end E)

      Patten, J. (Oxf W & Abgdn)

      Temple-Morris, Peter

      Pawsey, James

      Thompson, Donald (Calder V)

      Peacock, Mrs Elizabeth

      Thompson, Patrick (N'ich N)

      Pollock, Alexander

      Thorne, Neil (Ilford S)

      Portillo, Michael

      Thornton, Malcolm

      Powell, William (Corby)

      Thurnham, Peter

      Powley, John

      Townsend, Cyril D. (B' heath)

      Prentice, Rt Hon Reg

      Tracey, Richard

      Price, Sir David

      Trippier, David

      Proctor, K. Harvey

      Twinn, Dr Ian

      Raffan, Keith

      Vaughan, Sir Gerard

      Rhys Williams, Sir Brandon

      Viggers, Peter

      Ridley, Rt Hon Nicholas

      Waddington, David

      Ridsdale, Sir Julian

      Walden, George

      Roe, Mrs Marion

      Walker, Bill (T'side N)

      Rossi, Sir Hugh

      Waller, Gary

      Rowe, Andrew

      Wardle, C. (Bexhill)

      Ryder, Richard

      Warren, Kenneth

      Sainsbury, Hon Timothy

      Watson, John

      Sayeed, Jonathan

      Watts, John

      Shaw, Giles (Pudsey)

      Wheeler, John

      Shaw, Sir Michael (Scarb')

      Whitney, Raymond

      Shelton, William (Streatham)

      Winterton, Mrs Ann

      Shepherd, Richard (Aldridge)

      Wood, Timothy

      Shersby, Michael

      Yeo, Tim

      Sims, Roger

      Young, Sir George (Acton)

      Spencer, Derek

      Younger, Rt Hon George

      Spicer, Michael (S Worcs)

      Squire, Robin

      Tellers for the Noes:

      Stanbrook, Ivor

      Mr. Michael Neubert and

      Stanley, Rt Hon John

      Mr. Gerald Malone

      Steen, Anthony

      Division No. 156]

      [9.44 pm

      AYES

      Adams, Allen (Paisley N)

      Boyes, Roland

      Alton, David

      Bray, Dr Jeremy

      Atkinson, N. (Tottenham)

      Brown, Gordon (D'f'mline E)

      Barron, Kevin

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

      Bell, Stuart

      Buchan, Norman

      Bermingham, Gerald

      Callaghan, Jim (Heyw'd & M)

      Bidwell, Sydney

      Campbell-Savours, Dale

      531

      Carlile, Alexander (Montg'y)

      MacKenzie, Rt Hon Gregor

      Cartwright, John

      McNamara, Kevin

      Clarke, Thomas

      Madden, Max

      Clay, Robert

      Maxton, John

      Clelland, David Gordon

      Maynard, Miss Joan

      Clwyd, Mrs Ann

      Meacher, Michael

      Cocks, Rt Hon M. (Bristol S)

      Meadowcroft, Michael

      Cook, Frank (Stockton North)

      Michie, William

      Corbett, Robin

      Mikardo, Ian

      Corbyn, Jeremy

      Millan, Rt Hon Bruce

      Crowther, Stan

      Morris, Rt Hon A. (W'shawe)

      Deakins, Eric

      Nellist, David

      Dormand, Jack

      Oakes, Rt Hon Gordon

      Dubs, Alfred

      O'Neill, Martin

      Dunwoody, Hon Mrs G.

      Park, George

      Eadie, Alex

      Pavitt, Laurie

      Eastham, Ken

      Pendry, Tom

      Ewing, Harry

      Penhaligon, David

      Faulds, Andrew

      Pike, Peter

      Field, Frank (Birkenhead)

      Raynsford, Nick

      Fisher, Mark

      Richardson, Ms Jo

      Foster, Derek

      Roberts, Allan (Bootle)

      Foulkes, George

      Robertson, George

      Fraser, J. (Norwood)

      Rooker, J. W.

      Godman, Dr Norman

      Ross, Ernest (Dundee W)

      Golding, John

      Ross, Stephen (Isle of Wight)

      Hancock, Michael

      Sedgemore, Brian

      Harman, Ms Harriet

      Sheerman, Barry

      Harrison, Rt Hon Walter

      Short, Ms Clare (Ladywood)

      Hart, Rt Hon Dame Judith

      Skinner, Dennis

      Heffer, Eric S.

      Soley, Clive

      Hogg, N. (C'nauld & Kilsyth)

      Thomas, Dafydd (Merioneth)

      Holland, Stuart (Vauxhall)

      Torney, Tom

      Howells, Geraint

      Wareing, Robert

      Hoyle, Douglas

      Weetch, Ken

      Hughes, Roy (Newport East)

      Wigley, Dafydd

      Hughes, Simon (Southwark)

      Winnick, David

      Kaufman, Rt Hon Gerald

      Young, David (Bolton SE)

      Kirkwood, Archy

      Leadbitter, Ted

      Tellers for the Ayes:

      Leighton, Ronald

      Mr. Ron Davies and

      Lloyd, Tony (Stretford)

      Mr. Allen McKay.

      McDonald, Dr Oonagh

      NOES

      Adley, Robert

      Fallon, Michael

      Aitken, Jonathan

      Favell, Anthony

      Ancram, Michael

      Fletcher, Alexander

      Atkins, Robert (South Ribble)

      Forman, Nigel

      Baker, Nicholas (Dorset N)

      Forsyth, Michael (Stirling)

      Benyon, William

      Forth, Eric

      Biggs-Davison, Sir John

      Fowler, Rt Hon Norman

      Boscawen, Hon Robert

      Fraser, Peter (Angus East)

      Bowden, Gerald (Dulwich)

      Freeman, Roger

      Brandon-Bravo, Martin

      Fry, Peter

      Brown, M. (Brigg & Cl'thpes)

      Gale, Roger

      Buck, Sir Antony

      Gardiner, George (Reigate)

      Burt, Alistair

      Garel-Jones, Tristan

      Butterfill, John

      Goodlad, Alastair

      Cash, William

      Gow, Ian

      Chapman, Sydney

      Greenway, Harry

      Clark, Dr Michael (Rochford)

      Gregory, Conal

      Clarke, Rt Hon K. (Rushcliffe)

      Griffiths, Sir Eldon

      Clegg, Sir Walter

      Griffiths, Peter (Portsm'th N)

      Conway, Derek

      Ground, Patrick

      Coombs, Simon

      Grylls, Michael

      Cope, John

      Hamilton, Hon A. (Epsom)

      Couchman, James

      Hanley, Jeremy

      Currie, Mrs Edwina

      Hargreaves, Kenneth

      Durant, Tony

      Harris, David

      Dykes, Hugh

      Haselhurst, Alan

      Evennett, David

      Hayes, J.

      532

      Hayhoe, Rt Hon Barney

      Percival, Rt Hon Sir Ian

      Hayward, Robert

      Pollock, Alexander

      Heathcoat-Amory, David

      Portillo, Michael

      Heddle, John

      Powell, William (Corby)

      Hickmet, Richard

      Powley, John

      Hogg, Hon Douglas (Gr'th'm)

      Prentice, Rt Hon Reg

      Hordern, Sir Peter

      Price, Sir David

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

      Proctor, K. Harvey

      Howarth, Gerald (Cannock)

      Raffan, Keith

      Howell, Ralph (Norfolk, N)

      Rhys Williams, Sir Brandon

      Hubbard-Miles, Peter

      Ridley, Rt Hon Nicholas

      Hunt, John (Ravensbourne)

      Ridsdale, Sir Julian

      Hunter, Andrew

      Roe, Mrs Marion

      Irving, Charles

      Rossi, Sir Hugh

      Jackson, Robert

      Rowe, Andrew

      Jenkin, Rt Hon Patrick

      Ryder, Richard

      Johnson Smith, Sir Geoffrey

      Sainsbury, Hon Timothy

      Jones, Robert (Herts W)

      Sayeed, Jonathan

      King, Roger (B'ham N'field)

      Shaw, Giles (Pudsey)

      King, Rt Hon Tom

      Shaw, Sir Michael (Scarb')

      Knight, Dame Jill (Edgbaston)

      Shelton, William (Streatham)

      Knowles, Michael

      Shepherd, Richard (Aldridge)

      Knox, David

      Shersby, Michael

      Lamont, Norman

      Sims, Roger

      Lang, Ian

      Spencer, Derek

      Lawler, Geoffrey

      Spicer, Michael (S Worcs)

      Leigh, Edward (Gainsbor'gh)

      Squire, Robin

      Lennox-Boyd, Hon Mark

      Stanbrook, Ivor

      Lewis, Sir Kenneth (Stamf'd)

      Stanley, Rt Hon John

      Lilley, Peter

      Steen, Anthony

      Lloyd, Ian (Havant)

      Stern, Michael

      Lord, Michael

      Stevens, Lewis (Nuneaton)

      McCrindle, Robert

      Stradling Thomas, Sir John

      McCurley, Mrs Anna

      Sumberg, David

      MacKay, Andrew (Berkshire)

      Taylor, Teddy (S'end E)

      Maclean, David John

      Temple-Morris, Peter

      McNair-Wilson, M. (N'bury)

      Thompson, Donald (Calder V)

      McNair-Wilson, P. (New F'st)

      Thompson, Patrick (N'ich N)

      Major, John

      Thorne, Neil (Ilford S)

      Malins, Humfrey

      Thornton, Malcolm

      Marlow, Antony

      Thurnham, Peter

      Mather, Carol

      Townsend, Cyril D. (B'heath)

      Mellor, David

      Tracey, Richard

      Merchant, Piers

      Trippier, David

      Meyer, Sir Anthony

      Twinn, Dr Ian

      Mills, Iain (Meriden)

      Vaughan, Sir Gerard

      Moate, Roger

      Viggers, Peter

      Montgomery, Sir Fergus

      Waddington, David

      Morrison, Hon C. (Devizes)

      Walden, George

      Moynihan, Hon C.

      Walker, Bill (T'side N)

      Mudd, David

      Waller, Gary

      Neale, Gerrard

      Wardle, C. (Bexhill)

      Nelson, Anthony

      Warren, Kenneth

      Neubert, Michael

      Watson, John

      Newton, Tony

      Watts, John

      Nicholls, Patrick

      Wells, Sir John (Maidstone)

      Norris, Steven

      Wheeler, John

      Onslow, Cranley

      Whitney, Raymond

      Oppenheim, Phillip

      Winterton, Mrs Ann

      Oppenheim, Rt Hon Mrs S.

      Wood, Timothy

      Osborn, Sir John

      Yeo, Tim

      Ottaway, Richard

      Young, Sir George (Acton)

      Page, Richard (Herts SW)

      Younger, Rt Hon George

      Parkinson, Rt Hon Cecil

      Patten, Christopher (Bath)

      Tellers for the Noes:

      Patten, J. (Oxf W & Abgdn)

      Mr. Francis Maude and

      Pawsey, James

      Mr. Gerald Malone.

      Peacock, Mrs Elizabeth

      Question accordingly negatived.
      Mr. Deputy Speaker: I understand that it will be for the convenience of the House if we take Government amendments formally in blocks, as we come to them, and non-Government amendments as we reach them on the Order Paper.
      Amendments made:—
      No. 16, in page 18, line 41, at end insert—
      '1A. —(1) Where a landlord proposes to apply to the Secretary of State for the approval or variation of a scheme, it shall serve a notice in writing on any secure tenant of a dwelling-house affected by the proposal stating—

      (a) the main features of the proposed scheme or, as the case may be, the scheme as proposed to be varied,

      (b) that the landlord proposes to apply to the Secretary of State for approval of the scheme or variation, and

      (c) the effect of such approval, by virtue of section 84 and ground 10A in Part II of this Schedule, in relation to proceedings for possession of the dwelling-house,

      and informing the tenant that he may, within such period as the landlord may allow (which shall be at least 28 days from service of the notice), make representations to the landlord about the proposal.
      (2) The landlord shall not apply to the Secretary of State until it has considered any representations made to it within that period.
      (3) In the case of a landlord to which section 105 applies (consultation on matters of housing management) the provisions of this paragraph apply in place of the provisions of that section in relation to the approval or variation of a redevelopment scheme.
      1B.—(1) In considering whether to give his approval to a scheme or variation the Secretary of State shall take into account, in particular—

      (a) the effect of the scheme on the extent and character of housing accommodation in the neighbourhood,

      (b) over what period of time it is proposed that the disposal and redevelopment will take place in accordance with the scheme, and

      (c) to what extent the scheme includes provision for housing provided under the scheme to be sold or let to existing tenants or persons nominated by the landlord;

      and he shall take into account any representations made to him and, so far as they are brought to his notice, any representations made to the landlord.
      (2) The landlord shall give to the Secretary of State such information as to the representations made to it, and other relevant matters, as the Secretary of State may require.'.
      No. 20 in page 19, line 29, leave out from 'include' to end of line 30 and insert
      "any authority or body within section 80 (the landlord condition for secure tenancies) having an interest of any description in the dwelling-house.'.—[Mr. Durant.]

    Clause 6

      MANAGEMENT AGREEMENTS
      Amendment made: No. 24, in page 21, line 33, leave out 'co-operative housing association' and insert
      'housing association of which at least half the members are tenants of dwelling-houses subject to the agreement, at least half the tenants of the dwelling-houses are members of the association and the proposed assignee is not, and is not willing to become, a member of the association.'.—[Mr. Durant.]

    Clause 7

      EXTENSION OF ASSURED TENANCIES SCHEME TO CASES WHERE WORKS HAVE BEEN CARRIED OUT
      Mr. Simon Hughes: I beg to move amendment No. 27, in page 24, line 8, at end insert—
      534
      '(3) In section 57(1) of the Housing Act 1980 after "section 56(4) of the Act, then" insert "(subject to subsection (2) below."
      (4) In section 57(2) of the Housing Act 1980, at end insert—
      "(b) the landlord under an assured
      tenancy has ceased to be an approved body by reason of unacceptability; and".'.
      This amendment relates to assured tenancies and to the need for there to be protection if the landlord ceases to be in the category of an approved landlord in the context of the relationship between the landlord and tenant under the approved tenancy scheme. If at the moment tenants remain under the assured tenure regime, in certain circumstances they lose, not by virtue of anything they do but by virtue of the change in the status of the landlord and the loss of approval given to the landlord. Tenants are thus in a new and vulnerable position instead of having any continuing protection.
      The amendment seeks to continue that protection, because it changes the status of the tenant if the tenancy has ceased to be held under a landlord who is an approved body, that landlord having lost that approval by virtue of his unacceptability. Although I was not present in the Committee, I have read what was said and the Minister will remember that a considerable debate took place about the bounds of the assured tenancy scheme. One of the areas of concern about the assured tenancy scheme was the risk when the approved landlord did not continue to have that approval for various reasons.
      I seek to give a slightly greater protection than presently exists as one of the ways of reflecting the general concern about the weaknesses in the assured tenancy scheme. From reading the evidence of the Committee, I understand that the Minister accepts that there are some weaknesses.
      Mr. John Patten: I presume that the Liberal party accepts the idea of the assured tenancy scheme and its extension being a good thing, because that was said by the hon. Member for Woolwich (Mr. Cartwright) during the Committee stage of the Bill.
      Mr. Hughes: Our view is that with the right protection the assured tenancy scheme can be continued, but we did not say explicitly that as it presently stands we accept it. I have read what my hon. Friend said in Committee and he did not give other than a cautious and qualified welcome to the proposals the Government said they intended to bring forward. I ask the Minister to add to the protection of tenants when the landlord ceases to have the status of acceptability. The proposal puts a landlord into the specific and limited status of being a landlord under the assured tenenacy scheme. I hope the Minister will be sympathetic.
      Mr. John Patten: Landlords who have their approval withdrawn are already prevented under the assured tenancy legislation from creating any further assured tenancies, as I am sure that the hon. Member for Southwark and Bermondsey (Mr. Hughes) knows. The effect of this amendment would be to deprive them of their existing assured tenancies, presumably by converting them into tenancies to which the Rent Acts would apply. That is my reading of the hon. Gentleman's mind, and he can say whether that is correct. We do not believe that it is right to penalise landlords in this way in respect of their existing assured tenancy lettings. The power of the Secretary of State to grant and withdraw approval is widely drawn.

      535
      The hon. Member for Woolwich has said that he looks to approved bodies such as building societies and other responsible institutions as being involved in this form of assured tenancy. The amendment could place doubt in the mind of an approved body about the position of an assured tenancy's lettings if the Government policy were to change. The hon. Member for Woolwich has recognised specifically the need for stability and the need not to put off responsible institutions. I believe that an approved body needs reasonable certainty. Having once created an assured tenancy that tenancy will be allowed to continue, otherwise the person involved has no protection for his investment and, in this case, almost always that person will actually be a large investing institution such as a building society, the Housing Corporation, and housing associations, which are also interested. If that certainty is put in doubt, as it would be by the amendment, the practical effect would be to discourage investment. That would be a great mistake. I hope that the hon. Gentleman will withdraw the amendment.
      Mr. Simon Hughes: The Minister did not address my specific concern and, therefore, I am not assured or satisfied by his response. I am concerned when landlords lose their acceptable status. I do not seek to put off people from becoming landlords under the scheme, but there are circumstances in which the landlord does not come within the category or would lose his acceptable status. I hope that the Minister will think again. I am prepared at this stage to give him a chance to do so in the hope that the matter will be dealt with in the other place. In that hope, I seek leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      It being Ten o'clock, further consideration of the Bill stood adjourned.

      BUSINESS OF THE HOUSE
      Ordered,
      That, at this day's sitting, the Housing and Planning Bill may be proceeded with, though opposed, until any hour. —[Mr. Neubert.]
      Bill, as amended (in the Standing Committee), again considered.
      Mr. Deputy Speaker: I understand that Government Amendments Nos. 28 to 30 are to be moved formally.
      Mr. Fraser: On Government amendments Nos. 28 and 30—
      Mr. Deputy Speaker: Order. The House agreed to take the Government amendments formally. I think that the hon. Member was here when that was done. I am afraid that we cannot go back on that decision. I shall repeat the amendments—Government amendments Nos. 28, 29, 30 and 31 to be moved formally. The question is that the amendments be made.
      Mr. Ron Davies: Division.
      Mr. Deputy Speaker: I am not clear whether the hon. Member wishes to divide on an amendment. If so, I need to know on which amendment he wishes to divide the House.
      Mr. Ron Davies: Government Amendment No. 28, Mr. Deputy Speaker.
      Mr. Deputy Speaker: I shall put the question on Government Amendment No. 28.

    Clause 10

      MINOR AND CONSEQUENTIAL AMENDMENTS; REPEALS
      Amendment proposed: No. 28, in page 26, line 6, at the end insert—
      '(ca) the deferment of completion in pursuance of the right to buy;'.—[Mr. Kenneth Baker.]
      Question put, That the amendment be made.
      The House proceeded to a Division; but no Member being willing to act as teller for the Noes, MR. DEPUTY SPEAKER declared that the Ayes had it.
      Mr. Deputy Speaker: I am anxious to meet the convenience of the House. I understand that we should now take formally the Government amendments and any amendments that have been discussed and merely pause on the other amendments. If there are any objections to that course, we shall not follow it. The House appears to agree, so we shall proceed on that basis.
      Amendments made: No. 29, in page 26, line 9, at end insert—
      '(da) the recovery of service charges in respect of the cost of grant-aided works;'.
      No. 30, in page 82, line 49 [Schedule 2], at end insert—

      'DEFERMENT OF COMPLETION IN PURSUANCE OF RIGHT TO BUY
      3A.—(1) In sections 140(3)(c) and 152(3) of the Housing Act 1985 (period before notice to complete can be served where tenant entitled to defer completion) for "two years" substitute "three years".
      (2) In sections 142(1)(c), (2) and (5) and 151(3) of that Act for "£100" (the amount which the tenant must deposit in order to be entitled to defer completion) substitute "£150".'.
      (3) The above amendments apply where notice under section 142(1) of that Act claiming to be entitled to defer completion is served after the commencement of this paragraph.
      (4) The above amendments to sections 140(3)(c), 142(5), 151(3) and 152(3) also apply where notice under section 142(1) of that Act claiming to be entitled to defer completion was served before the commencement of this paragraph if the tenant—

      (a) serves a further notice on the landlord claiming the benefit of the longer period, and

      (b) at the same time deposits with the landlord an additional £50;

      and section 142(5) applies to the sum so deposited as if it had been deposited in pursuance of a notice under that section.
      (5) No such further notice may be served if the landlord has already served a notice under section 140 or 152 of the Housing Act 1985 (landlord's first notice to complete).
      (6) The following provisions of the Housing Act 1985 apply, as to provisions of Part V of that Act, to the provisions of this paragraph relating to a further notice or deposit—

      section 170 (assistance in connection with legal proceedings),

      section 176 (form and service of notices),

      section 177 (errors and omisions in notices),

      section 180 (statutory declarations),

      section 181 (jurisdiction of county court). '.

      No. 31, in page 83, line 14 [Schedule 2], at end insert—

    'SERVICE CHARGES IN RESPECT OF THE COST OF GRANT-AIDED WORKS
    4A. — (1) In the Landlord and Tenant Act 1985, after section 20 insert—
    'SERVICE CHARGES IN RESPECT OF THE COST OF GRANT-AIDED WORKS

      Limitation of service charges: grant-aided works
      20A. Where relevant costs are incurred or to be incurred on the carrying out of works in respect of which a grant has been or is to be paid under Part XV of the

      537
      Housing Act 1985 (grants for works of improvement, repair or conversion), the amount of the grant shall be deducted from the costs and the amount of the service charge payable shall be reduced accordingly.".
      (2) In section 21 of the Landlord and Tenant Act 1985 (request for summary of relevant costs), in subsection (5) (contents of summary) after "shall" insert "state whether any of the costs relate to works in respect of which a grant has been or is to be paid under Part XV of the Housing Act (grants for works of improvement, repair or conversion) and".
      (3) In section 47 of the Housing Act 1985 (limitation on service charges payable after disposal of house by public sector authority), after subsection (3) add—
      "(4) Where relevant costs are incurred or to be incurred on the carrying out of works in respect of which a grant has been or is to be paid under Part XV (grants for works of improvement, repair or conversion), the amount of the grant shall be deducted from the costs and the amount of the service charge payable shall be reduced accordingly.".
      (4) In section 48 of the Housing Act 1985 (request for summary of relevant costs), after subsection (3) (contents of summary) insert—
      "(3A) The summary shall also state whether any of the costs relate to works in respect of which a grant has been or is to be paid under Part XV (grants for works of improvement, repair or conversion)".'.—[Mr. Kenneth Baker.]

    Clause 11

      SIMPLIFIED PLANNING ZONES IN ENGLAND AND WALES
      Mr. Nicholas Baker: I beg to move amendment No. 32, in page 27, line 2, leave out 'shall' and insert 'may'.
      Mr. Deputy Speaker (Sir Paul Dean): With this it will be convenient to take the following: Amendment No. 33, in page 27, line 6, leave out 'shall' and insert 'may'.
      No. 34, in page 27, line 8, leave out 'shall' and insert 'may'.
      No. 41, in page 89, line 4 [Schedule 3], at end insert—
      '(c) the local planning authority in non-metropolitan counties, as designated in section 11 Part (6), has determined that, in accordance with the options available to it in this Act, it does not require or intend that any of the area for which it is the planning authority be designated as a Simplified Planing Zone.'.
      Mr. Baker: My hon. Friend the Member for Christchurch (Mr. Adley) and other of my hon. Friends are not able to be present because they are consulting the King of Spain.
      The amendments relate to important matters that affect Dorset in particular but the south of England in general. We are not against the principle of simplified planning zones. Indeed, these are appropriate and right for metropolitan areas.
      The concern behind the amendments is that the simplified planning zones might lead to the suit of a developer, particularly with the connivance of a Government less favourable to the environment of the country than this Government, and might enforce simplified planning zones upon such areas in a way that would be inappropriate.
      The Minister has tabled a number of amendments to try to take account of these objections, but I must tell him that Wimborne district council tells me in a letter that in its view the amendments do not go far enough. It says:
      "whilst there may be some reluctance from Central Government to use the Power of Direction, it is considered to be an important element which would no doubt be used to override local considerations in unspecified circumstances."
      538
      What the Bill does in clause 11 is take away to a limited extent the power of the local authority over its own area in relation to these simplified planning zones. I, like all of us, am very concerned about the environment, and the state of the environment is much more potent an issue today than it was, as my hon. Friend will know. This is right and understandable.
      The amendments leave the decisions on exclusions to the Minister, not to the local authority. That is the source of the concern. I think the particular concern is highlighted in amendment No. 41. That is the key because it makes it clear that only in metropolitan areas at the suit of a complainant—and I have in mind particularly a developer—can the Minister override what the local authority say.
      If we do not have some protection in rural areas that are already suffering from over-development, with a Government that are less favourably inclined to rural areas, we might have a continuation of the over-development which I think no hon. Member would wish to see.
      I hope that my hon. Friend will look favourably on the amendments. As I have said, the key is in amendment No. 41. I look forward to what he has to say about the protection of the rural environment and the environment of the south of England, about which all of us who are signatories to the amendment are concerned.
      Mr. Simon Hughes: I support the hon. Member for Dorset, North (Mr. Baker). As the Bill is drafted, it requires local authorities to accept simplified planning zones both in concept and reality. The effect of the amendments would be that a local authority should not be required to accept a simplified planning zone but that the decision should be retained locally. The hon. Gentleman referred to Wimborne, so there are pressures in rural areas just as much as elsewhere; often there are more pressures in the south of England. There is pressure particularly in and around the green belt, although that may not apply so much to the district to which the hon. Gentleman referred. When there are pressures, it is appropriate for the local authority to decide whether to give additional planning advantage to people who wish to develop. Otherwise, there is a terrible risk that there will be an incentive for the wrong sort of development which would be out of keeping with the surrounding area.
      The Government should accept that there could easily be abuse of the powers that they are seeking to give themselves but which should properly be left with local government. The amendment is simple. I hope that the Government will accept that they need not go as far as they are at present minded to do.
      Mr. Tracey: As the night wears on too close to Friday, I hesitate to take too many liberties with the House, but I should register the Government's misgivings about the amendments and also put on record some assurances.
      The amendments would have a negative effect on the provisions in the Bill which enable local planning authorities to set up simplified planning zone schemes. They would remove certain duties placed on local planning authorities. Amendment No. 32 would make it optional rather than obligatory for authorities to give initial consideration to the desirability of SPZs in their areas. Similarly, amendment No. 33 would make it optional rather than obligatory for authorities to keep that question

      539
      under review. Amendment No. 34 would also remove the duty placed on authorities to prepare schemes when they have determined that it would be desirable to do so. This action too would become optional under the proposed amendment.
      Amendment No. 41 figured particularly in my hon. Friend's speech. The House should note that that amendment applies only to non-metropolitan district local planning authorities. Perhaps there is partisan thought behind it. It would not bite on the London Boroughs or on other metropolitan districts. I take it that the concern behind the amendment is to prevent simplified planning zone schemes from being set up in the less urban and rural parts of the country against the wishes of the planning authority.
      As regards the Secretary of State's powers of direction, which seem to be the main source of worry to my hon. Friends from the shires, these powers of direction are already limited to such cases as are referred to my right hon. Friend. Without referrals, my right hon. Friend cannot take action to make authorities prepare schemes. Even if he were minded to use the provision, it would be subject to obtaining the views of the authority. Where a scheme had to be prepared it would be subject to the full procedures of public participation and consultation, including a public local inquiry, if necessary.
      There are adequate and fair provisions to protect against unsuitable schemes being set up. My hon. Friends from the shire counties have made a fair attempt to amend the Bill, but we cannot accept the amendments. I urge my hon. Friend to seek to withdraw them.
      Mr. Nicholas Baker: I must make it clear that in putting forward the amendments my hon. Friends and I were not proposing a protective, Conservative, backward-looking measure. We seek to protect the environment of the south of England. We also seek to encourage development, but we may not all share the same views about how that should be done. We need to push development, especially in the north and in the extremities of the south of England. We are all agreed that derelict areas and parts of our cities need development. This is not a reactionary move at all. The quality of the environment is precious and must be protected. We are also anxious about the status of local authorities and the strength of local government. I accept what my hon. Friend said about the weakening of the responsibilities of local authorities implicit in amendments Nos. 32, 33 and 34.
      My anxiety is reflected in amendment No. 41, but I propose to take the assurances that my hon. Friend has given as his undertaking. I have seen his colleagues from the Department of the Environment, including my right hon. Friend the Secretary of State for the Environment. The idea that they would try to force local authorities in rural non metropolitan areas where simplified planning zones would be totally inappropriate to accept them against their will and against the wishes of a public inquiry is unthinkable. I accept that my hon. Friends would never do such a thing. Let us be careful that we never have a Government that might seek to override local authorities in an undemocratic and undesirable way. On the basis of the assurances, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.
      Amendments made: No. 35, in page 27, line 9, leave out 'determine' and insert 'decide'.
      No. 36, in page 28, line 17, after '(1)' insert—
      'The following descriptions of land may not be included in a simplified planning zone—

      (a) land in a National Park;

      (b) land in a conservation area;

      (c) land in an area designated under section 87 of the National Parks and Access to the Countryside Act 1949 as an area of outstanding natural beauty;

      (d) land identified in the development plan for the district as part of a green belt;

      (e) land in respect of which a notification or order is in force under section 28 or 29 of the Wildlife and Countryside Act 1981 (areas of special scientific interest).

      (2) Where land included in a simplified planning zone becomes land of such a description, subsection (1) does not have effect to exclude it from the zone.
      (3) '.—[Mr. Tracey.]

    Clause 12

      SIMPLIFIED PLANNING ZONES IN SCOTLAND
      Amendments made: No. 37, in page 29, line 28, leave out 'determine' and insert 'decide'.
      No. 38, in page 30, line 25, after '(1)', insert—
      'The following descriptions of land may not be included in a simplified planning zone—

      (a) land in a National Park:

      (b) land in a National Scenic Area:

      (c) land identified in the development plan for the area as part of a green belt;

      (d) land in respect of which a notification or order is in force under section 28 or 29 of the Wildlife and Countryside Act 1981 (areas of special scientific interest).

      (2) Where land included in a simplified planning zone becomes land of such a description, subsection (1) does not have effect to exclude it from the zone.—[Mr. Tracey.]

    Schedule 3

      SIMPLIFIED PLANNING ZONES: FURTHER PROVISIONS
      Amendments made: No. 39, in page 88, line 25, after 'make', insert 'or alter'.
      No. 40, in page 88, line 30, at end insert 'or the alterations'.
      No. 42, in page 90, leave out lines 11 to 24 and insert—
      '(5) The local planning authority shall before preparing the proposed scheme or alterations consult the Secretary of State having responsibility for highways as to the effect of their proposals on existing or future highways; and when they have prepared the proposed scheme or alterations they shall send him a copy.
      (6) A district planning authority in a non-metropolitan county shall also, before preparing the proposed scheme or alterations, consult the county council as planning authority and as to the effect of their proposals on existing or future highways; and when they have prepared the scheme or alterations they shall sent the county council a copy.'.
      43, in page 90, line 35 at end insert—
      '(2A) Each copy of the documents made available for inspections shall be accompanied by a statement of the time within which representations or objections may be made.'.
      No. 44, in page 90, line 46 leave out from 'the' to end of line 47 and insert 'Secretary of State having responsibility for highways.'.
      No. 45, in page 91, line 2 after 'shall', insert 'also'.
      No. 46, in page 91, line 2 leave out 'planning authority' and insert 'council'.
      No. 47, in page 91, line 7 leave out 'or 6(2)'.
      No. 48, in page 91, line 9 leave out or are taking.'.
      No. 49, in page 91, line 10 leave out 'or 6(3)'.
      No. 50, in page 91, line 12 at end insert—
      '(1A) The documents sent by the local planning authority to the Secretary of State under paragraph 6(2) shall be accompanied by a statement of the steps which the authority are taking to comply with paragraph 6(3).'.
      No. 51, in page 91, line 40, after 'inquiry', insert 'or other hearing'.
      No. 52, in page 93, line 34 leave out from 'Schedule' to end of line 37 and insert—

      (a) a simplified planning zone scheme or proposals for the alteration of such a scheme are required to be prepared, or

      (b) steps are required to be taken for the adoption of any such scheme or proposals,'.

      No. 53,in page 93, line 40 leave out from 'enable' to 'within' in line 41 and insert 'them to prepare or adopt such a scheme or proposals'.
      No. 54, in page 94, line 11 leave out from 'their' to end of line 12 and insert 'preparation, withdrawal, adoption, submission, approval,'.
      No. 55, in page 95, line 16 at end insert—
      '1A. In section 41 of the Town and Country Planning Act 1971 (limit of duration of planning permission), in subsection (3) (exceptions) after paragraph (aa) insert — " (ab) to any planning permission granted by a simplified planning zone scheme; ".'.
      No. 56, in page. 96, line 34 after 'make', insert 'or alter'.
      No. 57, in page 96, line 39 at end insert 'or the alterations'.
      No. 58, in page 98 leave out lines 23 to 29 and insert—
      '(5) The planning authority shall before preparing the proposed scheme or alterations consult the Secretary of State and any local roads authority in whose district the proposed zone or any part of it lies as to the effect of their proposals on existing or future roads; and when they have prepared the proposed scheme or alterations they shall send a copy to the Secretary of State and any such local roads authority.'.
      No. 59, in page 98, line 34 leave out or are taking,'.
      No. 60, in page 99, line 7 after 'inquiry', or other hearing'.
      No. 61, in page 100, line 37 after 'any', insert 'planning authority or any other'
      No. 62 in page 100, line 43, leave out from 'Schedule' to end of line 46 and insert—

      '(a) a simplified planning zone scheme or proposals for the alteration of such a scheme are required to be prepared or

      (b) steps are required to be taken for the adoption of any such scheme or proposals,'.

      No. 63, in page 101, line 3 leave out from 'enable' to 'within' in line 4 and insert—
      'them to prepare or adopt such a scheme or proposals,'.
      No. 64, in page 101, line 22 leave out from beginning to 'making' in line 23 and insert 'preparation, withdrawal, adoption, submission, approval,'.
      No. 65, in page 102, line 27 at end insert—
      '1A. In section 38 of the Town and Country Planning (Scotland) Act 1972 (limit of duration of planning permission), in subsection (3) (exceptions) after paragraph (aa) insert—
      "(ab) to any planning permission granted by a simplified planning zone scheme; ".'.—[Mr. Tracey.]

    Clause 13

      POWER TO GIVE ASSISTANCE
      Mr. Sydney Chapman: I beg to move amendment No. 66. in page 31, line 8, after 'environment', insert
      , providing employment for people who live in the area.'.
      I think mine is the only non-Government amendment between now and Third Reading so I shall try to detain
      542
      hon. Members as little as possible. This amendment was partially inspired by the amendment moved by the hon. Member for Birmingham, Perry Barr (Mr. Rooker) in Committee. He quite rightly drew attention in Committee to the importance of local employment prospects as a condition of Government grants.
      The hon. Member for Perry Barr stressed that it was important that expenditure incurred under the powers of Part 3 should provide jobs for local residents. In reply, my hon. Friend the Minister expressed his sympathy for the idea of that amendment, but he quite properly drew attention to the difficulty of introducing any legal requirements. In Committee, I said that it would be difficult to enshrine a statutory requirement to provide local jobs. Backbenchers sometimes feel impelled, if I may use a slightly hackneyed phrase, to rush in where Ministers fear to tread. The creation of jobs for local people is one of the objectives of urban regeneration. The word "employment" does not occur in the introduction to part III of the Bill and I hope that my hon. Friend the Minister will sympathetically consider my amendment.
      My hon. Friend the Minister is responsible for a number of initiatives which have important employment benefits. I mention the community refurbishing scheme, under which unemployed local people work on turning round conditions on council estates. This approach should be more widely adopted, and I hope that my hon. Friend will accept this approach, which is the purpose of the amendment.
      Mr. John Patten: We often pay compliments to one another in the House, sometimes rather excessively, just as we attack each other rather too excessively. My hon. Friend the Member for Chipping Barnet (Mr. Chapman) has been tireless in his constructive contributions to this debate and in Standing Committee, and in his attempts to improve the Bill. We have found some of his amendments easier to accept than others. I have from time to time been defeated by him in Standing Committee, and I shall seek my revenge at a later stage in some other forum.
      I believe that once again my hon. Friend has come up with a formulation which will improve the Bill. It reflects the general wishes of the hon. Member for Birmingham, Perry Barr (Mr. Rooker), and I pay tribute to the force with which my hon. Friend deployed those arguments. His amendment strikes the right balance and reflects an all-party agreement to try to do more for employment in these areas. It recognises the general will of Parliament, without taking us into the difficult territory of imposing mandatory requirements. I have great pleasure in accepting it.
      Amendment agreed to.

    Clause 17

      HAZARDOUS SUBSTANCES
      Amendments made: No. 67, in page 33, line 34, at end insert 'or is only required'.
      No. 68, in page 38, line 40, at end insert—

      'Grants of hazardous substances consent without compliance with conditions previously attached
      58EE. — (1) This section applies to an application for hazardous substances consent without a condition subject to which a previous hazardous substances consent was granted.
      (2) On such an application the hazardous substances authority shall consider only the question of the conditions subject to which hazardous substances consent should be granted, and—

      543

      (a) if they determine that hazardous substances consent should be granted subject to conditions differing from the subject to which the previous consent was granted, or that it should be granted unconditionally, they shall grant hazardous substances consent accordingly; and

      (b) if they determine that hazardous substances consent should be granted subject to the same conditions as those subject to which the previous consent was granted, they shall refuse the application.

      (3) Where—

      (a) hazardous substances consent has been granted or is deemed to have been granted for the presence on, over or under land of more than one hazardous substance; and

      (b) an application under this section does not relate to all the substances,

      the hazardous substances authority shall only have regard to any condition relating to a substance to which the application does not relate to the extent that it has implications for a substance to which the application does relate.
      (4) Where—

      (a) more than one hazardous substances consent has been granted or is deemed to have been granted in respect of the same land; and

      (b) an application under this section does not relate to all the consents,

      the hazardous substances authority shall only have regard to any consent to which the application does not relate to the extent that it has implications for consent to which the application does relate.
      (5) Regulations may make provision in relation to applications under this section corresponding to any provision that may be made by regulations under section 58B above in relation to applications for hazardous substances consent.'
      No. 69, in page 39, line 2, leave out from 'that' to end of line 4 and insert—

      '(a) there has been a material change of use of land to which a hazardous substances consent relates; or

      (b) planning permission has been granted for development the carrying out of which would involve a material change of use of such land and the development to which the permission relates has been commenced,'.

      No. 70, in page 39, leave out lines 11 to 21 and insert—
      '(2) The hazardous substances authority may by order—

      (a) revoke a hazardous substances consent which relates to only one substance if it appears to them that that substance has not for at least 5 years been present on, under or over the land to which the consent relates in a quantity equal to or exceeding the controlled quantity; and

      (b) revoke a hazardous substances consent which relates to a number of substances if it appears to them that none of those substances has for at least 5 years been so present.'.

      No. 71, in page 40, line 37, at end insert—
      '(2A) Regulations may make provision in relation to applications under subsection (2) above corresponding to any provision that may be made by regulations under section 58B of this Act in relation to applications for hazardous substances consent.'.
      No. 72, in page 40, line 42, at end insert—
      '(3A) Without prejudice to the generality of subsection (3) above, in dealing with an application the authority shall have regard—

      (a) to the matters to which a hazardous substances authority are required to have regard by section 58C(2) (a) to (d) above; and

      (b) to any advice which the Health and Safety Executive or Health and Safety Commission have given following consultations in pursuance of regulations under subsection (2A) above.

      (3B) If an application relates to more than one consent, the authority may make different determinations in relation to each.
      (3C) If a consent relates to more than one hazardous substance, the authority may make different determinations in relation to each.
      (3D) It shall be the duty of a hazardous substances authority, when continuing hazardous substances consent, to attach to the consent one of the following—

      (a) a statement that it is unchanged in relation to the matters included in it by virtue of section 58C(4) above;

      (b) a statement of any change in respect of those matters.

      (3E) The modifications which a hazardous substances authority may make by virtue of subsection (3)(a) above include, without prejudice to the generality of that paragraph, the making of the consent subject to conditions with respect to any of the matters mentioned in section 58C(5).
      (3F) Subject to subsection (3G) below, sections 35 to 37 of this Act shall have effect in relation to applications under subsection (2) above and to decisions on such applications as though they were applications for planning permission.
      (3G) In the application of sections 35 to 37 of this Act by virtue of subsection (3F) above—

      (a) references to the local planning authority shall be construed as references to the hazardous substances authority;

      (b) section 35(4) and section 36(5) and (7) shall be omitted;

      (c) the words "and in such manner as may be prescribed" shall be substituted for the words in section 36(2) following "time";

      (d) in section 37—

      (i) the words "by the development order" shall be omitted from the first place where they occur; and

      (ii) the words "the application shall be deemed to have been granted" shall be substituted for the words following paragraph (b).'—[Mr. John Patten.]

    Clause 20
      TRANSITIONAL PROVISION
      Amendment made: No. 73, in page 47, line 17, leave out Clause 20—[Mr. John Patten.]
    Clause 21

      HAZARDOUS SUBSTANCES
      Amendments made: No. 74, in page 50, line 26, at end insert 'or is only required'.
      No. 75, in page 55, line 29, at end insert—

      Grants of hazardous substances consent without compliance with conditions attached.
      '56GG.—(1) This section applies to an application for hazardous substances consent without a condition subject to which a previous hazardous substances consent was granted or is deemed to have been granted.
      (2) On such an application the planning authority shall consider only the question of the conditions subject to which hazardous substances consent should be granted, and—

      (a) if they determine that hazardous substances consent should be granted subject to conditions differing from those subject to which the previous consent was granted, or that it should be granted unconditionally, they shall grant hazardous substances consent accordingly; and

      (b) if they determine that hazardous substances consent should be granted subject to the same conditions as those subject to which the previous consent was granted, they shall refuse the application.

      (3) Where—

      (a) hazardous substances has been granted or is deemed to have been granted for the presence on, over or under land of more than one hazardous substance; and

      (b) an application under this section does not relate to all the substances,

      the planning authority shall only have regard to any condition relating to a substance to which the application does not relate to the extent that it has implications for a substance to which the application does relate.
      (4) Where—

      545

      (a) more than one hazardous substances consent has been granted or is deemed to have been granted in respect of the same land; and

      (b) an application under this section does not relate to all the consents,

      the planning authority shall only have regard to any consent to which the application does not relate to the extent that it has implications for a consent to which the application does relate.
      (5) Regulations may make provision in relation to applications under this section corresponding to any provision that may be made by regulations under section 56D of this Act in relation to applications for hazardous substances consent.'
      No. 76, in page 55, line 31 leave out from 'that' to 'they' in line 33 and insert—

      '(a) there has been a material change of use of land to which a hazardous substances consent relates; or

      (b) planning permission has been granted for development the carrying out of which would involve a material change of use of such land and the development to which the permission relates has been commenced,'

      No. 77, in page 55, line 40 leave out from beginning to end of page 56, line 5 and insert—
      '(2) The planning authority may by order—

      (a) revoke a hazardous substances consent which relates to only one substance if it appears to them that that substance has not for at least 5 years been present on, under or over the land to which the consent relates in a quantity equal to or exceeding the controlled quantity; and

      (b) revoke a hazardous substances consent which relates to a number of substances if it appears to them that none of those substances has for at least 5 years been so present.'.

      No. 78, in page 57, line 13 at end insert—
      '(2A) Regulations may make provision in relation to applications under subsection (2) above corresponding to any provision that may be made by regulations under section 56D of this Act in relation to applications for hazardous substances consent. '.
      No. 79, in page 57, line 18, at end insert—
      '(3A) Without prejudice to the generality of subsection (3) above, in dealing with an application the authority shall have regard—

      (a) to the matters to which a planning authority are required to have regard by section 56E(2)(a) to (d) above; and

      (b) to any advice which the Health and Safety Executive or Health and Safety Commission have given following consultations in pursuance of regulations under subsection (2A) above.

      (3B) If an application relates to more than one consent, the authority may make different determinations in relation to each.
      (3C) If a consent relates to more than one hazardous substance, the authority may make different determinations in relation to each.
      (3D) It shall be the duty of a planning authority, when continuing hazardous substances consent, to attach to the consent one of the following—

      (a) a statement that is unchanged in relation to the matters included in it by virtue of section 56E(4) above;

      (b) a statement of any change in respect of those matters.

      (3E) The modifications which a planning authority may make by virtue of subsection (3)(a) above include, without prejudice to the generality of that paragraph, the making of the consent subject to conditions with respect to any of the matters mentioned in section 56E(5) above.
      (3F) Subject to subsection (3G) below, section 32 to 34 of this Act and section 179 of the Local Government (Scotland) Act 1973 shall have effect in relation to applications under subsection (2) above and to decisions on such applications as though they were applications for planning permission.
      (3G) In the application of sections 32 to 34 of this Act by virtue of subsection (3F) above—

      (a) section 32(3) and section 34(5) and (7) shall be omitted;

      (b) the words "and in such manner as may be prescribed" shall be substituted for the words in section 33(2) following "time";

      (c) in section 34—

      546

      (i) the words "by the development order" shall be omitted from the first place where they occur; and

      (ii) the words "the application shall be deemed to have been granted" shall be substituted for the words following paragraph (b).'.

      No. 80, in page 59, line 6, at end insert 'being or is'.
      No. 81, in page 59, line 40, leave out 'by a development order'.—[Mr. Kenneth Baker.]

    Clause 24
      TRANSITIONAL PROVISIONS—SCOTLAND
      Amendment made: No. 82, in page 63, line 32, leave out Clause 24—[Mr. John Patten.]
    Schedule 4

      HAZARDOUS SUBSTANCES: CONSEQUENTIAL PROVISIONS
      Amendments made: No. 83, in page 104, line 4 at end insert—
      '4A. The following section shall be inserted after section 271 of that Act—

      Application to certain hazardous substances authorities of provisions as to hazardous substances control
      271A. — (1) The provisions of this Act relating to hazardous substances shall have effect subject to such exceptions and modifications as may be prescribed in relation to granting hazardous substances consent for authorities who are hazardous substances authorities by virtue of section 1A of this Act.
      (2) Subject to the provisions of section 58E of this Act, any such regulations may in particular provide for securing—

      (a) that any application by such an authority for hazardous substances consent in respect of the presence of a hazardous substance on, over or under land shall be made to the Secretary of State and not to the hazardous substances authority;

      (b) that any order or notice authorised to be made, issued or served under those provisions shall be made, issued or served by the Secretary of State and not by the hazardous substances authority.".'.

      No. 84, in page 105, line 24, leave out 'paragraph 17' and insert
      'the entry relating to the Sewerage (Scotland) Act 1968 in Part II'.
      No. 85, in page 105, line 40, at end insert—
      '3A. The following section shall be inserted after section 257 of that Act—

      Application to planning authorities of provisions as to hazardous substances control
      257A.—(1) The provisions of this Act relating to hazardous substances shall have effect subject to such exceptions and modifications as may be prescribed in relation to hazardous substances consent for planning authorities.
      (2) Subject to the provisions of section 56G of this Act, any such regulations may in particular provide for securing—

      (a) that any application by such an authority for hazardous substances consent in respect of the presence of a hazardous substance on, over or under such land shall be made to the Secretary of State and not to the planning authority;

      (b) that any order or notice authorised to be made, issued or served under those provisions shall be made, issued or served by the Secretary of State and not by the planning authority.".'.

      No. 86, in page 106, line 44, at end insert—

      'Town and Country Planning Act 1984 (c. 10)
      6. In section 1 of the Town and Country Planning Act 1984 (application in anticipation of disposal of Crown interest)—

      (a) in subsection (1)(a), after the words "listed building consent" there shall be inserted the words ", hazardous substances consent"; and

      (b) the following subsection shall be inserted after subsection (3)—

      "(3A) Any hazardous substances consent granted by virtue of this section shall apply only—

      547

      (a) to the presence of the substance to which the consent relates aftr the land in question has ceased to be Crown land: and

      (b) so long as that land continues to be Crown land, to the presence of the substance by virtue of a private interest in the land.".'.—[Mr. John Patten.]

    Schedule 5

      OPENCAST COAL: MISCELLANEOUS AMENDMENTS
      Amendments made: No. 87 in page 107, line 8 at end insert
      'or to carry out operations incidental to such working'.
      No. 88, in page 113, leave out lines 34 to 37.
      No. 89, in page 113, line 44, leave out 'have applied' and insert 'are proposing to apply'.
      No. 90, in page 114, line 3, leave out '28 days' and insert
      'such time, not being less than 28 days from the first publication of the notice, as may be specified'.
      No. 91, in page 116, line 17, leave out from 'permission' to end of line 19 and insert
      'which permits the Board to work coal by opencast operations or to carry out operations incidental to such working.'.
      No. 92, in page 116, line 24, after 'permission', insert
      'and the carrying out of operations incidental to such working.'.
      No. 93, in page 116, line 35, at end insert—
      '(13A) In paragraph 5(1) of Part I of Schedule 2 (compulsory rights orders)—

      (a) for the words "an authorisation under section one of this Act" there shall be substituted the words "opencast planning permission"; and

      (b) for the words from "an authorisation", in the second place where those words occur to "operations" there shall be substituted the words "opencast planning permission should be granted or should have been granted.".'.—[Mr. John Patten.]

    Clause 26
      LISTED BUILDINGS AND CONSERVATION AREAS
      Amendment made: No. 94, in page 66, leave out lines 41 to 44.—[Mr. Kenneth Baker.]
    Clause 34

      LISTED BUILDINGS AND CONSERVATION AREAS—SCOTLAND
      Amendments made: No. 95, in page 75, line 1, at end insert—
      '(ba) applications to vary or revoke conditions attached to planning permission;'.
      No. 96, in page 75, line 8, leave out 'inspectors' and insert 'appointed persons'.

    Schedule 6

      LISTED BUILDINGS AND CONSERVATION AREAS
      Amendments made: No. 99, in page 118, line 34, at end insert—
      '(3) Renumber paragraph 9 of Schjedule 11 to the Town and Country Planning Act 1971 (appeal in default of decision) as sub-paragraph (1) of that paragraph and after it insert—
      "(2) Sub-paragraph (1) of this paragraph applies to an application to the local planning authority for approval by the authority required by a condition imposed on the granting of listed building consent with respect to details of the works as it applies to an application for listed building consent, with the following modifications—
      548

      (a) for references to the prescribed period substitute references to the period of eight weeks from the date of the receipt of the application, and

      (b) omit paragraph (b) and the word 'or' preceding it".'.

      No. 101, in page 121, line 7, leave out '56A' and insert '56B'.
      No. 102, in page 121, line 14, after 'consent),' insert
      'sections 242, 243, 245 and 246 (validity of orders, proceedings for review and appeals)'.
      No. 103, in page 121, line 15, at end insert
      'section 271 and Part VI of Schedule 21 (application of provisions to works by local planning authority)'.
      No. 104, in page 122, line 43, at end insert—

      'Application to local planning authorities of provisions relating to listed buildings
      10. In Part VI of Schedule 21 to the Town and Country Planning Act 1971 (provisions of Act applying to applications by local planning authorities with respect to listed buildings), at the appropriate place insert "Sections 242, 243, 245 and 246.".'.
      No. 105, in page 124, line 12, at end insert—
      '(3) Renumber paragraph 8 of that Schedule (appeal in default of decision) as sub-paragraph (1) of that paragraph and after it insert—
      "(2) Sub-paragraph (1) of this paragraph applies to an application to the planning auhority for approval by the authority required by a condition imposed on the granting of listed building consent with respect to details of the works as it applies to an application for listed building consent, with the following modifications—

      (a) for references to the prescribed period substitute references to the period of two months from the date of the receipt of the application, and

      (b) omit paragraph (b) and the word 'or' preceeding it.".'.

      No. 106, in page 126, line 21, leave out paragraph 7 and insert—
      '(7) Section 262A(8) of the Town and Country Planning (Scotland) Act 1972 (application to buildings in conservation areas of provisions relating to listed buildings) is amended as follows—

      (a) for the words from "section 53" to "section 54C" substitute "section 53 to 54D":

      (b) for "section 92 to 95" substitute "section 92 to 96";

      (c) after "section 179" insert "sections 231, 233 and 23";

      (d) after "section 253(1)(b)" insert "section 257";

      (e) after "Schedule 17" insert "Part IV of Schedule 19".'.

      No. 107, in page 127, line 9, at end insert—

      'Application to planning authorities of provisions related to listed buildings
      10. In Part IV of Schedule 19 to the Town and Country Planning (Scotland) Act 1972 (provisions of Act applying to applications by planning authorities with respect to listed buildings), at the appropriate place insert "Sections 231, 233 and 234" '.—[Mr. John Patten.]
    Clause 27
      LOCAL PLANS AND UNITARY DEVELOPMENT PLANS
      Amendment made: No. 108, in page 67, line 31, leave out 'repealing'.—[Mr. Kenneth Baker.]
    Schedule 7

      LOCAL PLANS AND UNITARY DEVELOPMENT PLANS
      Amendment made: No. 109, in page 128, line 17, leave out first 'development' and insert 'treatment'.
      No. 110, in page 130, line 8, leave out 'or'.
      No. 111, in page 130, line 8, after 'repeal', insert 'or replacement plan'.
      No. 112, in page 130, line 32, at end insert—

      549
      '(2A) Each copy of the documents made available for inspection shall be accompanied by a statement of the time within which repesentations or objections may be made.'.
      No. 113, in page 130, line 43, leave out 'or 12A'.
      No. 114, in page 130, line 45, leave out 'or are taking'.
      No. 115, in page 130, line 46, leave out from 'with' to ', and' and insert 'subsection (2) of that section'.
      No. 116, in page 131, line 2, at end insert—
      '(1A) The documents sent by the local planning authority to the Secretary of State under section 12A shall be accompanied by a statement of the steps which the authority are taking to comply with subsection (3) of that section.'.
      No. 117, in page 131, line 29, after 'or', insert 'other'.
      No. 118, in page 133, line 38, after 'alteration', insert 'repeal'.
      No. 119, in page 134, line 8, after 'alteration', insert 'repeal'.
      No. 120, in page 134, leave out lines 21 to 31 and insert—
      'of a local planning authority proposing to make, alter, repeal or replace a local plan, direct that it shall be assumed for that purpose that the structure plan proposals have been approved by him, subject to such modifications as may from time to time be proposed by him and notified to the county planning authority.
      (2) A direction ceases to have effect if the Secretary of State rejects the proposals for the alteration or replacement of the structure plan'.
      No. 121, in page 134, leave out lines 33 to 35 and insert—

      '(a) in the case of an application by a county planning authority, any district planning authority whose area is affected by the relevant local plan proposals; or

      (b) in the case of an application by a district planning authority, the county planning authority.'.

      No. 122, in page 134, line 38, leave out 'in force'.
      No. 123, in page 134, line 38, leave out 'by the alterations'.
      No. 124, in page 135, line 7, leave out 'amended' and insert 'altered'.
      No. 125, in page 135, line 10, at end insert—
      'and the alteration, repeal of replacement plan has come into force'.
      No. 126, in page 135, line 41, at end insert—
      '(2A) Each copy of the documents made available for inspection shall be accompanied by a statement of the time within which representations or objections may be made.'.
      No. 127, in page 136, leave out lines 7 to 13 and insert—
      '(4) The documents sent by the local planning authority to the Secretary of State under sub-paragraph (2) above shall be accompanied by a statement of the steps which the authority are taking to comply with sub-paragraph (3) above.'.—[Mr. John Patten.]

    Schedule 8

      PLANNING: MINOR AND CONSEQUENTIAL AMENDMENTS
      Amendments made: No. 128, in page 141, line 40, after 'is', insert 'to be'.
      No. 129, in page 141, line 41, leave out 'regulations' and insert 'rules'.
      No. 130, in page 147, line 14, leave out 'they have' and insert 'it has'.
      No. 131, in page 147, line 16, leave out 'the proposals are' and insert 'any part of it is'.
      No. 132, in page 147, line 18, leave out 'proposals' and insert 'plan'.
      No. 133, in page 147, line 21, leave out 'proposals' and insert 'plan'.
      No. 134, in page 147, line 27, leave out '1972 Act' and insert
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      'Town and Country Planning (Scotland) Act 1972'.
      No. 135, in page 150, line 32, at end insert—

      'National Scenic Areas
      8A. After section 262B of the Town and Country Planning (Scotland) Act 1972 insert—

      National scenic areas.
      262C. — (1) Where it appears to the Secretary of State, after such consultation with such persons or bodies as he thinks fit, that an area is of outstanding scenic value and beauty in a national context, and that special protection measures are appopriate for it, he may designate the area by a direction under this section as a National Scenic Area; and any such designation may be varied or cancelled by a subsequent direction.
      (2) Notice of any such designation, variation, or cancellation as is mentioned in subsection (1) above shall be published in the Edinburgh Gazette and in at least one newspaper circulating in the vicinity of the Area by the Secretary of State.
      (3) Every planning authority shall compile and be available for inspection free of charge at reasonable hours and at a convenient place a list containing such particulars as the Secretary of State may determine of any area in their district which has been designated as a National Scenic Area.
      (4) Where any area is for the time being designated as a National Scenic Area, special attention shall be paid to the desirability of preserving or enhancing its character or appearance in the exercise, with respect to any land in that area, of any powers under this Act.
      No. 136, in page 153, line 18, after 'references'. insert 'to the Minister'.
      No. 137, in page 153, line 33, after 'is', insert 'to be'.
      No. 138, in page 153, line 34, leave out 'regulations' and insert 'rules'.
      No. 139, in page 154, line 30, leave out 'inspector' and insert 'appointed person.'
      No. 140, in page 154, line 37, leave out from 'appeal' to end of line 39.
      No. 141, in page 155, leave out lines 20 to 25.
      No. 142, in page 155, line 12, leave out '(a)'.
      No. 143, in page 156, line 15, leave out 'section 205(3) (a)' and insert 'sections 205(3)(a) and 205A(3)(a)'.
      No. 144, in page 156, line 48, at end insert—
      '22A. In sections 32(4) and 33(5) of the Town and Country Planning (Scotland) Act 1972 for the words "and 27A" substitute "27A and 28A".'.
      No. 145, in page 157, line 3, at end insert—
      '23A. In section 53(4) of the Town and Country Planning (Scotland) Act 1972 omit "under section 54 of this Act.".
      23B. In section 275(1) of the Town and Country Planning (Scotland) Act 1972 (interpretation)—
      (a) the following shall be inserted after the definition of
      "restriction on the winning and working of minerals" —
      " 'roads authority' has the same meaning as in the Roads (Scotland) Act 1984";
      (b) the following shall be inserted after the definition of "Minister"—
      "'national scenic area' has the meaning assigned to it by section 262C of this Act".'.
      No. 146, in page 157, line 4, leave out 'II' and insert 'III'.
      No. 147, in page 157, line 6, at end insert—
      'Consequential amendments of other enactments
      24A. In subsection (5) of section 179 (reference of applications to regional planning authority) of the Local Government (Scotland) Act 1973, after "27A" insert "28A,".'.—[Mr. John Patten.]

    Clause 38

      COMMENCEMENT
      Amendments made: No. 148, in page 75, line 31, after '3', insert '4A,'.—[Mr. Robert B. Jones.]
      No. 149, in page 75, line 37, after '4', insert
      '(Proposals for co-operative management or ownership)'.
      No. 153, in page 76, line 4, leave out 'second' and insert 'first'.—[Mr. Kenneth Baker.]

    Schedule 9

      REPEALS
      Amendments made: No. 154, in page 158, line 36, at end insert—
      '1986 c.5. Agricultural Holdings Act In Schedule 14, paragraph 1986 25.'
      No. 155, in page 158, leave out lines 45 and 46.
      No. 156, in page 160, line 42, column 2, at beginning insert 'Control of.
      No. 157, in page 160, line 55, column 3, after 'In', insert 'Part II of.
      No. 158, in page 161, line 5, column 3, at beginning insert Section 3(2).'.
      No. 159, in page 161, line 8, at end insert—
      1968 c.14. Public Expenditure and In Schedule 3, in para-Receipts Act 1968. graph 6, the entry relating to section 355(8) of the Local Government (Scotland) Act 1947.'.
      No. 160, in page 161, line 15, at end insert—
      'In section 53(4), the words—
      "under section 54 of this Act". '.
      No. 161, in page 161, line 43, at end insert—
      'In section 247(1)(d), the words from "in" to "grants".'.
      No. 162, in page 162, line 10, at end insert—
      '(a) in part I, the reference to sections 237, 238(1) and 239;.
      No. 163, in page 162, line 17, after '25', insert 'and 60'.
      No. 164, in page 162, line 18, at end insert—

      'paragraph 10 of Part II of Schedule 2.

      1984 c.27.

      Road Traffic Regulation Act 1984

      In section 129(1)(d) the words from "(including" to "in the inquiry)".'. — [Mr. John Patten.]

      Order for Third Reading read.
      Motion made, and Question proposed, That the Bill be now read the Third time.—[Mr. John Patten.]
      10.23 pm
      Mr. John Fraser: We have debated the Bill vigorously, especially clause 5 and other objectionable provisions, but on other clauses we have acted constructively. We hope to see legislation on the Nugee committee recommendations absolutely guaranteed next Session. We have secured some improvements in the law on improvement grants for flats and we have made a significant contribution to co-operative involvement by tenants. We welcome those parts of clause 6 which will give tenants a greater say in their management and greater control over their environment.
      We have opposed those parts of clause 6 which were aimed simply at private management for private profit, but
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      the Government amendment, which they hope to reinforce in another place, will virtually guarantee council tenants a veto on privatisation over their heads.
      A number of matters which should be in the Bill are not. It represents missed opportunities, because it is largely about the management, rather than the provision, of housing. Our criticisms, not least in the debate on Tuesday, of the gross inadequacy of housing provision remain as forceful as ever. The Bill does nothing to improve the supply or the quantity of housing.
      There are two things that I should like to see in the Bill when it returns from another place. One most important matter is in relation to homelessness. There has recently been a court decision to the effect that the homeless persons legislation only requires a local authority to make provision for the homeless and not to provide housing. That interpretation of the law is nonsensical. I hope that the Government will undertake to amend that aspect of homelessness law in another place. There is also the question of interpretation of section 91 of the Housing Act 1985. There is some misunderstanding about whether that section makes a tenancy assignable or simply capable of assignment.
      The other matter that the Bill does not deal with satisfactorily is the problem of the inner city. Of course, there is the urban regeneration grant. We discussed that matter constructively in Committee. However, although there has been a period of quiet and the inner cities have been hibernating over a long winter and a cool spring, the Bill's attempts to deal with the inner cities and urban regeneration are not nearly sufficient to tackle the problem.
      I represent an inner city constituency. There are over 3,000 unemployed school and college leavers in my borough. That is not untypical of the situation in many city areas. In other words, three battalions of young appear to have lost the struggle before they have started the fight. The effects of such a level of unemployment flow back into the schools and demoralise the entire community.
      Lambeth has a problem that has been repeated in Handsworth and other inner city areas—the virtual impossibility for some businessmen of insuring their premises. There can be no greater disincentive to setting up a business than finding that you cannot get insurance cover to protect it. That is a very serious symptom of the problems of the inner city.
      Poverty continues to increase as well as unemployment, and the measures in the Bill in that area are mere pinpricks. We shall have to return time and time again to the question of finding a more effective way of dealing with problems that could easily be resurrected as the weather becomes warmer. I am most concerned about the inadequacy of the Bill, in housing and inner city terms, to provide the resources to meet the undoubted problems that still exist.
      Mr. Chapman: My right hon. Friend the Minister made some extraordinarily generous remarks about amendment No. 66. I appreciate very much what he said. I should also like to comment very briefly on Government amendment No. 36, which was inspired, I believe, by an amendment that I put forward in Committee. I am grateful to the Minister for agreeing that simplified planning zones should not be created in national parks, conservation areas, areas of outstanding natural beauty, areas of special scientific interest or—to add a final rider—green belt areas. I have the privilege to be the president of the

      553
      London Green Belt Council. The amendment is a great advance and will give immense reassurance to environment organisations concerned with the conservation of our countryside.
      The Minister courteously informed me, after I moved an amendment in Committee about the demolition of listed buildings and the relevant procedures, that he would introduce an amendment, on the lines that I suggested, in another place. I hope that he will take into consideration the words of the chairman of English Heritage and the joint committee of various organisations concerned with conserving, in an intelligent way, our architectural heritage. I was not responsible for designing any part of that heritage, but I believe that if we can conserve it, untold future generations will benefit. We have had very constructive Committee and Report stages, with active and intelligent participation from hon. Members on both sides, which has, indeed, improved the Bill.
      10.29 pm
      Mr. Cartwright: I agree with the hon. Member for Norwood (Mr. Fraser) that, in its housing application, this is a Bill about management. But unlike him, I do not complain about that. Given the state of housing management, it is important to approach some of the problems that flow from that.
      The interesting factor has been the degree of agreement across the political divide as to the ways in which housing management can be improved. The encouragement of housing co-operatives is one obvious example of that. The Bill makes a useful contribution towards making that idea a reality and towards giving people more control over their homes and their environment. I welcome the degree of agreement achieved over the need to encourage assured tenancies and to try to find new forms of rented accommodation to meet the need that clearly exists.
      The urban regeneration grant may not make a dramatic contribution to the problems of our inner cities, but it should not be despised. It is worth having, and I welcome it. However, I am somewhat more sceptical about simplified planning zones. I should welcome them if they made a contribution, but I shall wait to see whether the fears that I and other have expressed are founded or whether the simplified planning zones make a bigger contribution than we expect.
      I certainly endorse what the hon. Member for Chipping Barnet (Mr. Chapman) has said. We have had some very useful debates on the Bill, and both sides of the House have co-operated to make it a better Bill. I pay tribute to the Minister for his sensitive handling of the Bill and for the way in which he has responded to constructive proposals and has returned with ways of meeting our objectives. He has not always met them in full, but he has honestly and sincerely tried to take our views into consideration. That has greatly helped the Bill's passage.
      10.31 pm
      Mr. Winnick: The Bill should not go to the other place wihout its critics once again making their position clear, just as my hon. Friend the Member for Norwood (Mr. Fraser) has done.
      The Bill does not help to provide a single new dwelling. Incidentally, I am glad that the Secretary of State is now present. There is a formidable housing crisis. Thousands of families have no accommodation of their own, and live with their relatives or friends, or, as we know, in bed and
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      breakfast accommodation. There is a huge waiting list of people who need to be housed. Many families in my constituency are housed in multi-storey blocks. They do not want to buy their flats, but they would like the opportunity to transfer to houses. That point has been made time and again to me and, I would have thought, to many hon. Members by their own constituents.
      Earlier, the Minister said that he wanted to nail the lie that tenant security was being undermined. But the security of many council tenants is certainly being undermined as a result of the Bill, because it is intended that a local authority should be able to sell to the private sector. It will be up to the court to decide and so on, but that will not offer much protection to those tenants. The Bill is obsessed with privatisation. For example, there is the clause that deals with the privatisation of council estates. I took a deputation to see the Under-Secretary of State and they were seen by civil servants. The Rosehill estate in Willenhall in my constituency is desperately in need of modernisation. At long last there is a chance of that estate being modernised. These are pre-war dwellings. Last summer, I went around with a senior representative of the Department of the Environment who saw for himself the conditions in which my constituent's live on the estate.
      To foot the bill of modernisation, the council is being effectively blackmailed into agreeing to sell off at least 20 houses and some open land on that estate before the necessary finance is authorised so that Rosehill can be modernised. That is an illustration of the Government's obsession with privatisation, and their desire to privatise many dwellings in the public sector.
      I see no reason why we should refrain from criticising, or why Labour candidates should not warn tenants up and down the country of the likely effect of the legislation in the near future. What is required is the opposite of what the Bill offers. Increased public investment in houses is required, and the opportunity once again for local authorities to be in a position to build.
      It has been estimated that fewer than 30,000 council dwellings will be started this year. I wonder whether the Secretary of State is proud of that. Many council dwellings need to be modernised and local authorities should have the financial means of carrying out the work.
      For all those reasons, Mr. Deputy Speaker. I believe that we are justified in opposing the measure. It will go through because the Government have their majority, but we shall do what is necessary. We shall tell the country what is at stake. I have no doubt at all that many people will be even more determined to vote Labour as a result of this measure.
      Mr. Marlow: I give the Bill my blessing. It is a tremendous Bill. It gives great hope and opportunity to many people who are not living in the best of circumstances. It gives them a better opportunity to buy their flats and to manage them.
      I thank my hon. Friend the Minister for the tremendous way in which he ran the Committee and the business this evening. I extend my thanks to the main protagonists on the Front Bench opposite the hon. Members for Norwood (Mr. Fraser) for Birmingham, Perry Barr (Mr. Rooker) and for Woolwich (Mr. Cartwright). It was the most positive and stimulating Committee on which I have had the pleasure to serve.

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      I am only sorry that the bad fairy had to turn up, with the spiteful remarks that he has recently made. I can assure him that this beautiful Bill will live and survive. If anyone is going to prick his finger it will be him.
      Mr. Simon Hughes: Following the blessing of the Bill by the hon. Member for Northampton, North (Mr. Marlow), if will be difficult to make excessive remarks.
      It was not for want of interest that the Liberal party was not represented on the Committee. It was a small Committee. My hon. Friend the Member for Woolwich (Mr. Cartwright) spoke for the alliance. He attended on every occasion, or on all but one occasion. He was a regular attender, participant and contributor. We pay tribute to him for that.
      Some things remain to be said. The Government came to office saying that they would make Britain the best-housed nation in the world. They have so fundamentally failed in their policy that the Bill will not do more than bring occasional improvement and hope to some people.
      There are good signs. People are beginning to accept and recognise the need for co-operatives, and, as I said on Report, we hope for more. Improvements have been made in relation to service charges. An amendment was passed on Report in relation to improvement grants for blocks of flats where work has so far not been possible. Those are certainly improvements.
      I hope, as the hon. Member for Norwood (Mr. Fraser) said, that before the Bill completes its passage through both Houses it will be able to accommodate something to amend the Housing (Homeless Persons) Act, which was introduced by my hon. Friend the Member for Isle of Wight (Mr. Ross) and which the judgment in the case of Puhlhofer v.Hillingdon Borough Council has shown to be defective.
      The Act does not give homeless people any security of decent accommodation in the way that it was thought it did until the House of Lords judgment.
      I end with a reflection which is very much a daily vision in a constituency such as mine. Unless the Government do
      556
      something that moves away from the two policies of privatisation and deregulation of housing and planning we will sadly see the creation of two nations. We need a much more serious attack than the Bill is providing.
      My constituency contains the London Docklands Development Corporation and the Southwark council area outside the LDDC. In one area we see people in depressing council accommodation, often in tower blocks, many of whom cannot be adequately housed. In the other area we see people enjoying the benefits of the deregulated docklands corporation, where properties are changing hands at exploitative prices for figures in excess of £175,000, grossly abusing the entitlement of many other people to a decent share of housing in London. It puts up the price of land and drives away people who have a right, because they are local to communities such as ours in the docklands, from the places that are their own.
      The result convinces me that the magic of the marketplace, as the former Minister responsible for housing used to call it, does not provide the answer. Only if people have control, participation and shares in their communities and housing, and in the planning of their areas in a democratic way, where everybody, no matter what his status or income, has an equal chance, will we begin to house our nation and plan for it properly.
      There are some good things, but the fundamental failure of the Government to address the malaise of the inner cities and beyond has not been remedied by the Bill. I regret that and hope that the Government realise their derogation and dereliction of duty. With every month that passes their administration causes problems for many areas of Britain from which they will find it difficult to recover.
      Mr. John Patten: At this stage I wish only to thank those hon. Members on both sides of the House who have said kind words about the ministerial team on the Bill. I would also like to thank those hon. Members on both sides of the House who improved the Bill so much in Committee and on Report.
      Question put and agreed to.
      Bill accordingly read the Third time, and passed.

Higher Education (NAB Report)
Motion made, and question proposed, That this House do now adjourn.—[Mr. Mather.]
10.42 pm
Mr. Mark Fisher: I seek a clear statement from the Minister about the position in which polytechnics and colleges find themselves in regard to their funding for 1987–88, the future of many of their courses and, above all I seek a clear statement of the number of students that will be admitted in that year. The fact that there is widespread confusion on these vital matters is a direct result of the Government's incompetent management and neglect of higher education in our country.
On Monday the Minister described education as being in
"creative ferment at all levels."
He admitted that that made it a "difficult period". What a euphemism. For "creative ferment" he should more properly have said chaos. To appreciate the extent of this crisis it is necessary to describe briefly the present state of higher education—the context in which the National Advisory Body's planning exercise for 1987–88 is taking place.
On Monday the Minister said:
"British higher education is among the best in the world".—[Official Report, 21 April 1986; Vol. 96, c. 72.]
I would agree in many respects. We certainly have some of the best teachers, best courses and best institutions, but our age participation rate is appallingly low at 13 per cent. Japan provides higher education for 20 per cent. of its young people and the United States provides higher education for 22 per cent. In western Europe only Portugal and Ireland have a lower proportion of 18-year-olds entering higher education.
In his reply the Minister may say that the fact that the number of students entering polytechnics and colleges has risen by 70,000 since 1979 is the Government's one single achievement in higher education. However, the Government have made higher education pay a very bitter price for that gain. They have not provided the additional money to educate those students. Indeed, expenditure on higher education has been cut by 10 per cent. in real terms. Britain is the only country in western Europe which is cutting expenditure on higher education. Every other country recognises that to meet the needs of industry, technology and the future they must expand higher education. This country is, however, reducing expenditure on higher education.
The ratio of staff to students has worsened in this country by 25 per cent. and expenditure per student has decreased by 20 per cent. Purchasing for equipment, books, library provision, crucial periodicals, support staff such as technicians and all the resources necessary to provide the high quality higher education, have been cut and are now critically underfunded.
The National Advisory Body, set up to advise the Government, clearly stated that no more savings could be made. That is the context in which the Secretary of State wrote to the Minister as chairman of the National Advisory Body on 3 February and said:
"I would like to invite NAB for its planning exercise to adopt (as well as the assumption adopted hitherto by the secretariat and the chainnan's study group), the assumption that the 1987–88 Quantum might show an increase of 3·5 per cent."
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Translated, that meant a shortfall of £23 million. The NAB secretariat went away and attempted to work out what this planning assumption of the Secretary of State would mean in practice.
On 4 April the secretariat wrote to the directors of polytechnics and colleges with their conclusions. These involve a 6 per cent. cut in student numbers in engineering, technology, construction, science, health, mathematics, business management and in design. They would also mean an 11 per cent. cut in modern languages and a 16 per cent. cut in humanities. Specifically, they would mean that the Rose Bruford college would close, in spite of a recent excellent report from Her Majesty's inspectorate. All humanities would cease at Newcastle, Brighton and north Cheshire polytechnics. At the north Staffordshire polytechnic in my constituency, modern languages would go, computing would lose 70 students and social sciences 116. Sunderland polytechnic would lose its civil engineering department and perhaps most damaging and most idiotic of all, Wolverhampton polytechnic would lose all of its engineering, cutting some 600 students over the three years and losing 35 staff. It is idiotic that that should happen in a town that is founded and based on engineering, and it is equally idiotic to cut a department in which the computer-aided design and computer-aided manufacture centre had recently received £70,000 investment from the National Westminster bank. That must be a crazy policy.
Everyone in this country believes that we should encourage computer-aided design and manufacturing: only this Government could have created circumstances which have led to cuts in that provision. In all, the total number of students entering polytechnics and colleges in 1987–88 would be reduced by 9,400 full-time equivalents—that is over 12,000 students in real, human terms who would be affected. What a farce!
Faced by the unanimous condemnation of the education world and the anger of parents and potential students, the Secretary of State and the Minister have done their best since then to dismiss the NAB's planning exercise. The Minister called it a "campaign of alarmism" and the Secretary of State more tersely called it "rubbish", "a single guess". However, the professional staff at the NAB have based the exercise on the Secretary of State's assumption, which he invited NAB to adopt. As the Secretary of State set the assumption for the planning exercise, it does not become him to disown it now.
I understand that the Minister is telling his colleagues and anyone else who will listen that the NAB should have produced more than one assumption that, as the letter said:
"it might be appropriate for NAB to adopt a range of assumptions".
Indeed, his next sentence in the letter of 3 February specifies the additional assumption that the Secretary of State had in mind—the one "adopted hitherto by the Secretariat". It did in fact adopt that assumption which allows for a cut of £42 million and 18,000 fewer students. Is that the assumption that the NAB should have sent to the directorate? Is that the range of options that the Minister is now saying it should have adopted? The Minister does not seem to be very keen to respond and it is no wonder because he was in the chair at the NAB committee meeting on 27 February when the central planning assumption was agreed. He will recall that one other person was there on that day—the Secretary of State. Both of them were in the room. They heard the

559
discussion. They knew the framework laid down by the board. It really is hypercritical of them to seek to dismiss the reality of that now.
The truth is that the Secretary of State and the Minister have bungled this planning exercise, just as they have damaged so many other parts of our education system. They are both zealots for cuts in public expenditure and they have delivered over education for the knife without a struggle. Then they seem to be surprised, or perhaps confused, when such cuts are made. They say, "No, it is not us; it is the directors of the polytechnics, the NAB". Nobody in Britain believes what the Secretary of State and the Minster say. Their hands are not clean. They are responsible for this assumption and the conclusions that run inexorably from it.
The Minister may well say that there was a further alternative for the NAB. It could have chosen to cut the unit of resource, the expenditure per student, still more. But that was never proposed at that meeting of 27 February, as I understand. But, as Mr. Clive Booth, the director of Oxford polytechnic and a former senior official of the Department of Education and Science has said:
"In polytechnics, spending per student is the lowest ever."
As the Council for National Academic Awards has said in a recent unpublished paper,
"There is little if any scope for further reductions in the resourcing of public sector institutions in England if the quality of courses … is to be sustained at acceptable levels."
Indeed the CNAA goes on to conclude that if the present resourcing policies are continued, it will have to choose between accepting lower course quality and withdrawing course approval. That is a stark choice between numbers and quality. No wonder what Mr. Christopher Ball, the chairman of the NAB, has said that cuts are inevitable if we are to maintain the quality of provision.
Tonight in this Adjournment debate we need to know who is right. Is it the CNAA and the NAB and almost everybody else in higher education who say that a reduction of £23 million in 1987–88—which follows from the Secretary of State's own assumption—will lead to either lower quality or to a reduction in students, or is it the Secretary of State and the Minister who say that this is rubbish?
The Secretary of State and the Minister have sought to avoid that question by saying that we should leave it until later in the year and that it will all work out in the negotiations, or, perhaps less honourably in his speech to the directors of polytechnics, the Secretary of State blames teachers in higher education for last year's pay award. That simply will not wash.
If the NAB and the CNAA are wrong, let the Minister answer five important questions tonight. First, what will be the number of students entering polytechnics in 1987–88? Secondly, what courses will be available to them? Thirdly, how many staff will teach those courses? Fourthly, what resources will they have to do that work? Fifthly, what unit of resource and range of teachers will be available?
The Minister may say that those are imponderables because they flow from the planning exercise, although it is a planning exercise which he himself set up. Nobody in higher education would advocate a return to the old system which was clearly indefensible, but surely the Minister can see that the present arrangements for the exercise are
560
fatally flawed. Decisions made in the autumn will not be conveyed to polytechnics until December. That will leave them six, or at the most nine, calendar months to effect those changes. It simply is not possible to make reductions on those scales without knowing before December what courses will be offered. They cannot be advertised honestly or put into effect.
Surely the sensible thing would be to adopt the recommendations of the Jarratt committee on the universities and opt for a three-year cycle of planning for higher education. I believe that the Jarrett committee on the public sector will also adopt that view, but, sadly, it is a view rejected by the Secretary of State's Green Paper. I urge him, as a constructive criticism, to think again to avoid such problems. If the Minister insists that this form of planning exercise, on a yearly basis, is the right method and if he insists that he will not give any undertakings tonight the British people will consider that he is playing games with higher education.
He will fuel the confusion and demoralisation which is already rife in higher education. Parents, students and teachers in higher education are angered by the present confusion and uncertainty. They want, and the country wants, better provisions for higher education and more secure, long-term planning certainties.
We could plan with such a certainty and deliver the skills our higher education is capable of delivering but which, at present, we are sadly lacking. Tonight is an opportunity for the Minister to repair some of the damage that has been caused since 4 April. That damage flows inexorably from the Secretary of State's letter to the Minister and the assumptions which he suggested that NAB should make. If the Minister cannot reassure people, higher education is in a parlous state. I do not believe that is the Minister's intention. This is an opportunity for the Minister to put some certainty into higher education and give us the planning base which we undoubtedly need.
10.55 pm
The Parliamentary Under-Secretary of State for Education and Science (Mr. George Walden): I am grateful to the hon. Member for Stoke on Trent Central (Mr. Fisher), for giving the House this opportunity to debate the planning exercise for 1987–88 now being undertaken by the National Advisory Body for Public Sector Higher education—NAB for short. Equally, I welcome the chance to discuss the planning of the public sector more generally.
The National Advisory Body secretariat's consultative student number proposals, which were circulated to institutions on 4 April, have, in particular, received extensive coverage in the press. Not all of that coverage has been careful to distinguish their status. That may not be entirely the fault of the media, since this is the second time this year that they have been invited by NAB to contemplate substantial reductions in intakes in 1987–88. The first time was in January when the putative reduction totalled 18,000 places. Now it is a more modest 10,000. This is all the more regrettable because of the inevitable anxieties to institutions, their staff and to students and parents that confusion about the Government's policies can cause. I am sorry that the hon. Gentleman, for rather transparent purposes, has chosen to try to muddy the waters further.

561
There are even better examples of this confusion than the hon. Gentleman's speech. On 8 April the Leader of the Opposition asked the Prime Minister:
"was the dispatch of a letter from the National Advisory Body committee to the directors of polytechnics a mistake, or did it not take place, or is it another fantasy?" —[Official Report, 8 April 1986; Vol. 95, c. 16.]
The answer is yes, it was a fantasy. I am the chairman of the committee in question and no such letter was sent. If the hon. Gentleman wishes to apologise on behalf of his right hon. Friend for misleading the House, I shall be happy to give way to him on this point.
Mr. Fisher: The Minister knows very well that the NAB secretariat sent a letter on 4 April to the directors of polytechnics and colleges. He has a copy of the letter.
I have copies of that letter, sent to several polytechnics. Surely he does not want to deny the fact that Christopher Bull, on behalf of NAB, sent out that letter?
Mr. Walden: I am saddened by that intervention, because it shows that the hon. Gentleman is not prepared to apologise on behalf of his right hon. Friend for misleading the House. and he also seems to be confused about the exact state of affairs. I hope that I can further enlighten him in the course of my speech.
The hon. Gentleman has been careful to avoid the most yawning pitfalls, but he has still not got it right—as we have just seen. I am glad to have this opportunity to set the consultative proposals by the NAB secretariat in context and, in so doing, to allay the anxieties to which I referred. To that end, I should first make clear that the proposals issued by the NAB secretariat are not Government decisions, nor reflections of Government policy.
The proposals are, in fact, the first results of a planning process and the work of the secretariat of the National Advisory Body. The NAB was established in 1982 in response to the need for some form of central planning of the maintained sector of higher education following the "capping" in 1980 of the advanced further education pool which shares the cost of local authority higher education between authorities. Its remit was, and is, to advise my right hon. Friend the Secretary of State annually on the disposition of academic provision within the sector and on the consequential distribution of the advanced further education pool between authorities in respect of their institutions providing advanced work. In 1985 that remit was extended to include the voluntary colleges. As part of its remit NAB conducts a major revision of academic and institutional plans every third year. The first review was in respect of the years 1984–85 to 1986–87 and was completed in December 1983. The second, on which it is now engaged, will cover the years 1987–88 to 1990–91.
It is axiomatic that an exercise of this kind, looking ahead over a period of three years, cannot foresee all eventualities and must perforce adopt some assumptions as a basis for developing its plans. So it is with the NAB secretariat's consultative proposals that were circulated just over three weeks ago, which were prepared with a view to the formulation of draft advice to the Secretary of State for consideration by the NAB board and committee later this year.
The proposals are based on a single assumption about the resources likely to be available for public sector higher education in 1987–88. It was on that assumption that the
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NAB committee invited the secretariat to draw up proposals which would restore the level of funding per student to its planned 1985–86 level.
Mr. Fisher: Will the Minister give way?
Mr. Walden: No. I believe genuinely that the hon. Gentleman has quite a lot to learn about this, so he must listen very carefully.
It is, among other things, because the committee believes that funding in 1987–88 will not fully compensate for previous inflation that a 7 per cent. reduction in intakes has, for the time being, been embodied in the secretariat's consultative proposals for 1987–88. In fact, the quantum for 1986–87 increased by 6 per cent., which included an allowance of 4·5 per cent. for year on year inflation, whereas I now note that the Government forecast for inflation in 1986–87 has fallen below 4 per cent. This all goes to show how hazardous these projections are and how misleading it can be to try to enshrine them in concrete.
I stress the contingency of all this, however, also because the actual resources available for 1987–88 will not be known until the autumn. Not until then will the NAB committee—I stress the committee—decide how to advise the Secretary of State about the number of students in aggregate who can be accommodated, not about the subject and institutional implications. At that juncture, as the NAB secretariat's letter covering the proposals itself notes, the committee will have to review the hypothesis used to date and, to quote the letter:
"may wish to consider other options."
The NAB normally tenders it final advice towards the end of the year, whereon the Secretary of State has normally announced his decisions by Christmas.
The hon. Gentleman has suggested that the existing assumptions about funding should be given particular credence because I, as chairman of the NAB committee, am a party to them. That is to misunderstand my position. I hope that that is not done deliberately. My colleagues on the committee, who comprise the chairman of the board and six councillors representing local education authorities, well understand that in addition to chairing their meetings I am also a Minister in my right hon. Friend's Department. I cannot, wearing my ministerial hat, compel the committee to reach any conclusion that it was not inclined otherwise to reach or, wearing my chairman's hat, commit my right hon. Friend to accepting whatever advice the committee may choose to put forward to him.
Mr. Fisher: Will the Minister give way?
Mr. Walden: No. If I could do either of these things, what would be the purpose of having a national advisory body?
Mr. Fisher rose—
Mr. Walden: I give way to the hon. Gentleman.
Mr. Fisher: Does the Minister dispute that the board acted on the assumption upon which it was invited to act by the Secretary of State in the letter that I specified earlier? The board projected the Secretary of State's assumption into the hypothesis that it worked out.
Mr. Walden: By referring to the board the hon. Gentleman has given a new stir to the muddy water that he has already created. We are not discussing the functions of the board. We are discussing the functions of the

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committee and its secretariat. I suggest only that the hon. Gentleman should continue to listen most carefully to what I have to say. Then he may learn how these things actually work.
It remains the case that the Government's position has been the same throughout. Both at the level of the NAB board, on which officials from my Department sit, and in the Committee we have pressed NAB to plan on the basis of a variety of funding assumptions.
The hon. Gentleman also sought to convict the Government of a disregard for the maintenance of quality. The hon. Gentleman deduces a threat to quality from the evidence of declining unit costs in the public sector since 1979. He asserts that the limit of what is an acceptable level of funding per student has now been reached and that the Government cross it at risk to the maintenance of quality.
Obviously the Government are watching very closely the relationship between funding and quality. We are by no means suggesting that the system is infinitely elastic, but there are important issues here about the relationship between resources and student numbers which go to the heart of what planning is about. The hon. Gentleman's charicteristically lavish prescription implied in his speech simply to spend more money does not even begin to address these problems. Perhaps, therefore, in the time remaining, I could take his education in hand.
The background to the fall in unit costs—11 per cent. across the system as a whole—often cited as an index of quality, is the sustained expansion of student numbers, and hence of access, which has occurred in the first half of this decade. Since 1979, the public sector as a whole has absorbed an increase in students of 27 per cent. In polytechnics alone the growth has been about 37 per cent. That is a formidable and impressive achievement. The orderly assimiliation of these additional numbers owes much to the quality of NAB's planning since 1982—and no one is suggesting that NAB always gets it wrong.
There is, however, no general evidence that it has been achieved at the expense of quality. That is because the resources necessary to sustain the expansion were largely already in place. Accommodation and resources which had been laid down in the 1970s in anticipation of student demand which either failed to materialise, or materialised at a slower rate than expected, were filled up only in the 1980s. The fall in unit cost is thus in practice a measure of the more efficient and intensive exploitation of spare capacity.
The proof of this is to be found in the performance of the student/staff ratio, which, across the system as a whole, has taughtened from 8·2:1 in 1979 to 10·8:1 in 1984, but still remains below the target of 12:1 established by NAB itself—I emphasise that—as a basis for its planning. Thus the National Advisory Body, in its strategy advice to my right hon. Friend the Secretary of State about higher education in the late 1980s and beyond, published in September 1984, judged, in the light of the views of Her Majesty's Inspectorate and the validating bodies, that the fall in unit costs was not in itself a ground on which it could argue for an increase in the funding per student. I do not accept, therefore, the hon. Gentleman's thesis that
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we are witnesses to a protracted attenuation of resources. One man's fall in funding per head is another man's efficiency saving.
Nor do my right hon. Friend or I accept—and this appears to be NAB's current thesis—that there is no further realistic scope for a more cost effective distribution of provision across the system. Within the public sector of higher education, the polytechnics as a group are now operating what is evidently a tight ship. The average polytechnic student-staff ratio in 1984–85 stood at 11·5:1, close to, though still below, the 12:1 target. I recognise that there is concern within some polytechnics about the stringency of resources and that this concern has played its part in the NAB committee's decision to accord priority to sustaining a particular level of funding per student—the unit of resource. However, I remain sceptical of the invariable relationship which the unit of resource presupposes between funding and student numbers: namely, that each student comes at an average cost and that, for every rise or fall in the real level of funding, access should be increased or diminished commensurately.
A recent paper by the Council for National Academic Awards, to which the hon. Gentleman has referred and which was submitted to the National Advisory Body, encapsulates my own doubts in stipulating that the relationship is not a mechanical one. Common sense surely confirms that judgment. How can the unit of resource hold good as a description of the relationship between resources and numbers when a significant proportion of the system's costs are attributable to its buildings and other facilities which are relatively inelastic to demand? Thus I note that the CNAA paper, which is far more complicated than suggested, though estimating that the present resource level may create difficulties for the maintenance of quality in the longer term, also implies that current funding is above the resource level necessary in the short term. In other words, across the system as a whole the existing infrastructure is equal to the demands now placed on it.
I particularly regret the pretext which dependence on the unit of resource supplies to those unwilling or unable to scrutinise how the system might be better organised to make resources go further and to sustain quality. The efficient allocation of places and resources is not only the key to orderly planning but is NAB's job and fundamental to the partnership between Government and local authorities which NAB embodies and which has worked well a number of times.
It is undeniable that there is overcapacity to be discerned in the system. By contrast with the efficient polytechnics, the student-staff ratio elsewhere in the local authority higher education sector stood at 9·6:1 in 1984–85. That is indicative of substantial spare teaching capacity. I think that not only the taxpayer and ratepayer but those institutions currently experiencing financial stringency have a right to ask why that spare capacity might not be rationalised and resources freed to flow to those parts of the system which are under presssure. If I were the director of a polytechnic which had played its part in the expansion of access in this decade, I should ask that question insistently.
It is my firm belief that we do ourselves no service by turning our back on these complications, and I am sorry that the hon. Gentleman chose to do that. I do not doubt the sincerity of the directors of individual polytechnics

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who have expressed to me concern about resources. I have talked to a number of them. I was interested that the hon. Gentleman mentioned Wolverhampton, because I visited the polytechnic there when the local collaborative project which involved the Westminster bank was being launched. I had a chance on the spot to calm the excessive fears that had been aroused.
I do not dissent from the proposition that our investment in public sector higher education should be such as to build on existing strengths and to maintain quality. I must ask the hon. Gentleman to apply his mind to realistic judgments on educational economics. The arguments
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about the maintenance of quality and building on existing strengths will not carry conviction unless and until it can be shown that existing resources are being used cost effectively. I hope that what I have said makes it clear that there is some way to go—I would not exaggerate how far—before we can truthfully say that. In the meantime—I stress this—
The Question having been proposed after Ten o'clock and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at twelve minutes past Eleven o'clock.

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

Stansted Airport: Rail Link
Baroness Burton of Coventry: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government on what date approval was given to the scheme concerning the rail link to Stansted Airport submitted to them by the British Rail Board in November last; and what is the present position.
The Parliamentary Under-Secretary of State, Department of Transport (The Earl of Caithness): My Lords, we are currently considering the British Railways Board's submission for a rail link to Stansted Airport and hope to announce a decision shortly.
Baroness Burton of Coventry: My Lords, is the Minister aware that that reply is quite disgraceful, and if his brief is no better it is unbelievable? Will the Minister please explain to the House why, if the British Government still wish to have a rail link to Stansted—which I doubt—and if British Rail still wishes to supply that link, why it has not pursued its application? Will the Minister further explain to the House why the debate which was adjourned until 6th March, because it was talked out, has since then been deferred to 13th March, 20th March, 27th March, 10th April, 17th April and today? Will the Minister tell the House whether the Government, as they have obviously run into trouble, are afraid of not getting their business through in another place; or have they plucked up their courage to take the matter forward tonight in the Commons?
The Earl of Caithness: My Lords, the noble Baroness raises a number of points which she also raised on Monday, 21st April. My reply to her rather amusing, repetitive account about a Private Bill is that it is not a government Bill. The rail connection to Stansted is a matter for a Private Bill and it is common for it to be put down on the Order Paper weekly. A decision as to when it should be heard in another place is up to the Chairman of Ways and Means and not to the Government.
Baroness Burton of Coventry: My Lords, is the Minister aware, first, that I am not amused, and, secondly, that I thought his reply the other night was a disgrace? Will he please understand that those of us who have worked for months on this matter resent this type of reply? Will he please address himself to what I have said? I have asked him why, if the Government wish this Motion to proceed and if British Rail wishes it to proceed, the matter has not been dealt with and
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has been deferred from 24th February up to today. Finally, can he say whether it will be deferred again tonight?
The Earl of Caithness: My Lords, it will not be heard tonight, because the Chairman of Ways and Means, not the Government, is the person responsible for selecting when the Second Reading should continue. As the noble Baroness will understand, the rail link has two parts to it. It has the investment part which we are considering, and it has the statutory part which has to go through both Houses of Parliament. That at the moment is in another place. A number of points were raised on the statutory part and these are being considered by British Rail with certain people in the locality and with the Government.
Baroness Burton of Coventry: My Lords, the House is very kind, but do noble Lords realise that I am being tried beyond endurance? Will the Minister please address himself to one particular point? Why does British Rail not proceed with the application which it made to the House on 24th February?
The Earl of Caithness: My Lords, as I have certainly tried to explain to the noble Baroness and to the House, British Rail is pursuing its application. As I said, a number of points have been raised since Second Reading and at Second Reading in another place. These affect the investment appraisal and we are discussing it with British Rail. I think it is proceeding as quickly as possible.
Lord Boyd-Carpenter: My Lords, although my noble friend very properly declines to comment on procedures in another place for which he has no responsibility whatsoever, can he nonetheless tell your Lordships whether it is the Government's policy that it would be desirable to establish a rail link to the new airport?
The Earl of Caithness: My Lords, I am grateful to my noble friend for that question. Yes, it is the Government's policy that a rail link is a desirable feature of the development of Stansted, but on the condition that it is economically viable in accordance with the usual terms.
Lord Mellish: My Lords, is the Minister aware that the Chairman of Ways and Means in another place, as he will know, is the Deputy Speaker? If time is to be found by the Chairman of Ways and Means, what is needed is more than a wink and a nod. What is needed is a push from the government managers.
The Earl of Caithness: My Lords, as my noble friend Lord Boyd-Carpenter said, I am not conversant with procedure in another place, and therefore I shall not comment.
Lord Underhill: My Lords, will the Minister give an assurance that this matter is not being held up because of the question of the external financial limit? If that is the problem, will that be adjusted accordingly to allow this matter to proceed?
The Earl of Caithness: My Lords, I can confirm to the House that we wish the matter to proceed as speedily as possible, and we are awaiting further discussions with British Rail.
Lord Tordoff: My Lords, that is not an answer to the noble Lord's question. As the noble Lord, Lord Boyd-Carpenter, suggested, do the Government not understand that Stansted cannot go ahead in any viable way unless there is a rail fink? Will the Government give an assurance that they will put their weight behind British Rail having a proper rail link into Stansted Airport?
The Earl of Caithness: My Lords, the noble Lord, Lord Tordoff, asks me a question which he asked me earlier in the year. The future of Stansted does not depend on a rail link. Similarly, there is no rail link to Heathrow at the moment.
Baroness Burton of Coventry: My Lords, will the noble Earl allow me to ask him (on a point of fact) whether he is aware that I do not remember the first time I put down a Question on this matter, because it is rather a long time ago? But is it not correct that on that Question the Minister himself described the scheme that was put forward by British Rail as being financially viable? If it was financially viable then, why is it not financially viable now? But the Minister gave a very lukewarm reception to the question as to whether or not the Government wished to proceed with the rail link.
The Earl of Caithness: My Lords, I can only repeat that the Government wish to proceed with the rail link, provided that it is economically viable within the terms. As a result of the Second Reading in another place, a number of points were raised which affect the appraisal and therefore we are still considering it.
Lord Underhill: My Lords, does the noble Earl not recognise that it is not just the viability of a rail link; it is the viability of an airport which is the important consideration? Does he also remember that there is a rail link to Heathrow by London Regional Transport? That was constructed irrespective of the point which he has raised in connection with the rail link to Stansted.
The Earl of Caithness: My Lords, the noble Lord is absolutely right to remind the House of the Underground rail link. The noble Baroness's Question referred to a British Rail link, so that is why I answered as I did.
Lord Annan: My Lords, is the noble Earl aware that it is widely believed that the pressure groups, which failed to get their way when it was agreed that Stansted should be developed, particularly those in the North-west of England, are really trying to fight a desperate rearguard action against Stansted being a good airport? But may I go further and ask the noble Earl this question? Clearly, the Channel tunnel is bound to depend on a rail link. Are we going to be told in that case that it is purely a matter for British Rail to decide whether or not it is economically viable? Surely there are certain rail links which must be made available if the project is to be a success.
The Earl of Caithness: My Lords, I think that we should all like Stansted to become the successful airport which it can become. It does not necessarily depend on having a rail link. It would be a tremendous advantage if it did, but the rail link has to be financially justified.
Lord Alport: My Lords, is my noble friend aware that there are many people in Essex who do not want Stansted to be a successful airport at all?
The Earl of Caithness: My Lords, I am aware that there are a number of people who do not want a lot of good things to happen.
Lord Dean of Beswick: My Lords, is the Minister aware that the noble Lord who spoke previously is not from the North-West?
The Earl of Caithness: Yes, my Lords. Having had long discussions in this House with the noble Lord, Lord Alport, I realise that he comes from Essex.

Motor-Cyclists: Driving Practices
3.10 p.m.
Lord Moran: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will take steps to put an end to the widespread practice in London whereby motor-cycles overtake lines of traffic by travelling on the wrong side of the white line.
The Parliamentary Under-Secretary of State, Home Office (Lord Glenarthur): My Lords, overtaking by crossing the white line at the centre of the road is a criminal offence only when it involves reckless, careless or inconsiderate driving or the contravention of road markings such as a double white line. The Metropolitan Police take steps to prevent and detect such offences as part of their general responsibility for policing London's traffic.
Lord Moran: My Lords, I am grateful to the Minister for that reply. Do I understand that to mean that motor-cyclists who cross a single white line are committing no offence? If one drives on any evening from this House to Albert Bridge one sees a large number of motor-cyclists crossing the white line. Is this not a very dangerous practice and does it not put them and other people at risk? I am surprised if it is acceptable to the police and to the Government.
Lord Glenarthur: My Lords, all the information is available to the noble Lord in the Highway Code. I assumed all along that the noble Lord was referring to the white line in the centre. If a person overtakes safely, it is a matter for him.
Earl Cathcart: My Lords, does my noble friend agree that accidents involving motor-cyclists are unlikely to decrease until motor-cyclists can be persuaded to conform to the normal rules of traffic

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control and to desist not only from the practice described in the original Question but also other practices such as weaving among moving vehicles in built-up areas?
Lord Glenarthur: My Lords, I agree with my noble friend that weaving can be dangerous. The Highway Code makes it clear that when traffic is moving slowly in queues motorists should not change lanes to the left in order to overtake. I am well aware of the point my noble friend makes. With regard to numbers of injuries, the commissioner has informed us that 66 motor-cyclists were killed in London in 1985, a decrease of 34 on the 1984 figures. The figures are coming down.
Lord Wigoder: My Lords, did the noble Lord say that it is not an offence to cross a single continuous white line in the middle of the road? If it is not, what is the difference between a continuous white line and a broken white line?
Lord Glenarthur: My Lords, I refer the noble Lord to the Highway Code. Page 21, paragraph 85, says:
"You must not overtake:—if you would have to cross or straddle double white lines with a solid line nearer to you".
There are then two other conditions which the noble Lord will no doubt find interesting.
Lord Underhill: My Lords, the noble Lord said that the Metropolitan Police take appropriate action in such cases. Can he tell the House how many successful prosecutions there have been in the past 12 months or the past two years? Although this is a dangerous offence for motor-cyclists, are not many car drivers also guilty of the offence?
Lord Glenarthur: My Lords, the figures available centrally on the offences of recklessness, carelessness and inconsiderate driving do not distinguish cases involving overtaking. In 1984, the latest year for which figures are available centrally, eight motor-cyclists were convicted in London of failing to comply with double white lines. In England and Wales as a whole the figure was 726. The same technical rules as apply to cars exist in the Highway Code.

Unemployment Figures
3.14 p.m.
Lord Dean of Beswick: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what conclusions they draw from the latest figures issued on unemployment.
The Secretary of State for Employment (Lord Young of Graffham): My Lords, the latest figures, which were released yesterday, show a fall in the number of people without jobs and seeking work of about 100,000 between 1984 and 1985. These estimates of unemployment from the Labour Force Survey compare with an increase of about 160,000 in unemployment according to the monthly claimant count over the same period.
Lord Dean of Beswick: My Lords, I am grateful to the Secretary of State for his reply. How does he relate his Answer today to the headlines in the press a couple of weeks ago—from parts of the press that are normally very favourable to the Government—that said "Rise in unemployment—the biggest for four and a half years"? Does this not indicate that, though the Government and the noble Lord as Secretary of State may alter the criteria for calculating the number of unemployed, the real situation is one of continuing deterioration in a very dangerous fashion? When will the Government and the Secretary of State realise this, stop indulging in self-congratulation and do something about it?
Lord Young of Graffham: My Lords, the very first thing I would say is that neither I nor the Government have in any way altered the basis of calculating the figures. What has happened, and happened this time for the first month, is that there was a delay of two weeks in order that there could be a more correct check of the monthly claimant count. That is what happened recently. I resent the charges made in another place that anyone has fiddled the figures. Accuracy, surely, is something everyone in your Lordships' House would wish to see.
Secondly, there are many ways of counting unemployment. The figure that the noble Lord was referring to was the claimant count; that is the figure announced by the holder of my office each month. There is another way, which is used by many other countries and which we have in the Labour Force Survey. The figure which was published yesterday—that is why I was replying to the Question which asked about the latest figures on unemployment—showed something very surprising. In a period in which the claimant count went up by 160,000, according to the Labour Force Survey the number of people without jobs and seeking work fell by 100,000. The reason is simple. The Labour Force Survey defines as unemployed all those without work and looking for a job. The claimant count is only those receiving benefits.
Lord Elliott of Morpeth: My Lords, has my noble friend noticed some quite accurate figures produced recently? Has he noted that in the financial year just ended English Estates achieved in the North-East of England, which certainly has its unemployment problems, a 20 per cent. increase in lettings of factories and workshops, which represents just over 500 new places of employment and 4,500 new jobs? Has he further noted that on Monday of this week the twelfth Japanese factory attracted to the North-East of England by government policies and encouragement was opened? The same policies are revitalising the town of Consett, until recently wholly dependent on steel production.
Lord Young of Graffham: My Lords, no one would endeavour to diminish the very real problems of the North-East of England in looking for new jobs to replace all the jobs lost in the declining industries. But, on the other hand, we do not often enough give credit to the efforts that are being made in the North-East to find new employment, to the enterprise being shown and to the success that these endeavours are producing.
Baroness Seear: My Lords, does the noble Lord agree that it is almost impossible to draw sensible conclusions from any one set of figures, and therefore questions of this kind must be of very limited usefulness?
Lord Young of Graffham: Yes, my Lords.
Lord Barnett: My Lords, while no one would wish to accuse the noble Lord of deliberately misleading the House by giving incorrect statistics, he will know well that you can do a great deal with statistics. Would it not have been fairer to give the real figures? The underlying fact is that the seasonally adjusted figures of unemployment show an increase. Would it not therefore have been simpler and more honest if he had simply told the House that on present economic policies unemployment will continue to rise?
Lord Young of Graffham: No, my Lords. The last thing that I would wish to do is to mislead your Lordships' House. What the noble Lord is asking me to do—and I shall gladly do it—is to say that, seasonally adjusted, the claimant count shows an increase and has shown an increase each month. But I was pointing out the difference between the claimant count, which is a total of all those receiving benefit, and the Labour Force Survey, which is an estimate of all the people without jobs and seeking work. The Labour Force Survey definition is the definition which is adopted by the United States of America in looking at unemployment. There are those around who say that that provides a better measure of unemployment.
Lord Jenkins of Putney: It is a guess, my Lords.
Lord Dean of Beswick: My Lords, will the Secretary of State tell the House how many times since this Government took office in 1979 they have altered the criteria for calculating unemployment? Why has that been done? Is it not a fact that despite all the figures that are given, there is still a dangerous and underlying increase in the number of adult unemployed?
Lord Young of Graffham: My Lords, I shall be glad to answer the noble Lord's question if he will put it down on another occasion. It is a very different question but one that I shall be quite happy to answer. Secondly, I am not sure that there is an underlying increase in unemployment. I gladly admit that there is an underlying increase in the claimant count. I look at the other evidence before me and it shows a different picture. Just as unemployment cannot be solved by any one, simple solution, nor can we explain away unemployment by one set of figures.
Lord Stoddart of Swindon: My Lords, is the Minister aware that since 1979 the number of changes in the criteria has amounted to six? If those changes had not been made, then the figures would now show 3,800,000 unemployed. That is the stark fact of the matter. I do not want to be unkind to the noble Lord, but when he was appointed we had great hopes of him. In fact, we expected him to do something real and constructive to bring down the level of unemployment. He has failed to do that and we are disappointed in him.
Lord Young of Graffham: My Lords, I am very grateful that the noble Lord does not wish to be unkind to me, but let me tell him to have faith. He will see that the policies that this Government have been following, and in particular the policies of the past few months, will do more than anything else towards dealing with the terrible problem of unemployment.
We must be very careful about not jumping to conclusions around the country on one set of figures alone. Of course the claimant count is a convenient measure. I will not for one moment attempt to decry that the claimant count is a measure that all accept and adopt in looking at the level of unemployment. However, if one looks at the labour force survey—and no one in your Lordships' House would decry the definition of unemployment as meaning those who are without jobs and looking for work—one finds a very different position. I will have a copy of that survey placed in the Library.
The Earl of Onslow: My Lords, will my noble friend the Minister confirm that we have the highest percentage of employed people per head of population in this country than in any other part of Europe? Also, will he give some estimate of the effect of the black economy on unemployment figures in the more prosperous southern and eastern parts of the United Kingdom?
Lord Young of Graffham: My Lords, I am happy to say that 1 million new jobs have come into being since March 1983. I am happy to say also that we are experiencing faster employment growth in this country than in any other country in the European Community. Indeed, I remind the House that France, with a diminishing working population, is still showing a fall in employment. We have a fast-growing working population. Also, we give 65 per cent. of all adults of working age a job. The figures for France and Germany are 60 per cent. and 59 per cent. respectively. However, I must fail to give your Lordships any information about the black economy.
Lord Molloy: My Lords, does the Minister not agree that one simply cannot tell a man who has a family and who has been unemployed for a year or two how much worse matters would have been were he a Frenchman, a German, or an Italian? Is one to tell such a man that 1 million jobs have been created when 4 million people as well as him have not had one of them? All the juggling with figures really makes people who are out of work angry. It increases their despair.
Is the Minister further aware that a number of American economists have been writing in financial newspapers in this country with an indication that the largest contribution to the creation of jobs in their country and to the diminution of unemployment there was state enterprise along similar lines to that created by Franklin D. Roosevelt during the last period of massive unemployment in the 1930s? The Government have done many things, but why do they not have the courage at least to try that approach in attempting to solve the plight of 4 million of our countrymen and women who are unemployed and who face a more miserable situation month after month?
Lord Young of Graffham: My Lords, the one thing that will not help anyone who is unemployed in this country is the preaching of despair at him day after day after day. If there is one thing that I resent, it is those people who go round saying that there is no hope, no opportunity, and no chance. There is. We will work our way out of the problem. There is no simple solution but hard work. I doubt very much whether anyone in authority in the United States would advocate Franklin D. Roosevelt's line of state works to get unemployment down in any other country.
Lord Winstanley: My Lords, will the noble Lord explain to the House how he accounts for the totally different picture produced by the two sets of figures that he has explained?
Lord Young of Graffham: My Lords, part of the answer is that the account figures show that about 40 per cent. of those claiming benefit were not looking for work during the week of the survey. I do not know the explanation for that; but the definition of unemployment in the labour force survey is simply those out of a job and looking for work. The claimant count is simply a measure of those claiming benefit. Neither of them are perfect and neither are absolutely accurate.
Lord Stallard: My Lords, does the noble Lord not accept that, stripped of all the presentational procedures that he outlined in his statistical information, the crucial point is the one that the Minister mentioned a few questions ago; the seasonally-adjusted figure still shows an increase. That indicates that unemployment is still on the way up. The trend is upwards; how does the Minister justify that?
Lord Young of Graffham: My Lords, if it will give comfort to the noble Lord for me to admit that the claimant count, seasonally adjusted, is increasing then I gladly do so because that is true. I was asked in the Question what the latest figures on unemployment show. Not wishing to mislead your Lordships' House, I have therefore referred to the labour force survey.

London Boroughs Grant Scheme
3.26 p.m.
Baroness Birk: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are considering making an order under Section 48 of the Local Government Act 1985 to limit the London Boroughs Grant Scheme expenditure in respect of voluntary bodies and arts organisations.
The Minister of State, Department of the Environment (Lord Elton): Yes, my Lords. The Government's decision will be announced in due course.
Baroness Birk: My Lords, how does the Minister reconcile that reply with the statement made by the Arts Minister on 14th November in another place, and repeated in this House, in which he stated, when
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explaining the rundown in abolition replacement money, that:
"As time goes on, local authorities which have been relieved of GLC and MCC precepts should be able to increase their share".—[Official Report, Commons, 14/11/85; col. 700.]
Does that not indicate a difference of opinion in that respect between the Secretary of State for the Environment and the Minister for the Arts?
Furthermore, does not the use of arbitrary capping of that kind undermine the duty placed on boroughs under Section 48(10) of that same Local Government Act, which places on boroughs a duty to pay due regard to the needs of Greater London? That is being entirely swept aside.
Lord Elton: My Lords, the noble Baroness apparently anticipates both the result of the consideration that we are giving and the level of the absolute figure that we would put into an order if we were to put in an order. I repeat that we are considering whether or not there should be a limit for the reasons that the provision for the limit was put into the Bill and which I explained when we put it there.
Baroness Birk: My Lords, then I must ask the Minister: what are the reasons for talking about putting in an order at this moment when the £27 million has been agreed and accepted, and the draft order that has been sent out, as the Minister knows, does not make any provision for a review but provides for £27 million irrespective of inflation or increased needs, just to continue until another order is put forward? What are the reasons for that?
Lord Elton: My Lords, the figure of £27 million is that arrived at by the London Section 48 scheme known as the Richmond Scheme in its budget, and it was the obvious figure on which to consult. The purpose of having the provision in the Act was to provide against the contingency that a minority of boroughs, after they have arrived at their budgets, might have imposed upon them by a two-thirds majority, as required under the Act, a figure that they would find unacceptable after the beginning of their financial year. The purpose of consulting is to see whether it is necessary or appropriate so to do.
The noble Baroness may perhaps not be aware that the rules that the Richmond Committee has set for itself do not allow for a variation of its budget between one year and the next. However, those rules could of course be changed.
Lord Jenkins of Putney: My Lords, in considering this order will the Government take particular note of the arts support organisations, which seem to have fallen out of consideration in this matter? The Government have made some attempt—to what degree we shall discover in due course—to replace the GLC and the metropolitan counties in so far as arts organisations directly are concerned. However, there are arts support organisations—I take, for example, not the Theatres Trust, with which I am concerned, but the British Theatre Association—which have very much fallen by the wayside. They are already underfunded. The BTA, for example, has lost its Arts Council grant and its GLC grant and the whole

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organisation is in very difficult financial circumstances. Will the Minister look at those organisations which seem to have fallen by the wayside in the course of this reorganisation?
Lord Elton: My Lords, of course we shall look at the context in which the order, if there is to be an order, is laid. We have not yet decided to lay an order. I point out that the responsibility for funding the voluntary sector London-wide now rests with the Section 48 scheme, known as the Richmond scheme, and I also point out the the total volume of money available to the voluntary sector in London is likely to be between £50 million and £60 million, which compares closely (does it not?) with the £56 million funded by the GLC in the financial year 1984–85.
Lord Underhill: My Lords, I hope that I have not misunderstood the noble Lord. Did he say in the final part of his previous answer that if an order is made it will not vary from one year to the next? Surely some consideration will be given to inflation. Will that at least be included in the order if the Government decide to issue one?
Lord Elton: My Lords, I am grateful to the noble Lord for his misunderstanding because it enables me to put right something which I do not think I said at all but which has been, as it were, imputed to me. The duration of the order is simply until the next order and a new order can be made and proposed at any stage, not merely at the end of the financial year. What cannot at present be changed during a financial year is the Richmond budget itself and that is because of a decision by the Richmond Committee as to how to conduct its own business. It is not a matter for government decision.
The Earl of Bessborough: My Lords, am I not right in thinking in relation to the supplementary question put by the noble Lord, Lord Jenkins of Putney, that these arts support organisations come to some extent within the remit of the Department of Education and Science?
Lord Elton: My Lords, I think it depends on what aspect of their activities one looks at.

Business
3.32 p.m.
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Lucas of Chilworth will, with the leave of the House, repeat a Statement which is to be made in another place on BL.
It may be for the convenience of the House if I announce that the Committee stage of the Gas Bill will be adjourned at approximately 7 p.m. for approximately one hour, and that during this adjournment the Draft Child Resistant Packaging (Safety) Regulations will be taken and the House will again be in Committee for the Surrogacy Arrangements (Amendment) Bill.

Business of the House
The Lord President of the Council (Viscount Whitelaw): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debate on the Motion in the name of the Lord Wells-Pestell set down for 30th April shall be limited to 5 hours and that Standing Order 35 and paragraphs 10 to 13 of the Rules for the Conduct of Short Debates shall apply to the debate with the substitution of "5 hours" for "2½ hours" and "25 minutes" for "20 minutes".—(Viscount Whitelaw.)
On Question, Motion agreed to.

House of Lords Offices
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move that the Second Report from the Select Committee be agreed to.
Moved, That the Second Report from the Select Committee be agreed to.—(Lord Aberdare.)
The Report was as follows:
1. Library
A report from the Sub-Committee for the year 1985 was laid before the Committee.
2. Staff of the House
A report from the Sub-Committee was received.
The Committee agreed the Sub-Committee's recommendation for the creation of two general assistant posts in place of one clerical officer and one attendant and authorised the scale of pay proposed.
3. Insurance for Lords
The Committee approved an increase in the personal accident insurance cover for Lords whilst on Parliamentary duty.
4. Parliamentary Delegations
The Committee approved provision for the payment of revised subsistence allowances.
5. Revised Scales of Pay
The Committee confirmed the application of the following Civil Service memoranda to applicable staff of the House of Lords:

CM/722—Starting pay on transfer to a new substantive grade;

CM/725—Restructuring of Legal Groups;

CM/727—Unified grading at Principal level;

CM/726—Clerical Officer scale of pay.

6. Hansard Reporting Staff
The Committee authorised the payment of revised attendance fees for temporary reporters and transcribers and the revision of charges for agency typists,
7. Uniform Allowances
The Committee approved a revision of the allowances paid to Clerks at the Table, the Gentleman Usher and Yeoman Usher of the Black Rod for the provision of court dress and in the uniform allowances paid to Doorkeepers.
8. Doorkeepers
The Committee approved an application by the Civil and Public Service Association to be granted representative capacity for House of Lords Doorkeepers.
9. Superannuation
The Committee were notified of the following awards made under the House of Lords Staff Pension Scheme:

(a) Pension and lump sum to Mr. D. J. Huxley, MBE, M.M., Principal Doorkeeper, who retired on 17th January 1986.

(b) Pension and lump sum to Mrs. J. M. Harris, Bar Attendant, who retired on 20th December 1985.

(c) Preserved pension and lump sum to Mrs. F. M. Martin, Senior Clerk, who resigned on 11th November 1985.

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(d) Preserved pension and lump sum to Mr. G. C. C. Donner, Personal Assistant to the Lords of Appeal, who resigned on 15th November 1985.

(e) Preserved pension and lump sum to Mr. T. O. Ferguson, Head Chef, who resigned on 28th February 1986.

(f) Preserved pension and lump sum to Miss C. P. Farrell, Waitress, who resigned on 31st October 1985.

(g) Preserved pension and lump sum to Mrs. J. E. F. Boddington, Cook, who resigned on 24th December 1985.

(h) Widow's pension and lump sum benefit to Mrs. M. E. Fowler, valid nominee of C. F. Fowler, former Doorkeeper, who died on 8th December 1985.

(i) Short service payment to Miss C. J. Lawton, Reporter, who resigned on 28th February 1986.

(j) Short service payment to Mrs. J. M. Kittou, Cleaner, who resigned on 31st August 1985.

(k) Notional transfer value in respect of Miss E. M. McInnes, Library Clerk, who transferred to the House of Commons on 1st October 1985.

(l) Notional transfer value in respect of Mr. J. Bannister, Clerical Officer, who transferred to the Treasury on 1st October 1985.

On Question, Motion agreed to.

Gas Bill
3.34 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Belstead.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Lord Ezra Lord Ezra moved Amendment No. 1:
Before Clause 1, insert the following new clause:
("Commissioners of Gas Supply.
.—(1) The Secretary of State shall appoint three officers to be known as the Commissioners of Gas Supply, with one of the three officers appointed as Chairman of Gas Supply (in this Act referred to as "the Chairman") for the purpose of performing the functions assigned to the commissioners by this part. These Commissioners shall be responsible respectively for: tariff consumers; contract consumers; and gas purchases and energy efficiency. The appointments of officers as commissioners shall be approved by the appropriate committees of each House of Parliament.
(2) The appointment of persons to hold office as commissioners shall initially be for terms of three, four and five years. Subsequent appointment of persons to hold office as commissioners shall not be for a term exceeding five years; but previous appointment to that office shall not affect eligibility for reappointment.
(3) Subject to subsection (2) above, the commissioners shall hold and vacate office as such in accordance with the terms of their appointment.").
The noble Lord said: This amendment raises a fundamental issue in connection with this important Bill. As we know, the Bill concerns the transfer of a public monopoly to the private sector. It raises issues of policy which we have considered only once before, in relation to British Telecom. The gas industry, however, is more of a monopoly than British Telecom, so the issue is even more serious.
On this side of the Committee we should have been happier had this important matter been subjected to greater debate on the major issue involved. Indeed, in the newspapers this debate continues. This very morning in the Financial Times there is an article entitled "Why ownership is not everything". The
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author of the article, Mr. Michael Prowse, said that it would have made more sense to
"reform competition policy first and then embark on a controversial phase of privatisation".
He went on to say:
"The other main worry concerns the weight of the existing and proposed independent regulators. Organisations like BT, British Gas and Thames Water are both powerful and skilled political lobbyists. Is it really plausible to expect tiny regulators like Oftel, the telecommunications watchdog, and the planned Ofgas and Ofwater, to keep tabs on their charges for more than a short initial period?".
That view as expressed in this morning's Financial Times underlines the amendment now before the Committee. The concern is that if we have to proceed with this massive transfer of a monopoly—and everyone admits that for gas it operates very successfully, but nevertheless, it is a monopoly—from the public to the private sector this must be done with the very greatest care.
There has been much experience gleaned in the United States and there are many public utility commissions operating there with powers which go far beyond those which are proposed for the Director-General of Ofgas. Therefore, it seems relevant at the beginning of this Committee stage that this fundamental issue should be put. If we are to have this transfer undertaken without, as we feel, full public debate on all the issues having first been completed, at the very least we must be assured that there is an effective regulatory body.
What Clause 1 of the Bill proposes is that a Director General of Gas Supply should be appointed. Later in the Bill certain broad functions are assigned to him, particularly in Clause 4. If we try to find out what sort of organisation he is going to have to support him we need to refer to page 64, Schedule 1 paragraph 4, which states:
"The Director may, with the approval of the Treasury as to numbers and terms and conditions of service, appoint such staff as he may determine".
We know what the Treasury's instinct is in all these matters. What indication are we likely to have that the director will have at his disposal a sufficiently substantial staff to do the massive job that he has to undertake?
So it is the contention of these Benches that if we are to proceed with this important measure of legislation, we ought to spell out in the Bill more effectively how the regulatory body is to be organised. After all, we are putting at risk a very large section of the public who for several years have become used to the operation of the gas supply industry under its public organisation.
There will now be a transformation of this body into one with much wider powers and much greater freedom of operation while still retaining its monopolistic stature. This is the nub of the issue. I should like to recommend to the Committee that in going through the Committee stage of this important Bill we should bear in mind that it is the interests of the public above all else that we should try to safeguard. We must see that in order to safeguard the consumers' interests there are sufficient arrangements in the regulatory system, in the consumer representation (which will be dealt with later), in the safety standards, in the obligations to supply and in pricing policy.
But at this stage and in this amendment we are concerned with the regulatory body. When we were debating a similar body in regard to the Telecommunications Bill a number of noble Lords from these Benches expressed concern that the body was too small to do its job. In the event there has been much concern about the way in which the pricing aspects of the telecommunications legislation have been operated. Surely we must learn from experience. There is widespread concern that Oftel is not a strong enough body to do its job. Let us not repeat the mistake in connection with Ofgas.
We feel that in the light of the very important issues involved in the transference of a monopoly from the public to the private sector the proposals made in this amendment are indeed fairly modest. We are trying to obtain some assurance that there will be a regulatory body which will address itself specifically to the problems which are involved in this new Bill. We think that instead of the appointment of a single director general, there should be three commissioners of gas supply, one of whom should be the chairman, and that these commissioners should be endowed by Parliament with specific responsibilities. One commissioner should have a specific responsibility for tariff consumers. That involves all the domestic consumers of gas in this country. It is surely right that there should be a high-powered member of the regulatory body with suitable supporting staff who will concern himself with the 16 million private consumers of gas.
Then there are the contract consumers, who are the people taking large quantities of gas in business and in industry. Time and again in this Chamber we have debated the need for energy prices to industry to be kept as low as possible. There is a need for a commissioner who will concern himself with the supply of gas to the commercial and industrial sectors.
The gas industry has now and will continue to have considerable freedom of action in negotiating terms, conditions of supply and prices in this market, but under its new guise this freedom will be very much greater. I think we can say that we all have confidence in the existing members of British Gas; but this is legislation which is intended to last for at least 25 years, and when we are legislating for a quarter of a century we need to be assured that each segment of the market will be fully safeguarded by the constitution of the regulatory body. Therefore we recommend that one of the commissioners should be concerned with matters affecting contract consumers.
The third commissioner should have the responsibility for gas purchases. British Gas in its present guise—and it will continue to be so in its future guise—is a dominant factor in the purchase of gas from the North Sea. This situation needs to be watched with great care. Hitherto it has been the Government themselves who have intervened when the gas industry, rightly or wrongly, wished to augment its supplies by buying in from certain Norwegian sources. But in future how will this be watched over in the interests of the consumer? So we feel that one of the commissioners should be concerned with this matter as well as with the related subject of energy efficiency.
We add to this recommendation the proposal that:
"The appointments of officers as commissioners shall be approved by the appropriate committees of each House of Parliament".
We put this in because we think that these appointments are of prime and crucial importance. My noble friend Lord Diamond will speak on this aspect later on.
In the subsequent subsections of this amendment we indicate that the commissioners should hold office for different periods of time so that there can be some degree of overlap when they change over.
In this Committee we are raising one of the most fundamental issues concerning this Bill; namely, that in transferring a most important public monopoly into the private sector we are entering uncharted seas. The very least that we can do is to make sure that the regulatory body is strong enough to cope with that situation. It is not our opinion that the proposals contained in this Bill concerning the regulatory body go far enough and therefore we make this proposal to strengthen that body. I beg to move.
3.45 p.m.
Lord Stoddart of Swindon: The Labour Opposition have thought very long about this amendment. We have studied it very closely indeed and we have rolled it around in our minds because it introduces a new concept and one which I think the Committee should treat very seriously indeed.
For ourselves, after we considered it, we decided that it was an amendment which deserved our support. Indeed, we believe that it deserves the support of all the Members of the Committee. I hope that we shall see later how much support it has received. The noble Lord, Lord Ezra, is quite right. At Second Reading we explored just exactly how weak the regulatory system would be under the Bill. In this Bill we are setting up a regulatory authority which will have a single director. We do not know what he will be paid and therefore we do not know what status he will have vis-à-vis the chairman of the gas board. We do not know how many staff he will have to carry out what are, it is quite true, the meagre duties that he will have under the authorisation.
We are under the Bill buying something of a pig in a poke. We do not know exactly what sort of fellow we are going to appoint. What we do know is that this man is going to have to deal with a privatised gas industry that will have perhaps one of the most powerful and able chairmen of an industry, whether nationalised or privatised. That will be a job in itself. Apart from that, the gas board itself is split into various disciplines. There are members of the board who are responsible for each item of the gas business. Here we have a proposal that a single director should be able to challenge, to oversee and to regulate every single part of a gas business that will, in fact, be controlled within British Gas plc by several people. I contend that we are immediately putting such a man at a grave disadvantage. What is more, he will be the single individual under fire from every quarter—from the public, from Parliament and from the gas board itself. He will have no one to support him.

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I believe, therefore, that the amendment attempts to address and to redress the problem, and that, in large measure, it succeeds. We shall have commissioners who will be responsible for the various important parts of the gas business. As experts in their own right, working and meeting together, they will be able to a much greater extent to look after the public interest, not only the interest of the domestic consumer but, also, as the noble Lord, Lord Ezra, said, that of all consumers of gas. We believe this to be a sound idea.
The Secretary of State has already made plain that he does not think much of regulation by commissioners. He said, when appearing, I believe, before the Select Committee on Energy, that he had considered the American system, that he had looked at the regulatory bodies within that system and that he had come to the conclusion that they did not suit us. They were, he said, bureaucratic. Frankly, this Bill is bureaucratic enough. In any event, the Secretary of State, who has said that he wants the least possible regulation, would say that anyway, would he not? If he wants weak regulation, he has ensured that there will be weak regulation through Clause 1 of the Bill. The amendment seeks to improve that regulation. We shall certainly support it.
My noble friend Lord Williams of Elvel, who has some expertise in this matter—indeed, he was the chairman of the Price Commission—will have something to say at a later stage based on the experience that he has gathered. But, certainly, so far as I am concerned, the amendment has attractions not only for the reasons that I have already mentioned but also because it contains the safeguard that the appointment of officers as commissioners shall be approved by the appropriate committees of each House of Parliament. That really does appeal to me and, indeed, to the Opposition. I am afraid that all too often there is an overweening arrogance in government that often leads to the appointment of people who, were they required to go before a committee of each House of Parliament, might not be appointed.
The noble Lord, Lord Ezra, who moved the amendment is of course a man of experience. He has been chairman of a nationalised industry. The noble Lord has proposed that appointments of this sort should now be subject to some control by each House of Parliament. That is a new and radical step. The fact that the noble Lord, who has been chairman of a nationalised industry, has proposed it adds significance. What the noble Lord is saying is that if he were now being appointed, he would not mind going before a committee of each House of Parliament. That is something of which we should take note. If the noble Lord, Lord Ezra, a man who has been a successful leader of a nationalised industry, does not mind going before a committee of each House of Parliament, why should anyone else mind? That is a particularly attractive part of the amendment.
I do not wish to delay the Committee any longer. Obviously, we wish the Bill to make progress, though it will make progress, let me assure the Committee, only in so far as we have the opportunity to improve it. For, by heaven, it is a Bill that needs a lot of improvement! Nevertheless, I shall not seek to delay the Committee any further at this stage, because my
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noble friend Lord Williams will also have something to say about the amendment. I conclude merely by saying that it is a good amendment that deserves the utmost support.
Lord Diamond: I should like to pursue what has already been started and follow exactly the theme established by the noble Lord, Lord Stoddart, in his concluding comments. This is indeed a most important Bill. It is a most difficult task on which we are now embarked. I hope that your Lordships realise that we are charged with the responsibility of doing something that I find immensely difficult. We know what the Government want. They want to increase the efficiency of gas production. They want to increase the protection of the consumer. They propose to accomplish this by withdrawing all the accountability within the present set-up—the accountability to Parliament, to Government and to Members of Parliament, who can put questions to Ministers—as well as the encouragement that exists in the present arrangements for producing gas at the minimum cost to the consumer.
We are charged with the responsibility—the Bill and the principles embodied in it having already had a Second Reading—of trying to make some sense out of the Bill and trying to give effect to the Government's wishes. Your Lordships may say that this is an impossible task. How can one make more efficient a public monopoly simply by transferring it to a private monopoly? How can one increase protection for the consumer by withdrawing all the arrangements for his protection, with the exception of one central committee, that already exist? Nevertheless, that is our duty.
4 p.m.
Why do we find ourselves in this plight? I am perhaps in a special position to answer the question. It is because I take the view very strongly that it is proper for us to follow completely the convention that once a government Bill has received the support of another place, no matter the circumstances in which that other place is able to produce a majority, it is not for this Chamber to attempt to override the general principles of such a Bill and the wishes of the electorate as spoken by their representatives in another place. They are the elected Chamber; we are not. Because of that, we could not vote against the Second Reading of a Bill which has within it this immense internal inconsistency. We had to sit silent, and we have now the duty, as it is Committee stage, with a Bill which has passed Second Reading in this Chamber of trying to make sense of it. That is why I say this is a most difficult task.
We are dealing with an industry of such size and importance that I find it difficult to grasp the immensity of it. If one talks about business on a very large scale what comes to mind immediately is ICI. It simply does not compare. As we all know, gas heating is an important element in the industrial cost of a vast number of our products and exports. It enters into the cost of living of 16.5 million people in this country. It directly affects their standard of living, comfort and health. I was a Treasury Minister for a very long time but I cannot visualise 16.5 million as an objective total. One has to relate it to something or other. I know that when I was a Treasury Minister I took off half a

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day a week to play golf in order to keep myself fit to do my duties. I used to play for half a crown. I knew what that was; I could visualise half a crown. But who can visualise 16.5 million people? Just think of the whole of London, and all the towns and cities throughout Great Britain that are involved. This is the problem which we are now charged to deal with in this Bill.
The figures are quite overwhelming in their size and importance. British Gas, as we know from the figures they have given us, at March 1985 employed approximately 93,000 people directly. British Gas had net assets employed of over £16.5 billion. Gas sold was valued at £6.25 billion. Those are such enormous figures that I do not think I would be wrong in suggesting to Members of the Committee that it is beyond our mental capacity to visualise them. We can only say that this is of enormous size and importance. In terms of the industry of our country and the livelihood of our people very few things could be of greater importance.
We now have this enormous task of trying to make gas cheaper to the consumer and produced more efficiently. The Government propose to do it by appointing one chap, with a grand-sounding title, to stand up to the chairman and board, these powerful and experienced people who have been carrying out their responsibilities for many years, supported by enormous numbers of executive staff and others—those directors, that chairman, with their power with all those customers behind them—and say, "Really, you ought not to have done that, ought you?" It is quite ridiculous to think that one person can stand up to all that.
Perhaps I may give Members of the Committee evidence with regard to that. Perhaps I may be forgiven for giving a recollection of what happened during the course of the Industrial Relations Bill argument which, as noble Lords know, went on for a considerable time in 1972 and 1973 and in which I was closely involved. At one period there was a legal point at issue. I had counsel's opinion which did not agree with the view of the noble and learned Lord the Lord Chancellor. He was good enough and courteous enough to invite me to a meeting with him where it could be discussed. I duly attended that meeting. When the door was opened, who was there to be courteous enough to receive this one single representative of the Opposition? It was of course the Lord Chancellor. He was accompanied by Sir Geoffrey Howe—who I think at that time was Attorney-General—and on each side of the table there were at least six other people. My recollection is that there were at least 20 people there to receive and listen to my point of law just in case it happened that the weight of opinion would affect the issue. That was a simple case of dealing with a point of law. It was felt appropriate that in case there had to be an argument with the noble Lord who had the responsibility of leading for the Opposition at that time, it would be no bad thing if the numbers were somewhat disproportionate.
If Members of the Committee will cast their minds back to their ministerial experience they will find that the question of numbers attending any such meeting were always taken into account. I can only regard it as a compliment that on that occasion they thought it
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appropriate to produce perhaps 20 people to deal with one simple soul who was not even a lawyer.
I return to the reason that I am bothering Members of the Committee with that recollection. It is to make this point. Will one chap, with the grand title of Director General of Gas Supply, be able to stand up to the chairman, the board, the executives, the middle management, the lower management and all the huge strength that they gather from being suppliers of 16·5 million customers, with all the huge strength that they get from having these massive numbers of employees? Will he be able to stand up to that amount of pressure? If Members of the Committee convert this into the circumstances of the present time they may feel disposed to agree with me that the present chairman, an able, powerful and efficient man, could eat such an individual for breakfast and not notice the difference—and still require his toast and marmalade in the ordinary way!
So what can we do but strengthen, and strengthen considerably, the protection that is being envisaged in the Bill, and try to do it in a way the Government would have done if they had thought about it a little more, if they had been concerned a little more with the principles they had expressed, and if they had given themselves time to think about matters other than cash at the end of the line. As my noble friend Lord Ezra has explained, based on the depth of his great experience, which is not exceeded by that of anybody in the Committee, we are proposing something very much stronger. In fact, we are proposing a commission with, to be on the modest side, only three members to begin with.
As the amendment makes clear, the commissioners will have separate responsibilities, as they are described. My noble friend has referred to the reason for that division. That they are good categories I accept completely, because he has the experience of this, but just let us pause for a moment and think of the size of the responsibilities of each individual commissioner. Each individual commissioner is going to have a job which is not only man-sized but giant-sized. One commissioner is to be responsible for tariff consumers. The number of tariff consumers is nearly 16 million. The tariff consumers are the ordinary men and women who pay their meter charges for their gas, and, as I understand it, the non-tariff consumers are the people who make special arrangements because they consume much larger quantities of gas. We are going to have just one commissioner charged with the responsibility of looking after some 16 million customers. That is a man-sized job in itself.
We are going to have one commissioner responsible for contract consumers, the customers who come and argue about each individual arrangement they are making for the supply of gas—quantities, prices, peak loads and all the rest of it. They argue because gas enters so importantly into the price of what they are making and trying to sell either here or abroad. It does not matter which, because if you sell it abroad it is an export and if you sell it here it is the avoidance of an export. The important thing is to sell it to someone who is going to use it, and in order to sell these products as cheaply as possible they want their fuel content, their gas content, to be as cheap as possible. They have gone to the expense of establishing

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enormous installations—enormous in size and enormous in cost—to use the gas to make whatever their final product is, and each individual one is going to enter into a contract with the gas company in order to get the cheapest and most efficient supply of gas that he can.
We are told that the number of contract customers is something like 580,000; that is, 83,000 customers who are industrial and half a million who are commercial, who together make the total number of contract customers. Each one is an individual wanting an individual supply and wanting special arrangements and special terms. I am suggesting to the Committee that that too is very much a man-sized job.
4.15 p.m.
The third category is gas purchases and energy efficiency. We know what happens about the cost of gas supplied. Whatever the gas company finds it has to spend on its purchases is regarded as a proper element in its cost, and it will add that on to its overheads before charging a customer, be it a tariff customer or not. Whatever enters into its cost is a proper element in arriving at the final price, even under the complicated arrangements in this Bill. So what has the regulator, the person who is protecting the nation's interest, to do to satisfy himself that the cost incurred was the proper cost? Nobody is charging anybody with dishonesty, but it concerns not only the proper cost but the minimum cost. Could the cost have been reduced by having some totally different way of getting supplies? I am not a gas man; I do not know. All I do know is that it is common to every single business that the cost of what they buy depends on how they go about their buying and how they go about conceiving what are their necessary supplies in order to arrive at their final product.
The expenditure they incur in research in order to answer that question is often enormous. It is a very difficult task indeed to monitor gas purchases and energy efficiency. We know already that an enormous amount of expenditure is incurred in trying to make a gas light burn to a maximum heat at the minimum volume of gas. It makes a tremendous difference if you can get 10 per cent. extra heat, or 10 per cent. lower volume consumed to produce the same amount of heat. Every one of those engaged in this important task of research is looking at that oversimplified example of the importance of what the amendment describes as energy efficiency. So to have one person only to monitor gas purchases and energy efficiency is surely loading that man with the maximum that he can reasonably achieve.
We have, therefore, three commissioners each of whom, as I have demonstrated—and if I have been too casual or too short in order to save time I shall be glad to explain more fully why I am totally convinced of this—has a fully man-sized job. As a minimum, there should be three top-grade experienced men charged with the responsibilities of together constituting a commission. Of course, as we all know, three members of a commission are a much stronger team than the sum of three individuals. They will act as a team and will stand as a team when doing their job.
Is this very reasonable, very modest and very cost-conscious proposal an original one? Indeed, it is not.
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There is nothing very original in the world these days and there is certainly nothing very original in this proposal. As noble Lords who are familiar with this area will know only too well, every single state in the United States has a commission of this kind to look after its public utility companies. Every state grants a private monopoly, as we would call it. The United States, as the supreme private enterprise country, does what it would regard as appropriate: it ensures that for every monopoly there is a commission monitoring and regulating the work, the prices, the quality and the services of the utility. In not one single state is one man appointed with this grand title. We are talking about gas suppliers whose volume of business is much smaller, who have fewer customers and whose effect on the standard of living, supplies and exports, is much smaller. This private enterprise country is an example to all noble Lords who are sitting on the Tory Benches of how private enterprise should be run. This is a country which is accepted by noble Lords and Baronesses opposite as being the ideal of private enterprise, but every single state has a commission very similar to the kind that we are proposing.
Therefore, there is nothing original about this idea; it is a proven idea. I am particularly glad to be able to refer to the United States because, as we know, each state can do what it likes; each state can do the job differently from, say, a neighbouring state if it wishes. One state could decide to have a commission, whereas another could say that it will have one chap who will have a grand title and who will do the job on that basis; that state may decide to give that person an office in a central town or city of the state so that everyone is kept happy, no matter how far away they are from him; and therefore in those circumstances he will be able to do the job. However, they do nothing of the kind. Each state is apparently satisfied that if a utility is organised as a private monopoly, it must have the protection of a commission.
Therefore, there is nothing original here; we are putting forward a proven system for protecting the trader, the consumer and the householder where, as this Bill creates, we have a private monopoly.
Baroness Macleod of Borve: I hate to interrupt the noble Lord's Second Reading speech, but I wonder whether he is aware that British Gas sent an inspection team to America to see exactly what the Americans were doing, and that team returned with a completely opposite view from the one put forward by the noble Lord to the Committee this afternoon.
Lord Diamond: I am aware that the present chairman of the gas board, who is not wholly hostile to this Bill, has taken the view that what the noble Baroness, Lady Macleod, says is quite right. If I may say so, I am not aware that, in speaking to the first amendment in a Bill, I am making a Second Reading speech. I was not aware of that at all. I am not concerned with the principles, except to explain them, as I have explained them, and to explain why we are committed to them and why it is necessary for us to give effect to them. I take the view that, once the other place has passed a Government Bill, we must accept the principles of that Bill as embodied in the Second Reading. At the time of the Second Reading we made

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no objection, although noble Lords must not imagine that there was not a great temptation to make an objection. I stuck firmly to my guns that that is the convention; that it is in the best interests of your Lordships' House; and that is why the Second Reading was agreed without any vote of any kind.
I am dealing purely with this very important amendment and trying to explain why I take the view that it is a minimum variation of the scheme proposed in the Bill and that all of us ought to support it. It goes a long way towards helping the Government to achieve their stated principles. They are not our principles: they are the Government's principles. The Government want more efficiency and protection for the consumer. I suggest that this can be done only by adding to and strengthening many of the proposals contained in this Bill, which is our function, our duty and our responsibility at the Committee stage.
I was about to explain why the amendment states:
"The appointments of officers as commissioners shall be approved by the appropriate committees of each House of Parliament".
In the interests of avoiding duplication my noble friend Lord Ezra said nothing about this aspect at all and asked me to deal with it. I was invited by my noble friend to explain to the Committee why the amendment contains the words:
"shall be approved by the appropriate committees of each House of Parliament."
First, let me deal with the principle of that proposal, which again is nothing new.
Lord Sandys: Can the noble Lord tell the Committee whether he is now addressing the second amendment or the first one?
Lord Diamond: I am addressing the first amendment, Amendment No. 1. I hope that the noble Lord has the same Marshalled List as I have. I am addressing myself to Amendment No. 1 which, as the noble Lord knows, has three subsections, and I am dealing with the last sentence of the first subsection. I have not yet reached the second subsection. Therefore, I do not know quite how the confusion arose in the noble Lord's mind; but I am sure that it was my fault for not having made clear at the start that I was dealing only with subsection (1).
In subsection (1) it says:
"The appointments of officers as commissioners shall be approved by the appropriate committees of each House of Parliament."
I hope that the noble Lord has found that in his Marshalled List and is following it. Again, although this is not a very original suggestion, it is somewhat original in your Lordships' Committee. So we are faced with a very original proposal; we are faced with a proposal to improve the efficiency of supply of gas and the protection of consumers by creating a private monopoly. That is a very unusual proposal indeed.
In order to try to bring some sense to this matter, we have to think as hard as we can (as we did on this occasion) of some way in which the commissioners themselves will know that they have the support of Parliament behind them. This is a question which I
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know will appeal to all your Lordships because it deals specifically with the issue of the extent to which our Houses of Parliament, including your Lordships' House, should exercise their responsibility.
As the Committee knows, where officers of this kind are being appointed in the States to do the parallel job to the one to which I have referred it is usual for them to be examined and cross-examined by the appropriate Senate Committee. That is their normal practice. That is their right before such a person is appointed. If he does not satisfy the requirements that they feel he should have in order to be appointed to the job. he is not appointed.
4.30 p.m.
That is point No. 1. We need to be sure that we are appointing a person of adequate ability and experience to each of the commissioner's jobs. Therefore we must make sure that he is interviewed and examined by those who have the feel for this kind of thing, and not rely wholly and exclusively on one man, the Secretary of State. We have to be sure that these individuals have a relationship with Parliament and that if they feel they are being unduly pressurised by the Secretary of State, they have reason to believe that they have the support of Parliament behind them. Thus they will not feel as lonely as they otherwise would.
If, notwithstanding that this is a regular procedure and that it has logic wholly behind it, your Lordships still feel doubtful about it, I invite you to consider the history of what has happened. We are not on new territory, we are on existing territory. We are talking about appointing individuals similar to the regulator of Oftel; we are talking about appointing a similar individual as the regulator of Ofgas.
Is it not the case that there has been expressed considerable criticism of the way in which the first office holder of this kind has carried out his duties? If that is the case, ought we not to be even more careful before we repeat the previous error of leaving the Bill unaltered and therefore allowing the customer, the consumer, to be treated in a way in which he would not have been treated had British Telecom not been privatised?
This is a serious point that we have to consider. In my view it is necessary for the commissioners to go through what is perfectly normal procedure in private enterprise utilities; namely, the procedure of ensuring that officers who have this kind of enormous, overriding, country-wide responsibility shall be approved by a committee of each House of Parliament.
Why do we refer to the "appropriate committees"? I can explain that a little more easily to your Lordships' Committee if I may have a glass of water. As the Committee knows, because it has already been discussed in another place, there is there a committee called the Select Committee on Energy, which is precisely geared to do, and is capable of doing, this very job. Select Committees come and go. While they are there they are ideally suited for this purpose, being all-party committees, with the major part of the membership representative of the Governments side. There is no question, therefore, of the Opposition getting any benefit out of all this. It is purely for the

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protection of Parliament, and is by no means for the advantage of the Opposition.
I am making the purely non-party point that a Select Committee of the other House, known as the Select Committee on Energy, should have the responsibility of interviewing a proposed nominee for one of these commissionerships. But of course it is the case that that Select Committee might be changed in the future as it has been changed in the past. Therefore, it has been thought wiser to cover this possible change and any possible eventuality by referring to the "appropriate committees" instead of a particular committee. Of course if the Government say that the term "appropriate committees" is a little loose and that they would accept the amendment if it were more closely defined, we should be only too happy to listen to their closer definition, or to introduce ourselves at a later stage amendments which would meet that quite reasonable objection.
The amendment refers to,
"appropriate committees of each House of Parliament".
So far I have referred only to the other place. In this House we have several committees which might do the job. We have the sub-committee of the Select Committee which deals with European legislation. It might do the job; your Lordships' Committee might consider it as being the appropriate committee for these purposes. Alternatively, we have the services committee and the house committee, which are familiar with appointments and interviewing people and considering their fitness for jobs. But I think your Lordships' Committee will agree that rather than tie it down to one particular named committee it would be better to leave it to the good sense of the House to refer the proposed appointment to the appropriate committee.
Therefore, this amendment proposes that the commissioners shall be approved in what is an absolutely normal manner in the United States by the appropriate committees of each House, those committees having on them a majority supporting the Government of the day, and therefore enabling the Government to get their way at the end of the day. That concludes, rather briefly, my remarks on subsection (1) of the amendment.
I now come to subsection (2) about which I have not said one word so far. I would remind your Lordships' Committee that this refers to the period for which the commissioners shall, in the first place, be appointed. The proposal is, as a variation from what is proposed in the Bill, that they shall be appointed initially for terms of three, four and five years. The logic of that needs little explanation. My noble friend Lord Ezra has already referred to it.
The subsequent appointments would be for a term not exceeding five years. Therefore, we would have the great advantage, which the Government have totally overlooked and completely neglected, of seeing that there was continuity of experience and wisdom with no gap in the responsibilities and the way in which those responsibilities were carried out by the commissioners. We have repeated what the Government have provided; that previous appointment to the office shall not affect eligibility for reappointment.
I hope that the Committee will have been good enough to bear with me while I have endeavoured to explain the usefulness and helpfulness in the Government's terms of this short amendment against the background of the enormous task which rests on the Committee's shoulders and which cannot be ignored of carrying through our responsibilities as the Upper Chamber to try to do what the Lower Chamber was prevented from doing; that is, enabling the Government's policies in terms of greater efficiency and more protection for the consumer to be effective. I hope that I have helped the Committee to understand the purpose of the amendment.
Lord Elliott of Morpeth: It seems a very long time ago that the noble Lord, Lord Ezra, in moving this amendment said that the intention of the Bill was to give the gas industry greater freedom. That is what privatisation means, as I understand it.
Before my noble friend responds to this amendment I should like briefly to express what I am sure is the concern of many besides myself. If the idea of the Bill is to give the gas industry greater freedom, what is this greater freedom intended to do? As I am sure many of us see it, it is greater freedom for the gas industry to compete with other fuel industries; it is greater freedom for the gas industry to consider the needs of its consumers. I am sure that it seems to many others, as well as to me, a contradiction if we are to have this heavy commission (which has been somewhat heavily illustrated to us today) added as an extra bureaucratic body over the head of the gas industry and possibly another bureaucratic layer which other fuel industries do not know. I find myself very unhappy indeed about this amendment and I shall seek to oppose it.
Lord Bruce-Gardyne: I sometimes had the feeling listening to the noble Lord, Lord Diamond, that he thought what he said three times was true, or perhaps one should say 33 times. I share the concern that he expressed about the possible gastronomic activities of Sir Denis Rooke, but I must admit that I have always doubted whether a regulatory body, however contrived, was likely to prove an effective substitute for genuine competition. That is why I made it quite clear on Second Reading that I regretted we had not taken the opportunity on this occasion to achieve genuine competition within gas distribution and supply.
Looking at this amendment one feels rather like the great Duke of Wellington. One does not know what effect it will have on Sir Denis Rooke but, my goodness, it certainly terrifies me! What we are asked to do under this amendment, as I understand it, is to establish three commissions, three watchdogs: one to look after the tariff consumers, one to look after the contract consumers and one to look after supply and what is described as energy efficiency. From that one can deduce that each watchdog will spend most of its time biting the other watchdogs. Furthermore, it appears that one of them is to be appointed a chairman watchdog, and so presumably he would have to devote his entire attention to biting the other two watchdogs to keep them in their place. The one who had to look after gas supplies as well as energy efficiency would presumably have to do a fair amount

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of biting, as the two concepts obviously and demonstrably will frequently be in conflict.
Lord Diamond: May I—
4.45 p.m.
Lord Bruce-Gardyne: I hope that the noble Lord will allow me to continue because I do not want to detain the Committee for more than a moment or two. We have had quite a long time on this amendment, as I am sure he will agree.
Perhaps the aspect of the proposition advanced by noble Lords opposite that I find most scaring of all is the suggestion that these appointments should be vetted and cleared by the appropriate committees of Parliament. I can see clearly what would flow from that. With whom would these bodies be staffed? They would be staffed with former Members of another place and present Members of your Lordships' House. They would no doubt be eminently qualified for the job but they would be there to convince these Select Committees that there would be a role for them one day in this great new quango organisation.
The noble Lord, Lord Ezra, was deeply concerned about the reference in Schedule 1 to the Treasury. I am relieved to see the Treasury there. I do not want to have some enormous body—which I suspect, let us face it, will not be much of a substitute for competition anyway—spending money on a grandiose scale, appointing one commissioner after another, each to see what the other is up to and stopping him from so doing. I am only too delighted to see that the Treasury is there to ensure that this body is maintained on a modest scale. It will have a modest role, and so it might as well be maintained on a modest scale.
Finally, the noble Lord, Lord Ezra, referred, quite properly and in particular, to the need to ensure that the Gas Corporation did not abuse its monopsony position in the purchase of gas supplies. I agree with him entirely, but the best way to make sure that that monopsony position is not abused (apart from dismantling it, which would be my preference) is to ensure that there is genuine freedom to export so that the suppliers of gas from the North Sea can have an alternative choice of markets and we can tell that the Gas Corporation is purchasing its supplies at a genuine market price. That is infinitely better than any commissioner or any system of regulation. Therefore I hope that when we reach my amendment to Clause 62 in due course I shall enjoy the fullhearted support of the noble Lord, Lord Ezra, and his friends.
Lord Sandys: I oppose this amendment, as do my noble friends on this side of the House, for a number of reasons; most particularly this is a major philosophical divide between both sides of your Lordships' Committee on the role of this Bill. The answer to both the noble Lords, Lord Ezra and Lord Diamond, is contained in the Government's White Paper which we have before us, Cmnd. 9759, on page 9, paragraph 17. This refers to the contract market. It says:
"The contract market will be subject in the normal way to competition law and the legislation provides for complaints to be taken up by the Gas Consumers Council".
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One of the three wise men that the noble Lord, Lord Ezra, proposes is to be concerned with the contract market. In the White Paper it is felt strongly on this side of the House that the normal processes of law will operate. My noble friend has just referred to the situation which so frequently occurs when three wise men are appointed with special responsibilities; the responsibilities overlap. This may well happen because in a complicated market this often overlaps and gives rise to a clash of responsibility. I feel that the Government are absolutely right in concentrating on a single role.
Both the noble Lord, Lord Ezra, and the noble Lord, Lord Diamond, waved the numbers at us, the 16 million private consumers whom we on this side are naturally delighted to support and to consider very carefully indeed. Both efficiency and safety go hand in hand in British Gas, hand in hand in the awards which British Gas have won since 1975. Their track record is excellent, their scale of operations is excellent, and it may be valuable to recollect that among these 16 million private consumers there were, in the year 1984–85, no less than 14,800,000 service jobs undertaken; so it is almost covering the entire market. That is a very considerable undertaking and, I should have thought, a source of confidence for the consumers and confidence for the Government in proceeding with the situation as they outline it.
Lord Whaddon: I appreciate what has been said about the noble Lord worrying too much about bureaucracy. My view of the prospect facing our consumers is somewhat different. I had the great pleasure of accompanying the noble Lord, Lord Bruce-Gardyne, to Romania a few months ago—Romania the country where roamed in legend the great blood-sucking monster, Dracula. When this gigantic monopoly, which up till now has operated, very efficiently as a public servant, is handed over to a public limited company whose main duty will be to work for its shareholders, I have this vision, this nightmare, of the company turning into a Dracula, getting its teeth into the 16 million consumers and sucking the blood out of them.
It is against this nightmare that I think that we are quite right to consider very carefully the need to provide some protection for these 16 million potential victims. The Committee will remember a brilliant speech by the noble Earl, Lord Stockton, a few weeks ago during which he made that unforgettable remark about the danger of selling off the family silver. Not every family has family silver, but every family has a stove and I plead sincerely with the Government to watch their own position here. It is one thing to sell off the silver of a few people, but if they damage the family stove—which applies to every family—their own prestige will be gravely in danger.
One aspect of the gas industry which I have not yet heard mentioned but which is certain to arise more and more in the public mind is the increasing complexity of the technology. The noble Lord, Lord Diamond, in his intervention referred to the efficiency of gas consumption and the need for correct pricing; but all our industries, including gas, are in a period of new technology. Increasingly gas stoves, which only a few years ago were very simple indeed, now have

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electronic devices which control the time at which the clock goes on and off and automatic timing. If one of these goes wrong, the whole system goes wrong. Yet the new company will be responsible for marketing vast numbers of such devices and that will have a great impact on the standard of living and the comfort and convenience of the consumers. How those new devices operate will be of vital interest to every family in the country.
I should like to outline a little difficulty which occurred over the last 12 months with regard to a case of which I am personally aware. A family bought a new gas stove, having been tempted by an advertisement in the gas showrooms. It was a wonderful price for a wonderful new model which could do so many things which the old ones could not do. The stove was fitted rapidly and the money taken immediately, of course. But the following Sunday when the housewife needed to use the stove for several hours instead of for a five-minute test the temperature kept on rising and rising until, on reaching for the controls, she burned her hands.
Naturally she got in touch with the gas board who sent round a fitter. He rapidly diagnosed that one of the controls needed extra grease on it and he saw to this. But within three days the trouble recurred. The fitter came back three times, after which it became necessary to call in an inspector. In the next three weeks the family had four visits by a total of three or four people. Alas, that was not sufficient. The gas board concluded that there were queries concerning the design of the stove and, after several more weeks, called in the manufacturers. The manufacturers immediately produced documents which showed that they had constructed the new stove according to the rules aid down not by a commission of the House of Commons but by the European Commission—very much more distant, very much more unapproachable and very much more complex. Because they were able to demonstrate that their new device had been approved by the European Commission they disclaimed all responsibility.
Weeks and months of delay followed. The burners on the stove were replaced. Still the problem persisted. It was so simple; and yet the family had to go without meals because of a basic fault in the design. After 12 months it was agreed that the whole stove must be replaced and that representations would have to be made to the European Commission as to the efficiency of their supervision. Eventually that was done.
What followed a month later?—a bill for a replacement stove. Three months later it turned out that the computer system run by the gas council was not proof against human error. After threats to cut off the supply for non-payment it was eventually proved that the bill had been paid 18 months before; and, after 18 months of agony and stress the fault was finally put right and the family at last had an efficient stove. A very small fault had taken up 18 months of stress and oceans of time—and this against the background of a gas board which was set up as a public service.
Are we really going to hand over this giant monopoly to a public limited company without being absolutely certain that the consumer will be given instant attention where necessary? I am very sad to say I
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that experience with British Telecom is not encouraging. Following the privatisation of British Telecom my own experience has been that it has a very strange idea of private industry and how it should operate.
I have been in private industry all my life. I am used to cultivating the goodwill of customers, but I am afraid I do not have that impression in relation to British Telecom. On being privatised it seems to have been converted to having a very strange idea of the duties of a public company. It runs like lightning when it has a new model of telephone to sell—cash on the nail—and it sends oceans of literature on new telex machines. But when it comes to service which is at its own expense, oh boy, that is when one waits weeks and weeks, I am afraid. I know that a telephone line in my own village was out of action four times in the last year for a week at a time, waiting for British Telecom to send round engineers to fix it at its expense. But it will run like lightning if it is a question of the sale of new equipment.
So British Telecom's concept of public service in connection with the new company has in my experience left a little to be desired. The Government would deeply regret making a similar error with regard to British Gas. I sincerely advise the Government, in their own interests, to avoid the "aggro" which will result over the next year or two for the 16 million consumers, as pointed out by the noble Lord, Lord Diamond. Those consumers will experience such trouble and inconvenience if we do not do everything we possibly can at this stage to provide a safeguard for them in relation to this giant new corporation, this potential Dracula which I fear.
In view of the experience we have seen with the privatisation of British Telecom and because of what we know are the technical difficulties in connection with gas I wholeheartedly recommend that we strengthen by every means at our disposal the protection machinery for the consumer. I most strongly urge this Committee to express its complete support for the amendment of the noble Lord, Lord Ezra.
5 p.m.
Baroness Burton of Coventry: I wish to say just a very few words on this matter. The Committee need not be alarmed; I shall be very brief and my remarks will be neither learned nor technical. In the debate which we had on 10th April I said I thought that any future regulatory body should be tough, should be strong and should contain within it tough and consumer-minded members. I was very glad when this amendment was proposed today by my noble friends Lord Diamond and Lord Ezra, because I think we must all realise that at the moment the position of consumers, which this amendment would hope to modify or improve, is really quite serious.
The Committee will recall that at the moment under the present proposals the gas industry will not be compelled to disclose the profits it makes from the domestic consumers when it shows its accounts. There will be no way of showing how much those profits from the domestic consumers have contributed to some cross-subsidisation, whereas if we had the commissioners which my noble friends have been

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talking about, we should at least have one who would deal with tariff consumers. I think that should be borne in mind and perhaps when the noble Lord, Lord Gray of Contin, comes to reply he will deal with that particular point, with the transparency of the accounts that will be shown, and say whether or not the profits received from the domestic consumers of gas will be disclosed.
I want to make one other point. I remember that in that same debate—and my noble friend Lord Diamond referred to the same point—while saying that there had been many criticisms of the way Professor Carsberg had conducted affairs in so far as consumers were concerned (and I myself share that criticism) I made the point, and I maintain it again today, that I do not think it is so much Professor Carsberg as the legislation which is at fault. I am sure the noble Lord, Lord Gray of Contin, will recall that in another place right through the Committee stage Members—and not only Opposition Members—tried very hard to get this legislation tightened so that the same thing would not apply when it came to this Chamber.
This legislation has come from another place. It has not been fully discussed because it was guillotined, and it is our job to try to improve it. As my noble friend Lord Diamond said, it is not our job to throw out the Bill, because the other place has passed it, but we wish to improve it. I ask the noble Lord, Lord Gray of Contin, to believe that this is not a party point; I would make it whichever government were in power. I think it is quite essential that the legislation is tightened up, and tightened up adequately, so that what has happened at British Telecom through Professor Carsberg having to act on the legislation which is already in being is considerably improved in this case. Therefore I hope that the Committee accepts this amendment.
Viscount Torrington: I am well aware that I am somewhere near the back of the field in what is a rerun of the London Marathon and so I shall be brief. I also share the fear expressed by my noble friend Lord Bruce-Gardyne of "canine cannibalism"; so I have very little compunction in being against the amendment. I might have been tempted to be in favour if the breakdown between the duties had been slightly different from the way they were phrased, with tariff consumers for one commissioner, contract consumers for another, and gas purchases and energy efficiency for another. I would have thought that the industry breaks down into consumers, the purveyor and reticulator of gas (namely, the British Gas Corporation) and the suppliers.
My noble friend Lord Gray of Contin when in another place got to know the independent sector of the oil industry very well indeed as Minister of State for Energy. I am sure he and most other noble Lords here will know that the independent sector of the oil industry is somewhat frightened of this Bill. We in it are not frightened of British Gas per se: in fact we welcome it coming into the private sector very much indeed. But the independent sector is very worried about the monopoly buying powers of the British Gas Corporation, and while the right to export is certainly
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of great assistance in keeping this monopolistic power at bay, one can envisage—though I will not bore your Lordships' Committee on this—a lot of situations where the right to export would not protect smaller members of the producing consortia, especially, for instance, if British Gas was a member of those same consortia. So if there had been a commissioner drawn from the independent sector of the industry, I would possibly have been very tempted to support this amendment but as there is not I am afraid it cannot have my support.
Lord Williams of Elvel: I speak, as my noble friend Lord Stoddart of Swindon said, as the only person in your Lordships' Chamber who has actually sat across the table from the chairman of the Gas Corporation in an investigatory capacity. As I mentioned in my speech on Second reading, when I was chairman of the Price Commission we produced a major report on British Gas Corporation gas prices and allied charges. This involved a great deal of hard work and study. I say this in order to illustrate not only that I have some experience in this field of regulation but also to make the point that at that time our relations in the Price Commission with Sir Dennis Rooke and the Gas Board were extremely cordial. They were extremely tough but very cordial negotiations and I have absolutely no complaint to make about the way Sir Dennis Rooke and his colleagues comported themselves. I found them very expert but very tough and very concerned to press their point of view.
I want to make one very clear assertion. I do not believe that as the Bill is drafted the director who will be appointed can possibly perform all the tasks with which he is burdened. The US experience has been quoted by Members in various parts of the Committee. There is one thing that comes quite clearly out of US regulatory experience. The regulators need to be wholly familiar with the industry if they are not to be out-manoeuvred. This is a very fundamental point, because, whether it is a commission or a director, whoever is in charge of the regulation must be absolutely conversant with the day-to-day operations of the industry being regulated.
I take issue with certain noble Lords who have said that the director may have a rather minor role because, as the Notes on Clauses tell us,
"Once an authorisation has been issued to a public gas supplier, the day-to-day regulation of the supplier will be a matter for the Director, who is obliged to ensure that authorisation conditions and certain statutory requirements set out in the Bill are adhered to."
I do not regard this as a minor role. I regard this as a very major role. Therefore, I believe it is very fundamental that we should be quite certain that we have the right construction for this very major role. What does "day-to-day regulation" mean? What does "understanding of the industry" mean? They mean whoever is in charge of this day-to-day regulation must have a full understanding not only of the size of the industry, to which the noble Lord, Lord Diamond, referred, but of the complex nature of the industry.
Just to give some examples of the complexity of British Gas's operations, there is the question of the supply of gas, to which I think the noble Viscount, Lord Torrington, referred; the cost of gas, the southern basin of the North Sea versus the northern basin of the

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North Sea; the question whether the cost of gas is properly revealed in the Gas Corporation's, or the successor company's, accounts; whether they are basing their pricing on the long-run marginal cost of gas or the short-run marginal cost of gas; the allocation of different production costs between various sources of gas and between different types of consumer; the relationship between gas prices and oil prices—all these points, and the question of the supply of gas, must be wholly familiar to the director, or his office, and if they are not wholly familiar to him he will not do his job properly.
I go on from there to transmission and storage, load factor balancing and peak load pricing. These are points to which the director, or the commission if this amendment is passed, will have to pay particular attention. There are questions of marketing and servicing, accounting, cost allocation, accounting principles and overhead allocation. How do you tell whether there is cross-subsidisation, to which the noble Baroness, Lady Burton, referred, unless you are quite confident that you understand the accounting principles involved in the accounts which are set out?
There is also the safety consideration, the industrial relations consideration and all sorts of other activities on which the successor company may embark—I come back to something which I think the noble Lord, Lord Ezra, said in the Second Reading debate—which may themselves have an effect on the pricing to their captive consumers on the tariff. I think that the director, whoever it is, will have to be conversant with all these points.
5.15 p.m.
In the Notes on Clauses, we are advised again
"That the drafting of Clause 1 is modelled on Section 1 of the Fair Trading Act 1973 (… and the establishment of the Office of Fair Trading) and Section 1 and Schedule 1 of the Telecommunications Act 1984."
In other words, it is the Office of Fair Trading and Oftel which provide the model for Ofgas.
There are two major problems with this; and I am not going to talk about Oftel, because a number of noble Lords have referred to it and many valid points have been made. I should like to refer to the Office of Fair Trading. That was set up not to supervise and regulate an established monopoly industry; it was set up under the Fair Trading Act for a certain number of functions, to refer certain things to the Secretary of State and to prosecute certain things in front of the competition court. It was not set up to perform—and could not possibly perform—the role of regulating a clear monopoly.
The reason why it could not serve such a function and the reason why the director in this Bill that we have in front of us cannot himself serve such a function is, in my view, two-fold. First, there is the practical problem of one director being conversant with all the questions that I have outlined—and there are hundreds of other questions that one could mention—and being able to answer questions on television, on radio and to the newspapers. He will be the man up-front. He will have to stand up there and argue that long run marginal cost pricing has been observed or has not been observed. The problems of
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one man being able to undertake that particular job seem to me to be quite excessive.
Secondly, it is my experience in the Price Commission—and I think it has been Sir Gordon Borrie's experience at the Office of Fair Trading—that when you have one person standing up in front of the nation, a strong company, whatever it is, he is much more powerful when he has colleagues to support him. The decisions of a commission are much more respected than the decisions of one person—and they will be seen as decisions of one person.
The third reason why I should like to support this amendment from our Benches—because we will support it—is that I believe that in addition to the tasks of the different commissioners, to which the noble Lord, Lord Diamond, has referred, there is a very fundamental problem relating to the regions. This is not the Gas Consumers Council; we will come to the question of regional representation on that later in Committee. I am concerned with the management structure of British Gas and the successor company.
I have been impressed by the representations that have been made to us by Scottish interests on which I cannot speak from direct knowledge; but on Welsh interests I can do so. I believe that one of the commissioners, if the amendment were adopted, would have the task, as well as being responsible for whatever is in the amendment, of making sure that the regional management structure of the successor company was the same as the regional management structure that is at present adopted by British Gas and that has been extremely successful. That is an extra reason why we should consider favourably this amendment.
The Committee may feel that one commissioner should be responsible for Scottish interests and one commissioner should be responsible for Welsh interests. I have no strong feelings on that point. But I feel it would be appropriate, if such a commission were established, that at least one commissioner should be there to ensure that the regional interests, particularly the Scottish and Welsh interests, should be properly protected from the management side, as they will be, I hope, properly protected from the consumer side.
As my noble friend Lord Stoddart of Swindon said, we have thought long and hard about this amendment. For the reasons I have outlined, and for the reasons he gave, we believe that this amendment should be supported and we commend it to the Committee. As I think the noble Lord, Lord Sandys, remarked, we have a clear difference of political opinion on this amendment. We on our side of the Committee believe that this amendment goes straight to the fundamental heart of this Bill. This is what it will be about. If we are going to privatise a monopoly, we must have a proper system of regulation.
If we do not have that, we shall not be fulfilling our duty as a revising Chamber in putting in a proper protection both for the consumer and for the reasons to which I referred. It is for others to say whether they think that there should be three commissioners, four commissioners or five commissioners. It is for the Government, however, to make the case that we are wrong and they are right. I believe that this amendment should commend itself to the Committee.
The Minister of State, Scottish Office (Lord Gray of Contin): We have had a very interesting and lengthy discussion on this amendment—and I make no complaint about that. It is a custom of this Chamber to explore the territory fairly fully in the first amendment of a major Bill of this kind; and although at times we have perhaps wandered rather wide of the terms of the amendment, I think it has been useful to set before each other our views generally on this Bill.
There are a number of issues on which we have no disagreement at all. For example, we all believe that the interests of the public must be paramount in our deliberations. We all believe that we are a revising Chamber, and that it is our duty to examine very carefully the legislation which comes from another place. I cannot accept, however, the suggestion that there has been any lack of debate on this subject. This Bill was guillotined in another place—that is true—but, my goodness, we were well into the Bill before the guillotine became effective. Indeed, the area of the Bill that we shall be discussing after this amendment has already been very carefully tested elsewhere.
The noble Lord, Lord Ezra, is seeking to introduce a new clause which mirrors largely an amendment which was tabled during the Commons Committee stage by a member of his party. I know the noble Lord believes that there are valuable lessons to be learned from experience overseas, and particularly in the United States. I agree with him very much in that view. Where I disagree with him is that I think he has selected one of the areas from the United States with which we certainly should have nothing to do so far as this Bill is concerned. I am firmly of the view that the solution in the Bill with regard to regulation, which has been debated at great length and which we shall have an opportunity to explain and examine at even greater length shortly, is much preferable to that which the noble Lord seeks to have the Committee accept.
We have concluded that the right approach is for the regulatory body to be an independent office, along the lines of the Office of Fair Trading, and ultimately responsible, through a Minister, to Parliament. We are anxious to avoid replacing the present arrangements with the kind of bureaucracy which is apparent in the United States, where hundreds of staff in each state are involved in the regulation of utilities. In a few minutes I shall try to deal with many of the points that were raised by Members opposite. I am grateful to my noble friends Lord Elliott, Lord Bruce-Gardyne, Lord Sandys and Lord Torrington for expressing so succinctly precisely why they have little regard for the amendment.
I was greatly relieved when I read the amendment, inasmuch as it differs from that which was proposed in another place. It recommends only three commissioners. As the noble Lord, Lord Diamond, took us through the activities of these commissioners, I was relieved that they had been reduced from seven to three. Nevertheless, I realise that the noble Lord, Lord Diamond, feels deeply on these matters and I shall certainly try to do him the courtesy of dealing a little later with some of the important points that he made in his speech.
The noble Lord, Lord Ezra, is no stranger to me. We knew each other for a number of years while he was at
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the Coal Board and I was a Minister at the Department of Energy. In his speech this afternoon, in which he characteristically set out his views with great clarity, he mentioned the public utility position in the United States. I am surprised, really, that he sees these large unwieldy and bureaucratic organisations as a good model. In the case of the Public Utility Commission for a single state (California, for example) the number of staff involved runs into many hundreds—almost as large as the whole of the Department of Energy in this country.
The noble Lord seeks to follow the example of the United States of America in the care of this country and to replace the office we have proposed under a director general, following the successful example of the Office of Fair Trading. The noble Lord seeks to replace all of that with a commission. This is surely a recipe for bureaucratic bumble. The more I listened to various Members of the Committee opposite telling us what those different commissioners would do and what their responsibilities would be, the more I envisaged in my own mind the creation of the type of empire-building to which we became accustomed between 1945 and 1951 and then, again, at the return of any Labour Government. This is something which I think we should try to avoid.
The noble Lord, Lord Diamond, in his persuasive speech, failed to convince any of us on this side of the Committee that, although he may nowadays sit on those Benches, the spots of the leopard have not changed. His heart is still with his friends sitting on the adjacent Benches, because he was a very distinguished member of Labour Governments who revelled in the creation of those great bureaucracies with individuals who were more like commissars than commissioners. However, we are arguing our case on its merit, and we shall continue to do that when we come to discuss our own points.
We had a certain amount of scaremongering this afternoon. We had vague references to safety; we had references to Ofgas. My goodness—if I may refer to the speech of the noble Lord, Lord Diamond, again, I can quite see why, when he went to visit that particular Government department, it had 20 officials there to look after him. I am quite sure that, if what we got this afternoon was any example of his prowess, he was well able to take care of the 20 officials without much difficulty.
The noble Lord, Lord Stoddart, said that the Official Opposition had thought long and hard about this amendment and that they had decided that it was worth supporting. Well, they would, wouldn't they? It is hardly likely that an Opposition would not give support to an amendment of this kind, particularly when it flavours so much of their own political philosophy. But the Secretary of State for Energy has rightly pointed to the poor experience of regulation in the United States under the very kind of structure proposed by the amendment. During the 1970s the price of gas was kept down by over-control and by the lengthy procedures involved with the review of prices in that industry, sometimes lasting literally for years, to the extent that exploration for gas virtually ceased and the quantities of gas produced inevitably declined. That led to gas companies having to make cuts in their deliveries to consumers. The consumer was therefore

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disadvantaged, and both consumers and the gas industry itself suffered as a result.
The noble Lord, Lord Diamond, criticised the arrangements under the Bill to protect the consumer. He sought to portray a picture of an industry without any control. He felt that the industry would be released and that control would be removed, or that constraint on its activities would be completely lifted, compared with the present structure. I draw the noble Lord's attention—
5.30 p.m.
Lord Bruce of Donington: If the Minister will—
Lord Gray of Contin: We have had a very long debate. The noble Lord will have several days in which to give us his views. There is an important Statement to follow and I believe that the Committee would want me to bring this debate to a conclusion. I mean no discourtesy to the noble Lord.
I draw the attention of the noble Lord, Lord Diamond, to the fact that for the first time there will be a new office set up solely with the task of ensuring that the industry operates in a way that protects customers and protects their interests. Clause 4, which we shall reach quite soon, will lay a statutory duty on the director of the new office to protect the interests of customers. For the first time there will be an explicit price control formula to ensure that no longer can governments of any political complexion manipulate gas prices to their own financial ends. Noble Lords may laugh, but as they well know I can cite examples of both Labour and Conservative governments acting in that way. The situation in 1976, when the International Monetary Fund had to be called in to sort out the mess into which the Labour Government had got themselves, is one case in point. Under the new structure, that will all be in the past.
The noble Lord, Lord Diamond, suggested also that the powers of the director were too weak. Perhaps I may point out that the director has extensive powers under the enforcement provisions at Clauses 28 to 30 of the Bill. If the public gas supply fails to meet the supply obligations that are set out in key clauses of the Bill, or to meet the conditions of its authorisation, then the director may issue an order requiring the supplier to comply with that obligation. Moreover, failure to comply with such an order entitles any person who has sustained loss or damage as a result to take civil proceedings.
The noble Lord spoke also about research and development. I am sure that he recognises the great efforts made by British Gas in the area of research and development, including that in the area of improved efficiency of gas use. Indeed, in 1984–85 British Gas spent more than £50 million on research and development. British Gas, as a forward-looking business, knows that such expenditure is absolutely vital. Its own long-term commercial future depends on ensuring that gas can be burnt with the highest possible efficiency.
I now turn to the remarks of my noble friend Lord Torrington, who mentioned, quite rightly, that there is a certain amount of apprehension within the oil industry about the Bill. I believe that that has been
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because, in some areas, the Bill has not been fully understood, Hopefully, that situation has now been put right. However, the exclusive gas purchasing rights of British Gas were ended by the Oil and Gas (Enterprise) Act 1982. We are satisfied that any abuse of the corporation's powerful purchasing position could if necessary be curbed under existing competition law.
I should like now to answer the question posed by the noble Baroness, Lady Burton of Coventry. I am delighted that she will be taking an active part in this Bill because she is renowned for her defence of the consumer. It will be interesting to hear her views on various issues. The noble Baroness asked me about separate accounts. We shall be debating that subject at some length on later amendments; for example, there is Amendment No. 68 in the name of the noble Lord, Lord Diamond. However, it is already the case that under Condition 2 of the draft authorisation British Gas will be obliged to publish full information about the profits of the gas supply business.
In addition, the director will have full ability under Condition 7 to call for any further information that he might consider appropriate. Under Clause 35 of the Bill, the director has the ability to publish as much information as he considers expedient to give to tariff customers. That will ensure that if the director wishes to publish further information about the finances of the industry in the interests of consumers, he will be able fully to do so.
The noble Lord, Lord Williams of Elvel, who we all acknowledge has very great experience of the whole question of regulation, made a speech that I am sure the Committee found interesting. I noted one or two points from it. The noble Lord mentioned details of information. The Government recognise the importance of ensuring that the director can obtain full information from British Gas about its activities. It is for that reason that Condition 7 of the draft authorisation gives the director very wide-ranging powers to call for any information that he may need for his functions.
In view of the fact that we have had a lengthy discussion on this amendment, and given that we have a lot of business to get through, I shall not attempt to deal with other points that were raised. Let me say in conclusion that there is no difference between us so far as concerns that which we seek to do. We seek to achieve the best form of regulation. There is a basic, political, philosophical difference between each side of the Committee as to how it seeks to achieve that. We believe that the system we have spelt out in the Bill is the most satisfactory way to proceed. We believe that that which the noble Lord, Lord Ezra, and his noble friends seek to do would be merely to create a bureaucracy that we could well do without.
Lord Bruce of Donington: I sympathise with the noble Lord the Minister in his evident inability to reply to the case put forward very cogently by the noble Lord, Lord Ezra, supported by the noble Lord, Lord Diamond, and indeed supported by my noble friends Lord Stoddart of Swindon and Lord Williams of Elvel. Clearly, the noble Lord has no answer to the arguments that have been put forward.

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The Minister himself said—and I noted down his words—that we have a common interest in this Bill: the interest of the consumer. The noble Lord knows perfectly well that the purpose of the Bill is nothing of the kind. He knows perfectly well that the purpose of the Bill is, first, to produce an increased cash flow or negative expenditure for the Government for tax relief purposes and for electoral purposes; and, secondly, while so doing, to buttress the finances of their friends in the City. Everybody knows that quite well and there is no point in concealing it.
The noble Lord, Lord Elliott of Morpeth, put his finger on the point very well because he was quite disingenuous about the matter. He said that he thought the purpose of the Bill was to free the gas industry. Of course that is its purpose: to free the gas industry in the interests of the new shareholders, many of whom have already made a substantial capital profit out of it.
The noble Lord, Lord Diamond, because he is a generous man, put the best possible construction on the Bill, as is his wont. He said that we are united in a common purpose in that we desire to promote more efficiency within the industry, more cost-effectiveness, and so on. He put it mildly. But, once again, the noble Lord the Minister knows quite well that the machinery he proposes in the Bill for the protection of the consumer—particularly when it is read in conjunction with the code and with the schedule, upon which he will be cross-examined later in great mathematical detail—gives no more protection for the consumer than the regulations governing Oftel have, in the event, been proved to give.
The noble Lord, Lord Diamond, was therefore quite right in coming to the nub of the matter. Who is to protect the interests of the consumer against those of a body which, as the noble Lord, Lord Elliott, said, seeks its freedom and whose primary objective and purpose in straight commercial terms, understandable by a Conservative Government dedicated to it, is profitability for its shareholders. That is its purpose and the purpose of every public limited company. It would be failing in its duty if it were to be otherwise.
The noble Lord brushed off the experience of the United States as being bureaucratic. He need only look at the Bill to realise what the product of bumbling bureaucracy in his own department can produce. No wonder there is a certain sympathy for the noble Lord, Lord Elliott, in trying to free the industry from this miserable ministry. The public utility commissions in the United States, as the noble Lord knows quite well, have a very good reputation indeed. True enough, they employ people. But what they also do in regard to the utilities in their area, including the gas utilities, is, before there can be any price increase for whatever purpose, to review investment, working capital needs, research and development needs, and so on. Evidence has to be given before them, state by state.
In the final event, it is the commission, as an independent public body, that gives its assent as to what prices ought to be. In that way the interests of the public are protected. That is what the noble Lords, Lord Diamond and Lord Ezra, and, I suspect, many of your Lordships in this Committee who have any pretence of trying to protect the public interest, want.
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They do not want a miserable formula on which, I warn the noble Lord, he will be cross-examined in much detail, together with the mumbo-jumbo with which the Government have sought to conceal their intentions.
The only person who is capable of protecting the public interests in this area is someone who is not nominated by the Minister or who can be dismissed instantly by the Minister because Conservative Central Office probably has something against his record. An independent commission is necessary which is capable of studying what the Government are quite incapable of studying—the national or the public interest. The Minister may be able to avoid defeat in Committee because he has his cohorts not only here but in the other rooms in the building; but the public will demand proper safeguards. We on this side of the Committee have not the slightest hesitation in supporting the amendment put forward by the noble Lord, Lord Diamond.
5.45 p.m.
Lord Diamond: it would be discourteous of me not to respond to and thank the noble Lord the Minister for his short attempt, as he himself put it, to deal with many of the arguments put forward from this side of the Committee. He seemed to indicate that there will be other occasions when he will reply more fully, but he certainly dealt with some of the arguments, and for that I am grateful. I am also grateful to the noble Lords on the Government side who intervened, because they have helped us enormously, and I shall shortly come to that.
I apologise for seeking to intervene when the noble Lord, Lord Bruce-Gardyne, was speaking. I momentarily forgot that we were in Committee and that I should have ample opportunity later to deal with the point he was making. It would have been quicker if the noble Lord had given way and allowed me to make the point, but he is no doubt in no hurry to see this Bill through its Committee stage.
I am also grateful to the Minister—and I must not forget this—for making the important point that on this major amendment, our first amendment, it is inevitable that we spend a great deal more time than we shall be spending on much smaller and less important amendments later in the Bill. However, this is an amendment which enables us to stake out our ground and explain why we are wholly determined to examine this Bill in every way we can and provide for greater protection of the industry and of the consumer.
The noble Lord, Lord Bruce-Gardyne, takes an irresponsible view of his duties here. He takes the view that, having said on Second Reading that the only way of dealing with this problem is to introduce competition and that there is no way of introducing competition if you create a private monopoly, he has nothing more to say and nothing more to do. I do not share that view. I take the view that, as your Lordships' House accepted by giving the Bill a Second Reading the principles that I have outlined, the Committee has a responsibility to try to improve the efficiency of the industry and the protection afforded to the consumer.
We have made one modest suggestion. I call it a modest suggestion and not a bureaucratic suggestion

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with every justification. It is modest because, as the noble Lord the Minister himself made clear, an amendment discussed in another place proposed not a medium strong commission of three commissioners but a much stronger commission of seven or more commissioners. We hope that by being modest in what we seek and, as ever, compromising, we can get the Government to see that one man on his own cannot, as the noble Lord, Lord Williams, made clear, have either the information or the experience to cover this vast area and cannot stand up to the pressure that would face him if he sought to carry out his proper duties as outlined under the various clauses in the Bill. One man is not big enough and strong enough to do that. Therefore, we have to go further and suggest ways in which that should be done.
The Minister made only one criticism. He said that our proposals are bureaucratic. Our criticism is much stronger. We feel that in the present structure of the Bill the Government are avoiding giving administrative arrangements under which their purposes in the Bill can be carried out. It is not a question of arguing whether this is helpful.
Let me read to your Lordships what has been written about the experience to which I have previously referred. I shall read from a letter from Mr. Andrew Warren printed in The Times of 19th April. He is talking about the commissions which are established for every utility in every state of the United States and the machinery which is established wherever there is such a utility. He says:
"Each US state has a public utility regulatory commission charged with safeguarding the customer's interests"—
which is exactly what the Government want.
"The commissions exist to ensure that the utilities make the most cost-effective investments, leading in the long run to the lowest electricity and gas costs and prices to the customer"—
which is exactly what the Government want.
"It is these commissions which have ensured that public utilities keep their costs as low as possible and vigorously promote the most efficient use of energy".
There has been no attempt on the part of the Minister to say other than that these commissions are bureaucratic and to say how they will fail to do their duty in the way we have described.
The noble Viscount, Lord Torrington, helped us considerably. He thought that the amendment proposed by my noble friend was on the whole a good amendment which perhaps he would have supported if the breakdown of duties had been somewhat different. It is perfectly open to him to make that suggestion. It is clearly open to anybody to suggest how these enormous responsibilities should be divided. They are not divided into three in the gas corporation itself; indeed, it has far more than three divisions to carry out its responsibilities, does it not? It would not attempt to do so in so small a division as is now proposed. It is perfectly open to the noble Viscount to suggest a different breakdown which he wishes us to follow. He could put down an amendment.
Better still, if we could discuss the matter, we could put down an amendment at a later stage of the Bill which would satisfy his requirements, and thus do what we always try to do, which is so far as possible to meet the wishes of all the members of this assembly. In
1312
the meantime, I am bound to say that nothing has been said from the Front Bench opposite which denies what we are alleging; namely, that the one-man business is totally inadequate for the huge job that has been suggested. There are very many functions that have to be provided, for which enormous experience and knowledge are needed, and more than one man is required to attempt to do the job. I am very grateful to all the Members of the Committee who have supported the amendment and I remain convinced that it is the right approach.
Lord Ezra: The time has come when we must decide what we are to do about this amendment. I should merely like to say that this question arises from the decision to transfer a monopoly from the public to the private sector. I think that we are all at one in believing that this creates a situation which has to be handled with great care in order to safeguard the public interest. Indeed, the noble Lord the Minister said so.
Where we appear to differ is that whereas the Government feel that the Bill provides for a totally adequate regulatory body, we feel that this body needs some strengthening. We certainly do not propose the setting up of a mammoth bureaucratic organisation. In fact, we have not suggested that anywhere in the amendment. However, we feel that in the public interest and for the image which is created by the transfer of this monopoly into the private sector, there should be a stronger regulatory body than is at present proposed. It is on that basis that we should like to test the opinion of the Committee.
5.54 p.m.
On Question, Whether the said Amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 82; Not-Contents, 114.

DIVISION NO. 1

CONTENTS

Airedale, L.

Grey, E.

Amherst, E.

Hanworth, V.

Ardwick, L.

Harris of Greenwich, L.

Attlee, E.

Howie of Troon, L.

Aylestone, L.

Irving of Dartford, L.

Barnett, L.

Jacques, L.

Birk, B.

Jenkins of Putney, L.

Bottomley, L.

John-Mackie, L.

Briginshaw, L.

Kilmarnock, L.

Bruce of Donington, L.

Listowel, E.

Burton of Coventry, B.

Llewelyn-Davies of Hastoe, B.

Campbell of Eskan, L.

Lloyd of Kilgerran, L. [Teller.]

Caradon, L.

Carmichael of Kelvingrove, L.

Lovell-Davis, L.

Cledwyn of Penrhos, L.

McGregor of Durris, L.

David, B.

McIntosh of Haringey, L.

Dean of Beswick, L.

Mackie of Benshie, L.

Denning, L.

McNair, L.

Diamond, L.

Milner of Leeds, L.

Donaldson of Kingsbridge, L.

Mishcon, L.

Elwyn-Jones, L.

Molloy, L.

Ennals, L.

Mountevans, L.

Ezra, L.

Mulley, L.

Falkender, B.

Murray of Epping Forest, L.

Fisher of Rednal, B.

Nicol, B.

Fitt, L.

Oram, L.

Foot, L.

Phillips, B.

Gallacher, L.

Pitt of Hampstead, L.

Graham of Edmonton, L.

Ponsonby of Shulbrede, L.

Gregson, L.

Prys-Davies, L.

1313

Rathcreedan, L.

Underhill, L.

Rochester, L.

Vernon, L.

Seear, B.

Wallace of Coslany, L.

Seebohm, L.

Whaddon, L.

Sefton of Garston, L.

White, B.

Shaughnessy, L.

Wigoder, L.

Stallard, L.

Williams of Elvel, L.

Stedman, B. [Teller.]

Willis, L.

Stewart of Fulham, L.

Wilson of Rievaulx, L.

Stoddart of Swindon, L.

Winterbottom, L.

Strabolgi, L.

Ypres, E.

Tordoff, L.

NOT-CONTENTS

Abinger, L.

Layton, L.

Airey of Abingdon, B.

Lindsey and Abingdon, E.

Alexander of Tunis, E.

Long, V.

Allenby of Megiddo, V.

Lucas of Chilworth, L.

Belhaven and Stenton, L.

Luke, L.

Beloff, L.

Lyell, L.

Belstead, L.

McAlpine of West Green, L.

Bessborough, E.

Macleod of Borve, B.

Boyd-Carpenter, L.

Mancroft, L.

Brabazon of Tara, L.

Margadale, L.

Brougham and Vaux, L.

Marley, L.

Bruce-Gadyne, L.

Marshall of Leeds, L.

Buckinghamshire, E.

Maude of Stratford-upon-Avon, L.

Caithness, E.

Cameron of Lochbroom, L.

Merrivale, L.

Campbell of Alloway, L.

Mersey, V.

Carnegy of Lour, B.

Milverton, L.

Cathcart, E.

Montgomery of Alamein, V.

Coleraine, L.

Mottistone, L.

Colwyn, L.

Mowbray and Stourton, L.

Cottesloe, L.

Munster, E.

Craigavon, V.

Murton of Lindisfarne, L.

Craigmyle, L.

Newall, L.

Cullen of Ashbourne, L.

Nugent of Guildford, L.

Davidson, V.

Onslow, E.

De La Warr, E.

Orkney, E.

Denham, L. [Teller.]

Orr-Ewing, L.

Drumalbyn, L.

Rankeillour, L.

Dudley, E.

Reay, L.

Dundee, E.

Romney, E.

Ellenborough, L.

Rugby, L.

Elliot of Harwood, B.

St. Davids, V.

Elliott of Morpeth, L.

Saltoun of Abernethy, Ly.

Elton, L.

Sanderson of Bowden, L.

Faithfull, B.

Sandford, L.

Ferrers, E.

Sandys, L.

Forte, L.

Selkirk, E.

Fraser of Kilmorack, L.

Shannon, E.

Gainford, L.

Skelmersdale, L.

Gardner of Parkes, B.

Strathclyde, L.

Gisborough, L.

Strathcona and Mount Royal, L.

Glanusk, L.

Glenarthur, L.

Strathspey, L.

Grantchester, L.

Swansea, L.

Gray of Contin, L.

Swinfen, L.

Grimston of Westbury, L.

Swinton, E. [Teller.]

Hailsham of Saint Marylebone, L.

Thorneycroft, L.

Torrington, V.

Hardinge of Penshurst, L.

Tranmire, L.

Harris of High Cross, L.

Trumpington, B.

Harvington, L.

Vaux of Harrowden, L.

Henley, L.

Vickers, B.

Hives, L.

Vivian, L.

Hood, V.

Ward of Witley, V.

Hooper, B.

Whitelaw, V.

Hylton-Foster, B.

Wise, L.

Kimball, L.

Wolfson, L.

Kinnoull, E.

Young of Graffham, L.

Lane-Fox, B.

Resolved in the negative, and amendment disagreed to accordingly.
6.2 p.m.
Lord Brabazon of Tara: We have reached a suitable moment, I believe, to take the Statement. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

British Leyland
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth): My Lords, with the leave of the House, I should now like to repeat a Statement that has been made by my right honourable friend the Secretary of State for Trade and Industry in another place concerning British Leyland. The Statement is as follows:
"With your permission, Mr. Speaker, I should like to make a Statement.
"When I made my Statement to the House on 25th March following the end of the talks between British Leyland and General Motors on the privatisation of the main Land Rover-Leyland businesses, I made it clear that British Leyland would continue to study alternative ways forward for all the businesses concerned. In the particular case of Land Rover and Freight Rover, British Leyland asked for proposals to be made by 15th April. As the House is aware, four proposals were received. These were from Aveling Barford in respect of Land Rover and Range Rover; J. C. Bamford in respect of Land Rover, Range Rover and possibly Freight Rover; Lonrho in respect of Land Rover and Range Rover; and Schroders, acting for a management and institutional consortium, for Land Rover, Range Rover and Freight Rover.
"The British Leyland board has carefully considered these proposals and has weighed them against the option of retaining Land Rover and Freight Rover within British Leyland for a possible flotation or trade sale at a later date. The board has concluded, on both commercial and industrial grounds, that retention of the businesses within British Leyland pending a later sale presents a more attractive option for British Leyland than any of the bids which have been received. The board has therefore recommended to the Government that none of the bids be pursued and that the companies be retained within British Leyland while preparations for future privatisation are made. The Government have accepted the board's recommendation."
My Lords, that concludes the Statement.
Lord Bruce of Donington: My Lords, we on this side are grateful to the noble Lord for having repeated the Statement made in another place. We should also like to extend our sympathy to him for having to announce such a humiliating decision by the Government. We do not propose to detain the House for long in view of the important business that we have on hand. We shall therefore refrain from rubbing the Governments nose further into the mess that they have created. All we would note for the time being is that this belated decision has cost the industry thousands in terms of uncertainty in the minds of staff and customers. This decision is long overdue. Will the Government give an undertaking to keep their nose, in future, out of the business of British Leyland?
Lord Diamond: My Lords, I, too, thank the Minister for repeating the Statement, but it does not explain in any substantial way why there has been this change of ground. Why did the company, and the Government behind the company, start negotiations to sell something and then decide that they were not going to sell? Would it not have been simpler not to have started upon this? Would that not have saved the anxiety that has been referred to and a lot of uncertainty? Would it not have saved employees the anxiety of not knowing what was happening to them? Why have the Government suddenly decided that what they wanted to do a short time ago they no longer want to do? Is it because the bids were unattractive in size, or is it because the Government have returned to their senses? We hope that it is the latter.
Lord Lucas of Chilworth: My Lords, I have to acknowledge the response of the noble Lord, Lord Bruce of Donington, to the Statement that I have just made. But his response raised no questions for me to answer. The noble Lord, Lord Diamond asked me a question: why have we entered into negotiations that have now been abandoned? The reason, as I have oft repeated in your Lordships' House, is that it is the Government's intention to return British Leyland to the private sector because we believe that the company and its subsidiary companies would be better able to function in the private sector. That we still believe. It has been our intention in pursuing that aim to ensure long-term future viability, particularly of the truck industry to which Land Rover and Range Rover were attached at the outset. Unless some rationalisation takes place, we believed at that time, and believe today, that that future is in some jeopardy.
That the negotiations broke down, as I repeated to your Lordships in a Statement on 25th March, was unfortunate. It was beholden upon the board of British Leyland, however, to pursue the inquiries that were then on the table. That has been done. The British Leyland board has concluded that none of those bids is in the long-term industrial or commercial interests of the company. It has rejected the bids. It has advised Her Majesty's Government of its view, and Her Majesty's Government have concurred with it.
Lord Bruce-Gardyne: My Lords, can my noble friend tell the House what there is in the record and performance of British Leyland's management of this business in the past to lead one to expect that it is likely to make a better fist of managing this business than any of those who are bidding to take it over?
Lord Lucas of Chilworth: My Lords, I say this within the context of the Statement—that is, Land Rover and Range Rover. There is no doubt that the management, through their rationalisation of assembly plants into one establishment (that of Solihull), the past year's improvement in profitability, which was marginally better than the previous year and which brought that subsidiary company from loss to profit, and the plans for wider international distribution of the product, which is gaining a more favourable acceptance, give us reason to suppose that the company may very well prosper. We have faith in the company in pursuing their policies. That will
1316
enable us to secure the aim, to which I have earlier referred, at a later date.
Lord Barnett: My Lords, if the management is that good, why did not the Government agree to the management buy-out?
Lord Lucas of Chilworth: My Lords, because the management buy-out, the conditions attached, and so on and so forth, when set against the option of leaving the company within British Leyland for a future date were not considered as attractive.
Lord Lloyd of Kilgerran: My Lords, in order to reduce the suspense and anguish to members of British Leyland and their customers, is the Minister able to say how long it will be before the preparations for future privatisations—mentioned at the end of the Statement—will take place? Has he any idea? Is the Minister aware whether the trade unions were consulted in deciding not to proceed with these various attempts to modify the position?
Lord Lucas of Chilworth: My Lords, I do not wish to be pedantic but when the noble Lord, Lord Lloyd of Kilgerran, refers to British Leyland we are talking about only one aspect of British Leyland: that of Land Rover-Freight Rover. So far as the timing is concerned it is, frankly, very difficult to tell when a more propitious moment may arrive. We would seek to identify that moment in concert with the British Leyland board and then pursue the objective which I have described. With regard to trade union consultation, my honourable friend the Minister for Industry, and my right honourable friend the Secretary of State, have received every delegation from the trade unions who have asked for consultation. Indeed, my right honourable friend the Secretary of State has made himself available to Mr. Todd who has declined to accept the invitation to discuss these matters with him.

Gas Bill
6.14 p.m.
House again in Committee.
Clause 1 [The Director General of Gas Supply):
Lord Diamond Lord Diamond moved Amendment No. 2:
Page 1, line 8, at beginning insert ("After consultation with the appropriate Committee of the House of Lords,").
The noble Lord said: We have to accept for the moment that there will not be a commission of three persons, with the strength of their combined force, but only one such person who is referred to as the regulator. If that is the case it becomes more important than ever that that person should enjoy the confidence of the Chamber and of Parliament and should feel that he has Parliament's understanding on those occasions in which he may find himself under undue pressure either from the Minister or anybody else. In our view the way to do that is to enable the relevant committee of the House of Lords to be consulted. It is referred to in the amendment as the "appropriate Committee".
I should like to draw attention to one or two aspects of this amendment. We are now talking about consultation. We are not talking about approval. We are trying to find out the Government's position, and whether they would agree to the minimum possible protection—that is to say, consultation. It does not mean that the appropriate committee would have any power of veto or anything like that. It would merely mean that the individual himself, and more particularly the Secretary of State, would know the general reaction of a committee of the House of Lords to a proposed appointment and would be all the better informed therefore as to whether they should or should not make the appointment, and the conditions of that appointment. The amendment refers to "consultation" and the "appropriate Committee".
First, why should it be a committee of the House of Lords at all? The answer is because this has proved a very satisfactory method in other countries where they have adopted what the Government are now adopting: the policy of having utilities managed as private monopolies. I have already described it to Members of the Committee and I am sure that you would not want me to go over the ground again. In their constitution it is not a Committee of the House of Representatives, but the Senate Committee—the Committee of the Upper House—which has this responsibility of receiving reports and examining individuals from time to time. In my view it is highly appropriate that it would be the House of Lords which would approach its duties without any partisan or party bias, in a very objective way. The committee would help the Secretary of State to discover whether the individual proposed has these enormous abilities and the experience to be able to regulate the industry and to be able to stand up to the board, the chairman, all the directors, and the staff and customers behind them. The House of Lords would carry out its duties in a most objective way and would assist the Secretary of State in that aspect.
The Secretary of State would also know not only whether the individual—the candidate—was regarded as suitable for this enormous task but also whether he was a person who understood the needs of the situation as explained to him in examination by a committee of Members of your Lordships' House.
This is a modest amendment. It refers only to consultation. It fills in a most regrettable gap in the whole Bill. Nowhere in the Bill, so far as I can see, do the Government propose to consult Parliament. It has taken a public monopoly away from the control of Ministers and of Parliament as a consequence because we all know that every Member of either House can ask questions of a Minister about his responsibilities. It has completely taken away any protection that an individual consumer, a tariff customer or non-tariff customer may have so far enjoyed and replaced it with nothing. Other than by receiving a report after the event—which it can presumably debate if it finds the time to do so—this Chamber has no powers to affect or influence the conduct of the individual concerned. All those powers of protection have been taken away and replaced with absolutely nothing.
This is an extremely modest attempt to introduce consultation with a committee of the House of
1318
Lords—a committee best able to do it because of its skill and objectivity in dealing with matters of this kind. I beg to move.
Lord Bruce of Donington: On this side of the Committee we are very sympathetic indeed to the proposal that has been put forward by the noble Lord, Lord Diamond. I do not think it is a matter of contention between the parties that we live in a time when the Government themselves, and the Prime Minister in particular, have enormous powers of patronage—patronage that they do not hesitate to use. This may be considered to be a good thing. Indeed, the noble Lord is quite entitled by way of reply to say to me, "Well, previous Labour Governments have exercised the power of patronage. Why, therefore, should there be any particular exception so far as a government who are composed of the opposite political persuasion is concerned?"
There is a short answer to that. Quite clearly the existence of much of this Bill confirms (and we might as well be quite frank about it) that there is a conflict of interest between the principal aims of the privatised gas company, on the one hand, and the interests of the consumer, on the other. Were it not so there would be no necessity for the appointment of Ofgas and the appropriate director. To use a term very much favoured by the Chancellor of the Exchequer, if it is a matter of the law of automaticity, as he was kind enough to refer to it in another context, if the interests of the newly privatised monopoly were identical and naturally in conformity with those of the consumers in all respects, there would be no need to have any regulatory body at all. All that would need to be done would be to stop the nonsense of privatising and leave the existing Gas Acts which provide for statutory regulation and allow the nationalised corporation responsible ultimately to Parliament to operate, as it has operated successfully for many years. There is, therefore, a conflict.
The appointment is one of enormous importance, particularly in the light of the very detailed provisions in the Bill and the enormous responsibilities geographically, technically, financially and from a safety point of view that are put on to this particular director general. Is it really safe for the appointment of this very important person to be left solely to the Secretary of State, particularly if the Prime Minister is leaning on him as she is bound to do from time to time if she has a particular favourite foible of her own? Is it safe to leave it to the Secretary of State unaided? Are we quite sure that the Secretary of State is free from the representations that may or may not quite properly emanate from Conservative Central Office? Is it right that a very sensitive appointment of this kind should be left like that, particularly in the light of the fact that, as Members in all parts of the Committee know, Secretaries of State come and go, at very frequent intervals recently, all over the Government's spectrum?
I do not go the whole way with the noble Lord, Lord Diamond, in the sense that he would seek to compare this Chamber with the Senate in the United States. The functions are different. The Senate is a legislative body; it has elected representatives; and it is really a much more powerful and distinct body than this

1319
Chamber. But over the past five or six years in particular—I would not wish to decry its former history, but I talk only from my own personal experience—this Chamber has come to be held in increasing regard by the public at large, and particularly for the quality and experience of its active Members.
I do not include myself among the experienced and qualified people, but there are very large numbers of noble Lords who are qualified in almost every expert field of administration, for example in engineering, technology, physics, chemistry, the law and accounting. There is a very wide spectrum of experience available in this Chamber, and a Select Committee would have that expertise. In fact, as I believe I have said before in a different context, probably the Select Committee on Overseas Trade has more experience, expertise, intelligence and perception than the Cabinet itself.
We are talking now of future governments as well as of the present Government, who will not be here for very much longer; but so long as they are here surely it would be wise to present themselves with that degree of impartiality that they always affect when they communicate with the electorate, to give them an air of electoral respectability. Even on those narrow political party grounds they might commend themselves to noble Lords opposite.
I think it is a very good idea, when the Minister of State has in mind to appoint a person, either male or female, to a job of this kind, that that person should present himself or herself to a Select Committee of this Chamber for informal conversation and also to be examined in the light of the contents of the Bill. It need not be an extremely full-dress occasion, but the Select Committee could be made aware of the person's qualifications, could assess his personality, could have his CV in their hands, and generally be able to make an objective judgment which they would not express publicly in any way. Then the Minister could consult the committee and the committee could tell him what they thought.
The Minister would not be bound by that. The decision would still be his own but it would be made after consultation and it might be—I do not say it would be, because there is no certainty in these matters—that the Minister of State would have second thoughts about the first choice or the second choice and might, in the event, choose a person more fitted to the task as a result of the consultative process than if he had appointed him purely on caprice, or under pressure from the Prime Minister, or after consultation with the Conservative Central Office. We support the amendment.
6.30 p.m.
Lord Whaddon: This is a worldly amendment. After his appointment, this officer is going to be under the glare of public attention for a period of years. He is going to discharge a most important function, that of looking after the interests of 16 million customers. It is a dreadful burden to have to carry. It is most desirable that he should be seen to be properly appointed and that it should not in any way be a hole-in-corner appointment.
1320
If he is to be examined gently by Parliament, I also think that this House could usefully discharge that function. The other place has an enormous burden of work. I think that it would gladly hand over such a job. Perhaps I may also say that the average age of first election to the other place is 37 years; possibly to our regret we have far more years of experience under our belts in this House, and we can use that experience. A great deal of time and a great deal of industrial, commercial and administrative experience is enshrined here, and we should place that to the public service.
I therefore have the greatest pleasure in recommending with the greatest sincerity that the Government should on this occasion show their magnanimity and open-mindedness by conceding this worthy amendment which has been moved by my noble friend Lord Diamond.
Lord Sandys: This amendment may have certain superficial attractions, but there is one fundamental problem. In moving it, the noble Lord, Lord Diamond, is seeking to tie the hands of the Secretary of State. The suggestion is that advice would not be available. There is certainly a gratifying suggestion here, which is not repeated in any other statute so far as I am aware, that consultation should take place with a committee of your Lordships' House. I am not aware of any other statute and perhaps the noble Lord can inform the Committee on that point. I should be delighted to know whether this procedure of consultation with a committee of your Lordships' House prior to an appointment is in statute law at present. If it is not, I may be correct. However, the noble Lord is proposing an innovation. I suggest that the advice of the Secretary of State, with which he will be amply supplied, will be sufficient without embodying this in a statute.
Lord Harris of Greenwich: Perhaps I may make a few remarks. A few moments ago the noble Lord, Lord Sandys, said that he knew of no precedent for this. I never regard that by itself as an overwhelming argument. It is sometimes a good idea to take some step of an innovative character, and undoubtedly this proposal is one such step.
In this debate one thing we have to recognise is the dissatisfaction of many members of the public, who have no particular partisan feelings on the subject of privatisation, about the wholly unsatisfactory arrangements which obtain at the moment as regards British Telecom. There is a general feeling that the consumers' interest has been treated with, to be quite blunt, scarcely veiled contempt. One has only to look back at one of the most recent decisions on pricing policy to see the amount of severe criticism which was directed at British Telecom and at the consumer interest that exists there because it was felt that the public interest has not been safeguarded.
If we are now involved in a second-rate exercise of the same character where we are creating a new private monopoly, it seems to me that it is probably a good idea to take action of an innovative character. This undoubtedly comes within that category. I believe that it would be warmly welcomed by many outside this House who, I repeat, have no particularly strong

1321
feelings either for or against privatisation but who believe that there should be far more satisfactory protection as far as the consumer and the public interest is concerned. That is my first point.
Secondly, it is sometimes rather a good idea (and I think that there is some general bipartisan feeling on this as well) to limit the powers of ministerial patronage. In the lifetime of this Government there has been constant criticism about the ways in which those powers of patronage have been used. That is not unique to this Government; it has also been directed at their predecessors. It seems to me that if a proposal is made that some committee of your Lordships' House should be consulted, that is not necessarily a bad thing in itself and would probably create a greater degree of public confidence than if it were simply left to the discretion of a Minister acting on his own authority. For those reasons, it seems to me that my noble friend Lord Diamond has made a very persuasive case.
Lord Gray of Contin: The Committee will not be surprised to learn that I cannot accept this amendment; nor am I persuaded by any of the arguments. The procedure which we have set out in the Bill for appointing the Director General of Gas Supply follows a well established precedent and, as the noble Lord, Lord Bruce of Donington, indicated, that is not in dispute. Both the Director General of Fair Trading and the Director-General of Oftel must be appointed by the Secretary of State, and those are but two examples. The list is long. The procedure is well tried and it has been found to be satisfactory. Scores of government appointments are made in this way. It would be entirely unnecessary, and I believe inappropriate, to single out the appointment of the director for consultation with committees from either House of Parliament.
In our consideration of the method of regulating the industry we scrutinised very closely overseas methods, particularly the American method referred to by the noble Lord, Lord Diamond. The requirement to consult parliamentary committees before appointing the director would be similar to the approval of appointments by the Senate committees in the USA. This procedure has been severely criticised in the USA because it leads to considerable delays.
The noble Lord, Lord Diamond, also indicated that there was no consultation in Parliament. Indeed the noble Lord overlooks the process which we are now going through. The Bill itself will be subject to the fullest scrutiny in this House, and it has already been subject to considerable scrutiny in another place. The Secretary of State has also ensured that a draft of the proposed authorisation has been made available during discussions in another place and in this House.
Baroness Seear: I am sorry to interrupt the noble Lord, but if I understand him aright, he is talking about consultations over the Bill. My noble friend Lord Diamond was talking about consultations over the appointment, which is totally different.
Lord Gray of Contin: With the greatest respect to the noble Baroness, I do not think that it is totally different. I am pointing out that there is ample
1322
opportunity to scrutinise the method that we use for making appointments, and that is precisely what we are doing now. We take the view that the Select Committee system is not designed for the purpose for which the noble Lord seeks to use it, and we believe that it is inappropriate that it should be used for such a purpose. We believe that the traditional system of the Secretary of State making such appointments is the best way forward, and it is one which is well tried and which has been found to be satisfactory.
I am not for one moment suggesting that over the years appointments by various Secretaries of State from different political parties have always met with unanimous acclaim. Of course that would never be so. However, by and large, the system has worked well and we believe that it is best for us to stick to it. We do not consider the proposal in the amendment moved by the noble Lord, Lord Diamond, to be an improvement on the existing method. For that reason and for the other reasons which I have mentioned, we do not feel able to accept the amendment.
Lord Harris of Greenwich: It is disappointing that the noble Lord is so inflexible. He did not have the opportunity of dealing with one point that I endeavoured to put to him, and I am sorry to have to take up a small amount of time in repeating it. There has been constant criticism during the lifetime of this Government, just as there was in the lifetime of the previous Labour Government and the previous Conservative Government as well, about the powers of ministerial patronage.
I see with pleasure the noble Lord, Lord Fraser of Kilmorack, in his place. He will remember the great dispute that took place during the lifetime of the postwar Labour Government about allegations that Ministers were appointing political friends. I think the phrase used at the time was, "Jobs for the boys". I do not see an overwhelming argument why in a matter of this sort we should not break new ground.
The noble Lord says that it is right for Ministers to make the appointment. In the final analysis of course they will. What is asked for here is a power of consultation. What is so offensive or so wholly objectionable about a Minister consulting one Mouse of Parliament on such a matter? I cannot see an inherent objection to the principle recommended in this amendment. I should be grateful if the noble Lord could deal with that point.
Lord Gray of Contin: I am happy to do so. I am grateful to the noble Lord for his contribution and for making the suggestion. Whatever department is making an appointment, anybody who has had experience of government will confirm that these appointments are not made, generally speaking, without a considerable amount of consultation among Ministers. It is not a case of Ministers just selecting chums and appointing them at random. There is a great deal of consideration given to appointments because appointments of this sort are going to attract a considerable amount of public attention, and, if the Government get it wrong, the Government will be subject to a considerable amount of criticism.
The Government do not accept the proposal that a Select Committee would be a more suitable or

1323
appropriate body to make such a selection than the Secretary of State, with the benefit of the advice available to him. We have provided that the Secretary of State has responsibility for the director. As well as appointing the director, he receives an annual report from the director on his activities, which is also laid before Parliament. This ensures that the director is accountable, through the Secretary of State, to the whole of Parliament. That is a more satisfactory position than having the director appointed by a Select Committee.
Lord Williams of Elvel: The noble Lord has not addressed the point of the noble Lord, Lord Harris of Greenwich. Nobody is asking for a Select Committee of this House to make the appointment. The amendment specifically refers to "consultation". If I may go back some years to my appointment as chairman of the Price Commission—as commissar, I think the noble Lord referred to it at an earlier stage this afternoon—it was not done in consultation with anybody. I know how these appointments are made. The Civil Service comes up with a list of names. The list of names is known throughout Whitehall. Certain names are chosen for good or for bad reasons. Then somebody comes along and selects the appropriate name.
This appointment, as noble Lords will be aware and as other noble Lords have said, is going to be a matter of enormous interest to the public at large. The person appointed is going to be a major public figure. What we ask is, is it not right, as the noble Lord, Lord Harris, said, just to break new ground and take the consultation of the committee of one House of Parliament?
6.45 p.m.
Lord Gray of Contin: No. The noble Lord is very persuasive, and he was one of the nicest commissars that we could have had. But he has not succeeded in persuading me that he has built upon the point made by the noble Lord, Lord Harris. He was equally persuasive on this, but I cannot accept that a Select Committee of either House, for that matter, is in a better position to give advice to the Secretary of State on an appointment of this nature. They are not necessarily in a better position than the Secretary of State and his advisers.
It may well be that they would come up with many of those to whom the noble Lord referred—the good and the great, as they are known in Whitehall. They may well be on both lists. I am just not prepared in this case to accept that it will be of benefit to move from the established system which we have followed and which I believe to be satisfactory. After all, these committees are not designed for that purpose at all.
It would be wrong to bring a House of Lords' committee into a situation where it could be criticised for being political. House of Lords' committees genuinely pride themselves on being above politics, if I may put it that way. We are coming near to dragging them into politics. If that is what we want to do, perhaps this amendment is right. But I think it is better to leave them in their elevated state where they can look at various problems objectively. I fear that if we involve them in this sort of situation, we may be
1324
putting at least part of that at risk. I would rather leave things the way they are. I hope that the noble Lord may be persuaded to withdraw his amendment at this stage.
Lord Whaddon: The point that the noble Lord has made is that the Select Committees pride themselves on being above politics, which is true, whereas Ministers of course pride themselves on being political. The holder of this appointment will deal with 16 million consumers, members of the public. We on these Benches do not want to be renationalising this industry after a couple of years, and it is important that this officer is seen to be above politics and not a party stooge.
This makes it all the more important that the well known Select Committee, which prides itself on being above politics, should not make the appointment—which the noble Lord appeared to imply a few moments ago—but should scan the nominees. The nominee is going to be before television and the press time and time again over the years. If he cannot stand such exposure at the time of his appointment, he would be better not appointed. Will the noble Lord please rethink and consider whether this is an occasion on which he could legitimately give way?
Lord Gray of Contin: No, I should not dream of giving way on this because I do not think there is a valid point. There is no reason whatever why a Select Committee, if it feels so inclined on a particular appointment, cannot make the Secretary of State aware of its views. But it is quite wrong for us to write that into legislation. A Select Committee has the perfect right, if it chooses to use it, and it would be perfectly in order, to make that view known to the Secretary of State. But I am not happy about writing it into legislation.
Lord Whaddon: How can it make its views known without interviewing the nominees? How is it possible? We are simply asking for what the noble Lord has suggested to be done in a rational system.
Lord Diamond: It will come as no surprise to your Lordships not only that I regret the response of the Minister but that I wholeheartedly reject the snub he intends for this House and for the way in which committees of this House function. I reject it on the basis of my experience. The noble Lord asked for people who were experienced in government and on appointments. I had the privilege of being the first chairman of your Lordships' European committee, and I gained experience of the way in which the Government would listen, and listen fully, to the views of that committee and of its sub-committees, which were based on evidence, interviews and inquiries. Those views were not based on something taken off the top of one's head without being able to see the person.
It is the authority of the individuals and the evidence they give which enables your Lordships' European committees to function so well, to have the respect of both Houses, the respect of this country and of other countries. I reject completely the Minister's approach. I reject completely his suggestion that committees of your Lordships' House work politically. There may be

1325
committees of which I have no knowledge which work that way; but nevertheless I reject it.
The Minister knows that in the other place everybody is very politically inclined and partisan, and has to be because constituencies have to be looked after and parties have to be represented. Yet when Select Committees are formed, with a majority on the Government's side, as they always are, they take an objective view and the party approach is often laid on one side.
Lord Gray of Contin: Perhaps I may—
Lord Diamond: I shall gladly give way as soon as I have finished my point. That is in the other House. But we are not talking about the other House; we are concerned with this Chamber. Anyone who suggests that the Select Committees of this House act more politically than the Select Committees in another place must be drawing on experience which is totally unknown to me.
Lord Gray of Contin: I think the noble Lord must have misheard me. I did not for one moment suggest that the Select Committees of this House were political in any way; quite the contrary. When his noble friend sitting behind him spoke he acknowledged that. He said that they were very proud of being non-political. I think I used the phrase "above politics". I am afraid the noble Lord has it wrong. I did not say that; so I do not know why he will not accept the point. I certainly did not say it.
Lord Diamond: I shall remind the noble Lord of what he did say, and I am not proposing to withdraw one tittle of what I said. The noble Lord said that the present proposals do not involve committees of your Lordships' House in acts which are near political, but that if this proposal were to be accepted, they would come into political activity.
Lord Gray of Contin: They might.
Lord Diamond: What he was saying was that if this amendment were adopted, the relevant or appropriate Select Committee would be acting politically. Your Lordships heard him, and that is the logical outcome of his remarks. I repeat that I reject completely what he said on those arguments.
What the Minister wanted to say to us was that there is no reason for any of this. There is the opportunity through examining the Bill for Parliament to make its views known. I am grateful to my noble friend for making it clear that we are not talking about examining the Bill. But if we were, what benefit would there be in our examining the Bill and making suggestions if every suggestion were turned down flat, as has happened so far?
Noble Lords: We have had only two.
Lord Diamond: They have all been turned down flat without any regard to their logic, validity or value. I do not know how many amendments the noble Lord will accept so as to prove what he is now indicating. We look forward to that very much.
1326
The noble Lord the Minister also said that we have two excellent precedents. Why change the system when we have two excellent precedents? What are his precedents? The first is the Office of Fair Trading. As has already been made absolutely clear, that is not a parallel. It does not have the same function at all. I do not know how many times the Minister—I hope I may have his attention—wants us to repeat an argument so that it is taken on board by him. We are patient and we shall gladly repeat the arguments as necessary.
Lord Belstead: Until seven o'clock.
Lord Diamond: We have made it absolutely clear so far that, as many noble Lords have said, the Office of Fair Trading has a totally different function and has no parallel with what we are talking about.
The other precedent which the noble Lord so magnificently produced was that of Oftel. The whole of this argument arises because Oftel has proved to have an unsatisfactory method of appointment; otherwise we would not be bothering the Government. There is no need to repeat what the Government know does not work and has not worked. Therefore we say that there should be consultation. The Minister has produced no other consultation proposal in advance of the appointment. All he said is that a year, 15 or 18 months after appointment a report made will be made and the House can say to itself what it likes about the report. In the meantime the officer in question will continue in post and will know that he is supported by the Secretary of State. Whether that is satisfactory to Parliament or the House of Lords is a different matter.
Then we go on to talk about the House of Lords itself. I am very sorry that the Minister is not taking this opportunity to strengthen the standing of this House and the regard which is paid to it. We have moved a very long way in the last few years, but there is no reason why we should not move even further in establishing the respect of the country as a whole. One way to do that is to let it be seen—I mean that we should literally let it be seen—that there is a committee of the House of Lords on a parallel with what has been well established, that it has this function and that it carries it out in an informed, totally objective and non-partisan manner.
The noble Lord says that of course they do this in the States; but it results in delays. Dear me! Have they stopped doing it? Is it not true that they continue doing it? Is it not true that the Senate committee have much more regard for getting the right man than for saving a week through not consulting the Senate? Would it not be wise for Parliament to be consulted as is suggested here?
Noble Lords may ask why I am not suggesting both committees of Parliament. Those of your Lordships who have previously been in another place and are aware of the pressures there know that the committees in the House of Commons are unable to carry out the whole of their functions at present. As I am standing here there are some duties laid upon the House of Commons committees which are not being earned out because of pressure of time.
Therefore the first approach must surely be to let the House of Lords do the work in a complementary way

1327
to the other place—work which the other place finds itself incapable of doing. What is wrong with that? It would be an objective review—getting the right person, helping the Secretary of State and seeing to it that there is parliamentary understanding. It would mean consulting Parliament on the basis of going to the appropriate committee of the one House capable of doing the job. I am sure that is a good idea and I hope the Committee thinks so too.
6.59 p.m.
On Question, Whether the said Amendment (No. 2) shall be agreed to?
Their Lordships divided: Contents, 53; Not-Contents, 91.

DIVISION NO. 2

CONTENTS

Amherst, E.

Irving of Dartford, L.

Ardwick, L.

Jacques, L.

Attlee, E.

John-Mackie, L.

Birk, B.

Llewelyn-Davies of Hastoe, B.

Bottomley, L.

Lloyd of Kilgerran, L.

Bruce of Donington, L.

Lovell-Davis, L.

Burton of Coventry, B.

McIntosh of Haringey, L.

Campbell of Eskan, L.

McNair, L.

Carmichael of Kelvingrove, L.

Meston, L.

Cledwyn of Penrhos, L.

Mishcon, L.

David, B.

Molloy, L.

Dean of Beswick, L.

Mountevans, L.

Diamond, L.

Mulley, L.

Donoughue, L.

Nicol, B.

Elwyn-Jones, L.

Oram, L.

Ennals, L.

Phillips, B.

Evans of Claughton, L.

Pitt of Hampstead, L.

Falkender, B.

Ponsonby of Shulbrede, L.

Fisher of Rednal, B.

Seear, B.

Fitt, L.

Stewart of Fulham, L.

Gallacher, L.

Stoddart of Swindon, L.

Graham of Edmonton, L.

Tordoff, L.

Grey, E.

Underhill, L.

Hanworth, V.

Whaddon, L. [Teller.]

Harris of Greenwich, L. [Teller.]

Williams of Elvel, L.

Wilson of Rievaulx, L.

Houghton of Sowerby, L.

Ypres, E.

NOT-CONTENTS

Ailesbury, M.

Elton, L.

Allenby of Megiddo, V.

Faithfull, B.

Belstead, L.

Feversham, L.

Birdwood, L.

Forte, L.

Boardman, L.

Fraser of Kilmorack, L.

Brabazon of Tara, L.

Gardner of Parkes, B.

Broadbridge, L.

Glanusk, L.

Bruce-Gardyne, L.

Glenarthur, L.

Buckinghamshire, E.

Grantchester, L.

Caithness, E.

Gray of Contin, L.

Cameron of Lochbroom, L.

Greenway, L.

Campbell of Alloway, L.

Grimston of Westbury, L.

Carnegy of Lour, B.

Hailsham of Saint Marylebone, L.

Cathcart, E.

Coleraine, L.

Hardinge of Penshurst, L.

Colwyn, L.

Harris of High Cross, L.

Cork and Orrery, E.

Harvington, L.

Cottesloe, L.

Henley, L.

Craigavon, V.

Hives, L.

Craigmyle, L.

Hood, V.

Cullen of Ashbourne, L.

Hooper, B.

Davidson, V.

Hylton-Foster, B.

Denham, L. [Teller.]

Lane-Fox, B.

Drumalbyn, L.

Layton, L.

Dundee, E.

Lindsey and Abingdon, E.

Elliot of Harwood, B.

Lucas of Chilworth, L.

Elliott of Morpeth, L.

Lyell, L.

1328

McAlpine of West Green, L.

Saltoun of Abernethy, Ly.

Macleod of Borve, B.

Sanderson of Bowden, L.

MacLeod of Fuinary, L.

Sandford, L.

Mancroft, L.

Sandys, L.

Marley, L.

Selkirk, E.

Marshall of Leeds, L.

Shannon, E.

Maude of Stratford-upon-Avon, L.

Skelmersdale, L. [Teller.]

Strathclyde, L.

Merrivale, L.

Strathcona and Mount Royal, L.

Mersey, V.

Milverton, L.

Swinfen, L.

Mowbray and Stourton, L.

Swinton, E.

Munster, E.

Thorneycroft, L.

Murton of Lindisfarne, L.

Tranmire, L.

Onslow, E.

Trumpington, B.

Orkney, E.

Vaux of Harrowden, L.

Rankeillour, L.

Vivian, L.

Reay, L.

Ward of Witley, V.

Renwick, L.

Windlesham, L.

St. Davids, V.

Wise, L.

Resolved in the negative, and amendment disagreed to accordingly.
The Earl of Caithness: In moving that the House do now resume, I suggest that we do not return to further consideration of the Gas Bill until five minutes past eight. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Draft Child Resistant Packaging (Safety) Regulations 1986
7.7 p.m.
Lord Lucas of Chilworth Lord Lucas of Chilworth rose to move, That the draft regulations laid before the House on 5th March be approved. [15th Report from the Joint Committee.]
The noble Lord said: My Lords, I beg to move the Motion which stands in my name on the Order Paper. Notwithstanding the delight that I have that the noble Lord, Lord McIntosh of Haringey, wishes to respond from the Opposition Benches, I wonder whether I may pay my tribute to his noble friend Lord Ennals, who really master-minded what we are considering this evening in taking the initiative in setting up the Child Resistant Closures Working Party, which produced what is known as the Scobie Report and on whose recommendation these regulations are based; because there is no doubt that if your Lordships approve the regulations it will give great comfort to very many people in manufacturing industry and, of course, to the parents of very young children.
The purpose of the regulations is to reduce substantially the total of, unhappily, 10,000 small children who are referred to hospital each year for ingestion or suspected ingestion of household chemicals—substances such as white spirit and paint stripper. I do not have to describe the anxiety and distress that this will save for parents and young children or the desirability of freeing scarce National Health Service resources for treating the sick. Similar measures introduced into the United States have reduced child poisoning by some 30 to 80 per cent., and if we can achieve anything like that here the measure will have been well worthwhile.
The regulations operate by making it an offence to supply to the public the hazardous chemicals set out in

1329
the schedule in containers that have not been approved by the British Standards Institute as child resistant to British Standard 6652. The only obvious omission is household bleach, and that omission is as a result of advice that paediatricians have given that it does not cause serious or lasting injury to young children.
The measure is restricted to liquids that can be easily, as I suppose the expression might be, "swigged" by a child while the mother's or father's back is turned, since these present the greatest hazard to young children. Unfortunately, we were unable to make provision for the elderly or disabled, since this would create too large a loophole in safeguarding young children; but the products covered are not such that the elderly or disabled will need to open them in a hurry and unaided.
The cost of initial approvals will be quite high, but spread over time will amount to only 1p or 2p per container, which is, I suggest, a small price to pay for the safety of small children. In order not to create a barrier to trade in the European Community, we will have to accept closures approved by recognised bodies in other member states, but only—and I emphasise this—if they come up to our standards.
We have consulted across the board. The chemicals industry is content. The packaging industry would naturally like the scheme to be slightly less rigorous and would like more time. But we are giving suppliers nearly two years' grace to introduce child-resistant containers, and we do not want small children to be at risk a moment longer than is necessary. The paediatricians whom we have consulted consider that we have got the proposed scheme about right.
Finally, I should emphasise that the first line of defence really must always be parental vigilance. It is for parents in the house to ensure that products of this kind, as indeed with medicines, are kept as far as possible away from children; but this measure which introduces child-resistant closures certainly might be considered to be a long-stop where parental vigilance fails.
I do not think it is necessary for me to go over the regulations paragraph by paragraph: I believe they are self-explanatory. If there are any points noble Lords wish to make of course I should be delighted to answer them to the best of my ability. I therefore commend the regulations to your Lordships' House.
Moved, That the draft regulations laid before the House on 5th March be approved. [15th Report from the Joint Committee.]—(Lord Lucas of Chilworth.)
7.15 p.m.
Lord McIntosh of Haringey: My Lords, it is my pleasure to acknowledge and add my own thanks to those expressed by the noble Lord, Lord Lucas, to my noble friend Lord Ennals. It was my noble friend who in 1982 introduced into another place the Dangerous Household Products (Child Safety) Packaging Bill. That was far too long a title but it was a very necessary initiative on his part. It was that Bill which resulted in the child resistant-closure working Party, to which the Minister has just referred. I think it was remarkable that the working party, which consisted of a number of
1330
distinguished medical people as well as those interested particularly in child accident prevention, and representing consumers and Members of this House and of another place, was a private working party. It was not actually an official working party sponsored by Government or by any of the major institutions. I understand that the administrative, secretarial and public relations activities were paid for by a grant from the packaging industry and I have pleasure in acknowledging that this initiative, started by my noble friend Lord Ennals and supported financially by the packaging industry, has resulted in a virtual consensus about the steps that need to be taken, in terms of regulation, to deal with this problem of damage to children from swallowing dangerous chemicals in the home and resulting poisoning.
Of course there is no perfect answer to this problem: that has to be recognised. If you make packaging fully child resistant, you are bound to make it more difficult to open for other people, and I believe there have been tests which show that children, who still have an element of lateral thinking which we perhaps have lost, find it is easier to overcome the puzzle of child-resistant packaging, just as young people in their teens are much better at solving Rubik's cube than we are. It could be a problem to have child-resistant packaging which was so difficult that elderly people, for instance with arthritis, might have difficulty in opening the product. However, as the noble Lord has said, none of these is a product which needs to be opened in a hurry. They are household products, and to that extent I am sure the balance is right: in other words, that we should get the packaging made safer as a priority as against a slight inconvenience to elderly people.
There are several particular points which are worth referring to. First, the British Standard which has been quoted deals with difficulty of access to the container. It does not deal with the question of spillage, and if you have been fighting to get something open the risk of spilling some of it afterwards could be that much greater; and some of these products are harmful, or could be harmful, to the skin and to clothing even if they are not swallowed. I wonder whether the noble Lord has any advice to give about that because it leads to my second point, which is the danger involved when products are transferred to other containers, if they are too difficult to get at. For example, if turpentine or white spirit is transferred to a jam jar or if it is transferred to a food or drink container, that is the old case of paraquat in the tool shed in a lemonade bottle, is it not? In that case we may actually be defeating our purpose.
I should like to suggest to the Government that since there is no perfect answer in the form of packaging or of regulations, then these should be accompanied by a programme of education to encourage parents and others living in the home not to succumb to the temptation to transfer dangerous products to other containers but to keep, and continue to keep, dangerous products, even in child-resistant containers, out of the reach of children to minimise the risk of children being left alone in a room where, for example, you leave a paint brush in a jar on the floor after you have been decorating while you go to have a cup of tea. These are the kinds of things where

1331
education and propaganda, as well as regulations, are appropriate and relevant
The noble Lord, Lord Lucas, referred to the American experience where there was a reduction of from between 30 and 80 per cent. in cases reported to the hospitals. But I would remind him that the American Act of 1970 was accompanied by an advertising and educational programme which covered a large part of the United States, and the two together seem to me to be a more effective answer to the problem. However, it is clear from what I have said that we on these Benches welcome the regulations, and think that they perform a useful function. We believe, as the noble Lord said, that my noble friend Lord Ennals has chalked up another credit on his long list of public services to the people of this country.
Lord McNair: My Lords, may I say that of course we on these Benches welcome these regulations? May I also, from a position of abysmal ignorance, ask the Minister one question? Do these regulations cover products which are normally used in the garden or do they cover only products used in the kitchen? En passant, the noble Lord, Lord McIntosh, referred to paraquat, which you can buy in granular form in a package that any child could undo without the slightest difficulty. I wonder whether this is the subject of some other regulations. Perhaps the noble Lord can answer that question.
Lord Lucas of Chilworth: My Lords, I am most grateful to the noble Lord, Lord McIntosh, and the noble Lord, Lord McNair, for their consideration of these regulations. I should like to add to what I said earlier with regard to the noble Lord, Lord Ennals, and to the packaging industry, which has borne the burden of the report that has resulted in these regulations. Without their help, we should not have been able to get so far as we have.
I think that there has to be a general note of warning sounded here; and the noble Lord, Lord McIntosh, mentioned this. We can go only so far in these matters. What we are considering here is child restraint closures and not some of the wider issues that one might like to consider. For example, as regards the point about spillage which was made by the noble Lord, Lord McIntosh, I do not wish to sound unkind but, in a way, that is irrelevant to the safety of the child. If the child gets into the container and is therefore able to spill it, then the closure itself will have failed the test for approval.
Lord McIntosh of Haringey: My Lords, I was not suggesting that that was the risk of spillage. I was suggesting that if the container, in becoming child resistant, had increased the risk of spillage, the temptation would be for the adult to transfer the liquid to another container. That is the worry that I had about spillage and I think it is relevant to the safety of children.
Lord Lucas of Chilworth: Yes, indeed, my Lords; but I am sure the noble Lord will accept the point I made. Accepting what he said takes me on to his second point, about which I should like to say this. First, we are immensely grateful to the manufacturing
1332
and packaging industry for doing so much in regard to general advice to parents, householders and so on, about the storage of products of this nature.
At the end of this year we shall enter into a programme which will be called an awareness campaign of what is meant by child restraint closures. That will also encompass the other general points of advice with regard to the storage of these materials and the recklessness of transferring them into other containers. Several thousand pounds will be expended in this area and we feel that, with general support from agencies which are normally helpful to us, we will get this message across. The awareness campaign will therefore encourage the public to be a little more careful about the storage and use of these hazardous liquids.
The noble Lord, Lord McNair, asked me whether the regulations cover garden chemicals. With his knowledge, I think he will probably understand rather better if he studies the schedule of regulated products. What I can say to him in general terms is yes, but liquid paraquat is not sold retail and it is only products that are sold retail that are covered by these regulations. Obviously, wholesale or trade products that find their way into the home will not be covered, and it is for the suppliers to ensure that they do not offer for sale a product which is known to be used by a retail purchaser. Manufacturers themselves will have to ensure that there is not much spillage from their containers if they are to make their products saleable.
It is interesting that there are a number of companies in competition with each other in regard to the product itself. That competition will undoubtedly be extended towards the packaging and presentation of their products and we believe that, to a great extent, that point will be taken care of. I do not think there is anything else that noble Lords have asked of me. In fact, I do not think there is anything else that I can add to what I have already said. It just remains for me to thank your Lordships and to ask that you approve the regulations.
On Question, Motion agreed to.

Surrogacy Arrangements (Amendment) Bill [H.L.]
7.28 p.m.
Lord Swinfen: My Lords, on behalf of the noble Earl, Lord Halsbury, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Swinfen.)
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL CATHCART in the Chair.]
Schedule 1 [Amendments to the Surrogacy Arrangements Act 1985]:
Lord Swinfen Lord Swinfen had moved Amendment No. 11:
Page 2, line 35, at end insert—
(". In section 4 of that Act (offences) in paragraph (a) in subsection (1) leave out "3" and insert "6".").
The Deputy Chairman of Committees (Earl Cathcart): In calling Amendment No. 11, I should remind the Committee that the debate on it was adjourned at the previous sitting pursuant to Standing Order No. 55. Unless, therefore, any noble Lords wishes to continue the debate I shall put the Question.
Lord Swinfen: Having considered the matter since the Committee adjourned, I now beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 12 had been withdrawn from the Marshalled List.]
Schedule 1, as amended, agreed to.
Schedule 2 agreed to.
House resumed: Bill reported with the amendments.
Lord Skelmersdale: My Lords, I beg to move that the House do now adjourn during pleasure until five minutes past eight.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.30 until 8.5 p.m.]

Gas Bill
House again in Committee on Clause 1.
Lord Diamond Lord Diamond moved Amendment No. 3:
Page 1, line 8, after ("State") insert (", after consultation with the appropriate Committee in each House of Parliament, or with the appropriate Joint Committee of both Houses of Parliament,").
The noble Lord said: We had a short discussion before the break on the general principles of consultation with Parliament. Unfortunately, we were unable to persuade the Government of the wisdom of that course. Perhaps they took the view—and I think this was hinted at—that consulting with one committee of the House of Lords had its difficulties and umbrage might be taken by the other place. I do not think so, but as always we are ready to compromise and to ascertain the extent to which the Government would be willing to come with us. We are therefore proposing this amendment, which has two parts.
The first part states,
"after consultation with the appropriate Committee in each House of Parliament".
I have already explained why I think consultation would be a wise change of direction on the part of the Government. The Government are becoming renowned for their lack of consultation. They have got themselves into difficulty on many occasions. I do not want to detail them but we have only to think of Cheltenham as a first and major example.
If the Government would change their line and start consulting Parliament, they may find that Parliament would not only assist them to avoid making mistakes in the first instance but would be ready to come to their help and succour when things went wrong, as they do go wrong in this world, whichever party is in power. My first point is that there should be consultation with Parliament as an aid to good government, as an aid to
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the relations between Government and Parliament and as an assistance in making sure that they get the right man and consent as to the right man or right woman.
The second part of the amendment states:
"or with the appropriate Joint Committee of both Houses of Parliament".
I have already indicated what I mean by "appropriate committee". There is already in the other place an appropriate committee ready to take on this duty. There are at least two committees in this place which would be ideal for the purpose. It would be for this Chamber to suggest to which of those committees it remitted this responsibility. There is no difficulty in finding useful and objective committee members to carry out this function, with benefit to relations between the Government and Parliament, for the protection of the consumer and for the efficiency of the industry.
The second point in the statement,
"or with the appropriate Joint Committee of both Houses of Parliament",
is this. I view with considerable affection the idea of the two Houses working together. As the Committee will know, there is a moderate amount of joint working in committees at the moment. This is a fruitful way forward. The House of Commons cannot carry out its functions because of the extreme pressure of work and the inability to find time for it to be done. This often means that matters which ought to be decided by Parliament are delegated and are not decided by Parliament. Not only is that the case, but the other place finds itself unable to man committees which are particularly time consuming. One thinks in particular of Private Bill Committees.
The work of the other place is not carried out fully, and that is a great danger to democracy. That is what the other place is for. It is so bogged down with work despite the fact that, these days, every Member there is a full-time Member who is able by virtue of the remuneration he receives to be a full-time Member. Even so, they are not able to carry out duties that Parliament has laid upon them.
One of the ways in which the burden and volume of work resting upon the House of Commons can be reduced would be for the House of Lords to help. If there is a joint committee, that means only half the number of Members of another place being involved. If some Members feel, as they sometimes do in a joint committee, that they have more pressing responsibilities and are unable to attend, and if they leave it to Members of this House who are very public spirited and willing to put in the time, and who perhaps have a little more time available, the work will be done and well done, and Parliament will be fully consulted.
That is a development which we ought seriously to encourage. It is very good for the House of Lords that we should be able to demonstrate our ability to come to the aid of the Commons whenever necessary. That is one of our functions—to complement the work of another place. Here is an example of our doing that very thing. For all those reasons I hope that the Minister will look favourably upon this amendment. When speaking on the previous amendment he

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encouraged me by indicating that although he did not look favourably upon it, he might look favourably upon other amendments. This amendment, which is an alternative to that we have already discussed, might therefore fit the bill. I hope very much that it will. I beg to move.
Lord Stoddart of Swindon: I listened very carefully to the arguments in the previous debate. I listened particularly carefully to the noble Lord, Lord Gray of Contin. I have to say that I was very surprised to hear the noble Lord, who, generally speaking, I consider to be a man of progressive thought, brush aside the very reasonable proposition that was made.
The noble Lord certainly did not apply the mind of a radical to that amendment. I hope that he will be more radically inclined towards this particular amendment. As the noble Lord, Lord Diamond, has said, this amendment seeks to ensure that both Houses of Parliament have some input—though not very much—into the appointment of the director of Ofgas.
The noble Lord, Lord Gray, stated that if we had the system proposed, there would be a delay in appointment. He cited in his own aid the experience of the United States. However, there is absolutely no reason why there should be any delay. A Select Committee of either House or of both Houses can be summoned at very short notice. I do not expect, and I feel sure the noble Lord, Lord Diamond, does not expect, that there will be hearings lasting for days. I should have thought that one hearing would be adequate. So what delay would there be?—hardly any, if I may say so. Frankly, that excuse—because that is what it was—is not worthy of the noble Lord, Lord Gray.
8.15 p.m.
I do not understand why the Government should have so little confidence in the Select Committees that they are not prepared simply to say to them: "This is our appointment. We should like you to interview and to have your point of view". The amendment does not ask that the joint committee should appoint. It merely asks that Parliament should be consulted. Why should it not be consulted?
Here we have a situation where British Gas is being privatised and regulated and where Parliament is to be kept very much at arm's length. It simply is not good enough for the noble Lord to say that Parliament has an input because the report of the director will be placed before Parliament. That really is quite laughable, and the noble Lord knows it, because he has long experience in another place and he has detailed experience of your Lordships' House.
If we believe in Parliament, if the Government believe in Parliament, and if they believe that Parliament should be playing a greater role, surely they should say in this instance, "Let us as an experiment have a situation where in making this appointment we allow a Select Committee or a joint committee of both Houses to look at this man, ask him a few questions, and then see whether it has any points that it wishes to make to us".
In another place I served on the Select Committee for nationalised industries. That Select Committee
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undertook an examination into that matter. Certainly the Government were opposed to it. If my recollection serves me correctly, the chairmen of nationalised industries were opposed to a Select Committee having any input. Nevertheless, the Select Committee, or at least most of its Members, came to the conclusion that it would do no harm at all for there to be some relationship involving the chairman of a nationalised industry—or, as in this case, the director of a regulatory body—and for there to be some input and some contact between the candidate who had been put forward by the Government.
There is another point—
Lord Diamond: Before the noble Lord moves on to that other point perhaps he will be good enough to assist me. I have been following very carefully what he has said about his experience on the Select Committee and that is very valuable. Would I be right in assuming that the majority of the members of the committee, which came to the conclusion that he defined, were supporters of the Government?
Lord Stoddart of Swindon: Yes, indeed they were.
I again return to the last debate, because I want to emphasise the point that Select Committees are independent bodies. They do not discuss matters on the basis of party politics. They discuss matters and come to their conclusions on the basis of the evidence. Again I cite my own experience, this time with the Select Committee on energy, which investigated the Government's nuclear power programme.
I can safely say that at the beginning of that inquiry most members of the committee—and perhaps I was the sole exception—supported the Government's nuclear energy programme. But at the end of the inquiry, after we had heard the evidence and paid the visits, it was a different story. Indeed, members of the committee who had previously been in favour of the policy had turned against it. That was on a cross-party basis. It did not have anything to do with Labour and Tory; it had everything to do with hearing the evidence and seeing and assessing the facts. That is how Select Committees work, and that is why it would be a very good thing if they had an input into the appointment of the director.
There is another point. It would strengthen the position of the director himself. Here would be a man who had not merely been appointed at the whim of a Minister, perhaps from a list of the great and the good. He would have been before a parliamentary committee and obtained its confidence. A man appointed in that way would feel very much stronger and, indeed, we should have much more confidence in him.
I have a further point. It tests the calibre of a man, even a Secretary of State, to appear before a Select Committee of either House. If a man, an appointee of the Minister, can go before a Select Committee and convince it that the Minister has made the right appointment, by heaven, if he can convince a Select Committee of that he is the right sort of man to be dealing with the Denis Rookes of this world.
For all those reasons I hope that on this occasion we shall hear from the noble Lord, Lord Gray, that he will

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support us. I say to the noble Lord, Lord Diamond, that it may be too much to ask the Minister to give a decision tonight because he has only just heard the debate. But if he cannot support the amendment and say that he will accept it, I hope he will at least say to us, "I have listened carefully to what you say. I am a parliamentarian. I voted for the Select Committee system when it was put before the House by one of my right honourable friends, Mr. St. John-Stevas, and I should like to think about this and come back to the Committee at a later stage and perhaps give some encouragement".
I do not think I am being unfair to the noble Lord; I like him. That is one of the problems. I do not like being tough with him and, therefore, I am giving him this opportunity, which I hope he will take, of saying that he has listened carefully to this interesting debate and will be able to offer us encouragement.
Baroness Seear: I hope the noble Lord the Minister will not give us the same answer as on the previous amendment. It must be apparent to the Government that there is grave concern about the position of the consumer when an industry which is either entirely or very nearly a monopoly is being privatised. I am sure the noble Lord will also agree that nobody seriously thinks that under the old nationalisation Acts the position of the consumer was adequately dealt with. I know there have been occasions when consumer councils have done well, but nobody pretends that we have ever found the answer for the proper protection of consumers under nationalisation and where there is a monopoly, either private or public.
We are not filibustering on behalf of the consumer. I beg the Minister to recognise that we are deeply concerned that the position of the consumer under a monopoly never has been solved; that is especially so for a monopoly like the gas industry, which is dealing with a commodity of great importance to a very large number of people. Nothing satisfactory has ever been devised, so surely this is a good argument for trying something new. The Minister will forgive me for saying that there was a degree of complacency in his statement that these old methods have been tried and proved successful. We do not agree that they have been successful. If they have not, that is a very good reason for trying something new.
Finally, I should like to ask the Minister to reply to this question. He told us that the Secretary of State has his advisers. With all due respect to the Civil Service, does the Minister really think that full-time career civil servants have the same kind of knowledge and expertise that can be mobilised from the industrialists, the trade unionists and the other experts in this House who could bring their knowledge and experience to bear when deciding who is a suitable person? If so, where do they get that experience which equips them to do that?
Lord Whaddon: I find as I grow older that my memory increasingly plays tricks. I have been trying to remember the name of the poet who wrote a poem that was a great favourite of mine. In that poem he explained how his heart yearned to go back over the ground that he had once trodden, to retrace his steps
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and so be able to take a different path from the one he chose, and how in life it was so unusual to have such a chance. One is nearly always forced to live with decisions unfortunately taken in past years.
The Minister has a rare opportunity tonight to retrace the steps that he unfortunately took an hour or so ago, when most convincing arguments were put to him for consultation with this House in the appointment of the officer. It seemed to me that just before we adjourned for dinner the Minister was somewhat embarrassed. I thought I caught a glimpse in his eye of his having been persuaded; that he felt the force of the arguments but that the forces of the party behind him were pushing him to resist. On this side of the Committee we have always felt that the noble Lord has rather more backbone in him, if we could only dig deep enough, and that given the persuasion in his own mind he will stand up and do the right thing, which clearly he knows is to yield on this point.
Having said that, I feel the need for a little clarification from one or two colleagues who have spoken. For example, I understood the noble Lord, Lord Stoddart, to say that one meeting should normally be sufficient for a Select Committee. Perhaps I misunderstood him but I am sure I heard him say that. I am sorry but I must take issue with him. For such a vitally important appointment the man chosen—I beg the pardon of the noble Baroness, Lady Seear; the man or woman—to take this position will require heroic qualities. It could easily take half a dozen sessions, in my opinion. However, if I have misunderstood, I stand corrected.
Lord Stoddart of Swindon: I was seeking to show that it would not be necessary to have a long series of meetings. After all, we are not asking for an appointment board but for consultation. Therefore, because what we are asking for is so small, I feel that probably in most cases one meeting of the Select Committee—a day's meeting—would be adequate.
Lord Whaddon: With deep respect to the noble Lord, I appreciate what he says and I know that he means it. But consider today's proceedings. Apparently simple amendments have led to endless points of great gravity which deserve thrashing out. I feel it is overwhelmingly likely that for this appointment there will be endless points needing clarification.
Consider what this man or woman will have to face every day. There will be economic questions. We have heard mentioned today short-run or long-run marginal costs. Bless me! I am not sure what those are and perhaps someone can enlighten me. But the new officer will clearly have to be clear in his own mind, because this will be an everyday occurrence for him.
As regards the technical side of economics, I think that he will need to be an expert in thermodynamic physics. I gave earlier an example of how the correction of an apparently simple fault in everyday service turned upon the interpretation of European regulations and on what one or two companies had interpreted those regulations to mean. If he is effectively to represent consumer interests, he must have some appreciation of these matters. So he must have some knowledge of the technical side of

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economics, and certainly he must know about administration. He, or she, will have to be a first-rate administrator, because there will be a most important organisation under his authority.
8.30 p.m.
These are matters which I can immediately pick out which will have to be faced every day by the new officer. I find it very difficult indeed to believe that one meeting will cover the abilities of the new appointee in the various fields in which he will have to operate. The noble Lord, Lord Diamond, made out a very convincing case, but I find myself somewhat perplexed. I am convinced of the need for consultation, but the noble Lord has somewhat confused me and I should be grateful if he would clarify the situation.
When speaking on the previous amendment, he completely convinced me of the need for consultation with a Select Committee of the House of Lords. An hour later we are now discussing consultation with a committee from each House of Parliament, or a joint committee. The only difference between this amendment and the previous one lies in the position that it occupies in the Bill; they are a few words apart. I cannot see why wording similar to that in Amendment No. 2 could not have been put down again as Amendment No. 3 in a different position. I find it very difficult to swallow a change in the form of the Select Committee which is to be consulted from a committee of the House of Lords, (which I think is clearly the correct body to supply such expertise) to a Select Committee of the House of Commons or a Joint Select Committee with the claim that they could do the same job. I should be grateful if the noble Lord would take the time to clarify this point for me and help me to make up my mind.
The noble Baroness, Lady Seear, spoke of the need for control of a monopoly, whether it be a public or a private monopoly. In principle she is right, but I have always believed firmly that it is much more difficult to control the public interest with regard to a private monopoly than it is with regard to a public one. The interests of a private monopoly are plainly to maximise the profit. I think that there is a clear case to be made out that the public interest needs a much more skilful and extensive body to guard it than is the case with a nationalised industry.
I agree with the noble Baroness that the problem of adequate representation for consumers' interests with regard to the nationalised industries has never been adequately solved. She is absolutely right about that. But in the case of a private monopoly, the difficulty is even more acute, and therefore the amendments that we are now discussing assume an even greater gravity. I shall be most grateful if the noble Lord, Lord Diamond, could clarify my mind in regard to this amendment.
Lord Diamond: I do not know whether it would be more convenient to wait for the noble Lord the Minister to reply or whether I should deal at the moment in a limited way with the questions which my noble friend Lord Whaddon has put to me, which I am very happy to do.
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My noble friend found himself impressed by the many qualities that are required of the individual man or woman who is a candidate for this most important job. I entirely share his views about the magnitude of those qualities and the experience required. My noble friend went on to deduce from that that there might be need for more than one sitting of a Select Committee to satisfy appropriate consultations.
Lord Gray of Contin: He said six.
Lord Diamond: I shall give way to the noble Lord gladly if he wishes to say something.
Lord Gray of Contin: I am always prepared to help with a filibuster. If I heard the noble Lord correctly he suggested that the committee might need six sittings to come to such a decision, but I thought that that was rather at variance with the noble Lord's own view. No doubt he will clarify that point.
Lord Diamond: Indeed I shall.
Lord Whaddon: I think I am entitled to speak, since a comment has been made about my own remarks. I plucked that figure out of the air. Let me clarify what I was saying. It concerns the difficulty and complexity of the industry, which is not a matter of sticking gas into one end of a pipe and taking it out of the other end. It is an immensely complex industry which is full of technological and economic problems as well as of personnel problems. The chief person responsible for dealing with consumer representation will have to be a man or woman of outstanding ability.
I simply used the figure six in a poetic sense, if I may say so. I believe it is a virtual impossibility to cover the ground adequately in one session. Heaven knows, it may require a dozen sessions or more. I simply believe that it will need thorough—the noble Lord smiles, but we are dealing with a multi-billion pound industry which has 16 million customers. We must treat it with the gravity that it deserves.
Lord Gray of Contin: I am most grateful to the noble Lord, and I accept that, as he himself said, he plucked out the figure of six, but he has now plucked out the figure of 12. If one of the serious arguments for this is that there would not be delays, I have suggested that it would lead to delays. Really the noble Lord is making my case for me.
Lord Diamond: Perhaps I may continue with what I was trying to explain before the noble Lord the Minister sought to delay progress by intervening in the way he did. It was a very unhappy intervention, if I may say so. I may have been mistaken but I thought that the noble Lord allowed a word to escape his lips which was quite unintentional. I thought he used the word "filibuster".
Lord Whaddon: Yes, he did.
Lord Diamond: I hope that the noble Lord, when he has had an opportunity of reading Hansard, will explain which of the comments of any individual named on this Bill from either side were irrelevant to

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the issue. That is the definition of a filibuster. Perhaps he will be good enough to do that for us. In the meantime, I reject totally what he has said. May I throw the word straight back at him and say that I very much regret that he chose to use a word such as that when we are trying to deal with a most important Bill of this Session to which we have given a Second Reading without hesitation and without amendment of any kind. I very much regret that the noble Lord allowed himself to use that word even jocularly, and I can only assume that it was jocular.
As I said, my noble friend Lord Whaddon was impressed by the many qualities that such a prospective employee would need to have. That is right. He is absolutely right to be weighed down by a sense of the magnitude of the experience and qualities and knowledge that such an individual would have to possess. To go on from that to say that consultation would take a long period is, with respect, not necessarily correct. There is no reason to jump from one statement to the other. But the fault is mine for not having explained the intention behind this amendment. I am bound to do so now; otherwise, this misunderstanding will continue.
It is not intended that the Select Committee should go through the details of an appointments board and ask all the questions that an appointments board would have to ask before making an appointment to an important position of this kind. The amendment refers to consultation. And it is only consultation that those of us who approve this amendment have in mind. Why do we say that? It is because we know that when an appointment is made in Whitehall much ability and experience goes into the selection of the individual before his name is put before the relevant Minister. There is, however, a great and enormous gap in the experience of those who collect the views in order to make the decision; there is an enormous gap in their knowledge and experience. They are very able civil servants and, no doubt, very able people of all kinds. But they are not politicians. They are not people who have their ear to the ground. They are not individuals who attend political surgeries every week and hear the problems of their constituents. They are not people with that kind of experience.
In order to fill that important gap a wise government—I say this without hesitation—would prefer to have the support of a Select Committee. In such an important appointment as that which we are discussing, should things go wrong, as they have already, the Government would have the backing in the future of the Select Committee and the individual in question would know that he could not be pressurised into doing the wrong thing because he depended solely on the Secretary of State. That would not be the case. It would partly be a question of the view taken by Parliament because Parliament had, through consultation, accepted that in general terms he was the right man for the job.
I would therefore say to my noble friend that it is certainly right to assert that the individual in question would need to have enormous experience, wisdom and ability. But the task of consultation, in my view, could easily be carried out in one session. Members of
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Parliament, who are continually meeting new people, have the facility, as the Minister will agree, to be able to assess characters very quickly. It is something that they learn very quickly.
I have no doubt that consultation would easily be achieved within the scope of one meeting. The delay of seven days that might be caused would be far less an argument than the argument I have already deployed of having the right man acceptable to Parliament, with good advice available to the Secretary of State together with support for the Secretary of State who would know, if difficulties arose, that there had been this consultation.
I agree with my noble friend that the amendment is not as good an amendment as the first one. The first amendment related to consultation with a committee of your Lordships' House. It would have removed any possible charge of partiality and political partisanship and there would have been no problem of putting further work on to over-loaded Members of the other place. Unfortunately, that amendment was not accepted. It was, as already stated, brushed aside. I hope, therefore, that as we proceed to put forward by way of compromise suggestions that are less acceptable on this side of the House but, as a consequence, we trust more acceptable to the Minister, there will be developed an attitude of goodwill that will enable us gradually to find some meeting of minds. I hope that this amendment will be such an occasion.
8.45 p.m.
Lord Whaddon: I am grateful to my noble friend for that clarification. I must take issue with him over his opinion that one session would normally be adequate. My noble friend has years of distinguished service in financial matters. Who was it who said that accountants know the cost of everything and the value of nothing? They take a limited view. It is a very necessary and essential view, but also a partial view. It relates to only one aspect. I am afraid that my noble friend has tended to take too narrow a view of this job. I am constantly impressed by the explosion of technical expertise and technical development in the world that is rising exponentially and that will continue to go up. I remember some years ago being involved in a two-month fight with the Government over a change of one word in a Bill. It related to the chemical industry, my own industry. The Bill referred to duties that would be refunded for mixtures. The word should have been "compounds". I explained to the Ministers concerned that there was a vast difference between the two words. They could not see it. The reason was that they were not skilled in the arts of chemistry. It took many weeks, with millions of pounds hanging on the outcome, to get that one word changed. The same will be increasingly true of the gas industry.
It is not simply a matter of putting in large amounts of gas at one end of the pipe and taking it out in small amounts at the other. Increasingly the private company will find itself under the pressure, always experienced by private companies, of trying to maximise profits. When we have finished with the Bill the salesmen of British Gas plc will come forward as

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never before in the gas industry and they will be under pressure to sell not just gas but also added value components to the service. They will be told that they are selling service and value and not just selling therms of gas. If they can sell an electronic device, a timer or an infra-red control which means that the housewife need never go to the stove but can simply press a button from her armchair, they will find that they are selling love and care for the family and not just so many therms. In return they will be able to collect for their shareholders a much higher premium. This is where the real danger will lie in the future.
It is relatively simple to keep control over the price. We have seen this incomprehensible jargon that we shall be discussing later in the Bill by which the price per therm shall be governed. I believe that on the whole this is liable to work. The real danger to the consumer will not be the price per therm—that will be relatively easily looked after—but the extras. How many housewives are aware of the pressures that will be put on them? Increasingly these days householders are rung up by people saying, "Have you got this device or that device?" There is also the pressure from television advertising showing that the really "with-it" family will have an electronic device on their stoves and that it only costs an extra £75. What is not disclosed, of course, is that as a condition of having the device there will be a maintenance contract costing £ 100 a year and that within five years the device will be overtaken by a new super device, and that they should scrap the one they have and buy a new one. I might inform the noble Lord that only yesterday—
Lord Swinfen: I wonder what relevance what the noble Lord is saying has to the amendment under discussion.
Lord Whaddon: I am grateful to the noble Lord for bringing me back to the subject. I can explain to him. As he appreciates, this is a complex matter. I am trying to explain that the whole regime under which a private company operates is different from that under which a public nationalised monopoly operates. Heaven knows! we have been told that this will lead to greater efficiency. Perhaps it will: I hope so. But there is another side to the coin. There are dangers of which we must be aware. We are trying to protect the Government from rushing ahead, putting their foot in it and creating difficulties not only for themselves but for the consumers.
I am trying to get across this point. Boards are working to maximise the profits of private companies, which is their main duty. If the noble Lord buys shares in this company he will be anxious for it to increase its profits. He will like to see it advertising new devices which will have a higher profit margin. He will know if he has been concerned with private companies that the salesmen are constantly told by the boards "Go out and sell this adjunct, this additive, because it has a higher profit margin. We do not make our money on the bulk. We make the main profits on the little additives here and there". This will apply to gas in just the same way. We have seen this in other industries.
The safeguarding of the public interest requires that the officers concerned with the protection of the public must be aware of the pressures operating on the
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salesmen. They will only be doing their job, but unless we protect the public they will be in danger of being exploited.
The appointment we are considering tonight must be of a man or a woman fully aware of these dangers. If a Joint Committee of the House of Commons or the House of Lords is not aware of this, then it needs to be. Who else will protect the public?
I should have preferred the previous amendment. That referred simply to an appropriate committee of this Chamber. But I realise that that cannot be so at this stage. I therefore bow to the wisdom of my noble friend and I am willing to agree with what he has suggested in this present amendment.
Lord Williams of Elvel: I want to make two points very briefly. First of all, this is the last amendment, as I understand it, which deals with possible parliamentary control or influence on the appointment of the director at this stage of the proceedings in Committee. Once we pass this amendment we then get on to different matters. If the amendment is not accepted we then lose, it seems, the ability of Parliament to influence the appointment of the director.
I do not want to repeat what I said at an earlier stage. The appointment of a director is, from our side, a fundamental question. The director's office will form a separate government department. He will have his own Vote. He will be his own accounting officer. I do not think that one can lightly brush that aside as not being a consideration of the utmost importance.
The second point is that by introducing some form of parliamentary consultation on the appointment of the director there would automatically be parliamentary consultation on the reappointment of the director or the appointment of a new director. Therefore, although it might be a one-off position at first, nevertheless, when he came up for reappointment, Parliament would in some form have its input to make. I very much hope that the noble Lord the Minister will recognise these as being serious points, because it is a matter of importance to this side of the Committee.
Lord Gray of Contin: We have had another fairly in-depth discussion on this matter. I do not think I would volunteer to act as arbiter between the noble Lords, Lord Diamond and Lord Whaddon. I do not think either was able to convince the other, and neither has been able to convince me.
I am quite sure that we should consider the additional difficulties which would be raised by consultation with both Houses of Parliament. Suppose, for example, that the committees of the different Houses had totally oppposed views. How would that assist the Secretary of State? It is far better to proceed as we propose in this legislation and leave the clause as it stands. We should leave the matter to the Secretary of State who will be responsible, like any other Minister, to Parliament for his actions, and he will have to defend these in the normal way in Parliament, if necessary.
I should also add that under this Bill the Secretary of State in exercising any of his functions, including that

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of appointing the director under Clause 1, will have to be guided by his duties under Clause 4. We shall debate these more fully before too long—or perhaps not for quite some time at the rate we are going at the moment—but time will pass and we shall debate Clause 4 ultimately. The Committee can look again at what is proposed there and will have another opportunity of discussing it.
I thought that the point made by the noble Baroness, Lady Seear, was worthy of note. She was concerned about consumer protection. The noble Baroness, in an eloquent speech, in my view put the case for privatisation. I thought her speech was an excellent one, which highlighted the benefits of privatisation. I have no doubt that some of her colleagues opposite may find that a little uncomfortable but I certainly found that I was in agreement with much of what she said.
Baroness Seear: I spoke of the benefits; but I was also underlining the dangers.
Lord Gray of Contin: I did not suggest that the noble Baroness did not make a balanced speech and had not considered both angles. I was particularly attracted to the benefits, she will not be surprised to hear. However, as I was saying, a new approach is needed in order to protect the consumer properly. That is what we are providing under the Bill.
The noble Lord spoke about the advice from the Civil Service to the Secretary of State. He asked whether such advice will be given to the Secretary of State. The answer is, yes of course it will. He will have the opportunity of listening to advice from other sources, too. I am quite sure that in making this appointment the Secretary of State will give full attention to and take full account of all the advice put to him from any quarter, including that from Members of this Committee and indeed from Members of the other place. However, that does not mean that it is necessary to write into the legislation the proposals which the noble Lord has put forward any more than it would be appropriate to have written in the proposals which were debated on Amendments Nos. 1 and 2.
I must make this point. These amendments were not brushed aside by the Government. They were brushed aside by Members of this Committee. They went to the vote and were defeated. They were defeated by the Committee. That is a point of which we should not lose sight. The noble Lord, Lord Stoddart, used for him a not very convincing argument. He sought to use his experience as a member of the Select Committee which studied nuclear power and which eventually came out opposed to nuclear power—with reservations about nuclear power.
Lord Stoddart of Swindon: The noble Lord is completely wrong. It did not come out against nuclear power in any sense at all. It said that part of the Government's nuclear power programme was not correct and it criticised the CEGB. But it is completely wrong to say that it came out against nuclear power; quite the reverse.
9 p.m.
Lord Gray of Contin: I withdraw that. Of course, I apologise to the noble Lord. I did not mean to misrepresent him in any way, and if that is the correct fact, then I withdraw. He used the argument to support the fact that here was a Select Committee which had come to a conclusion with which I did not agree; nor, I think, did a great many other people support it. Nuclear power has made a very significant contribution to energy in this country. Indeed, that element of the Government's energy policy which included nuclear power has contributed substantially to it; so I did not find that a very convincing argument for using the Select Committee system for the purpose which is suggested by the noble Lord, Lord Diamond.
The noble Lord, Lord Diamond, in talking about political input to appointments, spoke about the need for political input from those who have political surgeries, for example; in other words, Members of Parliament who are used to assessing these things. That is precisely why we are giving the power to the Secretary of State. We are giving it to a politician, if that is what the noble Lord wants. He suggests that he wants a political input. He himself suggested that the Secretary of State was a politician, as he always must be, of whatever party, and he has the power under the Bill to make the appointment after availing himself of the best guidance and opinions available to him.
This has been a useful 56-minute debate, but I am as unconvinced as I was in minute one. I thought that the exchange which took place between the noble Lord, Lord Diamond, and the noble Lord, Lord Whaddon, highlighted the difficulties which exist. Those who are commending this measure to the Committee would need to get their act much more together and to give a much more convincing argument before the Government can consider it. Therefore, I must ask the noble Lord if he is prepared to withdraw the amendment, and would tell him that if he insists on pressing it I shall have to oppose it.
Lord Bruce of Donington: The noble Lord disappoints us a little. Nobody who has spoken so far has tried to take any power away from the Secretary of State. All that has been imposed on him is the obligation to consult. The noble Lord will observe that there are alternatives proposed within this particular amendment. It says:
"after consultation with the appropriate Committee in each House of Parliament, or with the appropriate Joint Committee of both Houses of Parliament,".
The option is there. If, for example, he consulted the Select Committee in the Lords and the Select Committee in the Commons and they gave him conflicting advice, he would act on the best of his judgment, but at least he would have consulted with them. That is really all that is required.
The noble Lord has brought all this upon himself really. He started off with a proposition that one of the main reasons for the introduction of this silly Bill was that the Government departments are not capable of giving effective guidance to a nationalised industry, that they are interfering and that they are bureaucratic. The intellectual limitations placed upon the department of state are intellectual limitations that he himself has imposed on them: either they are capable

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of advising him properly or they are not. If they are capable of advising him and he can arrive at wise decisions, there is no point in privatising the industry at all.
The whole essence of the proposal is to remove it from bureaucratic control, thereby implying that all bureaucratic control is dumb and unintelligent and is incapable of arriving at the correct conclusion. The noble Lord wants to have it both ways. He wants to call the Civil Service fools, which is what he is doing in polite language. Nobody can say that this present Government have done anything other than hurl veiled insults at the Civil Service ever since they have been in office. Yet he is now depriving himself of skilled advice from either House of Parliament.
The Minister himself needs a little education. If the Committee refers to pages 6,7 and 8 of the Marshalled List of amendments, they will find occupying many pages—to be put in as a Schedule at our suggestion—the authorisation to be granted by the Secretary of State for Energy to a Public gas supplier under Clause 7. We shall want to know whether the Secretary of State for Energy to a public gas supplier under Clause 7. We shall want to know whether the director-general who is appointed will have to understand it thoroughly. I doubt whether, despite the skill of the noble Lord's Parliamentary draftsmen, his bureaucracy—the term is his—can understand it either. The necessity for having consultation before the new director is appointed is therefore all the more necessary.
The noble Lord has referred to delay, such as the delay that occurs sometimes, as the noble Lord Diamond said, when a matter goes before the Senate in the United States. Why is the time factor so important in getting this new privatised set-up actually in operation? What is the urgency about it? Where is the public clamour for it? The only urgency is that the Government want to get their hands on the cash in order that they can make the appropriate tax reliefs before the general election. That is the only reason for urgency. This is not public duty, and I invite the Committee to reject any suggestion that this process as suggested by the noble Lord, Lord Diamond, would result in undue delay.
I sincerely hope that the Committee will dismiss the explanations given to it by the Secretary of State, which I must say are unworthy of the noble Lord, and that they will vote for this very sensible amendment.
Lord Diamond: I am grateful to the noble Lord the Minister for such attention as he felt able to pay to the arguments which we put forward in supporting this particular amendment. I am also grateful to him for drawing attention to the fact that we on these Benches are prepared to discuss the matter with great objectivity, no matter whether or not it results in differences of view. I am delighted that my noble friend Lord Whaddon, who has far greater experience in this field than I, was so impressed by the weight of experience, skills and ability that would fall upon the proposed regulator that he felt that even the process of consultation could not necessarily be carried out in one meeting of the Select Committee.
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There is a difference of view about how long it will take to do something which one has never tried to do before. There is no problem about that on this side of the Committee. We do not feel regulated to troop in upon getting the telephone call, as Members do on the other side of the Committee. I have my simple methods of ascertaining whether the final call is coming through because there are two or three noble Lords who always turn up on that occasion. They are good friends of mine and they enter the Chamber at the end of the argument in order to walk into the appropriate Lobby as good, noble and loyal members of the Government. That is how they proceed on that side of the Committee. So be it. However, we do not proceed in that way on this side of the Committee. I am very grateful to the noble Lord for drawing attention to the fact that we are able to express differing views as to what might happen in circumstances which so far have never occurred.
I return to what the Minister said about the actual amendment. The noble Lord objected to my statement that he, and therefore the Government, had brushed aside the views that we had put forward on the previous amendments. I stick to that. It is unfair of the noble Lord to blame that brushing aside onto the Committee and say "It is the Committee which made these decisions; it is not us, the Government". Of course it was "Us, the Government" and of course, as I have already indicated, some noble Lords and noble Baronesses were present throughout the debate and listened to it all. They were fully aware of all the details and therefore fully entitled to take whatever view they did in fact take.
As we all know, that does not apply to all those Members who come rolling in either after the Division Bell or at the point when the debate is nearly over. Therefore, the noble Lord ought to stand by his own responsibilities. It was he who brushed aside our arguments and we regret that very much. As has already been indicated, many aspects of the last amendment are better than this particular amendment. I still believe that the noble Lord ought to accept at least this amendment, which only goes as far as suggesting that the Secretary of State should consult, and in that sense should have cover from Parliament. I do not know what has happened to Ministers these days.
Noble Lords: Go on!
Lord Diamond: I do not know what has happened to Ministers these days and I also do not know what has happened to the normal courtesies which apply. As I was saying two or three minutes ago, I do not know what has happened in these latter days but I hope very much that the Government will accept—
Baroness Gardner of Parkes: I thank the noble Lord for giving way. Perhaps I may point out to the noble Lord that those sitting in the second row of seats find that their voices are heard only with great difficulty in other parts of the Committee. On this side of the Committee we often have considerable difficulty hearing the noble Lord. I know from experience that one has to be in row one or row three in order to be

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picked up by the microphones. Therefore, perhaps I may ask the noble Lord to speak a little more clearly.
Lord Diamond: I am most grateful to the noble Baroness. What she has said is absolutely right. For the past three years we have been dogged by this problem. We have been told that in many quarters of the Chamber it is impossible to be heard from this Bench. We have tried every way of inviting the authorities to provide stronger or differently placed microphones, but unfortunately that has not been done.
Lord Whaddon: Will my noble friend give way?
Lord Diamond: No, not at the moment. Albeit I am grateful to the noble Baroness for her remarks, I am even more grateful to her for not saying "We cannot hear you on this side of the Chamber, thank God"!
In winding up on this amendment I respond to what the noble Lord the Minister has said by saying that it is a pity that the Government seem determined to take the view here and on other occasions that consultation with Parliament is a time-wasting effort. It is very unwise. The Government can save themselves lots of criticism and trouble later. It is a good investment to get cover in Parliament by a Secretary of State putting forward in the appropriate way his views, and consulting. We are not asking for anything more than that. I want to impress on the Minister how keen we are that some amendment of this kind should be accepted.
I know that the Minister did not reject it completely out of hand, and he invited me to withdraw the amendment. I am going to suggest to the Committee that perhaps the best thing would be to consider carefully what the noble Lord the Minister has said, and when we have had a chance to read the Official Report to come back again—and we shall certainly be coming back again—at the Report stage with an amendment which is more suitably drawn.
9.15 p.m.
Lord Gray of Contin: I am grateful to the noble Lord for giving way. It is of course his pleasure whether he withdraws the amendment and comes back at a later stage or not, but I must make the record clear. What I said was that if he sought to force the amendment, then I would have to oppose it. I did not suggest to him to take it back and look at it again, because that would give the impression to the other side that I was prepared to look at this again myself. I am not prepared to look at it again. If the noble Lord cares to bring it back in another form that of course is his pleasure, and we shall consider it at that time.
Lord Diamond: I was not suggesting more than that. I was not putting any words into the Minister's mouth. We on this side have to take what small crumbs of comfort we can. We know that we are in a situation in which, whenever they want to do so, the Conservative opposition can vote out any proposal we put forward. We realise that full well. We know that whatever the merits of the argument we cannot convince the Committee if they are not here to listen to the arguments, but if they come in in droves and vote us
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down. Therefore, we have to be satisfied with crumbs from the rich man's table.
It is in that respect that we look forward to having a further discussion when time has been given for the Government to realise that there is a major widespread criticism of this Government's attitude that they do not consult, and that in particular they do not consult Parliament. It would be wise for the Government to take that criticism on board and do something about it. In the meantime, I hope I have leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Stoddart of Swindon Lord Stoddart of Swindon moved Amendment No. 4:
Page 1, line 8, after ("officer") insert ("with detailed knowledge of the gas industry and of consumer interests").
The noble Lord said: This, I suppose, is the fallback amendment. We discussed earlier this afternoon in the amendment moved by the noble Lord, Lord Ezra, the possibility of setting up commissioners rather than an officer. But the Committee this afternoon—in my opinion unfortunately—decided to reject that amendment. It may well be that there will be another opportunity for them to discuss a similar amendment at a later stage of the Bill. Nevertheless, this amendment seeks to ensure that any officer who is appointed should have a knowledge of the gas industry and of consumer interests.
It is a short but important amendment which attempts to write into legislation the necessity for the director general to have a knowledge of the gas industry as well as consumer affairs. The British Gas Corporation is a formidable organisation to attempt to regulate. It is a private monopoly with over 90,000 employees and massive resources.
As we have heard this afternoon, the United States regulatory experience has shown that regulators need to be familiar with the industry if they are not to be out-manoeuvred, and the performance of Oftel does not encourage public confidence in the effectiveness of someone with an academic background. During the debate on Lord Ezra's amendment, my noble friend Lord Williams outlined—and I am not going to go over it all again—the sort of businesses that British gas has. It was a formidable list indeed. That is why we say and believe very sincerely that anybody who is appointed as the director should have a wide knowledge of the gas industry. Indeed, it is essential that he should have a detailed knowledge of the gas industry as well as of consumer interests.
When we discussed the Telecommunications Bill we were assured that the director of Oftel would have sufficient clout and resources to defend the interests of consumers. We now know from experience so far of the privatised telecommunications industry that the director—I do not wish to criticise him in any way on a personal basis—does not have the clout and indeed it appears that he does not have the knowledge of the industry itself to enable him to work properly, and as Parliament expected, on behalf of consumer interests. That is the experience so far. We ought to learn from experience; that is what it is all about.
Not only should members of the Opposition learn from experience, but one should have thought that the

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Government would learn from experience. I had hoped that, having seen how the director of Oftel has been underresourced and is in great difficulty in dealing with British Telecom, the Government would have wanted to do something different here. We are trying to ensure that the Government do something different by appointing someone with detailed knowledge of the gas industry and consumer affairs. That is what we want and nothing short of that will do.
The Director General of Ofgas will have fewer powers and duties than the Director General of Oftel, so far as I can see. If that is not so, it would be useful at this stage of the Bill if the noble Lord would explain to us why the director of Ofgas does not have fewer powers under this Bill than the Director General of Oftel. Noble Lords would be very interested in that and it would assist them in the later stages of the Bill. It is absolutely necessary that we have an officer who is not merely a banker or an academic used to the dreamy and leisurely environment of the university campus, but somebody who is in touch with the gas industry, knows the gas industry, knows consumer thinking, and indeed, has been at the sharp end of business. That really is most important. Gas is a business and it needs somebody who knows a lot about business to be able to act as the regulator.
The person appointed will be dealing with Sir Denis Rooke. We all know Denis Rooke. I admire the man so much. He has been a superb officer. What he has done for British Gas has been almost indescribable. I am thinking of the way he has pulled that industry round. We know that he is a tough cookie whom most if not all of us admire, even though perhaps we have had our own fingers burnt when we have crossed swords with him at some time or another. He knows the gas industry inside out, back to front and every other way.
He was brought up in the industry. He has been in the industry all his life. Here is a man to be reckoned with—make no mistake about that! In fact he will be able to run rings around any director not as tough and as experienced as he is. We are entitled to know from the Government what sort of person they intend to appoint as director. Surely that is the least that we can expect. Here we are discussing this massive and almost incomprehensible Bill and we are discussing a director. We ought to know from the Government, who have rejected any form of parliamentary control, what sort of person they intend to appoint. That at least, would give us a little reassurance. I hope that the noble Lord will give us a lead when he winds up later on.
Will the Government, for example, ensure that he or she has a wide and detailed knowledge of every aspect of the gas industry as outlined by my noble friend Lord Williams—the supply of gas, distribution, installation of equipment, safety and showrooms? Is the post to be full time or part time? We do not even know that; we have not been told. We should like to know whether this is to be a full-time or a part-time appointment. Can we be assured that the director will be expected to devote his whole time to looking after the interests of the gas consumer, or will his contract allow him to have a few jobs or directorships on the side? That is another important question which we should ask and to which we are entitled to have an answer.
What is his salary to be? We have no indication, no idea, of what his salary is to be. And that is very important. We need to know what his salary is going to be because his status vis-à-vis British Gas plc and its chairman may well be discerned by the relative salary levels of both appointments. If there is a great disparity, people will of course form their own views about the relative importance of both appointments. And in this connection it is interesting to note that in the case of British Telecom—and we are back again to British Telecom—the chairman's salary has rocketed from £67,900 in 1983, before privatisation, to £160,000 in 1986 after privatisation.
Lord Diamond: Is that a year or is it a century?
Lord Stoddart of Swindon: I am sorry to tell the noble Lord that it is a year. He gets it every single 12 months. It is £160,000 every year. I think it is taxed, but it is a 130 per cent, increase in three years.
So much for income policy. Here we have a Government and, indeed, people in industry telling workers that 6 per cent. is too much—6 per cent. a year, which is about 20 per cent. over three years. And we see that the chairman of British Telecom has had an increase of 130 per cent. in three years. On this basis Sir Denis Rooke's salary will zoom from £65,000 a year to at least £150,000 a year. Is it intended that the director of Ofgas should have a similar salary; or is he to be regarded as the poor relation of Sir Denis Rooke and treated as such by him?
As I said earlier, the salary relationship is an important one and we need to know the Government's thinking on it. Is the salary to be £35,000, £50,000, £75,000, £100,000, or what? The Government must have some idea. It will be of no use the noble Lord, Lord Belstead, saying to us tonight, "We don't know". If he says that to us, it will show either that they do not wish to give the information or that they do not know. And if they do not know, that is incompetence of the worst order. I hope that the Minister will be able to give us some idea of the salary that it is intended to pay the director-general of Ofgas.
We need answers to these questions. In our view the Government, in their mad stampede to privatise British Gas in time to finance an election bonanza, have given insufficient thought to consumer protection and have brought forward this weak, regulatory regime. They need to assure us that the director-general has not only, as I have said, to know the gas industry from back to front but also to know what the interests of the consumers are, because he has had some experience of consumers in the gas industry. I hope that the Government will give us an answer and assure us that the person who will be administering the regime does indeed have the necessary qualifications to do a first-class job on behalf of the consumers.
9.30 p.m.
Lord Belstead: Before the noble Lord, Lord Whaddon, speaks, may I just ask whether he will be speaking to Amendment No. 5?
Lord Diamond: I understand it would be for the convenience of the Committee that Amendments Nos. 4 to 5 should be discussed together. I was proposing to follow on what the noble Lord has just said—
Lord Stoddart of Swindon: I am so sorry. I should have indicated that when I spoke. I apologise to the noble Lord.
Lord Diamond: Not at all; I think we understand that. I hope it will be for the convenience of the Committee if I now rise to explain, but not to move, the amendment standing in my name and the extent to which it differs from the amendment which has already been moved.
I want to support very strongly the amendment that has already been moved for the cogent reasons that have been given. I add that this amendment is an alternative, and I want to explain why I thought when I put it down, which of course I did before I had seen the amendment in the name of the noble Lord, Lord Stoddart, that it was on the whole a good amendment. I now think it is an even better amendment than the noble Lord's, if he will forgive me saying so. I shall endeavour to explain it.
My amendment is a probing amendment, intended to find out what the Government have in mind with regard to satisfying themselves that they are going to find this giant—a giant in terms of mental capacity and of strength of character—who is to carry this fantastic weight on one pair of shoulders. What we want to know are the qualities which they think are the minimum essential to find in this one super-human individual.
We think he is bound to be super-human to be able to do the job adequately. That is why we suggested at an earlier stage that we should need at least three commissioners to combine the necessary knowledge and experience to be able to stand up to the chairman and the board of the privatised gas corporation in an attempt to protect the consumer and to ensure the maximum efficiency.
I assume—and perhaps the noble Lord the Minister will correct me immediately if I am wrong—that it would be reasonable to suppose that the board of the new privatised company would consist of at least 10 members. He cannot give me an answer as to how many there would be, because that is within the control of the new company. But having regard to the size of the board at the moment and the fact that its functions are to be no less but will indeed increase over the years, I assume it is reasonable to suppose that the individual regulator will have to match the abilities, skills, weight of opinion and character of at least a chairman and board numbering some 10 very competent individuals. The purpose of putting down this probing amendment is to find that out.
Why do I think that it is, if anything, a slightly better amendment than Amendment No. 4? It is not that there is magic in the words "full knowledge" as opposed to "detailed knowledge". It is not that there is magic in the words "adequate experience of consumer affairs" as opposed to "detailed knowledge … of
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consumer interests". Both descriptions could be construed as covering the same needs.
The reason I think it is a slightly better amendment is that the Government pointed out at an earlier stage in the other place, when this matter was being considered, that it was unwise when you were dealing with a number of qualities which were required of an individual to particularise one of them only. With respect, and having regard to a good deal of experience that one has had in legislation, I think that that is found to be good advice and a good reason for the Government's suggestion that the amendment which was moved in another place had that slight defect. Of course, it could easily have been amended had the Government wanted so to do, but it was not.
This is in order to help the Government, and in order to enable the noble Lord the Minister to get up and say "I indicated to the noble Lord, Lord Diamond, that it was not necessarily the case that we were going to brush aside every single amendment on the Marshalled List, and here is a case in which I can give way and help him suggest a modification" or whatever. I am hoping that the inclusion of the words "in particular" will cover that point.
What is being suggested is that the person to be appointed under Clause 1(1) should be an officer with either "full knowledge" or "detailed knowledge" of the gas industry "with … adequate experience of consumer affairs" or "with detailed knowledge … of consumer interests" in particular. All sorts of other qualities would be required, and those we are asking the noble Lord the Minister to describe. That is why this is regarded at this stage as a probing amendment.
Lord Sanderson of Bowden: I should like to intervene in this part of the discussion because I have a great deal of sympathy with what the noble Lord, Lord Stoddart, has said about detailed knowledge of the gas industry and of consumer affairs for this giant of a man as he has been described. However, I am somewhat worried that if we write these words into the Bill we are going to decrease the number of possible candidates for this very important job. In the whole of the discussion this afternoon and this evening we seem to be wishing to increase the number of examiners and to decrease the number of candidates. The second would be a great shame.
I feel very strongly that one phrase which was used by the noble Lord, Lord Stoddart, will be very important when the Secretary of State comes to decide what sort of man should do the job. He said that he should be someone who has been at the sharp end of business. With that phrase I totally agree, because if you are going to deal with Sir Denis Rooke or any other strong leader of an industry with vast experience the choice is very important. I do not feel that to limit the choice at this stage to somebody who has knowledge of the gas industry or of consumer affairs is necessarily fair either to the person himself who has to do the job or to the industry which he is to serve.
While agreeing with the objective of trying to get at the person who will have to do the job, I feel that to write it into the Bill could be counter-productive. I say that with some experience of industry. I know very well that it is not necessary for the best captain of industry to have been brought up in one industry. He

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may, for instance, have changed to another industry in mid-career. That has happened with very good effect. And if the Committee will forgive me for saying so, it also happens in politics. Very many Ministers who start off being good on one particular subject—be it transport, Treasury matters or whatever—end up with totally different portfolios and are very good at covering their subjects. That might even be said of the present Leader of the Opposition who has a lot to learn perhaps about commanding respect in any department that he may have to cover in the future. In conclusion, I feel that we should be very careful about being too restrictive in looking for what has been described as a giant to deal with an important job.
Lord Diamond: Before the noble Lord sits down perhaps I may say that I followed every word he said and I am grateful to him for intervening. It is obvious that he speaks with knowledge of the subject and, if I may say so with respect, he is equally right in his conclusions with regard to business as he is in his conclusions with regard to politics and Ministers. May I ask him therefore what objection he has to the form of words used in the second amendment, "in particular, a full knowledge", in which the other requirements are deliberately not excluded? What objection would he have to a form of words of that kind, which are not restrictive in any way?
Lord Sanderson of Bowden: In reply to that, it would obviously be very useful for the said gentleman to have knowledge of consumer affairs, but I know, and I think the noble Lord will know, many captains of industry—the noble Lord, Lord Stoddart, referred to people who have been at the sharp end of business—who may not have knowledge of consumer affairs. I should hate to have their names excluded from any possible list. You will probably find after a very short time that somebody of that calibre would pick up the whole ethos of consumer affairs, which is a very important part of the job.
Lord Whaddon: These suggested amendments are necessary. They stress again the vital importance of this appointment. As I mentioned earlier, the industry will be operating in a completely new universe where the importance of achieving profitable sales is the criterion on which a man's performance, his future career and his pay will be decided. Whoever is to be the director must be well versed in the techniques of salesmanship and of gaining profits, as well as the techniques that verge on trickery which are sometimes used to maximise profit.
I take, for example, what has happened in regard to many foreign cars which started some years ago to come into the country cheaply. People were startled by how cheap some of these foreign cars were. They bought them because they were cheap, not realising that the profit of the foreign companies would be earned in later years on the sky-high costs of spares. This is drummed into salesmen. They will often sell a product cheaply and make the profit on its adjuncts. Once a housewife is hooked on a particular appliance—and sales are usually made to housewives—that appliance can rapidly be made redundant.
9.45 p.m.
I had a beautiful example of that with British Telecom recently. I have been under pressure for a long time to buy one of the new super telex machines. I have seen advertisement after advertisement, and I have had sales rep after sales rep onto me about the wonders of those new machines. I was perfectly satisfied with the machine which I had had for several years and which performed beautifully, and I wanted to keep using it.
However, out of the blue there suddenly arrived a notice to say that from immediate effect maintenance on the old machine would cease and would no longer be provided. Against my will and against my interests, I shall be obliged to buy a new machine. That is the kind of technique used to maximise the profitability of companies that previously worked as nationalised industries and as a public service. In future, they will be working to maximise their profits, and the director general must know that world.
Sales techniques involve, for example, the setting out of shelving in stores. Any parent knows that when one goes into a supermarket, one has to walk to the back of the store to reach the cheaper, everyday articles. To reach the items that one must have, one has to pull one's children past shelf after shelf of goods that they see and cannot avoid grabbing and putting into the basket.
Parents are almost forced to pay for items that they do not want. That is a standard sales technique. One sells not the goods themselves but mother love and father love. The television advertisement makes mention of:
"Hands that wash dishes can be soft as your face".
It is not the product's cleaning ability that is sold so much as mother love. There are deep forces in parents that are played upon, and those psychological pressures are the everyday means by which salesmen manipulate the public.
The same pressures will be used without question by the gas industry upon its becoming a private monopoly. Whoever is appointed to the position of director-general for consumer affairs must be aware not only of the technology of producing gas but also of the techniques of selling and of manipulating the market.
I shall mention one further technique, which concerns patents. We shall have a gigantic gas industry that will certainly put a lot of effort into developing new consumer goods and devices that use gas. Those devices will be patented as they are developed. By patenting those products, their inventors will produce a restrictive market that keeps competition out, and thus they will maximise their profits.
It may be argued, quite legitimately, that firms that put effort and expense into research are entitled to a decent profit, but there is more to it than that. Firms will continue their research, and if they find that there is a product due to come out of patent in five years' time and they have already developed the next generation of that product, they will not market the newer generation immediately. They will wait until the previous product is just about to come out of patent before marketing the product that is the subject

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of the new patent. They will thus extend the life of their research and production and they will maximise their profits.
Those are all legitimate techniques which are drummed into salesmen and which salesmen are taught on the courses they take. I do not blame them, for that is their job. However, it is imperative that the director general should be fully educated in those
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techniques before he is appointed. All the more reason why we were so anxious that he or she should be subjected to a thorough analysis before appointment.
I believe that both these amendments have merit. Personally, I prefer Amendment No. 5, but I should be most interested to hear what the Minister has to say. I hope he will show that he has absorbed the importance of the case that we have been making.
Lord Belstead: I fully accept the importance of the two characteristics which noble Lords have identified in Amendments Nos. 4 and 5. However, like my noble friend Lord Sanderson I would be against making special mention of these two particular qualities in the Bill, for the reasons which my noble friend gave, even though it is the case that the noble Lord, Lord Diamond, has so worded his amendment that it would only be "in particular" that the characteristic of expertise in consumer affairs should be taken into account.
Several noble Lords—the noble Lord, Lord Stoddart, in particular—asked what are the characteristics that the Government would be looking for in the director general of Ofgas. I direct your Lordships' attention to Annex A to Clause 1 in the Notes on Clauses, where there is a long list of the 21 different functions which the director general, when he is appointed, will be called upon to fulfil when the Bill becomes law. Therefore, there are important qualities which he will need in order to fulfil those 21 functions. These will include the ability to make effective judgments on the basis of assessments of all the relevant factors in a particular case, be they technical, legal, economic or otherwise.
On the previous amendment, Amendment No. 3, the noble Lord, Lord Whaddon, was really suggesting that the director will need to be a man, or a woman, who has a very wide range of qualities and expertise. In addition, of course, the director will, through the expert advice of his staff who will be working closely with the industry, consumer organisations and other bodies, be mastering his brief. He will need various skills if he is going to be an effective protection for the interests of consumers. He will, of course, have to manage his office effectively and ensure that all the tasks assigned to him by the Bill are properly carried out.
I conclude that although knowledge of the gas industry is going to be a very useful attribute to the director, I do not think it ought to be singled out and given statutory preference. On behalf of the Government, I feel the same about knowledge of consumer affairs. It is enormously important, of course, and recognised to be so, because in Clause 4 we have placed a specific duty on the director, as well as on my right honourable friend, to protect the interests of gas consumers. We are also providing for a separate body, the Gas Consumers' Council, whose whole purpose will be to protect consumers' interests. I hope that when we come to those clauses your Lordships will agree that we are making extensive provision in the Bill for the general protection of consumer interests in relation to the responsibilities charged on the director and the Gas Consumers' Council.
Lord Diamond: May I interrupt the noble Lord and ask him to clear up a point which is very relevant to what he has said but which is beyond my knowledge? He referred to an annex which I do not have with me—although that is my fault, I know. I take it he is not referring to a schedule, but to an annex. I ask him, therefore, what is the status of that annex? Is it to be attached to the Bill? Is it to be used for guidance? Is it
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to be published, or is it to be kept confidential? If it is to be published, I cannot follow the argument that it should not be put in the Bill but should only be put on a piece of paper, called an annex, which is published and which is, therefore, just as restrictive—in the terms that the noble Lord, Lord Sanderson, is anxious about, and I understand his point—as if it were in the statute itself. Therefore, can the noble Lord assist us on the status of this annex?
Lord Belstead: I apologise to the noble Lord for not making myself clear. I was simply referring to an annex called Annex A to the Notes on Clauses which has been put in the Printed Paper Office for any noble Lords who are interested, and to the note for Clause 1. That shows that there are broadly 21 different areas where it can be said that the director has functions if one looks through the Bill. Perhaps it would be helpful to the noble Lord if I briefly identify one or two of those functions.
For instance, in order to protect the interests of consumers, there are strong and effective powers for enforcement of obligations under Clauses 28 to 30, and that enforcement falls to the director. The director will have the ability to propose modifications to authorisations under Clauses 23 to 27 if circumstances concerning the control of the tariff market change and new provisions are necessary. The director will have the duty to investigate complaints under Clause 31 and other duties and powers such as advising consumers and powers to get information under Clauses 34 to 39. I have just mentioned a few of the functions of the director which I think, taken together, show that he will exercise strong and effective control over the industry and ensure that under privatisation the consumer will have a better deal.
Perhaps I may end by saying that I was interested that the noble Lord, Lord Diamond, with his great experience of the parliamentary process, said that he felt that picking out a particular characteristic or characteristics was undesirable. I had always understood that it was undesirable because it could suggest that other qualities were not worthy of mention and could be held to limit the qualifications which in this case the Secretary of State ought to take into account in choosing the director.
For that reason I say on behalf of the Government that I do not like Amendment No. 4. I have to say that, though the noble Lord, Lord Diamond, with his accustomed skill, has worded Amendment No. 5 rather differently, it also suffers from the same defect. It would mean that one characteristic, and only one, would be put more prominently than any other when it comes to the point of choosing the new director. I should have thought that that was something which the Committee would not wish to support.
Baroness Seear: The noble Lord has asked us to believe that this paragon will exercise strong control over the industry. As I listen to this debate I become more and more pessimistic and feel that this device for protecting consumers is eyewash. I simply cannot believe it. Like most of the members of this Committee taking part in the debate, I know and

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greatly respect Sir Denis Rooke. As I sit here, I am picturing the unfortunate fellow who, it is said, does not even need to know the gas industry, surrounded by advisers whom he has picked and who are probably being paid at a rate somewhere in the middle grades of the Civil Service, taking on Sir Denis Rooke and the very able directors he will have with him and arguing with them about what is going on in the gas industry. If the noble Lord expects us to believe that this is giving the consumer protection, he can expect us to believe absolutely anything. I am deeply depressed by the whole proceedings.
Further, what is this fellow to be paid! If he is any good he will be in the international market for an international industry. I spent several years on the Top Salaries Review Body and I know perfectly well that there are jobs which must be filled—and this will be one of them—but where there are only a small number of people who have even a hope of doing the job properly. These people are almost beyond price in the international market and there is not a hope in hell of getting them. This proposal is a farce in terms of consumer protection.
Lord Belstead: I would just ask the noble Baroness whether she has taken the trouble to read Annex A to the Notes on Clauses to Clause 1 or whether the noble Baroness, for whom I normally have a great admiration, took the trouble to listen to what I said in reply to the noble Lord.
10 p.m.
Baroness Seear: I listened very carefully. It was what the noble Lord, Lord Belstead, said that finally got me to my feet.
Lord Belstead: Very well. Which of the characteristics that I gave in answer to the noble Lord does the noble Baroness think is eyewash?
Baroness Seear: I think that the whole proposal is eyewash. That is the point I am making. We are being asked to discuss the details of a proposal that, as a proposal, is useless, in my view.
Lord Belstead: The trouble is that we are being asked to discuss an amendment ahead of discussing a great deal of the detail of what the director does. That is not the fault of the Government. It is the fault of the amendment that the noble Baroness is supporting.
Lord Stoddart of Swindon: Before the noble Lord sits down, earlier I asked him a number of questions. May I repeat them? I asked if the director was to be full or part-time. I do not think that we have had an answer. Will he be expected to devote the whole of his time to looking after the interests of gas consumers, or will his contract allow him to have directorships or jobs other than the directorship of Ofgas? I asked whether the noble Lord could give some indication of the salary that the Government had in mind for the director. I also asked the noble Lord to explain why he
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believed, if he does so believe, that the regulatory regime set out in the Bill is as strong as the one set out for the telecommunications industry. We need to know the answers.
Lord Belstead: I do not in the least mind being asked but, with great respect, the noble Lord would be the first to criticise the Government if we had made up our minds about the terms and conditions of employment for the director before the Bill had even started going through your Lordships' House. The fact is that no appointment has yet been made, and therefore the answers to the questions do not exist. What does exist is the fact that my right honourable friend is of course considering very seriously all the points that the noble Lord has put forward. It is for that reason that I do not in the least mind being asked the questions. It is absolutely right that we should go over this ground in debate. I repeat, however, that if I was able to stand up and say that conclusions had been reached on all those questions, I really believe that the noble Lord would say to me that the Government were treating the Committee with disrespect when the Bill had only just begun going through your Lordships' House.
Lord Stoddart of Swindon: I understand that. But, unfortunately, I have been a little confused. I understand that the chairman of the new gas consultative council has already been named. That is the first thing in advance of the Bill going through. I also believe that some advertisements appeared in the Guardian yesterday for staff. If so, it seems that the Government have made certain decisions—about the gas consultative council, anyway. One of the reasons that I asked the question was that I thought that the Government would have made up their minds and that they would indeed have been able to give us information. What is going on?
Lord Bruce of Donington: The noble Lord was kind enough to refer to Annex A in the hope that it would give us some enlightenment as to the Government's thinking about the qualifications required by the director general. All that Annex A is, in fact, is a sift through the various clauses summarising in respect of each relevant clause where the director general has something to do. For example, there is the collection of information under Clause 34. It does not require a genius to collect information. The rest is very much on the same fines. The noble Lord tried, I believe, to confuse us, albeit unintentionally, by referring us to Annex A as being a schedule of qualifications when it amounts only to a summary of the functions under various parts of the Bill. The noble Lord may reply that he has to have certain qualifications to carry out these functions. That is legitimate. I am bound to say that I think the noble Baroness, Lady Seear, encapsulated the whole business by saying that this is a lot of eyewash. Of course it is; but it has to be.
The noble Lord has two tasks to fulfil. He is trying to fulfil them both at once, and it is most difficult. The first is to convince the Stock Exchange and the institutions that the limitations put on the new free enterprise concern will be cut to the minimum, because the more ineffective the director general will be the better it is for

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the profits of the industry. Indeed, the noble Lord has read the newspapers as much as anybody else. He knows that when the Bill was published, even in the Financial Times, which is not normally a paper bought in the Walworth Road, they were discussing quite openly that his Minister would have to be very careful not to restrict the industry too much by laying down too rigid terms; Otherwise investors might be scared off. That becomes a relevant consideration now, in view of the fact that they will have the additional anxiety of the decline in the price of fuel generally following the decline in the price of oil.
I can see that the noble Lord has the task of convincing the City, on the one hand, that the control will be innocuous and will therefore not affect profitability; and, on the other hand, he has the duty to the country and Parliament to persuade them that it is an iron regime which will be enforced with great skill in the interests of the consumer. This is the art of the Conservative Party. We are familiar with it. Indeed, I should like to congratulate the noble Lord, Lord Belstead, in particular, because I thought he attempted this part of the task very skillfully.
However, had the noble Lord been wise he would have conceded the amendments which were moved earlier. Those amendments tried to give the Secretary of State's relationship with the director general some credibility. He would have been wise to have done that. It might have affected the issue price of the shares and therefore the money coming into the Chancellor. But those who try this kind of financial gain have to expect that. However, he did not do that and I think it was a great mistake.
The trouble, which has been implicit in the amendments that have been put forward and in the long discussions that have taken place upon them—because we are aware of this duplicity, this double-dealing, on the one hand, to satisfy the Stock Exchange, and, on the other hand, to pretend to try to satisfy the Chamber—is the reason that the discussion has taken so long. This is the reason why, quite correctly, the amendments have been pressed to a Division.
Lord Williams of Elvel: I just want to join with my noble friend Lord Bruce of Donington briefly and repeat something that I said in an earlier intervention this afternoon. I believe that I am the only Member of the Committee who has run a regulatory authority and who has had the opportunity to have the sort of discussion that I think a future director will have with the chairman of British Gas.
I can assure the noble Lord, Lord Belstead, that the noble Baroness, Lady Seear, is absolutely right. Unless you have somebody (I should prefer a commission) and you describe that somebody who has the authority, the status and the international reputation to stand up to Sir Denis Rooke, or whoever is the chairman of the successor company, I am afraid that you are on to a loser. And if you are on to a loser in this particular field it will hang around your neck for the rest of the life of this Bill. I hope very much that the noble Lord will bear this in mind. I speak from very deep personal experience on this.
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I hope that the noble Lord will consider these amendments and make some concessions to us on this. It is eyewash, but it is very dangerous eyewash. It is something that I personally feel very strongly about. It is dangerous because if we are stuck with this then we are stuck with it for ever.
Lord Swinfen: Noble Lords opposite are trying to suggest that you get the best man for the job, but they are limiting it in these two amendments to a man designed for today. They are leaving absolutely no scope for a man to be chosen in a few years' time to deal with the needs of that time, which are not necessarily the needs of today. Needs change. The man who leads that industry may need to be a different type of man, with different types of skill.
Quite obviously, he must be a captain of industry. That means a leader of men, who will be able to get the best out of those who serve under him. He needs to do what is required at the time: to use the skills of others to get the gas industry moving in the right direction today; or he needs to go in a different direction in six years' time if that is what is necessary.
It is absolutely hopeless today having a man who is capable of designing and selling the Austin 7 when we have the Range Rover on the road. The market is totally different. The world is different today. The world will also change with gas, and it would be wrong to tie the hands of those who have to appoint the leaders of that industry, no matter which party they come from. Those opposite, if by any mischance they come to power in the future, may very well regret their actions if either of these amendments goes through.
Baroness Gardner of Parkes: Having listened to all the comments on Denis Rooke, it appears that some people in this Chamber seem to think there is no other man in the whole of the United Kingdom equal to him. After all, why a man? Why not a woman? I have the highest regard for Denis Rooke, as I think we all have, but to listen to this debate it sounds as if he were a most terrifying and impossible giant to deal with. That is throwing quite a false image before the House. There will be plenty of people capable of taking this job.
I have a certain sympathy with the amendment in that I think it is desirable to have someone who has experience in the gas industry, but I also appreciate the point that by tying in those exact words we may be ruling out someone who does not have the experience but who is 10 times better and more capable than the person who has. For that reason, I cannot support the amendment.
Lord Stoddart of Swindon: I have listened closely to the debate. I say first of all to the noble Baroness, Lady Gardner of Parkes, that we do not think that Sir Denis Rooke is a god, but he is a highly competent operator and a very competent person. We want to ensure that there is somebody just as competent who is regulating the business of which Sir Denis is chairman. We are not saying that there is nobody like Sir Denis Rooke. What we are saying is that there are people like Sir Denis Rooke, and we want to be assured someone like that is appointed as director of Ofgas. I hope I have made that point clear, because it is important that we

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get such a man. The noble Baroness knows Sir Denis Rooke as well as I do, and he is highly competent.
The noble Lord, Lord Swinfen, said that we needed a leader of men and that we needed to adjust to change. That is true. We need people who are leaders. The problem is that technical change is such that, if you do not have somebody with the basic knowledge of the technology, it is difficult for him to know what the changes are and whether they are beneficial or otherwise. Therefore, that is why we believe that he should have some qualifications. However, I must say that I listened particularly carefully to the noble Lord, Lord Sanderson of Bowden, and I was very impressed with what he had to say. I think that we should read what he said.
10.15 p.m.
I do not want to be painted with the same brush as the Government of not wanting to listen to what other people say. I should also like to give the noble Lord, Lord Belstead, the opportunity to reflect on the questions I asked him but which he was unfortunately unable or unwilling to answer—I do not know which. I should like to give the noble Lord the opportunity to give the Committee that information. Under those circumstances, in the light of the admirable speech by the noble Lord, Lord Sanderson of Bowden, and the fact that we really do not have the information, being reasonable I think that I shall withdraw my amendment. However, I may very well bring it back at some later stage. As I say, I shall withdraw my amendment, but if the noble Lord, Lord Diamond, intends to press his amendment, that raises a different issue as a matter of fact, a specific issue, and as he said it is a probing amendment. If the noble Lord presses that amendment to a Division, I think we would join him. I beg leave to withdraw Amendment No. 4.
Amendment, by leave, withdrawn.
Lord Diamond Lord Diamond moved Amendment No. 5:
Page 1, line 8, after ("officer") insert ("with, in particular, a full knowledge and adequate experience of consumer affairs")
The noble Lord said: I beg to move Amendment No. 5. I hope that your Lordships' Committee will permit me to say a few words about it because I deliberately avoided saying anything on it in response to the noble Lord, Lord Belstead, when he made a number of comments referring to it and to the arguments which I put forward.
I should like to deal, first, with the comments made by the noble Baroness, Lady Gardner of Parkes, and to thank her for the interest that she has shown in the debate and for her attention and attendance. We would of course want to meet her point of view in every possible way. The noble Baroness has misunderstood this point, and it is entirely my fault; or perhaps she was not here earlier when I made this point very fully. We are not claiming that you cannot have an individual who could stand up to Sir Denis Rooke. I have not had the pleasure of meeting the gentleman, and I accept that he is a very capable, powerful and effective businessman. We are saying: how on earth can one person cope with what Sir Denis Rooke has at his command? What he has at his command is, first, a board—a group of 10 or so individuals of enormous competence. That is why we want at least a commission—a small group—which
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will be able to stand up to that. Sir Denis Rooke has at his command a huge staff and investigators. We think that it is beyond the capacity of any single human being to have such qualities—
Baroness Gardner of Parkes: I thank the noble Lord for giving way. I appreciate the points that he is making. I consider that the points which he made very clearly and at some length earlier were relevant to Amendment No. 1, but they are not relevant to Amendment No. 5. As I read Amendment No. 5 I do not consider that it suggests a panel of people. Amendment No. 5 is really covering the special qualifications of one particular person. Therefore, I think his comments at this moment are not precisely relevant to this particular point.
I hold Sir Denis Rooke in the highest regard, but, as I said, I believe that there are other people in this country who could fill this post perfectly well. It think that if a number of people were under consideration and one had experience in the energy field, the gas field or the appropriate technology, that in itself would be almost a recommendation and an additional qualification and it would probably mean that that person was chosen for the post. But to say that a person must have a particular qualification changes the situation in that it rules out people who may have other parallel and suitable qualifications but who do not precisely match the very words set out here. It is for that reason that I oppose this amendment as I opposed the previous amendment.
Lord Diamond: I understand the point that the noble Baroness is making. We are on the same point. We would have preferred a commission of at least three commissioners. They might have been able to do the job. We might then not have had need of any of these amendments we are considering. But as we are now considering one individual we do not hesitate to say that that one individual shall have in particular one qualification.
I entirely accept what the noble Lord, Lord Belstead, said about the better way of legislating. But that point is met entirely in my view by the wording of the amendment, which says:
"in particular, a full knowledge and adequate experience of consumer affairs".
That does not rule out any other qualification at all.
I now withdraw the importance I attached to Lord Belstead's comments on the annex in which he was merely saying to me, "As I do not know the answer to the question as to who were the Prophets of Israel, I hereby give you a list of the Kings of Israel." We are not considering functions and duties; we are considering qualifications, as has already been pointed out. The qualifications are such that one of them, in our view, should be that which is proposed in the amendment.
In the view of some noble Lords or noble Baronesses—this is the great danger, and it proves the point I am making—it is not necessary to have an individual who at the time of his appointment has adequate experience of consumer affairs. I do not accept that. What I am saying is that this arrangement will not succeed if it is not seen by everybody at the start that the person appointed is likely to be able to

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look after the consumers' interests. That is the first requirement. You will get nowhere with this Bill, with the protection that is is claimed this Bill provides, unless you have an individual who is seen to be likely to succeed by virtue of his having,
"a full knowledge and adequate experience of consumer affairs".
Of course he may be able to pick this up in the course of two or three years. But he may make all sorts of mistakes in the course of two or three years and land the Secretary of State and the Government in considerable trouble as a result, as is happening with regard to Oftel. That is why this particular qualification should be possessed by the candidate who wishes to take on the job.
It is for that reason that I think my noble friend Lady Seear was right in saying not what the noble Lord, Lord Belstead, imputed to her, but what in fact she said—that this whole arrangement (not this particular amendment) is nonsense. It will not work. You are trying to find somebody with qualities which are beyond contemplation as being in the hands and brains of a single individual. That is not in the amendment before us. Because we could not get what we wanted, the amendment before us is the next best thing, that the population and consumers as a whole should see that the Government have gone out of their way to make sure of one thing at least: that the person in question shall have adequate experience of consumer affairs.
Although it is so late—I apologise for this—I cannot withdraw the amendment, which seems to me sensible in every way. It meets the arguments that have been put forward, it meets the anxieties expressed on the other side of the Committee and provides for the one drafting difficulty that has been mentioned.
10.26 p.m.
On Question, Whether the said amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 14: Not-Contents, 21.

DIVISION NO. 3

CONTENTS

Bruce of Donington, L.

Pitt of Hampstead, L.

Dean of Beswick, L.

Ponsonby of Shulbrede, L.

Diamond, L.

Seear, B.

Gallacher, L.

Stoddart of Swindon, L.

Hanworth, V.

Whaddon, L. [Teller.]

Harris of Greenwich, L. [Teller.]

White, B.

Williams of Elvel, L.

McNair, L.

NOT-CONTENTS

Belstead, L.

Long, V. [Teller.]

Brabazon of Tara, L.

Macleod of Borve, B.

Caithness, E.

Maude of Stratford-upon-Avon, L.

Cork and Orrery, E.

Craigmyle, L.

Mountevans, L.

Elliott of Morpeth, L.

Reay, L.

Gardner of Parkes, B.

Saltoun of Abernethy, Ly.

Gray of Contin, L.

Sanderson of Bowden, L.

Harvington, L.

Skelmersdale, L. [Teller.]

Henley, L.

Swinfen, L.

Lindsey and Abingdon, E.

Trumpington, B.

Resolved in the negative, and amendment disagreed to accordingly.
10.34 p.m.
Lord Ponsonby of Shulbrede: Before the next amendment is called, I think that I should point out to the Government that it is the Government's responsibility to maintain a quorum in the Committee. If it had not been for the co-operation of the Opposition, there would have been no quorum at this time. I give notice that if there is another Division called this evening, we may not be able to co-operate on a second occasion.
Lord Diamond Lord Diamond moved Amendment No. 6:
Page 1, line 11, at end insert—
("( ) The Director shall, after consultation with the Secretary of State and with the appropriate Committee of each House of Parliament, appoint an Assistant Director with special responsibilities for Scotland, and an Assistant Director with special responsibilities for Wales.").
The noble Lord said: I beg to move Amendment No. 6.
I cannot imagine that the Committee will not regard this amendment with considerable sympathy and treat it as a very important amendment. We have so far been unable to persuade the Government that there should be a commission rather than a single individual, and that the commission as earlier put forward might, if it had had three members, in addition to the responsibilities described in that earlier amendment, have found it convenient to have one of those commissioners looking after Scottish affairs in particular and one looking after Welsh affairs in particular.
Certainly there can be no doubt whatever, whether or not you say it in the Bill, that the needs of Scotland and the needs of Wales are separate needs which have to be considered, and there is no doubt whatever that, in political terms, any Government which have no regard to these special needs and do not show that they are catering for these special needs are running into serious trouble and being very unwise in doing so. I hope, therefore, that on the first point I shall have the sympathy of the Government and of the noble Lord the Minister.
I have suggested that there should be consultation, of course, with the Secretary of State. Of course the Secretary of State is responsible to Parliament, and of course he holds high office and has a great deal to bring to the decision-making process with regard to the director and assistant directors. Therefore, he at least should be consulted. Then there should be consulted the appropriate committee of each House of Parliament.
As your Lordships know, I would prefer consultation with a Select Committee of the House of Lords. For the reasons I have given I think it would be a more manageable process, and one which was very suitable to the present activities and to the growing stature of your Lordships' Chamber. But that has not been accepted, and so I have kept it to the appropriate committee of each House of Parliament. I hope that consultation will be agreed as well.
The major point of the amendment, of course, is the regional aspect. I hope I can speak very shortly on that at this stage, because surely any Government would be persuaded of that and I am only pointing to the obvious. If I find I cannot persuade the Government

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with the few words I have said, then I shall have to come back to it at a later stage. I am keeping it very short, and I beg to move.
Lord Elliott of Morpeth: I find myself in some difficulty in agreeing with this amendment. I come from the North-East of England, where in regional terms there has been an almost constant dialogue and discussion with successive governments on the comparison between the English regions and the countries of Scotland and Wales. The population of Scotland at this time, if I remember rightly, is something like 5 million. The population of England is 50 million. If we are to have a special assistant director for Scotland and another for Wales, what about another ten for the various English regions? This seems to me to be an unfair and unreasonable suggestion. Once again, if I may, I will suggest to your Lordships that in terms of the regions of England it is a wholly unfair suggestion. I therefore wish to oppose this amendment.
Lord Gallacher: On behalf of these Opposition Benches, may I say that we are sympathetic to the amendment which the noble Lord, Lord Diamond, has moved. Our sympathy is based on a number of considerations which I hope the Minister will take into account when he comes to reply.
We are genuinely concerned about the likely impact of privatisation on regional structures for British Gas as such. There is a feeling that the new management may decide that regions, which have always existed since nationalisation, are superfluous and that in the interests of economy and in the interests of concentrating the whole of the decision-making process with British Gas, the regional structure may disappear. That to us would be regrettable, because in the mind and in the view of the public British Gas does not exist but the regional structures do—Segas, Norwest, Northern Gas and the like. We are in favour of the retention of the regions, and subsequent amendments will attempt to convince the Committee that that is a desirable end in itself.
We are particularly in favour of regional structures for Scotland and Wales, and in response to the noble Lord who last spoke I should like to say that he should not consider this matter in terms of arithmetic or anything else, but rather he should look at the bright side, which is that if there are separate assistant directors for Scotland and Wales, the remaining chief directors will be able to devote more of his time and energy to looking after the regions in England.
The noble Lord, Lord Gray of Contin, will be well aware as a home Scot, and will not need reminding by an Anglo-Scot, that Scotland has its own law relating to land tenure, to planning and, above all, to commerce. Indeed, as students we spend a great deal of our time concentrating on the differences between Scottish and English commercial law. That is a very important consideration in defending consumer interests, which is the primary task of the director of Ofgas. Similarly, by accident or design, Scotland is totally separate in the matter of electricity. It has nothing to do with the Central Electricity Generating Board and has two entirely separate boards. If we were
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privatising electricity instead of gas, the Government would presumably have a dilemma as to what to do about Scotland because of the existence of those boards.
Furthermore, the Government inherited in 1979 from the outgoing Labour administration some very effective machinery for the protection of consumers. I refer to the National Consumer Council, which the Government quite rightly continue to fund to the extent of just over £1¼ million a year. But the Minister again will not need reminding that, as well as the National Consumer Council, as part and parcel of that machinery there are separate councils for Wales and also for Scotland. I submit to the Committee that that recognition and that acceptance by government indicate that there is a case for the amendment standing in the name of the noble Lord, Lord Diamond.
Furthermore, both Wales and Scotland are countries. They enjoy a considerable measure of devolution—in the opinion of many Scots, not enough—and I think that this proposition would encourage Scotland to feel that its interests were going to be looked after; and the same consideration would apply in Wales. Therefore, on all these grounds I hope that the Committee will accept the amendment and, if the Minister cannot accept it, I hope that he will at least make a sympathetic response to it.
Baroness Gardner of Parkes: I am slightly puzzled by this amendment. Is this yet another proposal to have three people instead of one? Is it really a similar type of amendment returning through the back door? I support very strongly the view put forward by my noble friend who said that this amendment would definitely discriminate against England, because at the moment there are many regions in England and Scotland is just one region. To compare this with electricity board structures or with electricity supply structures would be quite wrong, because the way in which the electricity industry is operated throughout the United Kingdom is quite different from the means used for the gas system. I cannot support this amendment as it stands, and I ask the Committee to reject it.
10.45 p.m.
Lord Whaddon: I very shortly beg from the Minister a small point of information. Years ago I remember introducing a Private Member's Bill in another place. I was taken completely by surprise by a question from the Floor as to how my Bill applied to Northern Ireland. I suddenly realised that for all my study of the subject I did not have a clue as to how Northern Ireland fitted in. The position of Northern Ireland is relevant to this amendment. I suddenly realised that I did not have a clue how gas is at present supplied in Northern Ireland or what would be the position after privatisation. In connection with this amendment, I should be most grateful if the noble Lord can clarify the position for the Committee.
Lord Gray of Contin: Perhaps I can deal with that last point first. The Bill does not apply to Northern Ireland.

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The party opposite, and now the Social Democratic Party, have made known their views on the extent to which a regional structure for the gas industry should be provided for in the Bill. This again was discussed at considerable length in another place, and so we are not in any doubt about where the parties' views lie on this matter. I reiterate that our purpose in setting up the new regulatory regime is to avoid inflexible requirements of the type in the present legislation. To cast in stone a requirement for regional directors would make change impossible if such an arrangement proved to be counter-productive.
I was particularly interested to hear what my noble friends Lady Gardner and Lord Elliott had to say on this subject. I reiterate that the director is given a number of duties and functions in the Bill which he must fulfil properly. If in the light of experience he considers that it is most effective to give his staff responsibility for a particular area he will be able to do so. But to place a duty upon him to this effect would run counter to the whole philosophy of our approach, which seeks to provide for flexibility in pursuit of maximum efficiency and minimum alternative waste.
At this late hour I do not propose to say very much more. I merely point out to the noble Lord, Lord Diamond, and to the noble Lord, Lord Gallacher, who spoke on behalf of the Official Opposition and with whom I find it difficult to take issue, being a good countryman, that on this occasion I cannot be persuaded by their arguments. I am afraid that I cannot accept the amendment.
Lord Harris of Greenwich: I wonder when we are to hear a Government spokesman on this Bill say that he has been persuaded by any argument, ever. We had this on the Telecommunications Bill. There was total resistance. We are having the same again, except that the Committee is now sitting only because the Opposition were good enough to supply the Government with a quorum on the last debate. It is a most extraordinary situation that on the major privatisation measure in Parliament the Government cannot keep their supporters in the Committee to support them in the Division Lobby and provide them with a quorum.
At the same time, there is not the slightest indication that they are prepared to make any concession whatever. When noble Lords opposite complain, as they have been, that we are not making a great deal of progress, they might ask themselves this question. What contribution have they made to the progress of this Bill? If they were prepared to give any indication at all that they would listen seriously to the points raised on the Opposition Benches, I suspect that we should be making a great deal more progress. But in the meantime, if they are going to be so inflexible, I suggest that they persuade their supporters to remain in the Committee.
Lord Diamond: I am very disappointed with the answer of the noble Lord the Minister. It was short in length and short in content; very short indeed. I understand the first; I do not understand the second. I do not understand why the noble Lord does not feel that he has to justify resisting the fifth amendment running; five out of five. According to my arithmetic,
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that is approximately 100 per cent. I fail to understand why the noble Lord feels compelled to resist on every single amendment and why, though a good Scot himself, he is not able to say that there is something to be said for having representation of the Scottish point of view, with special responsibilities for Scotland and special responsibilities for Wales. I am totally astonished about that.
A number of noble Lords have been good enough to make a contribution to this debate. However, they have not persuaded me that when one is providing for special representation for certain sections and not for other sections, as they put it, the right answer is to provide special representation for nobody. I am sorry, but I cannot accept that as a valid argument.
If the noble Lord, Lord Elliott, were to say that there is a good, solid argument for dealing not only with the national representation problem but also with the regional representation problem within England, for example, of course I would agree with him. That is perfectly all right, and we would have no difficulty about it on these Benches. That is part of established, written public policy.
I start merely by making the most modest amendment, as we have done throughout, and hoping that the Government will agree with us step by step. The same remark applies to the noble Baroness, Lady Gardner of Parkes. She takes the view that we ought not to differentiate between regions within England and those within Wales and Scotland having their own separate representation. We accept that perfectly well. The way to deal with that point, if I may say so, is to expand the amendment—as we can easily do at a later stage—and say that there should be appointed an assistant director with special responsibilities for Scotland, an assistant director with special responsibilities for Wales, and an assistant director with special responsibilities for each of the present regions, as the gas board has them, within England. Presumably that would satisfy the real wishes of the noble Baroness and of the noble Lord, Lord Elliott. I hope that I have understood what they have indicated.
There is one further point that I must make. The noble Lord, Lord Elliott, understands as well as do the rest of us that there is a distinction between regions and nations. The noble Lord knows as well as I do, because it is not far for him to go from his old constituency over the Border, that the Scots regard themselves as a separate nation. Anybody who tries to do business in Glasgow and takes no note of that situation is heading for a fall straight away. We know that that aspect must be taken into account, and the same kind of remark applies to Wales.
I am bound to say that I cannot understand why the Government will not move even on this amendment. I repeat that a 100 per cent. refusal is getting a little boring. We wonder why we are providing a Committee for the convenience of the Government. We are providing a Committee for the convenience of the Government—
Lord Brabazon of Tara: No!
Lord Diamond: I do not know why the noble Lord says "no". Would he like to explain that? No, he would not. We are providing a Committee because we

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did not take the opportunity that was available to us, and which we considered, of not providing one. It is as simple as that. We considered it and decided that we would provide a quorum. We made sure that we would all vote so as to enable a quorum to be shown to exist. That is the answer. I am absolutely right in saying that we provide a Committee for the convenience of the Government under the mistaken assumption that the Government want to make progress with this Bill. Yet in spite of that, with each amendment that we have put forward we have been denied the opportunity of having even a meaningful debate about it. The arguments have been merely brushed aside.
We shall do what it is open to the Opposition to do, when we come to a later stage of the Bill, by tabling amendments and forcing them as far as we can. I understand that we cannot go all that far. I understand that the Government do not have to rely on arguments but merely on the forces which they can summon; except of course this evening when they failed to do so, but with notice they will no doubt do that on other occasions.
We should have thought that the Government could give us some helpful indication on an amendment of this nature. I feel that I should ask the Minister whether he is not prepared, even now, to say that he is willing to reconsider this amendment in the light of what has been said from behind him, too, about the desire for the responsibilities due to the different regions in England being taken into account as well as the responsibilities for Scotland and Wales, and say something which is more helpful to us.
If the noble Lord is not prepared to do so, I am placed in the difficult position of either bringing business to a close by so arranging the vote or withdrawing the amendment. I can only take the responsible line on this occasion and seek leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Viscount Long: As we are sitting at eleven o'clock tomorrow morning, I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at three minutes before eleven o'clock.

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