Sitting of 10 February 1986

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

  FELIXSTOWE DOCK AND RAILWAY BILL
  Motion made, and Question proposed,
  That leave be given to the Committee on the Felixstowe Dock and Railway Bill to sit with two Members on and after Tuesday 11th February.—[The First Deputy Chairman of Ways and Means.]
  Hon. Members: Object.

  PETERHEAD HARBOURS (SOUTH BAY DEVELOPMENT) ORDER CONFIRMATION BILL (By Order)
  Order for consideration read.
  To be considered upon Wednesday 12 February at Seven o'clock.

Oral Answers to Questions
  WALES

    Labour Statistics (Ogmore)
    Mr. Powellasked the Secretary of State for Wales how many persons, male and female, are unemployed in Ogmore; how many are long-term unemployed and under 21 years of age; and how the figure compares to the other areas of Wales.
    The Secretary of State for Wales (Mr. Nicholas Edwards): On 9 January 1986 there were 4,084 male and 1,238 female claimants unemployed in the Ogmore constituency. Data on age of claimants and duration of unemployment are available only until October 1985, when there were 158 males and 78 females under 20 years of age who had been unemployed for over 12 months. I will, with permission, circulate the comparative information requested in the Official Report.
    Mr. Powell: Does the Secretary of State share the views of the right hon. Member for Henley (Mr. Heseltine) that his Government and his party must switch to caring Conservatism and caring capitalism? Is he not aware of the total degradation and frustration that unemployment creates in our schools, homes and throughout society? Is he not concerned that the attitudes of desperation are leading to the escalation of violence and crime in the Principality in particular? Is he not concerned about the young who are now taking to drugs? Is it not time that he joined his colleagues in protesting—
    Mr. Speaker: Order. That is a very long question.
    Mr. Powell:—for a change in attitudes or a change in leadership?
    Mr. Edwards: I am greatly concerned by the current levels of unemployment. I do not think that it needs a switch or a change of attitude, because that concern is clearly shared by all Ministers and members of the Government. If the hon. Gentleman refers to changes in attitude, I welcome the substantial changes in attitudes and performance which have happened generally throughout industry. However, I think that it is necessary for those in employment to recognise that pay increases for those in work create unemployment.
    Sir Raymond Gower: Is not the description by the hon. Member for Ogmore (Mr. Powell) of violence in Wales a gross misrepresentation of the real position and a distortion of the conditions which obtain?
    Mr. Edwards: I think that perhaps the most important thing in the future of job creation in Wales is the high reputation which has been gained here and abroad by firms in respect of the attitude and performance of the Welsh work force and those who live in Wales. They have an image, not of violence and hostility, but of a work force which will co-operate to the full to make a success of companies. That is where the future lies.
    Mr. Ron Davies: Giver, that in Wales there is little realistic prospect of young people obtaining any sort of work and that they have to rely almost entirely on the youth training scheme, what is the Secretary of State's response to the recent decision of the Mid-Glamorgan area manpower board to refuse to sanction any further youth training schemes in 1986–87?
    Mr. Edwards: It is not true that there is no prospect for young people in Wales. It happens that I have been round two major companies in Wales which are taking on labour at the present time, with an average age of 18½. Two of the other companies which I have recently been round in south Wales have an average age of under 27. The truth is that many young people are obtaining employment. I am concerned that agreement has not yet been reached in Mid-Glamorgan about proposals put forward by the Manpower Services Commission. I believe that these problems can and will be overcome. I note with satisfaction that other providers of training have said that they would provide and take up the training places if necessary. I hope that in the reality that will not prove necessary.
    Sir Anthony Meyer: As the Labour party has now as good as admitted that there is nothing that it can do about unemployment in the short term, is it not clear that the best and quickest alleviation of the problem lies in further expansion of the community programme? Will my right hon. Friend do all that he can to press for the removal of the remaining obstacles in the way of an expansion of that programme?
    Mr. Edwards: I agree with my hon. Friend that the community programme is very important for the long-term unemployed. At the end of December last year there were over 12,000 filled places in Wales, and the aim is to expand that total to 20,500 by June.
    Mr. Foot: In view of the answer that the Secretary of State gave about training, does he not think it absurd and intolerable that the Government should be insisting, through the Manpower Services Commission, that extra funds should be made available by local authorities, particularly in the areas that are hardest hit, to keep the

    621
    training schemes going? Why does the right hon. Gentleman not come out boldly and say that the Government should pay for that? Has he cleared up the confusion of his colleague, because the Employment Minister said only a couple of weeks ago that no burden would be put on the local authorities? Why should we have to bear that burden in Wales?
    Mr. Edwards: I take it not very well when the right hon. Gentleman, of all people, lectures this Government on youth training, while his Government totally failed to make provision for proper youth training, and this Government have launched the largest programme of youth training ever undertaken in this country and are now extending the YTS from one to two years. I am sorry that the right hon. Gentleman left us such a monstrous backlog to catch up.
    Mr. Wigley: Despite the youth training jobs and the other jobs that have been brought on stream, does the Secretary of State not recognise that, with unemployment more than doubled since his Government came to office in 1979, the time has come for there to be a change of policy? How much worse does the situation have to get before we have that change of policy?
    Mr. Edwards: I notice that the hon. Gentleman does not tell us what the policy is that will produce growth without inflation, although I hope that he will at least welcome the fact that we are in the fifth year of growth, that inflation continues to fall, that we have the fastest growing economy in Europe, that manufacturing investment has grown steadily since 1983, and that a large number of firms in Wales are undertaking massive investment and massive expansion and are taking on people, as I have discovered when visiting several of them in the past few weeks.
    Mr. Best: Is it not a fact that the measures that the Government have introduced — the community programme, the enterprise allowance scheme, the job start scheme, and all the other measures to help the long-term unemployed — are the envy of any Socialist Government, and are far more imaginative than anything put forward by the Opposition when they were in government? Will my right hon. Friend remind the House of how many jobs have been created in this country compared with other European countries, and of the percentage of those employed in this country compared with other countries in the EEC?
    Mr. Edwards: My hon. Friend is right to draw attention to all those matters. The fact is that the scheme would not have been the envy of the Labour Government, because they failed to take the necessary measures which have been introduced by this Government against a most difficult background.
    Mr. Roy Hughes: Will the Secretary of State confirm that regional aid to Wales has fallen by 40 per cent. since 1979 and is due to fall further until 1990? With such massive unemployment, as outlined by my hon. Friend the Member for Ogmore (Mr. Powell), is not the trend towards social disintegration? Is it not time that the right hon. Gentleman realised that Wales has been at the receiving end, not of caring capitalism, but of naked, aggressive and irresponsible capitalism?
    Mr. Edwards: The hon. Gentleman talks about regional policy. It is effective in relative terms, and Wales
    622
    is very well placed, as is borne out by the fact that over about three years we have obtained about 20 per cent. of all inward investment to this country, and in 1985 we obtained 48 overseas projects—over double the 1983 figure. Only last week we secured for Wales one of the best high technology research British-based companies. Renishaw Research Ltd. is opening a new factory in Gwent, and more than 500 people will be taken on by this world-leading firm.
    Following is the information:

    Constituency

    Males

    Females

    Alyn and Deeside

    78

    67

    Clwyd North West

    92

    73

    Clwyd South West

    101

    58

    Delyn

    76

    61

    Wrexham

    137

    82

    Carmarthen

    63

    52

    Ceredigion and Pembroke North

    58

    56

    Llanelli

    77

    79

    Pembroke

    107

    124

    Blaenau Gwent

    155

    77

    Islwyn

    93

    33

    Monmouth

    67

    49

    Newport East

    152

    95

    Newport West

    134

    95

    Torfaen

    93

    83

    Caernarfon

    64

    33

    Conwy

    63

    31

    Meironnydd Nant Conwy

    30

    17

    Ynys Mon

    80

    69

    Bridgend

    77

    53

    Caerphilly

    179

    69

    Cynon Valley

    158

    70

    Merthyr Tydfil and Rhymney

    254

    147

    Ogmore

    158

    78

    Pontypridd

    179

    81

    Rhondda

    237

    112

    Brecon and Radnor

    35

    31

    Montgomery

    28

    20

    Cardiff Central

    167

    85

    Cardiff North

    57

    34

    Cardiff South and Penarth

    141

    83

    Cardiff West

    153

    112

    Vale of Glamorgan

    85

    65

    Aberavon

    110

    86

    Gower

    81

    49

    Neath

    70

    92

    Swansea East

    172

    127

    Swansea West

    223

    127

    Wales Totals

    4,284

    2,755

    Note: The bandings of the analysis of the age of claimants and duration of unemployment are such that data in respect of those aged under 21 years cannot be extracted. The figures are for claimants aged under 20 who have been unemployed for over 52 weeks.
    Mr. Speaker: I have allowed a long run on this first question. We must now get on. I ask the House for shorter supplementary questions.

    Hospital Waiting Lists
    Dr. Marekasked the Secretary of State for Wales what representations he has had regarding hospital waiting lists; and if he will make a statement.
    The Parliamentary Under-Secretary of State for Wales (Mr. Mark Robinson): From time to time I receive representations about waiting lists, usually based on individual cases. There are many different reasons why waiting lists develop in individual specialties. Health authorities have been asked to examine their lists and my

    623
    Department is currently arranging a workshop with their representatives to consider the problems identified and the development of possible solutions.
    Dr. Marek: I hope that the Under-Secretary of State will not sail in the same direction as the Secretary of State, who is on his way out with the Prime Minister. Will he take a refreshing, long look at the extraordinary waiting list in the Principality? In Wales, 130,000 people are waiting to get into hospital, and more than 10,000 have been waiting for in-patient treatment for more than a year. Let us have some truth and honesty for once from the Government. Will the Minister advise me? On Friday I talked to a constituent in Clwyd who is suffering from hair loss because of a disease of the scalp. She has been told that she cannot see a consultant for three months. What is the Minister's advice to my constituent?
    Mr. Robinson: The hon. Member suggests that I do not give comparative figures, but sometimes it is a good idea. The rate of increase of in-patient waiting lists has remained roughly consistent with that of the previous Labour Government. The rate of increase in terms of outpatients has fallen by 5 per cent. under the Government. With regard to the hon. Gentleman's constituent, if he will write to me with the details I shall have the case considered.
    Mr. Raffan: Will my hon. Friend take this opportunity to congratulate Clwyd health authority on its productivity record, especially on halving the eye treatment waiting list during the past year? Will he acknowledge that Clwyd's financial allocation for 1986–87 is not as generous as it might at first appear, because 2·5 per cent. of the 5·5 per cent. increase is needed to meet the cost of pay awards not fully funded last year, leaving only 3 per cent. to cover growth of services, advances in technology and other urgently required improvements in the services?
    Mr. Robinson: I know that Clwyd is currently conducting a study of its waiting lists. I welcome its action. With regard to resources in this year's allocation to Clwyd, the conditions in which they were announced were the same for Clwyd as for every health authority in Wales. I should point out that since 1979 resources for Clwyd have increased, taking into account those allocations, by just over 32 per cent.
    Mr. John: As Pontypridd district hospital is responsible for 8,000 out-patient treatments per year, and as that hospital is scheduled for closure, what sense is there in adding those to the existing lists in Mid-Glamorgan? Must the population of Mid-Glamorgan now look for admission to one of the hon. Gentleman's famous workshops?
    Mr. Robinson: The decision about what services to provide in Mid-Glamorgan is one for that health authority.
    Mr. Gwilym Jones: Does my hon. Friend accept that the improvements in the National Health Service under this Government, and the improved treatment, when not such good treatment, or even no treatment, was possible before, have encouraged longer waiting lists? What are the waiting times for those on the waiting list?
    Mr. Robinson: My hon. Friend has made a well thought out and valid point. In terms of throughput, inpatient treatment has increased by 18 per cent. Under the Labour Government it increased by only 6 per cent. Outpatient treatment has increased by 12 per cent. Under the previous Labour Government it fell by 3·5 per cent.

    Rate Support Grant
    Mr. Wigleyasked the Secretary of State for Wales how many representations he has received from local authorities in Wales concerning the rate support grant settlement for 1986–87; and how many of these expressed dissatisfaction with the settlement.
    Mr. Nicholas Edwards: I have received letters from four local authorities, and five hon. Members have written expressing concern on behalf of their local authorities.
    Mr. Wigley: As the eight counties in Wales have had to increase their rates by between 11 and 28 per cent. to make up for the loss in real terms of rate support grant from the Welsh Office, does the Secretary of State agree that the blame for the rate increases that will hit the people of Wales later this year must be laid fairly and squarely at the door of the Welsh Office?
    Mr. Edwards: No, I do not agree. Provision is up, above the expected rate of inflation, and the settlement is extremely generous in relation to the settlement in England and the past performance of Welsh local government. I can see no possible justification for some of the very large rate increases that have been proposed by counties in Wales. I believe that they will be damaging, not only to those who have to pay the bills, but to employment prospects, about which people have been expressing concern.
    Sir Raymond Gower: What circumstances explain the difference in the rates proposed by Welsh counties this year and those imposed last year, apart from the fact that there were local government elections last year?
    Mr. Edwards: In the case of South Glamorgan, my hon. Friend may have a point. I understand that the county council spent about £3·5 million of balances last year and has decided not to spend them this year. I believe that the county council should justify the proposed rate increase to its ratepayers and local people. I do not believe that any proper justification has been given for it.
    Mr. Barry Jones: I urge the right hon. Gentleman to cease his attacks on the Welsh county councils. No one wants higher rates, but I remind the Secretary of State that the counties are facing demands on their services that are a consequence of cuts and high unemployment. Does the right hon. Gentleman agree that Gwynedd county council has a first-rate case, because Holyhead town has a male unemployment rate of about 27 per cent.?
    The county of Clwyd faces a loss of £2 million because of technical changes in the rate support grant assessment. I remind the right hon. Gentleman again that 25,000 people in Clwyd are seeking work. The Secretary of State's financial policies in local government are virtually in ruins. He should acknowledge the difficulties of the counties at a time of high unemployment.
    Mr. Edwards: In my view, none of that justifies, for example, South Glamorgan proposing an increase in precept of six times the forecast rate of inflation. The hon. Gentleman refers to Gwynedd, where expenditure per head is the highest in Wales, block grant per head is higher than the Welsh county average, and grant-related expenditure per head is the highest in Wales. That does not make a particularly good case for the hardships of Gwynedd.
    I know that Clwyd has difficulties, but it is a high-spending authority which has increased the numbers in its

    625
    employment while other counties have found it possible to reduce the numbers that they employ and, therefore, reduce their costs. Perhaps the county council might have a go at that.
    Mr. Harvey: Although many Conservative Members have reservations about the rate support grant for Clwyd, we find the proposed 15·7 per cent. rate increase totally unacceptable. Will my right hon. Friend condemn it?
    Mr. Edwards: I hope that local ratepayers and employers, in particlar, will make clear to the county council what the consequences will be if it proceeds with its rate proposal.

    Labour Statistics
    Mr. Barry Jonesasked the Secretary of State for Wales by how much unemployment has increased in Clwyd and in Wales since 1979, expressed as a total and as a percentage.
    Mr. Nicholas Edwards: On 9 January 1986 there were 25,786 unemployed claimants in Clwyd. A comparable claimant-based figure for January 1979 is not available. For Wales as a whole, for the same dates, the seasonally adjusted claimant-based figures were 176,500 and 75,100 respectively, an increase of 135 per cent.
    Mr. Jones: Those figures invalidate the remarks of the Secretary of State in answer to a previous question. When will this waste of human resources in Wales end? When can measurable numbers of our people look to work that will get rid of the distressing dole queues?
    Is the right hon. Gentleman aware that the labour market report by the Manpower Services Commission stated that three quarters of all job losses in Wales were in the manufacturing sector? The deindustrialisation of Wales under this Government continues apace. Does the right hon. Gentleman realise that we are losing blue chip companies such as Courtaulds, Metal Box, Lucas, BP, and we now are losing the Milk Marketing Board? We ask the right hon. Gentleman to ensure in Cabinet a change of economic policy, to help the people of Wales get more work.
    Mr. Edwards: The hon. Gentleman must remember that during the lifetime of this Government the number of people eligible to work has increased by about 35,000. An increasing number of people are coming on to the labour market.
    This Government have had to deal with what I believe may be the final stage of the decline of the old basic industries in Wales — a process that has been taking place for many generations. We must build on the substantial number of new companies that we have succeeded in attracting to Wales during the past few years.
    Only last Friday I visited a factory in Clwyd—Ega Limited—which is undergoing massive investment, has taken on 100 people during the past 12 months and is absolutely confident that its expanison will continue. It is the sort of company that offers prospects for young people, including the hon. Gentleman's constituents.
    Mr. Geraint Howells: The right hon. Gentleman has held the high office of Secretary of State for Wales for almost seven years, during which time there has been the highest ever unemployment percentage in Cardigan. As
    626
    nothing was done during those years to alleviate the problem, what advice will he give today to the unemployed young people in that area?
    Mr. Edwards: To say that nothing has been done is to deny the facts. The hon. Gentleman knows well of the considerable efforts, some of them very successful, of Mid-Wales Development. He also knows of the measures taken in his constituency. I think, for example, of Aberystwyth, where there have been new projects and where a number of new factory units have been built.
    The hon. Gentleman knows well of the considerable efforts in mid-Wales—for example, the grant scheme—to create new jobs in rural areas. To say that nothing is being done is simply untrue, as he knows.
    Mr. Grist: Has my right hon. Friend noticed that the hon. Member for Alyn and Deeside (Mr. Jones) has recently been going around Wales making promises which, if allied to the remainder of the Opposition's policies, would set off a rate of inflation that would undermine any hope of investment in this country—the very investment that is the hope for the future?
    Mr. Edwards: Yes, I have noted that, and the hon. Member for Alyn and Deeside (Mr. Jones) has been doing that at a time when his right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) has been pointing to the castasrophic dangers of inflation again being let loose and suggesting that it was time that the Opposition worked out a policy to deal with that priority.
    Mr. Roy Hughesasked the Secretary of State for Wales what are the latest figures for unemployment in (a) Newport, (b) Gwent and (c) Wales; what were the equivalent figures in May 1979; and what was the percentage increase in each case.
    Mr. Nicholas Edwards: On 9 January 1986 unemployed claimants totalled 13,300 in the Newport travel-to-work area and 30,718 in Gwent. Comparable claimant-based figures for May 1979 are not available. For Wales as a whole, for the same dates, the seasonally adjusted claimant-based figures were 176,500 and 74,200 respectively, an increase of 137·9 per cent.
    Mr. Hughes: Do not those outrageous figures reveal the complete collapse of the crackpot economic strategy with which the Secretary of State has been so closely associated? What guarantee can he give the House today that the figures will not shortly reach 200,000? If he cannot give that guarantee, when they reach that level will he resign?
    Mr. Edwards: The figures are rather more representative of the position that we found at the Llanwern steelworks in the hon. Gentleman's constituency when we came into government. It was grossly overmanned, inefficient and had no prospects for any future. It has now become one of the most efficient and competitive steel plants in the world and is actually taking on labour.
    Mr. D. E. Thomas: I do not want to accuse the Secretary of State of being an economic illiterate, but does he not accept that Opposition Members have asked macroeconomic questions, while he has taken us on a macroeconomic tour of some of the plants in Wales with which he has been involved during the past couple of months? That is not the answer that we need. We need a strategic answer, and he is not giving one.
    Mr. Edwards: If the hon. Gentleman, of all people, having studied the history of Wales, does not understand that the decline of old basic industries and the attraction into Wales of new industries that will form a foundation for the future is the key economic issue confronting the Principality, I can only say that I am astonished and that he jolly well ought to know.
    Mr. Harvey: Is my right hon. Friend aware of the insensitive way in which the Muntz Plastics factory in my constituency is laying off 130 workers? Will he guarantee to provide the support necessary to ease those lay-offs?
    Mr. Edwards: The commercial decision must be taken by the company, but my hon. Friend knows that the Government have provided massive assistance to Clwyd to help deal with redundancies there, especially during the past 12 months. The Government have made a substantial allocation of urban aid, and we shall continue to provide that part of port-east Wales with support at the highest level. Such assistance makes that part of the country especially successful in attracting new industry and investment.
    Mr. Rogers: Does the right hon. Gentleman agree that circumstances in Wales are disastrous and that the inward investment of which he speaks is not on a sufficient scale to solve the deep problems of Wales? Will he ask the National Coal Board to stop importing foreign coal which is destroying our mining industry? If the right hon. Gentleman really wants to do something about jobs, why does he not protect our fragile industrial structure rather than destroy it by his weak-kneed and pathetic subservience to the Prime Minister?
    Mr. Edwards: The National Coal Board has imported coal for two reasons. It has imported special coals, which are not readily available in Britain, and coal required by the British Steel Corporation, which has to survive in an internationally competitive market. The hon. Gentleman is suggesting that the BSC should operate with one hand tied behind its back to help his miners.

    Council House Sales
    Mr. Knoxasked the Secretary of State for Wales how many council houses have been sold to sitting tenants in Wales since May 1979.
    Sir Raymond Gowerasked the Secretary of State for Wales how many council dwellings have been sold to tenants (a) in the area of the Vale of Glamorgan council, (b) in the county of South Glamorgan and (c) in Wales since May 1979.
    Mr. Mark Robinson: Between May 1979 and the end of last year 2,057 council dwellings were sold in the Vale of Glamorgan and 5,963 in South Glamorgan out of the estimated total of 46,000 sales in the whole of Wales. Taking sales by Cwmbran development corporation, Mid Wales Development and housing associations into account, under this Administration over 50,000 public sector tenants in Wales have now bought their homes.
    Mr. Knox: How does the number of sales in the whole of Wales compare with the number of right-to-buy applications in Wales?
    Mr. Robinson: Ninety per cent. of live applications have been processed.
    Sir Raymond Gower: As the existing legislation varies the terms under which people can buy and resell, does my hon. Friend think it desirable that they should be publicised by his Department?
    Mr. Robinson: My hon. Friend makes an important point. We propose, in the Housing and Planning Bill, to increase the discounts for flats to a maximum of 70 per cent. and to introduce measures to provide further protection for buyers of flats against unexpectedly high service charges. We also propose to reduce from five to three years the period during which discount would be repayable. That applies to flats and houses. We shall consider a publicity campaign when that Bill becomes law.
    Mr. Roy Hughes: How many houses in Wales are unfit for human habitation? How many lack one or more of the basic amenities? Why has the money from the sale of council houses not been given to local authorities so that they can build houses for those who have to live in deplorable conditions?
    Mr. Robinson: The Government have spent £275 million on private sector renovation, compared with the Labour Government's £57 million, and £205 million on public sector renovation, compared with the Labour Government's £86 million.
    Mr. Best: Is it not a fact that the Government have given a dignity to council tenants which the Labour party has consistently denied them? The Government have enabled council tenants to buy council houses, which was consistently denied them by the Labour party; the Government have given council tenants a tenant's charter which enables them to do things with their council houses and to take in lodgers, which the Labour party has denied them; and the Government have introduced the right to repair as from 1 January 1986, which gives council tenants the opportunity to repair their homes, which the Labour party has again consistently denied them.
    Mr. Robinson: I entirely agree with all of my hon. Friend's points. I only hope that that dignity will not be taken from council tenants by the Labour party if its policy document on the future of council house sales is put into effect.

    Perinatal Mortality
    Mr. Gareth Wardellasked the Secretary for Wales what was the perinatal mortality rate in (a) Wales and (b) West Glamorgan in (i) 1979 and (ii) for the most recent available date.
    Mr. Mark Robinson: The perinatal mortality rate for Wales was 15·6 per thousand total births in 1979, and the corresponding rate for West Glamorgan was 18 per thousand total births. By 1984, the latest year for which this information is available, the rates had fallen to 10·5 and 9·2 respectively.
    Mr. Wardell: Will the Minister assure the House that a comprehensive service for the newly born in Wales will be instituted, including a paediatric cardiologist, a paediatric cardiac surgeon and a paediatric surgeon so that babies born in Wales are given the same first-class service as babies born in England?
    Mr. Robinson: Those matters must be considered by individual health authorities in terms of the priorities that

    629
    they determine. However, the Government have had considerable success in reducing the perinatal mortality rate, which is part of the success of our perinatal mortality initiative.
    Mr. Terlezki: Will my hon. Friend tell the House whether there have been any improvements in the maternity service in Wales?
    Mr. Robinson: There has been considerable improvement in the maternity service in Wales in recent years, and the figures that I have quoted bear that out.

    Welsh Water Authority
    Mr. Rowlandsasked the Secretary of State for Wales what discussions he has had with the chairman of the Welsh water authority regarding the privatisation of its services; and if he will make a statement.
    Mrs. Clwydasked the Secretary of State for Wales when he last met the chairman of the Welsh water authority; what subjects were discussed; and if he will make a statement.
    Mr. Nicholas Edwards: I spoke to the chairman of the Welsh water authority about water privatisation only last week. Both my hon. Friend and I regularly discuss the authority's affairs with the chairman. I have nothing to add to the statement that I made last week.
    Mr. Rowlands: Does the Secretary of State not realise how deeply offensive it is to the overwhelming majority of Welsh people to introduce the concept of profiteering into such a basic supply as water to householders? Does he accept that privatisation is supposed to be a part of competition, but that there will be no such competition regarding the water supply? Does he agree that he has no mandate to introduce this system before the general election?
    Mr. Edwards: Many people in Wales will wish to participate and own shares in the company. It is not true that there is no room for competition. There certainly is room for greatly improved services and efficiency, and that is to the benefit of all water users in Wales.
    Mrs. Clwyd: The Secretary of State will no doubt recall that on Wednesday he told us that the chairman of the Welsh water authority was in favour of privatisation, and that I told him that I had spoken to the chief executive who told me that he could see no value in privatisation for consumers or employees. Will he tell the House who is speaking for the Welsh water authority? Is it the chairman, whom he appointed, or the chief executive, who is speaking for both the authority and the majority of people in Wales?
    Mr. Edwards: The chief executive of the Welsh water authority has written to me about the statement that the hon. Lady quoted. In his letter to me he states:
    "I am very sorry that confusion was caused but I would like to set the record straight and make it clear that I said nothing of the sort to Mrs. Clwyd."
    He concludes:
    "I hope you do not mind my writing to you to set out the facts but I do feel particularly aggrieved when words attributed to me in the House were a complete fabrication."
    Mr. Raffan: Will my right hon. Friend remind the Opposition that 25 per cent. of the water in Britain is already supplied by private sector water companies
    630
    efficiently and without complaint? Will he hammer home the fact that privatisation will free the Welsh water authority from financial constraints, allow it to borrow money more cheaply and thus accelerate its capital programme?
    Mr. Edwards: I agree with every word that my hon. Friend has uttered.
    Mr. Livsey: What will happen to tenanted farms, forestry and land if the Welsh water authority is privatised? Will farmers be able to buy their own farms from the authority?
    Mr. Edwards: The position will be exactly as it is now. The water authority will retain such land as it thinks necessary for its operations. Those whom the hon. Gentleman mentions will benefit from a more efficient authority which can provide a better service.

    Heart Disease
    Mr. D. E. Thomasasked the Secretary of State for Wales what was the total expenditure, in the latest year for which figures are available, by his Department on measures to reduce the incidence of heart disease in Wales.
    Mr. Mark Robinson: The Welsh heart programme is receiving very substantial support from the Government. The Health Education Council has pledged £1·5 million over a period of five years. In addition, when I visited Heartbeat Wales on Friday, I announced that the Welsh Office was adding £30,000 to the £100,000 already granted in this financial year and, subject to the usual processes of parliamentary approval, £200,000 in the next.
    Mr. Thomas: I welcome the Minister's announcement of his visit to Heartbeat Wales last Friday. All who are concerned about the level of heart disease in Wales support the programme. Does the hon. Gentleman accept that the amount of expenditure on advertising by cigarette manufacturers in Wales during the period of this campaign is something that we must all condemn? Will the Government take action directly against the cigarette manufacturers over this issue?
    Mr. Robinson: The Government are reviewing the existing voluntary arrangements with the tobacco industry. I should not wish to speculate on the outcome of these discussions, but I am sure that the views of the medical profession will be taken into consideration. I share the hon. Gentleman's support for the work of Heartbeat Wales.
    Dr. Roger Thomas: Cannot complex congenital heart disease be treated at Morriston and Cardiff instead of patients having to go to Bristol, Hammersmith and Birmingham?
    Mr. Robinson: The services that a hospital provides are a matter for the health authority to consider. At the same time, we have centrally-funded services, which we review from time to time.
    Mr. Grist: Is my hon. Friend aware of the alarming increase in smoking among schoolchidren? If we are to get on top of heart disease, is it not essential to get on top of the problem of child smokers?
    Mr. Robinson: I am aware of my hon. Friend's point. This problem is particularly disturbing and prevalent

    631
    among young girls. We are taking steps to increase our public relations profile within schools to try to alleviate the problem.

    Mid-Glamorgan Area Health Authority (Funding)
    Mr. Ron Daviesasked the Secretary of State for Wales what representations he has received concerning the level of funding to Mid-Glamorgan area health authority.
    Mr. Mark Robinson: My right hon. Friend has received a number of written representations from residents of Mid-Glamorgan. We have also recently met the chairman of the health authority to discuss its financial position.
    Mr. Davies: Does not the fact that there is real disquiet on the part of those involved in the Health Service in Mid-Glamorgan cause anxiety to the Minister? Does he accept that Wales has one of the lowest per capita expenditures on the National Health Service in Europe and that the 5·5 per cent. allocated to Mid-Glamorgan for 1986 is inadequate? Is he aware that we have the third longest waiting list for hospital admissions in the whole of the United Kingdom and that there is no prospect of an improvement in that situation until he and the Government start to change their policies?
    Mr. Robinson: We are concerned about the situation in Mid-Glamorgan. That is why we are helping the health authority in its current difficulties. However, on the basis of the latest formula assessment, Mid-Glamorgan is shown to be funded at virtually the correct level.

    Block Grant (Clwyd)
    Mr. Raffanasked the Secretary of State for Wales what representations he has received about the reduction in Clwyd's block grant figure for 1986–87 between the provisional announcement last July and December's settlement.
    Mr. Nicholas Edwards: The county chief executive and treasurer have written to me, as has my hon. Friend.
    Mr. Raffan: When my right hon. Friend decides how to re-distribute the underclaimed grant, will he give special consideration to Clwyd's financial predicament, which his own officials concede has been aggravated by what they describe as the "unfortunate" wide difference between its provisional and final block grant figures?
    Mr. Edwards: I agree that there was a change between the provisional indications and the final figure, for the reasons that have been given previously in the House and in correspondence. I shall certainly bear in mind what my hon. Friend says, but I have also made it clear that it is not my intention to use those funds to encourage or compensate high-spending authorities. I shall have to take proper account of those authorities which have sought to meet, and have succeeded in meeting the Government's objective.

  CHURCH COMMISSIONERS

    Staff
    Mr. Greenwayasked the hon. Member for Wokingham, as representing the Church Commissioners, how many staff are paid, fully or in part, by the Church
    632
    Commissioners, to work in the service of diocesan bishops, at what cost and in what capacities; and if he will make a statement.
    The Second Church Estates Commissioner, representing Church Commissioners (Sir William van Straubenzee): There are 177 full-time or part-time staff working in the service of diocesan bishops. They include 21 chaplains, 88 secretaries and 68 chaffeurs, handymen and gardeners. The cost to the commissioners is £893,000 per annum.
    Mr. Greenway: Has my hon. Friend ever had a ride in a bishop's car? When do bishops have chauffeurs and when do they not? Secondly, what do the handymen do that the bishops cannot do? Thirdly, why was £10,000 spent on research into the political attitude of the vicars and other clergy?
    Sir William van Straubenzee: For the average diocesan bishop, the staff is one part-time chaplain, two full-time secretaries, one part-time chauffeur and one part-time gardener-handyman. I have no doubt that the bishops are more than capable of doing the work for themselves, possibly with the exception of secretarial work. However, the support that they need to fulfil their wider diocesan work must result in their being backed up adequately, and that is the reason for the expenditure.
    Mr. Stokes: Is my hon. Friend aware that it is necessary for bishops to have a proper advisory secretarial staff so that, when they speak on public affairs, their remarks are well-informed? Does my hon. Friend agree that they have a right so to speak, whether or not we agree with what they say?
    Sir William van Straubenzee: I agree entirely with my hon. Friend. It must be remembered that some of the bishops have very long distances to travel to the ends of their dioceses, and many of the senior bishops have duties to perform outside their dioceses.
    I must apologise to my hon. Friend the Member for Ealing, North (Mr. Greenway) for not replying to his question about £10,000 being spent on research. The money for the survey to which he referred was not provided by the Church Commissioners, and I am not, therefore, answerable for it to the House. The survey embraced a number of social and other attitudes, and the results were helpful in the compiling of a report.
    Mr. Campbell-Savours: Does the hon. Gentleman not get tired of veiled attacks on the Church by his hon. Friends?
    Sir William van Straubenzee: I do not think that they are attacks. Sometimes questions come from pleasant hon. Friends who just wish to put an edge on the courtesies that they would like to extend to me.
    Mr. Winnick: Did the Church Commissioners or the bishops have any comments to make on the remarks of the hon. Member for Halesowen and Stourbridge (Mr. Stokes), who said about the then Secretary of State for Trade and Industry—
    Mr. Speaker: Order. The hon. Gentleman's supplementary question does not seem to be much related to bishops' staffs.
    Mr. Winnick: I am coming to that, Mr. Speaker. The hon. Gentleman said that the former Secretary of State for Trade and Industry should be replaced by a red-blooded Englishman. Do such—
    Mr. Speaker: Order. That has nothing to do with the question.

    Clergy (Stipends)
    Mr. Peter Bruinvelsasked the hon. Member for Wokingham, as representing the Church Commissioners, what information the commissioners have as to the number of clergy whose stipends are topped up by other organisations or employers in respect of chaplaincies and other appointments; and if he will make a statement.
    Sir William van Straubenzee: Approximately 1,200 out of the 8,300 vicars and rectors receive part of their stipends in part-time chaplaincies and similar appointments.
    Mr. Bruinvels: I thank my hon. Friend for revealing the number of clergymen who receive additions to their stipends. Can he give information and details about the amount that is given to top up the £7,000 stipends for those clergymen who go into schools, or should be encouraged to do so, to check whether religious education is being properly taught and whether the morning assembly is being carried out? Does that form part of the duties of the clergy, or should it be part of their duties under the Education Act 1944?
    Sir William van Straubenzee: I must not mislead my hon. Friend. The figures that I gave were with part-time earnings taken into account, and not additional.
    On the second point, it is not likely that any financial consideration is involved in entering into schools, but, like my hon. Friend, I attach the greatest importance to the presence of the clergy in their parish on appropriate occasions.
    Mr. Frank Field: Given the importance of the laity's contribution to the level of the clergy's salaries, is it not a little rich for the hon. Member for Leicester, East (Mr. Bruinvels) to ask such questions when, before Christmas, he was asking us to take strike action to reduce the amount of money available to the Church?
    Sir William van Straubenzee: I do not think that my hon. Friend the Member for Leicester, East (Mr. Bruinvels) needs any protection from me for any statements that he makes in the country or in the House.

  THE ARTS

    Industrial Archaeological Heritage
    Mr. Adleyasked the Minister for the Arts what steps he is taking to promote the preservation of the nation's industrial archaeological heritage.
    The Minister for the Arts (Mr. Richard Luce): My responsibility for the industrial archaeological heritage relates primarily to museums and their collections. My arts budget supports the relevant national museums, the local museum purchase and conservation grant funds, and the national heritage memorial fund. While I encourage worthwhile industrial heritage preservation projects, the resources devoted to these by the institutions from within their grants are largely matters for their judgment.
    Mr. Adley: I thank my right hon. Friend for his reply, and I declare an interest. Does he agree that the Science museum and the National railway museum have a vital role to play in preserving the nation's industrial archaeology and that they value their independent status, which is a source of confidence to them? Will my right hon. Friend therefore confirm that he has no plans to change the system whereby each museum has its own parliamentary Vote?
    Mr. Luce: I acknowledge that my hon. Friend has a very close interest not only in the Science museum but in the National railway museum. I know the important role that he plays in their affairs. I am glad that the Science museum spends a considerable amount of its annual purchase grant on industrial items. As for the last part of my hon. Friend's question, a written statement will be published at 3.30 this afternoon.

    Business Sponsorship
    Mr. Yeoasked the Minister for the Arts what is the present level of business sponsorship for the arts.
    Mr. Luce: The Association for Business Sponsorship of the Arts estimates the figure at about £20 million.
    Mr. Yeo: Does my right hon. Friend agree that the level of business sponsorship could be substantially increased if companies were allowed, along the lines of the American model, to deduct their donations to charity up to an agreed limit of pre-tax profits? Does he further agree that that would be cost effective, because, for each pound of tax revenue forgone, expenditure on the arts would increase by almost £3?
    Mr. Luce: It is important to acknowledge the significant contribution that the business sponsorship incentive scheme has made to increasing the amount of money for the arts in the last 15 or 16 months. It now amounts to £6·7 million. That is a great deal of additional money for the arts, and I have increased the amount in the financial budget for the forthcoming year. My hon. Friend knows that a number of positive tax changes have been made in the last few years. They are designed to encourage additional business sponsorship of the arts, and I hope that there will be further improvements. My hon. Friend's specific question ought to be addressed to my right hon. Friend the Chancellor of the Exchequer.
    Mr. Freud: I thank the Minister for looking further into the question raised by the hon. Member for Suffolk, South (Mr. Yeo). Will he tell the House how many applications, under the business sponsorship incentive scheme, were turned down last year because it had run out of money?
    Mr. Luce: The scheme has not run out of money. It is continuing throughout this financial year. I have already announced that there will be an increase in the taxpayers' investment in the scheme to the tune of £1·75 million in the coming financial year.
    Mr. St. John-Stevas: Since business sponsorship has tragically failed to raise the small sum of money needed to keep the Sadler's Wells theatre open, what plans has my right hon. Friend for finding the £250,000 that would save the nation from a major cultural disaster?
    Mr. Luce: I acknowledge the importance of my right hon. Friend's question, and I am glad to be able to tell the

    635
    House that the Arts Council has made an announcement on that important matter today. It has called a meeting with Sadler's Wells and the three companies which regularly use the theatre to discuss a possible solution. That would involve the Arts Council giving the companies additional funds to enable them to pay an economic rent for the theatre. I hope and believe that in that way the theatre can be kept open.
    Mr. Tony Banks: Is the Minister aware that the figure of £20 million for business sponsorship is only an estimate, and I believe that it is far less than that? Will he take steps to ensure that the recording of business sponsorship money for the arts is more accurate than the present guesstimates, otherwise a misleading impression will be given?
    Mr. Luce: I take the hon. Gentleman's point. In fact, I suspect that that is a conservative estimate. We work in conjunction with the Association for Business Sponsorship of the Arts, which exists to encourage the sponsorship of arts organisations by business. I accept that it is difficult to put a precise figure on it. It is a guesstimate.
    Mr. Alan Howarth: I strongly endorse the thoughts offered by my hon. Friend the Member for Suffolk, South (Mr. Yeo), but, in the meantime, will my right hon. Friend look at some of the anomolies in the present business sponsorship tax regime? In particular, will he consider whether sponsorship of capital projects could be made tax-deductible, as is sponsorship of revenue projects? Will he ensure that the rules governing the provision of entertainment facilities at sponsored events are both sensible and sensibly administered?
    Mr. Luce: I know that my hon. Friend takes a close interest in finding ways in which we can encourage further sponsorship and support for the arts. I know that some of those ideas have been put forward by ABSA and submitted to my right hon. Friend the Chancellor of the Exchequer. At the end of the day it is for him to decide what further improvements he can introduce.

    Local Government Reform
    Mr. Meadowcroftasked the Minister for the Arts whether he anticipates there being as much local arts activity after the abolition of the Greater London council and the metropolitan county councils as before.
    Mr. Luce: Genuinely local arts activity is a matter in which local authorities should play the leading part. The Government had agreed to take on a larger share of arts funding generally, following abolition, but central and local funds are both required if the amount and quality of arts activity are to be maintained.
    Mr. Meadowcroft: I accept what the Minister says about the need for partnership, but without backing from regional arts associations' funds, surely there is no way in which the local authorities can make that up? Is the right hon. Gentleman aware that the Royal Liverpool Philharmonic Orchestra believes itself to be under threat, and that, seven weeks away from abolition, there is no joint committee to administer the situation in West Yorkshire? Surely something must be done to ensure that the whole panoply of arts activities in the regions are better supported than they are.
    Mr. Luce: It is important to note that the Government have taken on considerable additional responsibilities on
    636
    behalf of the taxpayer and have thus relieved local authorities of burdens in the GLC and metropolitan areas to the tune of £43 million of additional taxpayers' money. We are not looking to an enormous sum in successor authority support for local arts activities. It is up to them to demonstrate the interest that they wish to show in their local arts activities.
    Mr. Jessel: As abolition might have affected Sadler's Wells, should we not all rejoice at the Arts Council's decision to try to find more funds to save Sadler's Wells and warmly congratulate my right hon. Friend on having used his influence to bring that about?
    Mr. Luce: I am grateful to my hon. Friend. It is, of course, principally the responsibility of the Arts Council to find a satisfactory solution. I am glad that it is to have this important meeting on Friday 14 February. I believe that it is moving towards a solution which will enable the theatre to remain open.
    Mr. Buchan: Is not it nonsense to dwell on the marvellous news about Sadler's Wells when almost every theatre and concert hall throughout the land is in a state of acute crisis? Is not the reason for that the right hon. Gentleman's failure to replace local authorities' funds? Is it not a bit of a sick joke to suggest that money could be found by the local authorities, which, when they try to spend it, are rate capped, and, when they are not rate capped, are abolished?
    Mr. Luce: It is unbelievable that the hon. Gentleman has managed to conjure up the most astonishing language to describe the fact that the Government have produced £43 million of additional money to support the arts in the GLC and metropolitan areas. I do not think that it is unreasonable to look to successor authorities, which already spend £7 billion, to play their small part in sharing in the sponsorship and support of arts activities.

    Library Service
    Mr. David Atkinsonasked the Minister for the Arts what discussions he has had with local authorities on efficiency savings in the library service.
    Mr. Luce: Management of the library service is a direct responsibility of local authorities, but I am concerned that full value should be obtained from the resources allocated to it. With this aim in mind, I commissioned studies of methods of costing library services and assessing their performance, which I hope will help local authorities to manage these services and monitor their effectiveness.
    Mr. Atkinson: Does my right hon. Friend agree that many of our libraries are located on prime sites in the community? Will he urge local authorities to explore the potential for partnership development schemes with the private sector? That will release resources which will make our already excellent library service even better for its customers.
    Mr. Luce: In the past few weeks I have visited a number of exceptional libraries, including Sutton, Hillingdon, and even some in my county. I have been impressed by the enterprise of a number of those libraries in providing additional services above the basic book loan service. That helps to improve the overall facilities available to the public in those areas.

Severe Weather Payments
Mr. Tony Benn: On a point of order, Mr. Speaker.
Several Hon. Members rose—
Mr. Speaker: Order.
Mr. Benn: My point of order does not arise out of Question Time. If other hon. Members have points of order that arise out of Question Time, I could put mine in a moment.
Mr. Speaker: Order. We shall move on to statutory instruments, but I shall take the point of order first.
Mr. Benn: The point I wish to raise arises from the exceptionally severe weather regulations made by the Secretary of State for Social Services. The weather conditions in Derbyshire have been severe. Under the regulations, the Secretary of State has given discretion to local managers of DHSS offices to decide whether to bring the regulations into effect to allow heating grants to be made to people on supplementary benefit.
My point of order concerns a matter of substance to thousands of people facing severe weather conditions who are likely to be denied their benefits. I cannot raise this matter in the House, because the Secretary of State has made regulations that put responsibility on local managers of DHSS offices. I cannot bring pressure through the House on the managers of local offices because they are not directly responsible to the House. This is a matter of great concern to a large number of people. I should be grateful to you, Mr. Speaker, if you would advise me on how the matter can be raised.
Mr. Speaker: The right hon. Member is a great expert in these matters. It is not a matter for the Chair to advise him how to raise matters in the House. He has already done that.

Questions to Ministers
Mr. Robert Adley: On a point of order, Mr. Speaker. My point of order arises out of Question Time.
In answering my question No. 27, my right hon. Friend the Minister for the Arts said that he would be making a written statement at 3.30 pm. Will you encourage Ministers who wish to make statements relevant to their subjects to answer questions in the morning, if they insist on giving written answers, so that we can see the answers and respond at Question Time?
Mr. Norman Buchan: Further to that point of order, Mr. Speaker.
I should like to back up strongly what the hon. Member for Christchurch (Mr. Adley) has said. There is another reason for my support. We have a mere 10 minutes of arts questions every three weeks. It would be useful, especially with this Department—it is true of all Departments—if we could have the information available so that we could get our teeth into some meat during this period.
Mr. Speaker: I am not responsible for written statements. I think that the Minister for the Arts meant that he would give a written answer.
Mr. Ray Powell: On a point of order, Mr. Speaker. There are two matters for which you are responsible. The first is the tabling of oral questions. I notice that on today's Order Paper, questions Nos. 22 and 24 were asked by one Conservative Member. Does that mean that other hon. Members will have licence in future to table more than one question, and, if so—
Mr. Speaker: Order. I draw the hon. Member's attention to the Order Paper. He will see that question No. 24 is to the Secretary of State for Transport—a different Department.
Mr. Powell: My second point, Mr. Speaker, relates to the coupling of questions. I know that you may not be responsible for—
Mr. Speaker: Order. We are taking time from private Member's motions. That is not a matter for me. I do not decide whether questions are linked. That is for the Department involved.
Mr. Powell: As you are not responsible for the coupling of questions, Mr. Speaker, which is the Minister's responsibility, I hope you will bear that in mind when it comes to calling hon. Members whose questions are coupled, because two Conservative Members have been called on supplementary questions on three occasions. Some Opposition Members, excluding myself, who tabled questions were not called because their questions were not reached.
Mr. Speaker: Order. The hon. Member knows that I do link questions where I can, but it is hardly fair to make that comment today when more Back Benchers were called from the Opposition side than from the Government side. If the hon. Member looks at the Order Paper, he will find that every hon. Member who had a question on the Order Paper to the Secretary of State for Wales was called this afternoon.
Mrs. Ann Clwyd: On a point of order, Mr. Speaker. Arising out of questions, the Secretary of

639
State for Wales accused me of misleading the House by quoting from a statement by the chief executive of the Welsh water authority. I should like to repeat that statement.
Mr. Speaker: Order. I cannot allow the hon. Lady to do that. That would be an extension of Question Time. We frequently hear answers in the Chamber with which we disagree. If I allow the Lady to take up such a challenge, I would have to do that for every other hon. Member. It would not be fair.
The Secretary of State for Wales (Mr. Nicholas Edwards): Further to that point of order, Mr. Speaker. As I quoted from the letter, I think it would be helpful if I were to lay the full text of the letter in the Library of the House of Commons. That is what I propose to do.
Mr. Barry Jones: I welcome what the Secretary of State has said, but he made an unwarranted attack upon my hon. Friend the Member for Cynon Valley (Mrs. Clwyd). My hon. Friend speaks the truth and stands by the statement that she made to the House on Wednesday on water authority matters. The water authority's position on privatisation is on record, and the right hon. Gentleman has no mandate to privatise water in Wales.
Mr. Nicholas Edwards: Further to that point of order, Mr. Speaker. I made no attack. I merely quoted from a letter addressed to me from someone who felt aggrieved by something said by the hon. Member for Cynon Valley (Mrs. Clwyd).
Mr. Speaker: I shall allow the hon. Lady one comment.
Mrs. Clwyd: It would have been courteous if the chief executive of the Welsh water authority had sent me a copy of the letter. I expect an apology because, in a conversation I had with him, he said that he could see no benefit in the privatisation of the Welsh water authority.

STATUTORY INSTRUMENTS &C.
Ordered,
That the Waste Regulation and Disposal (Authorities) Order 1985 (S.I., 1985, No. 1884) be referred to a Standing Committee on Statutory Instruments, &c.—[Mr. Durant.]

Education and Training
3.38 pm
Mr. Alan Haselhurst: I beg to move,
That this House calls for future policy towards 14 to 19 year olds to be based on a close integration of education, training and the Youth Service, taking full account of the aims and objectives of Industry Year.
I realise that terms such as education, training, and Industry Year might all be said to be "good things" in the sense that that description was used in "1066 and All That". The debate could therefore be an occasion for a well-meaning canter round the course notching up worthy platitudes and generally exhibiting care and concern. I hope that we shall do better than that. Conservative Members could indulge in a welter of congratulations on a mounting series of initiatives taken by the Government. I believe that the Government deserve congratulations on many moves which they have made in that sphere. I hope that, instead of relying purely on congratulations, we will concentrate more on looking ahead at how policy might now develop.
A great deal has happened and is happening in education and training. I should like to sharpen the focus of the argument. I shall suggest a plan and what it should entail and I shall talk about some of the problems associated with it. I want to mention the often neglected aspect of youth provision—the youth service. I have a suggestion to make about careers education which is a vital ingredient of any strategy for education and training. Then, in case the links between industry and education have not been explicit in what has gone before, I shall direct some remarks to the subject of Industry Year and its objectives.
The general thrust of the motion, in particular its reference to the integration of education and training, seems to have fairly strong backing. A great deal has been written about the way in which the policy should evolve. Even the Government, in many of their statements, seem to favour something like integration. Basically, it appears that the Government want all young people to have the opportunity to follow a more relevant and practical curriculum leading to the achievement of recognised standards of competence and qualification. I note that there are indications, perhaps pre-eminently through the technical and vocational education initiative, that this opportunity should begin at the age of 14. I also note that the youth training scheme is now intended as a permanent feature. That is made clear in the White Paper entitled "Education and Training for Young People". I most certainly welcome that development.
Apart from that White Paper, we have seen the publication of "Better Schools" and we are seeing the continued development of the technical and vocational education initiative. Discussions are taking place on the initiative of the Manpower Services Commission on non- advanced further education. We are seeing a review of vocational qualifications and the introduction of advanced supplementary levels of examination. We are seeing the certificate of pre-vocational education. We are seeing the college-employer links project, and the introduction of the general certificate of secondary education and we have also seen the introduction of information technology centres.

641
I do not believe that that is a fully comprehensive list, but it shows that the Government have been busy and imaginative in what they have been trying to create in education and training. However, one could be less polite about it. I notice that the National Association of Head Teachers is being more critical when it describes muddle and confusion as arising from all of that. Perhaps there is something of a child's puzzle about it—those children's puzzles where one is invited to follow pieces of string or lines which are in a jumble and one is never sure which leads to the end of the maze. I think that some of those dead ends now need to be reconnected so that there is more coherence in the picture.
If the House is confused by the welter of initiatives that have been taken and their varying purposes, what about the consumer? How is he to understand what the best course is for him to pursue? The Government are to be given credit for opening up a system for creating great flexibility and widening choice, but perhaps there is now a need to remould before some of the new developments that have been set in train assume their own rigidity and become harder to adapt and adjust into a coherent whole.
The plan that I would put forward, at least to set the argument going, is that we should envisage that education and training most certainly should begin at the age of 14. Basically, there would be three choices. There would be an academically oriented course; a technical and vocationally oriented course; and a workplace oriented course. But before I examine the arguments to support that proposition, I should like to make one immediate point. The National Association of Head Teachers has produced a consultative document on 14 to 18-year-olds. It comes from a working party headed by Mr. John Swallow, the headmaster of Ongar comprehensive school. I have known him for several years, and have great respect not only for what he achieves at his school but for his great knowledge of these matters. Therefore, in answer to any possible criticism from that source, I should like to say that I am not advocating a stratified system. I am looking at the plan that I have put forward very much on the horizontal plane and not on the vertical plane. Those choices should be regarded as equal.
What assumptions lie behind that plan? First, the opportunities that the plan presents should start at the age of 14. Sixteen is altogether too late. By the age of 16, alas, too many people have already opted out of the system—perhaps because they no longer pay attention or gain from classroom experience, or, more dramatic still, they may simply absent themselves from scholastic establishments. We are losing out on too many people if we think that they can be kept in full-time education, in the traditional sense, until 16. I understand that in professional circles today it is argued that 14 might be too late. I suppose that it depends on the quality of the education before that age. I believe that there must be a balance between achieving a broad foundation in education and concentrating on vocational studies.
The TVEI experience suggests that 14 is a realistic age. I note that the drop-out rate from TVEI courses is significantly less than the equivalent drop-out rate from full-time ordinary traditional education. Therefore, I believe that 14 is realistic.
642
The other assumption is that there should be no work before 18. In that regard, I am on song with the National Association of Head Teachers.
Mr. Richard Holt: Does my hon. Friend accept that rather than being hidebound to the age of 14, which can fall at any time within 12 months, the plan should start in the 14th year, at the beginning of that academic year?
Mr. Haselhurst: I recognise my hon. Friend's point. That problem bedevils the education system at many different points earlier than that. That is a detail to be worked out. I say that with no disrespect to my hon. Friend. I fully understand the importance of the point that he makes.
The other assumption is that there should be no work before 18. The National Association of Head Teachers calls that raising the preparation age of young people, which is a fair way of expressing it. We have only to look at the experience of other countries to realise that the time between the ages of 14 and 18 can be spent usefully by all people within those age groups. In Britain we under-prepare our young people for work. I wish it to become the expected norm that full-time work begins only at the age of 18.
Several imperatives are associated with such a plan, of which the first is coherence. In the motion I have used the word "integration", but, in this context, I do not believe that there is much difference in meaning between integration and coherence. Education and training should be spanned in an understandable way. What is done along the chosen route of the three that I have suggested must relate to what is happening in the other routes. The whole system should be based on a mix of education, training and work experience. The mix should vary in the different channels, but remain consistent with the established objective of increasing the amount of practical and work-based learning for those over 14 years. That implies a modular system. Sufficient work has already been done to suggest that such a system is attainable.
The second imperative must be a connection between the routes, because I do not propose three parallel or separate lines. I have referred to routes and channels, but, emphatically, I do not mean tunnels. The routes must be visible with regular cross-over points, which may interweave. Someone could start in a work-oriented course and later revert to the academic stream, followed by a mix of technical, vocational or work-based experience, depending on what is suitable for that person. Cross-over and mingling are needed because the present system is characterised by the inability of people to make second or third choices. At present there are rare opportunities to go back on a decision taken earlier in life. If one is set on the wrong route from the start, it can be the greatest of all difficulties to make the best of one's talents.
How can we realistically expect young people at the age of 14, 16 or 18 to make a decision that will affect the whole of their lives? It is possible to talk to university undergraduates today and discover that even they, with their relative advantages, are uncertain about the job or career that they want in life.
I speak from my own experience of having great uncertainty, almost up to the last minute, about which opportunity to take. I was fortunate in those days, because I had a choice of which line to take. It is hideously difficult

643
for anyone of school age in a rapidly changing world to decide what to do. We must give people every chance to be able to switch about between the different routes and channels that we can create for them. The participants in the education and training system must be able to seek more academic or more practical learning as their circumstances dictate.
A further imperative is that the nature of my proposed system should be recognised by parents. Too many parents and perhaps too many children regard non-academic work as second best. There must be parity of esteem between the various courses that could be undertaken in an integrated system. We do not want to perpetuate a system that regards 40 per cent. of our young people as failures. We can do better.
Employers must recognise what is intended in such a system and qualifications must be rationalised. The current review of vocational qualifications may provide a valuable start in that direction. Employers must understand what they are getting when young people present themselves for work. It follows that employers must have a greater input into the system and must make clearer what they expect from potential recruits.
A final imperative is that a plan for young people aged between 14 and 18 must be merely the foundation for continuing education. Education to the age of 18 or 19 is not an end in itself. It is no longer a matter of people finding one job to keep them going throughout life. They will have to renew their skills, training and education at various times. That takes us outside the motion, so I shall not pursue the point.
Mr. Peter Bruinvels: My hon. Friend has given an interesting analysis of how young people can get involved in careers after leaving school. What role does he see for careers teachers? Should not they be liaising with local industry and businesses to make sure that there is a place ready for a child who is about to leave school?
Mr. Haselhurst: I hope that my hon. Friend will forgive me if I deal with that aspect in a moment rather than break the sequence of my remarks.
Some problems will attend the sort of plan that I have put forward. Perhaps the most difficult problem that will have to be faced if we are to have an integrated policy is maintenance allowances for young people. That issue will have to be tackled. I do not see how we can perpetuate a system in which only those on youth training schemes are paid an allowance and that others are paid nothing. There is evidence that people are moving from TVEI schemes into the youth training scheme for that reason. We cannot ignore that fact.
Maintenance allowances would have obvious resource implications and all Conservative Members speak with trepidation when implying that new resources are required. However, I am not sure that vast extra sums would be required if we used a little imagination about the considerable sums already spent, directly or indirectly, on young people in this age group.
If we put all that money together and perhaps divert child benefit, in part or in whole, from the parent to the child, it may be possible to find a solution that would be broadly tolerable, cover the entire age range and remove
644
biases in the system for youngsters to consider academically-orientated, technical or vocational-oriented or workplace-oriented routes. The problem is difficult, but it will have to be faced eventually.
Vested interests will have to be tackled. It will be all too easy for teachers and employers to take a narrow traditional view and there may be tensions and jealousies between local education authorities and the Manpower Services Commission if it is felt that the MSC has moved in with more money to supplant the work of the education authority. I can only appeal for flexibility, tolerance and a willingness to co-operate among all the partners in the system. Enough has been said and done to suggest that people can and will respond if they see an emerging national need. Therefore, I am by no means without hope that everyone can co-operate in producing a viable system for the future.
There is one other problem. This may be an idiosyncratic quirk on my part, but I think that others feel the same way. If we are to bring about the extent of change that I have described, there must be leadership from the top. That might mean having a Department of State that combines education and training under one roof. I do not expect my hon. Friend the Minister to respond to that point today; it may have to be dealt with at a higher level in Government. However, I believe that that will ultimately be necessary. I am emboldened to say that because I believe that some of my colleagues also believe that it must be tackled.
I would like to see the work done by the youth service integrated into education and training. It must be truer now than in 1974—when I had the honour to introduce the Youth and Community Bill—that many young people need counselling outside the home and the school. People may regret that fact, and obviously we all hope that young people can find the support and advice that they need from their parents and homes, which can be supplemented at school. Alas, the realities of life are rather different. A growing number of young people experience difficulty in finding support and help in either of those places. Therefore, there is a role there for the youth service. I see it as a major counselling service as well as one that can help young people to find constructive leisure.
To some extent, those matters will be covered in the courses undertaken in the 14 to 19-year-old plan—for example, the work done by Project Trident and the YMCA "Training for Life" programme. There are other schemes, and I am not denigrating them by not mentioning them. Interesting work is being done in that sphere. The efforts of the youth service should be integrated into the general sytem rather more specifically and carefully than hitherto. I do not want the youth service to remain a financially poor, unco-ordinated and spasmodic service. It has struggled as a Cinderella for far too long.
I hope that in making remarks about career structure and education I shall respond to the point made by my hon. Friend the Member for Leicester, East (Mr. Bruinvels). There must be a quantum increase in careers education, and it must go further down the school system. The current volume is not sufficient to provide an effective service, and I do not believe that that service is currently as efficient as it should be. We should consider a new, combined, independent service merging careers teaching — which is under-funded — with the careers advisory service. I do not see why someone should not be employed in a school by a new centralised careers service. That

645
person would spend most of his time in that school providing careers education and advice for the pupils and, perhaps, help on other courses that come within his ambit. He would have responsibility for liaising with industry to ensure that opportunities are created that match the product of the various courses in his district. That would be a useful way forward, and I commend it to the House.
Included in my motion is a reference to Industry Year. There has, of course, been a full and interesting debate on that during private Members' time, initiated by my hon. Friend the Member for Birmingham, Northfield (Mr. King). I do not want to cover the same ground today, but it is an objective — some say the most important objective—of Industry Year to improve understanding between education and industry. I hope that that objective has been largely assumed in much of what I have already said. There is an opportunity today, however, to stress that each needs the other. Industry is vitally concerned with what happens in education and training, while education and training need to rely heavily on industry to provide a decent service for the pupils and trainees.
Industry needs to be not only the provider but a great source of influence on our education and training system. It can help to bring education alive so that it is no longer drab, dull and apparently irrelevant. There is a great deal of evidence that teachers can gain from experience within industry. Many of our major companies, at their own expense, have undertaken schemes to ensure the translation of their people into schools and teachers into their companies. Those who have already experienced that say that it has been of great benefit.
Such useful initiatives, whether from the CBI or individual companies, have helped to forge better understanding. However, the coverage is far from universal. The CBI states that its "Understanding British Industry" scheme covers only about 5 per cent. of our teaching force. The CBI's aim during Industry Year is to improve that coverage to about 40 per cent.—but even then we shall still be very much behind the sort of standards that we should achieve.
What more can be done? If there is an integration of much of our education and training, that must mean a greater contribution from industry. The MSC is due all credit for helping employers and trade unions to understand that point. Perhaps we should take up a point in a report published only today by the eastern region of the CBI which suggests that more business men should be governors of schools. That is something that we have not previously considered sufficiently.
I wonder whether we would encourage the further involvement of industry by giving a little financial inducement. There will be no difficulty in encouraging the ICIs, BPs and IBMs of this world to do valuable work; it is the smaller companies that wonder whether they have the time to make the necessary contribution. Perhaps such efforts—which can be quantified where business men are giving their or their employees' time to help the development of training and education off their premises—should be tax deductible. We would quickly regain any such concession in the quality of trainee and pupil emerging from the system.
Mr. Peter Bruinvels: I am sorry to take up my hon. Friend's time. Is he aware that one of the leading
646
community colleges in Leicester, Judgemeadow, funds a large number of projects through the local authority and local businesses, whose representatives serve on the board of governors? Teachers and pupils have the opportunity to try out computers and machine tools. That initiative is working in Leicester.
Mr. Haselhurst: I am grateful to my hon. Friend. Many firms have been extremely generous and far-sighted. The volume of activity will increase, but it must increase quickly. We do not wish to be struggling in another 10 years and to have reached only 60 or 70 per cent. of the teaching force in Britain. I suggested that the expense of this activity could be tax-deductible because it could hurry the process along. I am not implying that, without such a concession, firms would not do what was right both in their interests and in the national interests.
Mr. Holt: On the question of available resources, has my hon. Friend given consideration to the many employers who have expensive capital equipment which technical colleges and other places of education simply cannot match in terms of resources? In the industry in which I worked we had machinery of which no trainee would have had any experience in the formal educational sense other than through the company. The company had down time on the machinery when it was not producing. The technical colleges will not be able to train the people who are required unless there is some financial inducement.
Mr. Haselhurst: My hon. Friend makes a valid point which may be allied to what I have said. I do not want to go into the question of the availability of equipment and hardware, although it does present a problem. It may be that the hardware is scattered too far and wide—that which is available in technical colleges and that which is available only within the premises of employers. More thought must be given to how we can make equipment more accessible to more people.
However clear may be the pattern of education and training in the future, and however much we commend individuals, the Manpower Services Commission, companies and teachers, we need the help of the Government. This Government, I believe sincerely, have shown that their heart is in the right place. [Laughter.] It is all very well for the hon. Member for Newcastle-under-Lyme (Mr. Golding) to laugh. Obviously, he wishes to discount and discredit all that has been done. That is most unfair and unreasonable.
Some of the Government initiatives have been taken a little late in the Government's life. I would have preferred some of them to have been started immediately the Government came to office. However, I will not knock what the Government are doing now. The hon. Gentleman should recognise that the value of these initiatives is recognised in all sections of industry. It is not a matter for silly denigrating laughter. The hon. Gentleman should know better.
Mr. Barry Sheerman: Surely the hon. Gentleman will be sympathetic to a degree of cynicism from these Benches? Most of the so-called progress that has taken place over the past six years has come about because there are 4 million unemployed, 1¼ million of whom are young people. That is why the Government are instituting most of these reforms.
Mr. Haselhurst: I did not especially want to inject a note of controversy into this afternoon's proceedings. I

647
thought that the concepts which I put forward would be treated on their merits and sympathetically throughout the House-give a little there and take a little here.
If the hon. Member for Huddersfield (Mr. Sheerman) makes a jibe about this Government reacting for the wrong motives—the increase in unemployment—one can point to the last Labour Government when we had mounting unemployment, though below what we have experienced recently. The Labour Government did not lift a finger to do anything when many believed that action should be taken. There was not much support on the Opposition Benches for the Youth and Community Bill. The Labour Government had five years to take action but they did nothing.
Dr. Keith HampsonMy hon. Friend may recall the memoirs of the then Chief Secretary, Lord Barnett. In them he gave a blow-by-blow account of how Mrs. Williams went to the Cabinet with a scheme similar to the youth training scheme. The Chancellor of the Exchequer and other leading figures in the then Labour Government whittled the scheme away and the pilot scheme was given only £7 million. That was all Mrs. Williams got.
Mr. Haselhurst: My hon. Friend obviously has a stronger stomach than me for the memoirs of former Labour Ministers, but he has made a useful point.
I believe that there have been several good beginnings, and they have received widespread backing and much political good will, despite the laughter of the hon. Member for Newcastle-under-Lyme. If I may change the metaphor slightly, it seems that almost all the pieces of the jigsaw are now on the table and it is not unreasonable to call on the Government to start fitting the pieces together. If the Government do so, we can then offer a new and recognisable deal to young people. We must create new opportunities in industry in Britain to put it on a par, in terms of its most important raw material, human beings, with other nations with which it must compete. If the Government act, they will give fresh encouragement to the teaching profession after the present difficult dispute has been brought to an end. The Government must show that they have the will and determination to complete what they have begun. I believe that the moment for that has come.
4.16 pm
The Minister of State, Department of Education and Science (Mr. Chris Patten): I begin by congratulating my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) twice over. First, I congratulate him on his success in the ballot and, secondly, I congratulate him on his use of that success. My hon. Friend knows more about this subject than most of us. He has proved that to us this afternoon, not least with his encyclopaedic knowledge of the rather Orwellian acronyms that litter the education and training landscape. My hon. Friend has been years ahead in calling for the close integration of education and training in the youth service. I hope I shall be able to show my hon. Friend that we are at least beginning to catch him up.
I start with three propositions on which I think I will carry even Opposition Members. First, it is clear that there has been substantial historic concern about the relationship between education and training. If my hon. Friend the Member for Cambridge (Mr. Rhodes James) were here this
648
afternoon he would confirm that Prince Albert himself would have waxed indignantly about the technician gap. That concern has been sharpened by high unemployment and the pace of technological change. These two factors have meant that for most young people entry into the job market has been delayed for a couple of years. For most young people it has become crystal clear that a permanent, once-and-for-all plunge into the job market, with no training after the age of 16, offers a questionable future.
The second proposition is that we have failed, because of the absurd and debilitating polarisation between so-called academic learning and so-called vocational learning, to bring together education and training.
We need general education courses which are also practical and relevant, and we need vocational courses which include those elements of general education necessary to foster the qualities which employers say that they want. It seems ridiculous to suggest that anybody who ever emphasises the importance of general education is an effete, wishy-washy, dare I say wet, descendant of Dr. Arnold, and personally accountable for the decline of the British industrial spirit. It is equally ridiculous to suggest that anybody who talks about the importance of relevance in education is a utilitarian, uncouth and uncivilised descendant of Mr. Gradgrind.
In a remarkable book on the philosophy of education written a few years ago, Mary Warnock argued that education should be regarded as a preparation for the good life and that, for most people, the good life should include work, and that education had to take account of that. I endorse that point of view, although I would not necessarily want to associate Mary Warnock with Dr. Arnold or with Mr. Gradgrind.
The third proposition is that it is in the interests of education and of industry to know more about each other, but it is rather depressing that a nation with a history such as ours needs Industry Year, but there it is. I hope, nevertheless, that Industry Year is a substantial success and that it helps education and industry to break out of the vicious circle in which both sides undervalue the other's work.
When addressing the curricular and institutional problems of education and training, we are dealing mostly with what happens after 16, but what happens before is vital. My hon. Friend understandably mentioned the age of 14 as a starting point in his motion. If we get right what happens between five and 16, and the curriculum is, according to the famous quartet, broad, balanced, relevant and differentiated, and if we are able to raise the threshold of achievement for those of average ability and those of below average ability, the problems after 16 are much easier to deal with.
I do not want today to engage in another argument about the teachers' dispute, which we have managed to discuss several times recently. However, I should like to make it clear once again that I wholly take the point that, unless we have a better trained, more highly motivated and better paid teaching force with clear conditions of service, our other ambitions for education before and after 16 are as dust in the wind.
I have mentioned the importance of balance. The technical and vocational education initiative is clearly relevant in that regard. As my hon. Friend will know, it is an initiative in which we are investing about £220 million of taxpayers' money. It should help to increase liaison between industry and education. I understand that

649
my hon. Friend the Parliamentary Under-Secretary of State for Employment will want to say a little more about that if he catches your eye, Mr. Deputy Speaker. We are considering carefully the wider application to all secondary schools of the lessons that we have learnt from the pilot TVEI projects.
As for breadth and balance, what young people are taught and how they are trained should not be determined, let alone narrowed, by examinations. Examinations should be the servant and not the master of the curriculum. Young people should be well advised about the routes rather than the tunnels that they take through the education and training system, and they should be able to transfer from one route to another according to their abilities or ambitions. It is in that spirit that the Government have acted to reform national exams at 16-plus, 17-plus and 18-plus, starting at 16-plus with the general certificate of secondary education.
The GCSE is one of the most important education reforms since the war. It has been discussed for at least 15 years. Nobody can legitimately argue that progress has been exactly helter-skelter. The examination puts greater emphasis on practical skills and application as well as on knowledge and understanding. I believe that it will do much to prepare young people better for adult and working life. It should motivate and engage pupils to achieve more. It seems to provide a better and fairer way in which to assess pupils at the end of the compulsory period of schooling and a means of establishing a sound basis for all post-16 education and training, including the youth training scheme, the certificate of pre-vocational education, A-levels, and full-time vocational courses.
The preparations for the GCSE are quite literally unprecedented. Most have gone according to plan, and some have gone slightly ahead of plan. I do not doubt that the timetable is extremely tight or that the task of introducing the exam is tough and puts additional demands on secondary school teachers. The timetable has always been tight and the job of introducing the exam has always been tough. But nothing that has happened in the past year or so has made the timetable any tighter or the task any tougher.
Teaching the new syllabuses will start this autumn and the examination will be sat for the first time in the summer of 1988. Retreat from that timetable is not an option. We cannot put into reverse the preparations that have been made so far and then start up again 12 months later.
I hope that we shall have the opportunity to discuss the GCSE at some stage. We shall of course listen sympathetically to any suggestions, whether they come from examining groups, employers, or teacher unions, about how we might add to the preparations that have already been made and help smooth the introduction of this important examination. We are prepared to listen sympathetically to any proposals. We are not prepared, however, to abandon the examination and to preside over what I believe would be an absolutely chaotic retreat.
Mr. Jack Thompson: Has the Minister had correspondence from teachers who are responsible for introducing the new GCSE? Only last week, I had correspondence from representatives of the whole of the
650
north of England saying that there is little likelihood of the examination being introduced in September because there is already chaos in schools regarding examinations.
Mr. Patten: I have had a good deal of correspondence on the subject. I am in the process of meeting all of the examining groups to discuss it and I have talked to several of the teacher unions, and will continue to do so. There will be chaos only if some of the teacher unions determine that there will be chaos. I do not believe that, in the wake of what we all hope will be a satisfactory settlement under the auspices of ACAS, any responsible secondary teacher, given the help that we are providing with training and our willingness to consider other means of helping, will set out to wreck what all of the teacher unions and everyone else recognise is the most important educational advance for pupils of this age for years.
The House knows that we are anxious that the pattern of education for A-level students is too narrow, especially as compared with provision in competitor industrial countries. We must aim for a broader more balanced education for those following A-level courses, whether into higher education or employment. The House will know that we are introducing AS-level examinations in 1989. A-levels will remain, as they set standards of excellence which should be preserved. Nevertheless, some reforms are necessary, for example, in establishing criteria for key A-level grades.
There are also interesting developments in individual subjects, such as London's design and technology syllabus, which includes a module on computer-aided engineering, and the Joint Matriculation Board's new common syllabus on foreign languages which puts a great deal more emphasis on practical language skills.
Outside the GCSE and A-level, but with links to them, we have taken two major initiatives in qualifications for 16 to 19-year-olds. We have introduced a certificate of pre-vocational education, which is a new qualification for young people of school-leaving age who do not aspire to A-levels or a specifically vocational path, but who wish to remain in full-time education, whether at further education colleges or in schools. It provides a broad course based on general education with a vocational slant. This year may not have been ideal to start such a new syllabus, but about 15,000 pupils have been taking the CPVE course in more than 1,000 schools and further educational colleges. I hope that next year the takeup will be greater. The takeup will be helped if we can do more to publicise this extremely important new course.
The second, and arguably more important, initiative has been our attempt to cut a path through the jungle of vocational qualifications. That is what the review of vocational qualifications under the admirable chairmanship of Mr. Oscar de Ville seeks to do. It will be completed in April, and we look forward to considering its recommendations as soon thereafter as possible.
I am confident that we can build on existing strengths to develop a system of qualifications which is more attractive, relevant and accessible to young people and employers, while defining and maintaining the highest and clearest standards. We need to encourage more and better vocational education and training to produce competent, adaptable and creative individuals that our society and economy obviously need.
Mr. Holt: I wish to refer to the quantum of foreign language teaching and training, although I recognise that

651
the debate is about training, industry and education. In reply to a recent question I was told that less than 2 per cent. of schools offered Russian or Japanese, and that only two schools offered those subjects in the whole of Scotland. How will we compete, and what resources will the Minister put on the table?
Mr. Patten: One of the themes in our White Paper "Better Schools" was that we needed to broaden the curriculum, and I accept that. It is invidious to choose between one subject and another. Although I recognise the importance of encouraging Japanese teaching and the study of Japanese in our schools, I have recently concentrated more on the importance of physics and mathematics, and on developing consensus about teaching the English language. I have read some documents about teaching the English language in our schools and find them almost incomprehensible. That should be a high priority, although I accept what my hon. Friend says about the importance of ensuring that we produce people who can sell vast quantities of cars to Japan and the Soviet Union.
Mr. Clement Freud: Will the Minister tell us what sort of cars we would sell to the Japanese?
Mr. Patten: Those which are described as British.
Mr. John Golding: The Minister is blushing. I have never seen a Minister blush before.
Mr. Patten: That is not a blush, but blood pressure. It becomes increasingly difficult to know what one is driving. I have a Morris Minor which is regarded as British, and also a Vauxhall Cavalier, but I am not sure how hon. Gentlemen would describe that.
Better careers guidance is important, not least because if young people make the wrong decision at 15 or 16 it is personally damaging for them, and costly for society. Once young people have made that choice, they should not reckon that future options are constrained by anything other than their determination and ability. Therefore, we need a much wider recognition of the already well-developed route to higher education through vocational qualifications.
Local education authorities must plan provision for 16 to 19-year-olds much more coherently than at present. The distinction between further education colleges and schools has to some extent been blurred, first by the long and, I am pleased to say, sustained tradition in further education colleges of general education, and secondly by the advent of the new sixth former in our schools. Those factors provide reasons for more coherent planning throughout the further education sector and schools.
Two further factors are vital. The first is demography over which, happily, politicians have little influence, except personally. The number of young people in the 16 to 19 age group will fall like a stone at the end of this decade, and in 1993 the number of 16-year-olds, for example, will be about one third lower than the number at the peak in 1981. Secondly, although numbers will fall, I am convinced that the participation rate of young people in education and training will continue to rise even if, as we hope, youth unemployment falls. Young people recognise increasingly that within the job markets of the future those who do not have qualifications will be desperately disadvantaged.
Dr. Hampson: People in Leeds may become worried that my hon. Friend is giving carte blanche to tertiary education. The Labour-controlled council has without consulting headmasters put forward an expensive scheme for the entire city to move from sixth forms to tertiary centres even though many schools, admittedly not necessarily throughout the city, have extremely good sixth forms.
Mr. Patten: I am certainly not giving carte blanche support to anything of the sort. However, local education authorities will have to plan provision across the age range in a way which is educationally sound and cost effective. I have seen various different ways of doing that throughout the country, and the last thing that I wish to do is to impose one solution on the whole country. Without reawakening old controversies, we have been down that path before, and it was not noticeably successful.
To consolidate and improve further education we clearly need to strenthen the partnership between colleges and employers. At present there is no lack of goodwill. Ways of improving the responsiveness of colleges to employers' needs are being explored, for example, through the colleges and employers link project. I have been very impressed by the work of further education colleges in the past four or five months. The colleges are well aware of the importance of better marketing for their courses and of the importance of more flexibility and efficiency in providing the sort of courses that local employers want. The most common complaint I hear is that many employers do not know what they want and that some employers still give insufficient priority to education and training, which I believe is one of the reasons for our economic problems.
The Manpower Services Commission has quite properly been at the forefront in trying to persuade employers that investment in training really is what it says, and is not a dead-weight cost. In particular, in planning work-related, non-advanced further education, the MSC has been able to focus local employers' attention on the opportunities available in local colleges. By acting as a proxy for local employers, the MSC has been able to help colleges respond to the demand from local employers.
My hon. Friend the Member for Saffron Walden was right to refer to the youth service. I would say more about the youth service if I had time, but I want to allow other hon. Member to speak. The youth service has been particularly concerned, over the past few years, with the problems of youth unemployment, particulary in the inner city areas, and with the problems of those who are virtually alienated from formal education. My hon. Friend will know that the National Advisory Council for the Youth Service met for the first time last month. He will not be surprised to know that the council expressed its interest and concern about education and training, and we look forward to hearing more from the council as it gets under way.
In conclusion, I express once again my gratitude to my hon. Friend the Member for Saffron Walden for the spirited and thoughtful way in which he introduced the debate. I hope that the debate will help us to break down some of the rigid distinctions that still exist between education and training. I see the work of the education service being complemented by the expertise of employers and training agencies. We should all regard ourselves as being on the same side. We have a considerable job to do

653
if we are not to betray the hopes of a whole generation and if we are not to fall further behind what other countries do in this most important area.
I trust that I have provided my hon. Friend with sufficient evidence to demonstrate that we have set our hand to this extremely important task and that, to follow what my hon. Friend said, we are not just talking but actually doing something about the problem. I would not like to indulge in what Lord Palmerston called the "abuse of metaphor", but I think that we are putting together some of the pieces of the jigsaw.
4.44 pm
Mr. Barry Sheerman: I add my congratulations to the hon. Member for Saffron Walden (Mr. Haselhurst) on initiating this debate and on choosing a subject which is not discussed enough in the Chamber and which should be taken extremely seriously. I agree with much of what the hon. Gentleman said. Many of his suggestions were both positive and creative. Indeed, many of them could have come from the Labour party manifesto.
However, it emerges from occasions like this—we have had a civilsed debate so far—that there are two faces of Conservatism. One face runs the engine of the Government and the other is a more civilised face which appears in debates like this. It may be that we shall hear a different tone in other speeches, but a visitor from education, in witnessing this debate, would be forgiven for having a feeling of slight unreality.
There have been two speeches from the Conservative Benches which hardly made any mention of the fact that education and training are at a lower ebb than at probably any time since the Education Act 1944. No mention has been made of the longest running dispute in the education service that is harming families, parents and the morale of the teaching profession. Also, the Government have destroyed the traditional training mechanisms. Many of them were imperfect, but at least they existed to train people. I refer to the industrial training boards, skillcentres and, in particular, the apprenticeship system. A visitor from outside would be forgiven for thinking, "What on earth has been going on in the past six years when all that has been ignored in the remarks so far?"
I must bring the House back to a sense of reality. The morale of the teaching profession is lower than it has ever been since 1944. The reason is not simply that teachers deserve better pay. I do not have to descend into the realms of theory. The fact is that teachers of certain subjects are not coming forward. The hon. Member for Langbaurgh (Mr. Holt) mentioned the lack of training in Japanese and Russian. I was reminded by the hon. Gentleman's comments — if we are serious about the future of industry—about the lack of candidates coming forward for the vital jobs in science, technology, applied electronics, robotics and computer studies. I have visited schools up and down the country which are crying out for help, because they do not have the ability to attract men and women qualified in those subjects to teach our young men and women because teachers' pay is not good enough.
I have just returned from a visit to Stevenage. I was told that a school there could not even hope to recruit someone, even if the candidate was given a house in the area for a two or three-year free period, because that person would not be able to afford to rent or buy a house in that area on
654
a teacher's salary. Such a candidate would be forced to go into industry, where computer and electronics companies pay half and even twice as much again.
Mr. Chris Patten: Will the hon. Gentleman give the House the benefit of his thoughts on the fact that average salaries for teachers in real terms when the Labour Government left office were £800 lower than they are today?
Mr. Sheerman: I shall return to that point later in my speech. However, I challenge the Minister's figures. I read the Minister's press release and checked his figures. I think they are completely wrong, and the teaching unions agree with me.
Mr. Patten: I bet they do.
Mr. Sheerman: Indeed they do.
Again, the Minister is deriding the teaching profession. Since I have been in the House, all I have heard from the Government has been an attack on teachers. I have mentioned teachers' pay, which does not produce teachers qualified in the right subjects at the right time and in the right place. It is a question not just of money, but of morale.
Time and again the Secretary of State for Education and Science has attacked teachers for being poor teachers, not committed to education or to the future and welfare of their pupils. That is wrong. Such attacks undermine the profession and are at the heart of the current dispute. If the Government had anything other than a desire to continue the dispute, the teachers' unions would have settled long ago. I am sure that they would have done so if the Government had governed and that had been seen to be their role.
I want to consider some of the positive aspects in the motion. Many of the things that the hon. Member for Saffron Walden mentioned are things to which the Labour party is already committed. However, when he talked about integration and coherence, he certainly touched on a subject to which so many professionals in the education world would say, "Hear, hear."
The pursuit of coherence is important to the National Association of Head Teachers, to which the hon. Member for Saffron Walden referred on several occasions. The hon. Gentleman went through the list of acronyms. He referred to TVEI, CPVE, and a host of other schemes. I hope that Conservative Members will recognise that new demands are being placed on teachers when their morale is at an all-time low.
It is not easy for teachers in the modern world, when the Government introduce many new schemes, to know that a high percentage of the young men and women in the classroom will not automatically go into employment when they leave school, as so many did in my generation. The effect of unemployment is to be seen in the schools. It has led to low morale among pupils, and their motivation has suffered. The Government have underestimated the consequences.
In a climate of massive unemployment, there are many areas where most average youngsters have no chance of obtaining a job on leaving school. In the north-west, 22·7 per cent. of youngsters at school stay on after 16 years. In the south, and in Greater London, 35·3 per cent. stay on after 16. What is the destination of young men and women who have been on the youth training scheme? In the

655
northern region, 41·5 per cent. of those who complete a youth training scheme join the dole queue, compared with 15·3 per cent. in the south-east. The education and training situation is desperate. Many young people throughout the country are in a state of despair. That is the real context for this debate.
The hon. Member for Saffron Walden asked, "Is 14 years too late?" I believe it is. I accept that many international observers think that our primary schools are extremely good, but, unfortunately, something goes wrong when our bright young people leave their primary schools and move into secondary education. It seems that they are turned off education. Indeed, it seems that they themselves are turned off as well. I am sometimes left in despair when I talk to youngsters. It seems that some of them have lost hope in their country, in industry, in their communities and in themselves. They have lost self-respect and self-regard while at school. Those of us who are interested in Britain's future must, irrespective of party, ascertain the causes for this despair.
Mr. Tony Baldry rose—
Mr. Sheerman: I shall not give way now.
Something happens to our young people when they embark on secondary education. We must identify what it is and produce remedies.
The hon. Member for Saffron Walden was right when he said that youngsters with no qualifications no longer move directly into work. He rightly said that they do not move into work in many instances before they are 18. Whether the fact that there is little work for young men and women before they are 18 is a consequence of Government policy or whether it is the consequence of mounting mass youth unemployment is a question that I shall leave others to answer. I invite others to draw their own conclusions from my earlier remarks.
When the Minister had only recently taken on his new education brief, he made a speech in which he referred to young people having a wide and real choice at 16 years of age. The hon. Member for Saffron Walden put his finger on reality when he said that if real choice is to exist, a system of education maintenance allowances should be introduced as soon as possible. Unfortunately, many young people do not have a choice. They have to take part in a youth training scheme, and thereafter they have to try to find a job.
The position of many families forces youngsters to turn off the career path that would be best for them—for example, further education at a college or staying on at school. Tens of thousands of young people are having to forgo what is right for them because they need to take a small wage home to their families. In other words, they no longer have a choice. I hope that the Minister is serious when he makes speeches throughout the country on these issues. I hope also that within the Department he will argue for real choice for youngsters.
The Labour party believes in many of the principles and concepts which are espoused by the hon. Member for Saffron Walden. They are set out in manifestos and policy documents and are ready for implementation after the next general election, which seems to be more imminent as each day passes.
We believe that there is a balance between a good general education and an ability to receive an education in technical and vocational subjects or, as the hon. Member
656
for Saffron Walden said, in practical subjects. A balance between academic, technical and vocational subjects and the workplace is a good description of a proper comprehensive education. Conservative Members have not always espoused comprehensive education, but I am delighted to hear that some of them are now accepting the proposition.
The hon. Member for Saffron Walden talked about real choice and the possibility of young men and women changing course as their careers developed, and he drew a distinction between routes and tunnels. An awful tunnel that blights our industrial and educational lives is one that stems from a percentage of the privileged opting for a different tunnel from the majority, which leads them away from the state sector—
Mr. J. F. Pawsey: Is the hon. Gentleman referring to Winchester?
Mr. Sheerman: My hon. Friend the Member for Stoke-on-Trent, Central (Mr. Fisher) is not responsible for where his parents sent him for his education. He has learnt the lesson and sent his children through the state education system. In discussing routes and tunnels, private public school education is the tunnel, and it is a blight on the education of our young men and women. It is more responsible for our poor performance in industry and in technical education than almost anything else.
The youth service has a growing importance in our society. There are about 1·25 million unemployed young men and women, and they need and deserve a better youth service than the one that was appropriate for the 1950s and 1960s. If local authorities and the Government choose to ignore that, they are living in cloud-cuckoo-land. A properly manned and resourced youth service would be a tremendous help in bringing some counsel and help to young people who are unemployed and in despair.
The Government rejected the main findings of the Thompson report, which were based on experience and participation. The rejection of putting real money into our youth service and taking it seriously has had a damaging effect on our young people. The way that the youth service has been used over the past five years has led to many missed opportunities.
I should have thought that last year, International Youth Year, would have been an opportunity to introduce a properly resourced youth service. There are many models. The Wolverhampton youth service is an example where Labour authorities are showing what can be done, even on a reduced budget.
Mr. Geoff Lawler: As the hon. Gentleman will be aware, a report on the funding of the youth service was recently published. One of its main findings was that 92 authorities were not spending up to their estimated expenditure on the youth service, but were diverting about £13 million into other services. Many of the most serious offenders were Labour-controlled authorities. When it comes to the allocation of funds for voluntary services, where there is a more effective use of resources, as I am sure the hon. Gentleman will agree, the most serious offenders were again Labour-controlled authorities.
Mr. Sheerman: That is a good point, but I remind the hon. Gentleman that the figures show a mix of Labour and Conservative-controlled authorities. However, when local

657
authorities, Labour-controlled in particular, are squeezed of resources by the Government, it is not surprising that sometimes their priorities for employment, regeneration and other activities have to be given precedence over the youth service. We must have some youth service resources particularly earmarked for that purpose. That is the way that we shall go when we form a Government.
If we are to be honest with millions of young people, we must debate the youth training scheme tonight. It is at a critical point. It is about to go into its extended two-year form. As the Government and Ministers know, the Opposition broadly support the extention of YTS to two years, because that is a step on the road to Labour's long-stated objective in "Learning for Life", published in 1981, and in other documents, towards a proper two-year traineeship for all young people. Trainers, educationists, and employers who are trying to make these schemes work deserve our help, encouragement and congratulations. We also support the closer regulation of managing agents and the work being done on the accreditation of YTS.
There is truth and fiction in this matter. The Prime Minister is fond of talking about truth and fiction and about how much stranger truth is than fiction, so I shall develop that theme. The truth is that those working valiantly in YTS are shackled in their efforts by the effects of five fictions.
The first fiction is that the Government have made extra resources available for the two-year YTS. The truth is that no more will be spent on the two-year programme when fully operational than the £1 billion promised in 1983 for the one-year scheme. That is training on the cheap, and the result is catastrophic. There is inadequate off-the-job training—only 20 weeks over the two-year period, when the TUC and educators wanted 26 weeks. It means overall lower training qualities than we need and want. It also means a great shortfall in the premium places and an allowance that is too low, by anyone's reckoning, by about £500 a year for each trainee.
The second fiction is that the Government have created in YTS a high-quality skills training programme. At one time, Lord Young wanted to call it the skills training programme rather than the youth training scheme. The truth is that most YTS places are fairly low-quality work experience. We must move on from that, but we cannot do it without cash. It is also true that high-quality apprenticeship type training has been halved since 1979. The new funding arrangements will force many YTS employers to hire out their trainees on the cheap to get the income to make up for the funding deficiencies. That is a recipe for the exploitation and alienation of our young people.
The third fiction is that the new premium places are a proper successor to the mode B schemes—the generally high-quality schemes aimed particularly at disadvantaged youngsters. The truth is that the two-year YTS makes the premium places a ghetto for the disadvantaged. Trainees will have to be vetted first by the careers service. We understand that after 1 April disadvantaged youngsters with a handicap, whether they come from a history of trouble in the courts or of absenteeism in the schools, will have to be on special schemes on their own. They will not be integrated with their peers, but will be in ghettos for the disadvantaged. That is wrong. I hope that if I am wrong, the Minister will clear up that point later.
658
The effects on the career service will be bad. Members of the executive of the Institute of Careers Officers came to see me about this. They are extremely worried. They feel that the scheme will turn our education and youth training schemes into ghettos for such young people. The careers service is—
Mr. Holt rose—
Mr. Sheerman: The hon. Gentleman will have an opportunity to make his own speech.
The careers service is terribly overstretched. I understand that a previous Minister in the Department of Employment seriously considered abolishing the careers service. Thank heaven, that lunacy was avoided. The careers service needs to be expanded and better resourced soon. I am sure that the hon. Member for Saffron Walden will agree with me on that. The reduction of places on mode B schemes has led to the reality that 70,000 places have slipped to 40,000, and new funding arrangements are driving schemes out of operation. Others are being forced into unsuitable survival mergers, and experienced trainers are being forced on to the dole.
Mr. Holt rose—
Mr. Sheerman: I shall not give way.
When the previous reduction from 90,000 to 70,000 was announced, there were assurances that that would be the bottom line.
The fourth fiction that the Government are putting about is that there are jobs and a great future at the end of YTS. That is not so. One cannot build an education and training policy in an environment of mass unemployment for young people. Some 100,000 trainees a year—30 per cent.—graduate straight on to the dole. In all, 1·25 million young people are on the dole and 500,000 have been unemployed for more than six months. Unemployment in the economy as a whole is increasing year after year under a Government who have run out of ideas, out of steam and very nearly out of Ministers.
I hope that the Minister will listen particularly to this item. The Government are failing, in particular, YTS entrants from April to September 1985. They cannot look to the two-year YTS, but they also cannot look to the late, unlamented, young workers scheme, which bribed employers by allowing them to give low wages to young people. That section will get nothing by way of help into employment. Those entrants will be more disadvantaged in seeking employment than any other group over the past 10 years.
The last fiction is the richest of all. It is the fiction that is in some ways the most hurtful to many young men and women on YTS. I spoke to some of them last week. It is surprising that the Manpower Services Commission should be so out of touch that it decided that models and actors should be hired to pose as YTS trainees in the £4 million advertising campaign.
Mr. Chris Patten: That is a trivial point.
Mr. Sheerman: The Minister says it is a trivial point. That shows how completely out of touch he is with young people aged 16 and 17. Many of them are bitter and angry. Instead of taking some of the 350,000 YTS trainees and using them for the advertisement, Saatchi and Saatchi hired models. Fifteen-year-old Tracy Logan is not a YTS trainee. It is not for her, she says. She was also paid more for an hour's work than a YTS trainee gets in a week. It

659
was a disgrace, but what else could one expect from an advertising agency, such as Saatchi and Saatchi, which is so closely linked to the Conservative party?
Mr. Pawsey: The hon. Gentleman is scraping the bottom of the barrel.
Mr. Sheerman: The House will remember that during the 1979 general election campaign the Conservative party said "Labour is not working." Saatchi and Saatchi showed people queueing up for jobs. But it did not find unemployed people and pay them to do the job; it got actors and members of the staff of Saatchi and Saatchi to do it. Surely that could have been avoided. It was an insult to the YTS trainees. For an hour's work, Tracy Logan was paid as much as YTS trainees get in a week.
Education and training in this country are at a critical point. YTS, the expansion and development of the curriculum and the changing nature of further education are in the melting pot. The adversity of high unemployment provides us with the opportunity to make urgently needed changes. This opportunity is unparalleled since the introduction nearly 100 years ago of universal schooling. We could be laying the foundations for a wonderful work force in the 21st century. This is Industry Year. However, for unemployed young people as well as for other unemployed people in this country the idea that we are tackling this problem must not turn out to be a fiction. The advertising agencies must not put out the fiction that Industry Year is wonderful and will be the answer to all the problems of unemployment. It must be more than that.
Education and training must do something about getting this country back to work again. None of the policies mentioned by the hon. Member for Saffron Walden or by the Minister of State will work unless there are jobs. Jobs come first. I hope that there will be a real commitment to backing British industry, British Leyland and other British companies and to allowing local authorities to spend money, thereby creating work.
I hope that the Government will see the folly of their ways and that Ministers will say in this debate that they take on board the unanimous, all-party recommendations on long-term unemployment that were made last week by the Select Committee on Employment. Measures that would relieve long-term unemployment would have a knock-on effect upon teachers and pupils. If the morale of those who work in the system can be lifted, there will be some hope for education and training in this country.
5.14 pm
Mr. Robert Banks: I join in congratulating my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) upon using his success in the ballot to raise this extremely important subject.
I listened with great care to the hon. Member for Huddersfield (Mr. Sheerman). He attacked the public school system but there has been no confirmation from the Opposition Front Bench that the policy of the Labour party is to destroy the public school system, which would lead to chaos in the teaching profession. The hon. Gentleman then attacked the youth training scheme without saying a single word about the Labour party's policy on replacing YTS, which is under such critical fire.
This debate should deal with the constructive efforts that can be made to deal with the problems that exist in
660
our society and should concentrate upon the direction which education ought to take during the last quarter of this century. We could spend the whole evening griping about this, that or the other, or griping about the problems caused by the teachers' strike, but it is far more important for the House to direct its thoughts to how best to achieve this country's objectives through our education system being geared to the needs and requirements of our changing society.
Unemployment will be a major factor until the end of this century, and probably beyond it. Unemployment is not a problem for this country alone. It affects Europe and other nations. However, unemployment places a huge responsibility upon education to try to solve the problem of unemployment.
The pattern of our society is changing. People's working lives will be shorter. They will not start work at 18 and continue in work until they are 65. That philosophy will not see us through to the end of this centurty. Young people must be educated to recognise that there will be a change in the pattern of their working lives. They must also be educated to use their leisure time. With a shorter working life, people will have much more leisure. Furthermore, during their working lives people will have an increasing amount of leisure. That is good, but we must ensure that they are able to enjoy themselves both while they are working and after they have retired. Education must ensure that people are educated to use their leisure time productively. In the 1960s it was normal to have two weeks of holiday each year. That has been increased to between five and six weeks a year. By the end of the century it will have increased considerably beyond that.
I pay tribute to the way in which the teaching profession has helped young people to understand the kind of careers that are available to them. It has instilled in them the desire to be enterprising and to be the "doers" of this world. That is a broad statement. However, the teaching profession has provided this country with a generation of young people who are every bit as good as any previous generation. They are probably better than any previous generation. I am speaking almost like an old man who is looking at the generation that will take over from us. The young people of today have an immense fund of talent. That is due to their education in the last few decades. A great deal more must be done. Many have not had the education to give them the tools to provide them with a job. People are still coming out of schools unable to read or write properly. We must recognise that and take steps to improve it.
The technological revolution that is taking place creates many challenges. There is a shift in emphasis towards the high-tech industries in the United States, Japan and South Korea. How are we to grapple with the problems that will emerge from the growth of those industries in those countries which are taking the markets that we must prepare ourselves to obtain? We can do that only by being a fully-fledged member of Europe, working in concert with our European partners. To do that we must provide the scientists, technicians and engineers to generate those industries, not just in Britain but in Europe.
Therefore, it is of immense importance that we give the fullest possible assistance and emphasis to ensuring that our universities, colleges and schools have the resources to provide the scientists and technicians for the scientific advances that will be necessary if we are to maintain our position as a country with a high-tech industry base.

661
On a lower level, it is important that our connections with industry should be improved. We need to overhaul the structure of education in so far as it is related to industry and commerce. In commerce, I include the service sector because that is a growth area if ever there was one. There may be as many as 350,000 jobs in that sector in the next five years. We must improve the quality of the services that are available to tourists from home and abroad.
It is of immense importance that we see a dovetail arrangement between education, industry and commerce. I do not deny that some connections exist, but they are only a fraction of what is necessary. If a person is to fulfil himself he must have an understanding of what sort of career he wants to take up. That is never an easy process. Some may have an instant desire to be a doctor or to enter a manufacturing company, but the great majority of people do not have the full range of options presented to them. It is through the close connection of industry and education that young people will be able to develop a better idea of the career that they want to take up.
On the other hand, industry, through its connection with education, will have the opportunity to play a part in the school curriculum to ensure that education gives people what industries need. That is immensely important because, even with 3·5 million people unemployed, we suffer from a shortage of people with certain skills; in many cases, basic skills. I am amazed that my constituency has a 9 per cent. unemployment rate—a large figure. I say "large" because the jobcentre has between 400 and 500 jobs or work opportunities and my local paper is full of advertisements for a range of jobs — skilled, semi-skilled, managerial and manual. Something is hugely wrong. Education must ensure that it plays its part in getting closer to local industry and, vice versa, industry must get closer to schools.
Frankly, paying people in industry to go into schools and give a lecture on their products and how their factory operates is not the whole answer. I am against that. It is better to appeal to a person's better nature so that they are doing something because they want to contribute towards the future success of not only their company but the next generation. That is a worthy thing to do. If someone is paid to do that, everybody knows it, and that is not the same as wanting to impart information through a desire to be of assistance.
Much more needs to be done. If the Government, in Industry Year, are to make a contribution to industry, the best measure of all would be to give education full recognition for what it needs to do to bridge the gap between education and industry.
5.25 pm
Mr. Michael Hancock: I congratulate the hon. Member for Saffron Walden (Mr. Haselhurst) on introducing the motion this afternoon because it gives us an opportunity to debate a matter which lies at the heart of Britain's decline. The way in which hon. Members have forcefully put points on the changes that can and should be made should not be lost on those Ministers who are present.
Britain's existing and potential work force suffers from a lack of training and proper skills and the crisis that we are suffering is enormous. It is that part of the education
662
system which is most urgently in need of reform. I do not for one minute want to suggest that there are not other parts of the education system that need change and reform but it is among the 14 to 19-year-olds that the urgency of the crisis is felt so dramatically.
There is a crisis in two senses. Young people are often unemployed, untrained and lack any sense of clear purpose about their future. The social results of that condition are becoming daily apparent to everybody — apathy, alienation, irresponsibility and civil unrest.
There is also a crisis for the national economy. Statistics obtained from the Library for just three of our competitors show how bad our training and skill opportunities are. For example, in the United States 78 per cent. of the civilian labour force have some form of high school diploma. In Germany 66 per cent. of the labour force have a form of vocational qualification. In Japan 60 per cent. have a school diploma. The best that the United Kingdom can do is to have 50 per cent of its working population with one CSE pass. The figures speak for themselves in showing the size of the problem we face. I am sure that the Minister does not need me nor any other hon. Member to tell him and his colleagues about the size of the problem.
Two things need to be done. One is the sharp shock treatment which the Government seem to be favouring in other areas of their policy, and the other is a longer-term look at the situation. Action needs to be taken immediately. We must effect proposals to bring immediate change by way of a crash programme and to provide a comprehensive and coherent framework for the education and training of the entire age group.
That major reform may well take a number of years to achieve. It would be impossible for any party to gamble with people's futures and suggest that the matter can be solved overnight or in a few years. It cannot. It will take as long to cure as it has taken to create if we are to do it properly. But we must use fast and effective measures at least to start making amends for the catastrophe that we now face.
The alliance—I speak on behalf of the SDP and the Liberal party—is convinced that the great majority—
Mr. Pawsey: They are not here.
Mr. Hancock: My colleagues are in the same place as the colleagues of the hon. Member for Rugby and Kenilworth (Mr. Pawsey). It is important not to score points as to which hon. Members are present, but to consider the way in which we can combat our problems. Scoring silly political points might do the hon. Gentleman's ego good, but it certainly will not commend us to the people about whose problems we should talk responsibly.
The alliance aims to give the great majority of young people the opportunity to undertake full-time or part-time education and training. If the policies of the alliance are pursued and a crash programme is implemented, young people will have the opportunity to gain money and experience in the world of work. They will have a choice between different career paths and will be able to afford to choose. They will work within an integrated and flexible qualifications system. Our proposals for reform flow directly from those aims.
The proposals in the crash programme will be steps on the way towards a realisation of long-term proposals. The

663
first step must be to recognise that the link between education and training is indivisible. It is damaging to categorise youngsters into groups because, invariably, it means that many do not fulfil their potential. The fundamental steps must be to combine the Department of Education and Science with the Manpower Services Commission. At present, there is an overlap between the two, jealousy, unnecessary competition and lack of co-ordination. A combined education, science and training Department would, in the eyes of the alliance, result in wide decentralisation with local authorities playing a key role. The Minister of State referred to that key role. It is important for local authorities to give a push to a project to provide more opportunities for more people.
The purpose of our programme should be to produce in as short a period as possible a turnround in the numbers entering courses and qualifying at all levels. The courses should be relevant to the skill shortages in specific areas. The Secretary of State is likely to be frustrated in his attempts to increase the number of engineering degree students because not enough people are qualified to take up the extra places. The alliance's programme would concentrate on pre-degree courses leading directly to entry to higher education or to technician or craft-level courses. We would start immediately, using existing institutions and training mechanisms which would, in the end, be integrated into long-term programmes.
Much would have to be done to achieve our aims. We would need money and a Government committed to spending it on education and training, not merely to talking about it. The sum of £200 million for each year of the programme, which might run to three or four years, would have to be provided if it was to be seen to work. We would need a joint team from the Department of Education and Science and the MSC to conduct the programme. That team would assess the bids and stimulate the proposals that would fulfil certain criteria. I ask the Minister to consider those criteria seriously. They include increasing the numbers on courses in skill shortage areas, increasing the number of likely applicants to fill higher education shortage areas and boosting basic skills, which would result in people able to fit the first two categories. Priority would be given to courses in high unemployment areas.
Funding could be given through subsidies to fund additional apprenticeships and bursaries for students returning to full-time study or relevant courses after a year or two in employment, on YTS, or even on the dole. When I was responsible for apprentice training in one of the factories where I worked, the company missed many opportunities because it was not prepared to invest sufficient money in training its workforce. The hon. Member for Langbaurgh (Mr. Holt) referred to the cost of machinery lying idle while people were being trained. Proper investment in a proper apprenticeship scheme would have saved that company from incurring losses. The apprentices would have learned from day one what was necessary to perfect the skills they would undoubtedly need for new technology and existing practices.
Funding could be given also to special programmes to enable people to return to education rather than sign on for the dole. Funding of training courses could provide the necessary teachers and trainers. We often talk about training people, but do not provide proper training for the trainers. This results in sub-standard training in an attempt to convince ourselves that we are training people for the
664
future. In the short term, we have only invested money in people who are inappropriately trained to pass on their skills and expertise.
The crash programme would, by its nature, concentrate on limited objectives in trying to solve a short-term problem. We must reform the whole system if we are to cope with long-term problems. Young people in the 16 to 19-year-old group fall into four categories — the employed, the majority of whom have no training and a minority of whom are released for daytime study; those in full-time education; those who are on Government training schemes—mainly YTS; and the unemployed.
The cardinal aim of any long-term change in policy must be to make it possible for people in the last category to join the first three. Our proposals are directed towards enhancing access to and the quality of education and training for the first three groups.
Often the alliance is criticised for not having policies relating to the needs of the people, but on training, as in so many respects, our policies have been well thought out and well costed. They aim to meet the needs of existing communities and future needs. We believe that there should be a legal obligation on all employers of 16 and 17-year-olds to release them for education and training for two days a week, or its equivalent. If necessary, such an obligation on the employer could be matched by a contract of employment which obligates the employee to attend such courses.
The Parliamentary Under-Secretary of State for Employment (Mr. David Trippier): Is that idea meant to be appropriate to small businesses? Would they be required to allow some of their employees to be absent for two days a week?
Mr. Hancock: Small businesses and large companies must accept the obligations. Many small businesses have enjoyed the facilities of YTS and the skills of those people lucky enough to be given proper training. It is no good absolving a company from responsibility on the grounds of it being a large or a small company. This must be seen to be a fair and equitable measure across the board. If it causes problems for some companies, we would hope that resources would be found to provide not only training and expertise but to allow the company to give employees that time off. That is why I referred to the need for money. This picks up the point made by the hon. Member for Langbaurgh about the cost incurred when the machines were not operating.
Mr. Holt: Is it alliance policy to direct firms to take people on? Many small firms will not take on people if legislation to this effect is introduced. If the hon. Gentleman had listened to what I said earlier, he would have heard me say that the capital cost of major plant is such that it must be kept in operation for 24 hours a day and is therefore not available for training. I think that the hon. Gentleman missed the point.
Mr. Hancock: The hon. Gentleman is rather pessimistic. If the scheme is properly funded and brought into operation, those points can be covered. It would be absurd to suggest that small businesses can cope with the absence of two or three trainees for two days a week or with machinery lying idle for longer periods. If the scheme is put together correctly and is properly funded and planned—in contrast to the ad hoc approach at present

665
—it could work. The pessimism of hon. Members has led many small employers to feel reluctant about embracing schemes of mutual benefit to the whole nation.
We must first recognise the imperfections of our training and try to develop it and encourage small business men to participate. We will get nowhere all the time we place obstacles in the way of a solution. I hope that hon. Members will try to develop a better understanding of training and encourage employers to look more favourably at such proposals.
I hope that there will be major improvements in the youth training scheme and an increase in off-the-job training to the equivalent of two days a week. We should welcome the expansion of information technology centres.
The Government should support a shared starter-job scheme as an alternative to my first and second proposals. They should show that support in those areas where they are directly responsible for employment and training. They would be jobs rather than training schemes. The starting salary could be split between two young people. They would each work half a week and receive training during the other half. The Government should cover the cost of the training and the additional employment cost. The cost would not be as much as is sometimes paid out in benefits now. Employers and the nation would benefit.
There should be a young student grant paid directly to full-time students aged 16 to 19 years. That could be paid to all students or means tested fairly according to the family's income. Child allowance would continue to be paid to the parents and the young student grant would be the difference between the child allowance and supplementary benefit. If the Government were prepared to accept that proposal, an impediment towards getting things moving could be removed.
Mr. Pawsey rose—
Mr. Hancock: I must continue. Other hon. Members wish to speak and I am sure that the hon. Gentleman will have ample opportunity to make whatever political points he wants.
In addition, a young returners grant could be paid to students returning to full-time education after a year or more on the YTS, in employment or unemployment. It would be aimed at boosting the number of part-time craft and technical courses which should increasingly take the place of apprenticeship.
Grants should be paid to those young people with the motive and ability to benefit. They should be means tested according to individual, not family income.
All those proposals will cost money. It is no good us congratulating the hon. Member for Saffron Walden on bringing the issue before the House. We should all be prepared to tell the nation that there will be a price to be paid. If we do not pay that price, the circumstances I quoted earlier will continue. We shall be putting our heads in the sand and hoping that the problem will go away. Our experience over the past 10 years tells us that the problem will not go away. It will worsen. Those hon. Members who have tried to score cheap political points should not suggest that my proposals provide no answer to the problem. The proposals could benefit us in the future.
Mr. Chris Patten: I do not wish to make a cheap political point, but how much will those proposals cost?
Mr. Hancock: They would be expensive. The crash starter scheme programme would cost £200 million a year on present costings. The long-term proposals would be extremely expensive.
Mr. Patten: How much?
Mr. Hancock: Will the Minister tell us how much is being spent on youth unemployment benefit and other payments, when he replies? The two figures would not be significantly different. We should decide whether we are prepared to pay the price of doing nothing, or pay what I suggest is not significantly different from what we are paying now. Failure to implement my proposals will mean that debates such as this are no more than words.
I am sure that the unemployed are sick to death of hearing people talk about the problem. They want to see action. They want an opportunity to obtain the skills and training which will put them into the jobs that the Minister and his colleagues are keen to tell the House are available if people put their minds to obtaining them.
We all know that without training and expertise, youngsters will never be able to fill those posts. Employers will be unable to create more jobs unless the Government and local authorities are prepared to work together to create jobs and make the atmosphere for job creation a damned sight more attractive than it is at present.
5.45 pm
Mr. J. F. Pawsey: I listened with interest to what the hon. Member for Portsmouth, South (Mr. Hancock) said. I noted carefully that he was speaking on behalf of the Liberal and Social Democratic parties. I should, however, be interested to know what is the detailed cost of his proposals. It was not good enough to say that the reasoned objections and questions from Members on this side of the House were cheap political points and to dismiss them. He sought to produce a reasoned argument and it was right for him to be asked what the proposals would cost. I was disappointed with his answer to my hon. Friend the Minister of State.
The hon. Gentleman also mentioned apprentices. I am sure that he would agree that part of our problem is that in the United Kingdom apprentices are paid about 60 per cent. of a skilled man's rate. In West Germany, the equivalent figure is 20 per cent. He might agree that that is the principal reason why we have fewer apprentices than West Germany.
I am sorry that the hon. Member for Huddersfield (Mr. Sheerman) is not in his place. He referred to the teachers' dispute. He sought to make what seemed to be a genuinely political point on pay. I was disappointed but not surprised that he did not recognise the importance of my right hon. Friend's package of £1·25 billion which has been obtained from the Treasury for teachers' pay. I was also disappointed that he did not respond to my hon. Friend the Minister's challenge when he said that teachers' pay is now about £800 per annum more when compared with the pay they received when his party was in power.
I add my congratulations to those already heaped upon the head of my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) on his good fortune and on selecting such an admirable motion. In this, as in most things, it is important to come first. I do not feel any sour grapes even though I drew motion No. 3.
Had I been successful, my motion would have referred to the south Warwickshire coalfield and would have

667
outlined my anxiety about it and the way in which it will affect the environment of my constituency. Nevertheless, I freely acknowledge the importance of this motion. Education for 14 to 19-year-olds is most important. I shall paraphrase George Orwell: whilst all education is important, some parts perhaps are more important than others.
The National Association of Head Teachers report has been mentioned and has much to commend it. There should be a freer and easier exchange between education and industry — between the schools and colleges and industry. Currently, it is fashionable to talk about flexible retirement. We should be discussing flexible school leaving with early leaving being tied closely to effective training. I was pleased to hear my hon. Friend refer to the technical and vocational education initiative. I should like to see greater use made of centres of excellence. They are often seen as being only for the academic but there is no reason why that should be the case. They could equally be used to concentrate the best technical minds.
Those who would not find their way to such centres could remain in the school environment for their secondary education. It often happens, however, that children are taught in what seems to be an educational vacuum, where the outside world scarcely impinges upon the work carried out in the classroom and where study has little discernible relevance to a future job. Learning for learning's sake is always to be commended, but what may be of greater value is education which prepares young people for industry and commerce. After all, that is where the majority of our young people will earn their living. We should not be ashamed to say that we educate our children for work, and I commend my hon. Friend the Member for Saffron Walden on the use of that phrase. It is one which obviously has particular relevance to this debate. I believe, as I am sure he does, that the syllabus should have a greater relevance to the job market.
Another point made by my hon. Friend the Member for Saffron Walden was that this is Industry Year and it was noteworthy that he referred specifically to that in his motion. This specially designated year sets out to bridge the still considerable gap between school and industry. Much useful work is being done and the breadth of imagination that is being displayed by some schools and companies is worthwhile. This year might be the launch pad, but it is important that the impetus should be maintained next year and the years after. One of our aims, therefore, should be to reforge the link between education and industry. In the past, at least to some extent, that was performed by the technical schools. In those schools and their sister institutions, the technical colleges, education was provided which had a particular bias towards the type of industry in a particular area. For example, in Coventry education was directed towards the automobile industry whereas in Bradford it was directed towards textiles.
Even some of the teachers and lecturers in those schools and colleges had a practical experience of a specific industry. That was of substantial benefit to the young people in the schools and colleges because the teachers brought with them knowledge of the shop floor and the workplace. These days, those who teach often have limited experience of business and industry, having gone from school to college and back to school again. It is no wonder that some teachers are a little uncertain about
668
industry. It is no wonder that when our young people leave school they often regard industry as a last resort. It sometimes seems to be a daunting and strange place.
It is unfortunate that after 11 years, or thereabouts, of full-time education so many of our young people are ill-equipped for what is expected of them. Since the experience of many teachers is confined to school and college it can be no surprise when they promote, probably unintentionally, the professions because they understand the professions better than industry, with its emphasis on skills, management and profit. Therefore, it seems that there is a need for a shift in teacher training so that teachers are more exposed to the demands of the factory and the office and have a better understanding of the requirements of modern business. The syllabus and the ethos of teacher-training colleges should reflect a greater understanding of the needs of industry.
I have referred to centres of excellence. The selective schools, both grammar and technical, did much good. is significant that the selective system has been maintained in such differing countries as France, Germany and the Soviet Union. One of the paradoxes to which I have referred on previous occasions in the House is that, despite doubling the money spent on education, standards have not significantly improved. That point has been hammered home by my hon. Friend the Member for Brent, North (Dr. Boyson) and I am delighted to see him in his place on the Front Bench. My hon. Friend the Member for Dartford (Mr. Dunn) has also referred to that point, and he was justified in so doing.
I have referred to Northern Ireland where examination results have shown a dramatic improvement when compared with those of England, Scotland and Wales.
Mr. Martin Flannery: Nonsense.
Mr. Pawsey: With respect, the hon. Gentleman should see the figures. If he saw and understood them, he would have difficulty in refuting my point about Northern Ireland and the type of education now enjoyed in the Province.
Northern Ireland is the only place in the United Kingdom which has maintained a selective system and I would argue that Northern Ireland would be an admirable benchmark for the rest of the United Kingdom against which the present system might be judged. I shall paraphrase a former Member of the House when I say, "Why look into the crystal ball when one can read the examination results?"
Earlier I argued for an easier movement of young people between industry, college and school, but I believe that that should be founded on the bedrock of school stability. That is often best provided by the maintenance of sixth forms within the established fabric of schools. I am convinced that the sixth form does a great deal for the individual and the school which retains that system.
Mrs. Edwina Currie: Hear, hear.
Mr. Pawsey: I am delighted to hear my hon. Friend the parliamentary private secretary agreeing with me. I am certain that I am not embarrassing my hon. Friend in any way, but if I am I shall withdraw my earlier remark!
Certainly the sixth form promotes a sense of responsibility and significantly, where colleges of further education exist alongside schools with sixth forms, the majority of pupils elect to stay within the school

669
framework rather than transfer to the greater freedom of the college. In many cases, young people of 16 are not ready for college and prefer the continuity and discipline of school. I was particularly interested to hear my hon. Friend the Minister of State say that no system of tertiary education would be imposed. Clearly, as he said, there is a place for variety and choice within the education system.
Schools would benefit from having greater control over ther own budgets. Governing bodies and heads would have more freedom and responsibility to decide on the syllabus within their own school. I suspect that that would lead to a more relevant form of education, particularly if it was allied to a method which made it easier for parents to choose between schools. This is not a debate on the voucher, but I believe that more choice for parents would put greater pressure on schools to provide the type of education and discipline that would best give young people a chance of getting a worthwhile job.
I welcome the GCSE, but I realise that not all children will derive benefit from it. Those who are less suited to academic education should be provided with real and worthwhile training in relevant skills. If languages or physics are genuinely of little interest to a specific pupil, why not then concentrate on bringing out the strength of that pupil? That, in turn, will develop the confidence which comes with an appreciation of skills. It is better to do that than to develop a sense of inadequacy through repeated failures.
The problems in education have been visible for years. We should remember that the right hon. Member for Cardiff, South and Penarth (Mr. Callaghan) called for a great debate 10 years ago. Ten years ago, it was recognised that all was not well. Education was not and, I fear, is not up to parents' expectations. The education system has not delivered the goods.
The battery of measures that my right hon. Friend the Secretary of State has introduced during his tenure of office, particularly on teacher appraisal, will undoubtedly help. I hope that the common sense that has been exhibited by my right hon. Friend will be recognised by teachers and by parents. Surely it is right that the good, conscientious teacher — thank God that they are in the majority — should be adequately rewarded and that professional pride be restored.
I conclude by repeating a point I made when we last debated education. In 1976, the performance did not match the rhetoric. For the sake of our children and their future—and the nation's future—I hope that that will not be the case in 1986.
6 pm
Mr. John Golding: The Government are very good at one thing, and that is demolition. Indeed, when the Prime Minister is finally driven out by the wolves, or perhaps the sheep, I believe that she will turn her back on south-east London and make for the north. I can see her now, running amok, blowing up chimney stacks, with the light shining in her eyes, because this is a Government of demolition experts.
The Government are good at demolition, but they are useless at building. Nowhere is that seen to be more true than in training. They have smashed what was and put too little in its place, except for the 16 and 17-years-olds. As Parliamentary Under-Secretary, I was responsible for
670
training in the Government of my right hon. Friend the Member for Cardiff, South and Penarth (Mr. Callaghan), and it was not an easy job. Training does not arouse much emotion, interest or concern, unlike unemployment, with which I also had to deal. The staff engaged on training were the least effective in the Manpower Services Commission because they did not have the right background. The industrial training boards were far better, but there were one or two bad ones. Many employers at local level just did not want to train, and there were even trade unionists whose love of tradition and rules stemming from antiquity would have qualified them for your distinguished office, Mr. Deputy Speaker.
Those of us who wanted improvement constantly sought changes, trying to harmonise the MSC and the industrial training boards, trying to ensure that training met actual need at both local and industrial level, trying to ensure that both the quality and quantity of training were correct and, most difficult of all, trying to ensure that the arrangements for payment for training were equitable. We tried, and we tried hard, but it was a hard, slow process. It had to be because we were dealing with people who had a lot of pride in their current arrangements and a lot of prejudice, too. When one deals with people's pride and prejudice, one needs to be cautious, careful and considerate while persuading them to change. It was a slow job, which we did not finish before the general election.
Then came the so-called Tory radicals. Like most revolutionaries, they acted on the presumption that all one has to do is smash what exists and everything will be all right for ever more. The revolution, in itself, will bring forth the natural goodness of people, by making them free. That was the Tory revolutionary doctrine.
As I listened to Tory Ministers spouting after their 1979 victory, I was reminded of Russian Communist propaganda films that I watched and laughed at as a boy. So I laughed somewhat bitterly when I was told by Tory Employment Ministers that, after the smashing of much of the industrial training boards system, voluntary arrangements would herald a new dawn. Freedom, self-help and individual initiative are to be encouraged, of course, but one cannot rely on them alone in training. Sometimes one needs rules, discipline and compulsion to make people behave properly towards one another and society as a whole. My experience tells me that in training one needs rules that can be enforced. However, Tory Employment Ministers have acted like parents who have placed too much faith in the teachings of Dr. Spock and then acted unreasonably, angrily and bitterly because their offspring have failed to turn out like the book. They have gone from over-indulgence to becoming screaming, gibbering wrecks in no time at all.
Ministers took away the statutory obligation to train. Now they are running from one dinner to another, pouring out press releases as they go, being critical of the employers' lack of training facilities.
Mr. Holt: Does the hon. Gentleman accept that there never was a statutory obligation to train? There was a statutory obligation to pay for training, and many people never did any training at all.
Mr. Golding: I accept that correction, but the training took place, and taking away the statutory obligation to pay has taken away the training itself in many instances.

671
Let us return to the preaching. My advice to Ministers is that there is no point in that preaching. They should save their breath, and, at those dinners, give their puddings time to settle rather than make those useless speeches. The employers' attitude is quite clear. According to the old rhyme, "Sticks and stones may break my bones, but press releases never hurt me." The press department in the Department of Employment should recognise that.
In any case, press releases do not tell the shareholders that companies are not spending money on training which is not immediately necessary to maintain a firm's profits. The nub of the problem of training is this. It does not necessarily pay an individual firm to spend money on training. We must emphasise that. It is no use telling a firm that it is in its interests to train when the accountants say that it is not. It is cheaper to poach. One can pay higher dividends to shareholders if one ignores the needs of the next decade. That is regrettable and I represent work people who desperately need training and retraining. In private industry investment in machines shows up on the balance sheet, and investment in people does not. That is something that Ministers must come to understand.
Mr. Tony Marlow: Will the hon. Gentleman give way?
Mr. Golding: The hon. Gentleman is an old friend of mine. I relied on his interventions in the Committee on the British Telecommunications Bill to carry me on for months. He is entitled, after two minutes in the Chamber, to make a three-minute intervention in my speech, but I say this first. There is a conflict between the interests of existing shareholders and the needs of the country's industry and work people.
Mr. Marlow: The hon. Gentleman was obviously deep in his notes earlier on when I was previously in the Chamber. However, I am grateful to him for giving way. The hon. Gentleman seeks to represent one of our largest and most important private industries. Is that private industry—I am sure that he is dying to tell us anyhow—doing sufficient training at the moment?
Mr. Golding: The answer is no, but I had not intended to make an election speech this evening.
I believe that a company's obligation to its shareholders means that we must have a wide basis of statutory obligation — the hon. Member for Langbaurgh (Mr. Holt) would say for payment—backed by a system of payment that is fair to employers and taxpayers. Without statutory obligation, the needs of the young will be neglected, the need for training and retraining older workers to avoid redundancy and unemployment will be ignored and the development of individual potential will be neglected. I emphasise, as I always wish to do in debates on training, that training is not only for the needs of employers, but for the needs of individuals so that their potential can be fully developed. Without a statutory obligation, the whole future of our manufacturing and industrial society will be put at risk.
The only answer to the question "What shall we do when the oil money runs out?" is that we must rely on the tremendous talent and abilities of the British people. That answer will carry no conviction if the Government carry on with their present policy of depriving industrial training of its rightful place in society.
672
I congratulate the hon. Member for Saffron Walden (Mr. Haselhurst) on his foresight in bringing forward the motion today.
6.12 pm
Mr. Geoff Lawler: One problem with following such a constructive and farsighted speech as that by my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) is that the ideas in my speech that seemed innovative when I wrote it earlier suddenly do not look so original. Although I agree with my hon. Friend on many matters, one of his most telling comments was that a great success of the Government has been their policies on education and training. We have generated a whole change of attitude that has enabled an end to be seen to an underqualified and underdeveloped work force that has led to an underpaid and an underemployed work force.
We have seen changes in the attitude of employers, who recognise that investment in people is necessary and that they must train if they are to compete and to produce innovative products and if their growth is not to be restricted by skill shortages.
We have seen a change of attitude by unions, who recognise that a lower wage does not necessarily equate to slave labour or pose a threat to adult members of the unions, but is simply a reflection of the costs of an employer's investment in people.
Young people have changed their attitudes. They recognise that they are not qualified to seek proper work at 16 years of age. They are prepared to defer immediate earnings for enhanced prospects and greater rewards later.
The Government and those three constituents have accepted the need for change, but there is still much to achieve. We must not sit back. We must go on to achieve more. Young people need better preparation to know what they want from life and career. We must identify skill shortages and produce schemes to overcome them. We must co-ordinate school and workplace qualifications. Industry must spend more than the average 0·5 per cent. that it spends now on training to reach a figure closer to the 3 per cent. on average spent by our competitors. We must provide post-YTS provision and above all we must rid the youth training scheme of the stigma that it is only for the unemployed. As long as it is seen by young people as the second-best option, it will never have the credibility and respect that it deserves.
We are now providing the paths that lead from school to industry. However, young people wish to be advised about which path to take. Several hon. Members, including the hon. Member for Saffron Walden, have raised that point. I pay tribute to careers staff who do magnificent work at a difficult time. But careers advice to young people in our schools is wholly inadequate. Staff are expected to know everything. They have to advise young people who want to be bus drivers and those who want to be astronauts, those who want to be hairdressers and those who want to become Members of Parliament, God help them. They are backed up by out-of-date and unattractive material.
The careers service needs a shake-up. It must be better resourced, but we must also specialise and concentrate the advice in centres, so that people can, for example, watch attractive videos showing what training is needed or what is involved in each career. Specialist careers advisers are needed for those centres to advise on their special subjects.

673
If a young person wishes to become a bank manager, he could go to the specialist who knows how banks work and what training and qualifications are needed.
Those materials and advisers should be made available to people from the age of 13 and 14, so that they can map out their future at an early stage. Otherwise, we shall continue with the current system in which careers advice in many schools means that the bright are shoved in the direction of university and college and the not so bright must fend for themselves.
We must open up wider horizons for young people in schools, so that they can appreciate the opportunities available to them other than those into which they are traditionally channelled because of what their parents do or the type of community in which they are brought up. They should be shown at an early age what core subjects they should take to provide them with the career that they want.
In the inner cities especially, we need to provide young people with hope through careers advice. From the early age of 12 or 13, they see little point in being diligent at school and in choosing career paths, because those openings are not available to them. I recently visited a school in a part of my constituency which has a male unemployment rate of 60 per cent. to 70 per cent. We must ensure that careers teachers and advisers can counter that problem by showing children that making the right choices can push them in the right direction and enhance their chances of success. We must not allow young people of 13 to 15 to despair or become disillusioned. They must see that there is hope and opportunity for them.
The careers service should be shaken up. We should scrap the post of careers teachers. By all means, have a link person in schools, but all the careers service should be concentrated under one roof. Specialist centres should be opened, so that existing resources are concentrated instead of being spread thinly.
We must encourage careers teachers to rid schoolchildren of the idea that when they leave school at 16 they are ready for work. We must ensure that 16-year-olds realise that they must continue with further education and training before they are suitable for employment.
Links between colleges and industry are a great help. I am especially pleased that Bradford, with two thirds of its schools linked with industry, is above the average for cities.
We must ensure that colleges and the courses that they run are flexible to industry's demands. As hon. Members have mentioned, colleges must be properly equipped with the machinery to train people to provide the skills that industry needs. One way to help is to allow companies' donations to educational institutions in the form of equipment or cash to be offset against taxation, in an effort to free more resources for colleges.
Through local consortia and chambers of commerce, we must identify skill shortages. My city is in the ludicrous position that 40 per cent. of the long-term vacancies are still vacant because training is needed. The local consortia could suggest opportunities for business, because they could identify goods that could and should be produced by local businesses and help to train people for those opportunities.
From secondary school onwards, we must prepare young people in a way that allows them to make the
674
maximum use of their time. Even the middle schools, with children aged between nine and 13, should be linked with the upper schools and we must co-ordinate pre-school leaving and post-school leaving qualifications, so that we end the situation in which many people discover, on reaching adulthood, that the exams that they took at school were irrelevant.
We must ensure that the time spent studying for GCSE or CPVE is useful for career progression and can be further developed during post-school training to gain a final work-based qualification.
If we are to ensure that the advantages of all the changes that we are seeing in education and in training and all the advantages of going on a youth training scheme are not wasted, we must ask, "What happens after YTS?" Fortunately, more and more companies are becoming farsighted enough to incorporate the YTS into their existing training schemes; the electrical contractors are a shining example of that.
Already, 38 per cent. of those who go on the YTS and get jobs go into placements offering higher levels and longer periods of training. However, despite all the guidance and the training, some will remain unemployed. We must ensure that that is not the end of the line for them and that they do not feel that they have been forgotten. We can add to the credibility of and respect for the YTS by ensuring that there is something at the end of it. The most often voiced criticism of the YTS is that there is nothing at the end.
The Government cannot guarantee a job and should not do so, but they can guarantee continued opportunties for self-development. There are already a wide range of voluntary schemes and MSC-funded schemes in our cities, but they lack co-ordination, use thinly scattered resources and are provided haphazardly. We should increase the facilities available and make greater use of existing resources. Why not open the universities and polytechnics during the evenings and weekends, when millions of pounds worth of equipment is left idle, training no one? Similarly, the capital provision exists for TVEI, the ITECs and training centres. That could be used for the benefit of the community. No allowances would be necessary; further training and qualifications for the unemployed would be the incentive.
We should always be looking to encourage self-employment as an option. A recent youth survey showed that 30 per cent. of young people wanted to be their own bosses. Indeed 25 per cent. of those who had taken up the enterprise allowance were under 25. Through the schools and the YTS, we must continue to advise young people on how they can become self-employed and run their own businesses.
I should like the enterprise allowance to be extended so that those who leave the YTS do not have to be unemployed for three months before taking advantage of the scheme. We should provide a scheme that pays young people from the moment they leave the YTS to help them to set up their own businesses. I believe that young people would respond to such a scheme which would remove the anomaly that they must be unemployed before they can go into business on their own.
At last we are getting it right and it is important that vocational education and youth training should be for all. It must be for the bright as well as for the not so bright. We need to encourage the more able young people to

675
consider new career paths and not only the safe options. One merely has to look at the quality of some British management to see how much training is needed.
By training the strong to achieve their full potential, we help the weak. The most significant achievement of our vocational education and youth training programme is that we are helping the weak to achieve aims that they would not have thought of achieving if Government help had not been available. They are finding new talents, perhaps through gaining employment as programmers or by setting up their own businesses.
Baseless criticism of the YTS is becoming progressively less sustainable. Unions that do not participate hamper industry and deny opportunities to young people. Companies that do not offer places are short-sighted and ignore the direct correlation between more training and better performances. Groups such as the Labour party and Youthaid, which purport to represent the interests of young people, actually destroy prospects every time they put someone off joining the YTS. Those groups have a strange idea of what is in the best interests of young people. It is like Greenpeace campaigning for lower taxes on harpoons.
As Youthaid reports, 10 out of 11 young people opt for the youth training scheme and 84 per cent. of those on the scheme are happy. That is a remarkable success story and one that any product manager would be delirious to achieve for the launch of a new product.
For too long this country has relied on the strong to help the weak. Effective vocational education and youth training allows the weak to help themselves to become strong.
Several Hon. Members rose—
Mr. Speaker: Order. It may be helpful if I announce that I understand that the Front-Bench speakers would like to start at 6.45 pm. A number of hon. Members still wish to take part in the debate and I hope that they will bear that in mind.
6.26 pm
Mr. Jack Thompson: I add my congratulations to the hon. Member for Saffron Walden (Mr. Haselhurst) on initiating the debate. It has been a fascinating discussion and there has not been too much dispute between Conservative Members and some Labour Members on a number of issues.
About 10 years ago an old and wise friend of mine said that we ought not to talk about "education" and "training", but that we should use the word "learning". From the day we are born till the day we die, we never stop learning. As babies and children, we learn from our parents and we progress through nursery school — if we are lucky enough to have such schools in our area—to primary school, secondary school, college, university or work experience and training. The last thing we learn is how to die—and we never repeat that experience.
The hon. Member for Saffron Walden made a significant point about linking education and training. There has been a division between the two for far too long. We need to change that. The suggestions of the hon. Member for Saffron Walden should be noted by the Government because they would provide a good base on which to work.
676
The hon. Member also mentioned the need for a department of education and training. I support that suggestion, though I should prefer the title of department of learning.
Hon. Members on both sides of the House have referred to the relationship between local education authorities and the MSC. I have known occasions when the relationship was so bad that the two sides, were virtually not talking to each other. That is a sad reflection of the way that training has developed and of the difference between the funding for the MSC to support training and the funding for local education authorities.
Two or three years ago the education authority in my county had discussions with the MSC and one of the principal reasons why a local technical college was able to stay open and provide the facilities that it was built for was that we got funding from the MSC and allowed young people to use part of the premises to occupy their time. It involved about £650,000—a form of blackmail from the MSC to the education department to provide space for its programme. That space was intended for the specific purpose of training young people in higher skills than those being offered by the MSC. I do not criticise its training of young people, but the facility was not being used for its intended purpose.
I went through the traditional training system—I was an engineering apprentice for five years. Apprenticeships lasted from the age of 16 to the age of 21 — so if someone was 16 years and 2 days, he could not obtain an apprenticeship. I was 15 years 11 months when I was offered my apprenticeship, so I was rather fortunate. It was very clear cut, and the formula was based on the old craft guilds. The apprentices, journeymen and craftsmen followed a set procedure that dated back to the middle ages.
The pattern has changed and we have moved from five-year apprenticeships to four-year or even three-year apprenticeships, depending on the skills required, However, we are not adjusting in industry to those changes. We still talk about apprenticeships, but we should put them in the right context. Both employers and trade unions must look again at craft training and apprenticeships. Indeed, it may prove necessary to dispense with that whole aspect and instead think of training and retraining, regardless of age.
We are in a vacuum because the old system is disappearing and there is no new system to take its place, and that is creating many problems. The education service is under pressure because of the reduction in Government spending. The Ashington technical college in my constituency is doing a magnificent job, but it has to cover a county of about 50 miles by 50 miles. It cannot adequately provide for those living in the more rural parts. The college has developed an annexe system which, although good, could be better with the right investment. I am very proud of that college; indeed, I am an ex-student of it. In the good days it had money to buy equipment and provide facilities. With the cuts in spending today, young people are not having the right opportunity to develop their skills.
Conservative Members have referred to the training of those aged 14 and over in local industry. I remember when the coal industry was predominant in my constituency. By the end of the second world war, young people were conditioned to entering the coal industry, although they might also have had to enter the Army for a short time.

677
There was no alternative for them. A 10-year-old was aware that he would be a miner. Times have changed, and so has industry.
I could not support a system where the emphasis in schools was placed on conditioning children of 14-plus to become virtual clones for local industry. Training in and understanding of industry is one matter, but the training of young people for only one industry is quite another matter, and I would not be happy to support that.
There has been some discussion about the industrial input in training colleges. I remember when mature students, sometimes with 10 or 15 years industrial background, undertook teacher-training. That was an excellent scheme. Today, we could not find anyone who would willingly leave industry to train as a teacher. That is the sad part of the current trend.
Industries in my constituency underuse their training facilities because they cannot afford apprentices. They would be happy to take on more young people if there was some Government support. I am fortunate to be involved in the Industry and Parliament Trust and I am also seconded to the North-West electricity board, which has an excellent training centre just outside Manchester. It would be happy to train young people at that centre, which is underused, but it does not have the necessary finances. There should be financial support for that sort of scheme.
I am glad that we have been given the opportunity today to discuss these issues. I hope that there will be a number of other occasions when we can discuss them again so that we can eventually obtain the system that the hon. Member for Saffron Walden genuinely supports, and which I support in principle.
6.36 pm
Mr. Andrew Rowe: The theme of the debate has been partnership, and the partners within the system are, first, the children and young people who want their curiosity satisfied. That means stretching them. I served on the Swann committee for five years. The message that came from every part of the country was that young people were dissatisfied with their education because they were not stretched, not because they were being taught too much. However, I think that there is too much teaching of the sort that Mr. Gradgrind indulged in—filling little pitchers with fact. Speaking as a former university teacher, I met far too many students who entered university far past their learning peak. They had achieved entry by being crammed for exams by skilful schools. They no longer had a great deal of intellectual curiosity, so their three years at university were often disappointing for them and for their teachers.
Secondly, the teachers are currently an issue in themselves. One of the great problems is that they are torn between the manifest demand outside teaching for specialists in robotics, maths, physics and other subjects and their ineradicable belief that no differentiation in salary should be made between one faculty and another. It is an important and difficult question to which too many teachers do not pay sufficient attention.
The third partner in the group is the board of governors of a school. My hon. Friend the Member for Saffron Walden (Mr. Haselhurst) said that we should pay business men to take on the governorship of schools, but that is not the reason why they do not sit on those boards. It is
678
because it is a non-job. It is an important, difficult and taxing task, but the amount of decision-making open to them is derisory. No one worth his salt would come out of business to do that job. We must devolve real authority to the governors.
Of course, we must consider the parents. It is sad that at a time when parents have so much leisure—more than they have ever had in our history—teachers teachers are almost unanimous in saying that involving parents is virtually impossible. I do not blame the parents. During the 1960s and 1970s teachers spent a great deal of time saying, "Hands off—this is a specialist job. Anything you bring to the school will be old-fashioned, out of date and tiresome. Will you kindly leave us alone to get on with the job of teaching your child in a modern way?" Having sown that wind, they are now reaping the whirlwind and finding great difficulty in persuading parents to assist in schools—despite the fact that many of them would be glad to do so.
The Government must give serious attention to videos. More than half the households in Britain have a video. I am prepared to bet that entertainments represent 95 per cent. of the programmes on those videos. We have to develop a major programme of educational videos for pupils to take home with them and use on their home videos. Half of the pupils would lack the self-motivation to do that properly, and they could stay on at school to be taught in classes which themselves would be halved. The other pupils would spend their time at home learning from the masters of the trade and in a form to which they have grown accustomed. We need a modern day Carnegie. If we cannot find one, the Government will have to do it for themselves. The Government will have to set up a massive trust—ideos, unlike books, are expensive to produce—to provide copyright-free videos so that people, without pirating them, can copy them for their children.
Mr. Sheerman: The Open University would do that tomorrow.
Mr. Rowe: The Open University may well do it tomorrow, but it takes up to six years to produce a video, and that would be too long.
The employers are the last link in the partnership, and it is true that they do not know what they want. The Government have been coherent and right in their approach to the qualifications net. We have to develop a method of choosing people by aptitude rather than by qualification.
We should allow teachers far more opportunity to train and retrain but it will be expensive to do that. We should seriously consider whether our school terms are not too long. We use our schools as a social control mechanism, and for that reason people keep their children at school for many months of the year. In practice, much of what goes on in schools could be condensed without loss. If one did that, there would be more time for teachers, as part of their contract, to be trained and retrained in ways that they would like. I believe that children could be found placements in industry and thus gain experience.
It is sound that the Manpower Services Commission should be the engine for so much of this change because the Government have some authority over the MSC, whereas they have no real authority over the national education system. However, I know from my own constituency that schools are finding it increasingly

679
difficult in Industry Year to find work placements for children because of the demands of the expanded youth training scheme. The Government must remember what their left hand and right hand are doing.
6.43 pm
Mr. Martin Flannery: I understand that I have only three minutes to speak. If I could spend the time agreeing with the motion, that would be enough, but there are harsh realities to be faced. I never cease to be amazed by the bland effrontery of the Tories when they put forward this type of motion:
"That this House calls for future policy towards 14 to 19 year olds to be based on a close integration of education, training and the Youth Service, taking full account of the aims and objectives of Industry Year."
We talk about Industry Year, but let us be clear: it should be called "Lack of Industry Year" or "Death of Industry Year" because of the Government's actions. That is the reality that young people face.
The Government have talked about close integration. We would love close integration, but there is disintegration of the entire education system in Britain because of the sheer brutality of the Secretary of State for Education and Science and the Prime Minister. The right hon. Lady has ordered the Minister virtually to destroy industry. British industry is in the greatest crisis that has ever been witnessed because of the Tories—and they talk with bland effrontery as if they really mean what is said in the motion.
I heard the hon. Member for Harrogate (Mr. Banks), wealthy and well-heeled, talk about unemployment dominating us until the end of this century. Left to the Conservative party and to him, of course it will. We have to face the fact that unemployment is not an act of God, although the Government talk as if it were. It is an act of this Government under the system in which they believe. The Government do not know how to handle the system in which they profoundly believe. Therefore, within the framework of that system they do not know how to handle the state system of education. The Government are pouring money into private education and taking it away from public education.
The Government have talked about education, training, youth service and leisure. They have given plenty of leisure to the youth of this country and they are now putting them on training schemes largely to keep them off the unemployment registers. If one added young people to the unemployment list, there would be 4 million unemployed. That is harsh reality, no matter what the Government say.
Within the three minutes I have had at my disposal I have not been able to do what I have done in every education debate and every education Question Time in the past 12 years—discuss how to advance the cause of education. The one thing that will advance the cause of education in Britain is to get rid of this Government. We must fund education properly and value our teachers and children properly. The Government will never do that until they are made to do so by the people of this country, represented by the Labour party.
6.46 pm
The Parliamentary Under-Secretary of State for Employment (Mr. David Trippier): My reply to this debate gives me a golden opportunity not only to thank my
680
hon. Friend the Member for Saffron Walden (Mr. Haselhurst) for initiating the debate with his excellent speech but for his distinguished career in youth and community service over many years. Many of us remember him, between 1966 and 1968, as a very distinguished chairman of the Young Conservatives. My hon. Friend had a special ability to organise conferences such as the one we have witnessed this weekend. He subsequently went on to be chairman of the Manchester youth and community service council.
My hon. Friend also played a significant part in the programme entitled "Youth Charter Towards 2000". He also has the dubious honour of being the Member who sponsored me for the Conservative parliamentary candidates list. This speech gives me the first opportunity to thank him publicly for that. Despite his latter digression, his judgment in these matters is normally sound and his concern for education and community development is certainly unquestioned.
My hon. Friend, in speaking to his motion, was skilful in cataloguing the various schemes which have been introduced in the past seven years. I welcome his praise of many of them. I also welcome his suggestion that there should be greater coherence if we are to achieve the various targets we have set ourselves. Not least of these is our attempt to increase awareness in the minds of the young of what programmes are available and to convince them and their parents that we have a common and integrated approach throughout Government.
All the speakers in the debate seem to have agreed on one thing—that young people represent the future. If we do not give them the chance to develop the skills they need and do not encourage the right outlook, prospects must suffer. The well-being of this country depends on our giving young people the knowledge and understanding to build the nation's ability to create wealth. For this reason, much depends on our approach to education and training of the young.
There are several key elements in that approach, as suggested by my hon. Friend the Member for Saffron Walden. We must offer a wide range of choices and opportunities. We must give access to marketable skills and establish schemes and a system which are coherent in philosophy and practice. More than that, as my hon. Friend the Member for Rugby and Kenilworth (Mr. Pawsey) said, we must bring young people into contact with the world at work and develop the enterprise culture early. We must change attitudes and make the development of enterprise and initiative a common feature of education and training for young people.
I noticed that the word enterprise was generally lacking in the speeches of Opposition Members. There were only one or two exceptions. The hon. Member for Huddersfield (Mr. Sheerman) left it until the last gasp of his speech, and then mentioned it only in passing when he said that the Labour party wants local authorities to encourage enterprise. We appreciate that local authorities play a part, but they should not take the lead. As my hon. Friend the Member for Bradford, North (Mr. Lawler) said, we must stimulate and develop enterprise this year. Those whom we are trying to encourage—the Government and local government — represent the acceptable face of bureaucracy, and we ignore that at our peril.
My hon. Friend the Member for Saffron Walden mentioned the opportunity that this year offers. He wanted an improvement in the interface between industrialists and

681
educationists. The initiative of the Royal Society for the Encouragement of Arts, Manufactures and Commerce is to be welcomed and encouraged. It has the support of the Government, the Confederation of British Industry, the Trades Union Congress, professional organisations, the churches, women's groups and many others who perhaps realise, as I do, that we should have done this 30 or 40 years ago, as my hon. Friend the Minister of State, Education and Science said.
It is widely accepted that, irrespective of whether we like it—we do not—there is in Britain today an anti-industry, anti-enterprise and anti-profit culture. Things have improved considerably while the Government have been in office—we can point to clear evidence of that. However, we do not pay sufficient regard to industries that provide the wealth that pays for the essential services that we have come to accept such as better schools, hospitals and roads. The strand that joined the speech of the hon. Member for Portsmouth, South (Mr. Hancock) and Labour Members, when outlining the fantastic programmes that they say that they will get involved in—they say that they will throw the cheque book at every problem—is that they never spell out the detail of their programmes or say where the money will come from.
Industry Year is designed to start to change cultural attitudes so that, once again, the most talented people will choose to work in industry. It is important to stress that the definition of industry being used this year includes tradable goods and services that people need and want. My hon. Friend the Member for Harrogate (Mr. Banks) rightly reminded us that we are not talking solely about manufacturing industry, but about the important service sector as well.
Mr. Mark Fisher: You never do.
Mr. Trippier: If the hon. Gentleman reads our White Paper on regional policy of nearly two years ago, he will see that we chose our words carefully. He will see that the grants that are made available, principally through the Department of Trade and Industry, have been confined to manufacturing industry—that we have discriminated in favour of the manufacturing sector. We signalled a change by saying in the White Paper that we would no longer discriminate against the service sector. We have wide support for that view, and so we should. We have looked across the Atlantic and seen where the new jobs have come from there. Growth, wealth creation, and employment creation have come principally from the service sector.
Mr. Holt: Did my hon. Friend see the Leader of the Opposition yesterday, speaking on television, when he said that his party is committed to introducing higher taxation for the very people who must be induced to go into industry to provide the entrepreneurial skill that we so desperately need?
Mr. Fisher: The top 5 per cent.
Mr. Trippier: I saw that programme. I was enthralled that the Leader of the Opposition referred to enterprise, which I welcomed. He said that there would have to be an increase in taxation—
Mr. Fisher: For the top 5 per cent.
Mr. Trippier: Quite frankly, the top 5 per cent. do not bring in the money necessary for the programmes that the Opposition are talking about. I cannot think of anything that would be more of a brake on enterprise or act more as a disincentive to those we are trying to encourage than the Government taking more of their earnings, with the result that the risks that they take are not adequately rewarded.
Mr. Sheerman: Does the Minister agree that we have witnessed the destruction of enterprise in the past six years? As I said in my speech, if the Government do not do something to resuscitate industry, constituencies such as the Minister's and mine, in which 45 per cent. of youth training scheme leavers go on to the dole queue, will have no employment to offer because there will be no enterprise. What will the Government do about that?
Mr. Trippier: There is not much of a debate on this issue because the Labour party's record in government is appalling. Its policies for entrepreneurs and enterprise were non-existent. The hon. Gentleman is supposed to be my shadow opposite number, including my responsibility for small firms, and I find it extremely difficult to stomach the fact that the Labour party has not mentioned enterprise or small firms in either of its last two manifestos. It has no interest in encouraging such activity.
The Industry Year message must be put across strongly to the education sector. The generation in education now is that from which most of our future entrepreneurs will be attracted. However, the attitude of parents is important, and the Industry Year message is aimed at them, too. There is little point in persuading students to look to industry for careers if their parents still try to steer them towards the so-called softer options, which at the moment unfortunately assume higher status. Parents must be convinced of the importance of industry and enterprise. We hope that companies will hold open days for the local community so that everybody can understand and appreciate how much industry contributes to the local and national well-being.
It is essential that companies and schools form closer links, perhaps by companies adopting a local school. This is a two-way process. Students can learn about industry, and companies would be able to contribute and perhaps alter the learning process so that children develop the right skills. I should like all school leavers to be able to understand a simple business plan and a balance sheet. I wish that I had received such training at school.
I am not convinced about tax allowances for industrialists, but that is obviously a matter that I should have to refer to my right hon. Friend the Chancellor in any event. I tend to agree with colleagues who answered that argument. It is far better to encourage people to come in from industry to speak in schools. That is improving all the time. The Department of Education and Science and the Department of Trade and Industry are involved in promoting knowledge of industry among schoolchildren through the industry education unit in the Department of Trade and Industry, which is running an interesting scheme called the mini-enterprise in schools project, in conjunction with the National Westminster bank. The target is to have at least one mini-enterprise in every secondary school by the end of Industry Year. That is quite a target—there are about 7,000 secondary schools—but at least 30 per cent. are already covered. The projects give

683
youngsters an opportunity to understand the pleasures and pitfalls of business life while at school. It will give them a good understanding of enterprise.
I warmly welcome what the hon. Member for Huddersfield said about the youth training scheme. This is the first time that I have heard it said publicly that the Labour party broadly — I am not taking the hon. Gentleman's words out of context—supports YTS. I do not want there to be a partisan attitude towards the scheme. The hon. Gentleman knows that members of the TUC are commissioners of the scheme. It is a first-class scheme and has helped many youngsters to find full-time employment. It is the best youth scheme that we have ever introduced.
Thanks to my hon. Friend the Member for Saffron Walden, we have had an opportunity to discuss the issues early this year. I hope that the message of this important year will be understood, and that its relevance to young people will better equip them for the challenge and opportunity offered to the nation in future.
Question put and agreed to.
Resolved,
That this House calls for future policy towards 14 to 19 year olds to be based on a close integration of education, training and the Youth Service, taking full account of the aims and objectives of Industry Year.

Channel Tunnel
Mr. Speaker: Before I call the Secretary of State for Transport, I should announce that I have selected the amendment in the name of the Leader of the Opposition.
As a long list of right hon. and hon. Members wish to participate in the debate, I intend to give priority to those who were not called when we last debated this important matter on 9 December.
7 pm
The Secretary of State for Transport (Mr. Nicholas Ridley): I beg to move,
That this House approves the Government's White Paper on the Channel Fixed Link (Cmnd. 9735).
I am delighted, but surprised, that the Opposition want this debate on the Channel tunnel. I am delighted because many of my right hon. and hon. Friends have important points to raise, and surprised because I do not understand what the Opposition seek to gain. Perhaps they want to embarrass the Liberals, as the hon. Member for Isle of Wight (Mr. Ross) is in favour of our decision, but the Liberal candidates in east Kent are all against it. That is strange. The Liberal manifesto for the 1984 Euro-elections advocated
"Community Investment in major transport links, including a Channel Tunnel".
I wonder whether the Kent Liberal candidates dissociated themselves from the manifesto at the time of the campaign.
Mr. Stephen Ross: I continue to support our manifesto, and the Secretary of State congratulated me on that recently during Question Time. I suspect that some Conservative Back-Bench Members are not keen on the scheme.
Mr. Ridley: I am not criticising the hon. Gentleman. I was merely wondering whether he could have a word with some of his candidates.
The Labour party also has its problems. Some Labour Members are in favour of our decision, and some are against it. So why choose to debate it? It puts the hon. Member for Aberdeen, North (Mr. Hughes) in a terribly embarrassing position. He must steer between the Scylla of the hon. Member for West Bromwich, East (Mr. Snape) who represents the National Union of Railwaymen, and the Charybdis of the hon. Member for Kingston upon Hull, East (Mr. Prescott), who represents the National Union of Seamen. It is beastly of the Labour party to make him run the gauntlet again between those two political rocks. Surely he found it unpleasant enough the first time.
But the Labour party has a worse failure to answer for. Labour Members keep demanding more infrastructure spending. They have debate after debate about the need for spending, and more jobs. Indeed, there is another one this week. Yet here is a massive infrastructure project, which will create a great number of jobs—we estimate about 40,000 man-years of employment. The jobs will by no means all be in the south-east. There could be orders of £700 million to £800 million for railway equipment alone which can be fulfilled only by midlands and northern firms. There are also great opportunities for more employment on railway operations. The tunnel will bring benefits to all regions of the kingdom by providing quicker, cheaper, more reliable means of transport to the Continent, thus helping employment. But what does the

685
Labour party do? It voted against the tunnel before Christmas, and it has a three-line whip to vote for its amendment tonight. Does it want jobs, and infrastructure, and investment, or not?
When I announced the invitation to promoters last year the hon. Member for Crewe and Nantwich (Mrs. Dunwoody), who was then Labour's transport spokesman, said:
"We welcome any suggestion of considerable investment in the infrastructure. Indeed, we have been asking the Government for many years for precisely this sort of infrastructure development, with its impact on jobs and industry."—[Official Report, 2 April 1985; Vol. 76 c. 1078-79.].
How can the Opposition say that with one transport spokesman, and with another ask the House to vote against the project that they welcomed? The Labour party's inconsistency is extraordinary, although some individual hon. Members hold different views.
Mr. Robert Sheldon: The main point is that the infrastructure development will assist the south-east. Many of us are worried that the White Paper pays no regard to transport links with the north. The bottlenecks around London will become more constricted, not less, as a result of the link. Expenditure is needed on the road network to the north, but that will be even harder as a result of the Channel link. The right hon. Gentleman should be providing better links to the north, not to London.
Mr. Ridley: I know that the right hon. Gentleman is in favour of the link and sees the importance of connecting it to all areas, and I entirely agree. For that reason we are building the M40 as a relief to the Ml. It is as quick to go from London to Birmingham up the M6 via Oxford as it is via the Ml. There is massive infrastructure development taking traffic from the south-east to all quarters. There is a huge road programme to the south-west. Wherever we can, we are investing in roads to improve the position. Moreover, there are great opportunities for the railways to run through services from the north to the Continent. The right hon. Gentleman must welcome our decision and encourage all concerned to grasp the opportunities.
Mr. Teddy Taylor: What evidence prompted my right hon. Friend to make the statement that the Channel tunnel could offer a "cheaper" means of transport across the Channel? Does he accept that the more British people hear about the tunnel, the less they like it? That is clear from a recent opinion poll which shows that more than half the population do not want the tunnel, and that only one third are in favour of it.
Mr. Ridley: First, the magic has worked even quicker than I believed because the ferries are now saying that they will cut the cost of the journey by 30 per cent. That is even before the tunnel is built. Therefore, my hon. Friend must concede that the tunnel route is cheaper. That shows what a little competition can do. Secondly, if my hon. Friend intends to steer a course according to every favourable opinion poll, I do not know what he will do when they are unfavourable. That is not a sound basis for forming opinions.
There is another dilemma. The Labour party complains that all the benefits of the tunnel will go to east Kent, and not to the north of England. But my right hon. and hon.
686
Friends from Kent have expressed the opposite concern, that the tunnel will have unfortunate employment effects on the county. Let me tell the House my view of the truth, which is also contained in the White Paper.
For the next eight years, during the construction period, there will be growing employment in Kent, both because of the increasing ferry business, and the construction work on the tunnel, roads, railways and so on. There could even be a shortage of labour during that period. In the long term, after the tunnel is open, a great deal depends upon the extent to which it attracts traffic which would otherwise be carried by the ferries, and also upon the extent to which local authorities in Kent can use, imaginatively, the opportunities created by the link to generate new employment in the county. When the link opens, employment on the ferries will certainly fall. On the basis of the promoters' estimates of traffic, the Government judge that the total direct employment on cross-Channel transport operations will be some 1,500 less than it is now. But thereafter, employment will rise again, both on the link and the ferries. Moreover, there will be jobs from associated developments, so I suggest that the truth is that the long-term employment effects are fairly neutral.
Mr. Andrew Rowe: My right hon. Friend will be aware that there is anxiety in the Medway towns that the very considerable infrastructure improvements to cope with the direct effects of the fixed link may militate against the essential project which the Medway towns are proposing to improve what is almost the blackest unemployment spot in Kent. Will my right hon. Friend reassure the Medway towns that he will look with considerable sympathy upon their proposals for a third Medway crossing?
Mr. Ridley: The M20 is the main road to the Channel ports and will be the main road to the Channel tunnel. That road will be developed to three lane motorway standard irrespective of whether there is a Channel link. Traffic going to the Channel ports will be so great that it will demand that upgrading in any case. Building the link does not add to the road programme in respect of that road as that road is already allowed for in the programme. In no sense is money being taken from other parts of the road programme because of the decision on the fixed link.
I have already said that we shall look extremely sympathetically at any other roads needs which arise in Kent because of the link, and the discussions are already planned to start such an investigation.
Mr. Jonathan Aitken: Before my right hon. Friend leaves the employment consequences which he said would amount to a loss of only 1,500 jobs at the ferry ports, I draw his attention to the fact that that figure is based on what, by the White Paper's own admission, is a most misleading basis. The White Paper bases that calculation on two ferry ports only, Dover and Folkestone. My right hon. Friend must know that there are well founded fears in at least 15 ports up and down the country, including the second largest Channel port, Ramsgate, which is not mentioned in the White Paper. One would not base a calculation on test cricket on the basis of what happened at Lords or the Oval and make no mention of Old Trafford, Headingley, Trent Bridge, and so on.
Mr. Ridley: I was a little confused about the last part of my hon. Friend's intervention and I confess I do not see the relevance of that, but the figure I gave was based on the estimates of tunnel traffic made by the Channel Tunnel Group. That includes the whole of the ferry industry, not just the two ports that my hon. Friend mentioned. We believe that some ferry ports will increase employment as the link opens rather than reduce their employment. I cannot give my hon. Friend detailed figures for every port. I would have to have the wisdom of Solomon to say what will happen, but my hon. Friend knows my views about the future of Ramsgate.
Mrs. Ann Clwyd: I recently wrote to the right hon. Gentleman to ask if his Department had estimated the effect which the Channel tunnel would have on the container ports. He replied that that information was confidential. How is it possible for container ports to plan for the future if they do not know what the tunnel's effect will be on their trade?
Mr. Ridley: That is true of all industrial enterprises at all times. When the west coast ports lost business to the east coast, nobody was able to warn them or provide any precise estimates. That is normal business risk. It is quite impossible to make a detailed forecast of the effect on every port.
The White Paper sets out the reasons for our choice of the Channel Tunnel Group's scheme. This was the joint choice of the British and French Governments. Both Governments would have liked to see a drive-through scheme, but the uncertainties and risks of all three drive-through alternatives led us to believe that there was a risk that they might prove too expensive to finance. I repeat that no Government funds or guarantees will be available. The CTG scheme appeared to the Governments to offer the best prospect of proceeding to completion. It has other advantages as well and these are set out in detail in annexe B of the White Paper.
The main purpose of the White Paper is to look forward. It is not the job of the Government to set out the virtues of the CTG scheme and its potential attractiveness to customers and therefore to investors. That is for the promoters to do over the next few months as they set about raising the capital. We believe the Channel tunnel will greatly enhance the choice for travellers between Britain and France by adding to the existing air and ferry options a shuttle service for road vehicles and an efficient city-centre to city-centre rail link. For road travellers, the shuttle link will reduce the crossing time, with all stops included, by well over half compared with the ferries.
The rail link from London to Paris and Brussels will be very competitive with air transport. These are great benefits. Already, there is talk of reducing fares in order to compete. That, too, is excellent news. The Government's task is solely to consider the impacts of the scheme upon the transport network, and the environment.
Mr. Roland Boyes: Surely the Government's task is to consider the impact on employment. Paragraph 39 of the White Paper states:
"Firms in the East and West Midlands will be well placed to compete for contracts to build the shuttle trains, and there are firms in Scotland and the North-East able to supply construction materials."
As the Minister knows full well, I believe that the Channel tunnel will have a negative effect on jobs in the north-east. We shall lose jobs as a consequence. It might
688
help the situation if the Minister can give me a guarantee that the construction materials that firms in the north-east are able to supply will be the ones which the tunnel builders will order or will the Minister say that it is a free for all where the construction firms can shop around the Continent and the world and get their goods at the cheapest price?
Mr. Ridley: I have already dealt with the employment aspects. If the hon. Gentleman did not hear what I said, he can read it in Hansard. I made it clear what the employment consequences are likely to be. I said that in my opinion the jobs which will go to the midlands, the north and Scotland were considerable as there were £700 million to £800 million worth of railway orders alone to go, as well as the building material orders to which the hon. Gentleman referred. He knows full well that I cannot promise that those orders would go to any particular firm. His constituents have the opportunity to gain employment if they can win these contracts. I am certain that they have a very good chance of doing so.
I was about to describe the effects on the transport network. British Rail is to invest between £290 million and £390 million in rolling stock, the Waterloo terminal and certain other limited improvements between Folkestone and London. The impact upon the roads programme in the foreseeable future is not large. The Government's proposals for the M20 from London to Folkestone are already in the programme and would be necessary whether a fixed link were built or not. We shall also press ahead as fast as possible with the replacement of the A20 between Folkestone and Dover. We shall also consider with Kent county council what improvements to local roads may be necessary.
The environmental impacts of the Channel Tunnel Group's scheme are set out in some detail in the appraisal by Land Use Consultants and their associates of the promoters' environmental impact assessments. That is a valuable independent report. It does not necessarily represent the Government's views on all points, but it forms the basis of the Government's assessment of the environmental aspects of the further work that needs to be done. It quite deliberately looks far into the future.
It is not surprising that if one looks 30, 40 or 50 years ahead, the M20 may need to be widened to four lanes in each direction. It will not, by any means, be the only motorway requiring such treatment by then. It would be for our successors to deal with these problems. In the short term, however, our concern is to make the scheme environmentally as acceptable as possible, in matters such as the arrangements for the disposal of spoil, the workings at the foot of the Shakespeare cliff, the landscaping of the Cheriton site, and the arrangements for the construction of the tunnels under Holywell Coombe.
Mr. David Howell: Does my right hon. Friend accept that one of the important impacts could be the attraction of freight away from the roads and back to rail when the Continental freight network is linked with the British network and substantial savings are achieved? Has he received any more recent estimates of the impact of that change, and does he recall that an earlier estimate was that only about 250,000 tonnes of road freight would go to rail? Will he comment on whether that is rather an underestimate? Does he agree that it might be considerably

689
more than that, with great benefit for the environment generally and a reduction in the number of heavy lorries rolling through villages?
Mr. Ridley: My right hon. Friend is entirely right. I speak without having a figure before me, but I think that the latest estimate is that there may be a fivefold increase in the amount of freight that the railways carry across the Channel as a result of the project. If I have misremembered the figure, I shall correct myself in writing to my right hon. Friend. There will be a considerable increase.
We have retained the right to require the promoters to investigate and then implement the most acceptable arrangements, and the promoters accept this. My right hon. Friend the Secretary of State for the Environment and I intend to work closely together on this and my hon. Friend the Minister of State, Department of Transport will be consulting locally in Kent about it. If he is fortunate enough to catch your eye later, Mr. Deputy Speaker, he will describe the plans for consultation.
With the tunnel becoming nearer to a reality, the natural conservatism of the British people is coming to the fore. Will rabies come? Will the Russians invade along the tunnel? Should Britain not remain an island? I sympathise with these emotional arguments, but I do not believe that they are rational. I shall conclude by answering the most frequently asked question, which is "Do we really need a tunnel?" Those who do not want to use it need not do so. Nor will they be asked to pay for it. But if millions want to use it and pay for using it, whether they be tourists, businessmen, importers or exporters, what right have we to stop them? It is for the Channel Tunnel Group to persuade the investors that we need a tunnel. If it considers that it should be built and is ready to pay for it, I do not think that the House would want to stop it.
Mr. Jim Craigen rose—
Mr. Ridley: I shall not give way. I must bring my remarks to an end.
It is remarkable that the two Governments were in the invidious position of having to choose between four schemes. All were well prepared and those behind them were prepared to raise the money and to take the risks. What a transformation this is from the drab, centrally planned, Socialist concept of soak the taxpayers and ram it down their throats because the gentleman in Whitehall knows best. It is a sign of the virility of our entrepreneurs, our economy and our engineers that we can give the Channel tunnel the green light.
7.24 pm
Mr. Robert Hughes: I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
'whilst accepting that the Channel Tunnel Group-France Manche scheme may have the potential to encourage the development of modern British Rail network and bring benefit to some parts of the country, declines to approve the White Paper "The Channel Fixed Link", Cmnd. 9735, without full knowledge of the terms of the Treaty and its Protocols, without any Government commitment to necessary financial assistance to British Rail, without any Government plans to maximise the opportunities for industry and communities away from the immediate location of the Fixed Link, and without the Government accepting responsibility for and safeguarding against the damaging employment implications of the scheme, or providing adequately for the rights of those affected by the decision to have their views
690
taken into account; and recognises that the proposals present a threat to consumer choice in crossing the Channel with the creation of a private monopoly with its implications for prices and charges, without the guaranteed continuation of port and ferry facilities.'.
Three hours to debate what has been described as a historic decision is far too short a time. I apologise to the House in advance if I do not give way to interventions as frequently as I might have done. There are a lot of issues to be covered, many of which were not covered by the Secretary of State.
In the speeches and statements and in the White Paper, the Secretary of State repeats that the Charnel tunnel is an imaginative and exciting project. He has waxed eloquent about the job creation factors of the scheme and the benefits that he hopes will accrue. When he has been asked pertinent and penetrating questions, he has replied, "All will be revealed in the White Paper." We have the White Paper now and there is little in it, if anything, which could not have been put before us a fortnight ago. There is nothing in it which could have delayed its publication for a few days, as the right hon. Gentleman said, but which became a fortnight.
We accept that the CTG-FM scheme is the best of the schemes that the Government examined. In our view, it suits our transport needs and provides opportunities for British Rail. We believe that it could allow the benefits for some parts of the country to be distributed more evenly. If we were starting afresh to consider job creation schemes, we might well not start from where we are now. However, we are starting with the Government's decision, and we have a responsibility to ensure that the best outcome is achieved. We have tabled a positive amendment, and we are not defensive about it.
The problem is that the Secretary of State, having made a decision—or having had it made for him—wishes to cut and run. He wishes to avoid responsibility for developments that are damaging to the economies of various parts of the country and for the necessary planning to maximise potential benefits. He has prepared his alibi well in advance. In page 2 of the White Paper there is an all-embracing disclaimer which appears as a footnote:
* The Government expressly asserts that it makes no representation, either express or implied, as to the viability of the project with any intention or desire that such representation be relied upon by any investor. It should be noted that, in this White Paper, estimates of CTG-FM's financing needs are their own, and the impacts of the CTG-FM scheme — on employment, the environment, the merchant fleet etc.—are all based upon the promoters' estimates of traffic.
I cannot recall seeing such a massive cop-out in any other White Paper. We shall press the Secretary of State to accept the figures and to take the action appropriate to them.
The treaty is due to be signed on Wednesday. It is unfortunate that the White Paper gives us only the broadest outline of what the treaty contains. We are merely told in paragraph 50 that the treaty
"will also enshrine the private sector nature of the link and the concessionaire's right to compensation in the event of political interference or cancellation by either Government."
Can we not be told, less than two days before the treaty is signed, what the financial penalties are that the Government have negotiated? Why are we being asked, in effect, to buy a pig in a poke? Surely the Prime Minister will not sign a blank piece of paper in Canterbury in less than 48 hours from now?

691
Paragraphs 53 to 60 tell us that negotiations will continue on the concession agreement and that the final package will contain the freedom to set tariffs, subject only to the European Community's and the Government's rules on competition. These and many other issues need to be clarified.
I was disappointed when the Secretary of State told us that he would leave the consultation arrangements to be dealt with by his hon. Friend the Minister of State, Department of Transport when he replies to the debate. The White Paper suggests what will happen. The Secretary of State from the beginning ruled out a formal public inquiry. In earlier debates he has asserted that the hybrid Bill procedure gave better opportunities for those affected to canvas their concerns, and it is clear in the White Paper that he has conceded his failure to convince a wide section of opinion in the House. Equally, he has failed to satisfy the doubts of many interests in Kent, for example. In paragraphs 46 to 48 he attempts to present a more convincing case and to answer the many representations that have been made on consultation.
I shall deal with paragraph 48 in some detail. It seems that an extra statutory authority of planning machinery is to be established between the Government, the Kent county council and the other local authorities concerned. We understand that the committee will be chaired by the Minister of State and that the Parliamentary Under-Secretary of State for the Environment, the hon. Member for Mitcham and Morden (Mrs. Rumbold), will be involved in discussions. I note that the hon. Lady is in her place.
We are told in paragraph 48 that there will be widespread consultations. It adds:
"Among the subjects to be considered by the committee will be the adequacy of the road system in Kent to cope with the traffic flows expected to follow the building of the link, and specific local economic and environmental problems that may be caused by the development of the link. As one of its first tasks the committee is expected to commission a more detailed study of the potential impact on Kent of the CTG-FM scheme both during and after construction. This is to be carried out with the widest possible consultation of relevant interest groups in the county."
So far so good, but what will be the result of the consultation? Everyone knows that there will be economic dislocation of the local economy. That appears not to be in doubt.
Paragraph 41 makes it clear that 7,000 jobs will go in the ports and ferries if the promoters' forecasts are accurate. Several questions follow from paragraph 48. To whom will the consultative committee report? When will it report? Who will carry out the detailed study of the potential impact on Kent? A responsible Government would have carried out those studies before, not after, taking a decision in principle.
Further questions will have to be posed. Will the consultation group make recommendations? There would seem to be no point in having such a formal machinery, nor in commissioning these studies, unless the schemes are drawn up and acted upon. Will the findings of the consultative group be finalised and incorporated into the drafting of the hybrid Bill? What will be the effect of the consultations on those who may wish to petition the Select Committees which are due to be set up under the hybrid Bill procedure? If any of those affected by the scheme take part in the consultations, will they be prevented from gaining access to the Select Committees?
692
Paragraph 62 of the White Paper sets out the hybrid Bill procedure and attempts to define the term locus standi. In paragraph 62, the Minister, trying to assuage the feelings of his Back Benchers, says:
"However, the Government, as sponsor of the Bill, will not seek to oppose the right of anyone to appear before the Committees on a petition to secure protection, either for their personal interests, or for the proper interests of any organisation or group which they may have been appointed to represent."
The use of the word "proper" seems to be a heavy qualification on who will go before the Select Committees. Will the Secretary of State give a categorical guarantee that appearance before the consultation group or submission of objections to it will neither prejudice the right of petitioners to appear before the Select Committees nor extinguish those rights? Unless these questions are answered fully, the consultative machinery will be seen as nothing more than a gigantic public relations exercise and a hoax on the public.
At the heart of our concern is what will happen not just to the south-east, but to the rest of the country. If the economic benefit is to be distributed about the country, British Rail must be given the opportunity to develop its services and to have its infrastructure, its motive power and rolling stock ready for the opening of the tunnel. Therefore, I welcome the British Rail press statement, issued on 4 February, in which it explains how it intends to run through-trains from different parts of the country and hopes that there will be discussions with immigration and customs officials to have these facilities carried out on the train, although there seems to be some doubt as to whether those bodies will co-operate.
British Rail, in its press statement, appears to be thinking ahead, even if the Secretary of State is not. If the required investment is made available, it will give a boost to British Rail's estimates of both freight and passenger services; and if the money is spent in the United Kingdom, jobs will be created. However, I dispute the Secretary of State's assessment of when the investment needs to be made available and whether his policy towards British Rail is adequate to match its requirements.
At Question Time on Monday 3 February, in column 6, I asked the Minister to give an assurance that British Rail's external financing limit would be expanded to accommodate Channel tunnel-related expenditure and that other BR expenditure would not suffer. It astonished me when I was given such an unequivocal "Yes" to that question. However, in a subsequent answer in the same column, he back-pedalled very fast and said that BR's EFL would be smaller during the period 1990–93 in any event. If that means that the investment and infrastructure will be in place before that time, we might accept it. However, I suspect that the opposite is the case. I believe that investment in BR must be expanded, even if the Channel tunnel is not to go ahead. If passengers and freight traffic are to be encouraged back to the railways, then BR's customer image needs to be enhanced throughout the entire network, and not just that part that is related to the Channel tunnel service.
The Government must put money into BR. The White Paper concedes that there will be public spending associated with the tunnel. That much is evident from paragraphs 29, 30 and 31. There is a little hedging in paragraph 31, which says:

693
"The Government will give sympathetic consideration to supporting with Transport Supplementary Grant proposals from the County Council arising directly as a result of the fixed link project."
We know with certainty that public money will be going into roads development. Why, then, will the Government not do the same for British Rail? Paragraph 27 makes it clear beyond any doubt:
"It will be for BR to raise the money for this"—
that is all the investment about which we have spoken—
"as for all its investment programmes, out of its own resources or borrowing, and not by way of Government grant."
Nothing can be more clear that the Government will not put any money in.
In paragraph 66, the Minister expresses his hopes in this way:
"The Government has high hopes of seeing the link built and of it becoming a valuable national asset serving the interests of the nation for many years to come."
I should like to see those high hopes come to fruition, but they will remain just pious hopes unless there is positive Government intervention.
I commend to the House the latest issue of Town and Country Planning. In an article called "Where have all the planners gone?", Andrew Thorburn says:
"So far, no one has sketched out the consequences for Britain of the funnelling of traffic through this small corner, and the extra traffic likely to be stimulated … Never has the need for proper regional planning been more apparent.
Some have felt that we can get by without this in times of recession when little is changing, but the construction of the largest infrastructure provision in Britain's history will require the rethinking of many development and investment policies, and rural conserveration policies, as well as a review of the transportation services throughout the south east. Where is our machinery for this?"
I concede that that was written about the south-east of England, but it is of equal relevance to the country as a whole. The Secretary of State will have nothing to do with this. His view is that if everything goes well, the scheme will be a success; and, if it does not, he is simply abrogating his responsibility in advance. He is like an old lag in a Scottish court pleading the special defence of "incrimination" or "impeachment". He is saying, "It wasn't me who did it; it was someone else. It was market forces that did it."
Without proper planning, investment and regional development, the nation will come to regret the decision and wonder what went wrong. The Opposition have a duty and a responsibility to the nation to seek to remedy the failings of the Minister and of the Government. We shall press the Government for as long as we are in opposition, and we shall discharge our responsibilities and duties to the nation when we become the Government. I commend our amendment to the House and invite right hon. and hon. Members from both sides of the House to join us in the Lobby tonight.
Several Hon. Members rose—
Mr. Deputy Speaker (Mr. Harold Walker): I point out the obvious—that a large number of right hon. and hon. Members want to take part in the debate. The shorter the speeches, the fewer will be disappointed.
7.38 pm
Mr. Peter Rees: I shall endeavour to obey your injunction, Mr. Deputy Speaker, and I hope that the
694
hon. Member for Aberdeen, North (Mr. Hughes) will forgive me if I do not follow all the interesting points that he made. I admire the delicacy with which he has tried to reconcile the interests of various regions of the kingdom and, in particular, the interests of the National Union of Railwaymen and the National Union of Seamen. My hon. Friends may wish to explore that further.
I was interested to notice that the hon. Gentleman said that, of the four schemes, this is the one that he would prefer. I am ready to admit to my right hon. Friend the Secretary of State that of all the four schemes, this is likely to do the least damage to the economy and environment of east Kent. I was reassured that the environmental point had been made by the Countryside Commission and the Nature Conservancy Council. However, I must emphasise to my right hon. Friend the deep and continuing concern of Dover and east Kent about the project, even though matters have moved on since 9 December.
I appreciate and am grateful to my right hon. Friend for his sensitive response to the points made by me and by some of my hon. Friends who represent Kentish constituencies relating to consultation. I appreciate the setting up of a consultative committee which is to be chaired by my hon. Friend the Minister of State. I note that it will be sited at Maidstone. That is appropriate in the first instance, because Maidstone is the seat of the county council. However, I hope that this will not rule out meetings at Dover and Folkestone, which I am sure would be welcomed by my hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard) who, ever assiduous in his championship of his constituents' interests, is sitting in his seat tonight. We are sorry that the conventions of Government deprive him of the opportunity to make a direct contribution to the debate. I hope also that the consultative committee will not rule out direct, bilateral contact between the Dover and Shepway district councils and the Department of Transport upon matters that are of prime concern to them.
The point is well made in paragraph 64 of the White Paper that this is the largest civil engineering contract for many years. This may be a matter of congratulation to some, but naturally it is a matter of concern to those who will be most directly and immediately affected by the project. It is important that complaints by local people should be quickly and impartially assessed and remedied. I warmly associate myself with my hon. and learned Friend the Member for Folkestone and Hythe, who feels that these complaints should be assessed by an independent person, possibly from the Department of Transport—a local ombudsman, if you will, who would be on the spot for the purpose. When my hon. Friend the Minister of State winds up the debate, I hope that he will say that he is giving careful thought to this possibility.
The main environmental impact will be felt at Cheriton, in my hon. and learned Friend's constituency. I have no doubt that he has been and that he will continue to be assiduous in taking up the points that concern those who live in the area. However, there is a little friendly rivalry between my hon. and learned Friend and me. There will be a considerable impact on Dover. I refer in particular to the working platform that is to be set up beneath the Shakespeare cliff and to the disposal of soil there and at other places. I am glad, therefore, that my right hon. Friend the Secretary of State has referred back to the consortium the problem of soil disposal. I hope that this

695
important and sensitive matter will be discussed either by the consultative committee or bilaterally with the Dover and Shepway councils.
I do not wish to carp, but competition is dealt with all too briefly in paragraphs 2 and 4 of the White Paper. It merely states that there will be fair competition and that the matter will be governed by English and European Community law. I seek, therefore, three assurances from my hon. Friend the Minister of State, although I appreciate that some of them do not lie exclusively within his responsibility. First, I seek an assurance that predatory pricing under these legal systems will be ruled out. Secondly, I seek an assurance that he is satisfied that the United Kingdom Government and the European Commission would be able to move quickly enough if unfair competition were to develop in the Channel. Thirdly, I seek an assurance that he feels that there will be a continuing place for ferries operating in the Channel from Dover and Folkestone. I believe that there is both a national and a Kentish interest in the continuance of their operations.
The economic and employment impacts upon east Kent were touched upon, perhaps too lightly, by the hon. Member for Aberdeen, North. This is where there is the greatest uncertainty for the people of east Kent, and it is the largest gap in the White Paper. Paragraph 41 admits frankly that there will be fewer direct jobs in east Kent with the link than without it, but there is no consideration of alternative sources of employment, except rather briefly in paragraph 41, which refers to
"new jobs in ancillary industries."
This may be a matter primarily for other Departments, but it is important that there should be evidence of deep thinking taking place on this subject now. It cannot be left for six, seven or eight years. Evidence is needed that thought has been given to the possibility of setting up enterprise zones, to the granting of assisted area status, and to the provision of a free port, or free ports, in east Kent. I should like thought to be given to the future of the port of Dover as a container terminal so that it can be built up to compete with Rotterdam. It tells heavily against previous Governments that Rotterdam has managed to catch, in fair competition, so much of the business that should have come to United Kingdom ports.
According to all accounts, the French are pouring money, as they are quite entitled to do, into the Pas de Calais and the surrounding département. I am the first to recognise the constraints upon public expenditure, but I should like to know what positive steps the Government are considering to assist east Kent to maintain its position against the competing attractions of north-west France.
I am sure that the House will not feel that I have dealt in too summary a fashion with this important issue. I hope that my constituents will not feel that I have done so. However, they will recognise that many other right hon. and hon. Members wish to take part in the debate. I have tonight voiced, I hope articulately, the legitimate concerns of my constituents.
I must also point out to the hon. Member for Aberdeen, North that the Opposition's amendment is rather bogus. It attempts to reconcile too many disparate interests. I recognise the difficulty of the hon. Gentleman's position, but I am sure that he will not expect me to support the Opposition amendment in the Lobby. It does very little, either explicitly or by implication, for my constituents or for the neighbouring constituencies in east Kent.
696
As for the motion in the name of my right hon. Friend the Secretary of State for Transport, unless and until the concerns that I have voiced are properly met I am bound to maintain the reservations that I expressed about the project in our debate on 9 December. My position in the Division Lobby tonight must reflect those reservations.
7.46 pm
Mr. John Silkin: When the Secretary of State rejected instituting an inquiry. he owed a moral duty both to this House and to the country to provide us with a White Paper that fully set out the Government's point of view. In fact, the White Paper is a very slim volume which skims over the important points. The most important question was put by the Select Committee on Transport in paragraph 128 of its first report. It said:
"The one question which has persistently hung over the committee's inquiry is 'Is there a need for a fixed link?' The committee has not received any very satisfactory answers to this question."
If it is trying to find the answer in the White Paper, the Select Committee can whistle for it. The nearest to an answer is to be found in paragraph 2, which says:
"The Government's policy for international transport is to increase consumer choice and promote efficiency by encouraging competition and innovation."
That is a splendid collection of words, but they mean exactly nothing. They do not explain why a fixed link does all these things or what the benefits will be. The White Paper, therefore, does not answer the question.
Then we thought to ourselves that if the White Paper does not contain the answer, perhaps the Secretary of State for Transport knows the answer. What did he say? I took down his words as he spoke them. He said that he was often asked whether we needed a tunnel, but he did not answer that question. He merely said, "If we do not like it, we need not use it." That is perfectly true. It is like a justification for murder. If we do not like it, we need not use it. That justifies it. That was the right hon. Gentleman's only contribution to the alleged need for a fixed link between Britain and France.
The Secretary of State dealt superficially, as does the White Paper, with the major points that are still at issue. First, there is the environment. During the debate on 9 December I deplored the fact that there had been no input from the Ministry of Agriculture, Fisheries and Food. I have to say that I was wrong. There slipped through the House of Commons, without anybody knowing it or being deeply aware of it, a rather important order. That order came into effect on 1 January 1986. It was a Ministry of Agriculture, Fisheries and Food order which reflected the licensing provisions under the Dumping at Sea Act 1974.
Heretofore under that Act if one was going to bore a tunnel a licence had to be applied for which might or might not be granted by the Ministry. The order in question says that no licence is required to bore a tunnel under the seabed. When I looked at the Channel Tunnel Group's prospectus, it did not seem that it would be economically possible to do the job that it was talking about on the figure quoted if they were going to dump the spoil — which, you will remember, Mr. Deputy Speaker, comes to 1 million cubic metres — onshore. But if that is to be dumped at sea, a different situation arises. That is the cheapest and easiest way of doing it, and that, incidentally, kills all the spawning herring, sole and plaice in the English Channel.

697
We heard—I do not want to go too far into it at the moment — the employment difficulties for Kent which the right hon. and learned Member for Dover (Mr. Rees) reiterated a moment ago. He is tolerant in thinking that he will get an answer. I doubt that he will. However, those of my hon. Friends who come from the north-east, Wales or Scotland who are worried about the effect of a fixed link across the Channel believe that Kent and the rest of the south-east will benefit at the expense of their parts of the country. I do not believe that any of them will benefit.
The truth is that, as the White Paper hints, there will be a permanent drop in employment in Kent and there will probably be a drop in employment in the rest of the country. The White Paper says that there may be some increased employment in ancillary industries. But, like the right hon. and learned Member for Dover, I too wait for an answer on that. Where are those ancillary industries? What will they produce? What employment will they have? I do not believe it.
There are many points that I could make, but other hon. Members want to speak and there will no doubt be plenty of time on other occasions to do so. However, I want to finish with one small but important aspect—security. In paragraph 2 the White Paper says:
"Historically, Britain's island status has often been an advantage. Today it is a practical and economic hindrance to closer links with Europe."
Some of us would dispute that concept anyway, but
"Historically, Britain's island status has often been an advantage"
is rather an understatement. The plain fact is that that island status has protected this island over the past 1,000 years. It is worth at least a thought or two.
We have seen the Government virtually destroy our fishing industry and cut down on our merchant shipping and they are now talking about a sufficient number of ferries for our defence requirements. No doubt they have a 1914 concept of taking soldiers across the English Channel to some vast trench system in France. By destroying the number of ferries that operate, they are doing the same as destroying our merchant shipping and fishing fleets—they are destroying Britain's capability to produce, as we have over the centuries, the finest sailors in the world. I hope that, if that were all that there were against the provision of a fixed link, it would be sufficient for the House to think again.
7.54 pm
Mr. Roger Gale: On 9 December the House took a decision in favour of a fixed link. Those of us who represent north-east Kent did not endorse that decision, but I have no wish to go over that again. It is left to us, representing our constituents, to make the best of what I have described as the least worse solution. In that context—
Mr. Robert Hughes: I am sorry to interrupt the hon. Gentleman, but the House did not take a decision in principle the last time we debated this subject. We divided on a motion for the Adjournment of the House, nothing more. The hon. Gentleman is entitled to do what he wants tonight.
Mr. Gale: If I may say so, the House might regard that as a bogus point. The matter under discussion and the vote were plain and properly interpreted.
698
In the context of the decision that has been announced, I am pleased that, of the four that were on offer, the Channel Tunnel Group has obtained the contract because, in its make-up that company represents some of the finest engineering skills in the world. I hope and believe that that company will pay considerable attention to the environmental effect that any construction will have on the beautiful countryside of Kent.
I have one small voice to raise from the heart of Kent, and I hope that it will not be a voice crying in the wilderness. On Wednesday my right hon. Friend the Prime Minister is to visit Canterbury. Were she to go a few miles further down the appalling Thanet Way, she would arrive in the Thanet towns, where we endure 27 per cent. male unemployment. That may be an inconvenient fact for my right hon. Friends on the Front Bench to acknowledge and it may be an inconvenient fact for the Government to acknowledge. It makes the political map look untidy. There should not be such unemployment in the prosperous south-east, but the fact is that there is.
My hon. Friend the Member for Thanet, South (Mr. Aitken) and I have been working hard for a considerable time to try to turn that situation round. We are faced with a declining agriculture industry, which was labour-intensive and is becoming less so, and, with a decline in the bucket and spade holiday, we need to provide facilities that the modern tourist requires so that we can regenerate our tourist industry. That is in hand.
The greatest asset that the Isle of Thanet has is the development of the port of Ramsgate which, in the past few years, as a result of vigorous marketing and tremendous courage on the part of the developer and the district council, has been attracting large numbers of tourists to the region. The demise of that port, not mentioned anywhere in the White Paper by name or in any other form, would be not only damaging but devastating to north-east Kent.
Thanet has created an enterprise agency and built up the East Kent Development Association, but we look to the Kent county council and the Government to provide us with the thing which we cannot provide in any way, shape or form—the infrastructure that we need if the port of Ramsgate is to develop.
My right hon. Friend the Secretary of State was good enough to visit Thanet early in December and, having experienced just a little of what we had to tell him, said that he would be willing to take the key road in the area—the Thanet Way—and trunk it. He told us, and has reaffirmed, that his Department would be willing to do that fairly swiftly. I understand that that decision is dependent upon Kent county council.
However, I am a little worried because there is no mention whatever of north-east Kent in the White Paper. Paragraph 31, headed "The UK Road Network", says:
"Kent County Council are studying improvements which may be needed to some County roads in the area as a result of the building of the fixed link; and they will be dealing with them under their normal procedures. The Government will give sympathetic consideration to supporting with Transport Supplementary Grant proposals from the County Council arising directly as a result of the fixed link project."
I hope that my right hon. Friend the Secretary of State will state firmly to Kent county council his belief that the Department should make that road a trunk route.
Kent county council should recognise the needs. In "Channel Fixed Link: Issues for Discussion by Kent

699
County Council", which was published in November 1985, Mr. W. H. Deakin, the county planning officer, wrote:
"The County Council's role is to identify the consequences of proposals for Kent, and to maximise the balance of advantage to the County."
He said that the council's objective should be
"to give East Kent the best chance of compensating economic activity and employment, by way of securing Government commitment to development incentives; this is especially important, considering the economic advantages possessed by the Region Nord-Pas de Calais in northern France, an area which already enjoys substantial national and European assistance, and which is planning to capitalise to the full on any economic potential of a Fixed Link, and against which Kent would be competing on very unequal terms."
Two weeks ago, I paid a visit to Nord-Pas de Calais when I had the opportunity to discuss the effects of the link with M. Dupilet, the Member of Parliament for Boulogne. He kindly gave me a document which, roughly translated, is entitled "Channel Fixed Link." That document was available to all those who attended a ceremony held in France on 20 January. It sets out, chapter and verse, exactly what the French Government are doing in Nord-Pas de Calais, how much they are spending and on what they are spending it in terms of ports with the development of Dunkirk, Calais and Boulogne, in terms of roads with the Boulogne-Dunkirk coast road and many others, and in terms of rail links from existing ports, not some new Chunnel terminal. We have no equal document available to us, because this point has not been considered.
I should like to ask my hon. Friend the Minister of State a few questions. I do not believe in pork barrel politics, but the Government cannot have it both ways. Either we create jobs or we are in the business of destruction. With respect, I do not think that my hon. Friend can ask turkeys to vote for Christmas. Does my hon. Friend recognise the need of north-east Kent. especially the Thanet towns? Does he acknowledge that the Chunnel will have a profound effect on those towns? Does he recognise the need for improved infrastructure, especially of the Thanet Way, the Thanet-Dover coast road and the Thanet-Ashford link? Does he have plans for the establishment of a regional council at ministerial, or at least Civil Service, level to ensure the development of the Thanet, Canterbury, Dover, Ashford and Swale districts, which together make up a region roughly the size of Nord-Pas de Calais? Unless the answer to all those questions is yes, I have a feeling that the fine words which no doubt will be uttered in Canterbury on Wednesday will have a ring as hollow as the Trojan horse.
8.2 pm
Mr. Stephen Ross: The hon. Member for Thanet, North (Mr. Gale) has done well to remind us that all is not gold in the south-east. His figure of 27 per cent. male unemployment is on a par with the figure in my constituency in the Isle of Wight.
I welcomed the Government's decision when the Secretary of State made his announcement on 20 January. I said then, and I endorse now, that, after various rumours and leaks to the contrary—when we thought we might get a road tunnel—the French and British Governments have chosen the scheme that has the best chance of succeeding. Certainly, if either of the two bridge projects had been favoured there would have been an even greater outcry from Kent citizens than at present, and it would have been fully justified.
700
I welcome what definitely appears to be an easing of the purse strings for British Rail. That comment appears in the White Paper, covering the years 1990–93, when it is accepted that British Rail's EFL will be exceeded—
Mr. Robert Hughes: No.
Mr. Ross: It is in there. That was also acknowledged last Monday by the Secretary of State when the hon. Member for Aberdeen, North (Mr. Hughes) asked him a direct question which I followed up. I hope that some common sense prevails. I hope that the Minister of State, who, I am glad, is keeping his portfolio to look after BR, will continue to press BR's claims for extra capital to carry out the programmes that are desperately needed. There is now a great opportunity for the Channel tunnel link to improve our railways.
Some people have queried with me BR's ability to run through freight services to the continent from various parts of the United Kingdom because of the differences in the loading gauge. The Sunday newspapers wrote a lot about this, including about the argument the other way around—that is, from France to Britain. British Rail's press release of 4 February is clear on this point. The hon. Member for Aberdeen, North quoted from it, but I shall quote from the last page, which states:
"Freight customers in the North, Midlands, Wales and Scotland stand to gain particularly from the link. Freight will be cleared at inland customs depots round the country. Fast and frequent services through the link will cut transit times significantly and rail's natural economic advantage with long haul traffic will help exporters to be competitive in reaching the markets in Europe."
It states:
"Twenty trains a day of containers and freight wagons in each direction will help to keep heavy vehicles off the crowded roads of the South East."
I assume that there are not insurmountable difficulties in dealing with the Berne gauge. That is the assurance. I suspect that there must be considerably more capital investment if we are to take full advantage of the opportunities to provide through freight services for Scotland, the north and the west of England.
I give notice that the alliance will consistently press that point. I hope that the Minister of State will ensure that more financial incentives for private rail sidings throughout Britain will be forthcoming. That would be a great help.
This is a marvellous opportunity to get substantial quantities of freight back on to rail and off our already overcrowded roads. We must take full advantage of it. What is more, construction of the link provides substantial job opportunities at British Rail Engineering Ltd., Metro Cammell and GEC, especially at the BREL factories at Derby, York and Crewe. Swindon will not get in on the act. I bitterly regret that as a long-time supporter of the old Great Western Railway.
Like many hon. Members, I have been lobbied consistently on the question of a public inquiry. In our earlier debate, I put forward a proposal, which was made to the Select Committee on Transport, for a strictly limited 20-day hearing on the vital issues as they affected Kent. I do not intend to press that again because I accept that it has deficiencies. On the whole, I think that the White Paper gives substantial reassurances.
Mr. Robert Hughes: I am surprised that the hon. Gentleman is dropping that proposal. The right hon.

701
Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) issued a press statement the day the decision was announced saying he would push that proposition forcefully. What has changed?
Mr. Ross: I have argued the point with the leader of my party. I was sure that the hon. Member for Aberdeen, North would pick that up. I told my right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) exactly what I thought. One cannot conduct just a 20-day hearing because every party, including Friends of the Earth and other environmentalists, will want to get in on it. I do not think that the hearing can be cut short. I believe that a 20-day hearing will leave everyone dissatisfied. The hon. Member for Aberdeen, North is correct—there is an internal argument on this proposal.
On the whole, I think that the White Paper gives substantial reassurances on the issue of consultation and the right to petition. Paragraphs 48 and 62 are especially significant. I am grateful to my colleagues on the Select Committee on Transport, especially the Chairman, the hon. Member for Sunderland, South (Mr. Bagier), for supporting my suggestion to the Committee some weeks ago that we should offer to take evidence in Kent. Last Wednesday, we went to Maidstone to take evidence from Kent county council. All three main political parties were represented and had their chance to make their point. Regrettably, that is not the case—I think that I take the hon. Member for Aberdeen, North with me on this—with the consultative committee which the Minister of State is to chair. The consultative committee is to comprise the seven districts and the county council, all of which are Tory controlled. That is a mistake which should be rectified. Surely the other party leaders on the county council and on Dover and Shepway councils—I am sure that we should say the lot—could be included without making the committee top heavy.
I personally accept the arguments against a full-scale public inquiry, but the hybrid Bill Committees must also be prepared to travel to take evidence in Kent. I remind the Labour party that, in 1974, the late Anthony Crosland reintroduced the Channel Tunnel Bill in its original form so that the petitioners would avoid abortive costs. Moreover, he made it clear that he did not think that a rail—only link without the shuttle was economically feasible. That was said in an answer to me on 3 April 1974.
As we have heard, Kent Members have been making clear the need for substantial expenditure on road infrastructure. An undertaking has already been given about the Maidstone bypass becoming a three-lane road, but Kent county council wants to see four lanes. The third Dartford tunnel will have to be constructed. The M25-M26 junction at Chevening needs attention. They are rightly anxious about the substantial loading facilities at Cheriton and the access thereto. The environmental problems have already been mentioned. There is a need to make much greater use of industrial land at Ashford. There is the problem of subsoil disposal. I understand that the material is no use for road construction.
I wish to make a brief constituency point. One of my constituents, Brigadier Hopthrow—he knows what he is talking about because he has been involved in water matters and gravel extraction for many years—has said that there is a rumour that the gravel required for the
702
Channel tunnel is likely to be dredged from the Channel east of the Nab tower. That would have a substantial effect on littoral drift and erosion on the Isle of Wight. We suspect that we have suffered a great deal from gravel extraction along the south coast and in the Solent. I make the plea that gravel should not be taken from my part of the world to construct the Channel tunnel.
A park-and-ride facility at a suitable spot on the M25 has much to commend it. Commuters from the Ashford area will need reassurance about their future services into London. I shall quote from the second leader in the Daily Telegraph last week. It is not a paper that I normally read, but I found this comment and I fully support it:
"If the Channel Tunnel Group, to whom time means money, want to get moving and keep moving, they would be well advised to set aside a substantial sum for damage limitation. If the county's defenders think that the money offered is not enough, it is up to them to demand more. If they want more landscaping, it is for them to demand it. The Government may be able to stay aloof from the finances of the Chunnel; they cannot dissociate themselves from the mess it makes. Usually it is the fate of those seeking to defend their patch to find themselves up against hard-faced bureaucrats in Government employ. In this instance, the bureaucrats are more likely to be on their side against the entrepreneurs. It is not a gift-horse to look in the mouth. Preservationist in East Kent should cheer up, limber up and prepare to make tough terms."
I could not put it better myself. We shall be supporting the Government tonight.
8.11 pm
Mr. Peter Fry: The hon. Member for Isle of Wight (Mr. Ross) is a fellow member of the Select Committee. I am pleased that he mentioned the M25 because one of the results of the White Paper on the Channel link will be tremendous pressure upon the roads around London. The M25 is overloaded before it has been completed. I hope that my hon. Friend the Minister realises that considerably more improvements will be needed in future for the many motorists who will be attracted to driving through the Channel link.
The right hon. Member for Lewisham, Deptford (Mr. Silkin) gave a somewhat selective quotation from the Select Committee's reports. He also made great play of the fact that a case for the Channel tunnel did not appear to be made out. At great length, the Opposition have tried to make it clear that they are not against the Channel link. They want to give the impression that they are vaguely against it so that all those who are opposed to any kind of link with the continent will think that they are doing a good job. In their long amendment, they have been exceedingly careful not to say that they are against the link. There is a degree of ambivalence in the Labour party's attitude.
Mr. Silkin: Perhaps I may reassure the hon. Gentleman that I am completely against the link.
Mr. Fry: I accept that.
I shall refer to the Select Committee's reports. Of the present Committee membership, only three were members of the Committee when we first embarked upon our lengthy inquiry in 1981. Despite the right hon. Gentleman's quotation, it is interesting to note that the reports in 1981 and just before Christmas came to the same conclusion. Even more surprisingly, the Committee came to the conclusion contained in the White Paper. The Select Committee agreed to the idea of a Channel link. It disagreed with the idea of a public inquiry and it recommended the scheme that the Secretary of State and

703
the Government have chosen. It must be unique at the moment for a Select Committee to chime in so thoroughly with Government policy.
Our fourth recommendation was that there should be a definitive vote of the House before the scheme proceeded. I should like to thank my right hon. and hon. Friends for giving the House that opportunity this evening.
It is interesting to know that it emerged from the Select Committee's investigations that those who are opposed to the Government's proposal can be divided into roughly three groups: first, those who are against any link; secondly, those who do not like the timing or the Government's method of approach; and, thirdly, those who do not like the scheme that has been put forward.
On the first point, it is ironic that some of the people who are against the Channel link are those who write to me saying how they object to so much of our freight being carried on the roads and not on British Rail. The Channel link has always been seen by British Rail as a major opportunity for it to take advantage of the length of carriage which this country lacks. That has always put British Rail at a disadvantage compared with many of its continental cousins.
The link will mean that for the first time British Rail can compete equally. It should have the opportunity to take many of the tonnes of freight that many of our constituents complain about because it obstructs our roads. British Rail has always been firmly in favour of the Channel link. For that reason alone, the link should be considered sympathetically.
There will be some people—I suspect they include one or two of my hon. Friends—who feel that we should not be linked to the continent in any circumstances. We all have constituents who have made that point. It is clear that the least disadvantageous of all the proposals is the one that has been put forward by the Government. The train tunnel can provide a link with the continent, but, what is more important, it will not destroy the ferry services. Not much has been said about that in the debate.
If any of the other schemes had been adopted, there would soon have been no ferry services between this country and the continent. That would have been against our national interest. It is all very well for the ferry companies now to say that they could be even more efficient and could cut fares in real terms by up to 30 per cent. but it has taken the threat of competition to bring them to that point.
The link will provide competition. There will be a choice. One can fly from Heathrow or Gatwick. The STOL port in London's docklands will soon be open and will provide another means of travel to the continent. Some ferries will undoubtedly still operate and we shall have trains going through the Channel link. The Government are providing a genuine choice for the travelling public.
The second group of people who object to the link is comprised of those who feel that there should be a public inquiry. A referendum has even been suggested. When I answered a radio phone-in programme the other day, I discovered that many of the people who object and want a referendum were under the impression that they had the choice of the money being spent on hospitals, schools or new roads. They were completely unaware of the fact that the capital for the scheme is to come from the private
704
market. If we are to have a referendum on the subject, the public should be aware of the argument and know the facts which, at the moment, I am afraid they do not.
People object because they feel that the public inquiry system is the only way in which to deal with the many concerns and reservations which have been expressed. I am delighted that my right hon. Friend the Secretary of State has had the courage not to have a public inquiry. I have for many years said that it takes an interminable time to take major decisions. For example, the A 1-M1 link has rolled on for 12 years, and we are still awaiting the inspector's report. I believe that major projects should he settled by decisions of the House, questions of side roads and perhaps compulsory purchase being left to public inquiry. I believe that in that respect the Government are absolutely right.
The third group consists of those who object to the scheme put forward. When the Select Committee examined the four proposals, to my mind there was really only one solution. If one accepted that the decision had to be taken in January 1986, all the other proposals had serious defects: environmental and technical in the case of Eurobridge and Euro Route and many questions about the viability of the Channel expressway.
In the case of the two bridges, the enormous cost was not the least of the problems. In Committee I asked Sir Nigel Broackes whether he agreed that the English Channel was one of the most expensive pieces of water to cross. He agreed. I asked him if he agreed that if EuroRoute were built, it would remain one of the most expensive pieces of water to cross. He said that he thought so. Therefore, I believe that if the Government or the House had put forward a scheme which would be so expensive that no consideration was given to the travelling public, it would have been a major mistake.
In relation to the Channel expressway, I give full marks to the public relations campaign behind that proposal because it became a serious runner. However, when one investigated it, one came across many serious questions which had not been answered. For example, there is nowhere in the world where anybody has driven for 32 miles in a tunnel. The question of cost was vital. As the White Paper points out, two tunnels of over 11 metres were to be bored which would somehow be cheaper to bore than the 7 metre tunnels of the Channel Tunnel Group. There are too many unanswered questions on the Channel expressway.
The Government have come to the right and wise decision. Therefore, they deserve support in the Lobby tonight.
8.22 pm
Mr. Alfred Morris: En recognition of the many others with strong claims to speak in the debate, from both sides of the House, my intervention will be studiedly brief. As a Member of Parliament for the north-west of England, I want to underline the importance of that part of the amendment which refers to the serious employment implications of the Government's proposals for communities outside the south-east. The word "damaging" is well chosen.
The Government's keenness to forge a fixed link with France contrasts sharply with their seeming unconcern about the deep and dangerous divide which now separates

705
the north from the south in this country. In linking Britain to another country, they appear content to countenance even graver divisions in Britain itself.
In the debate about Stansted I put it to the House that Manchester international airport—together with other airports outside the south-east of England—had a much stronger claim than Stansted to the huge investment which the Government were contemplating there. The same argument applies in this debate. To commit billions of pounds to the south-east, already the wealthiest region, at a time when other regions are starved of investment and devasted by unemployment will deepen and still further embitter the divide between north and south. In trying to link Britain to France, the Government risk tearing north and south in this country even more grievously apart.
It will be argued that many new jobs will be created by the channel fixed link; but they will not be jobs for the north, where any increase will be small and short term. Most of the new jobs will go to the south-east, and northern France will unquestionably do much better out of the deal than northern Britain. There will be substantial new investment to improve still further the infrastructure of the south-east. It will be investment from British taxpayers as a whole, from the north-west as well as the south-east, and that excites not just disquiet but downright anger in the region I represent.
The same money cannot be spent twice and, if it is spent in the south-east, it will not be available to reduce unemployment and the deprivation it causes in the north. That is the essence of our case against these proposals. When the Minister replies, is he prepared to concede that the White Paper must, at the very least, lead to an urgent revision of the Government's regional policy to take account of the implications of its proposals on the regions outside the south-east?
In many parts of Manchester today unemployment is three times higher than the national average. We heard earlier in the debate about unemployment in Kent. In Manchester we now have localities, in what used to be the heart of industrial England, where male unemployment is over 60 per cent., and others, including parts of my constituency, where more than two thirds of the under-25s are out of work. Is it not there and elsewhere in the north that new investment should now most urgently be concentrated?
It is much to their honour that 30 Conservative Members from the south-east have said publicly that new investment should now be directed outside their region. Ministers were also told by many of their party's leading young activists, in their conference at Blackpool yesterday, that the Government's critics on the north-south divide are not confined to the Labour party.
Opposition to the White Paper is utterly all-party in the north of England. There is strong insistence that the north's claims to more investment must now be the priority of priorities and, as the Minister must know, all comparative statistics justify that insistence.
There has been totally inadequate consultation about these proposals. Even the North of England Regional Consortium of local authorities has yet to meet a Minister to discuss its views. Many other important interests have been brushed aside in the Government's haste to do the wrong thing.
706
I reject the White Paper and hope to be joined in the Lobby by right hon. and hon. Members from both sides of the House in opposing its proposals. It would be the merest hypocrisy to go on complaining about the north-south divide tomorrow if we approve these proposals tonight. Action to repair and renew the links between north and south in this country must surely be a much more urgent priority than linking south-east England to northern France.
8.28 pm
Mr. Mark Wolfson: I welcome the White Paper because I believe that the proposals outlined and the particular choice made by the Government for the fixed link are practical, technically sound and financially viable. The right hon. Member for Lewisham, Deptford (Mr. Silkin) suggested that the first sentence of paragraph 2 where the Government set out their policy
"to increase consumer choice and promote efficiency"
meant absolutely nothing. He will not be surprised to hear that I cannot agree with him on that. However, on another matter, I was pleased to hear him—he was wearing his naval reserve tie, the ensign that I am always pleased to see—air his concern about the problems and the future of Britain's merchant fleet. On that issue, I join him.
I believe that the scheme gives the best chance for the ferries to survive, while, at the same time, it introduces the powerful stimulus of competition into what has, until now, been one of the most expensive sea crossings in the world. My right hon. and learned Friend the Member for Dover (Mr. Rees) has said that more detail is needed on how that competition will be maintained in future, but tonight the Secretary of State spelt out the fact that already we have seen a drop in ferry tariffs as a result of the decision to build a fixed link. The speed of decision was welcome. It is noticeable that that rapid programme was also acceptable to the French. I do not believe that Britain can, year after year, and decade after decade, take the length of time that we have to decide major projects through the system of public inquiry. That puts us way behind the rest of Europe on this issue.
The project is historic. It is obviously vast and also exciting. It is one for which the Government should take credit and in which this country, ultimately, will be able to take pride. It is also, a measure of increased confidence in Britain and in what Britain can achieve that four competing schemes were researched, put together as a package, and submitted.
I should like to deal with three aspects arising from the fixed link decision—the development of the railway, the development of the road network, and the effects on the environment. Many hon. Members have already spoken about the railway. I agree that not for 100 years has such an opportunity for the development of freight and passenger services been opened up to our rail system. I congratulate my right hon. Friend the Secretary of State on the support that his negotiations with the French have already given British Rail, the most important being an equal partnership for the development of the through trains from London to Paris and from London to Brussels, and for the building of the locomotives and rolling stock. It is crucial to obtain the best opportunities for British industry, particularly in the midlands and the north, which many hon. Members have mentioned, particularly Opposition Members.

707
I also welcome my right hon. Friend's commitment to an extension of British Rail's external financing limit to take full account of the opportunity that the Channel fixed link offers British Rail and the demand that it puts upon it. I can assure my right hon. Friend that I, for one, will be coming back on that issue in future because the fact is that, for many years, the French have given a higher priority to public investment in the railways that we have in Britain. In this new situation, we must rethink that issue.
Mr. Rowe: Does my hon. Friend agree, coming from a not dissimilar constituency, that one would have greater confidence in British Rail's capacity to take advantage of this undoubted good opportunity if it had shown itself to be more capable of cutting fares to compete with other forms of transport?
Mr. Wolfson: I accept my hon. Friend's point, that British Rail will have to ensure that its fares are competitive so that it can continue to compete. However, I shall not be diverted from my point, which is this. Down the years, the French Government have been readier to subsidise their rail network in terms of capital investment in it and running costs than we have been in this country. It is important, in achieving a balance between sensible support for British Rail and unnecessary pump priming, that British Rail is not limited in the opportunity that it is given to build a competitive system with the French railways in the wake of the Channel fixed link. Let me give two examples—the success of the grande vitesse trains in France and the new improved commuter routes round Paris, which put British Rail to shame, particularly the commuter routes.
Mr. Peter Snape: Does the hon. Gentleman accept that the investment being made in the SNCF in Paris puts successive British Governments, particularly this one, to shame anyway?
Mr. Wolfson: I do not agree with the hon. Gentleman on that. I am merely making the point that, in the new situation, British Rail's external financing limit needs to be extended, which my right hon. Friend the Secretary of State says he will do.
It is essential that customs and immigration procedures are done on train if the new through trains are to operate effectively, particularly from Scotland and the north of England. I appreciate that that will require a fundamental change in outlook from our officials in both those services, but I argue that that is exactly what the Channel fixed link is all about—just such a change in outlook by the nation as a whole. Of course, safeguards against smuggling, disease and illegal immigration must be built into altered systems, but it is simply not on to make no fundamental change to our control system in the face of the dramatic change in travel convenience that through rail offers. Today, many hon. Members have spoken out about the advantages that the fixed link offers, with the growth of rail traffic, to passengers and freight. Decanting passengers for a customs check on long-distance trains through Britain will be a major disincentive to train travel and will have to be changed.
Before leaving the subject of the railways, I should like to comment on the effect that the fixed link through trains might have on existing commuter services, particularly through my constituency of Sevenoaks. I welcome an
708
assurance that I have already had from British Rail, that it is well aware of the importance of maintaining a proper balance between maximising the opportunity for international business and achieving a proper service for captive commuters, for which, as it is well aware, it receives a subsidy from the taxpayer. I welcome its commitment to consultation with local people as the situation develops.
I should like to make particular reference to the M25 and the Dartford tunnel. It is essential that the third bore of the Dartford tunnel is built as rapidly as possible. We have a private enterprise solution to that. It is essential to move with great rapidity to get that work done. The traffic forecasts by the Department of Transport have consistently been grossly underestimated. I heard my right hon. Friend the Secretary of State struggling manfully the other day on the radio when dealing with the problems that already exist in the south-west section of the M25. He made the point, reasonably and honestly enough, that decisions on the size of that motorway were made 12 or 15 years ago. Now that he is in the decision-making seat, will he ensure that he gets it right on the Dartford tunnel, and does so quickly?
I shall confine my remarks on the environment to the concerns of my constituents. Other hon. Members will speak and have spoken powerfully for theirs. The consultative process in Kent must be genuine. I welcome the commitments given on that matter and we shall hold my right hon. Friends on the Front Bench to them. My first concern is the danger of urban sprawl eating into the green belt, especially in terms of warehousing development. The second is the increased pressure for major housing developments in west Kent and elsewhere. The third is the insidious squeeze to enlarge towns and villages on an ad hoc basis.
I know that my right hon. Friend the Minister believes that that development can be left to local authorities at district and county level: if they want development, they can allow it, but if they do not, they should not allow it. However, it is not good enough to leave it there, because the appeal procedure, the position taken by inspectors on those appeals in their advice to the Secretary of State and his decision bring us up against central Government policy.
I believe that an overall strategy is essential. Parts of the Opposition amendment on that issue have considerable relevance and that is something to which we should pay attention.
8.40 pm
Mr. Bruce Millan: I spoke during the debate on 9 December and I do not intend to repeat the points that I made then. However, I made it clear that I was completely opposed to a Channel fixed link for reasons very much on the lines explained by my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris).
Since our earlier debate, the choice has been made. For those of us who opposed the Channel fixed link the Government's choice is the least damaging from almost every point of view, including the regional view. Obviously, regional considerations are what I have in mind.
One must acknowledge that the scheme presents British Rail with some opportunities, but there is precious little sign of spreading those opportunities over the whole of the United Kingdom or that the Government will make the

709
necessary finance available, if the White Paper is any guide. In several respects, I consider the opportinities to be marginal for the railways.
It is the least damaging choice from the regional point of view, but it is the least popular among those in favour of the fixed link who have been considering a drive-through facility. That has not been chosen, and any prospect of it has been put into the dim and distant future.
In terms of pricing, everyone has said that it is important, for several reasons, including consumer choice and defence and strategic reasons, that the ferries should not be completely destroyed when the Channel tunnel goes ahead. Obviously, it is impossible to guarantee that position unless a view is taken on pricing. Paragraph 4 of the White Paper states:
"the promoter would enjoy full commercial freedom to determine his commercial policy including the setting of tariffs for users of the link"—
that sounds absolute, but it is qualified,
"subject to domestic and Community competition law, which contain essential safeguards against anti-competitive behaviour including abuse of a dominant market position."
What does that mean? We have had no explanation from the Minister. It is gobbledegook. I defy anyone to explain rationally or sensibly what it means. There has been much talk of predatory pricing, but who are the predators and who are the prey? No one has explained that to us. According to paragraph 21 CTG-FM
"envisage that their tariffs will be around 10 per cent. less, in real terms, than today's level of ferry fares."
That is the basis on which it is going ahead, yet the Minister told us this evening that the existing ferry operators are already proposing to reduce fares by 30 percent. in real terms. Who are the predators? From where does the anti-competitive behaviour that is mentioned in paragraph 4 come? What is the dominant market position? Will it belong to the ferry operators or to the tunnel operator?
It is nonsense to believe that it will be possible, except in the most fortuitious circumstances, to allow ordinary competitive forces to operate pricing across the Channel. If the Government are serious about maintaining ferry services, there must be price regulation in some form.
We have not heard from the Minister any sensible explanation of the White Paper, which in other respects is a completely inadequate document.
We have heard the argument about jobs during the construction of the tunnel. With unemployment in Britain at the present time, no one should disparage additional employment in any part of the country. However, the claims made were entirely exaggerated. The original summary of the project put forward by the CTG stated that
"Total employment created during construction will exceed 40,000 in the two countries."
That suggests that 40,000 people from the two countries would be employed on the tunnel, but from the White Paper we get a different interpretation of what 40,000 means. It turns out to be 40,000 man years spread over six years in the United Kingdom. That is an entirely different proposition from 40,000 people being employed. The distribution of the jobs involved realises our worst fears, especially in Scotland and the North.
We are told that almost half the United Kingdom jobs will be in Kent, which is not one of the most
710
underdeveloped areas in the country. There will be good opportunities in the east and west Midlands. We are lamely told at the end of paragraph 39 that
"there are firms in Scotland and the North-East able to supply construction materials."
All sorts of extravagant claims were made in the early stages that the jobs would go to the north of England and to Scotland. That is absurd and many of us made that point in the debate on 9 December. The Government's White Paper has confirmed it.
It has been said that work will go to British Rail workshops. Some of us are seeing the Minister of State, Department of Transport tomorrow about the obliteration of the British Rail workshop at Springburn. There are no opportunities for additional work there. If the Minister tells us tomorrow that, in view of the White Paper, Springburn will be kept going at a sensible level, I shall be delighted, but I do not believe that we will receive that answer.
The short-term aspect of jobs during the construction period is important, but the longer-term aspect worries the regions. The long-term advantage will go to the south-east of England. Paragraph 41 explains the difficulties about the reduction in employment on the ferry services on the assumption that the ferry services survive, but we are not allowed to know the basis of that assumption. The Government say that they will not publish their economic assessment, but on the basis of the Government's assumptions there will be a loss of employment on the ferry services but they hope that that will be made up as the years go by. They also mention generating new jobs in ancillary industry, again in the south-east.
The regional considerations are not dealt with, despite the fact that they were a major element in the debate on 9 December. The Government have no regional policy and there is no indication in the White Paper of what effect the fixed link will have on the regions of the United Kingdom.
In the long term, the economic development, the jobs and so on will come to the south-east. It would be impossible to prevent that from happening, even if we had a Government who were determined to try. It is futile to argue that jobs will be evenly spread throughout the United Kingdom.
Even if we were providing additional road and rail links—and the White Paper sets out only developments connected directly with the south-east—the main advantage would still come to the south-east. The argument that the advantages will be spread throughout the United Kingdom recalls the view of those who said that, if there were good links between Aberdeen and the rest of the United Kingdom, North sea oil jobs would be spread throughout the country. Of course, it did not happen like that. I am glad that, for good geographical and physical reasons, the Aberdeen area had the main benefit from North sea oil development. No Government could have prevented that from happening, even if they had wished to do so.
The argument that if a proper road network were developed between Aberdeen and Devon and Cornwall there would be as many jobs going to the west country as there would be in Aberdeen was a manifest absurdity, as is the claim that the Channel tunnel development will result in job opportunities being spread throughout the United Kingdom. Those opportunities will arise in the most overcrowded area—
Dr. John Marek: Will my right hon. Friend give way?
Mr. Millan: I hope that my hon. Friend will not mind if I do not give way; I promised to speak briefly.
The economic advantages of the project will come overwhelmingly to the south-east of England, which is precisely the part of the country where we should not be spending money to provide such opportunities when there is devastating unemployment in Scotland. [HON. MEMBERS: "What money?"] Any sort of money, whether private or public.
Mr. Stuart Holland: Is my right hon. Friend aware that British Rail is to build or make extensions to six platforms at Waterloo station and to viaducts and other systems? That is happening at just one station. Will not that be paid for with public money?
Mr. Millan: Of course it will be public money. I dealt in my speech on 9 December with the whole question of public and private money and I have no intention of going over that argument.
The concentration of expenditure, whether of public or private money, and the ultimate concentration of activity will be in the south-east of England. That is incontrovertible and it will be against the interests of the rest of the United Kingdom. As my right hon. Friend the Member for Wythenshawe said, that will emphasise the north-south divide.
Stories have appeared in the Scottish newspapers over the past few days—I presume that they are valid—that the Secretary of State for Scotland is engaged in a tremendous battle to prevent the Treasury from clawing back £6 million from the Scottish Development Agency. A great political battle is going on within the Government about a comparative trivial sum for development in Scotland, yet we are being asked to approve a White Paper which sets out the expenditure of billions of pounds of public and private money for the benefit of one of the richest areas in the United Kingdom. Those of us who represent Scotland are absolutely against the project, and we shall carry our opposition to the limit.
8.54 pm
Mr. David Couch: As befits a former Secretary of State for Scotland, the right hon. Member for Glasgow, Govan (Mr. Millan) made a Scottish speech and argued strongly, as he is entitled to do, for more industry and activity in Scotland.
I do not blame the right hon. Gentleman for adopting that approach. He said the same things on 9 December, and I followed him on that occasion, too. I was somewhat parochial then, and I shall be somewhat parochial today, because I wish to speak about the problems of what the right hon. Gentleman called the rich area of the south-east of England.
We in Kent are relatively rich and we have a lower rate of unemployment than the national average, but I remind the House that we are debating a White Paper which is in two parts. We are asked to approve the Government's choice from the four options, and we have to consider the consequences of approving a fixed link. The consequences that worry me most are the environmental consequences in Kent.
Paragraph 28 of annex B to the White Paper says:
"Local opinion in Kent generally has been against a link."
712
I would describe opinion in east Kent in rather stronger terms. I believe in the link and have said so in the House and on many occasions over many years. I am not popular in my constituency for having taken the national view.
Many of my constituents believe that I have let them down by taking a national, not a parochial, view. Those of us who support the link may be wrong, but I believe that we are right. However, I wish to outline the view of local people who will be directly affected by this major engineering event.
I have received many letters against the project and quite a few in favour of it. A distinguished engineer, who is a member of the Royal Society and was a promoter of the Channel bridge, suggested that the best solution for me would have been a bridge across the Channel and a tunnel under Kent. Perhaps that would have made life easier for me, but it is too late to ask for that now.
On Wednesday I shall be welcoming the Prime Minister and the President of France when they come to my constituency to sign the treaty. Every Prime Minister whom I have served under has been to my constituency—and even the Pope has been there. I think that it is appropriate that the treaty should be signed in a part of the county where there is grave anxiety about the project and dissension about whether the link should be provided. The Prime Minister was brave to choose to sign the treaty in the county where there are many critics.
Many people are against the link, for many reasons. The right hon. Member for Lewisham, Deptford (Mr. Silkin) said that many people are against the link for its own sake: we should have no link with the continent; let us keep Britain an island with a 22-mile moat between us and our enemies. That is what our people have been taught in school for the past 200 to 300 years—and in three wars during the past 200 years, they have been proved right.
I have tried to tell people that today the nations of Europe are not our enemies, but our allies and partners. Perhaps those thoughts of Russians with snow on their boots—memories of the first world war—are still in people's minds. I simply remind them that military historians often say that we must not try to fight the next war on the lessons of the past, but rather to think ahead.
Tonight I wish to speak only about the environmental consequences for Kent. The tunnel will be a magnet for traffic, and many people say that Kent already has too much traffic. The price that Kent will pay will be very high. I agree with those who fear the effect on the environment. There is a real danger that damage will be done to a beautiful part of England. Indeed, the While Paper states that many times, as does the environmental appraisal by the land use consultants.
The challenge to the Government and the Channel Tunnel Group is that they must limit damage to the environment. I remind the Government that we are debating not only the choice of link, but their response to the challenge to safeguard the environment in Kent. Paragraph 15 of the White Paper refers to the choice that
"has an environmental impact that can be contained and limited."
In paragraph 32, it states that
"the environmental damage will be kept to a minimum."
Therefore, the White Paper acknowledges in those and many other paragraphs that there will be environmental damage.
My right hon. Friend the Secretary of State said that the Government recognised that there would be problems in

713
Kent, and that they were concerned about that. Paragraph 45 of the White Paper states that the Government would now be
"concentrating upon making the chosen scheme as acceptable as possible.".
From now on, there must be good public relations where there has been none before. Indeed, there must be much more than good public relations—there must be consultation. I am glad that we have been promised a consultation committee.
The project will need explanation because there has been little to date. It will also need participation. The Government should not be afraid of that. Let them not only listen to the people of Kent, but invite them to have a say in the final decisions about the environment. The Government must clearly explain the meaning of a hybrid Bill and how it works. Such a Bill must be sold to the public.
There is an understandable clamour for a public inquiry. Without one, people will want to know the meaning of the hybrid Bill. It may be that they will have a better hearing with a hybrid Bill. The Government must explain what such a Bill does and how it works.
The Government must take positive steps to safeguard the environment. I do not simply mean engineering, building, road works and rail investment. Let us hear about limiting the intrusion of those developments into the environment. Let us hear about landscaping—artificial hills that can screen unsightly engineering and industrial developments. That has already happened in other parts of the country. For example, at Torness in Scotland an artificial hill now screens a nuclear power station. The sight of a nuclear power station on the way to Edinburgh is hardly attractive. The Government should tell the public how they intend to reduce the adverse effects of this great tunnel development.
I counsel not only the Government, but the Channel Tunnel Group, because in this private sector activity that group has a great responsibility to show that it is concerned about protecting the environment. It should strive for a new image—not only as an engineering company, but, in this modern age, as a company concerned about the public and about the impact on the environment.
I reiterate what my hon. Friend the Member for Sevenoaks (Mr. Wolfson) said about roads. The M20 is to be a three-lane dual carriage motorway connecting with the M25. We daily read about the crowded three lanes of the M25. Would it not be better to build the route to Europe as a four-lane motorway so that we will not have to install the fourth lane in 10 years?
As mentioned in the environmental appraisal, there has to be traffic direction. It will be better to funnel the traffic to the Channel tunnel on the M20, when it is properly built, than for people to seek the best way they can to avoid the crowded M20, as I think it will become, and to use what the environmental appraisal describes as the "rat runs" of minor roads. That would create danger and havoc across Kent.
I am making a Kentish parochial speech. The people of Kent are lucky to live in one of the most beautiful corners of England. Dover and Kent have always been the gateway to the continent. We should not blame the people of Kent for standing up and trying to preserve their heritage. The Government must remember that, because it is important.
9.5 pm
Mr. Stuart Holland: I certainly hope that when the hon. Member for Canterbury (Mr. Crouch) meets the President of France in a few days time he will be more diplomatic about the nature of Socialism than the Secretary of State for Transport in his concluding remarks.
The right hon. Gentleman tried to downgrade the policies of the Left in relation to the public sector, but it is interesting to consider what we have learned tonight from the debate. The French Socialist Government and their publicly owned railway system was the first to offer lower fares and put a specific mark on how much lower they would be. French trains on the link will travel faster than ours—160 miles per hour rather than 100 miles per hour—which is of significance in the length of time for crossing the Channel. There is freer information from the French Government.
The hon. Member for Thanet, North (Mr. Gale) told us that the French Socialist Government have published far more information on this issue and its direct and indirect effects than the British Government have. That was a point made by Conservative Members. The French Government's plans were prepared earlier and were more publicised than the Government's. The French Government have also offered something which is favoured by our Government, wider choice. There is a choice once one has crossed the Channel about where one can go. The striking thing about the French proposals is that one could take the train from Britain either to Paris or Brussels.
That is relevant in relation to the dispersal argument—the dispersal of the traffic after it has come through the chunnel. It is relevant to my constituents since the outlet terminus, the sole outlet terminus scheduled by the Government, for all the rail fixed link traffic is Waterloo. The dispersal argument is a very strong one. If we are to make effective use of this link we need to be able to bypass London, via Euston to the north-east, or via the new Snow hill tunnel when it is completed. For that traffic which has its destination in London there should have been serious consideration in the White Paper—there is no reference to the issue—of the night sleeper traffic going to White City or Olympia, for freight going to the docklands, and for passengers going to either Waterloo or Victoria. It will be possible to take a train for Paris or Brussels. Similarly it should be possible—I can see even now the indicator board flashing at the Gare du Nord—for one to learn that the next train will go either to Victoria or to Waterloo, or that it will go from Kings Cross through the new Snow hill tunnel to Birmingham, Durham and then Newcastle or from Kings Cross to Birmingham, Crewe and Glasgow.
If there is not this dispersal of traffic, and if the international rail traffic—as anticipated in a throwaway sentence in the White Paper—will outlet only at Waterloo, the commercial viability of the project, on which the Government pride themselves, will be profoundly qualified. The real advantage of rail over air is time and convenience. We all know from experience of the inconvenience of commuting to Paris or Brussels. We have to take a train, the tube or the car to Heathrow, where we have to wait before taking the aeroplane, and, on arrival, we have to take more transport to our final destination. A minimum of three legs is necessary in a journey from central London to central Paris.

715
We have heard much about rail versus sea, but if there is a real commercial advantage in rail versus air it will be as a result of being able to rest or work on a train without interruption, and to get off the train at the other end and leave the station immediately. But that is not what is proposed. What I have said about Waterloo are not local issues concerning the use of one station, but issues that concern the viability of the project.
What is the sense of taking three and a quarter hours on the train and then having to go through Customs as at an airport? That would profoundly undermine the attraction of the scheme. There are proposals, which I have here, for six new rail platforms and their extensions at Waterloo and for an entire new international terminal. It will be a double-decker arrangement over the concourse. However, it does not make sense. Its aesthetic attractiveness is one issue. but we must consider whether it will be any use to the millions of consumers, including those who go to the City via Waterloo, who use the station as a commuter station. They will find that part of the station is allocated exclusively to international trains—that part closest to the exit to Shell house, the City and the Bank link.
There will be congestion because passenger trains from Paris will arrive in the early morning and in the late evening. The Minister is indicating by facial expression—perhaps it is something else—that he is not sure. I am not sure of him because I have got no information on these matters from him, although I tabled a written parliamentary question. All of the signs are that the overnight sleeper link will arrive in the morning, and thus increase congestion. Congestion is of some relevance to the House. This is not an entirely facetious argument. Those who get on the train at Paris at the end of a normal working day will arrive in London at about 9.30 pm. Perhaps by the time that passengers have got out of the station and into other traffic, assuming that they do not have to go through Customs, as Customs formalities could be completed on the train, it will be 9.50 pm. Perhaps the Minister will assure us that the times will be different. Nevertheless, if the project is a success and there are many trains arriving in London in the late evening, there will be a problem.
Many hon. Members enjoy telling me that they are my constituents, and that they live in the Division Bell area. If the trains arrive at about 9.45 pm. the Division Bell area and property values in it might shrink. There are only two bridges for road traffic from Waterloo. Anybody who has gone across Waterloo bridge from Waterloo station knows that there is one underpass going north, but that to go to the west end down the Strand is a positive nightmare.
In practice, traffic leaving Waterloo turns left, goes around the traffic island next to County hall and comes over Westminster bridge. That is not an insignificant factor if we are to have road traffic links and bus services. The Minister has said nothing about buses. Will private contractors be able to pick up traffic at Waterloo? Such considerations must be examined.
Many of my constituents and I believe that those matters should be considered by a tried and tested means—a public inquiry. I have great sympathy for hon. Members with constituency interests, such as the hon. Member for Thanet, North and the hon. Member for Mid-Kent (Mr. Rowe), who have been steamrolled by the Government to agree the decision in principle.
Mr. Ridley: Is the hon. Gentleman aware that Waterloo station was built through the private hybrid Bill procedure?
Mr. Holland: The Secretary of State must do better than that. Is he aware that at: the great event to take place in four days' time the President of France and the Prime Minister of the United Kingdom will sign an agreement for traffic and French tourists to outlet exclusively at a station in London called Waterloo? What a victory for the entente cordiale. For the sake of common sense, give them the choice of going either to Victoria or Waterloo. But there are more important points to be made than on hybrid Bills.
The Government have not undertaken to set up a public inquiry. Although hon. Members who represent Kent have been steamrolled to get the principle of a Channel link passed so that construction work can start, there is plenty of time for proper public inquiry procedures to be undertaken into where traffic should outlet in London and elsewhere.
Environmental factors should also be considered. I have received extensive submissions from constituents that the local area could not sustain the traffic or take the strain. I hope to speak on Second Reading to take those points further.
9.16 pm
Sir John Osborn: New capital projects, including the Channel tunnel, are surely what the construction and engineering industries, the north, and the Confederation of British Industry have been asking for to provide employment. Listening to the debate, it is clear that there is some truth in the observation that whenever a Government make a decision, the British people are good at providing every reason why its implementation is, at best, difficult, and, at worst, impossible. I have even received a letter from Sealink stressing the opinion poll view that once the road link had been abandoned, the public turned against the concept of a Channel tunnel at all.
I welcome the White Paper, and particularly the Government's choice. As joint chairman of the all-party Channel tunnel group, certainly at the December exhibition and conference at Lille, I have supported the fixed link, or ligne fixe. Despite the speeches of the right hon. Members for Glasgow, Govan (Mr. Millan) and for Manchester, Wythenshawe (Mr. Morris), I am convinced that the decision is good for Britain as a whole. It is, or could be, good for our industry, the midlands and the north. It is a challenge and an opportunity that I hope the country will grasp.
My hon. Friends who represent constituencies in Kent, including my hon. Friend the Member for Canterbury (Mr. Couch), have given contradictory views about whether the link will take jobs from the area, especially from Dover and Folkestone, or bring new industries to its rural areas, ruining the environment and despoiling the countryside which, as a northerner, I have come to know and appreciate. From what my right hon. Friend the Secretary of State said, I am convinced that the decision need not despoil Kent, or bring unwanted industries into the towns, alongside the main roads, the railway lines and motorways between the centre of Britain and the coast of Kent. As a northerner, I see no reason why Kent need have any more new industries than it wants. I want to see those industries come to the midlands and the north, and I want political

717
and industrial leaders to take this opportunity to make sure that that happens. After all, there will be new industries stemming from creation of the tunnel, but already it is a fact that 60 per cent. of our exports go to the Community anyhow.
The British Rail-SNCF link could provide the opportunity for long-distance freight—I admit that that may be container traffic—to travel from Manchester to Milan on a regular basis. The EEC freight network—which is somewhat larger than ours because of the longer distances involved—could undoubtedly bring the midlands and northern industries nearer to their customers and markets. That will be a vital step forward, and it is an opportunity which must be welcomed and grasped.
During the debate in December 1985 the Euroroute and expressway were considered to have advantages. In reply to the hon. Member for Carlisle (Mr. Lewis), I said that I supported the solution put forward by the Channel Tunnel Group because that would do least harm to the Channel ports and I hoped that 50 per cent. of cross-Channel traffic would still be carried by sea. It would be least costly, take a lower volume of traffic to provide a return and give a faster passage.
In the debate inspired by the hon. Member for Linlithgow (Mr. Dalyell) on the dangers of the expressway drive-through, I supported the concept of drive-through but was alarmed about safety, ventilation and the technology to achieve that. On the other hand, if the expressway could modify its original proposal from two to four tunnels, it occurred to me that there was no reason why the CTG should not start with rail and, if traffic demand increased to justify it, supplement the original two rail tunnels with an additional road tunnel. I believe it is better to start with known technology and to "walk before you run". A drive-through could be provided later.
Subsequently I was in favour of the drive-through being limited to cars, not heavy road vehicles. A 50-kilometre stretch of road does not strike me as being a good place for a mixture of heavy road vehicles and cars. The larger tunnel, having three lanes and perhaps a reserve or certainly laybys for heavy vehicles as well as cars, could be too wide for the narrow width of chalk for the tunnelling operation. Paragraph 16 of the White Paper deals with that. In the long term, I favour a drive-through for cars only. I hope that heavy vehicles will continue to use the shuttle or the ferries. That decision can be made when the first step has been taken.
As other hon. Members wish to speak, I shall withdraw my other comments, except to stress one final point. The Sheffield chamber of commerce has asked me to explain what orders are likely to come to the north of England over the next few years. The engineering requirements amount to £700 million. The need for pre-cast linings means that £130 million will go to the midlands and north of England. Cast-iron tunnel equipment will mean £30 million to the midlands and north-east England. Rolling stock would bring £120 million to the midlands and the north-west and electric locomotives would bring another £40 million. There are orders for the north in the short term, and the north and midlands could be brought nearer to their customers by a railway network which is proving itself elsewhere in Europe. I therefore welcome the decision taken by my right hon. Friend.
9.24 pm
Dr. John Marek: I also welcome the Government's decision and regard the Channel tunnel as potentially the biggest boost for railways in Britain this century, following decades of neglect.
British Rail predicts that cross-Channel passenger traffic will jump from the present figure of 3 million a year to 9 million in the first year of the tunnel's operation as a result of self-generated traffic and as the reliability and price competitiveness of rail services divert passengers from air travel. These figures are based on conventional train speeds. By the year 2003, when new high-speed rail services will be open to Brussels and Paris, passenger traffic is expected to rise to an annual total of 11 million.
The Channel tunnel also gives British Rail enormous new potential in the international freight market. At present, international freight traffic represents only 2 per cent. of British Rail's freight business by comparison with 22 per cent. on German railways and 21 per cent. on French railways. Present cross-Channel carryings of freight are only about 2 million tonnes. British Rail estimates that 6 million tonnes of cross-Channel freight will be rail-borne at the end of the first year of operation at the end of 1993, rising to 7 million tonnes by the year 2003.
There is no doubt about these projected increases in rail passenger and freight carryings. The result will be faster and more frequent services to European destinations and this will appeal to the travelling public and British industry alike. The business man in Manchester will be able to load his freight on to wagons in Manchester and they can be offloaded at Duisberg, for example, without any difficulties stemming from crossing the Channel.
More services, the new build for freight and passenger trains, new terminals and additional maintenance requirements will mean more jobs in the railway industry. The Government must do two things to enable British Rail to seize this opportunity. First, they must ensure that the appropriate levels of capital investment are available to British Rail to carry out the necessary new build of rolling stock and infrastructure development. At the very least, there must be no constraints on British Rail's external financing limits for this work. The capital investment must be made in the United Kingdom.
Secondly, the Government must ensure that agreements are reached as speedily as possible with the Home Office and Her Majesty's Customs and Excise to permit on train Customs and immigration facilities. I hope that when my hon. Friend the Member for West Bromwich, East (Mr. Snape) replies he will assure us that he will do his best to ensure that those who are shadow Home Office Ministers will make certain that this is done if the Government cannot give us an assurance tonight.
What will the benefits be for employment? Combined British Rail and Channel Tunnel Group expenditure in the United Kingdom on equipment, materials and labour in the construction phase of the tunnel will be over £1 billion. This is an enormous opportunity for British industry. As the expenditure will be primarily on engineering and construction works, the traditional industrial regions can benefit the most. There is no reason to believe that the orders will be placed to any large extent outside the United Kingdom. In practice, British Rail will buy British, unless tenders are improbably low from abroad. The Government

719
must help British industry, and an assurance from the Minister of State on this score when he replies would be extremely welcome.
We want none of the dumping which has so often led British manufacturers to lose out on rail export contracts. For the CTG contracts, EEC competitive tendering rules will apply. Again, there is no reason to believe that British industry will be unable to compete effectively.
The CTG has maintained consistently that its expenditure in the construction phase will generate about 40,000 man years of direct employment in the United Kingdom. If we add to that figure the indirect employment that will be generated, there will perhaps be about 70,000 man years of employment. In addition, we shall have British Rail investment, which will provide many jobs and opportunities, mainly outside the south-east. It is clear that in the construction phase there are enormous benefits available to the north of England, Scotland and Wales, with Government help and if the Government wish.
I must disagree with the remarks of my right hon. Friend the Member for Glasgow, Govan (Mr. Millan) about a parallel with Aberdeen and the oil industry. Aberdeen benefited from the oil industry, but so did the rest of the country when the oil came aboard. Unfortunately. the Governments economic mismanagement meant that all the oil revenue was spent on paying unemployment benefit, but that is another matter. If we have a Channel tunnel, it will benefit the south-east and the rest of the country.
If the economy were buoyant, we would not be talking in these terms. Unfortunately, the economy is not buoyant and we have problems and apprehensions about jobs. If the Government will it, we can benefit as a united country from the Channel tunnel project. I hope that it goes ahead without any impediment.
9.28 pm
Mr. James Couchman: I am delighted to have the opportunity briefly to express my welcome for the scheme for the Channel tunnel. I am disappointed that the rail-only option has been taken, especially in view of the excitement and attractions of the Channel expressway, which was very much a latecomer to the scheme as a whole. If the lead time between the tender date and the date for a decision was too short to enable the Channel expressway to be assessed properly, the date for decision should have been extended. We may have been forced into this historic decision in something of a hurry to satisfy the electoral needs of the French Government.
There is no incentive for CTG ever to build the road link, and if every possible contender finds it difficult, because it has to wait to the year 2020, to put in the road scheme, that will not happen within the foreseeable future. It will be a bonus to Kent, and my constituency in the Medway towns, which has an unemployment rate of 17 per cent. I have sympathy for those hon. Members from the north and from Scotland who say that the scheme will siphon the employment from elsewhere down into Kent, but the Medway towns and other industrial parts of Kent are prepared and able to exploit this potential, which will be of advantage.
The M2 will be equally as important as the M20 as a route to the tunnel. The M2 will become so busy that it will cease to be the local bypass for the Medway towns and, as my hon. Friend the Member for Mid-Kent (Mr. Rowe)
720
suggested, will make it imperative that a northern relief road for the Medway towns and a third crossing over the Medway be built soon.
9.30 pm
Mr. Peter Snape: Although this has been a truncated debate, it has illustrated not only the depth of the cross-party support for the scheme but the depth of the cross-party opposition to it. I shall have some difficulty in reconciling all the views that have been expressed in the debate, but I think that I can take a majority of the House with me fairly early on when I refer to the contribution of the Secretary of State. If anybody was careful not to say anything about the consequences of the Channel link, it was the Secretary of State. He had his usual go at the Labour party and used the example of myself and my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), who is sponsored by the National Union of Seamen. We have never made any secret about the fact that we have disagreed over the desirability of such a link.
The Secretary of State had a go at the Liberal party arid saw contradictions there. I cannot answer for it, and none of its members is present. I thought that the hon. Member for Isle of Wight (Mr. Ross) set out as honestly as he could what he felt, but who knows about the rest of the Liberal party—then again, who cares?
When the Secretary of State makes such attacks, he overlooks a major point about which we had to tick him off at Question Time only last week. We all know, because he has said so on several occasions, that the right hon. Gentleman opposes all schemes for a Channel tunnel link. He shakes his head, but for years he has opposed all such links. The Prime Minister took him to Lille the other week:, and then sent him home like the old-fashioned post office telegram boy to tell the House of Commons what she had decided. The right hon. Gentleman had to do his duty. He arrived without having had his lunch and delivered the, for him, unwelcome message that the Channel Tunnel Group scheme had been chosen and it was up to him, as the Secretary of State, to find enough excuses to justify the choice and the public resources to cater for the demand that such a choice would make on British Rail.
The Secretary of State had some sport—I make no complaint about that—with the Opposition's amendment. I concede that it is fairly detailed, but we feel, or at least those of us who have the slightest glimmer of hope on the Channel link feel, that the detailed nature of our amendment amply illustrates the fears expressed from both sides of the House about the likely economic consequences of a Channel tunnel link and its impact not only on the south-east but on all other regions.
I said earlier that it lies beyond my abilities as an orator., poor though they may be, to convince right hon. and hon. Members who are completely against the fixed link. My prospects of convincing my right hon. Friend the Member for Glasgow, Govan (Mr. Millan) are about equal to the prospects of Berwick Rangers winning the Scottish cup. He said that the scheme will have an impact upon the economic imbalance between the south-east of England and the rest of the United Kingdom, but acceptance of the Channel Tunnel Group scheme or any other scheme is irrelevant to the economic imbalance. Those who are opposed to the fixed link have an obligation to tell the House how the economic imbalance will be improved

721
without the scheme. I sympathise with and understand the view that a better use could be found for the £1 billion that is to be put into this scheme.
I served upon the Standing Committee that considered the last Channel tunnel Bill.
Mr. Boyes: That was in 1926.
Mr. Snape: No, it was not in 1926. My hon. Friend must get it right. It was in 1975.
The objection of many of my hon. Friends then was that better use could be made of public money than by spending it upon a Channel tunnel. I did not agree at that time with my hon. Friends and I do not agree with them now, but I understand their point of view. However, the House is aware that this fixed link will not involve public money. Therefore, my hon. Friends presumably wish the £1 billion of private sector capital to be spent in other directions. However, that choice is not open to us. We have no control over the expenditure of private sector capital. I fear that if it were not to be spent upon the fixed link, it would not be spent upon the deprived regions of the United Kingdom.
We have to decide, therefore, whether the scheme that has been chosen by the Prime Minister can remotely be defended. The Government have missed an opportunity. They should have set out the economic advantages of the scheme for the rest of the United Kingdom. The hon. Member for Thanet, North (Mr. Gale) let the cat out of the bag when he referred to the amount of information that is available to electors on the other side of the Channel. The French Government have set out in detail the impact of the scheme on the French economy, particularly upon that part of France which most closely abuts the entrance and the exit to the new Channel link. Why have our Government not done the same? This Government do not believe in the kind of planning that the French Government have long since embraced.
The Secretary of State had the cheek to tell us that this will be a wonderful, capitalist tunnel. It was a somewhat exotic phrase, even for him. Presumably the tunnel changes halfway under the Channel and becomes a wonderful Socialist tunnel, although I do not suppose the fact that President Mitterrand is a Socialist has ever entered his head.
The right hon. Gentleman referred earlier to what he called the inherent conservatism of the British people which he said was already being shown by the fact that they are writing letters objecting to the proposals. Again, he rather condemns himself from his own lips, because if there were a typical Conservative it would be the right hon. Gentleman. It is not his fault that he is the second son of Viscount Ridley and was educated at Eton and Balliol, but there are comparatively few Left-wing Socialists with such a background.
Mr. Ridley rose—
Mr. Snape: I have not finished yet. I am not in a position to know about the right hon. Gentleman's friends, but I have not met too many Left-wing Socialists who are so educated, so if ever there were a typical Conservative it is the right hon. Gentleman.
Mr. Ridley: I only want to remind the hon. Gentleman that the hon. Member for Linlithgow (Mr. Dalyell) was my fag at Eton.
Mr. Snape: All I can say is that it must have been that experience that drove my hon. Friend into the Campaign Group. I cannot think of a better reason.
The fact that our amendment is couched in the way that it is is also due to the fact that the Government have transparently failed to show how the so-called economic benefits can be fairly spread throughout the country. Indeed, according to the White Paper, there is no compulsion, there is not even an attempt at persuasion, to ensure that the large amount of capital expenditure to which the Channel Tunnel Group is committed will be spent within the United Kingdom. Yet a great deal of capital expenditure could, should and, one would hope, will be spent within the United Kingdom. I hope that when he replies the Minister will give us some definite assurances that that will happen. After all, the Channel Tunnel Group is talking about an expenditure of about £300 million on rolling stock.
My right hon. Friend the Member for Govan and others have talked about the plight of British Rail Engineering Limited and my right hon. Friend specifically referred to the future of Springburn. Nothing in the White Paper or the Government's proposals gives a shred of assurance for Springburn. They do nothing for the future of Swindon or Doncaster. The British Rail engineering workshops are being divided before privatisation and it is the Government's intention, with typical cynicism, to dispose of many employees of British Rail Engineering Limited before the orders for the work on this scheme are laid.
We are seeing the Government's usual cynicism. The redundancy payments for those who work in British Rail Engineering Limited will be picked up by the public sector. The taxpayer will be responsible for paying off skilled craftsmen throughout the country. Yet we know from the details that can be gleaned from the White Paper that the hundreds of millions of pounds worth of orders which will result from the Channel Tunnel Group scheme will go to a privatised British Rail Engineering Limited and those orders will benefit the private sector while the public sector will be left to pick up the bill. That is the reason for the cynicism that is being expressed by Labour Members. I hope that even at this late hour the Minister will say something about the future of those thousands of men and women within British Rail Engineering Limited who, regardless of the scheme, are facing redundancy.
The aspects on which the Government have failed to reassure any of us extend to substantial orders for BR. Where in the White Paper are there any details of the places from which rolling stock orders will emerge? There is talk about the Government's pricing policy and there are well-meaning hints about potential, but a Government who are prepared to tolerate the enormous decline in manufacturing industry that this Government have positively encouraged since 1979 are surely not to be trusted without specific details on BR's ordering policies.
Who is to build the 20 high-speed trains, the 400 freightliner wagons and the extra freight locomotives, wagons and coaches and who is to provide the electrics for the electrification schemes and the steel needed to meet the commitment for the large marshalling yard at Ashford? Who will construct—I refer to the contribution of my hon. Friend the Member for Vauxhall (Mr. Holland)—the new international terminal at Waterloo? What guarantee do we have that the scheme will benefit British railways and engineering nationwide? We seek reassurance.

723
Hon. Members on both sides of the House have referred to the benefits to British Rail freight that link will bring about. Will the Minister of State give assurances on the extension of section 8 grants?
The Minister of State, Transport (Mr. David Mitchell): Just give me the time.
Mr. Snape: The hon. Gentleman was the first to throw away the time available. He wants to say as little as possible. Whatever he says, it will probably be more than the Secretary of State, but I do not know whether he will say it as elegantly as his colleague. Is there to be an extension of section 8 grants to enable British Rail freight to take advantage of the long-haul and through freight trains that the CTG scheme should in all conscience bring?
In some ways, the debate has crossed party lines. One does not often hear encouragement such as we heard from the hon. Member for Sevenoaks (Mr. Wolfson) in demanding much greater investment in BR. We hope that he will join us in two weeks at Transport Question Time when he can put these matters to the Secretary of State. He can bring his colleague the hon. Member for Mid-Kent (Mr. Rowe), who spoke of the failure of BR management to reduce fares and therefore fill trains. It is difficult—I shall say this slowly because I can say it only once and I hope that the hon. Member for Mid-Kent will understand me—to reduce fares and fill trains when faced with a Government who have been anxious for years to reduce the amount of money available to BR, especially under a Secretary of State who took £200 million out of BR's investment base. I hope that Conservative Members will turn up a little more often at Transport Question Time to put these points fairly and squarely.
The Opposition have tabled their amendment because they want assurances. We need better assurances on the future of British manufacturing industry, especially from the Secretary of State. I am not knocking the Minister of State, but I know that, if the assurances are not written down on his papers, we shall not get them. If we do not get assurances, I urge my colleagues to go into the Lobby to support the Opposition's amendment.
9.48 pm
The Minister of State, Transport (Mr. David Mitchell): We have had a valuable debate in which hon. Members on both sides of the House have clearly expressed their views. A number of hon. Members, including my colleagues from south and east Kent, have expressed their anxieties and asked me questions. I shall seek to reply to those questions before turning to the negative and carping Opposition amendment which signally failed to rise to the occasion and in good measure contradicted what was said by the right hon. Member for Manchester, Gorton (Mr. Kaufman), who said that a Labour Government would continue this project.
The hon. Member for Aberdeen, North (Mr. Hughes) clearly misunderstood the purpose and method of operation of the consultative committee, which I shall chair, which will meet in Kent with local authorities and the Channel Tunnel Group. It is intended to seek ways to minimise the damage caused locally by the construction and to maximise the benefits by agreement between the promoters and the public authorities.
I can give the hon. Gentleman the assurance that he sought, that those who make representations to the
724
committee will not affect their ability to be petitioners against the Bill. The hon. Gentleman also asked about the resources available to British Rail. I assure him that we plan to give British Rail an EFL sufficient to cover its commercially viable investment, which is what is involved in this project.
Mr. Roger Moate (Faversham): On the subject of rail investments, will my hon. Friend say if and when British Rail will have the resources necessary to widen the loading gauge so that through container traffic from all parts of the United Kingdom will be able to use the tunnel? That is crucial to the rail freight argument.
Mr. Mitchell: I assure my hon. Friend that that is something which British Rail is planning.
My right hon. and learned Friend the Member for Dover (Mr. Rees) asked whether the committee would meet in Kent other than in Maidstone. I assure him that we intend to move around the county. He mentioned the problem of Shakespeare cliff. I can again assure him that that is a matter that we will consider carefully in committee and with the promoters. He also asked about jobs. I shall deal with that point separately.
My right hon. and learned Friend asked for three assurances. The first was about predatory pricing. The Monopolies and Mergers Commission can deal with that point under the Fair Trading Act 1973. He also asked how quickly the Office of Fair Trading would deal with a problem. It can react quickly and carry out an assessment of a problem if one arises.
The right hon. Member for Deptford, Lewisham (Mr. Silkin) asked about spoil dumping at sea and whether it would kill the spawning fish in the English Channel. That matter will be covered by the work of my consultation committee. In no circumstances would we allow the spawning grounds to be damaged.
My hon. Friend the Member for Thanet, North (Mr. Gale) asked about the trunking of Thanet Way. We are consulting Kent county council about that matter, and I shall see that the consultative committee covers that point. He mentioned, as did other hon. Members, a document produced by the French Government about their intended investment in the Pas de Calais. He asked whether we could have a similar document in the United Kingdom. We have that in the White Paper, the statements that have been made in the House, the questions that have been answered and the speeches that have been made in the debates. Drawing all those matters together in one document might be helpful to hon. Members. I will consider that point carefully.
The hon. Member for Vauxhall (Mr. Holland) asked about Customs, as did my hon. Friend the Member for Sevenoaks (Mr. Wolfson). I agree that it is desirable that Customs and Excise formalities should if possible be carried out on the trains. We are discussing with the Customs and Excise what is needed to satisfy its requirements.
The hon. Member for Vauxhall and other hon. Members asked about the hybrid Bill procedure. I shall not go over the arguments about that again. The House has already well debated them. However, I have today written to my hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), who has been in his place throughout the debate, and who is assiduous in representing his constituents' views. I have set out in full

725
the procedure which applies to a hybrid Bill and informed him of the opportunities for consultation and objection available to those of his constituents who wish to take advantage of them. I will place a copy of that letter in the Library. I intend, in addition, to produce a layman's guide in the form of a simple leaflet so that his constituents and others who are affected may be aware of what it involves
A civil engineering project of this size, as with any other major project, is bound to have an effect on the environment. There will be damaging local effects and wider national benefits. As the House is aware, I will chair in Kent a committee consisting of local authorities, the Department of the Environment and the promoters. We shall be looking at ways of carrying the project through with a minimum of practical damage to the environment. I recognise that that has particular and unique effects on Shepway and it is my intention to seek an invitation as soon as possible to meet the council to discuss the effects.
However, it is not only in Shepway that there will be environmental effects. For years, environmental groups have been pressing for more goods to go by rail. Now those groups have got what they want because the Channel tunnel will provide a rail link between the United Kingdom rail network and the whole of the continental rail network. It will provide the opportunity for substantially more goods to go by rail than in the past. Susan Hoyle, the director of Transport 2000, said that the CTG scheme offers the best opportunity since the war for a major renaissance by British Rail. The House knows that the longer the distance, the better prospects British Rail has of competing successfully. We should certainly see an environmental benefit from freight going by rail rather than road.
I have been questioned on jobs. If the hon. Member for West Bromwich, East (Mr. Snape) had left me more time, I could have dealt more effectively with that subject. For the next six years there will be more jobs on the ferries because trade is growing, more jobs in the Kent area because of the construction of the tunnel, more jobs in other parts of the country because they will have orders for engineering works, for British Rail work and for the merry-go-round to go on the train. All of that is a net benefit.
When the tunnel opens, there will be a short-term loss of about 1,600 jobs in Dover, but after that there will be a resumption of growth both in jobs and traffic on the ferries, which will mean that after 10 years there will be about 2,000 more jobs than at present. There will be huge opportunities for other parts of the country to compete more successfully because we will be able to get our goods more cheaply, efficiently and reliably into our export markets on the continent.
I turn to the Opposition amendment, and I do so with relish. It contains six carping criticisms. It complains that the Government have not published the full terms of the treaty and protocols. I see the hon. Member for West Bromwich, East nodding. The Opposition must know that it is not normal to do so in advance of signature of a treaty. No Governments do that and the previous Labour Government did not do it. There is no reason why we should depart from the established practice in that respect.
The amendment also refers to there being no Government commitment to finance British Rail. There is no need for the Government to finance British Rail when
726
it is doing something which is commercially viable and can raise the money out of its own resources. The Government will ensure that its external financing limit poses no problems for this investment.
The carping amendment complains about the effect on jobs. As I have just explained, there will be benefits for jobs in Kent and other parts of the country and there will be benefits for jobs when the Channel tunnel is open. I believe that hon. Members on both sides of the House should take note of the substantial advantages when British industry is not suffering from the disadvantage of having to drag all its imports across the Channel, and having to send all its exports with double handling at each port end because it could not get them into the export markets. I am convinced, and I believe that the House will agree, that the opportunity for increased competitiveness by British industry makes many thousands of jobs more secure than they would otherwise have been.
The amendment attacks the Government for not having set up a public inquiry. I have already explained to the House that if we had a public inquiry it would mean that the Secretary of State would appoint an inspector and the inspector would carry out an inquiry and report to the Secretary of State, who would take the decision in private. That decision would be binding, whereas now the highest tribunal in the land—the House of Commons—is able to decide the issues. It is laughable to suggest that there is a lack of consumer choice.
I heartily commend the project to the House. It will provide a faster, more reliable and cheaper link with the continent.
Question put, That the amendment be made:—
The House divided: Ayes 173, Noes 263.

Division No. 64]

[10.00 pm

AYES

Abse, Leo

Cook, Frank (Stockton North)

Adams, Allen (Paisley N)

Corbett, Robin

Archer, Rt Hon Peter

Corbyn, Jeremy

Ashley, Rt Hon Jack

Craigen, J. M.

Atkinson, N. (Tottenham)

Crowther, Stan

Bagier, Gordon A. T.

Cunliffe, Lawrence

Banks, Tony (Newham NW)

Cunningham, Dr John

Barron, Kevin

Davies, Ronald (Caerphilly)

Beckett, Mrs Margaret

Deakins, Eric

Bell, Stuart

Dewar, Donald

Benn, Rt Hon Tony

Dixon, Donald

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

Dobson, Frank

Bermingham, Gerald

Dormand, Jack

Bidwell, Sydney

Douglas, Dick

Blair, Anthony

Dubs, Alfred

Boothroyd, Miss Betty

Duffy, A. E. P.

Boyes, Roland

Dunwoody, Hon Mrs G.

Bray, Dr Jeremy

Eadie, Alex

Brown, Hugh D. (Provan)

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

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

Evans, John (St. Helens N)

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

Ewing, Harry

Brown, Ron (E'burgh, Leith)

Fatchett, Derek

Buchan, Norman

Faulds, Andrew

Caborn, Richard

Field, Frank (Birkenhead)

Callaghan, Rt Hon J.

Fields, T. (L'pool Broad Gn)

Callaghan, Jim (Heyw'd & M)

Fisher, Mark

Campbell, Ian

Flannery, Martin

Campbell-Savours, Dale

Foot, Rt Hon Michael

Carter-Jones, Lewis

Forrester, John

Clark, Dr David (S Shields)

Foster, Derek

Clarke, Thomas

Foulkes, George

Clelland, David Gordon

Fraser, J. (Norwood)

Clwyd, Mrs Ann

Freeson, Rt Hon Reginald

Cocks, Rt Hon M. (Bristol S)

Garrett, W. E.

Cohen, Harry

George, Bruce

Coleman, Donald

Gilbert, Rt Hon Dr John

Conlan, Bernard

Golding, John

727

Gourlay, Harry

O'Neill, Martin

Hamilton, James (M'well N)

Orme, Rt Hon Stanley

Hamilton, W. W. (Fife Central)

Park, George

Hancock, Michael

Parry, Robert

Hardy, Peter

Pavitt, Laurie

Harrison, Rt Hon Walter

Pendry, Tom

Haynes, Frank

Pike, Peter

Healey, Rt Hon Denis

Prescott, John

Heffer, Eric S.

Radice, Giles

Hogg, N. (C'nauld & Kilsyth)

Randall, Stuart

Holland, Stuart (Vauxhall)

Redmond, Martin

Home Robertson, John

Rees, Rt Hon M. (Leeds S)

Hoyle, Douglas

Richardson, Ms Jo

Hughes, Dr Mark (Durham)

Roberts, Ernest (Hackney N)

Hughes, Robert (Aberdeen N)

Robertson, George

Hughes, Roy (Newport East)

Robinson, G. (Coventry NW)

Hughes, Sean (Knowsley S)

Rogers, Allan

John, Brynmor

Rooker, J. W.

Jones, Barry (Alyn & Deeside)

Rowlands, Ted

Kilroy-Silk, Robert

Ryman, John

Kinnock, Rt Hon Neil

Sedgemore, Brian

Lambie, David

Sheerman, Barry

Lamond, James

Sheldon, Rt Hon R.

Leadbitter, Ted

Shore, Rt Hon Peter

Lewis, Ron (Carlisle)

Short, Ms Clare (Ladywood)

Lewis, Terence (Worsley)

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

Litherland, Robert

Silkin, Rt Hon J.

Lloyd, Tony (Stretford)

Skinner, Dennis

Lofthouse, Geoffrey

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

Loyden, Edward

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

McCartney, Hugh

Snape, Peter

McDonald, Dr Oonagh

Soley, Clive

McGuire, Michael

Spearing, Nigel

McKay, Allen (Penistone)

Stott, Roger

McKelvey, William

Strang, Gavin

MacKenzie, Rt Hon Gregor

Thomas, Dr R. (Carmarthen)

McNamara, Kevin

Thompson, J. (Wansbeck)

McTaggart, Robert

Thorne, Stan (Preston)

Madden, Max

Tinn, James

Marek, Dr John

Torney, Tom

Mason, Rt Hon Roy

Wardell, Gareth (Gower)

Maxton, John

Weetch, Ken

Maynard, Miss Joan

Welsh, Michael

Meacher, Michael

White, James

Michie, William

Williams, Rt Hon A.

Millan, Rt Hon Bruce

Winnick, David

Mitchell, Austin (G't Grimsby)

Young, David (Bolton SE)

Morris, Rt Hon A. (W'shawe)

Morris, Rt Hon J. (Aberavon)

Tellers for the Ayes:

Nellist, David

Mr. John McWilliam and

Oakes, Rt Hon Gordon

Mr. Ray Powell

O'Brien, William

NOES

Adley, Robert

Cranborne, Viscount

Alexander, Richard

Critchley, Julian

Alison, Rt Hon Michael

Currie, Mrs Edwina

Ancram, Michael

Dorrell, Stephen

Atkins, Rt Hon Sir H.

Douglas-Hamilton, Lord J.

Beaumont-Dark, Anthony

Durant, Tony

Biggs-Davison, Sir John

Eggar, Tim

Boscawen, Hon Robert

Emery, Sir Peter

Bottomley, Mrs Virginia

Fairbairn, Nicholas

Braine, Rt Hon Sir Bernard

Favell, Anthony

Brandon-Bravo, Martin

Fenner, Mrs Peggy

Buchanan-Smith, Rt Hon A.

Forman, Nigel

Buck, Sir Antony

Forsyth, Michael (Stirling)

Burt, Alistair

Forth, Eric

Butterfill, John

Fowler, Rt Hon Norman

Carlisle, Kenneth (Lincoln)

Fox, Marcus

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

Franks, Cecil

Cartwright, John

Fraser, Peter (Angus East)

Cash, William

Freeman, Roger

Chapman, Sydney

Freud, Clement

Churchill, W. S.

Fry, Peter

Clark, Dr Michael (Rochford)

Galley, Roy

Clegg, Sir Walter

Gardiner, George (Reigate)

Cope, John

Gardner, Sir Edward (Fylde)

Corrie, John

Garel-Jones, Tristan

Couchman, James

Gilmour, Rt Hon Sir Ian

728

Glyn, Dr Alan

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

Gow, Ian

Madel, David

Gower, Sir Raymond

Major, John

Grant, Sir Anthony

Malins, Humfrey

Greenway, Harry

Malone, Gerald

Gregory, Conal

Maples, John

Griffiths, Sir Eldon

Marlow, Antony

Griffiths, Peter (Portsm'th N)

Marshall, Michael (Arundel)

Grist, Ian

Mates, Michael

Ground, Patrick

Mather, Carol

Grylls, Michael

Maxwell-Hyslop, Robin

Gummer, Rt Hon John S

Mayhew, Sir Patrick

Hamilton, Hon A. (Epsom)

Mellor, David

Hamilton, Neil (Tatton)

Merchant, Piers

Hampson, Dr Keith

Miller, Hal (B'grove)

Hannam, John

Mills, Iain (Meriden)

Hargreaves, Kenneth

Mills, Sir Peter (West Devon)

Harris, David

Miscampbell, Norman

Harvey, Robert

Mitchell, David (Hants NW)

Haselhurst, Alan

Monro, Sir Hector

Hawkins, C. (High Peak)

Montgomery, Sir Fergus

Hawkins, Sir Paul (N'folk SW)

Moore, Rt Hon John

Hawksley, Warren

Morrison, Hon C. (Devizes)

Hayes, J.

Morrison, Hon P. (Chester)

Hayhoe, Rt Hon Barney

Murphy, Christopher

Heathcoat-Amory, David

Neale, Gerrard

Henderson, Barry

Nelson, Anthony

Heseltine, Rt Hon Michael

Neubert, Michael

Hickmet, Richard

Newton, Tony

Hicks, Robert

Nicholls, Patrick

Higgins, Rt Hon Terence L.

Norris, Steven

Hind, Kenneth

Oppenheim, Rt Hon Mrs S.

Hogg, Hon Douglas (Gr'th'm)

Osborn, Sir John

Holt, Richard

Ottaway, Richard

Hordern, Sir Peter

Owen, Rt Hon Dr David

Howard, Michael

Page, Sir John (Harrow W)

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

Patten, Christopher (Bath)

Howarth, Gerald (Cannock)

Pattie, Geoffrey

Howell, Rt Hon D. (G'ldford)

Pawsey, James

Howell, Ralph (Norfolk, N)

Penhaligon, David

Howells, Geraint

Percival, Rt Hon Sir Ian

Hubbard-Miles, Peter

Pollock, Alexander

Hunt, David (Wirral W)

Porter, Barry

Hunt, John (Ravensbourne)

Portillo, Michael

Hurd, Rt Hon Douglas

Powell, Rt Hon J. E.

Jenkin, Rt Hon Patrick

Powell, William (Corby)

Jessel, Toby

Prentice, Rt Hon Reg

Johnson Smith, Sir Geoffrey

Price, Sir David

Johnston, Sir Russell

Prior, Rt Hon James

Jones, Gwilym (Cardiff N)

Raffan, Keith

Jones, Robert (Herts W)

Raison, Rt Hon Timothy

Jopling, Rt Hon Michael

Rathbone, Tim

Joseph, Rt Hon Sir Keith

Renton, Tim

Kellett-Bowman, Mrs Elaine

Rhodes James, Robert

Kershaw, Sir Anthony

Rhys Williams, Sir Brandon

Key, Robert

Ridley, Rt Hon Nicholas

King, Roger (B'ham N'field)

Ridsdale, Sir Julian

Knight, Greg (Derby N)

Rippon, Rt Hon Geoffrey

Knight, Dame Jill (Edgbaston)

Roberts, Wyn (Conwy)

Knowles, Michael

Robinson, P. (Belfast E)

Knox, David

Roe, Mrs Marion

Lamont, Norman

Ross, Stephen (Isle of Wight)

Lang, Ian

Rossi, Sir Hugh

Lawler, Geoffrey

Rost, Peter

Lawrence, Ivan

Rowe, Andrew

Lee, John (Pendle)

Rumbold, Mrs Angela

Leigh, Edward (Gainsbor'gh)

Ryder, Richard

Lennox-Boyd, Hon Mark

Sackville, Hon Thomas

Lightbown, David

Sainsbury, Hon Timothy

Lilley, Peter

Sayeed, Jonathan

Livsey, Richard

Shaw, Giles (Pudsey)

Lloyd, Ian (Havant)

Shaw, Sir Michael (Scarb')

Luce, Rt Hon Richard

Shepherd, Richard (Aldridge)

Lyell, Nicholas

Sims, Roger

McCrindle, Robert

Smith, Tim (Beaconsfield)

McCurley, Mrs Anna

Soames, Hon Nicholas

MacGregor, Rt Hon John

Speed, Keith

MacKay, Andrew (Berkshire)

Spence, John

MacKay, John (Argyll & Bute)

Spencer, Derek

Maclean, David John

Spicer, Jim (Dorset W)

729

Squire, Robin

Wakeham, Rt Hon John

Stanbrook, Ivor

Waldegrave, Hon William

Stanley, Rt Hon John

Walden, George

Steel, Rt Hon David

Walker, Bill (T'side N)

Steen, Anthony

Wallace, James

Stern, Michael

Waller, Gary

Stevens, Lewis (Nuneaton)

Ward, John

Stewart, Allan (Eastwood)

Wardle, C. (Bexhill)

Stewart, Andrew (Sherwood)

Watson, John

Stewart, Ian (Hertf'dshire N)

Wells, Bowen (Hertford)

Stokes, John

Wells, Sir John (Maidstone)

Sumberg, David

Wheeler, John

Taylor, John (Solihull)

Whitney, Raymond

Temple-Morris, Peter

Wiggin, Jerry

Terlezki, Stefan

Wilkinson, John

Thatcher, Rt Hon Mrs M.

Winterton, Mrs Ann

Thomas, Rt Hon Peter

Winterton, Nicholas

Thompson, Donald (Calder V)

Wolfson, Mark

Thompson, Patrick (N'ich N)

Wood, Timothy

Thorne, Neil (Ilford S)

Woodcock, Michael

Thornton, Malcolm

Yeo, Tim

Townsend, Cyril D. (B'heath)

Young, Sir George (Acton)

Trippier, David

Younger, Rt Hon George

Twinn, Dr Ian

van Straubenzee, Sir W.

Tellers for the Noes:

Vaughan, Sir Gerard

Mr. Peter Lloyd and

Viggers, Peter

Mr. Francis Maude.

Waddington, David

Question accordingly negatived.
Main Question put:—
The House divided: Ayes 268, Noes 107.

Division No. 65]

[10.13 pm

AYES

Adley, Robert

Fraser, Peter (Angus East)

Alexander, Richard

Freeman, Roger

Alison, Rt Hon Michael

Freud, Clement

Ancram, Michael

Fry, Peter

Atkins, Rt Hon Sir H.

Galley, Roy

Beaumont-Dark, Anthony

Gardiner, George (Reigate)

Biggs-Davison, Sir John

Gardner, Sir Edward (Fylde)

Boscawen, Hon Robert

Garel-Jones, Tristan

Bottomley, Mrs Virginia

Gilbert, Rt Hon Dr John

Braine, Rt Hon Sir Bernard

Gilmour, Rt Hon Sir Ian

Brandon-Bravo, Martin

Glyn, Dr Alan

Buchanan-Smith, Rt Hon A.

Gow, Ian

Buck, Sir Antony

Gower, Sir Raymond

Burt, Alistair

Grant, Sir Anthony

Butterfill, John

Greenway, Harry

Campbell-Savours, Dale

Gregory, Conal

Carlisle, Kenneth (Lincoln)

Griffiths, Sir Eldon

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

Griffiths, Peter (Portsm'th N)

Cartwright, John

Grist, Ian

Cash, William

Ground, Patrick

Chapman, Sydney

Grylls, Michael

Churchill, W. S.

Gummer, Rt Hon John S

Clark, Dr Michael (Rochford)

Hamilton, Hon A. (Epsom)

Clegg, Sir Walter

Hamilton, Neil (Tatton)

Cope, John

Hampson, Dr Keith

Corrie, John

Hannam, John

Couchman, James

Hargreaves, Kenneth

Cranborne, Viscount

Harris, David

Critchley, Julian

Harvey, Robert

Currie, Mrs Edwina

Haselhurst, Alan

Dorrell, Stephen

Hawkins, C. (High Peak)

Douglas-Hamilton, Lord J.

Hawkins, Sir Paul (N'folk SW)

Durant, Tony

Hawksley, Warren

Eggar, Tim

Hayes, J.

Emery, Sir Peter

Hayhoe, Rt Hon Barney

Fairbairn, Nicholas

Heathcoat-Amory, David

Favell, Anthony

Henderson, Barry

Fenner, Mrs Peggy

Heseltine, Rt Hon Michael

Forman, Nigel

Hickmet, Richard

Forsyth, Michael (Stirling)

Hicks, Robert

Forth, Eric

Higgins, Rt Hon Terence L.

Fowler, Rt Hon Norman

Hind, Kenneth

Fox, Marcus

Hogg, Hon Douglas (Gr'th'm)

Franks, Cecil

Holt, Richard

730

Hordern, Sir Peter

Oppenheim, Rt Hon Mrs S.

Howard, Michael

Osborn, Sir John

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

Ottaway, Richard

Howarth, Gerald (Cannock)

Owen, Rt Hon Dr David

Howell, Rt Hon D. (G'ldford)

Page, Sir John (Harrow W)

Howell, Ralph (Norfolk, N)

Patten, Christopher (Bath)

Howells, Geraint

Pattie, Geoffrey

Hubbard-Miles, Peter

Pawsey, James

Hunt, David (Wirral W)

Penhaligon, David

Hunt, John (Ravensbourne)

Percival, Rt Hon Sir Ian

Hurd, Rt Hon Douglas

Pollock, Alexander

Jenkin, Rt Hon Patrick

Porter, Barry

Jessel, Toby

Portillo, Michael

Johnson Smith, Sir Geoffrey

Powell, William (Corby)

Johnston, Sir Russell

Prentice, Rt Hon Reg

Jones, Gwilym (Cardiff N)

Price, Sir David

Jones, Robert (Herts W)

Prior, Rt Hon James

Jopling, Rt Hon Michael

Raffan, Keith

Joseph, Rt Hon Sir Keith

Raison, Rt Hon Timothy

Kellett-Bowman, Mrs Elaine

Rathbone, Tim

Kershaw, Sir Anthony

Renton, Tim

Key, Robert

Rhodes James, Robert

King, Roger (B'ham N'field)

Rhys Williams, Sir Brandon

Knight, Greg (Derby N)

Ridley, Rt Hon Nicholas

Knight, Dame Jill (Edgbaston)

Ridsdale, Sir Julian

Knowles, Michael

Rippon, Rt Hon Geoffrey

Knox, David

Roberts, Wyn (Conwy)

Lambie, David

Robertson, George

Lamont, Norman

Robinson, Mark (N'port W)

Lang, Ian

Roe, Mrs Marion

Lawler, Geoffrey

Ross, Stephen (Isle of Wight)

Lawrence, Ivan

Rossi, Sir Hugh

Lee, John (Pendle)

Rowe, Andrew

Leigh, Edward (Gainsbor'gh)

Rumbold, Mrs Angela

Lennox-Boyd, Hon Mark

Ryder, Richard

Lightbown, David

Sackville, Hon Thomas

Lilley, Peter

Sayeed, Jonathan

Livsey, Richard

Shaw, Giles (Pudsey)

Lloyd, Ian (Havant)

Shaw, Sir Michael (Scarb')

Lloyd, Peter (Fareham)

Shepherd, Richard (Aldridge)

Luce, Rt Hon Richard

Sims, Roger

Lyell, Nicholas

Smith, Tim (Beaconsfield)

McCrindle, Robert

Soames, Hon Nicholas

McCurley, Mrs Anna

Speed, Keith

MacGregor, Rt Hon John

Spence, John

MacKay, Andrew (Berkshire)

Spencer, Derek

MacKay, John (Argyll & Bute)

Spicer, Jim (Dorset W)

Maclean, David John

Squire, Robin

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

Stanbrook, Ivor

Madel, David

Stanley, Rt Hon John

Major, John

Steel, Rt Hon David

Malins, Humfrey

Steen, Anthony

Malone, Gerald

Stern, Michael

Maples, John

Stevens, Lewis (Nuneaton)

Marek, Dr John

Stewart, Allan (Eastwood)

Marlow, Antony

Stewart, Andrew (Sherwood)

Marshall, Michael (Arundel)

Stewart, Ian (Hertf'dshire N)

Mates, Michael

Stokes, John

Mather, Carol

Sumberg, David

Maude, Hon Francis

Taylor, John (Solihull)

Maxwell-Hyslop, Robin

Temple-Morris, Peter

Mayhew, Sir Patrick

Terlezki, Stefan

Mellor, David

Thatcher, Rt Hon Mrs M.

Merchant, Piers

Thomas, Rt Hon Peter

Miller, Hal (B'grove)

Thompson, Donald (Calder V)

Mills, Iain (Meriden)

Thompson, Patrick (N'ich N)

Mills, Sir Peter (West Devon)

Thorne, Neil (Ilford S)

Miscampbell, Norman

Thornton, Malcolm

Mitchell, David (Hants NW)

Townend, John (Bridlington)

Monro, Sir Hector

Townsend, Cyril D. (B'heath)

Montgomery, Sir Fergus

Trippier, David

Moore, Rt Hon John

Twinn, Dr Ian

Morrison, Hon C. (Devizes)

van Straubenzee, Sir W.

Morrison, Hon P. (Chester)

Vaughan, Sir Gerard

Murphy, Christopher

Viggers, Peter

Neale, Gerrard

Waddington, David

Nelson, Anthony

Wakeham, Rt Hon John

Newton, Tony

Waldegrave, Hon William

Nicholls, Patrick

Walden, George

Norris, Steven

Walker, Bill (T'side N)

731

Wallace, James

Winterton, Mrs Ann

Waller, Gary

Winterton, Nicholas

Ward, John

Wolfson, Mark

Wardle, C. (Bexhill)

Wood, Timothy

Watson, John

Woodcock, Michael

Wells, Bowen (Hertford)

Yeo, Tim

Wells, Sir John (Maidstone)

Young, Sir George (Acton)

Wheeler, John

Younger, Rt Hon George

Whitney, Raymond

Wiggin, Jerry

Tellers for the Ayes:

Wilkinson, John

Mr. Tim Sainsbury and

Williams, Rt Hon A.

Mr. Michael Neubert.

NOES

Adams, Allen (Paisley N)

Fatchett, Derek

Aitken, Jonathan

Field, Frank (Birkenhead)

Ashley, Rt Hon Jack

Fields, T. (L'pool Broad Gn)

Atkinson, N. (Tottenham)

Flannery, Martin

Banks, Tony (Newham NW)

Foot, Rt Hon Michael

Barron, Kevin

Foulkes, George

Beckett, Mrs Margaret

Freeson, Rt Hon Reginald

Benn, Rt Hon Tony

Gale, Roger

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

Garrett, W. E.

Bermingham, Gerald

Hamilton, James (M'well N)

Bidwell, Sydney

Hamilton, W. W. (Fife Central)

Boyes, Roland

Hancock, Michael

Brown, Hugh D. (Provan)

Hardy, Peter

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

Harrison, Rt Hon Walter

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

Haynes, Frank

Brown, Ron (E'burgh, Leith)

Heffer, Eric S.

Caborn, Richard

Hogg, N. (C'nauld & Kilsyth)

Callaghan, Jim (Heyw'd & M)

Holland, Stuart (Vauxhall)

Carter-Jones, Lewis

Hoyle, Douglas

Clark, Dr David (S Shields)

Hughes, Sean (Knowsley S)

Clarke, Thomas

Jones, Barry (Alyn & Deeside)

Cocks, Rt Hon M. (Bristol S)

Kilroy-Silk, Robert

Cohen, Harry

Lamond, James

Cook, Frank (Stockton North)

Lewis, Terence (Worsley)

Corbett, Robin

Litherland, Robert

Corbyn, Jeremy

Lloyd, Tony (Stretford)

Craigen, J. M.

Lofthouse, Geoffrey

Crowther, Stan

Loyden, Edward

Davies, Ronald (Caerphilly)

McCartney, Hugh

Deakins, Eric

McKay, Allen (Penistone)

Dixon, Donald

MacKenzie, Rt Hon Gregor

Douglas, Dick

McNamara, Kevin

Duffy, A. E. P.

McWilliam, John

Dunwoody, Hon Mrs G.

Maxton, John

Eadie, Alex

Maynard, Miss Joan

Evans, John (St. Helens N)

Michie, William

Ewing, Harry

Millan, Rt Hon Bruce

732

Mitchell, Austin (G't Grimsby)

Sheerman, Barry

Moate, Roger

Sheldon, Rt Hon R.

Morris, Rt Hon A. (W'shawe)

Silkin, Rt Hon J.

Oakes, Rt Hon Gordon

Skinner, Dennis

O'Brien, William

Taylor, Teddy (S'end E)

O'Neill, Martin

Thomas, Dr R. (Carmarthen)

Park, George

Thompson, J. (Wansbeck)

Parry, Robert

Thorne, Stan (Preston)

Pavitt, Laurie

Torney, Tom

Pendry, Tom

Wardell, Gareth (Gower)

Pike, Peter

Welsh, Michael

Powell, Raymond (Ogmore)

White, James

Redmond, Martin

Winnick, David

Rees, Rt Hon M. (Leeds S)

Young, David (Bolton SE)

Rees, Rt Hon Peter (Dover)

Richardson, Ms Jo

Tellers for the Noes:

Roberts, Ernest (Hackney N)

Mr. Max Madden and

Robinson, G. (Coventry NW)

Mr. Dave Nellist.

Ryman, John

Question accordingly agreed to.
Resolved,
This this House approves the Government's White paper on the Channel Fixed Link (Cmnd. 9735).

BUSINESS OF THE HOUSE
Ordered,
That, at this day's sitting, the Australia Bill [Lords] may be proceeded with, though opposed, until any hour. — [Mr. Archie Hamilton.]

Orders of the Day

  AUSTRALIA BILL [LORDS]
  Considered in Committee; reported, without amendment.
  Motion made, and Question, That the Bill be now read the Third time, put and agreed to.
  Bill accordingly read the Third time, and passed, without amendment.

  Inner London Education Authority (Precept Limitation)
  10.27 pm
  The Secretary of State for Education and Science (Sir Keith Joseph): I beg to move,
  That the draft Precept Limitation (Prescribed Maximum) (Inner London Education Authority) Order 1986, which was laid before this House on 29th January, be approved.
  This order limits the precept which may be made for the financial year 1986–87 by the new Inner London education authority which takes over from the old ILEA on 1 April 1986. A shadow authority—the Inner London interim education authority is responsible for issuing this precept. Under the Local Government Act 1985, the new ILEA is automatically designated for precept limitation for the first three years of its existence—from 1986–87 to 1988–89. Because it is, in effect, a single service authority, I am responsible for this limitation. Its purpose is to protect ratepayers from high rates caused by high spending. Lower business rates also protect jobs. Although ILEA is automatically designated, it would, in view of its expenditure, have come well within the criteria for selective rate capping this year. Its 1985–86 budget was 5 per cent. above its expenditure target, itself related to the authority's past spending, and 70 per cent. above GRE.
  I shall describe briefly the processes leading to this draft order. The Government have not reached a quick or sudden decision. Consideration began in July last year when I announced my intention to propose an expenditure level for the new ILEA for 1986–87 of £902 million. I confirmed that figure in September, as soon as the interim ILEA was established. At the end of October, the interim ILEA applied for a redetermined expenditure level, citing a range of £995 million to £1,025 million. I considered its case, and in December redetermined the expenditure level at £915 million. My conclusions were based on judgments which differed sharply from those of the interim ILEA in three main areas. First and most important, I took the view that the volume of the ILEA's expenditure should be substantially reduced. Secondly, I believed that the abolition of the GLC need not substantially increase ILEA's central administrative costs above its already high levels. Thirdly, I used the Government's forecast of inflation next year at 4·5 per cent. rather than the significantly higher figure favoured by the interim ILEA. In the event, I added £13 million to the expenditure level for largely technical reasons, but did not agree to make the substantial increase which the interim ILEA requested to maintain its expenditure at its present level.
  Following the redetermination of the expenditure level, I proposed a precept maximum of 76·5p, also in December. That proposed precept maximum was derived from the redetermined expenditure level and from an assessment of the reserves available to the authority. It implied drawing down £39 million from reserves to relieve the precept.
  In January, the interim ILEA refused the proposed precept maximum of 76·5p, and presented further evidence in support of a substantially higher precept. I examined all the evidence afresh, including further representations from the ILEA, and decided that it would be appropriate to assume the drawing of slightly less from
  734
  reserves in support of the precept. Therefore, I invited the interim ILEA to agree to a precept maximum of 77·25p, which was based on the same redetermined expenditure level of £915 million, but assumed the drawing of only £31 million from reserves.
  The interim ILEA has refused to accept the new figure. In the absence of agreement, I decided to lay the draft order embodying a figure of 77·25p, which is now before the House. I did that because I wanted to establish a final precept maximum before the date of 15 February set out in the Rates Act 1984, in order to end uncertainty and to give the interim ILEA time to draw up a budget consistent with the precept maximum. At the same time, I made it clear to the interim ILEA that my door was open for further discussions.
  This afternoon I met members of the interim ILEA. They proposed to me that we should agree on a precept maximum of 80·75p. That would be an increase of some 4·5 per cent. above the ILEA precept for 1985-86. It could be used to finance a budget of some £950 million, if about £27 million were drawn from reserves. Such a budget would be some £45 million less than the interim ILEA has previously claimed that it needs to spend. I have carefully considered that proposition. However, I have told the ILEA that I do not believe that extra expenditure of £35 million above the expenditure level which I redetermined in December would be necessary to maintain existing standards of education in inner London. Nor do I believe that the ratepayer should be asked to pay 4·5 per cent. more in 1986–87. Therefore, my judgment remains that the precept maximum of 77·25p embodied in the draft order is appropriate. I shall now explain why I consider the precept maximum of 77·25p to be appropriate, in terms both of the level of expenditure which it implies and of the effect on the ratepayer.
  The ILEA has to contend with grave problems in discharging its duties to educate the people of inner London. The Government have never denied that. Our own assessments of cost allow for the extra costs imposed by concentrations of ethnic minorities, one-parent families, bad housing conditions and family poverty. But the ILEA spends far more than other inner city authorities. Even allowing for the extra cost of salaries in London, it has been spending some 30 per cent. more per pupil than Manchester, Liverpool or Newcastle, and some 60 per cent. more per pupil than Birmingham. ILEA's pupil-teacher ratios are markedly more generous than the average for other inner city authorities. The differences between ILEA and others in non-teaching staff ratios are even more marked. Very large capitation allowances and a perverse charging policy also swell the authority's expenditure. It is unique among LEAs in having held its school meal charge at 35p since 1980.
  The ILEA cannot justify this extra cost to the ratepayer in terms of the quality of its service. The evidence suggests that, when account is taken of pupils' circumstances, the attainment of pupils in ILEA schools is no better than that of pupils in comparable inner city authorities. The fact is that the ILEA has not made effective use of the huge sums which it has levied from its ratepayers. Let me give an example. The most important asset for any LEA is a well-managed teacher force of good quality, properly deployed. But the ILEA has allowed surplus teachers to accumulate on the staffs of its schools. That is not good either for the work of the schools or the morale of the teachers.

  735
  The Government have made clear over a number of years their wish to see lower expenditure by the ILEA. Pupil numbers have fallen by more than 20 per cent. in six years, but over the same period the authority's expenditure has been more or less steady in real terms. Its teacher force has indeed reduced but at much less than in proportion to pupil numbers so that pupil-teacher ratios have improved by 12·5 per cent. from the generous levels of 1978–79. Instead of using even the small saving in teacher numbers to reduce the burden on the ratepayer, the authority has added it back elsewhere in its budget.
  My expenditure level implied a 6 per cent. reduction in the volume of ILEAs expenditure. It cannot seriously be claimed that such a cut would of itself put at risk the authority's performance of its statutory duties. Expenditure per pupil would still be more than 20 per cent. above that of Manchester, Liverpool or Newcastle. More serious perhaps is the ILEA claim that the movement all at once to the lower level of expenditure would cause serious disruption. I assure the House that other local education authorities have achieved reductions from one year to the next of 6 per cent. and achieved them from a base level of expenditure much lower than the ILEA's. But the ILEA has argued—
  Mr. Simon Hughes (Southwark and "Bermondsey): Will the Secretary of State give way?
  Sir Keith Joseph: I would rather not do so. I shall ask the House to allow me to reply at the end of the debate and I shall take questions then. I want to read this carefully prepared explanation of why I am imposing a precept maximum on the ILEA. I shall answer questions at the end of the debate, subject to the House giving me leave to reply.
  The ILEA has argued that those other authorities took longer to prepare their reductions and that it cannot be expected to achieve a 6 per cent. reduction in 1986–87 starting from now. I ask the House to assess the worth of that argument in the light of what the authority has done since Parliament first gave the Government powers to limit rates and precepts.
  There has been ample time to undertake a planned and managed reduction of its expenditure in response to Government policies. The expenditure level set for 1985–86 implied substantial reductions. The authority chose to take no action, but to rely upon its limited reserves to keep up spending. The expenditure level for 1986–87 has been known since July; but, instead of planning towards a budget in line with it, the interim ILEA spent months drawing up a budget at constant volume, so the ILEA has made its own task harder. Notwithstanding that, the Government have concluded that so high is ILEA's present level of expenditure that a volume reduction of 6 per cent. is practicable and attainable even from a standing start. I am satisfied that it remains appropriate to ask for that.
  Mr. Hughes rose—
  Sir Keith Joseph: In reaching my conclusions, I also had regard to the impact on ratepayers. Rate bills in inner London are high. Much of that is accounted for by the ILEA precept. The average domestic ratepayer is paying a sum approaching £250 a year on top of what he pays for the services of his local borough, the Metropolitan police and LRT. The average shop is paying about £1,500, and
  736
  the average office £11,000. Large commercial enterprises, of course face much larger bills. In total, the burden of the ILEA on inner London ratepayers is almost £900 million a year.
  The ratepayer should be protected from further increases. The precept maximum incorporated in the draft order represents a standstill on the ILEA precept for 1985–86, so the average ratepayer should pay the same in cash as he paid in 1985–86. In contrast, the sort of figures considered by the interim ILEA—and which I do not doubt it would have imposed but for precept limitation — would have entailed an increase in the precept of some 16 per cent. That would have meant another £40 for the average domestic ratepayer, £250 for the average shop and £1,750 for the average office. Ratepayers should not have to pay in this way for the expansion of an already extravagant service.
  That is why this draft order has been laid before the House, and that is why I ask the House to approve it.
  10.40 pm
  Mr. Giles Radice: The Opposition will be voting against the order, because that is the only way open to us to express our opposition to the level of precept that the Secretary of State is imposing on ILEA.
  It is wrong in principle for a Secretary of State to impose by order on the citizens of inner London his diktat on the maximum that should be spent on education. It is one thing for central Government to have a view on the minimum standards, although the Government remained disappointingly silent when the inadequacies of the Somersets, the Herefords and Worcestershires, the Kent, and the like have been exposed by the Secretary of State's advisers, the HMI. It is quite another for central Government to impose their will on maximum standards of provision, as under the order.
  It is ironic that this Secretary of State, who has spoken and written so much about the overmighty state, should in practice be the Minister who has assumed the most extensive centralising powers. He obviously believes the dictum that Elizabeth house knows best. In this case, Elizabeth house not only does not know best, but has little idea of the likely impact of the cut being imposed on ILEA.
  Mr. Tony Marlow rose—
  Mr. Radice: I shall not give way, as I should like to develop my speech.
  The reality, as the Secretary of State knows, is that ILEA is already planning to make savings of around £18 million, as a consequence of falling rolls and improved efficiency. Even the Secretary of State admits that the consequence of the imposing of the precept of 77·25p in the pound will mean volume cuts of 6 per cent., or £55 million in the coming year. The scale of cuts is likely to be considerably greater. First, ILEA believes that the Department has underestimated by £13 million the extra cost of setting up the new education authority. Secondly, it is clear that the 4·5 per cent. that the right hon. Gentleman mentioned, which he is assuming for pay and price increases in the coming year, does not take account of the spill-over effect of the provisional teacher's settlement for this year—which I remind the House is end-loaded to 8·5 per cent.—or of the manual workers' settlement.

  737
  If we look a year ahead, we see that the Secretary of State has often told the House about his offer of Government money for a deal on structure and conditions of service, but if such a settlement is reached the Inner London education authority will not benefit because it does not receive rate support grant. Indeed, it stands to lose because it will be bound by any agreement that may be reached. In other words, a long-term settlement next year would, in ILEA's case, be at the expense of further cuts. Is the Secretary of State aware of this? As he is to answer questions at the end of the debate, he might care to write down that one.
  The Secretary of State has argued that the kind of contingencies to which I have referred will be fully covered by ILEA's balances, but, as Maurice Stonefrost, the clerk to the authority, pointed out in a letter to Sir David Hancock, the permanent secretary at the Department of Education and Science, the level of balances assumed to be satisfactory by the DES are, in his professional judgment, dangerously low. In fact, there is a real danger that the authority would be faced, in the words of Maurice Stonefrost, with
  "a deficit financing position in its budget process."
  In other words, it could run out of money during the coming year. Are this Government and this Secretary of State trying to impose an illegal budget on ILEA? I should like the Secretary of State to answer that question, too.
  The consequences of even the level of cuts envisaged by the Secretary of State are likely to be extremely disruptive. The highly respected ILEA education officer, William Stubbs—I do not know whether the Secretary of State has ever run an education authority, so I should prefer to take the education officer's word against his, if he does not mind—has told Sir David Hancock that this scale of reductions would mean that the authority would be able to replace only one in three of any staff who leave the service in 1986–87. He said:
  "It can be forecast with certainty that these vacancies would not occur evenly and many schools and colleges would be unable to replace key members of staff during the course of the financial year. Not only would curtailment of the education service become inevitable, but the maintenance of adequate standards of provision would be put at risk."
  Mr. Marlow: Will the hon. Gentleman give way?
  Mr. Radice: No, I should like to finish this quotation. I shall then give way. Mr. Stubbs then said:
  "I would have to advise of the probability of the service breaking down in some areas, with the authority being unable to guarantee to fulfil at all times the whole range of its statutory obligations, leading to the near certainty of legal challenge for such failure to comply with its duties."
  Again, are this Government trying to force ILEA to ignore its statutory obligations and to act illegally? I shall now give way to the hon. Gentleman.
  Mr. Marlow: I am very grateful to the hon. Gentleman for giving way. He knows that my right hon. Friend the Secretary of State for Education and Science is referring to a 6 per cent. cut in expenditure. The hon. Gentleman says that it may be a little more than that; he may say that there will be a 10 per cent. cut in expenditure. ILEA spends roughly twice as much on primary school pupils as is spent upon primary school pupils in my constituency. My right hon. Friend has said that even allowing for London weighting this is 50 per cent. more than the
  738
  average, and it is 30 per cent. more than is spent in Newcastle upon Tyne and 20 per cent. more than is spent in Birmingham. [HON. MEMBERS: "60 per cent."] Yes, 60 per cent. more than is spent in Birmingham. How on earth does the hon. Gentleman justify this vast level of extravagance by ILEA, even after the cuts?
  Mr. Radice: ILEA is one of the few authorities which the Secretary of State's own advisers, Her Majesty's inspectorate, believe is spending up to the right kind of levels.
  In that context it should be highly significant to the Secretary of State that even the London chamber of commerce and industry is concerned that cuts of that magnitude should not be compressed into one year, as the Secretary of State is trying to do.
  Given the advice being offered to him, not only by respected officers of ILEA but by London business men and industrialists, the onus is on him to prove that such cuts will not harm or disrupt the education of Londoners, and he has not proved that tonight.
  To any fair-minded person, it is frankly bizarre that the Government propose to cut at least £55 million in one year at a time when above all ILEA needs stability. The damage that has already been done to children's education by the teachers' dispute will in ILEA's case, be greatly compounded by the disruption of making the Secretary of State's cuts. The tragedy is that at a time when "firm and efficient management"—the Secretary of State's words — ought to be concentrated on establishing the new service and on raising standards in inner London, it will have to be spent on implementing cuts.
  In that connection, let me quote a letter from the vice-chair of the parents' central consultative committee of ILEA. I believe that he has written to the Secretary of State tonight and that the letter has been endorsed by the chairs of all the parents' consultative committees of ILEA at a meeting earlier this evening. He says:
  "Many of us remember what you"—
  the Secretary of State—
  "told parents at Central Hall on 10th May 1984."—
  I was at that meeting, so I can remember too.
  "'The Government of the day will judge what can reasonably be expected as a reduction in ILEA's spending without damaging the quality of education, and that is the assurance I can give you.'
  It is the judgment of the Authority's most senior officers that, in fact, the reduction expected (indeed, demanded) would not only damage the quality of education, but could lead to the breakdown of the service during the course of the year.
  The ILEA has demonstrated its willingness to make savings that do not damage children's education, and we know that the judgment of these officers is based on a intimate knowledge of all the relevant facts. We therefore feel that there is an overwhelming obligation upon you to reconsider the decision you have made.
  It is quite clear that, unless the maximum precept is raised from the proposed 77·25p, the Authority is likely to be in an impossible situation before the end of the year.
  Whilst your judgment contradicts that of those responsible for running the ILEA's services, we feel that— in order to lend any credibility to your assurance of May '84—there is also an overwhelming obligation upon you to explain to parents (whose views you have so often claimed to respect) the reasoning behind your judgment, and to demonstrate that the quality of our children's education will not be damaged by the reduction you propose."
  If the Secretary of State will not answer our questions, he might at least answer the points put to him by London parents.
  But, of course, the Secretary of State has heard all those facts before. Throughout the past two months he has learnt

  739
  them from ILEA officials and councils. On Friday he heard them from my right hon. Friend the Leader of the Opposition and myself when he met us at Elizabeth house.
  Only a few hours ago, as the Secretary of State has told us, ILEA's leader, Mrs. Frances Morrell, and other ILEA councillors met with him to discuss compromise proposals by which the maximum precept would be raised to 80·75p. This would require the authority to contain within its budget the additional cost it faces in 1986–87 over and above the general rate of inflation.
  ILEA accepts that it needs to control costs, but the Secretary of State is not prepared to give anything. His only response has been to raise the maximum precept by a marginal amount, as he has had to admit. We reject his approach to London's education and the nation's education. It is true that ILEA spends more than other education authorities, and so it should. On almost every count, ILEA has more to cope with—seven out of 10 of the most disadvantaged boroughs are in inner London; the population density is 10 times the national average; the number of one-parent families is twice the national average; the number of children taking school meals is twice the national average; and the number of children speaking English as a second language is four times the national average. Despite those problems, ILEA has massive achievements to its credit—extensive nursery provision, a good pupil-teacher ratio, generous provision for pupils with special needs and the most extensive adult education service in the United Kingdom.
  The Secretary of State usually points to examination results. I think that he would have been a little more generous if he had said that the results in 1983 were the best since 1978 and that progress was maintained in 1984. Of course, as the Hargreaves, Thomas and Fish reports show, much more needs to be done in London education, as in the rest of the United Kingdom. I should have thought, as would most fair-minded people, that the creation of a directly elected authority would be an exciting opportunity to improve further the educational prospects for London's children. Instead, the Secretary of State, with his singular combination of ideological obsession and executive incompetence, typically plans to add to the chaos he has already created. Such recklessness can come only from a Minister who knows that his days are numbered.
  It would be better for the Secretary of State and, more importantly, for the nation's education if he were to go now before he does any further damage. Whatever happens to the right hon. Gentleman, there is a ray of hope—Londoners will have the opportunity to say what they think about the Government's educational policies in the coming ILEA elections, which will be the first education election for a century, and in the coming Fulham by-election. I am confident what the people's verdict will be.
  10.58 pm
  Mr. John Maples: The hon. Member for Durham, North (Mr. Radice) has repeated some of the current crop of ILEA scare stories about the irreparable damage that will be done to London education becaue of these proposals. I think that we would be justified in inviting the hon. Gentleman to remember that, about this time last year, the same prophecies of doom and gloom were emanating from county hall about the irreparable damage done by last year's expenditure limits, and none of them has been borne out.
  740
  Only days ago, the controlling group on ILEA was suggesting that if ILEA could not spend £995 million, irreparable damage would be done. Now, apparently £950 million is enough to stop irreparable damage from being done. The amount has fallen by approximately £45 million in about 48 hours.
  The question to which the hon. Member for Durham, North singularly failed to address himself—and whoever sums up for the Opposition must address this question—is: why does it cost 60 per cent. more on a unit cost basis to educate a child in an ILEA secondary school than it costs in Birmingham, and 40 per cent. more than in some outer London boroughs? [Interruption.]
  I do not know what the hon. Member for Durham. North said from his sedentary position, but if he is saying that it costs more to do things and there are more problems in central London, we would agree. But are there 60 per cent. more problems in central London than there are in Birmingham?
  Mr. Frank Dobson: Is the hon. Gentleman aware that the costs of the Metropolitan police are disproportionately greater than the costs of the police in areas outside London? So it is with the costs of the ILEA.
  Mr. Maples: I was not aware of that. I should not have thought that the same considerations would apply to education. If what the hon. Gentleman says is true, it may be an argument for reducing the costs of the Metropolitan police, not for increasing the costs of education.
  The hon. Gentleman and the Labour party have consistently failed to address the question: why does it cost so much more? Last year expenditure was reduced by 4 or 5 per cent., and none of those adverse consequences occurred. It is not credible to suggest that a further 4 or 5 per cent. reduction this year will result in irreparable damage. My right hon. Friend has it about right. It is reasonable to ask that expenditure should stay at about the same in cash terms.
  The ILEA is putting about serious scare stories regarding the consequences of this measure, as it did last year, and that is worrying parents a great deal. It would help if my right hon. Friend would itemise the differences between authorities such as Birmingham and London, and show how savings could be made in a way which will not damage education. We know that they can be made.
  There are considerable differences in staffing ratios, charges for some adult education courses and expenditure on property and property maintenance in ILEA. Therefore, considerable savings can be made. I invite my right hon. Friend to go into those matters in a little more detail so that parents will realise that the authority can make modest savings without damaging education.
  Mr. Chris Smith: The hon. Gentleman's constituents and mine have to contribute through their taxes to other children around the country, but they have to fund the entire education service of inner London through their rates. How does he justify that difference?
  Mr. Maples: I was coming to that point. Now that the ILEA is rate capped, it is difficult to justify the fact that it does not receive any rate support grant. The target and penalty system was designed to encourage local authorities to spend less—[Interruption.] It would probably help

  741
  me to make the point if I were not subject to barracking from the Opposition. Despite the fact that I believe that the ILEA could make some modest savings without damaging education, it could not cut its expenditure to the point where it would receive any of this grant. If I remember the figures correctly, it would have to cut its expenditure by about £250 million to £300 million before it started to receive grant. It would have to reduce its expenditure to under £500 million to receive its full entitlement to rate support grant.
  I should like my right hon. Friend to discuss with our right hon. Friend the Secretary of State for the Environment whether, now that ILEA has been rate capped and its total expenditure is under control and public expenditure nationally has been brought under control, it is unreasonable that it should receive no rate support grant. It is the only local education authority which does not receive any.
  All of us, including Opposition Members, would like to see the ILEA receive the maximum possible value for money. One of the ways of achieving that would be to delegate far more control of expenditure, the budget and the budget management to schools, and to bypass the county hall-ILEA bureaucracy as much as possible.
  I have tried out that idea on a few heads in my constituency, and almost without exception they have welcomed it and asked to be given the chance to try. If that is too radical to be implemented, on the basis that one should never do anything radical for the first time, we could perhaps try it with a few schools where it is felt that their make-up and size and the quality of the head could make some such system work. It would enable money to be spent in a particular school in a way which related to the needs of that school as perceived by the head, the staff and the governors—the people who are close to where the effect of those decisions will be felt—not at county hall.
  Mr. Harry Greenway: Does my hon. Friend agree that the alternative use of resources by schools—money which has been spent at the discretion of heads in consultation with staff — has been a satisfactory scheme, the bureaucracy at county hall having been kept out of it?
  Mr. Maples: My hon. Friend gives a good example, but the AUR programmes in most schools represent a very small part of the money spent on the schools. It seems to me that that principle can be radically extended to give a particular school the total amount of money which is to be spent on that school by the local authority during a term, year or month, or whatever period of time it relates to, and for the school to decide how to spend it. It obviously has to do certain things—teach certain subjects and employ teachers — but basically the school can decide its priorities. First, that would break the monolithic nature of ILEA, which worries many of us. Secondly, we would get better value for money with a far greater degree of satisfaction on the part of head teachers, governors and staff in the schools which actually make the decisions.
  The freeze on ILEA's spending in cash terms is acceptable and achievable without any of the horrendous results predicted by the Opposition. However, it would help if my right hon. Friend the Secretary of State would explain in detail how those savings can be made without
  742
  irreparable damage to education. I ask him to consider in some detail the two specific points that I have mentioned: first, that it is no longer reasonable that ILEA should receive no rate support grant now that it has been rate-capped; and, secondly, the concept of delegating management of budget and finances to individual schools.
  11.7 pm
  Mr. John Cartwright: I make it clear at the outset that alliance Members will vote against the order, first, because we are still opposed to the concept of rate capping. In our view, rate capping is wrong in principle. There is no point in having a directly elected Inner London education authority if we are taking from the electors of inner London the right to decide crucial issues affecting our authority. Its spending crucially should be decided by the electors, not by Ministers and civil servants in the Department of Education and Science. That is one objection to the principle of rate capping.
  Secondly, we believe that rate capping is bureaucratic in operation and often wasteful in practice. If one has to apply damaging cuts at the last moment, the risk is that they are imposed not on the basis of any careful consideration of where the cuts can do least damage, but simply on the basis of where they can be made in a hurry. That can sometimes be crucial.
  I believe, and I am sure my colleagues agree, that it is impossible to impose the sort of cuts which are talked about in the order without damaging the basic fabric of education. We have already heard the views of the education officer, Mr. Stubbs, but it is worth recalling one sentence of his letter dated 21 January 1986 to the Department of Education and Science:
  "The consequence of expenditure reductions on such a scale could not avoid causing grave damage to the education service."
  If Conservative Members are not impressed by that, perhaps I should quote from a letter from Professor David Smith, the leader of the Conservative group on the Inner London education authority who resigned recently and who gave some of the reasons for his resignation in a letter to the right hon. Member for Chingford (Mr. Tebbit). I quote from that letter:
  "The recent decision by Central Government with respect to the precept limit for the Authority will result in cuts in the level of service; cuts that I believe will be disruptive to the education service".
  That is the view of the former Conservative leader in ILEA, and it should carry some weight with Conservative Members.
  Having said that ILEA has a powerful case, I am bound to say that it is undermined by the point which was made by the hon. Member for Lewisham, West (Mr. Maples). The shock horror stories about cuts would be much easier to accept this year if we had not heard absolutely the same stories last year. We heard them not only from ILEA, but from the Greater London council, and from inner London boroughs that were rate capped last year. We were told in banners across every public building that rate capping meant cuts. We were told that rate capping was the end of civilization as we knew it in inner London.
  What has happened? That spending has gone on as if there were no problem. There have been no cuts and no redundancies. Therefore, it is hardly surprising if the Government, on the one hand, and the electors in inner London, on the other, take the view that it is just another set of stories like the ones that they were told last year. I believe that there is much more basis to the shock horror

  743
  stories this year, but the ILEA cannot be surprised if, having cried wolf last year, it finds that the electorate do not respond to cries of wolf on this occasion.
  ILEA has not responded to the obvious threat of rate capping. There has been no attempt to plan for the inevitable. The leaders of ILEA do not live in an ivory tower. They knew what was going on, and that rate capping in the coming financial year would be more stringent and effective than in the previous year, yet they made no attempt to provide for that. In fact, spending has continued to rise, consuming nearly all the available reserves.
  Spending has gone beyond budgeted expenditure. In the summer of 1985, for example, an extra £300,000 was provided for more publicity. A week or so ago, an extra £100,000 was provided for additional press officers. That is an extremely strange sense of priorities. Here is an education authority telling us, with reason in my view, that the basic fabric of inner London's education is being impaired by the order, yet it is providing extra money to pay for publicity and press officers. That is not a powerful case to put to inner London electors.
  ILEA has a great deal of which to be proud, but there are areas of concern about its spending priorities and spending record. For example, since 1978–79, the cost of administration has increased by 16·5 per cent. in real terms at a time when the school rolls were going down by 12 per cent. That needs exploration. The cost of community education is up in real terms by 16 per cent. over that period when the number of student hours has fallen by 15 per cent.
  Mr. Jeremy Corbyn: The hon. Gentleman is making a strong attack on the existence of ILEA and its methods of spending money. Does he agree that it would be useful if every education authority was afforded the opportunity to use falling school rolls to improve the pupil-teacher ratio and provide the many education facilities that are wanted in schools but have been denied in the past?
  Mr. Cartwright: The hon. Gentleman could not have been listening carefully. I said that administration costs, not teaching costs, were up 16·5 per cent. while school rolls had gone down by 12 per cent. There may be a case for improving the teacher-pupil ratio at a time of falling school rolls, but I do not accept that the case for improving and extending administration is anything like so powerful.
  Another example is expenditure on education welfare services, which is up 5 per cent. in real terms while school rolls have fallen by 12 per cent., and there is no improvement in attendance figures.
  Mr. Andrew F. Bennett: Does the hon. Gentleman accept that a great deal of school welfare concerns the welfare of the individual child, not just attendance? Does he accept that unemployment and other problems in London have increased substantially in recent years, adding very much to the burden of education welfare officers?
  Mr. Cartwright: I do not dispute for a moment that a case can be made out for those things. I am simply saying that, on the basis of the figures, those issues should be explored. Here is an authority saying that it is not possible to make any economies, except in the basic fabric of education. I am giving instances of areas that could be examined.
  744
  Inner Londoners are willing to invest in inner London education, but in some cases they are concerned about the way in which money is being spent. That concern was confirmed in a couple of MORI opinion polls carried out by the Inner London education authority and paid for at the expense of inner London ratepayers. We have seen an extremely expensive campaign publicising some of the polls' findings, but only some of them. Some have been suppressed and some show concerns of inner London electors about the way in which some aspects of ILEA policy is pursued.
  The response of the ILEA leadership to the problem of rate capping is typical of Labour local authorities faced with rate capping elsewhere. They have taken a difficult problem and have been determined to make it as bad as possible. They have been intent on creating confrontation with the Government. They have pursued a policy denounced by the leader of the Labour party as playing politics with people's jobs and services. We reject that approach as vehemently as we reject the order.
  11.15 pm
  Mr. Frank Dobson: I speak as a parent. All three of my children go to Inner London education authority schools. I am the last person to be uncritical of some aspects of ILEA's performance and the performance of its schools, and I can criticise, because I experience what those schools are trying to do. However, I recognise the circumstances in which they are trying to do their job.
  I represent many people who send their children to ILEA schools. Most of them are satisfied with what the authority is doing and trying to do. In our traditional British way, we shall put that to the test in May. am certain that the new directly elected Inner London education authority will have an overwhelming majority of Labour Members when that election takes place.
  It is preposterous that a Government who introduce a directly elected authority, having tried 15 other types of attack on ILEA in preceding years, should suddenly decide that that elected authority has no mandate to spend the money that the people who put themselves to the bother of being elected believe needs to be spent on education in inner London.
  Where do the Government get any mandate to carry out what they propose to do to inner London's education? There has been no mention in any Tory election manifesto that they have ever put to the people of inner London of establishing that type of authority. There was no reference in any Tory manifesto put to anyone in the country that the Secretary of State would have powers to decide how much money could be spent on education in inner London.
  Even in the 1983 genera) election—a disaster for the Labour party—we still returned a majority of Labour Members for inner London — and, by God, it shows. Only one Tory inner London Member is present in the Chamber. At least, he had the decency to speak. If the Inner London education authority proposes school closures, the rest, in their hypocritical way, will shuffle in with the delegations, saying, "Do not damage the education of my constituents." But they will have busily voted for the limitation order tonight.
  In inner London, Labour have the majority of GLCILEA seats on the GLC, so there is no mandate for the Government there. Even in our bad times, Labour has controlled the inner London boroughs.

  745
  The Government have no mandate to limit the spending of ILEA. The authority is not even spending any of the Government's money. Under this skinflint, abominable Government, the authority, which has the most difficulties in this country, receives no grant.
  The Secretary of State, who is a freeman of the City of London, may ask about the poor business ratepayers who have been beaten to their knees by awful Labour authorities, but even the London chamber of commerce—the people who pay the rates; that is about the only tax they do pay, which is why they are so opposed to the rates—say that the precipitate reduction is too great and ought not to take place.
  The Tories in my constituency have chosen their candidates for the new authority. One is a woman called Olga Maitland, who, I believe, writes for a newspaper. She sends all three of her children to private schools, but is seeking to have the right to determine what happens to the schools of all the other people in my constituency. She will not touch those schools with a barge pole; that is typical of the hypocrisy of many Tory Members.
  Mr. Maples: Surely one of the responsibilities of the elected members of the new education authority will be to look after the interests of the ratepayers.
  Mr. Dobson: If the hon. Gentleman looks at the Act under which ILEA was established he will not discern any statutory responsibility for ratepayers being imposed on members of the authority. The ILEA members should look after the education of children, young people and adults in inner London; that is their duty. The ratepayers will be able to vote them in or vote them out in the usual way. It is unreasonable for the Secretary of State to set spending limits for ILEA. The authority, for good or ill, whether its decisions are right or wrong or properly judged or not, and whether every penny of the money is needed or not, should be taking the decisions and carrying the can with the electorate.
  We do not believe that the Secretary of State is fit to decide such matters. I do not believe that the right hon. Gentleman is personally fit to make those decisions. Like most people interested in education, in inner London, I was exhilerated to see on a recent billboard of The London Standard "Joseph to Quit". It seems that even the right hon. Gentleman has decided that he will not be up to representing the electors of Leeds at the next election. The people of inner London think that he is unfit to unrepresent and damage the education of their children now, and that he ought to go. It will be a disgrace if anyone who purports to represent the people, parents or children of inner London votes for the order. It will undoubtedly damage the interests of those children. The Secretary of State said—
  Mrs. Elaine Kellett-Bowman: Too long.
  Mr. Dobson: The hon. Member for Lancaster (Mrs. Kellett-Bowman) says that my speech is too long. With due deference to my hon. Friends, I shall take as long as I need to talk about the interests of the people I represent.
  The Secretary of State said that ILEA charges 35p per school meal. As a result of that, the proportion of schoolchildren in inner London eating school meals in this time of great impoverishment and great unemployment has
  746
  increased. And so it should. That is good and worthwhile spending. There is no more direct way of getting nourishment into a child than by giving it a meal. That is a better way of spending money than anything that Tory Members can think of.
  We have heard suggestions that ILEA is profligate. The hon. Member for Lewisham, West had the decency to accept that the Metropolitan police were possibly more exorbitant in their expenditure per unit than the ILEA. It is no good him shaking his head now. I understand that the Secretary of State for the Home Department is likely to agree to increase the expenditure of the Metropolitan police because of inner-city difficulties.
  The Secretary of State has taken unto himself direct powers over inner London. When London Members ask to see the Home Secretary about London matters, he agrees to see us. We want to ensure that when representatives and parents from inner London ask to see this Secretary of State about inner London matters, in which he will now directly interfere, we are not told to raise them in a debate. If he takes the powers, he must take the responsibility. We believe that he should leave the responsibiltiy where it properly rests — with those elected to provide an education service in inner London. They should be given the resources to do that. If what they do is not right, they will face the direct consequence by being thrown out of office by those who can choose to elect or not elect them. That is the way that it should be, and that is how it will be under the next Labour Government.
  11.27 pm
  Mr. Jeremy Corbyn: I agree with everything said by my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson). It is quite wrong that we should debate the expenditure of almost £1,000 million of public money in a one-and-a-half-hour debate late at night. It is the product of the centralisation of all decision-making around one or two Ministers. It is unsatisfactory that we should be expected to take decisions on matters affecting the children of inner London when few inner London Members are present—only one on the Government Benches—and when the Secretary of State is barely listening to the debate. I wonder whether he really understands the damage that he is about to do to the children of inner London.
  For seven years before I became a Member of this House, I was a full-time trade union official for the National Union of Public Employees within ILEA. For the past two years I was secretary of the manual workers' negotiation committee for all manual workers employed by the ILEA. It would be wrong not to say that, on occasions, there were severe differences between us and ILEA on some of its employment policies, or that we did not make strong demands. However, both we and ILEA were acutely conscious that education is about service to the community and about all those who work in a school, be they cleaners, school meals assistants, teachers, secretaries or whatever.
  I represent an ILEA constituency, and many of my constituents and others will suffer badly if the order is passed. It began from a long process of discussion within ILEA not about how to improve educational standards, which apparantly the Secretary of State wants, but from a process of fear about what might be cut in schools or what schools might be closed.

  747
  Rather than trying to face the problems of the children in inner London, teachers, administrators and others involved in education have instead had to suffer endless letters from the Secretary of State about how to make reductions in their educational expenditure.
  Only a few days ago, with much publicity, the Government announced their inner-city initiative — a paltry few million pounds to be spread over a large area. Indeed, the amount being offered to various parts of the country is less than required to build 50 houses. Yet tonight, with no publicity, the Government propose to make enormous cuts in the education budget of inner London.
  I have to ask the House to consider areas such as my hon. Friend the Member for Holborn and St. Pancras represents, the levels of unemployment there and the fate of many school leavers. In 1980, one year after the Government came to office, there were eight youngsters for each job available for school leavers. Three years later there were 20. That is the measure of how bad unemployment has got in inner-city areas.
  ILEA cannot be expected to control the economy of inner London or to solve all of the problems that are heaped on it by the Government's economic policies, but it has at least tried to equip those youngsters for the type of life that they will lead when they leave school. It has tried to develop community education. It has developed a first-class further and higher education service and it tops the league table in any sense in the provision of further education for those who missed out on any opportunity when they left school. ILEA's principle has been to provide higher and further education for those who wish to follow it, irrespective of their ability to pay and irrespective of their academic achievements on leaving school.
  Mr. Maples: And irrespective of the cost.
  Mr. Corbyn: The hon. Member might shout nonsense, but, like my hon. Friend the Member for Holborn and St. Pancras, I am sure that he would be the first to lead a deputation if he heard that the City Lit was closing down.
  Mr. Maples: I am grateful to the hon. Gentleman for giving way. I did not say nonsense, but "Irrespective of the cost". That is one of the things that the hon. Gentleman was not thinking about.
  Mr. Corbyn: I am thinking very much about the cost of those institutions. I am aware that they are expensive and that they are non-statutory, but I am also aware that they are extremely valuable. It is not possible to run an education system based on an accountant's calculator. It must be based on the effectiveness of equipping children for later life and of further and higher education services.
  The cost that the Secretary of State believes is the correct figure for London's education next year takes no account of many factors, and he knows it. It takes no account, for example, of inflation, which he presumably thinks does not happen. It also takes no serious account of the cost of abolition of the greater London council and the cost therefore forced on ILEA. It also has many hidden features, such as the right hon. Gentleman's obsession with ILEA leaving county hall. Has the right hon. Gentleman examined any of these matters? Has he examined the real costs, and the effects on every school and every child throughout London of the proposed precept?
  748
  The Secretary of State said that he would give some answers later. Here is a question for him, to which I should like a clear answer. He said that ILEA has not raised the price of school meals from 35p, a price that was set some years ago. I wish that it had been set at 25p before the last election. Nevertheless, I am glad that the price has not increased from 35p, as it means that many children are able to get a decent meal, which they would otherwise not get. Half of the children in inner London are eligible for free school meals, which demonstrates, and is an indictment of, the level of poverty.
  My question is simple. If the price of school meals is raised to the level found in some outer-London boroughs—60p and 70p—how many children will go without a school meal because their parents cannot afford it? Bearing in mind the system by which school meals workers are employed—it is based on the number of meals served and an allocation of hours to each kitchen—how many school meals workers would lose their jobs? What would be the cost to the public purse through unemployment benefit, social security payments and the misery associated with making those meals workers unemployed? Does the right hon. Gentleman realise that many of them are part-time women workers for whom no other job is available?
  In short, the right hon. Gentleman is telling the people of inner London and ILEA that they should starve the children, sack the cooks and sack the school meals assistants because of his obsession with the pricing mechanism of the school meals service. Or, does he want ILEA to privatise its school meals service and throw more people out of work, so that even fewer children get a free school meal? That seems to be the direction in which he is moving. Will he consider the effects of his suggestions?
  Mr. Donald Thompson: It is like all our yesterdays.
  Mr. Corbyn: I look back on the period before 1979, not as the greatest achievement that I would have wished for, but when children were at least sure of getting a school meal, teachers were sure of their jobs, and a great threat did not hang over our education service.
  The Government and Tory Members do not care about inner London or the future of ILEA. But they have been forced by public action and pressure to have an elected education authority, which they did not want, just as earlier public action and pressure prevented them from abolishing ILEA altogether and handing it over to individual borough councils. In May they will face an election, which they will certainly lose, and the education authority will be Labour controlled and, will certainly, be ratecapped until the Government are finally driven from office.
  The Government must face the fact that they have no supporters for their proposals for inner London, and that ILEA, for all its difficulties and size, is a popular institution. Many people find it essentially sympathetic to the children and problems of inner London. But the Government, instead of recognising the special difficulties of inner London, such as its poor housing, high level of unemployment, and the fact that one in six children at ILEA schools speak English as a second language, not the first, are not prepared to recognise the effects of their policies on inner London. By the systematic removal of Government expenditure on inner London, the Government have ended treating the poorest part with the

  749
  greatest problems, with the greatest disrespect and giving it no financial help in most years. That is an indictment of their treatment of inner London.
  Tonight we shall vote against the precept. I hope that the debate will be heard elsewhere, and that in the Fulham by-election people will understand what the Government's attitude to education means. They do not care. ILEA has attempted to provide the best for the poorest children. That is one reason why the Tories will lose the by-election, the council elections and, above all, in London the general election, when it comes.
  11.37 pm
  Mr. Simon Hughes: I wish to add some brief, specific points to those raised by my hon. Friend the Member for Woolwich (Mr. Cartwright).
  The Secretary of State did not deal with interventions during his speech, and I wish to point to the fundamental inconsistency in his argument. He argued that there is scope for enormous cuts, and that it is appropriate to cut the ILEA budget by 6 per cent. However, his Cabinet colleagues are falling over themselves pretending that they need to spend more on inner cities and to give urban grants. Only last week the Paymaster General was providing more sweeteners for inner cities and pretending to provide more money, albeit only little more, because he recognises the needs. It is impossible for the Government to argue that the ILEA has no more needs, to accept that the inner cities, especially inner London, have enormous needs, and to dispute the views of inspectors that ILEA does a good job and of their colleagues, not least the leader of the Conservative group on ILEA, that the Government are misguided in their approach to inner London education. Inner London is clearly a deprived area in social terms. There are problems that stem from lack of opportunity, employment and educational attainment. There are fundamental social problems accompanied by drugs and other evils. Only investment in the education service can substantially alter that deprivation for life.
  I shall show by example how misguided it is to cut inner London expenditure. First, I ask the House to consider the non-statutory sector in the youth service. I declare an interest, because before I was elected to this place I was a member of the Southwark area youth committee, and I remain a member. If we are to try to deal with the inadequate employment opportunities of young people and the time that they can put to misuse which they can put to good use with guidance, we must develop, not restrict, the youth service. If we are to give young women the opportunities that young men have often enjoyed and create opportunities for career guidance and training for the development of social relations, we must spend money on the youth service, not contract it. If it is said that all that can be afforded is statutory provision, there will be no money available for expanding the youth service in inner London, with the result that increasing numbers of inner London's young people will have little to do and little prospect of employment when they leave school.
  Secondly, I shall give an even more harrowing and, I hope, pointed example to the Secretary of State. The special schools in London are still grossly underfunded. Recently I visited one of the special schools in Southwark—Cherry Garden school. It does not have sufficient
  750
  supply and permanent teachers. It does not have the ability to take its severely handicapped pupils from the ground floor to the first floor because it does not have the money to install a lift. The staff are trying desperately to allow those with handicaps and disabilities to develop their potential so that they can lead a full life. The best chance that the staff have of doing that is with children between the ages of two, when they start at the school, and 18. If they are held back, if the opportunities to correct the imbalance that heredity, illness, nature or circumstances have brought about are not taken by investment through public funding, we are doubly handicapping those who most need the benefits of our investment.
  The reality is that education in inner London is still not meeting many of the needs that Britain requires it to meet. I accept that there can be savings, but there is no scope for massively cutting investment. The needs are enormous. I hope that the Secretary of State will realise that a time of enormous cuts generally, the additional burden of cutting back severely on the ILEA budget will lead to a recipe for inner London that offers a far less satisfactory future for our young people than we ask for them, that they deserve and that otherwise they would be able to obtain.
  11.44 pm
  Mr. Alfred Dubs: Like my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), I declare an interest. Both my children went to ILEA schools, my wife is currently an ILEA teacher, and I am the governor of a school in my constituency. Over the past 15 or so years I have been a governor of about five other ILEA schools. I can claim some first-hand knowledge and some direct experience of the issues that we are discussing.
  I am horrified by the way in which the Government think that, on a purely arbitrary basis, they have the right to determine the nature of education and spending on education in inner London. They have made out no case for their approach, which is based upon no direct knowledge of what is going on in the schools. They merely take the view that they must punish the ILEA. The reluctance of the Government to have any faith in the people of London and their elected representatives is astonishing. Why cannot the Government say, "Let the people of London decide; let us leave it to Londoners to decide how much they are willing to spend on the education of London's children"?
  The truth is that since the Government's election they have decided that the ILEA is to be got at. The Government have decided to attack and undermine by various means education in inner London. This is only the first of many chapters in the saga. Having listened to the Secretary of State and his predecessors, and to the Tory party as a whole, I have come to the conclusion that they have no interest in the education or the children of inner London.
  The Secretary of State compared London with Birmingham and other inner cities. ILEA is unique because it represents only an inner city area and because it has no leafy suburbs or middle class areas, with the exception of Chelsea, south Westminster and parts of Kensington. Therefore, London has a larger proportion of children from disadvantaged homes than any other education authority. For that reason if for no other, London should be treated as an authority that needs more help and support than any other education authority.

  751
  The one thing that Britain has going for it other than coal and diminishing oil is the skill, education and training of its people. That is the only thing that will, in the next century, separate Britain from underdeveloped countries. If we do not continually invest in those assets, we shall be throwing away our future, and we shall be as nothing. That is why I look with horror on any Government who say that education can be cut because it does not matter. We reject that view utterly and entirely.
  11.46 pm
  Sir Keith Joseph: With the leave of the House, Mr. Deputy Speaker, in the time available, I must do my best to answer all the questions that have been put, but I must correct one impression at once. The picture has been given that in the ILEA area unemployment has been higher and earnings lower than in any other inner city area. That is untrue. I hope that the House will remember that employment and average earnings in London are higher than they are in any other inner city area. That is so on an inner city to inner city basis.
  Mr. Tony Banks rose—
  Mr. Dobson rose—
  Sir Keith Joseph: I cannot give way, as I have a large number of questions to answer.
  I agree with my hon. Friend the Member for Lewisham, West (Mr. Maples) and the hon. Member for Woolwich (Mr. Cartwright), who drew attention to the degree to which ILEA last year spoilt its case by prophesying gloom and doom, and crying wolf. It must expect some scepticism about its forecast this year in the light of what transpired last year. My hon. Friend and the hon. Member for Holborn and St. Pancras (Mr. Dobson) asked why ILEA does not receive grant. I remind them of the unique rateable value of ILEA. That is why it does not get grants.
  The hon. Member for Islington, North (Mr. Corbyn) made a significant speech about school meals. It is possible for ILEA to raise school meal charges to a level somewhat nearer the national average—from 35p, the level at which it has been since 1980, to the national average of 60p. One of the economies canvassed by ILEA officials was an increase to 50p. Whereas there might be job losses in connection with a rise in school meal charges, it does not follow that an increase in school meal charges leads necessarily to a decline in the take-up of school meals. Many other authorities have so designed their school meals service as to increase the take-up of school meals even though the prices have risen.
  Mr. Dobson rose—
  Sir Keith Joseph: I am not giving way, as I have to cover many points in a limited time.
  Moreover, although the hon. Member for Islington, North lays much emphasis upon the loss of jobs in the schools meals service—a loss of jobs which I do not accept as being necessary—ILEA's ILEA's policy, involving increased rates for ratepayers, including businesses, involves an equal number of job losses, which the Opposition completely fail to take into account.
  Mr. Corbyn: Will the right hon. Gentleman give way?
  Sir Keith Joseph: No.
  752
  It is well known that job losses result from increased rates. [HON. MEMBERS: "No, it is not."] Many businesses have been driven out of high rate authority areas, with the consequent loss of a great number of jobs.
  The hon. Member for Durham, North (Mr. Radice) asked me a number of questions that I shall seek to answer. He referred to the HMI comment in its annual report that ILEA provides adequate cover against a number of criteria. Nobody doubts that. The HMI report does not say, however, that ILEA provides that adequate cover at an economic cost. Nor must the hon. Gentleman or the House confuse the provision of service with the quality or standards of that service. Above a certain minimum sufficiency for education it is not possible to measure the standard, quality or effectiveness of education by the mere counting of spending. Spending is extremely important, but it is not the same as quality or effectiveness. The point about ILEA is that, despite record spending, it does not succeed in raising the standard, effectiveness or quality of the education of its pupils above that of much lower spending authorities that face equal problems. The Government readily accept the difficulties that ILEA, to an even greater extent than other inner city authorities, faces in education, but the difference between spending and effectiveness has to be borne in mind.
  The hon. Member for Durham, North asked the Government to remember that ILEA has proposed savings of £18 million. Yes, it has, but what does it intend to do with those savings? It does not intend to return them to t he ratepayer. It intends to redeploy them upon other facets of education.
  Much emphasis was laid upon the damage that ILEA's education officials assert will be caused if the draft order is approved, because only one in three vacancies in ILEA will be filled during the year in question. That damage will occur only if there is no vigorous management to carry out a redeployment of staff. As I said in my opening speech, ILEA retains 450 teachers who are supernumerary to its establishment. It could therefore replace one in three vacancies without any damage being done to the quality of education if it carried out at the same time a vigorous redeployment policy. Vigorous management will be necessary.
  I was asked to give examples of other education authorities that have carried out cuts of 6 per cent. in one year. Manchester has carried out a cut of 9 per cent. I have a list of authorities that have made cuts in real terms of 5 per cent. or more. They have made those cuts from a spending base that is far lower than ILEA's. [HON. MEMBERS: "Name them."] Barnet has done so twice; Harrow; Kingston upon Thames; Merton twice; Richmond upon Thames; Sefton; Manchester; Trafford twice; Doncaster; Gateshead; Newcastle upon Tyne; South Tyneside; East Sussex; Gloucestershire; Kent and Somerset.
  Special schools in ILEA are not underfunded. They spend well above the national average with due attention to the handicap of each child.
  The hon. Member for Durham, North asked whether the Government are seeking to impose an illegal budget on ILEA. Certainly not. I was asked by the hon. Gentleman whether the Government are seeking to require ILEA to ignore its statutory duties. Certainly not. ILEA has statutory duties and it would be open to a default inquiry if it failed to carry out its statutory duties.

  753
  I am sure that the officers of ILEA, to whom praise has rightly been given by the hon. Gentlman, are able to carry through the necessary savings once the House approves an order on the lines of the draft order being put to the House this evening. I regard them as certainly able to carry out the savings required without damage to the education of the children of ILEA.
  No Government have ever shown more concern for the quality, standards and effectiveness of education in Britain than this Government.
  Mr. Radice: Will the right hon. Gentleman give way?
  Sir Keith Joseph: No.
  ILEA cannot expect that the public should measure its standards, quality and effectiveness merely by its spending. It can maintain, and I hope improve, the quality of the education of the children of inner London by more vigorous management even at lower cost. I ask the House to approve the order.
  Mr. Radice: Why did not the Secretary of State agree to a compromise with ILEA this afternoon, as he was perfectly able to do? If he had agreed to a compromise, ILEA would be accepting savings and there would have been a better precept. That would have been the sensible course for the Secretary of State to take. He has not taken it, and is is stupid not to have done so.
  Sir Keith Joseph: Because I believe that ILEA can maintain and even improve the standards of education to its children at a lower cost to the ratepayers. Indeed, if the hon. Gentleman challenges me, I say that I have raised the expenditure level and the maximum precept by a significant amount.
  Question put:—
  The House divided: Ayes 209, Noes 160.

  Division No. 66]

  [11.57 pm

  AYES

  Ancram, Michael

  Glyn, Dr Alan

  Beaumont-Dark, Anthony

  Goodlad, Alastair

  Biggs-Davison, Sir John

  Gow, Ian

  Boscawen, Hon Robert

  Grant, Sir Anthony

  Bottomley, Mrs Virginia

  Gregory, Conal

  Buck, Sir Antony

  Griffiths, Peter (Portsm'th N)

  Burt, Alistair

  Ground, Patrick

  Butterfill, John

  Grylls, Michael

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

  Hamilton, Hon A. (Epsom)

  Cash, William

  Hamilton, Neil (Tatton)

  Clark, Dr Michael (Rochford)

  Hampson, Dr Keith

  Cope, John

  Hannam, John

  Corrie, John

  Hargreaves, Kenneth

  Currie, Mrs Edwina

  Harris, David

  Dorrell, Stephen

  Harvey, Robert

  Douglas-Hamilton, Lord J.

  Haselhurst, Alan

  Durant, Tony

  Hawkins, Sir Paul (N'folk SW)

  Emery, Sir Peter

  Hawksley, Warren

  Fairbairn, Nicholas

  Hayes, J.

  Favell, Anthony

  Heathcoat-Amory, David

  Fenner, Mrs Peggy

  Henderson, Barry

  Forman, Nigel

  Heseltine, Rt Hon Michael

  Forsyth, Michael (Stirling)

  Hickmet, Richard

  Forth, Eric

  Higgins, Rt Hon Terence L.

  Franks, Cecil

  Hind, Kenneth

  Fraser, Peter (Angus East)

  Hogg, Hon Douglas (Gr'th'm)

  Freeman, Roger

  Holt, Richard

  Fry, Peter

  Hordern, Sir Peter

  Gale, Roger

  Howard, Michael

  Galley, Roy

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

  Gardiner, George (Reigate)

  Howarth, Gerald (Cannock)

  Gardner, Sir Edward (Fylde)

  Howell, Ralph (Norfolk, N)

  Garel-Jones, Tristan

  Hubbard-Miles, Peter

  754

  Hunt, David (Wirral W)

  Roberts, Wyn (Conwy)

  Hurd, Rt Hon Douglas

  Robinson, P. (Belfast E)

  Johnson Smith, Sir Geoffrey

  Roe, Mrs Marion

  Jones, Gwilym (Cardiff N)

  Rossi, Sir Hugh

  Jones, Robert (Herts W)

  Rowe, Andrew

  Joseph, Rt Hon Sir Keith

  Rumbold, Mrs Angela

  Kellett-Bowman, Mrs Elaine

  Ryder, Richard

  Kershaw, Sir Anthony

  Sackville, Hon Thomas

  King, Roger (B'ham N'field)

  Sainsbury, Hon Timothy

  Knight, Greg (Derby N)

  Sayeed, Jonathan

  Knight, Dame Jill (Edgbaston)

  Shaw, Giles (Pudsey)

  Knowles, Michael

  Shaw, Sir Michael (Scarb')

  Knox, David

  Shelton, William (Streatham)

  Lamont, Norman

  Shepherd, Richard (Aldridge)

  Lang, Ian

  Silvester, Fred

  Lawler, Geoffrey

  Sims, Roger

  Lawrence, Ivan

  Smith, Tim (Beaconsfield)

  Leigh, Edward (Gainsbor'gh)

  Soames, Hon Nicholas

  Lennox-Boyd, Hon Mark

  Speed, Keith

  Lightbown, David

  Spencer, Derek

  Lilley, Peter

  Spicer, Jim Dorset W)

  Lloyd, Ian (Havant)

  Squire, Robin

  Luce, Rt Hon Richard

  Stanbrook, Ivor

  Lyell, Nicholas

  Stanley, Rt Hon John

  McCurley, Mrs Anna

  Steen, Anthony

  MacKay, Andrew (Berkshire)

  Stern, Michael

  MacKay, John (Argyll & Bute)

  Stevens, Lewis (Nuneaton)

  Maclean, David John

  Stewart, Allan (Eastwood)

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

  Stewart, Andrew (Sherwood)

  Madel, David

  Stewart, Ian (Hertf'dshire N)

  Major, John

  Stokes, John

  Malins, Humfrey

  Stradling Thomas, Sir John

  Malone, Gerald

  Sumberg, David

  Maples, John

  Taylor, John (Solihull)

  Marlow, Antony

  Taylor, Teddy (S'end E)

  Mates, Michael

  Temple-Morris, Peter

  Mather, Carol

  Terlezki, Stefan

  Maxwell-Hyslop, Robin

  Thomas, Rt Hon Peter

  Mayhew, Sir Patrick

  Thompson, Donald (Calder V)

  Merchant, Piers

  Thompson, Patrick (N'ich N)

  Miller, Hal (B'grove)

  Thorne, Neil (Ilford S)

  Mills, Iain (Meriden)

  Thornton, Malcolm

  Miscampbell, Norman

  Townend, John (Bridlington)

  Mitchell, David (Hants NW)

  Townsend, Cyril D. (B'heath)

  Moate, Roger

  Trippier, David

  Montgomery, Sir Fergus

  Twinn, Dr Ian

  Moore, Rt Hon John

  van Straubenzee, Sir W.

  Mudd, David

  Vaughan, Sir Gerard

  Murphy, Christopher

  Waddington, David

  Neale, Gerrard

  Wakeham, Rt Hon John

  Nelson, Anthony

  Waldegrave, Hon William

  Neubert, Michael

  Walden, George

  Nicholls, Patrick

  Walker, Bill (T'side N)

  Norris, Steven

  Waller, Gary

  Oppenheim, Rt Hon Mrs S.

  Ward, John

  Osborn, Sir John

  Wardle, C. (Bexhill)

  Ottaway, Richard

  Watson, John

  Page, Sir John (Harrow W)

  Wells, Bowen (Hertford)

  Parris, Matthew

  Whitfield, John

  Patten, Christopher (Bath)

  Whitney, Raymond

  Pawsey, James

  Wiggin, Jerry

  Percival, Rt Hon Sir Ian

  Wilkinson, John

  Pollock, Alexander

  Winterton, Mrs Ann

  Porter, Barry

  Winterton, Nicholas

  Portillo, Michael

  Wolfson, Mark

  Powell, William (Corby)

  Wood, Timothy

  Raffan, Keith

  Woodcock, Michael

  Raison, Rt Hon Timothy

  Yeo, Tim

  Rathbone, Tim

  Young, Sir George (Acton)

  Renton, Tim

  Rhodes James, Robert

  Tellers for the Ayes

  Rhys Williams, Sir Brandon

  Mr. Peter Lloyd and

  Ridley, Rt Hon Nicholas

  Mr. Francis Maude.

  Ridsdale, Sir Julian

  NOES

  Adams, Allen (Paisley N)

  Banks, Tony (Newham NW)

  Ashley, Rt Hon Jack

  Barron, Kevin

  Atkinson, N. (Tottenham)

  Beckett, Mrs Margaret

  Bagier, Gordon A. T.

  Bell, Stuart

  755

  Benn, Rt Hon Tony

  Ewing, Harry

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

  Fatchett, Derek

  Bermingham, Gerald

  Faulds, Andrew

  Bidwell, Sydney

  Fields, T. (L'pool Broad Gn)

  Blair, Anthony

  Fisher, Mark

  Boothroyd, Miss Betty

  Flannery, Martin

  Boyes, Roland

  Forrester, John

  Bray, Dr Jeremy

  Foster, Derek

  Brown, Hugh D. (Provan)

  Foulkes, George

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

  Fraser, J. (Norwood)

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

  Freeson, Rt Hon Reginald

  Brown, Ron (E'burgh, Leith)

  Garrett, W. E.

  Caborn, Richard

  Gilbert, Rt Hon Dr John

  Callaghan, Jim (Heyw'd & M)

  Golding, John

  Campbell-Savours, Dale

  Hamilton, James (M'well N)

  Carter-Jones, Lewis

  Hamilton, W. W. (Fife Central)

  Cartwright, John

  Hardy, Peter

  Clark, Dr David (S Shields)

  Harrison, Rt Hon Walter

  Clarke, Thomas

  Healey, Rt Hon Denis

  Clelland, David Gordon

  Heffer, Eric S.

  Clwyd, Mrs Ann

  Hogg, N. (C'nauld & Kilsyth)

  Cocks, Rt Hon M. (Bristol S)

  Holland, Stuart (Vauxhall)

  Cohen, Harry

  Home Robertson, John

  Coleman, Donald

  Howells, Geraint

  Conlan, Bernard

  Hoyle, Douglas

  Cook, Frank (Stockton North)

  Hughes, Dr Mark (Durham)

  Corbett, Robin

  Hughes, Robert (Aberdeen N)

  Corbyn, Jeremy

  Hughes, Roy (Newport East)

  Craigen, J. M.

  Hughes, Sean (Knowsley S)

  Crowther, Stan

  Hughes, Simon (Southwark)

  Cunliffe, Lawrence

  John Brynmor

  Cunningham, Dr John

  Jones, Barry (Alyn & Deeside)

  Davies, Ronald (Caerphilly)

  Kaufman, Rt Hon Gerald

  Deakins, Eric

  Kilroy-Silk, Robert

  Dewar, Donald

  Kinnock, Rt Hon Neil

  Dobson, Frank

  Lamond, James

  Dormand, Jack

  Leadbitter, Ted

  Douglas, Dick

  Lewis, Ron (Carlisle)

  Dubs, Alfred

  Lewis, Terence (Worsley)

  Duffy, A. E. P.

  Litherland, Robert

  Dunwoody, Hon Mrs G.

  Livsey, Richard

  Eadie, Alex

  Lloyd, Tony (Stretford)

  Evans, John (St. Helens N)

  Lofthouse, Geoffrey

  756

  Loyden, Edward

  Robertson, George

  McCartney, Hugh

  Robinson, G. (Coventry NW)

  McDonald, Dr Oonagh

  Rogers, Allan

  McKay, Allen (Penistone)

  Rooker, J. W.

  McKelvey, William

  Rowlands, Ted

  McNamara, Kevin

  Sedgemore, Brian

  McTaggart, Robert

  Sheerman, Barry

  McWilliam, John

  Sheldon, Rt Hon R.

  Madden, Max

  Shore, Rt Hon Peter

  Marek, Dr John

  Short, Ms Clare (Ladywood)

  Maxton, John

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

  Maynard, Miss Joan

  Silkin, Rt Hon J.

  Meacher, Michael

  Skinner, Dennis

  Michie, William

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

  Millan, Rt Hon Bruce

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

  Mitchell, Austin (G't Grimsby)

  Snape, Peter

  Morris, Rt Hon A. (W'shawe)

  Soley, Clive

  Morris, Rt Hon J. (Aberavon)

  Spearing, Nigel

  Nellist, David

  Stott, Roger

  Oakes, Rt Hon Gordon

  Strang, Gavin

  O'Brien, William

  Thompson, J. (Wansbeck)

  O'Neill, Martin

  Thorne, Stan (Preston)

  Park, George

  Tinn, James

  Parry, Robert

  Torney, Tom

  Pavitt, Laurie

  Wallace, James

  Pendry, Tom

  Wardell, Gareth (Gower)

  Pike, Peter

  Weetch, Ken

  Powell, Raymond (Ogmore)

  Welsh, Michael

  Prescott, John

  Williams, Rt Hon A.

  Radice, Giles

  Winnick, David

  Randall, Stuart

  Young, David (Bolton SE)

  Redmond, Martin

  Rees, Rt Hon M. (Leeds S)

  Tellers for the Noes:

  Richardson, Ms Jo

  Mr. Frank Haynes and

  Roberts, Ernest (Hackney N)

  Mr. Don Dixon

  Question accordingly agreed to.
  Resolved,
  That the draft Precept Limitation (Prescribed Maximum) (Inner London Education Authority) Order 1986, which was laid before this House on 29th January, be approved.

  Orpington Hospital
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Boscawen]
  12.8 am
  Mr. Ivor Stanbrook: I am grateful for the opportunity to bring to the attention of the House the problem of the future of Orpington hospital. There is considerable anxiety in my constituency about the development of the hospital, and I hope that my hon. Friend the Minister will be able to provide reassurance on a number of points. I am grateful to my hon. Friend for being here.
  The stages in the progress of Orpington hospital from its origin as a hutted encampment to its destiny as a full-blown district general hospital has been reported by me to the House in Adjournment debates from time to time and almost annually over the past five years. The history is one of erratic and slow progress marked by setbacks and changes of policy which have at times undermined the viability of the hospital as the intended district general hospital for the southern half of the Bromley health district.
  The Government have proclaimed their attachment to the National Health Service, and one understands that the amount of public money being spent on the nation's health nowadays is in real terms greater than ever before. Unfortunately, that is not always the impression given locally when hospitals are closed or reduced in size or services on the ground of financial economies. I hope that my hon. Friend will be able to show my constituents that the problems arising for Orpington hospital are not in any sense due to an overall reduction in funding.
  The origin of Orpington hospital was a military hospital built with temporary materials by the Canadian Government during the first world war. When the Canadians left, the 30-acre site filled with single-storey wooden buildings and Nissen huts was taken over to serve local needs. Comparatively little was spent on the buildings themselves for many years, but the hospital, because of the quality of the staff and the support of the local people, attained a high reputation.
  In the 1970s capital funds were allocated for the rebuilding of the hospital and the replacement of the huts by fine modern buildings. The most recent development is the construction of a modern surgery block — the Ontario wing—which cost over £8 million and is part of an overall strategy intended to provide a district general hospital on the site. The strategy of the Bromley district health authority is to have two district general hospitals, located at Bromley town in the north and Orpington in the south, to be completed by 1993–94 and to centralise all acute, general and surgical services on them with 600 and 470 clinical beds, respectively. That is a satisfactory arrangement for Orpington.
  The site is well placed to serve the fastest growing part of the health district. At present it serves a population and patients spreading far south into Kent and the constituencies of my hon. Friends the Members for Chislehurst (Mr. Sims) and for Sevenoaks (Mr. Wolfson) and my hon. and learned Friend the Member for Tunbridge Wells (Sir P. Mayhew). It is the nearest hospital in southeast London to the M25 motorway which, in the future, may be the source of casualties needing urgent treatment. The hospital stands on a healthy green field site of 30 or
  758
  more acres, so there is plenty of room for expansion, unlike the site of Farnborough hospital nearby, which is in 19th century buildings and is very congested.
  Faced by a need to make ends meet two years ago, the district health authority adopted a number of economies, one of which was the overnight closure of the accident and emergency services at Orpington hospital. An average of ten patients per night were turned away from the hospital—for an estimated saving of £70,000 per annum. Emergency cases locally, including those arising in Kent, out of office hours, must now be taken elsewhere, six miles further on, to Bromley or Sidcup. As a result, the hospital lost its status as a major accident centre. When the horrendous pile-up in fog on the M25 occurred two years ago, with many casualties, they had to be taken virtually past the hospital gates into Bromley. The overnight closure of the casualty service at Orpington was provisional. It has not yet been confirmed by the Minister, and I hope that it will not be.
  A full-time accident and emergency service is a prerequisite for a full-blown district general hospital. The absence of such a service is bound to have a depressing effect on staff and on the recruitment of highly qualified people.
  More recently, however, we have had an astonishing proposal from the district authority. In an attempt to get its sums right, it saw fit to recommend the downgrading of Orpington hospital in favour of the hospital at Farnborough, which it recommended should be designated as the site of the proposed district general hospital. The suggestion seems to have come originally from the professionals at Farnborough, who calculated that the total outlay of public funds could thereby be reduced. There was, however, a violent storm of protest in Orpington. Petitions were organised and public meetings held. One that I attended, in the biggest available hall, was so large that hundreds of people were turned away. The strength of local feeling in support of Orpington hospital was amply demonstrated. Fortunately, the district health authority gave way and, with some help, or perhaps pressure, from the regional authority, reinstituted Orpington as the site of the district general hospital.
  After that, the planners went back to their calculators. They produced a new plan, accepting the emergence of Orpington ultimately as one of the two district general hospitals by 1993–94; but, pending the capital investment needed to implement the strategic aim of having two district general hospitals at Bromley and Orpington, they proposed to save revenue by running down Orpington's general medical services and transferring them to Farnborough.
  That plan is inconsistent with the ultimate objective of district general hospital status for Orpington, and it has not found favour with the regional authority, which has promised more co-operation in solving Bromley's temporary financial problems. There are a number of steps that the regional authority could take to help Bromley district health authority, besides making capital development funds available. If, for example, it would be easier and less costly to run services when they are concentrated on the two sites, any repayments of loans and any impositions of the regional RAWP formula should be adjusted to the latter part of the period of redevelopment rather than spread equally over the whole period.
  I conclude by asking my hon. Friend the Parliamentary Under-Secretary three questions. First, will he confirm

  759
  that Orpington hospital will be developed as a district general hospital once and for all? Secondly, will he tell us what will happen to Farnborough hospital? Thirdly, will he confirm that whatever changes are made elsewhere, Orpington's general medical and surgical services will not be run down meanwhile? If I can have his assurances on those points, I am sure that my constituents will rest content and endure stoically the minor changes and economies that may be forced upon the authority by the redevelopment. Changes and economies there always have to be, but please do not let us have any that will put the future of Orpington hospital into doubt once again.
  12.20 am
  The Parliamentary under-Secretary of State for Health and Social Security (Mr. Ray Whitney): I hope that in responding to my hon. Friend the Member for Orpington (Mr. Stanbrook) I shall be able to offer assurances to enable him and, more importantly, his constituents to rest content. I am glad to have the opportunity to spell out the future position of Orpington hospital as we understand it in the Department. I congratulate my hon. Friend on the constant attention that he pays to the health provision, as with all other provisions, of his constituents about whom he is intimately and passionately concerned.
  My hon. Friend mentioned the national expenditure on the National Health Service, and quite rightly, because it is important. In all the concerns about the changing and improving pattern of the delivery of the NHS, it is forgotten all to often that, in real terms, increasing amounts of taxpayers' money is devoted to the Health Service. We are proud of the fact that, since we came to office in 1979, there has been an increase of more than 20 per cent. In 1986–87, spending will increase by £650 million and not by £670 million, which I quoted incorrectly in a debate on 5 February. The increase of £650 million represents an increase of 6·7 per cent., which is about 2·2 per cent. more than the forecast rate of inflation. Further increases are planned in the following two years and also further increases in capital spending. As my hon. Friend rightly said, in total, national spending on the Health Service is increasing in real terms. The question is how that affects our constituencies and its impact on our constituents.
  My hon. Friend referred to the now famous RAWP—the resource allocation working party. The policy of redistributing resources between different parts of the country will continue. Those regions which have historically received less than their fair share of resources or which have rapidly increasing populations will receive the larger increases, ranging up to 8 per cent. The decisions on the 1986–87 allocation reaffirm our commitment. As regions move closer to their targets, it becomes increasingly important that the targets are themselves a reasonably accurate measure of need. We have therefore asked the NHS management board to review the operation of the formula, in particular the way in which relative needs in different parts of the country are measured, taking account of such factors as the patterns of illness across the country, and the special problems of the inner cities. I mention that, because it is important to understand that the RAWP allocation is carried out in a sensitive manner while trying to take the best possible account, within a steadily increasing global total, of the special demands and requirements of each district.
  760
  South-east Thames, in which my hon. Friend's constituency falls, is a RAWP loser—as the jargon calls it. It was 13 per cent. above target when RAWP was introduced in 1977–78 and in 1985–86 it is 5·6 per cent. above target. However, its position is better than originally assumed following the December statement made by my right hon. Friend the Secretary of State for Social Services. It will be receiving an increase of 5·8 per cent. compared with forecast inflation of 4·5 per cent.
  One priority task that the region has set for the strategic period up to 1994 is the correction of the gross imbalance of funding within its districts. Sadly, that is not good news for Bromley, which is a RAWP loser. Its current revenue funding is 105·7 per cent. of its RAWP target and it is planned to reduce that to 100 per cent. by 1993–94. Therefore, there is no doubt that the district is facing financial problems, and a fundamental cause of that is the high number of acute beds in the district, scattered over as many as four sites. That inevitably leads to an inefficient use of resources and a needless drain on revenue that is in heavy demand in other parts of the NHS.
  My hon. Friend has mentioned the scatter of beds in the health authority area. The Farnborough hospital is about two miles from Orpington and there is some duplication of services in general medicine and surgery. Not surprisingly, patient throughput, or the efficient use of beds is very low, with a death and discharge rate of 36·7. That is also the national figure on that NHS performance indicator. The corresponding figure for Bromley is 31·2. Nearby, Maidstone shows what can be achieved by the efficient use of services. It has a figure of 41·7.
  The health authority was required to look for remedies, both short term and long term. Those remedies have come into conflict in Orpington and led to the turbulence that my hon. Friend described.
  Detailed options are still being discussed, but there is agreement between the region and the district that Farnborough hospital should close within the strategic period, or not too long thereafter, and that beds should be concentrated at Bromley and Beckenham in the north of the district and at Orpington in the south. The overall number of acute beds in the district would reduce from the present 659 to 566, bringing about a considerable and lasting saving of resources, without any sacrifice of patient care. That is an important point.
  As for the short-term future, several rationalisation measures have been proposed. There has been a history of abortive consultations and it would be complicated and perhaps pointless to go into details, but in December, those measures and others taken under the urgent temporary procedure in the spring of 1985, together with further measures still to be implemented, were presented as a package to the health authority. These measures, and others as yet unimplemented, have been the source of the latest contentions.
  One proposal was the transfer of gynaecological and orthopaedic services from Beckenham which would have concentrated wholly on the care of geriatric patients. That was seen as workable and worthwhile, but trouble arose over the suggestion that gynaecology beds should be transferred to Farnborough hospital, where all acute beds in the south of the district would be concentrated, and that the number of acute beds in the district should fall drastically from 659 to 529.
  Reaction from the region has been felt, although the proposals have not been officially presented to the region.

  761
  I understand that there was a meeting of the regional chairmen and the chairman of the district on 15 January when it was agreed that the proposals affecting Farnborough and Orpington hospitals and the massive reduction in acute beds were simply not acceptable. I understand also that the district has accepted that view.
  The region has tried to be positive in suggesting other ways in which savings might be made, for example by rescheduling repayments of capital, deferring schemes jointly financed with the local authority, rationalisation at Cane hill hospital and other measures. The district can expect to come within about £500,000 of its expected 1986–87 shortfall — a sum which, with firm management, should be achievable without sacrifice of patient care.
  The region's suggestions will be discussed fully at the district health authority meeting in February. Should it be necessary for the DHA to consult formally local interested parties or others on its proposal, and if the Community Health Council objects, the matter may have to come to Ministers for a decision. If that happens, I assure my hon. Friend that we will take into account all factors, including those that he has mentioned.
  My hon. Friend kindly advised me of the three particular points that he wished to put to me. He asked whether the future of Orpington hospital was secure as the district general hospital serving the southern part of the district. My answer is a firm yes. There has been some recent speculation that acute services may be centred at Farnborough hospital, leaving Orpington to concentrate on the care of elderly and orthopaedic patients. That speculation resulted from proposals that had strong medical backing put to the DHA meeting in December. Those proposals will, however, categorically not be put into effect. At a meeting between the regional and district
  762
  chairmen and their senior officers on 8 January, it was agreed that the proposals ran counter to the district's longterm strategy to close Farnborough hospital within the strategic period and focus district general hospital facilities at Orpington.
  My hon. Friend asked about the future of Farnborough hospital. It is the district's long-term intention—10-plus years—to close Farnborough hospital, which is only two miles distant from Orpington. If that does not happen, Farnborough may be transferred into a smaller unit specialising in the care of elderly and elderly severely mentally infirm patients.
  My hon. Friend's final question was whether I could confirm that acute services at Orpington will not be run down. Again, my answer is the affirmative. The district's long-term plan is to concentrate acute services at Bromley hospital in the north of the district and at Orpington in the south. Bringing acute beds together on two rather than the present four sites may mean a reduction in the district's current overall number of acute beds, but, with careful rationalisation, that will not entail any sacrifice in patient care.
  I hope that I have said enough to reassure my hon. Friend about the future of Orpington hospital and the keenness with which the district, the region and the DHSS have followed the discussions on the provision of services, recognising the undoubted pressures that exist, but which apply, as my hon. Friend would be the first to say, to the NHS as a whole. Within the national resources that are increasing in real terms, I am convinced that the health care available to my hon. Friend's constituents will continue to improve in quality and, where appropriate, in quantity.
  Question put and agreed to.
  Adjourned accordingly at twenty-seven minutes to One o' clock.

PRIME MINISTER
  EC (Budget)
  EC (Budget)
  European Assembly
  European Assembly
  EC (Health and Safety)
  EC (Health and Safety)
  Cabinet Office
  Cabinet Office
  European Union
  European Union
  Leak Inquiries
  Leak Inquiries
  Fisheries
  Fisheries
  Westland plc
  Westland plc
  Privatisation
  Privatisation
TRANSPORT
  Channel Tunnel
  Channel Tunnel
  Vehicle Relicensing
  Vehicle Relicensing
  Radioactive Materials (Transportation)
  Radioactive Materials (Transportation)
  Marine Pollution
  Marine Pollution
  Road Accidents
  Road Accidents
  Leeds (Traffic Problems)
  Leeds (Traffic Problems)
  Stansted Airport
  Stansted Airport
  Operator Licensing System
  Operator Licensing System
HOME DEPARTMENT
  Motoring Convictions
  Motoring Convictions
  Prisoners (Accommodation)
  Prisoners (Accommodation)
  National Reporting Centre
  National Reporting Centre
  Auld Committee
  Auld Committee
  Immigration
  Immigration
  Police (Discipline)
  Police (Discipline)
  Motorway Accidents
  Motorway Accidents
  Neighbourhood Watch
  Neighbourhood Watch
  Visitors
  Visitors
  Animal Experiments
  Animal Experiments
  Military Aid to Civil Power
  Military Aid to Civil Power
  Sinsemilla
  Sinsemilla
WALES
  Training
  Training
  Community Programme
  Community Programme
  Wales Tourist Board
  Wales Tourist Board
  A5 (Traffic Flows)
  A5 (Traffic Flows)
  Primary Schools
  Primary Schools
  Farm Incomes
  Farm Incomes
  Advance Factories (New Quay)
  Advance Factories (New Quay)
  Hill Farmers
  Hill Farmers
  Social Services (Expenditure)
  Social Services (Expenditure)
  Teachers (Dispute)
  Teachers (Dispute)
  Urban Programme
  Urban Programme
  Cervical Screening
  Cervical Screening
EDUCATION AND SCIENCE
  School Buildings
  School Buildings
  ILEA Schools (Admission of Police)
  ILEA Schools (Admission of Police)
  Japanese and Russian Language Teaching
  Japanese and Russian Language Teaching
  Teachers (Dispute)
  Teachers (Dispute)
  University Staff
  University Staff
  Students (Maintenance Allowances)
  Students (Maintenance Allowances)
  School Examinations
  School Examinations
  Curriculum Development
  Curriculum Development
ATTORNEY-GENERAL
  European Assembly
  European Assembly
  Leak Inquiries (Immunity)
  Leak Inquiries (Immunity)
OVERSEAS DEVELOPMENT
  Southern African Development Co-ordination Conference
  Southern African Development Co-ordination Conference
ENERGY
  NCB (Enterprise) Ltd.
  NCB (Enterprise) Ltd.
  Energy Savings Opportunities (Exhibition)
  Energy Savings Opportunities (Exhibition)
NORTHERN IRELAND
  Voluntary Bodies
  Voluntary Bodies
  Matrimonial and Family Provisions Act 1984
  Matrimonial and Family Provisions Act 1984
  Equal Opportunities
  Equal Opportunities
  Benefits
  Benefits
  Single Payments
  Single Payments
  Pensioners
  Pensioners
NATIONAL FINANCE
  Inland Revenue (Cash Limit)
  Inland Revenue (Cash Limit)
  Enterprise Allowance Scheme
  Enterprise Allowance Scheme
  Public Expenditure
  Public Expenditure
  Police Officers (Rent Allowance)
  Police Officers (Rent Allowance)
  Capital Movements
  Capital Movements
  Tax Investigations
  Tax Investigations
  Sinsemilla
  Sinsemilla
FOREIGN AND COMMONWEALTH AFFAIRS
  Poland (Foreign Debt)
  Poland (Foreign Debt)
  UNESCO
  UNESCO
  Hong Kong
  Hong Kong
  Philippines
  Philippines
  East Germany (Compensation for British Citizens)
  East Germany (Compensation for British Citizens)
  South Atlantic Islands Development Corporation Limited
  South Atlantic Islands Development Corporation Limited
ENVIRONMENT
  Community Programme
  Community Programme
  Rate Support Grant
  Rate Support Grant
  Water Supplies
  Water Supplies
  Prefabricated Reinforced Concrete Houses
  Prefabricated Reinforced Concrete Houses
  Recycled Paper
  Recycled Paper
  Water and Sewerage Law
  Water and Sewerage Law
  Defective Housing
  Defective Housing
  Grants
  Grants
  Animal Furs
  Animal Furs
  Liverpool Philharmonic Hall
  Liverpool Philharmonic Hall
  Local Government Reform
  Local Government Reform
  District Heating (Newcastle)
  District Heating (Newcastle)
  General Certificate of Secondary Education
  General Certificate of Secondary Education
  "Faith in the City"
  "Faith in the City"
  Superstore (Slough)
  Superstore (Slough)
SCOTLAND
  Security Firms
  Security Firms
  Grants
  Grants
  Council House Sales
  Council House Sales
  Housing Associations
  Housing Associations
  Housing
  Housing
  Highlands and Islands Development Board
  Highlands and Islands Development Board
  Forestry
  Forestry
  Hypothermia
  Hypothermia
EMPLOYMENT
  Local Government Reform
  Local Government Reform
  Youth Wages
  Youth Wages
  East Midlands
  East Midlands
  Enterprise Allowance Scheme
  Enterprise Allowance Scheme
  Sheltered Employment Schemes
  Sheltered Employment Schemes
  Licensing Systems (Review)
  Licensing Systems (Review)
  Payment of Bills
  Payment of Bills
  Unemployed Persons
  Unemployed Persons
  Racial Discrimination
  Racial Discrimination
  Labour Statistics
  Labour Statistics
  Regional Manpower Strategy
  Regional Manpower Strategy
  Local Economic Initiatives
  Local Economic Initiatives
  Wages
  Wages
  EC (Employment Statistics)
  EC (Employment Statistics)
  Parental Leave Directive
  Parental Leave Directive
  Radar Equipment (Accidents)
  Radar Equipment (Accidents)
  Visual Display Units (Accidents)
  Visual Display Units (Accidents)
  Skilled Workers
  Skilled Workers
  Community Industry Scheme
  Community Industry Scheme
  Select Committee on Procedure
  Select Committee on Procedure
HOUSE OF COMMONS
  Sittings
  Sittings
TRADE AND INDUSTRY
  Plant Closures
  Plant Closures
  Machine Tools
  Machine Tools
  Computer Security
  Computer Security
  Beef and Cereals
  Beef and Cereals
  Export Controls
  Export Controls
  Implements of Torture
  Implements of Torture
  Leather Footwear (Exports)
  Leather Footwear (Exports)
  Regional Aid
  Regional Aid
  Telegraph Poles
  Telegraph Poles
  Consumer Statistics
  Consumer Statistics
  Research and Development
  Research and Development
  Regional Selective Assistance
  Regional Selective Assistance
  Concorde
  Concorde
  Suits (Imports)
  Suits (Imports)
  Departmental Staff
  Departmental Staff
  Land Rover
  Land Rover
  Overseas Companies (United Kingdom Acquisitions)
  Overseas Companies (United Kingdom Acquisitions)
  Imperial Tobacco
  Imperial Tobacco
  Steel
  Steel
  Export Credits Guarantee Department
  Export Credits Guarantee Department
  Export Credit (Fraud)
  Export Credit (Fraud)
  Engineering Companies
  Engineering Companies
  Kleinwort, Benson Ltd
  Kleinwort, Benson Ltd
SOCIAL SERVICES
  Supplementary Benefit
  Supplementary Benefit
  Social Security Reform
  Social Security Reform
  Exceptionally Severe Weather
  Exceptionally Severe Weather
  Single Payments
  Single Payments
  NHS (Pay)
  NHS (Pay)
  Domestic Service Advice Notes
  Domestic Service Advice Notes
  Hospitals (Cleaning Standards)
  Hospitals (Cleaning Standards)
  NHS (Private Contractors)
  NHS (Private Contractors)
  NHS Staff (Early Retirement)
  NHS Staff (Early Retirement)
  Linen Rental
  Linen Rental
  Health Authorities (Departmental Advice)
  Health Authorities (Departmental Advice)
  Laundry Services
  Laundry Services
  Residential Homes
  Residential Homes
  Mr. J. Lowry
  Mr. J. Lowry
  Dr. A. J. Blowers
  Dr. A. J. Blowers
  Departmental Staff
  Departmental Staff
  Post Offices (Services)
  Post Offices (Services)
  Supplementary Benefit
  Supplementary Benefit
  Hospitals
  Hospitals
  North-Western Regional Health Authority
  North-Western Regional Health Authority
  Benefits
  Benefits
  Pensions
  Pensions
  Breast Cancer
  Breast Cancer
  Non-dependant Deductions
  Non-dependant Deductions
  Registered Homes Tribunals
  Registered Homes Tribunals
  Heating Additions
  Heating Additions
AGRICULTURE, FISHERIES AND FOOD
  Farm Workers
  Farm Workers
  Sheep Worrying
  Sheep Worrying
  Less Favoured Areas
  Less Favoured Areas
  Feed-quality Cereals
  Feed-quality Cereals
  Poultry
  Poultry
  Surplus Food
  Surplus Food
  Nimrod Patrols
  Nimrod Patrols
  Monofilament Gill Nets
  Monofilament Gill Nets
  Agricultural Workers
  Agricultural Workers
THE ARTS
  Government Funding
  Government Funding
  Expenditure
  Expenditure
  Individual and Corporate Contributions
  Individual and Corporate Contributions
  Arts Council
  Arts Council
  Sadler's Wells
  Sadler's Wells
  South Bank
  South Bank
  Museums and Galleries
  Museums and Galleries
DEFENCE
  Service Widows (Pensions)
  Service Widows (Pensions)
  Service Personnel (Housing)
  Service Personnel (Housing)
  Research Expenditure
  Research Expenditure
  AOR Royal Fleet Auxiliaries
  AOR Royal Fleet Auxiliaries
  Research and Development
  Research and Development
  Low-flying Aircraft
  Low-flying Aircraft
  Defence Systems (Collaboration)
  Defence Systems (Collaboration)
  W30 Helicopter
  W30 Helicopter
  Harland and Wolff
  Harland and Wolff
  HMS Nelson
  HMS Nelson
  Naval Houses (Portsmouth)
  Naval Houses (Portsmouth)
  United States Bases
  United States Bases
  National Armaments Director
  National Armaments Director
  Civil Power (Military Aid)
  Civil Power (Military Aid)
  Dockyards (Redundancy Pay)
  Dockyards (Redundancy Pay)
  NATO Personnel (Regulations)
  NATO Personnel (Regulations)
  Service Personnel
  Service Personnel
  Service Personnel (Offences)
  Service Personnel (Offences)
  Cammell-Laird (Construction Work)
  Cammell-Laird (Construction Work)
  Helicopter Search and Rescue Services
  Helicopter Search and Rescue Services

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

Smallpox: Control Measures
Lord Campbell of Croy: 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 steps are being taken to ensure that no smallpox virus remains in this country, and that there is adequate control of dangerous pathogens.
The Minister of State for Defence Support (Lord Trefgarne): My Lords, I apologise in advance if this Answer is somewhat longer than is usual. General control of pathogens, as with other workplace hazards, is provided by the Health and Safety at Work etc. Act 1974. This places a duty on employers to take all reasonably practicable steps to safeguard the health of their employees and others.
Under the Health and Safety (Dangerous Pathogens) Regulations 1981, work with certain of the most dangerous pathogens, including smallpox, must be notified to the Health and Safety Executive. According to notifications received under those regulations, the last stocks of smallpox virus were removed from this country in 1982.
Inspectors from the Health and Safety Executive are investigating the recent discovery of material labelled smallpox SP22 at the London School of Hygiene and Tropical Medicine. The executive is satisfied that all appropriate steps have been taken to deal with any risks that may have arisen out of the discovery. Further steps have been taken to remind relevant employers of the requirements for safe working with pathogens.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for that very full reply. As vaccination is no longer in use in this country since it has been thought that smallpox has been eradicated, can my noble friend give an assurance, in the light of the recent discovery to which he has referred, that it is not necessary for vaccination to be restarted in this country? Can my noble friend also state whether there are now any countries in the world that have not eliminated smallpox from within their boundaries, and if so what countries they are?
Lord Trefgarne: My Lords, I can certainly confirm that no danger at all has arisen from the incident to which the Answer referred and to which I suspect my noble friend was referring as the basis of his Question. As for the risk in other countries, so far as I know smallpox has been eradicated from the world altogether, although there are occasionally cases that occur and have to be dealt with.
Lord Ennals: My Lords, am I not right in believing that a stock of smallpox virus is known to be held in the United States and in the Soviet Union? If that is so, can the noble Lord say why it is so and for what purpose it is held, bearing in mind, as the noble Lord has said, that the WHO has declared that smallpox has been eliminated? Secondly, can the Minister throw any light on the apparent failure of the London School of Hygiene and Tropical Medicine to co-operate with the Health and Safety Executive in the light of the circular to which he referred?
Lord Trefgarne: My Lords, I can confirm that, as I understand it, the virus is held only in the United States and in the Soviet Union. I understand that it is kept there for research purposes. How it came to be found in the London School of Hygiene and Tropical Medicine is a matter now being investigated very fully. I fear that I cannot go further than that.
Viscount Hanworth: My Lords, am I right in believing that if by any unfortunate chance smallpox broke out somewhere in the world, then we should require the original smallpox stock in order to make a vaccine to deal with the disease and that therefore it must be retained somewhere?
Lord Trefgarne: My Lords, I have to confess that I am not entirely certain what materials are required for the preparation of the vaccine; but I can assure the noble Viscount that should the vaccine be needed, then it would be made available in whatever quantities were required.

British Summer Time
2.40 p.m.
Viscount Mountgarret: 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 British summer time might start in future on the last Sunday in February instead of on the last Sunday in March.
Viscount Davidson: My Lords, on 19th December 1985 your Lordships' approved an order that has the effect of continuing the present date for the start of summer time for a further three years. In proposing that, Her Majesty's Government took the view that that date, which is now uniform throughout member states of the European Community, represented the most satisfactory compromise between those who sought more daylight in the afternoon and those who opposed the loss of daylight in the early morning.
Viscount Mountgarret: My Lords, I am grateful to my noble friend for that reply. I wonder whether the Government will be kind enough to bear in mind that currently as British summer time is brought to an end there are seven weeks before the shortest day, and that we reintroduce it again approximately 15 weeks after the shortest day? Reintroducing summer time at the end of February would mean a disparity of only 11 weeks on one side and seven weeks on the other. Will the Government be good enough to hear that point in mind?
Viscount Davidson: My Lords, I shall certainly take note of my noble friend's remarks. Perhaps I may add that the order to which I referred sets out the dates for the start and finish of summer time for 1986, 1987 and 1988. Therefore, the matter is to that extent a fait accompli for the next three years. As a result, I am not in a position to give my noble friend any encouragement; but I suggest that he raises this matter again some time towards the end of 1988.
Lord Mishcon: My Lords, has not the noble Viscount who asked this Question a most pleasing sense of humour: to suggest that British summer time be commenced at the end of the present month?
Viscount Davidson: My Lords, all I can say in reply is that although we have summer time, that does not mean that we can guarantee a summer.

Animal Diseases and Farm Livestock Units
2.42 p.m.
The Earl of Shannon: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the indiscriminate establishment of large farm livestock units constitutes a danger as they may lead to the spread of infectious animal diseases such as foot and mouth disease.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead): My Lords, larger units of production have been a feature of the livestock industry in both this country and in other member countries of the European Community for some years. The difficulties likely to be encountered on such holdings in the event of a major disease outbreak such as foot and mouth disease would include speedy and safe disposal of carcases and slurry and the valuation of stock. Our contingency plans are designed to take account of such factors. The action would of course depend upon the circumstances but infected area controls, which are enforced around all outbreaks, are specifically designed to prevent the spread of disease.
The Earl of Shannon: My Lords, I thank the Minister for that reply. May I ask, further, for an assurance that the Minister's department fully appreciates the fact that it is now known that only one infected pig can generate 10 to the power of eight infected viruses in only 24 hours? If there are, as I know there to be, at least three, if not more, intensive pig units of over 10,000 pigs in each unit in the south of England, should one or more of those units become infected it would, with our prevailing south-westerly winds, spread a wind-borne plume of infection over most of the country and put pretty-well the whole of the hoofed population of this country at risk.
Lord Belstead: My Lords, I understand the noble Earl's concern. We keep records of the large livestock units on a computer and also records of where slaughter houses are sited so that we know where they are and can give advice whenever necessary. Advice has already been given to owners of large livestock units on precautions to prevent the introduction and spread of disease.
Lord John-Mackie: My Lords, without doubting the noble Lord's calculations, am I right that in the nasty outbreak of foot and mouth in 1967–68 the spread was among small units? I cannot see that the size of the unit makes any difference to the spread of disease.
Lord Belstead: My Lords, I am glad the noble Lord, Lord John-Mackie, asked that question because I join with him in being to some extent perplexed by the thrust of that supplementary question from the noble Earl, Lord Shannon, in the sense that in a large livestock unit the space devoted to each particular animal is not likely to be any less than the space in a smaller livestock unit. None the less, I recognise the general thrust of the noble Earl's original Question, in that if there is an outbreak of disease the difficulties of clearing up after such an outbreak in a large unit are, of course, very great indeed.
Lord Paget of Northampton: My Lords, speaking from memory, but quite a long memory and not one

5
which is wholly concerned with agriculture on this subject, but an intense interest as to where and when foot and mouth outbreaks occur, am I wrong in remembering that they almost always occur on small farms?
Lord Belstead: My Lords, I cannot answer that. I shall look at the records and write to the noble Lord.
Viscount Hanworth: My Lords, is it not a fact that the spread of disease requires, with one or two exceptions, a substantial number of bacilli before infection occurs? Therefore, if it is wind-borne and it comes from a very large herd, is there not a greater chance of infecting others than if it comes from a small number of pigs and where again the bacilli is distributed by the wind? It is therefore less effective.
Lord Belstead: My Lords, with respect to the noble Viscount, I very much doubt whether that is the case. As I understand it, so far as foot and mouth is concerned, in the event of the tragedy of an outbreak the direction of the wind and the currents of the air are the absolutely crucial factors.

Mr. Alan Bristow: Alleged Knighthood Offer
2.47 p.m.
Lord Stallard: 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 have any knowledge of an offer of a knighthood to Mr. Alan Bristow.
The Lord President of the Council (Viscount Whitelaw): My Lords, it is not for me to question statements made by Mr. Bristow, but I can assure your Lordships that it is not possible within the workings of the honours system that any such offer could effectively have been made.
Lord Stallard: My Lords, I am grateful to the noble Viscount for that reply. I very carefully noted Mr. Bristow's exoneration of the Prime Minister from any connection with this allegation. However, does the noble Viscount accept that there is great public disbelief that a man of Mr. Bristow's background, character and obvious and active support for the Tory Party could conceivably have fabricated such an allegation? In view of the fact that two Members of your Lordships' House have been mentioned in this inducement, and the fact that that brings suspicion on all of us in this House, will the noble Viscount initiate an inquiry so that we may ascertain the truth and lift that suspicion?
Viscount Whitelaw: My Lords, in the first instance, the moment that the noble Lord said that Mr. Bristow had exonerated the Prime Minister he even more effectively made my point, that within the present honours system no such offer could conceivably have been made. Secondly, it is not for me to either confirm or deny the noble Lord's propositions about Mr. Bristow since I must say—and I do not say this in any
6
way offensively—that I have no knowledge of Mr. Bristow in any resort or regard. I have met him, but I have no knowledge of his political affiliations.
Finally, I certainly do not see how such an offer—which, if it ever was made must have been in the form of gossip and tittle-tattle—could conceivably become the subject of an inquiry in your Lordships' House, and I do not believe that your Lordships would wish it to be so.
Lord Peyton of Yeovil: My Lords, does my noble friend not agree that those who originate such suggestions without revealing their sources must expect thereafter to have very little weight attached to anything that they say; and that those who circulate such suggestions do themselves very little credit indeed?
Viscount Whitelaw: My Lords, I think that it would be proper for me, having set out on one course, to maintain it and simply say that I have no comment to make about Mr. Bristow in any way at all.
Viscount St. Davids: My Lords, is it not clear that any Peer who offered Mr. Bristow an honour of any kind must inevitably have been suffering from certifiable insanity and is thus exclusible from this House?
Viscount Whitelaw: My Lords, that specific question shows how wise I am to refrain from any particular comment on this issue.
Lord Hatch of Lusby: My Lords, in his repeated defence of the honours system, which I have heard him make on radio and television and which has been repeated this afternoon, is not the noble Viscount the Leader of the House asking us to be a little gullible? Is it not the case that there is nothing unusual in Members of this House, or indeed other members of the political system, promising to recommend that an individual be given a knighthood or indeed a peerage? As regards Mr. Bristow, is it not the case that he is well qualified for it, in view of this Government's record on recommendations for honours, in that not only is he a very wealthy man but he has also contributed substantially to the funds of the Conservative Party? Does that not qualify him, in view of the number of honours that have been given in the life of this Government to such members of the public who have been contributing to Conservative Party funds?
Viscount Whitelaw: I think I am right, my Lords, to confine myself to saying that I really do not know Mr. Bristow's position, because more and more assertions are made about Mr. Bristow which I can neither confirm nor deny. Concerning the honours system, of course there will be very few people in this House—and I of all people would not expect to be immune—who do not hear people come up to them from time to time and say, "Wouldn't it be a good idea, old boy, if I joined you in the House of Lords?" Of course I have heard that on all sorts of occasions. But even if I were to say, "Yes, I think that would be absolutely splendid", I would not actually be making an offer, nor would I be making a recommendation, because in every regard the checks and balances in our

7
honours system are very considerable, as your Lordships know very well, and they have been there for a long time. To engage in gossip and tittle-tattle about this sort of thing does not, I think, really do us much good. It may be fun, and it may be amusing, but I do not think it is very realistic.
Lord Stallard: My Lords, may I say to the noble Viscount that it it not good enough to dismiss these statements as "tittle-tattle". Is the noble Viscount aware that it is not good enough to try to denigrate Mr. Bristow (who, I understand, and my friend has mentioned, is a regular contributor to Conservative Party funds) and to dismiss the whole thing as "tittle-tattle", when we all watched the television bulletins and reports in which Mr. Bristow clearly said that this was an eyeball-to-eyeball confrontation with some people from the House of Lords who, as he understood it, made him a firm offer of an honour? I do not think we can just dismiss it. If there are offers of that sort, we ought to know. I ask the noble Viscount again: would he reconsider the decision not to set up some kind of inquiry to get to the truth?
Viscount Whitelaw: My Lords, in fairness to myself (because if you are not fair to yourself nobody else is ever likely to be) I do not think that at any time I have made any statement which was in any way derogatory to Mr. Bristow. I have indeed been most careful not to do so. Secondly, I cannot see that there is any purpose in having an inquiry. I described what happened as "tittle-tattle", and I would simply say that if the sort of occasion in which many of your Lordships must have taken part from time to time had taken place, then the sort of gossip which might continue on these matters does qualify later on in the light of day as tittle-tattle, and I think I am entitled to described it as such.
Lord Kinnaird: My Lords, may I ask my noble friend the Leader of the House to bring all this nonsense to an end? It so happens that I shall be lunching at Claridges Hotel tomorrow. If it would be of any use to make a few discreet inquiries, I should be delighted to be of help.
Viscount Whitelaw: I can only note my noble friend's suggestion, my Lords.

Fraud Trials Committee Report
2.55 p.m.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, we move, I hope, from the ridiculous to the sublime, and I rise to move the Motion standing in my name on the Order Paper. Before I do so, may I say what a pleasure it is to note from the list of expectant speakers that my noble and learned friend Lord Roskill himself is to take part in the debate; and I also look forward with eager anticipation to the maiden speech of the noble and learned Lord, Lord Griffiths, and to the maiden speech
8
of the noble Earl, Lord Buchan, who I suppose is a collateral descendant of my noble and learned predecessor, Lord Erskine.
We discussed the remarkable document which forms the subject matter of this debate briefly on the 14th January when I repeated in this House the Home Secretary's statement on its publication. On that occasion I described the report as one of the most masterly, important and well written documents which I have read in recent years.
I have had no occasion to regret, and I have no desire to revise, that appreciation. All the same, the form of this Motion, which is to take note, means exactly what it says. It means first of all that if I have anything to do with it the Government are determined to take action, but that the contents of the report and the detail of the action are wide open for discussion today. My predecessor, the noble Lord, Lord Campbell, once said that law reform is by consent or not at all. It therefore follows that unless the results of this discussion and that which follows in another place are to produce a firm consensus not confined to the Government as such, both as to the necessity for action and the form which action should take, like so many other reports the result of this one will be less than the minimum necessary.
I therefore begin with a plea, which I made in another form on the 14th January, that whilst everyone will be quite uninhibited in criticism or in support, no one will adopt stances from which it is impossible to resile with honour, and that everyone, after expressing either his or her opinions or reservations, will take back for a period of self-questioning the opinions of others. I tried to express the view that anyone reading this report ought to realise that its real underlying message is that we are trying to operate a ramshackle and obsolete system of trial in a situation to which it is not readily adapted, and that to remedy that situation we, the public and the profession, must be prepared to examine with a detached and coldly appraising eye each his own herd of sacred cows and ask himself whether they are still capable of yielding any holy milk.
I was greatly encouraged, at least in part, by the reception given to the report by the noble and learned Lord, Lord Elwyn-Jones, and by the noble Lord, Lord Wigoder, from the Front Benches of their respective parties. Indeed my only criticism was that I thought that each of them might have been too cautiously conservative in his approach.
I was vastly encouraged in particular by the quotations which were made by the noble and learned Lord, Lord Elwyn-Jones, from the report itself. He had got the message and he had got it right:
"All the available evidence indicates that, in the United Kingdom, fraud is a growth industry … Fraud is posing a threat to London as a financial centre".
He went on to quote:
"The public no longer believes that the legal system in England and Wales is capable of bringing the perpetrators of serious frauds expeditiously and effectively to book. The overwhelming weight of the evidence … suggests that the public is right … the present legal system is archaic, cumbersome and unreliable.
"At every stage, during investigation, preparation, committal, pre-trial review and trial, the present arrangements offer an open invitation to blatant delay and abuse … The largest and most cleverly executed crimes escape unpunished …".

9
The noble and learned Lord, again quoting the report, said quite rightly and, if I may say so, sternly to the Government:
"If the Government cherishes the vision of an 'equity owning democracy', then it also faces an inescapable duty to ensure that financial markets are honestly managed and that transgressors … are swiftly and effectively discouraged, convicted and punished".
That is a challenge by the report and by the noble and learned Lord which I happily accept on behalf of the Government, but at the same time I think I am entitled to say to the Opposition, the Cross-Benches, the profession and the Bishops' Benches, too, that this is not going to be a comfortable matter for any of us. It will involve serious expenditure, controversial decisions and a willingness to legislate, which can only be done by a wholehearted willingness to support whatever government may be in power to put down the crime of fraud wherever it is found, remembering only that the fundamental rule of criminal law is to convict the guilty and acquit the innocent, so far as it can be done, without destroying the other fundamental rule, that the burden of proving a case rests on the prosecution and that we must by no means buy temporary popularity for vigorous and even dramatic action at the cost of convicting innocent men or women, for, if there is one thing worse than not convicting fraud, it would be the belief that our system of justice could not be relied on to acquit the innocent.
Your Lordships will notice that I mentioned the Bishops' Benches. I had originally intended to refer to reports by the most reverend Primate the Archbishop of York, of which I gave him notice. I was going to make a comment that he had struck a false note when he made in this very connection what both The Times and the Daily Telegraph referred to as a wide-ranging attack on "Britain's enterprise" society. However, he courteously replied to me with two copies of his interview and one of his excellent Christmas sermon saying that he had been largely misreported. I therefore refer only to the interpretation of The Times and the Daily Telegraph of what he was alleged, perhaps unjustly, to have said.
The more one believes in private enterprise, the more important it becomes to put down fraud. Private enterprise is based on confidence. If men do not trust one another they cannot trade; and, as the Roskill Report rightly' points out in the passages I have quoted, confidence is destroyed if fraud is allowed to succeed unpunished. Indeed, as I have pointed out, the report went on to say that unpunished fraud is a threat to London and therefore to the country as a financial centre. Private enterprise remains about confidence and about credit, and that means mutual trust. If one undermines confidence, one undermines private enterprise; and we cannot have confidence where fraud goes undetected or unpunished.
Nor must we forget, for those who are less enthusiastic than I about private enterprise, that the Revenue, and therefore the taxpayer, is frequently made the victim of some of the most ingenious and profitable fraud. So that in this enterprise of putting down fraud there should be no party politics at all and there is no conflict between the public and private sectors. It is the common interest of us all to pursue this matter to the end.
It is, I think, not in the interest of the debate that I should at this stage discuss in detail the Government's
10
attitude to individual recommendations. Although my noble friend Lord Glenarthur will be fleshing out some of the detail at the end of the debate, I do not think that it would be right for me to do so now. It is clear, however, that on the most conservative view there are very important implications in resource terms both in terms of judicial power and other manpower resources. If we are serious, we must make these resources available to the maximum of our ability. In the case of judges, however, it is clear that there is a further limitation on me which does not depend on government decision; that is, the availability of manpower of adequate authority and quality. On the rest of the field the Home Secretary has already indicated that the Department of Trade and Industry is recruiting nearly 200 new staff over the next two years, and that nine extra lawyers with supporting staff are being added to the department of the Director of Public Prosecutions.
I hope the House will recognise these as fair indications of our seriousness of purpose, and will also bear in mind that this is also established by the mere fact of the Government setting up this distinguished committee, with Lord Roskill at its head, and the numerous other steps which have been taken during this Parliament and its predecessor to strengthen our powers in this field. In these I include the Companies Act 1980, Professor Gower's work in the field of investor protection, the establishment of the Fraud Investigation Group, the Insolvency Act and the current Financial Services Bill.
But I think now I have the right to raise certain fundamental questions with members of my own profession, the press and the public. The Roskill Report frankly recognises that you cannot reorganise the law of fraud without there being, in the end, repercussions on the general criminal law and procedure of England and Scotland. How far is that view justified? Personally I welcome that approach. In the first place, as I indicated on 14th January, I think the committee has established that crimes of fraud differ from "ordinary" crimes like riot, theft, burglary, rape or murder. This is not because crimes against property differ relevantly in character from crimes against the state or the person. That would be foolish thinking. As the committee points out, it is because most crimes burst into the open by overt action, while fraud thrives best in the dark, by concealment, by falsification of accounts, in complex games played with a Russian doll system of limited liability companies and by skilful use of foreign systems of law, such as operate in non-extradition countries or countries with stringent banking laws forbidding the disclosure of necessary information.
But there is another reason why I welcome this approach. In criminal law it is difficult to experiment with real cases. The result is its extraordinary rigidity and conservatism. Each time a change is proposed we are faced with the perfectly realistic proposition that human liberty and civic rights are involved, and so they are. But have we ever asked ourselves how many of these liberties and rights were evolved to deal with dangers which no longer exist? There is the hearsay rule, for instance. Prosecutions were once often in private hands and prisoners could not give evidence on their own behalf, as they could not until 1898. And, in most serious cases, in earlier days, prisoners were

11
denied the assistance of counsel or solicitors even when they could pay for them, when there was no disciplined police force in existence, no appeal in criminal cases (not effectively until 1907. although, of course, before that, there was the Court of Crown Cases Reserved), no prison rules, no public education at all, and, of course, until about 1962, no legal aid. I welcome this opportunity myself to deal with fraud as a special case, not in spite of the fact but because of the fact that, in dealing with it separately, we may gain experience that may prove some day, long after perhaps I have gone, valuable in another field.
As I have said, this might apply to the hearsay and best evidence rules which, during my lifetime at the Bar, have virtually disappeared in civil law. And, although, of course, no one would suggest abolition of the right of silence, surely the report is correct in questioning whether an efficient system does not demand a greater degree of candour between both sides, if they are properly represented, as to the true nature of fact to be determined by the jury when the time for trial arrives. Have we ever asked ourselves the extent to which an artificial and excessively rigid system can operate against the administration of justice, both in the interests of the defence as well as of the prosecution?
Surely, I was right to draw attention to the passage in the report which says:
"We have no doubt that most ordinary jurors experience grave difficulties in following the arguments and retaining in their minds all the essential points at issue particularly in a long hearing of a complex character. This creates the serious risk either that the jury will acquit the defendant because they have not understood the evidence or will convict him because they mistakenly think they have understood it when they have in fact done little more than applied the maxim there's no smoke without fire."
In other words, I ask the question point blank: is the fact that an inefficient and archaic system is unfair to the prosecution any guarantee at all that it is a protection to the innocent?
Then, there is the question of delay which is a recurring theme in the report—delay in investigation, delay in committal, delay in prolongation of the hearing and, cognate though not identical with this, the difficulty of appealing against an unsatisfactory verdict when ex hypothesi no reasons are given. Is it obvious that because such things make it more difficult for the prosecution to secure a conviction in the guilty cases, they necessarily make it easier for an innocent man to secure an acquittal? We know, alas, that despite all our wills to the contrary, there have been cases of conviction of the innocent. We must be careful to see that, so far as human ingenuity can secure it, these do not occur again. May not inefficiency be an enemy of justice in the interest of both sides by making the result of a trial more the plaything of chance than a matter of certainty? Our system depends on oral testimony. Delay blunts the memory and reduces the reliability of witnesses. But this may operate against innocent defendants as well as against the successful prosecution of the guilty.
In this connection, I must also raise the question implicit as part of the report, and not at all forgetting and not in the least discounting the powerful dissentient opinion of Walter Merricks, regarding the jury itself. I myself regard the jury as one of the
12
palladia of our liberties. They try many serious crimes to general public satisfaction. But this may not be so in every kind of case. In some cases known to us all—the more trivial—the speed and informality of the magistrates' court is clearly preferable. Are we sure that there are not other cases at the other end of the spectrum? In a case that, to everyone's knowledge, is going to last six months, or even three months, what sort of a random jury can be obtained who can sit day to day all the time without being excused from service? And how many people is it fair to ask to perform the function of a jury in such a case even if we abolish, as the report suggests, peremptory challenge and the right of the Crown to stand by, given that jury service is compulsory, continuous and unpaid?
I sometimes wonder whether Members of another place and ourselves would be quite so vociferous in support of jury trials, and members of the profession itself be quite so vociferous in support of jury trials, were they themselves liable to be called up compulsorily for jury service. I beg the House not to approach this difficult question in an atmosphere of religious awe, but simply to try and answer the question as it would be inclined to attempt the answer to any other difficult and serious matter connected with justice and with law. Remember, we are not engaged in some kind of ritual dance or tribal ceremony, or a fox hunt with men in red coats and properly selected hounds and ritual rules! We are dealing with the lives and liberties of men and women and the vital interests of society.
I emphasise once more that it is no part of my intention to foreclose this debate by announcing premature conclusions by the Government which can only serve to cause others to stand on premature and dogmatic conclusions of a different kind. There is at this stage only one point on which I should like to supplement or amplify what my right honourable friend the Home Secretary said on 14th January. That relates to Recommendation 13 of the report, which relates to the substantive law of fraud and talks about an offence that has fraud as its label or designation.
The point which the Criminal Law Revision Committee is to be asked urgently to examine is the problem, in itself narrow, but also extremely important, relating to the law of conspiracy, thrown up by your Lordships' judicial decision in the case known by the name of Ayres about conspiracy to defraud. The more complex question as to whether a new statutory offence labelled fraud should be created looks to me much more like a question for the Law Commission than for the Criminal Law Revision Committee. The examination of that question seems to me likely to take a great deal more time than the Ayres point to elucidate, or even the legislation of a different kind that we are likely to need in the near future. I do not think that the answer to it will be contained in the earlier legislation which will be necessary on most other aspects of the report. My right honourable friend and my own department will be in touch with the Law Commission on the other aspects of reform of the substantive law.
I look forward greatly to the outcome of this debate, and to the wider debate in another place and in the public domain that will surely follow. I ask only that we should start with open minds. Do not the laws of

13
evidence need reform? In complex frauds, especially those which have been the subject of inspection reports under the Companies Acts, do old-style committals with their delays, their longhand depositions and so on, serve any contemporary useful purpose? Do we accept the need, which the report stresses at great length, for a more thorough pre-trial preparatory hearing with proper counsel and a judge devoted to the case, each properly remunerated? Is the present system of jejune indictments, without the clearer definitions of issue which remain at present in vogue, in the interests of the prosecution, or the defence or the administration of justice? How far is a legally represented defendant in a complex fraud with a defence entitled to conceal that defence for tactical reasons with a view to taking the prosecution by surprise? Is it in the interests of an innocent defendant to do so? If he does so, are the present rules relating to the right of the prosecution or the court to comment really in the interests of justice?
In all these cases I cannot conceal my belief that the criminal process is not a game, a sport or a ritual dance. Its purpose is to convict the guilty, acquit the innocent, and to treat as innocent those who are not proved to be guilty. There are, of course, matters where facts logically probative have an emotional impact too large to be freely admissible. An obvious case of course is the case of previous convictions. There are also methods of interrogation too unacceptable to be permitted even where they yield logically probative evidence. There are areas in which the criminal process in fraud must have an ultimate impact on the criminal process on crime generally. But that time is not yet come.
We must not experiment with human rights. But we are not merely bound to attempt innovation in particular fields. We must see how the innovation works if we introduce it. Nevertheless, can we not at the end of the twentieth century agree that the general rule should be that what is logically probative should be admissible in evidence, and reliability and weight should be for the jury rather than the judge? I mean, of course, a properly directed jury. And can we not agree that what is time-saving and efficient is as a general rule a better guide to truth in the interests both of prosecution and defence than what is artificially rigid, unnecessarily protracted, or obviously designed to meet situations and dangers which no longer exist? My Lords, I fear that I have already outstayed my welcome. I beg to move.
Moved, That this House takes note of the Report of the Fraud Trials Committee.—(The Lord Chancellor.)
3.23 p.m.
Lord Elwyn-Jones: My Lords, I am most happy to join with the noble and learned Lord in commending the vigour, the quality and the masterly nature of the Roskill Report. As I shall indicate in my observations, I do not agree with all of it but that will probably be no surprise to anyone. I am also happy to join the noble and learned Lord in stressing his and my awareness of the extent of the challenge of fraud and dishonesty to our commercial life in this country. Yesterday the press reported that a study commissioned by the Home Office into the level of fraud in the United Kingdom in its financial community is believed to
14
have estimated the level of losses at around £750 million a year. It is an enormous sum. It is an appalling indictment.
The Roskill Committee was not charged with the responsibility of examining how it is that in the last few years this deeply disturbing state of affairs should have come about, and how it comes to pass that fraud and fraudsmen should proliferate so greatly and so effectively. Perhaps it is high time that those questions were examined and tackled. I fear it is the case that the Roskill Report indicates that a concerted drive against the fraudsman was long overdue.
As far back as 1978 a working party was established by my noble and learned friend the then Attorney-General, Lord Silkin—I am glad to see he is going to speak today—to review the arrangements for the investigation and prosecution of fraud, and to examine the role and co-ordination between each of the authorities with responsibilities in this field.
It was apparently, however, not until 2nd January 1985 that the permanent fraud investigation group arrangements came into being within the department of the Director of Public Prosecution. Changes in the method of investigation, as the report points out, have been brought about very slowly. The report adds the fact that even now only two departments—the DPP and the DTI—are directly involved in these arrangements, that the police retain their independence, and that the Inland Revenue and Customs and Excise remain outside the arrangements. They conclude that these are all matters of concern. The House may like to learn from the Lord Chancellor whether any progress has been made or is being made in regard to these matters of concern.
The committee stressed that the need for an organisation responsible for all of the functions of detection, investigation and prosecution of serious fraud ought to be looked at afresh, and that such an inquiry should be set in hand forthwith. I appreciate that the report has not been in the hands of the Lord Chancellor for very long. But I hope that I may be allowed to ask what steps are being taken to put that matter in hand, and what is contemplated.
The number of bodies who are presently involved in different areas of fraud investigation, and the disparity between their functions and powers, seem to reflect no more than a piecemeal approach to this problem. The appearance of the report was indeed most timely in regard to the state of affairs which they discovered. The committee make valuable proposals for an independent monitoring body—the fraud commission they call it—to study and advise from year to year on the efficiency with which fraud cases are conducted. They propose that the fraud commission should make an annual report which should be published. If I may say so, that is a suggestion with which I wholeheartedly agree. Perhaps when the noble and learned Lord and Lord Chancellor has an opportunity of hearing what I am saying, he will indicate whether he agrees, first with the view on the founding of the fraud commission; and secondly, with the suggestion that it should make an annual report.
The committee in their massive work approached their task of considering how the conduct of criminal proceedings arising from fraud can be improved methodically, as one would expect from so expert and

15
experienced a membership. They considered each stage in the processing of a suspected fraud from the time when it first comes to the attention of the authority to its ultimate disposal. They made various recommendations relating to each stage. Many—indeed, I venture to think the majority—are uncontroversial, and many are beneficial. I shall not of course attempt to cover the ground. But happily the expert list of noble and learned Lords, and indeed noble Lords who are to follow me indicates that these matters will be pretty thoroughly exposed and discussed during the course of our debate.
May I ask one question at the beginning of the process of studying the covering of the ground from discovery of the fraud to its ultimate treatment in court? As to the substantive law of fraud itself, this has been most usefully examined, and the problems helpfully highlighted by the committee. They recommend that those questions of law should be referred to the Law Commission. Perhaps the noble and learned Lord will give an indication as to whether that is contemplated. Indeed, perhaps the mere fact that it is on the record of the report may result in the Law Commission acting in that regard anyway.
To begin at the beginning, the report recommends that committal proceedings should be dispensed with. I personally do not think that committal proceedings add very much to the due administration of justice, whereas they undoubtedly cause considerable delay. It may well be that they achieve little which could not be achieved in the Crown Court itself However, the report's proposal that in cases of complex fraud the prosecution should be able to issue a transfer certificate which circumvents the committal proceedings and brings the matter into the jurisdiction of the Crown Court without reference to the courts and without possibility of challenge by the defence, will require most careful examination if and when we see that proposal in a Bill. We shall need to consider whether the existing procedure for preferment of a voluntary bill of indictment may not indeed be preferable.
The report's proposals regarding pre-trial proceedings and pre-trial reviews are, I venture to think, very important in order to achieve the smooth running of the trial. I welcome the proposal that the learned judge should be empowered to direct the preparation and use of virtual, or rather I should say "visual" aids for the trial (I hope that they are also virtual aids for the trial) as the proceedings continue.
However, there is one proposal which I submit will need most careful consideration before we make it part of our law. I refer to Recommendations 58 and 59 of the report. Recommendation 58 says:
"The law should be altered so that the defence are required to outline in writing the nature of their case at the preparatory hearing stage".
Recommendation 59 says:
"If a defendant fails to disclose his defence in advance of the trial the following sanctions should be available:

(i) The prosecution and the judge should be entitled to comment at the trial, and the jury should be entitled to take account of and draw any appropriate inference from the defendant's failure to disclose a particular line of defence on which he relies at the trial.

16

(ii) Where the failure to make prior disclosure of the defence has unnecessarily prolonged the trial, the sanction of costs should be available".

Recommendations 64 and 65 are also relevant and important in this field. Recommendation 64 says:
"The prosecution should be required to serve a notice on the defence requesting admissions of facts. The defence should be required to serve a counter-notice stating which facts are admitted and which are not giving their reasons".
Recommendation 65 says:
"Failure to make admissions of fact which are not the subject of challenge at the trial and which a jury might after hearing all the evidence think any reasonable innocent person would have been ready to make should be capable of attracting comment by the judge and the prosecution".
The question which I venture to raise is this. Do not these proposals challenge a fundamental principle of our criminal law; namely, that a man shall be presumed innocent until proved guilty? That principle, which is now embodied in Article 6(2) of the European Convention on Human Rights, has two consequences. First, it is for the prosecution to prove their case. The Crown, if it seeks to accuse an individual, hears the whole onus of proof of every part of its case. Secondly, the defendant has no obligation to assist the prosecution. In my submission, the report dismisses those principles a little too readily. I venture to suggest—I hope without impertinence—that perhaps even the noble and learned Lord the Lord Chancellor did the same.
Paragraph 5.25 of the report reads:
"If society wishes to see the successful prosecution of those who are believed to have swindled large numbers of people, whether large investors or small investors, out of their assets, it must be prepared to stop the use of these ancient rules of evidence".
As if, my Lords, that dismisses them. The difficulty of proving a complex fraud case is recognised. However, I submit that that cannot justify shifting the onus of proof on to the defendant or relaxing the requirements of proof.
The Lord Chancellor: My Lords, I do not want to interrupt the noble and learned Lord, but if he reads in Hansard what I said, he will acquit me completely of seeking to displace the onus of proof. However, I do not wish to interrupt him further.
Lord Elwyn-Jones: My Lords. I hope that I also may be allowed to continue with what I was endeavouring to submit to the House. I detected in the noble and learned Lord's speech a visible shifting of the onus from the prosecution to the defence. However, we shall each look at what we have said in each other's words and it is for their Lordships to hear and to listen to what we respectively have to say. I hope that, without too much sense of religious awe—as though that has become a new term of abuse in this House—and without being too dogmatic, the matters which I am endeavouring to raise will be given such consideration as they deserve. The House will appreciate the difficulty of proving a complex fraud case. I stress that its complexity does not or should not affect the relaxation of the requirements of proof. As regards that matter we shall have to wait to see the precise language of any Bill which seeks to give effect to this matter and we shall continue our argument further in the light of the printed word.

17
As Justice has submitted, even correct convictions secured by unfair means undermine faith in law and justice. Undermining that faith is too high a price to pay for getting a few more convictions for fraud.
In practice I ask: is it not the case that even now the acquittal rate in respect of fraud trials is no greater—in fact it is actually less—than for trials in general? It is of course right that, so far as possible, all formal or non-contentious matters should be disposed of by agreement so that time is not wasted on formal and unnecessary evidence which should be dealt with at the proposed preparatory hearings.
It is in regard to what is perhaps the most fundamental of the Roskill Committee's recommendations—namely, the abolition of trial by jury in complex fraud cases—that the greatest controversy will inevitably arise. It is fair and right to say that the proposal will only bite on complex fraud cases. As the report states:
"Despite all its shortcomings, we find trial by jury an acceptable procedure for the vast majority of cases".
It is for what are described as "complex fraud cases" falling within the stated guidelines, that the committee proposes that a different tribunal is required which it calls the "Fraud Tribunal", consisting of a judge sitting with two lay members.
The report concedes that it is not possible to give a precise definition of a complex fraud case. They also say:
"We have not been able to obtain accurate evidence whether there have been many doubtful acquittals or convictions in fraud cases or whether many retrials have been caused by a failure to secure jury agreement".
Then they say:
"There is no accurate evidence which we have been able to obtain to suggest that there has been a higher proportion of acquittals in complex fraud cases than in [ordinary] fraud cases or other criminal cases generally".
Mr. Merricks, in his notable note of dissent, said this:
"Most judges and lawyers who made submissions to us thought that juries mostly reached the right result, or at least an understandable result".
He adds:
"we have only anecdotal and second hand evidence on the central question at issue. Even that evidence, however, did not point unambiguously towards the conclusion that jurors cannot and do not understand fraud cases".
That was Mr. Merricks' analysis of the evidence that the committee heard. It is for us to consider what weight to attach to it.
On the broad constitutional question raised by the proposed abolition of the right to trial by jury, I agree with the view of the noble and learned Lord, Lord Devlin, that the right to jury has become so much of an institution that it has become more or less a convention of the constitution that citizens should not be liable to more than a limited term of imprisonment otherwise than by a jury verdict.
I submit that only in the last resort should jury trial be abolished after all other methods of reform have been tried and found wanting. I submit that at the very least we should await the outcome of the implementation of the various reforms Roskill recommends before taking any such highly controversial step. For my part, I have found most impressive the four
18
arguments which the Roskill report fairly sets out in paragraph 8.9 of the report, all tending to support the status quo.
On the report's proposal to abolish the defendant's right of peremptory challenge of jurors and the prosecution's right to stand by for the Crown, I would prefer to await the outcome of the investigation by the Crown prosecution service of the use of challenges before coming to a conclusion on that matter. I have to confess that I myself only once used the right of peremptory challenge and that was at Carmarthen Assizes. It proved to be a grave error. The juror I challenged proved to be the next-door neighbour of my sister living in Llanelli. It took quite a long time to restore neighbourly relations, and it did me no good. My client was convicted of murder and, I regret to say, duly hanged. My experience does not point to the great merit of challenges.
I conclude by saying that clearly the Roskill report marks an important landmark in the prosecution system. It also points out in the summary at paragraph 4:
"In many instances the reforms we propose could easily be argued to be of benefit to a wider range of criminal cases."
Whether this is by way of warning or encouragement, I know not. Does that go to the abolition of the jury in a wider range of cases? We shall have to wait and see, my Lords.
I conclude by apologising again for taking so much time. If I continue I shall incur the reproach to counsel who apologised to Lord Chief Justice Cockburn for taking so much time:
"Time! You have exhausted time, and encroached upon eternity."
3.45 p.m.
Lord Wigoder: My Lords, in a debate of this nature it is an inevitable formality that I should begin, on behalf of my noble friends, by expressing our gratitude to the noble and learned Lord, Lord Roskill, the chairman of the committee, to its distinguished members and to its staff for the extremely lucid, wide-ranging, and helpful report which they have produced. On this occasion it is in fact not a formality, it is an expression of our deepest congratulations to the noble and learned Lord for a document which I certainly regard as one of the most constructive and profound reports on the criminal law that I have ever had the pleasure of reading. I believe that it will make a real contribution to the development of that law in the course of the next few years.
It is inevitable that among all the recommendations the ones that will attract the most attention from the general public and the media are those connected with juries. For some extraordinary reason one only has to mention juries to be quite sure that the public appetite is whetted. Perhaps therefore I may dispose at the beginning of my observations of the two principal recommendations that concern juries before going on to what I think are much more important matters in this document.
As to the proposal that the right of peremptory challenge by both the prosecution and the defence should be abolished, may I say that I have a certain amount of sympathy for that proposal? I have always thought it strange that the right of the prosecution and

19
the defence to seek to rig the jury is regarded in some strange way as being one of our fundamental human freedoms. I agree too with what the noble and learned Lord, Lord Elwyn-Jones, said, although I cannot boast anyone living in Llanelli who has a neighbour who has ever been on a jury. I have certainly no reason to believe that I have ever indulged in any peremptory challenge which has had the slightest effect on the verdict.
I add, as my final observation on this matter, that I am a little sceptical about the argument sometimes put forward which is really to the effect that if the defendant happens to be a white, 23-year old pregnant redhead, for some strange reason she is entitled to have on the jury a number of other white, 23-year old pregnant redheads. This seems to be a curious path down which to go, and I am not sure that it is an argument that should ever be allowed to start. There are of course arguments both ways, but it seems to me that a weighty case has been put forward in this report for the argument that trial by jury involves a trial by a genuinely random sample, and that no interfering with the randomness of the sample should be allowed by either side.
As to the other proposal that there should be certain cases in which there would be a fraud trials tribunal consisting of a judge and two lay members who are really expert in that particular field, I have some considerable doubts. We ought to consider first the extent of the problem. It is proposed in the report not that such a tribunal should sit in all long fraud trials, but only in a certain number of what are described as complex cases, and an attempt is made in the guidelines in the report to define those cases.
It is clear from the wording of the report that the complex fraud cases will be a comparatively small proportion of the long fraud trials that we know now. In Appendices J and K the figures show that in 1982 throughout the country there were some 23 long fraud trials and in 1983 some 38 such cases. There the figures end. In parenthesis, I find that a little odd because, ever since the Courts Act of the early 1970s, we have witnessed the steady departure from the courts of the court clerks who knew something about practice and procedure and the range of sentencing available and their replacement by a curious breed of civil servant who spends the whole time sitting in front of the judge compiling meaningless statistics. Why there should be a report in February 1986 in which the last available figures for a fairly elementary matter are those for 1983 is something that I must confess slightly puzzles me. However, that is by the way.
The effect of those figures even for 1983 is simply that it looks as though the number of complex cases of fraud that we are concerned with is well down into single figures per year. Unless I missed it in the report there is no real attempt to calculate how many cases might be involved. It is clearly a difficult calculation to be made. But I hazard a guess on the information that is available that we are being concerned in this proposal to remove the right of jury trial for perhaps some half a dozen cases a year. That is the first matter to be borne in mind.
There are then practical considerations that perhaps are not fully stressed in the report as to the likely
20
consequences of removing jury trial in that small number of cases. There is the point made by the noble and learned Lord, Lord Elwyn-Jones, that there is no evidence so far that juries are incapable of trying the complex case, and, indeed, there is no evidence that in such complex cases they reach wrong conclusions. It goes further than that. I believe it is the very existence of the jury as the potential tribunal that is the only real pressure upon the prosecution to try to simplify the case. If there is no jury, if it is known by the prosecution right from the beginning that there will be a judge and two chartered accountants, or whoever it may be—professional people of that sort—there will be no pressure at all to keep the case simple or clear. I add that the suggestion that in some way removing jury trial will shorten the proceedings is, I believe, a great misconception.
I chaired a tribunal for many years on which there were expert members sitting alongside me, who (as will the lay members in the proposed frauds tribunal) had the right to cross-examine every single witness in turn throughout the hearing, and they did. There is no question but that the proceedings will take much longer if there is a fraud tribunal of the sort envisaged in the report than if the matter is left to be tried by a jury. It is inevitable that a tribunal of this nature will take unto itself an inquisitorial procedure as it develops.
Those I believe are the principal practical arguments against replacing the jury in that small number of cases. When one considers what I can perhaps be forgiven for referring to as the constitutional brouhaha that will emerge once we start trying to debate whether jury trials should be abolished in a particular number of cases or not, whether it is the thin end of the wedge and so on and so forth, then we ought all to reflect that we are only concerned with about half a dozen cases a year. In the light of the practical considerations I respectfully suggest to the Government that perhaps it is simply not worth embarking on this proposal because of all the disturbance that will inevitably ensue.
There is one argument which I have not dealt with that is sometimes put forward and is indeed mentioned in the report by those who argue that it is necessary to replace the jury in this small number of cases. That is the argument that because the Director of Public Prosecutions knows that a jury will be trying the case, he will, if it is a complex case, in some way be discouraged from having an investigation or starting proceedings. I doubt very much whether that is accurate. I suspect that the reason proceedings are not brought in some very complex cases is that the resources for an investigation are wholly inadequate. It is the part of the report—a helpful part—about the increase in the resources for the investigation which I believe will solve that problem. Perhaps I may add, having been one myself at one time, that the curious system of having what was then a Board of Trade inspector and what is now a DTI inspector, a barrister and an accountant working totally independently, but simultaneously, with the police, investigating the same fraud is something which I believe is a great waste of resources. Co-operation between the two might usefully be improved.

21
I leave the interesting but, I believe, comparatively unimportant questions in this report of the jury issues. I come now to what I regard as by far the most important part of the report, the part that deals with the pre-trial inquiry or, as it is proposed it should be called, the preparatory hearing—the review of the case before it starts to get the issues and the evidence clear and everything properly in focus. I have no doubt that if that could be made effective it would be a tremendous contribution towards the shortening and the simplification of the trial of these long fraud cases.
The report does not underestimate the problems. It is right that none of us should do that. Such a procedure involves having a judge who is highly qualified in the trial of fraud cases. Not every judge is so qualified. It involves having the same judge to conduct the preliminary survey as will eventually conduct the trial. It involves having that judge at the time of the survey completely master of all the documents in the case. That means allowing that judge to be excused from his court duties for a week or two weeks or it may be a month before the case starts so that he can master those documents.
That, as the noble and learned Lord, the Lord Chancellor pointed out, involves resource implications of considerable importance. I was encourged to gather the inference from what the noble and learned Lord the Lord Chancellor said that, if it is essential to provide resources, they must be found. I shall not proceed further down that slippery slope in the light of the arguments that are taking place with the noble and learned Lord's department at this moment on another issue.
That is the position so far as the judge is concerned. It involves having at the preliminary examination, the preparatory hearing, prosecuting counsel who has mastered the documents and is capable of playing his part in a trial of this nature. It involves having leading counsel for the defence who will be the same leading counsel who attends both the preliminary hearing and the trial itself. The report mentioned one aspect of the problem but not the converse aspect. One aspect has been widely commented upon in recent years at the Bar and that is the difficulty of persuading leading counsel who is to appear in a case to come to the preliminary hearing. It means putting in a vast amount of work before the preliminary hearing. The fees that are being paid for that for the moment are pitifully inadequate. It is hardly surprising that in those circumstances leading counsel finds it better to do something else on the initial occasion.
There is also the converse position, which causes great difficulty: leading counsel who is going to be in the case may well come to the preliminary hearing and may then find two or three weeks later that he is not able to take part in the trial itself because he has other different and clashing commitments. Somehow, those problems have to be sorted out. I believe that if they can be sorted out it will be of enormous help to getting the issues clear before the case starts.
That leads me to the matter to which the noble and learned Lord, Lord Elwyn-Jones, referred—the question of whether it should be obligatory for the defence to be disclosed either at or shortly after the preliminary hearing. May I say first that I think that in an appropriate case most responsible defence counsel
22
will disclose their defence at the earliest possible moment. It is helpful to them. I think secondly that it is possible to argue that if the defence does not disclose its defence when it manifestly should have done so, or does not make the necessary admissions when they manifestly should have been made, it might be right to penalise the defendant or his counsel in terms of costs.
Where I find it difficult to go along with this report is in relation to the further suggestion that not only might there be a penalty in the way of costs but there might, as a matter of law, be consequences that would follow evidentially and that a jury might draw an adverse reaction to some matter relating to the defendant because of his failure to disclose his defence. The only part of this report, if I may say so, that I found not enitirely convincing in its manner and its argument was the passage that endeavoured to argue that one could have that system and still in no way be weakening the right of silence or the right of a person not to incriminate himself.
The Lord Chancellor: My Lords, I wonder whether the noble Lord will forgive me for a moment. I find it difficult to follow this argument in the light of the change, which I think was brought about in the reign of the noble and learned Lord who is sitting on the Front Bench of the Labour party, to insist on the disclosure of an alibi defence. It is easy enough to see why the noble Lord is saying that the prosecution must prove its case and, yes, right of silence and all that. However, we have already insisted, with certain safeguards, on the disclosure of an alibi defence. There must be many defences of that kind which can catch the prosecution off their guard and which surely ought to be disclosed.
Lord Wigoder: My Lords, I am grateful for that intervention. The thought had of course occurred to me when I was considering this matter. I think the situation is very different. I think the situation with an alibi is that the trial is very often a very short trial; the defendant very often produces witnesses of whom the prosecution have never heard; the case is over the same day or the same afternoon, and 24 hours later it is discovered on examination that the alibi is totally false or the alibi witnesses have long criminal records about which nobody knew. A fraud case, which by definition is the kind of case about which we are talking, will take days and days, if not weeks and weeks, and I do not believe that that consideration applies.
The last matter which I should like to suggest about the preparatory hearing is this. If it is to be effective, the judge who is presiding over it must have very real powers. Whether they are to be powers given to him by statute or powers in which he is exercising, in the clearest possible terms, his judicial authority, I mind not. However, I do believe that a judge should have the power at the preparatory stage to tell the prosecution, in one form or another, that particular defendants in long cases should not be proceeded against at all, particularly those right on the fringe who are sometimes brought in by the prosecution and who add nothing to the case one way or the other except several weeks of argument.
I believe that the judge should have the power to say that certain charges will not be brought, even though

23
they are on the indictment. That is because again there is a tendency by the prosecution to clutter up the indictment with a large number of unnecessary charges, when very often one or two representative charges will more than suffice. I think also that the judge, who I am assuming knows the case inside out by that time, should have the power to indicate to the prosecution that a certain number of the witnesses are totally unnecessary, as being entirely repetitive, or as adding nothing whatever to the nature of the case. I hope those matters will be considered. I believe that a preparatory review might be a very effective part of the new procedure for shortening fraud trial cases.
Like the noble and learned Lord, Lord Elwyn-Jones, I am also in danger of encroaching upon eternity and I should not want to do so. However, there is one other aspect of the report that I should like to discuss at length on another occasion. I think it is very important. That is the section that deals with our updating of the rules of evidence to enable documentary evidence in addition to be much more freely admissible. I believe this also will be a great step forward in simplifying our procedure.
I end as I began. I welcome the substance of this report. I believe it is a major contribution. I hope very much that in due course we shall look rather more carefully at some of the detailed recommendations in some of the not very glamorous parts of the report rather than concentrate our attention on one or two matters that happen to be of particular public interest.
4.7 p.m.
Lord Roskill: My Lords, perhaps I may first thank your Lordships for the most generous welcome which this report has had. I know my colleagues have been greatly touched by the warmth of the reception. If I may, I should like to add a special word of thanks to my noble and learned friend the Lord Chancellor for what he said on the last occasion when the matter was before the House, when a Government Statement was made, and for his very generous observations which he repeated a few moments ago.
Secondly, perhaps I may thank those without whose help this report could never have been produced, let alone produced so quickly. I refer in particular to those who have given us evidence, orally or in writing, or both. They have given my colleagues and me the benefit of their individual and collective experiences and opinions without reserve. Of course, that evidence varied enormously in its content. In the old phrase, "Quot homines tot sententiae". That was only to be expected. Our task as a committee was to evaluate that evidence as best we could, and that we have sought to do in the report.
Thirdly, on the occasion of the Government Statement to which I referred a moment ago the noble Lord, Lord Wigoder, was kind enough to say (and I hope I quote his words accurately) that he found the report "always highly readable". I am not sure whether or not there was a measure of surprise but the noble Lord looked directly at me as he said it. It is an almost unique experience for a judge ever to get credit for anything: it is especially delightful when the credit is undeserved. Many have contributed to this report, to its thinking and to its writing, most of all my
24
colleagues. However, the burden of assimilating and synthesising all the contributions which they made to that thinking and that writing, and making the report wholly readable, fell upon our secretary, Mr. Michael Farmer, of the Lord Chancellor's department. It is only right that I should give him the credit for that is where, in truth, it belongs.
In an interview which I gave on the radio not long after the report was published, I was asked—and the noble Lord, Lord Wigoder, obviously had the same point in mind a moment ago—if I were annoyed that all the emphasis, and indeed most of the criticism, had been directed to our proposal for a fraud trials tribunal in complex fraud cases. I answered that I certainly was no way annoyed, nor indeed was I surprised. But I was rather disappointed, for it seemed to me that some of our critics had tended to start at the end of the report instead of at the beginning. They had not worked from the beginning towards the end and they had not appreciated that the proposals, in which all my colleagues but one concurred—and please remember that they were unanimous on almost all the other proposals—were designed to follow in logical sequence from what we had said, chapter by chapter, in the earlier part of the report.
If I may be forgiven for quoting some words that we used as a summary at the beginning, they were:
"we have sought to produce a coherent and integrated set of proposals aimed at streamlining the procedures for dealing with fraud cases".
We added in the same paragraph that,
"substantial alteration of any of our proposals may do damage to the structure of the whole".
I venture to stress those words—and I hope that what I am about to say will not imperil the friendship of over a half a century with the noble and learned Lord, Lord Elwyn-Jones—because I was a little disturbed to hear him say on the occasion of the Statement that his party could not accept the proposals for the Fraud Trials Tribunal. A similar remark was made on behalf of his party in another place at the same time.
I confess that I was surprised and disappointed that those who claim to be the heirs of the great radical political tradition in this country should show themselves so opposed to radical change when radical change is needed. I was fascinated to hear my noble and learned friend the Lord Chancellor claiming for himself a greater adherence to radicalism than that which I would have expected to come from my noble and learned friend Lord Elwyn-Jones. If indeed we have turned one of my noble and learned friends into a conservative (with a small "c") and my noble and learned friend the Lord Chancellor into a radical, this report will have achieved something.
Before I go on may I deal with one point that was made a moment or two ago. It was about the acquittal rate. One of the bugbears of our work has been the difficulty of ever getting any accurate statistics. The noble Lord, Lord Wigoder, on the last occasion gently chided me with some figures on page 243 and I think that there was an oblique reference to them again today. All statistics are misleading and, with the wisdom of hindsight, I slightly regret that we put in that appendix in the form in which we did. The figures there are of all fraud cases however trivial and they

25
include twopenny ha'penny (if I may use the expression) credit card fraud cases where somebody goes to a London store, is arrested, he subsequently elects to go for trial and very often he pleads guilty before the Crown Court; and those figures of convictions include pleas of guilty and acquittals are only a very small minority of cases. But they have nothing whatever to do with complicated fraud cases for which it is almost impossible to get any accurate statistics.
Perhaps I may mention one other figure before I go on. The noble Lord, Lord Wigoder, suggested that there would only he half a dozen cases for a Fraud Trials Tribunal, if such there be, in the course of a year. One is tempted to say that it is almost anyone's guess what the right figure is, but I venture to think, with great respect to the noble Lord, that he has put his figure very much too low. There are a good many in the pipelines which, of course, do not appear in these rather out-of-date statistics. My own opinion, but it is only my own and I alone am responsible if it is wrong, is that the likely figure would be of the order of 20 to 30 a year. But I would not want to give any warranty on that figure.
When the fraud trials committee was set up, I think many thought that its work was going to be solely directed to the controversial question whether a jury trial was the proper mode of trial in these complex fraud trials. My noble and learned friend the Lord Chancellor had spoken in public about it; my noble and learned friend the Lord Chief Justice had made a long speech about it in Hong Kong, and indeed he in that speech came to a conclusion by no means dissimilar from that which the majority of us have reached in this report. The then chairman of the Law Commission expressed a similar view and others on different occasions had all raised the topic with a view not so much to propound a solution as to canvass an opinion upon what was becoming an increasingly serious problem.
However, as soon as we started work and the evidence started to pour in—and, my goodness! how it poured in—my colleagues and I realised that the question of the mode of trial was but one of a very much larger number of problems, and that it was no use starting at the end and dealing only with the mode of trial. We realised that we must start at the beginning, and that is what we have sought to do. We have made a series of proposals, starting with the investigation and prosecution, continuing through committal, preparations of trial, the rules of evidence, and then at the end, and only at the end, we consider the mode of trial in connection with what we had said earlier.
It is a sad and regrettable fact that at each stage in our investigation we have weighed the present situation in the balance and at each step we have found it sadly wanting. Hence our sad but unanimous conclusion as to the unhappy state of affairs to which the report makes reference. I was particularly interested in the views of those of my colleagues who were not lawyers. Some of them had, of course, in one capacity or another some past experience of the legal process but none of the non-lawyers among them had had any experience of the detail of the process of the criminal law. I well recall one of my colleagues at one
26
of our meetings throwing up his hands in horror and saying, "No business run like this could last for five minutes".
It cannot be too strongly emphasised that the criminal law comes into play in these cases when, and only when, regulation, whether self-regulation or statutory regulation, has failed. It is the last resort. Your Lordships in a few minutes will be hearing a maiden speech from my noble and learned friend Lord Griffiths. Perhaps in those circumstances a cricketing analogy is not out of place. The criminal law is but a longstop against some very fast bowling which has succeeded in getting past the wicket keeper when it ought never to have done so. The criminal law has often been called a blunt instrument. Whether that is generally true is irrelevant. What is all too relevant and all too true is that it has in recent years proved deplorably blunt in dealing with fraudsters.
If the criminal law is to achieve its purpose in this field it must be swift, it must be effective, it must be certain in its application and, above all, it must act as a deterrent of fraud while of course ensuring that the innocent do not suffer. It must ensure that the guilty do not escape, and do not escape either because they are not prosecuted at all as the evidence for some techical reason is inadmissible, or because they cannot be got to this country, or because of the failure of justice on the part of the tribunal which has to determine questions of guilt or innocence when that tribunal has not fully comprehended the intricacies and cunning underlying many of these frauds.
I do not believe that the vast majority of people in this country who have not in recent times experienced and struggled to understand these intricacies and cunning have any idea of their complexity; complexity which can all too easily confuse, and may well all too easily confuse, and sometimes defeat judges, practitioners, accountants, as well as those who are from time to time, to their misfortune, called to sit on juries in these cases. Lawyers are often, and sometimes I am afraid not without justice, accused of complacency, of complacent resistance to change. They sometimes appear to adhere rigidly to Gilbert's words that the law is the true embodiment of everything that is excellent. But, having served on this committee with my colleagues, I believe now that only the most enthusiastic and myopic lawyer could say that of the present situation in relation to complex fraud cases.
With all respect to those who have said in evidence to us, and who may say again later in this debate, that in the end it is always a question of honesty or dishonesty and that issue is best decided by a jury, that is far too simplistic a view. In almost all serious fraud cases the first question is: what were the transactions of which complaint is sought to be made? The second question, which you will only attempt to answer when you have really understood and answered the first, is: were those transactions fraudulent or not? And the third, which again you can only attempt to answer when you have answered properly the first two questions, is: was the particular defendant a party to that fraud? Unless you really understand what the transactions in question are you can never begin to hope to get the right answers to the next two questions.

27
Special skills are required to achieve that understanding. We have special skills in tribunals charged to deal with other problems. It is not perhaps without significance that since our report was published it has been announced that efforts are being made to streamline the procedure of the Commercial Court because of the greatly increased complexity of the work in that court, which is often involved in the civil side of problems arising from serious commercial fraud. If we have other special tribunals with special skills, why is it wrong to have special criminal tribunals to deal with the special field of complex fraud? May I make the point in passing, that if there is a resource problem here, more than enough money would be saved by shortening the length of those fraud trials and stopping the amount of money spent on DTI inquiries to provide for any number of judges and adequate remuneration for those who are involved in future preparatory hearings.
We have been criticised because it has been said we have ignored the weight of legal professional opinion against change. If one judges this question by numbers only and one treats the Criminal Bar Association or the Law Society as representing all barristers practising in criminal courts, or the Law Society as representing solicitors similarly engaged, no doubt on a count of numbers only the point can be made. We most certainly have not ignored their opinion, which all of us greatly respect; but cases are not to be decided in favour of one party who calls 20 witnesses as against another party who calls only two. Much as one respects the views of those who disagree with us, there has been a considerable body of highly experienced opinion the other way and it has been our task to evaluate all the evidence which has been put before us.
It is not, I hope, out of place to add this. I have, of course, had a lot of letters since the publication of the report. Curiously enough, not one single one of them has been critical, but two—and I will not name their authors—interested me in particular. One was from a partner in one of the best-known firms of City solicitors who have been involved in what I might call the civil or aftermath side of many of these commercial frauds. The other is an immensely experienced criminal solicitor who has acted (usually for defendants, and I suspect sometimes far too successfully) in many of these cases. Each has said in effect, "Thank goodness you have grasped this nettle in spite of professional opposition." One went so far as to say that he greatly feared that further continuous opposition from the legal profession might end by damaging that profession rather than achieving anything else, when so many outside the legal profession have supported our proposals.
It is a commonplace that crimes of all kinds have vastly increased. In the welter of violence of which we read daily, another shocking increase has tended to be overlooked. Like my noble and learned friend Lord Elwyn-Jones, I know not the reason for this increase any more than anyone else. That shocking increase has tended to be overlooked, though there have been plenty of voices crying aloud in this particular wilderness against fraud and its growth and the apparent inability of the legal system to contain it. It has been our task as a committee to listen to these
28
voices—something which too many have hitherto not been willing to do—and, having listened to the voices, to try to grapple with this increase. If we grapple successfully there is still time to undo the damage which has already been done; but if we do not grapple with this increase the damage will increase further and markets which for centuries in this country have depended on integrity for their success are in grave danger of disintegration. The only losers will be this country, those who invest here and those who work in our markets— and, heaven knows, we cannot afford still more unemployment.
The small investor must always be protected: at present he is not. Markets must be cleansed of corruption. No doubt some of our proposals are readily susceptible of improvement. I do not doubt that, if and when there is legislation, they will be improved. We claim no monopoly of wisdom, but each one of us has lived with this problem for more than 18 months, and I venture to commend to this House a group of proposals which result from that work which we offer as what we regard as the best solution to problems of increasingly frightening dimensions. With the increase in technology and the resultant ability to move and launder vast sums of money around the world without leaving traces, it is no exaggeration to say that unless drastic action is taken now those frightening dimensions will become even more frightening all too quickly.
My Lords, I have not sought to answer all the detailed points which will arise on the occasion of legislation, but I would venture to say in conclusion that nothing is further from our minds than to alter the onus of proof or to propose a wider extension of trial otherwise than by jury than in a small number of fraud cases. When we said that some of our proposals might usefully be extended to other branches of the law, all we had in mind were things like the rules of evidence, because some of us felt (though it was outside our terms of reference) that it was quite absurd that we should have one set of rules for complex fraud cases and another, say, for complex drug cases or the like. I have again encroached upon eternity. I am sorry; but there are the proposals and I humbly commend them to your Lordships' House as the result of the working of our committee over the last year and a half.
4.26 p.m.
Lord Griffiths: My Lords, I well remember the day, many years ago, when as a very anxious young member of the Bar I faced the ordeal of first appearing before the Appellate Committee of your Lordships' House. I was heard with tolerance, sympathy and indulgence: I did not deserve it. Today, equally anxious and equally undeserving, I can only hope that your Lordships will extend to me that same benevolent tolerance.
I am very grateful indeed to my noble and learned friend Lord Roskill, to my noble friend Lord Benson and their colleagues for the clarity with which the arguments are stated in this very important report, and for the courage with which they have stated their conclusions. Certainly they cannot be accused of not grasping the nettle—perhaps I should say "the bed of nettles".

29
I hope that my contribution will recognise that the span of eternity is no more than 10 minutes and for that purpose I propose to address myself, drawing on my experience, to the more practical aspects of fraud trials and the impact of the recommendations in this report. I will leave conceptual and constitutional considerations for those better qualified than I to consider.
I should like first to deal with the question of delay. The report has identified and exposed the scandalous delay that all too often takes place between the time when the stench of fraud and corruption first assails the public nostrils and the time when the fraudsman can finally be brought to trial. When analysed, the causes are as follows: first, an ineffective initial investigation caused by a lack of resources and trained personnel, too often overlooked by a massive inquiry under the Companies Act by inspectors appointed by the Department of Trade and Industry, which drags on for something over three years. Thereafter there is further consideration of those papers and further investigations, followed by committal proceedings in which, if the fraudsman is properly advised, he will insist on an old style committal so that the delay can be further prolonged and the fog of war can begin to emerge. Thereafter there is a further prolonged delay before a date can be fixed to try the case, which will now take months and will require a particularly skilled judge to handle it.
The result of this lamentable delay, which your Lordships must appreciate will run into five years and more, is threefold. First, it hands to the counsel on behalf of the fraudsman an invaluable weapon in cross-examination: "How can you remember this event seven years ago of which you speak? Tell me, Sir, where did you go for a holiday? What did you buy your wife for her birthday seven years ago?" Of course the questions cannot be answered and much play is made.
Next—and this is of fundamental importance—many prosecutions, because of this factor, never see the light of day at all. It must be appreciated that those responsible for mounting prosecutions have only a limited amount of resources at their disposal and they are bound to weigh the prospects of a successful outcome to the prosecution against the enormous expense involved in mounting it and the deployment of resources. Everybody knows that very stale cases are difficult to get home and, because of the very staleness of the papers, a decision is taken that the chances of success do not justify bringing a prosecution.
I am quite satisfied that if the recommendations contained in this report, relating to the formation of a properly integrated prosecution service, the abandonment of these vast Department of Trade inquiries, the curtailment of any committal proceedings and a proper grasp of the matter at an early stage by the trial judge, are followed, it will drastically curtail this period of delay.
That will have two results. First, counsel will be deprived of this powerful cross-examination weapon, but, secondly—and let this be appreciated—for a time at least, until the message gets home to the fraudsmen that the game is not worth a candle, there will be a significantly greater number of prosecutions in very complex frauds and, in my view, about time, too.
30
Secondly, there is the question of our antiquated rules of evidence. Every day in daily life we are acting upon copies of documents which we have no reason to believe differ from the originals. Every day we are accepting the contents of documents as prima facie representing the truth. Why should it not be so in a prosecution? I have had experience of a case in which it was manifest that a monstrous fraud had been perpetrated on the public, but, quite deliberately, the money had been spirited abroad and passed through a whole series of companies in Liechtenstein in Belgium, in Luxembourg—I know not where.
There could be no question about the guilt. We had all the copy documents. But we had to abandon the prosecution because we could not obtain the cooperation of witnesses from abroad which was necessary to prove the originals, and those guilty men are still at large and enjoying huge sums of the public's money. So I welcome those proposals and, furthermore, I see no reason whatever why very serious consideration should not be given to applying them in cases other than fraud. They are sorely needed.
I know that I am not to be controversial and I come now to the question of the mode of trial. Peremptory challenge is not hallowed by ancient usage. In my days at the Bar I hardly ever came across it at all, despite the fact that when I was practising there were seven peremptory challenges. You could have caused havoc in almost any trial, but the peremptory challenge just was not used. It is, in fact, a modern innovation. I do not blame counsel for using it. If I were defending in a complex fraud case and I thought little of my defence, I would think it was in my client's interest to get the bank manager and the accountant, as I perceived them, off the jury. But it does not advance the cause of justice and I am wholeheartedly in favour of its abolition. The pity is that we did not have the courage to abolish the challenge entirely when we reduced it so recently from seven to three.
As to the form of the tribunal itself, I am of course very sympathetic to those who are anxious about this proposal. Any lawyer and, I think, any informed laymen instinctively recoils against the suggestion that trial by jury should be curtailed. But after anxious consideration, I have come to the conclusion that in very complex cases it is the right answer to have the fraud tribunal proposed.
I ask myself this question: What is the imposition that we are placing on our fellow citizens when we require them to sit as jurymen and women in these incredibly complex cases? We require them to take an oath or make an affirmation to return a true verdict according to the evidence. What right have we to expect them to undertake that task, when we have made no attempt to assess their capacity to understand the mass of complex evidence or given them any training to enable them to do so?
It is recognised as a fact that many judges are not capable of handling these cases. It is recognised that many counsel are not capable. What right have we to suppose that 12 men and women drawn at random are capable? They are not. At the end of the day, either they slavishly follow the judge's summing-up—which is not, in my view, a satisfactory state of affairs—or they follow the, perhaps, two or three members of the jury who have the training and capacity to understand.

31
Or, if they are honest, they just ought to throw up their hands and say, "As I have not understood it, I have got to acquit him." I cannot believe that this is a satisfactory state of affairs and I cannot believe, if in the very limited number of cases we adopt the solution proposed, that we shall endanger the value of trial by jury in our society.
Finally—and this is my one reservation—I would like it to be a unanimous decision of the full tribunal. There are three persons concerned. The suggestion is that it should be a majority decision. If one out of three trained and skilled persons is not sure of guilt, then can we say that the accused is guilty beyond all reasonable doubt? I would rather that it was a unanimous decision.
4.40 p.m.
Lord Campbell of Alloway: My Lords, noble Lords on all sides of the House would wish to acknowledge the rare quality of that excellent and authoritative maiden speech of the noble and learned Lord, Lord Griffiths; and to congratulate him upon his grace of timing and manner of execution with that light, discursive touch. To be allowed to convey this customary valedictory message to a friend of such long-standing is indeed a very special privilege. No doubt your Lordships would wish that the noble and learned Lord should not ensconce himself in his learned duties but that he should continue to share the benefit of his expertise in discussion and debate on many future occasions.
In following the noble and learned Lord, I for one defer to his experience, both at the Bar and on the Bench, when he spoke of the problems of complex fraud crimes, of the inhibitions that prevent prosecutions, and of his criticisms of the antiquated rules of evidence. As the noble and learned Lord, Lord Elwyn-Jones, has said, this is indeed a timely report. The hope is that the Government shall accept the broad drift of reform and innovation proposed, which would enhance the quality of justice; and that the Government shall introduce implementing legislation without delay.
If such be the intention then it is indeed fortuitous that we should debate this report in the immediate wake of a surge of militancy on the part of some of those without whose co-operation the report's recommendations may not be implemented. Fortuitous because, as a by-product of the recommendations to save time contained in the report, there will be substantial savings in public expenditure; and that affords an honourable and realistic means of resolving the current dispute that will also aid the urgent implernentation of the report. Such anticipated savings may be laid as a tribute on the altar of escalating costs of civil and criminal legal aid, to appease the displeasure of those gods in the Treasury.
Irrespective of the threat of pending proceedings or withdrawal of services, upon which it is not proper to comment. acceptance of the report ordains—no more, no less—that the Government should reopen negotiations on adequate remuneration, affirmed in paragraph 6.46 of the report, and so fulfil legitimate expectations in this regard—and thus sweep the stalemate from the Exchequer board.
32
In such negotiations, new norms borrowed from the consequences of Government acceptance of the report could serve the irenic spirit of compromise; in particular, that the level of fees shall ensure that people with the higher degree of competence envisaged—and I take just three passages in the report—in paragraphs 9.38, 9.42, and 9.45 to 9.50 shall be attracted into becoming and remaining members of the criminal Bar. The second norm is that the savings in public expenditure should benefit not only the Government as the monopoly employer/paymaster but also the practitioners—both branches of the profession—in terms of pay increments for their services.
In any event, consultation between the Government and the Bar must ensue, as many of the recommendations propose to establish new duties, new disciplines and new sanctions of general application in the conduct of criminal cases—some of which could lead to disciplinary action before the Bar Council. I refer in particular to paragraphs 6.55 and 6.39 of the report. Incidentally, those are matters that attracted the attention of the noble Lord, Lord Wigoder.
If the Government intend to endorse such recommendations—which call for new duties, new disciplines and new sanctions—and introduce a Bill as a matter of urgency, then there is no time to be lost. Consideration will have to be given, for example, as to whether such recommendations should, with the agreement of the Bar Council, be incorporated in a voluntary code of practice having no legal effect. If some such consultation is inevitable, then surely it would be unrealistic to suppose that that area of consultation would not be enlarged to cover remuneration, with a view to establishing a voluntary code of practice, by agreement, in that regard also.
It cannot be—it must not be—that implementation of the valuable proposals contained in the report should be frustrated or delayed by overt strife with the Bar, in which my noble and learned friend the Lord Chancellor is inevitably involved. Irrespective of the merits—with which your Lordships are not concerned —this situation is one that may only be resolved by patience, restraint and continuing negotiations. It is a hatchet that must be buried, and buried soon.
In all this, fair credence ought to be given to the fact that, whatever may be the warmth of personal sympathy, my noble and learned friend the Lord Chancellor speaks for the Government and, as such, is subject to financial constraints. So indeed are the Law Officers, who are responsible for prosecution fees, subject to financial restraints. My noble and learned friend's responsibility lies only with the defence side fees funded by legal aid, and the means of resolution lie within the province of Government, not within the gift of my noble and learned friend.
As to the report, it is fortunate that the terms of reference should have been so widely interpreted that by logical extension many of the recommendations made in context with fraud trials should have a far more general application. The recommendation in chapter 8 as to trial by FTT of complex frauds (not the vast majority of fraud cases) must be seen in this perspective. As to this, I have only two qualifications. I share entirely the reservation of the noble and learned Lord, Lord Griffiths. The decision of the FTT should be unanimous. My other qualification is that

33
the appeal procedure under paragraph 8.59, from the judge who authorises trial by the tribunal instead of trial by jury, warrants revision.
Here the suggestion is that the Court of Appeal should be given jurisdiction to entertain such appeal. It should be enjoined to re-hear the original application on the merits without being bound in any way by the original decision. Why should this be requisite? It is because paragraph 8.2 recognises that what is a "complex fraud case" belies definition. The guidelines in the annexe at page 153 assuredly are too vague and imprecise to lay down any principle: and so, the original decision cannot easily be said to be wrong in principle. In that situation, according to settled practice, the Court of Appeal may not reverse the decision which involves the exercise of judicial discretion (even if it disagrees with it) because it cannot be shown that the judge erred in principle. So it is apparent that if there is to be any effective appeal a revision is requisite. Revision of the guidelines by the Court of Appeal, to which reference is made in paragraph 8.59, cannot alleviate this problem or remove the obstacles strewn in the thorny path of any such appeal.
The removal of the right to trial by jury in complex fraud cases is justified because the quality of justice, far from being diminished, will be positively enhanced. There will be safeguards against perverse convictions on trial by jury and extended safeguards against erroneous conviction at the hands of the tribunal which cannot obtain on a jury trial; for in a jury trial a perverse conviction in a complex fraud case through ignorance, want of understanding, want of special skills, inattention, prejudice, tedium, confusion, or sheer exhaustion, cannot be challenged if the summing up is correct in law and the facts are left to the jury.
On a trial by the tribunal the requirement at paragraphs 8.66 to 8.70 that the judge should give a reasoned judgment on both fact and law affords a substantial safeguard which does not obtain on trial by jury where no reasons are given by the jury and special verdicts are out of favour. But the reasoning of the judgment of the tribunal on fact will be open to challenge on new grounds, new safeguards: first of all, that there is no basis on which a finding of certitude on a primary fact could be supported and, secondly, that there is no basis on which a finding of certitude in drawing an inference from the primary fact could be supported; in which event, with either of those safeguards satisfied—which cannot obtain on jury trials—conviction would be quashed on appeal if unsafe.
In conclusion, it is much to the credit of my noble and learned friend the Lord Chancellor that he should have had the wisdom and foresight to envisage the need for such a report—I think it was as long ago as 1983—and to have appointed the noble and learned Lord, Lord Roskill, as chairman. Under his chairmanship the committee faced up to the need for fundamental change. It has grasped a very awkward nettle and in this, as all noble Lords who have spoken in the debate recognise, it has rendered a signal service.
4.57 p.m.
The Earl of Buchan: My Lords, I address your Lordships for the first time very conscious of the
34
universally high standard of speeches in your Lordships' House and it is your Lordships' indulgence that I shall need and request. In return I promise to remember the advice given to my grandfather many years ago by an eminent member of your Lordships' House: "Be brief, be quick, and for heaven's sake try to make sense".
At this point I should like to place on record the kindness and firm tolerance shown to those who have just arrived in your Lordships' House by those who work in this appropriately magnificent Chamber and round about it—the Clerks at the Table, doorkeepers and those who work off the west front corridor. At the mention there of a maiden speech guidance notes are thrust into one's hands. One is asked to note particularly the paragraph on controversial speeches. Be assured, my Lords, by the figure registered in the controversy meter in the roof—which records zero Celsius, nought centigrade and, to those who like myself prefer the older ways, 32 degrees Fahrenheit. I should like also to thank the noble Baroness, Lady Hylton-Foster, who gave me some advice on this controversial matter. She added at the end, "Of, course, there are two sides to every question,".
Now to the matter in hand, and not without some trepidation. A Q-ship with no legally qualified man in charge sails into an ocean of experts. I should like briefly to address your Lordships on three particular matters. I congratulate, as others have done, the noble and learned Lord, Lord Roskill, for this historic and notable report. My first point concerns committal proceedings, the second point relates to fraud and the City of London, and my third point, which is nearest to my heart, concerns trial by jury.
On the subject of the proposals to change committal proceedings, I speak only as a lay magistrate sitting in the City of Westminster. In fact, I enjoy old style committals, and not only because they are different from the business of awarding penalty points to drivers who have strayed into bus lanes. In common with the noble and learned Lord, Lord Elwyn-Jones, I wonder if both the new proposals, the interim procedure and the new transfer certificate, which are to be used at the discretion of the prosecuting authorities alone, in the cause of justice and speed—which are not necessarily synonymous—are right and consider properly all the interests of the defendants.
On the matter of serious fraud and the City of London, which are most definitely not synonymous, I have plied my trade there as a member of the Stock Exchange for many years now. That organisation has its own compensation fund to repay any member of the public who has suffered a loss through fraud by a member of the Stock Exchange. Thus it welcomes the proposals of this report, saying that its own disciplines are, of course, no alternative to state prosecutions, and it looks forward to the time when court procedures will be equal to the task of unravelling the complexities of financial fraud so that convictions can be obtained.
Now I come to the point where really strong feelings are aroused, which is the right to trial by jury and the recommendation to do away with it. The noble and learned Lord the Lord Chancellor has kindly referred to the fact that I descend from Thomas Erskine, Lord Chancellor in the Ministry of All Talents, who took as his motto "Trial by jury" and who obtained eminence

35
by his eloquence before juries. When addressing your Lordships' House shortly before the death of His Majesty King George III he used these words:
" 'Trial by jury' has preserved our most gracious Sovereign throughout a long and glorious reign. 'Trial by jury' is the best security for the rights of your Lordships, and of every order in the state".
Every man and woman can understand trial by jury. It has a ring to it. Trial by appropriately qualified lay member of a Fraud Trials Tribunal or assessor does not.
When I first read the noble and learned Lord's report, in defiance of the noble Lord, and much as the reader of a detective story should not, I meant to start at the end. I hoped to read about the right to trial by jury at around page 180. Chance took me ten pages on, where I found my own feelings on the subject so perfectly expressed that I drifted off into some mellow haze of "My sentiments precisely", "I could not have said it better myself" and "Why has no one ever said this before?"
Therefore, consider my utter dismay when I found that I had not picked the recommendations at all but the Note of Dissent by Mr. Merricks. Notwithstanding this, I must read out this short paragraph from the report:
"I do not think that the public would or should be satisfied with a criminal justice system where citizens stand at risk of imprisonment for lengthy periods following trials where the state admits that it cannot explain its evidence in terms commonly comprehensible".
Precisely, my Lords.
There it is. I have been greatly privileged to have been able to make my maiden speech before your Lordships on this report which has been referred to on an earlier occasion by the noble and learned Lord the Lord Chancellor as "readable, thorough and radical" and by the noble Lord, Lord Wigoder, as "constructive, stimulating and provocative". Your Lordships will be giving the fullest consideration to all the recommendations in the report. I hope that I shall not be thought presumptuous in hoping that specially powerful thoughts will be deployed on any proposals to diminish the defendant's right to trial by jury.
5.5 p.m.
Lord Silkin of Dulwich: My Lords, it is my great privilege and on this occasion my very great pleasure to be able to congratulate the noble Earl on his first speech in this House. He has made his points persuasively, with wit and briefly, and we certainly look forward to hearing him on many future occasions. The fact that I agree very strongly with much of what the noble Earl says perhaps influences me even more to award him those congratulations.
I must also congratulate the noble and learned Lord, Lord Roskill, and the noble Lord, Lord Benson, as well as other members of the Committee, on producing both an extremely readable and in many ways a persuasive report. Even if one disagreed with every recommendation the report would be of very great value, because it will enable Members of this House and others elsewhere to examine in detail the vital points that need to be considered in relation to fraud, and I am quite certain that such will be its effect.
36
Certainly I think we all wish to look with very great care at all the recommendations, perhaps even those for which we may begin by feeling sympathy, to see whether they will really stand up well to the investigation which ought to be made.
I hope that the investigation will not be confined wholly to lawyers. One of the matters on which I find myself able to congratulate the noble Earl is that he has the courage—I shall not say the temerity—to be one of a very small minority of laymen among a large number of distinguished lawyers who are taking part in this debate. In a way I think it is a pity that there are not more laymen who are doing so and giving us the benefit of their views.
Having congratulated the authors of the report, I should like finally to congratulate Mr. Merricks, the writer of what I at any rate, as does the noble Earl, think was an extremely persuasive Note of Dissent. I agree with much of what he says.
One could take up far too much time in going through detailed points one by one, but perhaps I may deal with just one or two of the points made. In doing so I should like to repeat that the recommendations need to be studied with very great care and if I do not deal with more than one or two it is not because I am not impressed by very many of them, both as they appear in the report and as the noble and learned Lord, Lord Roskill, reviewed them in this House.
I particularly support the concept which the report put forward that in these complex cases—and indeed this applies whether we are dealing with fraud or any other complex matter—there should be a prosecution team of the same leading counsel throughout, if that is possible and if the Lord Chancellor of the day does not deprive the Bar of his services too soon. I take as an example of that the series of cases known as the Poulson cases, where my predecessor as Attorney-General, the noble and learned Lord, Lord Rawlinson, set up precisely such a team. He headed it by two distinguished Queen's Counsel, both of whom, fortunately not until the case was over, went to the High Court Bench. In a case of that kind, that kind of organisation, with specialist police officers, specialist accountants, knowledgeable and able members of the DPP's department, in that particular case working always together with the Law Officers, was essential. I hope that that will be taken as the kind of approach about which the report is talking and which ought to be followed.
Secondly, I should like to say a word about the point that was particularly emphasised by the noble and learned Lord, Lord Griffiths, in his excellent speech relating to Department of Trade reports. I do not think that perhaps it is quite so simple as it has been made out to be. Department of Trade reports are very often required in order to satisfy a feeling among the public that they need to know more about, for example, the collapse of a group of companies.
From my experience, I can say that it certainly sometimes happens that from the Department of Trade report emerges the evidence of fraud. Of course if that happens, the period to which the noble and learned Lord, Lord Griffiths, referred may still obtain; but I sympathise very much with the view expressed in the report that so far as practicable the shorter

37
procedure under which the Department of Trade Inspectorate can act should be made use of rather than the longer.
In particular I think that it is most important that the departments concerned—the Department of Trade, the new Crown Prosecution Service and the Law Officers of course—those above them—should provide guidelines which will prevent the difficulty that often arose of conflict in the consideration of whether there should be a Department of Trade inquiry or not. It would be realised, that, if there is a Department of Trade inquiry going the full length of the two or three years that they often do—often because, being conducted by counsel, the hearings can only be at intervals rather than over a consecutive period—it becomes for a number of reasons extremely difficulty to prosecute after the inquiry, both because of the feeling that it may be unfair to those who have given their evidence under compulsion and also because of the length of time that has been taken in the process.
When I was Attorney-General—and I am sure that this applies to my predecessor and successor—one of the most difficult matters, for the very reasons I have given, was advising the Secretary of State for Trade whether to embark upon an inquiry. I hope that with the benefit of the Crown Prosecution Service in the future, the existence of which may help to resolve many of the problems illustrated in the report, that problem may also disappear.
Let me pass to two major matters—major in the sense that they are the sort of matters that the public is likely to consider to be of importance. The first is the question of challenges. I think that I would wholly agree with the first words of paragraph 7.29 of the report, where it is said:
"We have considerable sympathy with the exercise of the right of peremptory challenge in pursuit of an aim of securing a better racial or sexual balance on a jury".
Having said that, the report goes on to say that there is no sympathy with the exercise of that right simply for tactical reasons. No doubt we all agree with that. But surely the major difficulty is that if we abolish the right of challenge and the right to stand by, we are not only abolishing the exercise of that right for largely tactical reasons but we are also abolishing the right of peremptory challenge in pursuit of the aim of securing a better racial or sexual balance on the jury. We simply cannot have one without the other.
That is a point which it seems to me must be considered extremely carefully before effect is given to the proposal for the abolition of peremptory challenge—a proposal which, quite rightly, is accompanied by the proposal that it would be necessary also to abolish the right to stand by for the Crown, because there must be equality between the prosecution and the defence. Indeed, that was one of the great problems that I found that I had to try to resolve when it came to a subject that did not cause me much popularity—that is, what is called jury vetting. Necessarily it was the prosecution that obtained the information that led to certain people being taken off the jury. I did my best in the guidelines to ensure that any material that the prosecution discovered which it was felt would be of value to the defence or which the defence ought to know about in relation to the right to
38
challenge should be passed to the defence. That was the nearest that one could get to equality in that sense. But of course all that would disappear if these proposals go. The House ought to address itself carefully to the question of whether that will not leave a hole which the right to challenge for cause will be inadequate to fill.
Having said that, let me come to the issue which certainly has raised and is likely to raise the greatest amount of controversy, that of mode of trial. Of course there are many highly complex cases which are not necessarily cases of fraud. It may well be that whatever decision is ultimately made on the question of fraud in highly complex cases will be passed over to other complex cases; indeed, perhaps cases which are not cases of fraud technically in the sense that fraud is charged but where fraud is an element in the case of some other charge.
There I must say that I am very much impressed in particular by what Mr. Merricks says. The report gives four reasons put forward for keeping a jury and dismisses them, I think rather too lightly. But it does not put forward what I regard as the most important point, which is perhaps summarised in C11 of Mr. Merrick's note of dissent; that is to say:
The constitutional argument put … amongst others, by Lord Devlin that the right to jury trial has become so much of an institution that it has become more or less a convention of the constitution that citizens should not be liable to more than a limited term of imprisonment otherwise than on a jury verdict".
That has become so much a convention of the constitution that, as Mr. Merricks says in C5, the people who are closest to the existing system, including the vast majority of the police, the legal profession, the magistrates and so on, were overwhelmingly in favour of retaining the jury. It is not an answer to say that we shall adopt an alternative procedure in only a very few cases. We were compelled to adopt it in the quite exceptional circumstances of terrorism in Northern Ireland. That was for a totally different reason to those advanced in this case. It was because of the danger to individual jurors and the real possibility that you simply would not get verdicts from juries which were mixed so far as religion was concerned. Those circumstances do not apply here. It is stated that juries would not be able to understand. Before we dismiss the jury system on that basis, it seems to me that one should be looking, as indeed the report did, at other alternatives, regarding this particular alternative as literally the last one to adopt if one found that there was simply no other alternative.
I hope that many of the earlier parts of the report will result in improvements in procedure which will make fraud trials much simpler for people to understand. If that happens the problem may disappear. One possibility that struck me as a recommendation when I read the report has not been dealt with. I wonder whether it is not one to which attention should be directed. The proposal is that there should be a tribunal consisting of a judge and two expert lay assessors and that the majority verdict should be accepted. There are those who suggest that this is wrong. But assuming that it is the view that is adopted, it shows perhaps one of the major reasons why those consulted want overwhelmingly to keep the jury system. With a jury, it is still the law that a decision has to be either unanimous or approved now

39
by at least ten to two. Here, a decision of guilt could be by two to one. That seems to me to be highly undesirable and a position that would not easily be accepted by the community at large.
However, the two sitting in addition to the judge are to he experts who will be able to give to the case and to the judge their own expertise. They will be people familiar with the type of case that is before the court. There are likely to be no judges who will not be grateful for the expertise and the knowledge that will be given to the judge. But, if that be so, is there any good reason why the same sort of expertise should not be available to the jury? Is there any reason why the jury should not have an opportunity during a complex case of this kind to consult expert assessors with particular knowledge of whatever the issue may be—the Stock Exchange or other area of finance—and who would be able to keep them abreast of the meaning of different parts of the case which otherwise they would probably be unable to comprehend?
There may be all kinds of reason why that would not be practicable. It is a pity that the report does not look at a suggestion that would involve keeping a jury with the benefit of that assistance so that at least we could see on paper what are the arguments that make that proposal impracticable. I advance it because I feel strongly, as I said earlier, that it is only in the very last resort, in the sort of situation with which we have been faced in relation to the emergency in Northern Ireland, that I would be content to see abolished an institution that peole regard as a safeguard both because it has existed for as long as it has and also because they know that if they are found guilty this can only be by a verdict of at least ten out of 12 laymen.
For that reason, I advance the suggestion as a possible compromise between points of view, but one that should at least be studied before the jury is accepted as being suitable for abolition in complex fraud cases and possibly other complex cases. I hope that those who give consideration to this matter will not lightly accept the view that juries should be abolished if there is any alternative way of dealing with the problem.
5.26 p.m.
Lord Benson: My Lords, I was a member of the Roskill Committee, and I am grateful to the House for allowing me to speak on this subject. I hope that the House will forgive me for speaking with conviction in support of its recommendations. The broad sweep of the report has been covered already by our chairman, the noble and learned Lord, Lord Roskill. In brief, it proposes radical changes in the criminal procedures for fraud cases from the time of discovery until the verdict. The present procedures are long out of date. I suspect that similar changes are also necessary in the civil procedures.
I should like to speak this afternoon on one subject only, and that is the question of jury trials in complex fraud cases. I start with this provocative observation that there is no argument, no factor, in favour of jury trials in complex fraud cases that can possibly stand up to the dictates of common sense. Every year in this country 3 million people come before a tribunal of
40
one sort or another. It may be the magistrates, the Crown Court, the High Court or the numerous tribunals that have been set up in the past 30 years.
In every single case the members of the tribunal chosen to hear those cases are carefully selected and hand picked. Their cross-references are taken up. The object of doing that is to select people with three qualities that all of them are believed to have—integrity, competence to do the job, and power to comprehend the issues at stake. Every year, 30,000 people come before a jury of one sort or another. For that purpose we choose 12 people at random. The method of selection virtually guarantees that not one of the 12 will have all the three qualities that are chosen in the other cases. I ask you, my Lords, whether that stands up to common sense?
Not many people really understand what a complex fraud case involves. I want to give two examples in order to get the matter into the right perspective. We had evidence from one prosecuting authority that at the time of writing, the exhibits—they were not by any means complete—were 30 feet high, which is well above the height of the clock behind me, and the authority had the grace to say that there was no one left in the department who could understand the evidence.
Perhaps another more practical example might be this, and I speak from practical experience. It would comprise over 100 witnesses, many of them of doubtful probity. There would be 5,000 exhibits chosen from many thousands more. There would be 50 or 60 banking accounts paid all over the world in different currencies. Many of the records could not be seen. They would be computer records and marks on discs. There would be a network of 50 or 60 companies spread round the world locking or interlocking in a way which it is almost impossible to discover. There would be six or seven accused with varying degrees of guilt or innocence. There would be six leading silks, each placing a different interpretation on the evidence of the oral witnesses and the documents which are put forward as exhibits. The trial would last from 30, 40 or 50 days—the longest we have had on record so far on the evidence is 137 days. I speak from practical experience. It sometimes takes me a week, with skilled back-up staff, to trace through one single transaction to see what has really happened.
What sort of persons do we choose to try these cases? They are supposed to be 12 persons chosen at random from society. Great slices of our population are not competent and are not allowed to sit on jury trials: the armed services, lawyers, the medical profession, clergymen, and others. But then there are two other groups: the self-employed persons and those who are currently engaged on day-to-day complex and difficult matters. They are always in practice excused from jury trials in long cases because they cannot get away from their businesses though they might very well be competent in other respects.
What then of the rump that is left? There is no requirement that a juror should be able to read or write; and we have evidence before the committee that jurors are sworn who can do neither. Many of them, we had evidence, had limited command of the English tongue and they sit for 20 or 30 days grappling with the English tongue and quite unable to comprehend the

41
facts of the case. In a great many cases jurors have no banking accounts so that they do not even know, probably, the difference between a debit and a credit. Can it seriously be suggested that men chosen in that way are capable of comprehending and arriving at a sensible solution in the type of fraud case that I have described?
I say this to your Lordships: that justice is not being done. It is positively and affirmatively not being done. The evidence on this was clear: that a great many frauds are discovered but many of the more serious cases are not brought to trial. The major contributory cause was that there is no possibility of getting the jury to comprehend the issue. In other cases we were told—the evidence again is clear—that only minor charges are preferred because the jury would never understand the facts and the complexities of the charges which ought to be preferred. The result of this is that fraudsters are running free instead of serving long sentences behind prison bars.
I ask your Lordships to listen to just one sentence, the written evidence of the Inland Revenue. I beg your Lordships to observe what it says rather closely:
"Some prosecutions that ought in principle to be brought can never effectively be brought as long as trial by jury is the only method available".
That is the opinion of one of the most competent and efficient prosecuting authorities in the country. There are 46 other prosecuting authorities, many of whom have nothing like the skill and the competence of the Inland Revenue department. If that is the opinion of the Inland Revenue department, how bad must it be in the country as a whole?
No responsible government, no society which believes in law and order, can tolerate this situation. Many long years ago a cry was uttered in this Chamber which is very apt to this occasion. It was said quite simply, "I call upon the honour of your Lordships to save us from this pollution". Those who cling to belief in the dogma of jury trials in serious fraud cases will have to answer that challenge.
It will be said that one of the reasons for chosing 12 persons at random—the sort of random selection to which I have referred—to hear serious fraud cases is that they know the difference between honesty and dishonesty. Nothing could be further from the truth. We have been administering justice in this country for centuries. But up to this point of time there is no definition in the statutes of what honesty or dishonesty means. There have been numerous judicial decisions, mostly conflicting, but the latest one which prevails—of only two or three years ago—still leaves the matter in confusion. This is all set out in Chapter 3 of the report. If the judiciary are unable to decide what is honest or dishonest, how much more difficult must it be for 12 persons chosen at random, and particularly so when they have not even been able to comprehend the evidence.
While we were sitting on one occasion a judge came to us hotfoot from the Old Bailey. He had just been sitting on a fraud case lasting 20 days. At the end of this, the jury came back from the jury room on two occasions and asked his Lordship to explain what honesty and dishonesty meant, which he did with
42
painstaking care on both occasions. They were still in a muddle and eventually they compromised at six-all and the trial was aborted.
One essential and vital characteristic of justice is that it should be frank and open. We abandon this basic principle in jury trials in complex fraud cases. In most serious crime the decision is usually fairly black or white. Did the accused stick a knife into the other man or did he not. Did the man rape the woman? Did the accused break into the premises? These are not the issues in a complex fraud case. First, it is necessary to decide whether the financial statutes have been breached—and they are complex enough in any case. Have accounting standards been ignored? What then is the custom of the market? And the custom of the market in these cases is extremely complex, has never been written down, and is very difficult to discern.
Then it is necessary to trace over a long series of transactions, through company after company in different parts of the world, how, when and where the fraud took place, because very often these transactions start in an innocent way. Finally one has to decide with regard to each of the accused in the box as to when the intent to deceive first arose and to which of them it applied and precisely when.
In practice all these complex decisions are decided in secret in the jury room and we do not know the reasons. The City is becoming exasperated by seeing fraudsters salting away millions of pounds either at home or abroad, causing big losses which fall on the creditors and lead to unemployment; yet if and when they are brought to trial decisions are made to acquit, no reasons are given, and nobody can understand why. I suggest that this is a situation that also cannot be tolerated. It does not amount to justice; it amounts to a lottery.
One of the big advantages of the recomendations of the committee's report is that the tribunal, we suggest, should have to give the reasons for the decisions they come to. They should have to give the reasons in writing, and those reasons, and the facts which they set down, should be subject to appeal. Then, and then only, shall we get justice in these complex cases.
Time is against me. There is a great deal of argumentation that I should like to put before your Lordships of a similar character to that which I have already mentioned. However, I wish to finish on one note only. The great bulk of the people who clung obstinately to the idea of jury trials in these complex cases showed a curious hesitation in most of their evidence. That was most noticeable. Again and again, having pronounced firmly in favour of jury trials, they put forward an alternative plea and suggested that perhaps the jury trial procedure could be improved.
A large number of recommendations were made which amounted to some kind of special jury. For example, one revolutionary suggestion was that jurors must read and write. Others thought that "O" levels would be adequate and some thought that jurors should have "A" levels. Others put forward that jurors should even have university degrees. Some thought that there should be a single judge, while others thought that there should be three judges. One suggestion was that the judge should retire with the jury to arrive at the conclusion.

43
We examined all those proposals with care. Some of them did not seem to be very practicable. We eventually concluded and put before your Lordships for consideration that the best solution was three people with appropriate skills; that is to say, a competent judge and two others—laymen—all of whom had three vital qualities: integrity, competence to do the job, and power to comprehend the issues at stake.
5.41 p.m.
Lord Hutchinson of Lullington: My Lords, I should like to begin by saying how much I enjoyed the speech of the noble and learned Lord, Lord Griffiths. I noticed a hint of controversy from him, as I might have expected—on the Buchan scale I should say that it was about five in a 100. I heard him say that he had no memory of the peremptory challenge. I know that judges go very quickly into their ivory towers, but I did not know that the judicial memory was quite as short as that. The speech of the noble Earl was like a breath of fresh air in the heavy vocabulary of the law, and I enjoyed that too. I only wish that his ancestor—Erskine—was here for this debate because I am quite sure that he would be on my side as regards some of the more controversial matters to which I intend to refer.
I am glad to say that with very few reservations I can welcome wholeheartedly the procedural changes recommended in Chapters 2, 4, 6, 9 and 10 of the report. Indeed, I would bless the majority of the 112 recommendations. That is not surprising—although it may be surprising to the noble Baroness, Lady Phillips—because many of the recommendations and ideas which are pursued stem directly from the 65-page document which I am holding in my hand and which was issued by the Criminal Bar Association as long ago as 1980, a copy of which has since then been lying gathering dust in the department of the noble and learned Lord the Lord Chancellor.
The Lord Chancellor: My Lords, perhaps I may interrupt my noble friend. He must know that the noble and learned Lord the Lord Chancellor is not responsible for the criminal law and procedure: the Home Secretary is responsible. Wherever else that document has been gathering dust, it has not been doing so in my department.
Lord Hutchinson of Lullington: My Lords, if I may say so with the greatest respect, the recommendations were directed to improving and accelerating the procedures in the courts for which my noble and learned friend the Lord Chancellor is responsible.
The Lord Chancellor: My Lords, I am sorry to interrupt again but the procedures in those courts are Home Office responsibilities and not the responsibility of the Lord Chancellor. My noble friend may not believe it, but that is the truth and there are at least two persons who have held that office who know it to be true. My noble friend really must get his A, B and C of constitutional responsibility right.
Lord Hutchinson of Lullington: My Lords, one understands where the dust came from. As regards Chapters 5, 7 and 8 of the report, I am afraid that I must introduce a discordant note. I found those chapters disappointing and at times even deplorable. I found the language tendentious and the argument very anecdotal. There is much special pleading and rhetoric abounds. The main characteristic of those chapters is their deafening silence as to the nature of the evidence which the committee received. In the argument—which mostly descends into advocacy—there is no attempt to summarise, analyse, or to assess the evidence, in spite of our having heard today from the noble and learned chairman that the committee evaluated the evidence.
From the first request for evidence we see how the committee saw its task. It said that it saw as its principle task the review of the present system of jury trial in the light of the evidence it expected to receive. Although that was the committee's view, at paragraph 1.3 the report says:
"It soon became evident, from the volume of evidence we received, that …[the] main criticisms … related to the administrative and legal procedures presently in force".
In other words, there was little criticism of trial by jury, but much criticism of the preparation and presentation of the evidence for the jury.
I hold the noble and learned chairman in great admiration and affection and, if I may say so, I know him well enough to realise that any strictures of mine will come to him as no surprise. Some months before his appointment as chairman he delivered the Denning Lecture and he roundly and publicly condemned jury trial as appropriate for complex fraud cases. Indeed, we now hear that so had the Lord Chief Justice. I cannot help but feel when reading the report a sense of chagrin and even of mortification flowing through it at the weight and the direction of the evidence received.
Surely the first task of an independent and impartial committee of inquiry—and many of us in this House have served upon them—is to discover from the evidence the extent of the problem and then to advance the remedies. The light of the evidence shines very dimly indeed in Chapters 5, 7 and 8, and with great diligence I have dug out and assembled the few serious references to the evidence in the report. First, there is no accurate evidence to establish that there have been any doubtful acquittals or convictions in fraud cases. Secondly, there is no accurate evidence to establish whether any retrial has been caused by jury disagreement. Thirdly, there is no accurate evidence to establish that juries acquit more often in complex cases. Indeed, from Appendix K they appear to convict more often. No doubt the Commissioner of the Metropolitan Police told the committee that he obtains the remarkable figure of 90 per cent. conviction in fraud cases. There is no satisfactory evidence of any significant number of cases not being prosecuted for fear of jury incomprehension, in spite of what we have just heard from the noble Lord, Lord Benson. Indeed, those words come from the report itself. At page 193, paragraph C9, we discover an analysis by the Director of Public Prosecutions in 1983 of 179 cases of which one fell into that category.
As we have heard, the committee could give no precise definition of a complex fraud case as opposed

45
to an ordinary case for which they favoured jury trial. The best they could do was to lay down guidelines—28 of them—in an appendix at page 153. However, on the evidence, they were unable to ascertain how many would fall within those criteria—very few indeed, said Mr. Merricks in his dissent. Today we have heard from the noble and learned chairman that there would be about 30. Appendix J establishes that from 1979 to 1983 there was an average total of 20 long fraud cases in England and Wales. So it appears that the problem affects a very small number of long cases in a year.
In Appendix A we also discover—and it has to be dug out—that the committee very properly initiated a survey of these long cases. Its purpose was to discover the length, the offences, the results, the status of the judge, the number of re-trials, the occupations of the jurors, the pre-trial reviews, and so on. The results of that survey, the committee blandly tells us, are,
"noted at various parts of our Report."
In fact there are three notes, each of them only to the length of trial. As to the results of that report and of that research, another deafening silence. One wonders whether the results were inconsistent with the rhetoric.
Only when we read Mr. Merricks' devasting dissent do we find the facts which have already been referred to, that the overwhelming evidence of all those closest to the existing system, all those charged with working it at the coal face, as it were, favoured the retention of jury trial. It is only in this minority report, amazingly enough, that one can find reference to the profoundly important constitutional issues raised with the committee by our greatest living authority on jury trial, the noble and learned Lord, Lord Devlin, in evidence to which I shall return later.
In Chapter 4 I find the proposed new procedure of a transfer certificate on an application, if desired, to a judge for discharge an imaginative idea. I hope if it is adopted that the opportunity will be taken to reconsider the basis for committal, because at present a magistrate, if he finds the evidence which is presented is such that a jury, properly directed, could convict, then must commit the case whatever he himself may think of the evidence.
The Royal Commission on Criminal Procedure recommend all prosecution authorities to adopt the DPP's criterion for launching a prosecution; that is, is there, on the balance of probabilities, a reasonable prospect of conviction? If the judge in this procedure could adopt that principle, then cases could be stopped, and money and trauma saved, if he, the judge, considered the evidence was unreliable or too weak.
In Chapter 6, the preparation for trial, the committee generously acknowledged its debt to the Criminal Bar Association in basing its improvements on the pre-trial review which was initiated at the Old Bailey 12 years ago by the Criminal Bar. I naturally welcome the reforms proposed with enthusiasm.
The most controversial and revolutionary of those proposals is defence disclosure before trial. It is right to place on record the origin of that idea, because the words in the CBA report of 1980 were these:
"It is possible to impose extensive disclosure obligations on the defence without offending against the principle of the right to silence and the burden of proof".
46
It is right that those words should go on the record, because there was no rigidity in that area of criminal trials.
It is from that standpoint that those proposals, in my submission, should be carefully examined. I too, as the noble and learned Lord, Lord Elwyn-Jones, said, am unhappy at the form of the sanctions for failure to disclose, or for misuse of the information by the prosecution, at paragraph 6.79 and 83. Here there looks to be an attempt to return once again to parts of the iniquitous 11th Report of the Criminal Law Committee which was so effectively killed in this House 10 years ago. In passing, I might say also that it is a different situation from the alibi defence, because of course in the alibi defence there is no question of the jury drawing inferences if there is a failure to disclose in that sense.
I now turn to the unacceptable points of this report, Chapters 5, 7 and 8. Chapter 5, changes in the rules of evidence. These changes simply will not do. As a radical lawyer I strongly support sweeping away outdated and technical rules, and some sensible progress was made in Section 67 of the Police and Criminal Evidence Act to that end. But here the rhetoric and special pleading pour forth like lava.
The strict standards observed in criminal trials are swept away. As the advocacy abates we are left with the radical new rules starkly revealed:
"Let all documents speak for themselves as to the truth of their contents. Admit everything, and leave it to the judge to decide what is fair".
The problem always is, how far can we relax the hearsay rule? Where the liberty of the subject is concerned judges have been strict in disallowing statements such as, "I was told by X that Y did it" or, "This letter alleges that Y did it" because such, if evidence, is inherently unreliable, capable of easy manufacture, and more so in fraud cases than in any other, and it is not subject to cross-examination.
In crime the incentive to give unreliable or perjured evidence is far higher than it is in civil cases, and yet we find no calm discussion of this difficult question in this report. We are told at paragraph 5.3:
"The layman regards [it] as astonishing … lawyers' nonsense".
The layman, in everyday life, takes decisions of importance on what his subordinate has been told by another subordinate; phraseology perhaps as revealing as the, "Would you give it to your servant?" in the Lady Chatterly case.
The report says:
"We have been told"
of defendants who refuse to agree documents solely to prolong the trial, confuse the jury, and "play the system". Where does this anecdotal evidence come from? Was there no judge in charge of the proceedings?
This unworthy rhetoric ends with this radical new rule:
"Let all documents speak for themselves".
Therefore, we are to enter the age of the speaking document: oh, blessed commercial document; blessed commercial witness; no perjury; no prevarication; no oath or affirmation; no tedious cross-examination, just the simple purity of the commercial document. My

47
Lords, I suggest that we have a sensible committee, or the Law Commission, come up with some workable recommendations rather than those in Chapter 5.
On jury challenges, here the rhetoric reached hyperbole. At paragraph 7.15 we are told that the right to challenge is rooted in the past when most offences were capital and—notice the irony in view of the Ponting case—
"when judges were less concerned to protect the interests of the possibly innocent than to uphold what they sincerely believed were the interests of the State."
My Lords, plus ça change.
We then pass to juries being "rigged", "tactical exercises", "cynical abuse", "manipulations of the system". Can this really be the proud profession which I have known for over 40 years? Or is this not the Roskill but the Rumpole report that I have been reading? It is like a worm's-eye view of the Old Bailey from Lincoln's Inn.
The innocent accused gets no mention in this report. He is a non-person. But when he enters the dock he has no knowledge of, or say in, the selection from the small group comprising the panel from which his jury will be chosen. When confronted with the 12 selected he may find all are over 50, all are under 25, all men, all women, all white, no black, all from one area of his own locality or all from one income group. Some may appear just hostile. The right to challenge is absolute in the face of the court for the benefit of the accused to allow him, against whom most of the cards are stacked, to have a say in obtaining what he considers a more representative jury. He cannot select. He can only remove.
Perhaps the noble and learned Lord the Lord Chancellor, and even my noble friend Lord Wigoder, would accept the view of a Law Officer in the present Government, a man of the highest honour, who has actually practised in the criminal courts, Sir Patrick Mayhew, who says:
"Counsel have a right and a duty to use this 600 year old right … as they conscientiously think best in the interests of their clients … together with all other lawful needs".
When is a right not a right? When it is exercised?
It is another reflection of the decline in the standards of public life, of this Government and party opposite, that members of another place not liking the verdicts in the Ponting and Cyprus cases, publicly attacked the juries concerned and sought to pin on them the failures of the prosecutions. Such arrogance and contempt for the institution that lies at the very heart of our law and order system is unforgiveable, I suggest.
Lord Devlin said:
"It is the sovereign power of acquittal which gives the jury its place in the constitution".
Blackstone warned of the danger of autocratic governments and superior persons gradually sapping and undermining the jury system. In recent years this process has gone far enough. I agree with Mr. Merricks that to substitute as a sop the peremptory challenge with a challenge for cause will only bring the judge down into the arena and the American system into our courts. This right of peremptory challenge, I would submit, should be preserved.
Finally, to Chapter 8 and what I would call this half-baked idea of a special tribunal. The committee
48
discloses its view of the jury, the one institution that guarantees for all of us within the law that liberties will prevail, what the noble and learned Lord the Lord Chancellor has called the palladium of the constitution.
At paragraph 8.22 we are told:
"Society appears to have an attachment to jury trial which is emotional or sentimental rather than logical".
Logical, like our attachment no doubt to habeas corpus, to parliamentary government, to the monarchy and even, if I may say so, to the Leader of this House. Then:
"in almost every area of the law, society has accepted that just verdicts are best delivered by persons who are qualified by training, knowledge, experience and integrity".
We have heard this from the noble Lord, Lord Benson, this afternoon. Then the final pearl that drops from this committee:
"In our opinion the absence from the jury box … of persons with these qualities seriously impairs the prospects of a fair trial".
Here lies the true heart of this report, this philosophy, as we have heard from the noble and learned chairman, of special skills, What a cavalcade of intellectual arrogance and effortless superiority, my Lords! Who are these paragons, these demigods who are to replace the common riffraff that we find in the jury box? Why, my Lords, first, Her Majesty's judges and in paragraph 8.61:
"Persons … hand-picked [by the Lord Chancellor] after a careful process of enquiry and vetting".
These angels of moral rectitude reared in the pure atmosphere of the City of London. 'I am the radical", claims the noble and learned Lord the Lord Chancellor introducing this report on 14th January. We have heard the same from the noble and learned Lord, Lord Roskill, today: "I am the radical". Radical, my Lords, to deny one class of citizen of his immemorial right to trial by jury on the order of the judiciary?
The Lord Chancellor: My Lords, I did not want to interrupt the noble Lord in the midst of his rhetoric and special pleading, but I said at the beginning of this debate that the whole subject was wide open to discussion, that attitudes should not be taken from which it was difficult to resile with honour and that my mind was open to arguments.
Lord Hutchinson of Lullington: My Lords, in those circumstances I am encouraged to continue, particularly to all your Lordships with open minds. To deny one class of citizen his right to trial by jury on the order of the judiciary, to impose upon him trial by a judge chosen by another judge and flanked on one side by Mr. Price and on the other by Mr. Waterhouse, is that radical? Where would this kangaroo court lead us? Let us imagine Sir Balance Sheet, the City financier, acquitted on a majority decision with the judge dissenting. What standard of honesty was being applied, that of the City of London? There would be no public summing up, there would be no public direction. The press and the public would understand nothing of the cosy exchange between the commercial counsel and the court. Let us think of the gossip in the Temple in those circumstances and in the coffee bars of the City, the leaks and scandals in the press.
Supposing Mr. Profit and Miss Loss—Sir Balance's subordinates enmeshed in a mountain of hearsay

49
paper created by Sir Balance to cover his tracks, paper speaking the truth loud and clear—were convicted, after a struggling ill-paid young counsel on legal aid had conducted a poor cross-examination on the video satellite link. Let us suppose there was conviction against the wishes of the judge. Let us suppose the judge were the Recorder of London and that the defendants decided to appeal to the Court of Appeal, to the judge's own colleagues. My Lords, what embarrassment, what tittle-tattle in the Temple! This half-baked idea would rightly plunge the criminal process into disrepute.
I end by reference to paragraph 8.13 where the committee refers for support for its new tribunal to some informal evidence that had come its way. Informal evidence, my Lords? Gossip? What of the most vital formal evidence before the committee, to which no reference whatever is made, from the greatest expert on jury trial, Lord Devlin? I asked to see this evidence before the debate, but I was told by the secretary of the committee in the Lord Chancellor's office that it has not yet been put into the "public domain" and therefore was unavailable. But I have it here, and I intend to end by quoting three short and separate passages from it, having observed the traditional decencies of my profession and asked and received permission to do so.
The noble Lord is speaking of the abrogation of the citizen's constitutional rights to trial by jury. He said:
"Trial by jury forms part of the political compromise that we have made between arbitrary and popular government. 'Arbitrary, in this confrontation means the rule of those [for instance] the judges, who are not answerable to the electorate".
He goes on to say:
"Not since the glorious revolution of 1688 has a citizen been imprisoned for any substantial time … longer than the short sentence for summary offences, otherwise than on the verdict of a jury".
Finally, he says:
"There is no room in the criminal law for the idea that a case could be too complicated for a jury to understand. To refer a case for decision to a body of experts or even to men and women of superior mental powers would mean that the person accused might be imprisoned for ten or fifteen years or for life, for reasons which could not be made clear, to the average citizen. This is not democracy. This is what trial by jury prevents".
In America, jury trial is protected by an article of the constitution. Here, it is only we in Parliament that can guarantee its integrity.
6.10 p.m.
Lord Wilberforce: My Lords, we are getting a little behind time and the hour is getting late. I cannot deny myself the pleasure first of offering very sincere congratulations to my noble and learned friends and colleagues, Lord Roskill for his report and Lord Griffiths for his splendid maiden speech. I congratulate them most heartily.
It is also a great pleasure for me to be able to follow the noble Earl, Lord Buchan, because my own ancestor, who was the contemporary of Lord Erskine, Lord Chief Justice Denman, was just as wholeheartedly wedded, as was Thomas Erskine, to trial by jury. Therefore I hope that that great principle is as much in my blood as it is in the noble Earl's. I greatly enjoyed and appreciated his speech.
50
I do not propose to follow, even if I could, the rhetoric and special pleading argument which we have just heard from the noble Lord. Rather abandoning the somewhat Alice in Wonderland conjurations, with which he amused some of your Lordships and perhaps terrified others, I intend to concentrate on two rather prosaic points. Perhaps I may say at this point that I hope the noble Lord, Lord Glenarthur, will acquit me of discourtesy if I am unable to stay quite to the end of the debate on account of an engagement.
Those two points are the preparatory procedure before trial and the mode of trial, the former, preparatory procedure, being in my view, a view which I share entirely with the noble Lord, Lord Wigoder, by far the most important of the two. If I may, I will deal with these points from a particular point of view, namely that of the Corporation of Lloyd's, which has been named very much in relation to fraud charges and which figures in many places in the report. I have not, and never have had, any financial interest in Lloyd's Corporation, but I have been for the last three years independent chairman of their appeals tribunal in disciplinary matters. As such, I have been brought very closely in touch with a number of important proceedings which have been taking place.
As your Lordships probably know, while the prosecution machinery, through the director, has for understandable reasons not been moving very fast, Lloyd's Corporation, on the other hand, has been actively pursuing cases of misconduct in relation to its own members. Out of 18 such cases which have been referred to the tribunal since the Lloyd's Act 1982, six can be categorised quite certainly as cases of serious fraud. They have been tried by what the noble Lord, Lord Hutchinson, has just called a half-baked kind of tribunal or a kangaroo court, namely, a lawyer president with two assessors, the lawyer being a commercial QC with experience of financial matters and the two assessors being gentlemen of particular experience in the market. I think that their experience may be of some use to your Lordships and perhaps to those who will have to decide upon the report.
Of course it is true that the proceedings in Lloyd's are disciplinary proceedings, not criminal proceedings. It is also true that the defendants are not in danger of losing their liberty. But they are in danger of losing their livelihood and, what is more important, their reputations. The charges are charges of fraud in a truly criminal sense. The standard of proof accepted by the Lloyd's tribunals is the same as that in criminal trials, namely, that proof must be beyond all reasonable doubt. Thus, I think it may be justifiable to say that experience in this area is of relevance here.
Perhaps I may deal first with a few general points because I should like to put the question of complex fraud in rather a wider setting than it has been put up until now. First, fraud is a very wide concept. There is hardly any human action which cannot be committed either honestly or dishonestly. One can have fraud right down the spectrum. The report in Appendix F, at page 226, has given examples of different kinds of fraud. They are, of course, extremely varied. I think no one would dispute the general proposition that if a man is accused of fraud, is going to lose his reputation or, still more, his liberty, he is in principle entitled to be tried by a jury.

51
Within this very wide category of fraud, there is undoubtedly, I should suggest, a genus of financial or economic fraud, and that is a recognisable genus. Financial and economic fraud is not peculiar to any country. It is not peculiar to any square mile. It is not peculiar to any particular institution or room within any particular square mile. There are conspicuous cases in every country. I can mention only a few, which your Lordships will instantly recognise.
In the United States there are a great number of banking frauds. At the moment, the best known one which is going through the courts is what is called the Pine Top case, which is concerned with amusement parks. It is a fraud of 21 million dollars. In West Germany in 1984 there were reported 500 cases of financial economic fraud, of which over 70 per cent. were the subject of proceedings or settlements. At the present time, they are grappling with a worldwide famous case called the Von Galen case. In Spain there are the Ruiz Matteos proceedings, a huge complex of proceedings which are going to occupy the courts for every bit of 10 years. In the Far East there is the Pan Electric matter, which has rocked the whole economy of Singapore.
We in this country, as international traders, who have always traded on a good faith basis, have to take this disease very seriously. We have a duty to remain in front, as I believe we are in front, of other nations in the pursuit and prosecution of fraud. To pretend that it is a British disease is to render no service to our economy. It is not: it is a worldwide disease. There is much more to it than even City fraud. If I have any complaint against the wonderful report, it is that perhaps it focuses a little too much on City fraud. There is much more to complex fraud than that.
One very big area is marine fraud, which is mentioned in the report. That is estimated to lose £1 billion a year. The noble and learned Lord, Lord Elwyn-Jones, gave the figure of three-quarters of a billion for fraud in general. Marine fraud, on the best estimate, alone runs at £1 billion a year. That is now extremely sophisticated. One does not now, as one did in the days of Demosthenes in his private orations, just scuttle a ship. A ship is of no value nowadays; there are far too many of them. What one does is enter into very complicated and sophisticated transactions about the cargo. One sells it many times over by forged bills of lading and other documents. The noble and learned Lord of course knows this extremely well. There is an example about which all your Lordships will have heard. That is the Salem case, in relation to a ship which was sunk in January 1980 and which has been the subject of proceedings in Greece, the United States and Rotterdam.
Then there is revenue fraud, a huge category; VAT frauds, very ingenious frauds involving manipulations of accounts, duplicate accounts, use of companies and so on, very ingenious and clever matters indeed. The only point that I am trying to make is that we are not just concerned with a few City scandals. This is a general phenomenon found in many areas in many parts of the world. It is a case of financial, economic fraud. Within that genus, financial economic fraud, I believe—and I share that with the report entirely and with other noble Lords who have spoken—that there is
52
a species which one can call complex, financial, economic fraud. That is a function of the internationality of commerce nowadays; it is a function of increasing technology. I was very glad to see that the committee included among its members, Mr. David Butler, a well-known expert in this subject of information technology. It is a function of inflation, it is a function of the existence of controls, sanctions, high taxation—areas in which the rewards of escaping from them are very great indeed. Usually this complex species of the genus financial, economic fraud has an international dimension. It involves the use of foreign companies.
The noble Lord, Lord Benson, whose speech I greatly enjoyed, gave some examples from his experience. Perhaps I may give just one or two from the Lloyd's experience. In one of their cases there were 150 companies involved with unidentifiable shareholders. There were trusts in Liechtenstein, with Swiss lawyers acting as directors, usually on verbal instructions which one cannot find recorded anywhere. You have huge files of documentation. The noble Lord, Lord Benson, gave his example in terms of metres. I shall give mine in terms of numbers. There was a case referred to by the Attorney-General the other day which involved no fewer than 1 million documents and in the PCW case (which as your Lordships know was one of the biggest Lloyd's cases) there were no fewer than 300 files.
So, although it is difficult to define in precise terms what is complex fraud, one cannot deny its existence unless one is simply flying in the face of facts. The report has done its best to give a definition in the guidelines in Page 153. Of course, any competent lawyer could shoot many holes through them; they are not definitions of precision. "High finance" is descriptive as a term but hardly one of legal accuracy. But in my belief these cases are capable of recognition. There are cases as to which one can say with confidence that they are beyond the comprehension of many judges, many lawyeres and most if not all jurymen. No doubt, there are not many of them. One may argue as to how many there will be. I should rather be on the side of the noble and learned Lord, Lord Roskill, on this.
The question is going to be ultimately for the Government to decide—and I do not envy them the decision—whether there are enough of them or whether the numbers of them are of sufficient gravity to justify a reformed procedure. And then, whether a reformed procedure if introduced in this area, is going to infect or currupt the rest of our legal system.
Now to my two points; and they will come very quickly. First of all, preparation. Undoubtedly, this is the key to the whole matter. On this, the report must surely be esteemed as very good, as excellent. All its suggestions are practical and wise. Lloyd's has in fact been using something very similar in relation to its proceedings. They hold preliminary hearings by the lawyer QC and, in the PCW case which I have just mentioned, we had six of those. The report of the noble and learned Lord contemplates similarly that there may be more than one. We had six in that case. And they take a sensible view about documents. They do not feel themselves fettered by legal rules, an attitude which of course is entirely consistent with acting in accordance with the law.

53
Just let me give your Lordships the timetable, which I believe is interesting, if one really tries to apply modern procedure. Charges were formulated in May of 1984. Of course, before that time there had been many massive investigations by the Department of Trade and Industry and other agencies. The charges were formulated in May 1984 and then, between June and October 1984—a period of four months—there were six preliminary hearings by the QC. The hearing took place in November and the verdicts were given in January 1985. If that proves anything—and I think that it does prove something—it shows that this system of streamlined procedure in front of this half-baked court does work and could be generalised into other cases.
One has to say unfortunately that its effectiveness will depend largely upon money; but one can console the noble and learned Lords who have to provide the money by the (I think) counter-argument that a great deal of money is going to be saved in court costs, and so on; not to count the money which is recovered in Revenue cases etc., which can be put on the profit side. So, in my respectful submission, this part of the report—and it is the major part—can be most wholeheartedly recommended, and I feel sure that its merits will appeal to those interested in getting proper disposal of fraud cases.
Now just a word as to the mode of trial. I believe that our experience with this court of judge and QC plus assessors does work. Nobody has complained about it; nobody says that it does injustice to anybody. It enables cases to be brought on and to be disposed of with reasonable expedition. The question may be asked whether it gets more convictions than a trial by jury would get. I am not sure that that is the right question because, as the noble and learned Lord on the Woolsack has said, the object of the proceeding is to do justice, to convict the guilty and to acquit the innocent. Simply to ask whether one procedure gets more convictions than another is not necessarily an answer to whether it should be adopted.
In any case, it is impossible rationally to decide whether any one procedure produces more convictions than another. Of these cases, I have seen one in which the tribunal convicted, in which I thought that the jury would very likely acquit. I have seen another case in which the tribunal acquitted, in which I thought that the jury very likely would have convicted. It is all a matter of speculation. I do not believe that one can form any judgment on that line of argument.
The main problem about setting up this tribunal in this case is that of definition, the one to which I have already referred. You cannot lay down a definite line; you cannot provide a firm form of words. But I believe that the report's solution is a wise one, a pragmatic one, one that can be worked; to leave it to a High Court judge to decide when the prospects of the trial are known. He should be given, I would suggest—and I do not think that this is contrary to the report in any way—a broad directive that trial by jury remains the rule in all cases where man is accused, and that trial by jury is only to be departed from if a case is clearly made out that justice can only be done by another procedure. If that kind of directive were given. I believe that would give a workable means of operation.
54
That very closely coincides with the suggested Hong Kong Bill, which your Lordships will find on Page 218 of the report. You will find there that the chief justice in Hong Kong was given power to order trial by judge and three commercial adjudicators where he was satisfied that—and then on that page there are three considerations set out corresponding to what I have just said. That has not yet been accepted by Hong Kong. It has been resisted by the lawyers but it is something which I would suggest deserves consideration.
On one final point, as has already been said, this particular kind of procedure has the merit from the point of view of the accused person of admitting an appeal. Reasons are given, they can be challenged on appeal. We have an appeal procedure, and from our experience I think I can say that it works. There is not a flood of appeals. The working of the appeals procedure and the dealing with the appeals when they come is a perfectly respectable and acceptable legal process.
I do not think that I can take this particular line of argument any further. Broad issues of constitutionality and what is politically possible are involved. They are matters which will have to be decided elsewhere after hearing the whole of the debate. I thought it worth while giving your Lordships some concrete observations on the system in practice which might illustrate the merits and strength of the report.
6.30 p.m.
Lord Denning: My Lords, in the earlier discussion I said that I congratulated my noble and learned friend Lord Roskill and his colleagues on the report, and that I agreed with every word of it. Having reread the report, and having heard the most informative discussion in your Lordships' House, I still agree with every word of it and hope that it will be put into force. I should like also to congratulate my noble and learned friend: his exposition and his experience are of great value to your Lordships' House and I agree with every word that he said.
I congratulate also the noble Earl on his great ancestor, Thomas Erskine, the great hero of trial by jury. Time after time I have supported and quoted that great advocate—probably the greatest advocate that the English courts have known. But, my Lords, 200 years ago trial by jury was so different. Our society and our commerce were different then before the Industrial Revolution. It was a simple, uncomplicated society. The jury had to try a few pleas—the murders, the burglaries, the rapes; and maybe seditious libel occasionally, on which Thomas Erskine was so good. Perhaps there might have been simple frauds; but that was the lot
Jump now over 200 years, and hear what my noble and learned friend Lord Wilberforce has told you of the finance and commerce of today. If your Lordships only knew what I have seen! The limited company only started in 1862, 100 years after Thomas Erskine, and the limited company in this country and all the countries of the world is the most prolific instrument of fraud, with people switching from one company to another, and so on. All sorts of fraud are done through limited liability, which only came into existence a

55
hundred years ago and has only come into its great pre-eminence throughout all the countries of the world in the past 30 or 40 years, with all the frauds connected with it.
Some 200 years ago there was hardly any insurance. Edward Lloyd, I think, had only just started his coffee house handling a little marine insurance. Banking was in its infancy, with a few family banks. It was largely an agricultural society. We have a transformation today, when we see these financial and commercial frauds. My noble and learned friend Lord Griffiths gave a good illustration of switching between this company and that, going overseas. I have seen it myself, and my noble and learned friend Lord Wilberforce knows more about this than anybody. There are frauds all the world over—complicated frauds, switching from this to that, with people putting their money into numbered bank accounts in Switzerland where it cannot be got at. I have seen people who, having committed fraud here, have gone off to Germany before they could be arrested.
We have seen all these things, and it is imperative that our legal system should be modernised so as to cope with this great modern disease. That is why I am afraid we have to leave trial by jury and we have to replace it by a modern instrument. The example has been well shown by my noble and learned friend Lord Wilberforce, and of course it has been given in Lord Roskill's report: namely, have a judge, experienced in these matters, and two good laymen who are also experienced in these financial matters, who can unravel these frauds. I would support that entirely.
I should like to mention this right of peremptory challenge. It is high time it was abolished. Let me tell your Lordships how it started. In Blackstone's day it was only available for felonies if capital punishment was involved. It was not available for misdemeanours or for frauds. If a man was being charged with an offence such as murder and the like, for which he could be hanged, then of course give him every chance. He might know some of the jurors in those days. Let him have a peremptory challenge and object. He had nearly an infinite number then: I think he could go up to 23. That is how it all started; and when I was practising at the Bar, and even when I was a judge, I never heard a single peremptory challenge and I never had one made to me. That was in the good old days.
Jurors were not then any old chap on the voting list: they had to be householders. They were mainly small tradesmen and people from our country towns and villages. As Lord Devlin put it, they were all male, all middle-class and middle-aged, and they dealt with their cases splendidly, if I may say so. There were no peremptory challenges used then; but now the position has been transformed. First, everyone is entitled to be, and is, on the voting list from 18 to 65. Also, in the old days the sheriff or his officers used to know the occupations of the individuals. In a big and complicated fraud case I tried at the Old Bailey I had a first-rate set of jurors. Of course we knew their occupations: they were bank clerks, insurance clerks, and so on. We finished it in six weeks and they convicted in a couple of hours. We could do it all right in those days; but now, with everybody on the voting list, the person who selects them, or the clerk, does not
56
know their occupations anyway. He just has to run them off on a computer and they turn up in the court and there you have the panel—youngsters of 18 or 19, girls and boys, people of all sorts and descriptions—and a very good jury when they turn up, if you please. Those are the kinds of people that you have.
What happens with peremptory challenge is that I am afraid counsel (they think it is their duty) will challenge anyone if they think it convenient. They will say, "We will challenge anybody who looks as if he understands a bit about the case". They say "Object" to anyone who appears well dressed and who may have a paper under his arm such as the Financial Times, and so on. Or they sometimes do it—they ought not to do it—by the colour of the skin or whatever the reason may be. Counsel object in accordance with what they think are the best tactics; and so we do not really get a random jury. We have a jury which the defence have had quite a good say in selecting. So I suggest that it is high time to change and that peremptory challenges should be abolished. It should not be left at three, or even one; but of course you keep the challenge for cause. If there is any good reason, let them challenge and let them put the reason; but let the peremptory challenge go.
The other remaining thing is the right to trial by jury. I have said that I hope to show how heartily I agree with what has been said of the complication. My noble friend Lord Benson and my noble and learned friend have said that these cases are far too complicated for the ordinary jury to understand. Little girls of 18 or 19, or old men of 60—it does not matter who they are—do not understand. In principle, you should have a jury which can follow the evidence and give a verdict in accordance with it. You simply cannot get that with a jury raised as it is in these days, and the only reasonable alternative is that which is suggested by this report.
I would finish with one word more, because this is an important matter. The report points out the difficulty of getting a firm to report a case to the police. The report states in paragraph 2.6:
"The early discovery and reporting of fraud to the appropriate authorities is crucial to the chances of successful prosecution."
The report states in paragraph 2.5:
"The failure to report fraud to the authorities is widely believed to occur, though its precise extent can obviously only be guessed at."
If a firm or a big City institution is being defrauded, will it all come out in public? The reputation of the firm may be harmed a great deal. Is it not better to get the money back if you can? Is it worthwhile going to the expense and trouble of a trial with all the uncertainty of a conviction from trial by jury? I am afraid that in a lot of these cases the firms do not tell the police for one reason or another. The report states:
"There is no legal obligation upon victims to report fraud, unlike in the United States, where any fraud on a financial institution involving more than $5,000 dollars must be reported".
That does not arise on this report. But it is almost a public duty to report fraud to the authorities so that they can take appropriate action. So I hope that this report will be welcomed and implemented.
6.43 p.m.
Lord Edmund-Davies: My Lords, by my standards the hour is already late. I hope that I may be forgiven

57
if I confess that I set out to be brief. Generous tribute has rightly been paid to the noble and learned Lord, Lord Roskill—not Lord Rumpole—and his distinguished committee for the remarkable report that they have produced; a report which is stimulating to a great degree. It raises points some of which are startling and many of which are controversial.
I tell your Lordships at the outset that whatever preconceived ideas I have—others have prejudices; I have ideas—I am not going to let my conclusions be at all determined by those preconceived notions. I set out, as the noble and learned Lord on the Woolsack adjured us to do, to keep an open mind not only until this present debate has ended, but also so as to give myself time for reflection on what I have heard. Then, ultimately, maybe some time ahead, I shall come to a conclusion and give my vote accordingly.
I seek to introduce a note of homespun quality and a new note. We have to remember that complex frauds take up a small but very important part of the considerations which the Roskill Committee had to review. There is a large array of fraud cases unaffected by, for example, the recommendation in relation to the dispensing of a jury. A vast number of fraud cases will continue to be tried with a jury. I have therefore decided to invite the consideration of this House, very briefly, to a matter which has not received the consideration of the committee, I suspect because if it ever occurred to them to think of the topic, which is unlikely, they might say that it did not strictly come within their terms of reference. It is:
"to consider in what ways the conduct of criminal proceedings … arising from fraud can be improved and to consider what changes in existing law and procedure would be desirable to secure the just, expeditious and economical disposal of such proceedings."
I think I may claim in no vainglorious way to have had longer experience of jury trials, both as an advocate and as a judge, than any other Member of your Lordships' House today, not excluding, I believe, the noble and learned Lord, Lord Denning. That may sound tricky, but it happens to be true—
Lord Denning: My Lords, he is quite right.
Lord Edmund-Davies: My Lords, accordingly I claim experience and knowledge of what I am talking about. There is one matter which has never received consideration before by any of those responsible for the designing and setting up of courts, nor of those who have used the courts. The jurors have received scant, if any, attention as to their comfort and their capacity to discharge their vitally important duties. A fraud case—it does not have to be complex—frequently involves the close and accurate study by jurors, unused to administering the law, of documents, complex up to a degree, informed and numerous in quantity. All of us know that when we do our paperwork we like a flat desk or, best of all, a kitchen table—some place where we can spread our papers and study them properly. No, my Lords, there is no court in the country where you will find proper provision made for the capacity of jurors—capacity to sit, yes—to do their work properly.
I recall one occasion when, as an assize judge, I arrived in a town and saw that one of the cases in the list involved charges of fraud. There were a certain number of documents to be studied. I had a look at the
58
documents and then told my clerk, "I want to see the court." The commission day was on the day following. We went down and, having seen the provision made in the design of the jury box, I announced next day when the High Sheriff arrived, "We cannot try that fraud case in the assize court. It is hopeless. It cannot be used. It is not fair to the jury and I am not going to try it." I asked, "Is there some other more convenient place in a building in this town? What about the council chamber?" We looked at the council chamber, and I said, "We will take the fraud case here and every juror is to have two pews allotted to him, one for him to sit in and look at the documents immediately under consideration, and the second for the spreading of the documents."
We did just that. I have no doubt that it contributed to what I regarded as a just verdict being arrived at. I cannot remember now, and it does not matter for present purposes, whether it was an acquittal or a conviction. I hope that long before—it may be the distant future—the matters raised by the report are determined, attention will be paid to the homespun note I am now sounding. Let us have proper attention paid to the jury; not only to their physical comfort but also to their capacity to do their job.
I said that I had not made up my mind. If I had approached something like a fixed stance then I would in all honesty have found myself obliged to abandon my fixed position in the light of the debate to which we have listened so far—and I am very conscious of the fact that there are five more noble Lords to be heard.
In relation to the matter of dispensing with a jury in complex fraud cases alone, I would find myself obliged to contrast, on the one hand, the splendid maiden speech of the noble and learned Lord, Lord Griffiths, and the equally arresting maiden speech of the noble Earl, Lord Buchan, on the other. I should have to contrast the rhetoric and delightful play of the noble Lord, Lord Hutchinson of Lullington, with the close analysis of the noble Lord, Lord Benson, in the course of his arresting speech. All those matters require reflection and I propose to give them that. My Lords, do see to it that the jury is properly looked after.
6.52 p.m.
Lord Hacking: My Lords, I have three reasons for participating in this debate. The first two are personal. When I was called to the Bar in 1963 the noble and learned Lord, Lord Roskill, had recently been elevated to the High Court Bench. But thereafter there have been many occasions when he has shown kindness and interest in me, as he has with so many aspiring young members of both sides of the legal profession. Now, sadly for us, the noble and learned Lord has decided to retire from service in our judicial committee, although, happily, not from our Chamber. He and members of the fraud trials committee have put before us a thoughtful, balanced and thorough report. I therefore readily join with others in expressing thanks and gratitude.
My second reason for participating in this debate is also personal. More years ago than perhaps either of us wish to count, the noble and learned Lord, Lord Griffiths, who was then a leading junior member of the Bar specialising in personal injury work, was my pupil

59
master. He was also pupil master to many others. Indeed, At the height of his practice there was a positive parade of young pupils following him across the Strand in to the High Courts of Justice. But I believe I am his only pupil thus far to come to your Lordships' House.
Quite apart from the noble and learned Lord's qualities as a pupil master, for which I am still grateful, he was—and I have no reason to think that he has mellowed over the years, after hearing his speech in your Lordships' House today—a supreme and strong advocate for causes in which he believed. For those and other reasons I feel sure that this Chamber will be much enriched by his presence. I also hope that he will give me a little of assistance over the matter of latent damage, upon which I shall be addressing the House later this evening and, I anticipate, on other occasions during this parliamentary Session.
The third reason for my participating in this debate is that I have some experience of jury trials both in this country, after 12 years at the English Bar, and in the United States of America as a member of the Bar of the State of New York. Although the recommendation relating to jury trials in the Roskill Report is only one of many recommendations, as has been pointed out in this debate, and a limited one at that, it will probably continue to be the most debated recommendation.
We have concluded that in this country, in almost all civil disputes, there are better modes of trial than the use of a jury. Not so in the United States of America. In civil cases the jury trial still has extensive use and is causing chronic problems that even go to the economy itself—particularly in such fields as medical malpractice. So serious is the problem that the president of the American Bar Association, when I met him two weeks ago in Florida, was talking of setting up a special commission.
Nor is there universal confidence in the United States of America about the use of the jury in criminal trials: for example, the use of the grand jury. However, relating to the recommendation made by the noble and learned Lord and his colleagues in their report, the simple question is surely this: given a blank sheet of paper before us, would we have chosen a randomly-selected jury taken from the electoral roll for a trial to do fairness to both state and citizen in matters of complex fraud, whether those matters arise in a trial of a civil nature or of a criminal nature? For the reasons that have been so clearly expounded in the report, the answer to that question must be no.
I was interested to read in chapter 8 of the report a reference to the history of the jury trial. The truth is that our forefathers did not create the jury trial in anything like its present form. For example, when Henry II developed the use of jurors in the grand and petty assizes that decided questions relating to the right of possession to land, the jurors in those trials were expected to speak of their own knowledge, were given time to find out the facts, and were sent away if they were found to be ignorant.
Whatever history may tell us, and it is my submission to your Lordships that history does not support those who favour the retention of jury trials, certainly in complex fraud trials, this matter must be
60
judged on its own facts in 20th century England. That is precisely what I believe the noble and learned Lord, Lord Roskill, has recommended in his report in 1986.
6.57 p.m.
Lord Templeman: My Lords, I too beg to support the recommendations of the Fraud Trials Committee. The report is so omniscient and so exhaustive that it even copes with the homespun point raised by my noble and learned friend Lord Edmund-Davies. Paragraph 9.26 is a plea for the facilities for witnesses to be improved, and paragraph 9.27 is a plea for the courtroom to be made large enough to house not only the innumerable counsel and their solicitors about also the tons of correspondence and papers that proliferate in the course of a long fraud trail.
The report of the committee is a fitting finale to the long career of public service of my noble and learned friend Lord Roskill. There runs through the report one main theme that has evoked a remarkable degree of agreement among those who have spoken. That theme is the need to select persons with training, experience and ability. The report recommends that the investigation of fraud should be undertaken by legal administrators or administrative lawyers chosen for their training, experience and ability—and no one disagrees.
The report recommends that prosecutors be similarly selected for such qualities—and no one disagrees. It recommends also that judges charged with the supervision of such trails should similarly be chosen for their expertise—and no one disagrees. It is logical that the report's final recommendation on that topic is that the tribunal that decides such matters should also be composed of persons of training, ability and expertise.
Your Lordships have heard from my noble and learned friend Lord Wilberforce of the widespread ramifications of fraud trials and the reasons for thinking that it is no longer right to have complicated cases of fraud tried by juries. Your Lordships have heard also what was, I thought, rather sneeringly described as the rhetoric of the noble Lord, Lord Benson, which I however would describe as the honest indignation of a man who comes afresh to see what goes on in law courts, is astounded by what he sees, and wants to put it right.
I add only two further comments. First, I understand that there are now in progress at the Old Bailey trails in which there are alleged VAT frauds. One or more of that series of trials is expected to last 18 months. Those of your Lordships who have had occasion to study the VAT regulations and those who have had occasion to find out the ingenious methods by which such frauds can he perpetrated will find it no disparagement to the jury system to suggest that the burden of those cases should be removed from juries.
My experience over the past 30 years has encompassed fraud—not fraud in criminal courts but fraud in civil courts. Throughout that period fraud cases were tried by a judge alone without the assistance of a jury. I have never heard it suggested that the results achieved by those judges were any worse than the results achieved by juries in criminal trials. In such fraud trials a man's reputation and his livelihood are at

61
stake. True enough, he cannot go to prison, but he risks, and fights for, everything in those courts. He is assisted by ingenious and experienced counsel.
In my experience most of those trials in civil actions are difficult. They raise difficult questions of law and fact, the construction of documents, of accountancy, and of statutes. For my part I hesitate to think that many of those fraud cases could adequately be explained to a jury which had no experience and possibly did not know the credit from the debit side of a balance sheet. If it is good enough in civil cases for major issues of that nature, sometimes involving millions of pounds, to he tried otherwise than by jury, then I suggest it must be right to extend the same courtesy to criminal trials.
The only discordant voice which I have heard since I came into the Chamber is that of the noble Lord, Lord Hutchinson of Lullington, who displayed the dazzling eloquence of the closed mind which is the foremost weapon of the skilled advocate. He implied that there was no evidence that anybody is dissatisfied with jury trials and no evidence that the public in general are growing cynical about the way that fraudsters are not brought to book. Of course there is no evidence in the sense that the noble Lord has not been able to cross-examine any jurors, but there is evidence in what we read; and what we read is not all untrue. There is evidence in the fact that we know that some fraudsters are not brought to book, and we wonder why. The idea that the committee had no foundation on which to base its eloquent recommendations is wholly wrong and I am not to be put off by quotations from Lord Devlin as though they were brought down from Mount Sinai in some distant past.
We live in a different era. My noble and learned friend on the Woolsack is charged with selecting 900 magistrates and I have no doubt that he would have plenty of opportunity and the ability to select those who would sit on the fraud tribunals recommended by the committee.
The noble Lord, Lord Hutchinson of Lullington, wants to leave everything as it is in the best of all possible worlds. Leave us, he says, to start by challenging the jury; leave us to deny everything and, finally (having confused the jury), leave us to say, "Members of the jury, are you quite sure that my client is guilty?" It is on that kind of eloquence that some of the fraud trials have ended prematurely or with results that seem to be remarkable to those who know something about the case.
Lord Hutchinson of Lullington: My Lords, may I intervene? Is the noble and learned Lord suggesting that we should get rid of the burden of proof?
Lord Templeman: My Lords, I am not suggesting anything other than that which is in the report. To my mind the report is eloquent, rational and reasoned. I can see no argument against it except the fact, as the noble Lord says, that some of these practices were invented 600 years ago and the fact that they are outdated has not been universally recognised.
Finally, the noble Lord referred, as he was bound and right to do, to the innocent. I accept all that he says, subject to this: on my reading of the report it is not the innocent who have cause to fear the carrying out of the recommendations, it is only the guilty.
7.5 p.m.
Lord Morris: My Lords, this is a debate where the layman rushes in where angels fear to tread. Bearing in mind that premise, I have somehow managed to draw some comfort from the certain knowledge that I am no angel. I asked my noble friends to speak late in this debate in the hope that anything that is worth saying about the report will already have been said. In this I have not been disappointed and the burden that I might have placed upon myself has been lifted. May I say how well it has all been said, not least by the noble and learned Lord, Lord Roskill, and by the noble and learned Lord, Lord Griffiths, in a memorably brilliant speech.
While discussing this report with a friend of mine at the Bar I suggested that, rarely among such publications, the report reads like a novel. His understandable response was to observe that I must read some very strange novels; to which I retorted, quite untruthfully, that they were not strange novels, just the classics. I was thinking, of course, of the pellucid clarity of the report and the exciting development of the argument within the report.
However, what particularly excited the imagination of this layman was how the report never strays from the most pertinent of quotations on its frontispiece page. There is one from the Magna Carta which goes:
"To no one will we sell, to no one will we deny or delay, right or justice".
The other quotation is from Psalm 84, verse 10:
"For one day in Thy courts is better than a thousand".
As many of your Lordships are aware, delay is as cruel a denial of justice as any. I humbly submit that the report itself provides the evidence for how, in part, the answer to this dreadful problem lies in the investigative stages and in the question of resources.
The report admirably recognises the fact that justice does not just begin when the door of the court opens. In Chapter 2 we learn that some 600 officers are employed throughout England and Wales by the police which is, of course, the major investigating body for fraud. Appendix E states that the Royal Hong Kong Police Force employs approximately half that number; namely, 300 officers doing nothing other than investigating fraud. In addition to those officers there is the Independent Commission Against Corruption and its supporting staff who also have investigative powers. The population of the United Kingdom is 55 million and the population of Hong Kong is 4·6 million. I admit that the measure is crude, but I think the point is obvious.
I should add at this point that I take some comfort in what my noble and learned friend the Lord Chancellor told the House in regard to the increase in the number of staff in this field which is being allocated to the Department of Trade and Industry; but I suggest that it is a drop in the ocean.
As has been referred to earlier in this debate, the City of London is under threat from fraudsters. I would, and do, go further. It is no longer a place for a gentle man—and I use that term in all its senses and all its connotations. It is now a place for cowboys and what the Americans call "quick buck operators". If this Government suggest that he who pays the piper calls the tune, our unholy mother, the Treasury, will

63
point out that already legal aid costs have one of the highest rising curves in public expenditure and that there are greater calls upon the taxpayers' funds, with all the familiar arguments of the Treasury. If so, I fear that precious little will be done. For is it not strange that when Governments want to spend money they invariably call it Government money, but when they do not want to spend money they always call it taxpayers' money?
A Royal Commission report is only as good as the degree of its implementation. As the report itself says on page 1:
"Where we believe radical change is necessary, we have not shrunk from recommending it. We hope the Government will not shrink from giving effect to it."
I can only say "hear, hear" to that.
Finally, I should like to make a short comment on the emotional subject of juries in complex fraud cases. I ask those responsible for deciding this matter to consider my very humble view. The report is clearly by no means certain upon this question. The argument against retaining a jury is undoubtedly elitist, but that is not wrong per se. Where I feel that the report is unhelpful is that by inference it is suggesting that a jury should have expertise. I most humbly suggest that that is wholly the wrong test. What is sought in a jury is precisely what is sought in a bench, and it is not expertise so much as wisdom.
Let me take expertise first. Is there any lawyer anywhere, in this House or elsewhere, with experience of examining or cross-examining experts in any field in a court of law, who has not cried out, "Lord deliver me from the experts". For the court so often proves that the more he knows the more he does not know what he does not know.
Secondly, let me take wisdom. I suggest that humility is a prerequisite of wisdom. Ask the wife of any lawyer whether humility is his strong suit. You might wait a very long time before receiving an affirmative answer. Ask the wife of a chartered accountant the same question, and I can assure you that you will never receive an affirmative answer. Just because a man is articulate, it does not mean that he is wise. Just because a man is an expert, it does not mean that he has judgment. Or take the corollary which is that, just because a man cannot express himself does not mean that he is stupid.
My great fear is simply that when the great judge and the two eminent chartered accountants weigh the evidence against their great knowledge and experience, then arrogance, stupidity, recklessness, unforgivable gullibility and other unattractive human traits might well condemn a man who had no intent to defraud. I implore your Lordships not to underestimate the wisdom of a British jury.
7.13 p.m.
Lord Mishcon: My Lords, may I say at once how much I enjoyed the short speech of the noble Lord who has just sat down? There is only one way in which anybody, when winding up a debate at this hour, certainly on this side of the House, can achieve any sort of affection from his colleagues, and that is if he makes his winding-up speech comparatively short. Let me admit right away that I, too, intended to quote
64
the Latin of Magna Carta, but the noble and learned Lord on the Woolsack has been spared my Latin pronunciation, which is absolutely different from that which he was taught. I well remember the agonised look on his face when I last quoted a Latin maxim, and I have been saved from that.
It is right, as the noble and learned Lord said, that on matters as weighty as this we should certainly try to keep an open mind and listen to the debate. I listened to the very worthy speeches that have been made on what I wish to say from this Dispatch Box was undoubtedly a very worthy report. One has to affirm that very definitely when one hears in the course of the debate two members of a party which delight to call itself an alliance and two lawyers of great eminence at the criminal Bar decide upon two different attitudes—indeed the difference could not be more marked.
I remember how the noble Lord, Lord Wigoder, described this report, saying that he wished to join in the expressions of congratulation to the noble and learned Lord, Lord Roskill, and the members of his committee for producing so very quickly such a constructive, stimulating, in some cases provocative but always highly readable, report, with much of which one could agree in principle. In my view, that master of understatement my noble friend Lord Hutchinson of Lullington did not exactly paraphrase that description of the report. Of course we all listened to him, with great interest, as we always do. Nobody can make a more formidable speech than he in the advocacy of any cause, and obviously he believes very sincerely in his.
If I may say so, there is one aspect of this matter which has not been expressed in this debate and which is not in this—though one may have different views about certain sections of it—admirable report. Certainly, until this report emphasised the need for reform in the investigation of fraud, a great number of interested ministerial departments, such as the Department of Trade and Industry, did not attach as much importance to the very serious crime of fraud as do most members of the public.
If I were alone in thinking that, I should not expect your Lordships to listen to me very attentively. However, I read an article that appeared in the Guardian which in its first paragraph recited the views of John Wood, who used to be the Principal Assistant Director of Public Prosecutions, given in his address to the American Bar Association in 1985 at their well-known conference in London. He said this:
"We in this country are exremely concerned about what appears to be an explosion in white collar crime brought about partly because sentences for bank robberies are very high while sentences for white collar crimes are ridiculously low".
He then went on to deal with the way in which the police in many cases fobbed off what seemed to be a very complex investigation of a fraud case; how the Director's office was hopelessly understaffed and how the Department of Trade and Industry conducted its inquiries under the sections which have been mentioned very often in the course of your Lordships debate; how these investigations very often lasted for many, many years—certainly three and a half years in one case which I can remember—and how, as a result of all this, very few prosecutions of complex fraud cases took place.

65
So I turn at once—and others have done this in the course of the debate—to a plea that we do not regard the question of trial by jury, upon which without any doubt at all I am sure that all your Lordships hold very fundamental and very sensible views, as the be-all and end-all of the Roskill Report. I shall give your Lordships my reasons. As the report itself says at paragraph 2.3 on page 9:
"Before a fraud case can be pursued information has to reach the authorities responsible for investigating or prosecuting. It seems that most complaints of fraud or reports of suspected fraud when made, go initially to the police".
At paragraph 1.3 on page 5, the report says:
"At the outset of our inquiry it was felt that the main part of our work would be concerned with the question of jury trials for fraud cases. It soon became evident, from the volume of evidence we received, that although witnesses were concerned about the retention or otherwise of jury trials, their main criticisms and suggestions related to the administrative and legal procedures presently in force in fraud cases which were thought to be out of date and unrealistic".
Absolutely rightly, in my humble view, the committee concentrated on what was responsible for the long delays and the inordinate expense before prosecutions (on fraud cases very largely) were brought to trial.
The committee undoubtedly has made recommendations from the very start of this matter which must at the very least have your Lordships' attention. What does it say on investigations? It says that they ought to be co-ordinated; that those investigating are under-manned; that there is not enough specialist experience; that members of the Bar have to deal with those matters at a later stage after investigation, and very often they have no experience of and no tuition even in how to read a balance sheet. So the committee says that at the investigative stages we need the manpower and the experience.
What does the committee then say about the stage when the investigation is complete? It says that time should not be wasted on the summary proceedings that take place without anybody getting any advantage out of them at all, and it is absolutely right. Let there be a transfer certificate which sends the case immediately to court.
This is the most important point. The case comes to court, and there is this rambling on, with multiplication of documents, many of which are irrelevant. There is nothing like the attitude of somebody who is inexperienced: "Put the document in; it may be relevant. It can't do any harm. We can be criticised only if it is not put in". Voluminous documents accumulate right up to the moment of trial, as the report says. Very often from both the prosecution and the defence point of view the matter is an absolute mess. It goes to leading counsel on both sides and they have to rummage through all these complexities, sometimes at only a few days' notice. People then wonder why the case is presented with a great deal of time wasted and with a great many corrections, as I, with my limited experience of these matters, have seen and heard.
One comes to this conclusion. As my noble and learned friend Lord Elwyn-Jones emphasised, modern methods should be pursued of evidence being translated into the court in a way which makes the matter clear by very vision, even to those not well versed in such matters. In the preparatory proceedings
66
which the report recommends schedules should be drawn up under the proper surveillance of a judge and leading counsel concerned in the case, or even junior counsel. If all this is put in order, the issues can come before the court and will have been sorted out beforehand.
I shall not deal with whether the defence case ought to be revealed; I do not wish to take up your Lordships' time on that point. But the prosecution case should be clearly put in a statement that is agreed with the judge, and witnesses should be related to that case. In that situation we may not have to worry about the complexities before a jury. The jury may well understand the case perfectly well. It is largely because of the jungle which the jury cannot see their way through that the use of a jury is questioned.
Is it not therefore sensible to see how the reforms so well recommended by this businesslike committee simplify and clarify complex fraud cases (and we are dealing in this instance only with complex fraud cases) before we take not the bull but, as the noble and learned Lord the Lord Chancellor, would prefer to say, the sacred cow by her horns? She is a sacred cow worshipped not by idolators but by those who have a respect for history and who think that they are being radical and liberal when they want to preserve the jury system but not when, even in a small amount of cases, they think that that principle should no longer obtain.
Would it not be common sense, without opposition very largely, to get on with simplifying fraud trials and the procedures? We should see that the fraudsters do not get away with it. We should shorten the time, and leave it to experience to see whether cutting out the jury is necessary later on. I have an idea that we shall find that it is not.
7.26 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Glenarthur): My Lords, we have had a most interesting and stimulating debate in which the rather awe-inspiring list of speakers has encompassed great experience of most aspects of the law or of the City. I am glad that it has been possible to give your Lordships the opportunity to discuss the report so soon after it was published; exactly one month to the day, I believe.
The debate has also given us the opportunity to hear two fine maiden speeches. The noble and learned Lord, Lord Griffiths, with his considerable experience at the Bar and as an eminent judge, has spoken with great wisdom and feeling on the matters of delay, resources, preparatory hearing and rules of evidence. We all have great respect for his views. We shall take careful note of them, and I shall comment on some of the points that he made in a moment or two.
Likewise, the noble Earl, Lord Buchan, made a short but forceful and effective contribution on committal proceedings and trial by jury. He brings his experience as a magistrate to bear on this difficult topic, and I am most grateful to him for what he said. I congratulate both noble Lords most warmly. I am sure that I speak for all your Lordships when I say that we look forward to their further contributions, I hope not too far in the future.
We have had the benefit, as one would expect, of an excellent speech from the noble and learned Lord,

67
Lord Roskill. He set in context, with great clarity, his approach to the difficult task that he and his committee were asked to undertake. He explained why his committee had arrived at certain conclusions. Who better than the noble and learned Lord to answer some of the points of detail that were raised, particularly in explaining to the noble Lord, Lord Wigoder, the committee's views on the difficult matter of statistics.
Individual recommendations of the committee may have found favour or criticism, and even trenchant criticism from the noble Lord, Lord Hutchinson of Lullington, which I thought was slightly ungenerous. However, there was wholehearted and unanimous agreement on the excellence of the report itself. I should like to add my personal congratulations and those of the Government to the many plaudits already offered to the noble and learned Lord, Lord Roskill, and his committee today. If the investigation, prosecution and conduct of complex fraud trials were as methodical, as careful and as constructive as this report which examines them, and the paper work that it all leads to as readable, we could all sit back with some complacency.
But, as this report makes clear without equivocation, matters are not so well ordered. The Government's job is to respond to this report in such a way that fraudsters will know that they cannot take advantage of loopholes or congestion in the criminal justice system. As my noble and learned friend the Lord Chancellor made clear in the statement following publication of the report, our commitment to act is not in question. He said then:
"We fully share the committee's concern that the perpetrators of serious fraud should be brought effectively to book. The report shows that the legal and administrative machinery for this purpose has been creaking badly. We are determined to bring about the changes in law, practice and attitudes which are necessary".
I hope that your Lordships will agree that the appointment of this committee, which has now reported so effectively, demonstrated the Government's view over two years ago that the complex issues surrounding bringing fraudsters to justice had to be systematically addressed. The committee was thus appointed, under the noble and learned Lord's chairmanship, with terms of reference sufficiently wide to allow it to produce the far-reaching, innovative and comprehensive report which we now have before us.
Before turning to specific points raised in the debate, I should like first to address the simple question which was posed to me earlier by the noble and learned Lord, Lord Elwyn-Jones. Now that the Government have this report, what are they going to do about it? Let me say first what has been done. Recommendation 1 is that the need for a new unified organisation responsible for all the functions of detection, investigation and prosecution of serious fraud cases should be examined forthwith. This examination has already begun under the leadership of my right honourable friend the Chief Secretary. I can assure your Lordships that it will be both brisk and thorough, and that—not surprisingly, given its leadership—it will pay close attention to the proper use of resources in combating fraud. The second recommendation, again referred to by the noble and learned Lord, Lord Elwyn-Jones, is that a fraud commission should be
68
responsible for studying the efficiency with which fraud cases are conducted. I can tell the noble and learned Lord that within the Home Office, and in consultation with others, we are looking closely at the possible functions and composition of an independent monitoring body of this nature. There are certainly considerable attractions in appointing a group of able people to identify particular difficulties or breakdowns in the system which obstruct the fight against fraud; on the other hand, if the criminal justice system is already congested, we must guard against inserting any additional tier or a mechanism which might be more cumbersome than effective. On this recommendation, as with many others, we want to be clear about our objectives so that we can best assess how to achieve them.
Broadly, I think our objectives must be, first, justice, and second, efficiency. The two of these should go together and indeed both are happily combined in the Magna Carta reference quoted in the report,
"to no one will we sell, to no one will we deny or delay, right or justice".
But sometimes mechanisms which can be accused of delay or abuse are there to contribute to the interests of justice. That is where our consideration of reform must be most cautious. We shall pay close attention to these matters—most particularly, as the parliamentary statement following publication of the report made clear—on fundamental questions such as those affecting the system of jury trial, to which I shall return in a moment.
There are many other recommendations too, which properly fall to be tested on the touchstones of justice and efficiency. Considerable enthusiasm has been expressed for the proposed reforms to criminal procedure and the rules of evidence. The Government welcome the comprehensive and at times radical approach of the committee and we shall implement in early legislation all the relevant recommendations which we find contribute to the objectives I have mentioned. I have little doubt that the rules of evidence are cumbersome and ancient. We shall do our best to introduce better ones. Indeed, the committee commend what has already been done in the Police and Criminal Evidence Act 1984 and, when considering the case for wider reform, we shall naturally take account of any lessons to be learnt from the early days of that Act.
I turn now to matters raised in the debate. In the time available, I shall do my best to cover as many as I can. I shall certainly study all that has been said, and if I fail to answer any particular points, I shall, of course, deal with those matters in writing. The noble and learned Lord, Lord Elwyn-Jones, raised the matter of the substantive law and the Criminal Law Revision Committee. Following the statement on this report on 14th January, my right honourable friend the Home Secretary sought the advice of the Criminal Law Revision Committee on the following reference:
"To review the restrictions on the use of a charge of conspiracy to defraud in the light of the decision in Ayres, to which my noble and learned friend referred, and subsequent cases, and to consider whether these restrictions could be removed without causing injustice to defendants".
We have stressed the urgency of the work and our willingness to take forward any suitable recommendations in next year's proposed Criminal Justice Bill.

69
The Home Office is also in touch with the Law Commission on its general work on the law of conspiracy to defraud. I am sure that the Commission will pay close attention to what the Fraud Trials Committee has had to say on matters of substantive law.
The noble and learned Lord, Lord Elwyn-Jones, the noble Lord, Lord Wigoder, several of your Lordships, and on particular aspects, so far as resources are concerned—to which I shall come in a minute—the noble and learned Lord, Lord Griffiths, raised the matters of preparatory hearings. We are particularly grateful to the committee for the hard thinking that has developed the concept of the formal pre-trial review or "preparatory hearing", to adopt the report's terminology. For some time, and particularly since the most helpful and explicit judgment in the Court of Appeal, we have been looking closely at the practicability of using the stage preparatory to the full trial to clarify the matters of agreement and those in dispute between the two parties, so that the full trial need deal only with the points of substance really at issue. We have noted the remarks made in the case of Hutchinson, and the work done by the same judge in a working party to study improvements that could be made on the preparation of cases for trial.
We now have the Fraud Trials Committee's detailed recommendations. The questions that must be put relate both to principle: is it right and necessary to oblige the defence to outline the case before the trial and to be bound by that disclosure?, and to practice: are there sufficient judges and counsel to follow cases through in the way suggested without delaying other trials too greatly? We are consulting those mostly concerned in these matters. Together with what has seen said today and what will be said in another place, we hope to conclude on the merits of formal preparatory hearings in time to introduce provisions in early legislation, if appropriate. Naturally, we are also looking at whether what is included in respect of fraud should have a wider application, or whether the complexity of major fraud cases makes them peculiarly appropriate to a more formal preparatory stage.
The noble and learned Lord, Lord Elwyn-Jones, and the noble Lord, Lord Wigoder, raised the question of disclosure by the defence. Perhaps I can say that it is not difficult to understand the attraction of Recommendation 58. As the report says, in paragraph 6.73:
"commonsense and the weight of the evidence submitted to us on this issue lead us to conclude that the lack of any obligation to disclose the defence case in outline in advance of the trial is a hindrance to the efficient handling of many fraud cases".
At paragraph 6.72, the report enumerates the likely benefits in terms of shorter, more efficient and clearer trials. The question is whether this recommendation would undermine the right to silence. In the committee's view, it would not. It would remain for the prosecution to prove its case beyond reasonable doubt. It would not be for the defence to disclose the outline of its case until the prosecution case had, so to say, been fixed. The prosecution would therefore not have the opportunity to shift the ground of its case according to the outline provided by the defence.
The Government have not reached a firm conclusion on this matter, or the other closely
70
associated recommendations. The committee makes a strong case for its recommendations on the basis that with proper safeguards there should be no infringement of the right to silence and no resultant injustice to the defendant. We shall examine the report with that in mind.
The recommendations for the introduction of preparatory hearings as part of the trial with the same judge and counsel involved throughout provide for a departure from the present arrangements for the listing of cases and the allocation of judges. The creation of a special system to run parallel to the current arrangements for non-fraud cases would inevitably have considerable administrative implications and could well lead to changes in the ways in which judges were deployed.
In addition, the transfer of cases to the Crown Court by the prosecution would be likely to increase the workload of both High Court and circuit judges sitting in the Crown Court. There are already considerable pressures of work in the Crown Court and further careful consideration will have to be given to the implication that all these recommendations would have on the deployment of judges and the size of the High Court and the circuit benches.
However, it must be borne in mind that an increase in the number of judges, or indeed of experienced counsel, is not something which can necessarily be achieved overnight; and any necessary changes in the deployment of judges would require consultation. But I fully take the point that a formal pre-trial review must have teeth, and that the judge's discretion—whether provided for in statute or available in his inherent discretion—should so ensure.
It was inevitable that two issues should have featured predominantly in this debate: the matter of juries and peremptory challenge. The former was raised by the noble and learned Lord, Lord Elwyn-Jones, and others. We are immensely interested in the committee's proposal that a judge and two assessors, experts in business matters, should replace juries for the most complex fraud trials. But we have not reached a conclusion on this recommendation and we welcome all that has been said today, including the matter of majority or unanimous verdicts, not only here, but in the press and by the public on the possible advantages or difficulties of adopting this proposal.
I should make clear that, while any reduction in the cost and time of fraud trials would be extremely welcome both to the Government and, I imagine, to defendants, practitioners and the judiciary, these considerations do not Outweigh the fundamental concern that the trial must be fair, and the best chances of a sound verdict assured. After the case which the noble and learned Lord, Lord Griffiths, explained with such clarity, upon which the noble Lord, Lord Benson, with his great experience, commented in a moving speech, and indeed the noble and learned Lord, Lord Wilberforce, elaborated even further, I find it hard to doubt that complex, financial transactions may be difficult for jurors to comprehend. Indeed, the Roskill guidelines are constructed to identify only those cases where, and I quote:
"The complexity lies in the fact that the markets, or areas of business, operate according to concepts which bear no obvious

71
similarity to anything in the general experience of most members of the public".
The noble and learned Lord, Lord Wilberforce, and the noble and learned Lord, Lord Denning, gave some dynamic illustrations of how times have changed, how indeed circumstances vary in different parts of the world and how complicated these matters are compared with the kind of things juries used to examine in times gone by.
As my noble and learned friend the Lord Chancellor said earlier, your Lordships are excusable from jury service as of right. However, I myself wonder whether, should I, and indeed any of us, be on a jury, how many of us would be confident that no detail would evade our rigorous scrutiny in a case like this? It seems to me fairly persuasive that those expert in business will be better able than others to understand business jargon and business dealings. But, although there are powerful arguments in favour of Fraud Trials Tribunals, a better comprehension by assessors cannot be the deciding factor any more than can reductions in cost and time of trials. The question is how best the interest of justice will be served.
Do we believe that the innocent may now be convicted because a jury acts on the maxim, "No smoke without fire"? Do we believe that the guilty may be acquitted because a completely bewildered jury should give every defendant the benefit of the doubt no matter how murky his dealings? If, at the end of the day, the real question is whether or not the defendant is dishonest, is that better judged by the standards of ordinary people or by those whose expertise permits them to disentangle exactly which business practices are legitimate and which are not? If the real problem is that the procedural and evidential rules confuse the issue, should we tackle those first, before considering the removal of juries?
Your Lordships will see that there are a lot of questions; and I have no answers.
However, on this point it is right that we reserve our position in order to take full account of what has been said this afternoon including the philosophical points made by my noble friend Lord Morris, and indeed what has been said—and will be said—elsewhere. I only hope to make clear which factors will weigh most heavily. Those are the achievement of fair proceedings and sound verdicts.
On the matter of peremptory challenge raised by many, including the noble and learned Lord, Lord Silkin, once again our statement on this part of the report made it clear that we take careful account of public and parliamentary views on all matters affecting juries. The right of a defendant to challenge jurors without giving reasons is an ancient one and not one which we could discard lightly or in haste. For this reason the Director of Public Prosecutions is already monitoring the number of challenges by both the prosecution and defence, for those cases for which he is responsible—which amounts to all exceptionally serious or difficult cases including major frauds. In our view, the Roskill critique of the use of peremptory challenge and the prosecution right of "stand by" goes further than the fraud trials remit. We therefore propose to consider the issue in the wider context of trials generally. Again we shall consider what has been
72
said today with great care. If, in the light of the committee's arguments and comments upon it we are persuaded that the jury system is being undermined as a result of the way the law is framed, we shall not hesitate to change it at the first opportunity.
The noble and learned Lord, Lord Roskill, commented that he felt that the view had been expressed that Fraud Trials Tribunals might be the thin end of a wedge. I think I said that our position on the merits of the Fraud Trials Tribunal is open. However, I should make it clear that we do not consider this recommendation to have any application wider than the complex fraud cases which the committee had in mind.
Turning now to the question of evidence, the noble and learned Lord, Lord Griffiths, expressed his view on the rules of evidence hoping that changes would be made. The noble Lord, Lord Hutchinson of Lullington, disagreed with him. I have to say that while the noble Lord, Lord Hutchinson, is entitled to his point of view, we most warmly welcome the committee's proposal to reform the rules of evidence. The rules have not kept pace with the use of documents in international business matters whether legitimate or not. Nor indeed have they kept pace with common sense.
For this reason we introduced modest but significant reforms in the Police and Criminal Evidence Act which the Roskill Committee recognises. But they wish to go further. Certainly as a Government we are prepared to develop the committee's proposals within the highly technical area of the law on evidence quickly and with care to bring reliable and relevant matters before the court with the minimum of fuss. Reliability and relevance, I believe, are the key words, and these objectives will steer our policy towards what I hope will be a significant and effective reform. Those terms do not mean, in answer to the noble Lord, Lord Hutchinson of Lullington, that all commercial documents will have a magical status rendering them unchallengeable.
My noble friend Lord Campbell of Alloway particularly referred to the question of fees for barristers. So far as concerns barristers' fees, I understand that litigation is complicated, or rather contemplated (it is probably complicated as well!) and therefore it would not be appropriate for me to comment on the whole matter of whether or not the present regulations have regard to fair and reasonable remuneration.
The noble and learned Lord, Lord Edmund-Davies, raised the important matter of comfort for jurors and the ability for them to be able to spread their papers and consider carefully all those aspects. I am advised that modern court building schemes make better provision for the comfort of jurors than the traditional courts. Court design standards take account of the needs of jurors to consider documents, and also of course provide superior facilities for them when they retire to consider their verdict. I shall look at the matter a little further and perhaps reassure the noble and learned Lord in due course.
I am conscious that I am encroaching upon eternity and my noble and learned friend the Lord Chancellor has, indeed, another debate to come. In drawing the debate to a close, I should like in the last minute or so to broaden the context a little and to say that, detailed

73
and comprehensive as it is, the report is but one strand in the Government's fight against fraud, and fraud is but one strand of crime against which the Government and the community must battle.
In the context of fraud, the financial services Bill and additional resources for the Fraud Investigation Group and the Department of Trade and Industry demonstrate our commitment. In the wider context, we cannot place fraud above other evil crimes associated with, for example, drugs or violence. However, without placing fraud on a pedestal of priority, we recognise its particular characteristics; namely, that fraudulent activities are usually covert and that major fraud is highly intricate. If we are to deal appropriately with the mischief—and we are determined to do so—we must look at each of the Roskill Committee's recommendations in the perspective of our fight against crime and the special characteristics of fraud. We must test each recommendation against the objectives of justice and efficiency, and wherever the test is passed, we must act. This, my Lords, we shall do.
Motion, by leave, withdrawn.

Law Reform (Parent and Child) (Scotland) Bill
Brought from the Commons; read a first time, and to be printed.
Protection of Military Remains Bill
Brought from the Commons; read a first time, and to be printed.

Latent Damage: Limitation of Actions
7.53 p.m.
Lord Hacking Lord Hacking rose to ask Her Majesty's Government whether, in response to representations which have been made to them by members of the construction and building industries and others, they are prepared to introduce legislation concerning limitation of actions which, while falling outside the terms of reference and recommendations of the 24th Report of the Law Reform Committee, would produce greater certainty in the law.
The noble Lord said: My Lords, my Question concerns our law of limitations. Those laws have been on our statute book for many years and their purpose is to avoid stale trials—and to encourage early justice—and to protect defendants from civil actions relating to acts committed long ago. The periods of limitation vary according to the cause of the action from three years to six years and in some instances to 12 years.
Our law of limitations has received considerable attention this century, particularly during the past 10 to 20 years. In 1936 the Law Reform Committee reported and that resulted in the Limitation Act 1939. Then there was the Limitation Act 1963 which followed the very tragic case which came before your Lordships' Judicial Committee—the case of Cartledge v. Jopling concerning pneumoconiosis and miners. In 1974 there was published the interim report of the Law Reform Committee concerning personal injuries, and in 1977 the final, and main, Law Reform Committee report was published. In 1980 there was the Limitation Amendment Act which was the product of the Law Reform Committee main report of 1977. The Limitation Amendment Act 1980 was then consolidated into another Limitation Act of 1980.
And now, most recently, the Law Reform Committee under the chairmanship of the noble and learned Lord, Lord Scarman, has produced the 24th report on latent damage. That report was presented in November, 1984. It has not been debated but it has been given early consideration by the Government. Indeed, the noble and learned Lord the Lord Chancellor has intimated the intention of shortly producing legislation seeking to implement its recommendations. I should at this stage like to put on record the personal helpfulness of the noble and learned Lord the Lord Chancellor and the officers of his department in holding extensive discussions concerning the recommendations of Lord Scarman's committee and for recently making available some draft clauses of the Bill.
Therefore, my Question is not directed to the recommendations of the Law Reform Committee or to the Government's proposed legislation. Those matters can be properly dealt with on Second Reading and there are matters which I intend to raise concerning those recommendations on Second Reading when the proposed Bill is taken through the House. My Question is directed to other reforms which could, in my submission, be added to the Government's legislative proposals.
I apologise for detaining the House and for detaining the noble and learned Lord the Lord Chancellor; but there are practical reasons for raising this matter by means of an Unstarred Question. First, amendments tabled in your Lordships' House which do not fall under the preamble of the Bill are not amendments which are readily received by the Government. I understand, however, that if in the House of Commons amendments are tabled which do not fall under the preamble of the Bill, they cannot be taken at all.
It may perhaps be helpful if we have a brief look at the present position of the law of limitations. I direct your attention in particular to the accrual point for those periods of limitation. The general rule is for contract, tort and breach of statutory duty to be based on a six-year period of limitation, although in the case of personal injuries the period of limitation is three years. However, the difficulty is that the accrual point for the period of limitation in contract, tort and breach of statutory duty, concerning the same set of facts, comes at different times. As regards contract, the accrual point of the limitation period is at the breach

75
of the contract. As regards tort, it has to be broken up into two parts. If it is a physical damage case, like damage to a building, the date of the accrual of the action is not when the wrongful act was perpetrated in the building of the building, but when "significant" physical damage took place. That has quite recently been established in the Judicial Committee of your Lordships' House in the case of Pirelli.
However, in the case of economic loss—and there is authority to support this—the accrual point is at the moment the act was taken following the wrongful or negligent advice, and not when the loss was sustained. The relevant case is a solicitor negligent case. As regards breach of statutory duty, the general rule is that it accrues at the date of the breach of the statutory duty. However, when one looks at certain Acts of Parliament—for example, the Defective Premises Act 1972—which concern statutory duties on the builders of dwellinghouses, one finds that in that Act the accrual point is the completion date of the dwellinghouse or of the particular activity under which the subsequent litigation comes.
Therefore, the present position is this. Out of the same set of facts there are three different accrual points for the period of limitation: under contract, under tort and under breach of statutory duty. Not surprisingly, the result of that is to cause uncertainty for both plaintiffs and defendants. There is uncertainty first of all over the accrual point (as I have described) and secondly over the test for physical damage. It has been my experience that the date for significant damage is a difficult one to establish, and requires experts on both sides to give evidence. It is generally a contentious point because usually the plaintiff has brought his action just inside or just outside the period of limitation, and therefore the matter is disputed. There is the calling in of expert evidence and there is the litigation, which, if there was greater certainty in the law, would not be taking place.
These difficulties have been accentuated by the spread in the range of negligence cases. The inevitable result has been an increase in the number of litigations. It is difficult to get the exact figures. His Honour Judge John Newey, who is one of the Official Referees, in a paper read at the annual meeting of the Chartered Institute of Arbitrators in October last year calculated that there had been a 100 per cent. increase in cases taken by the Official Referee's court from the mid-1970s to the early 1980s, and that would be a 100 per cent. increase in the number of cases over a five- or six-year period between, let us say, 1976 and 1982.
More startling figures were produced by the Royal Institute of British Architects in their evidence for the report commissioned by the National Economic Development Office (NEDO). That report came out in September 1985 and has been labelled as the Atkins Report. The evidence submitted by the Royal Institute of British Architects was that notices of claims increased from 200 in 1978 to 500 in 1982. If my arithmetic is correct, that is an increase of some 250 per cent. in four years.
This has placed a considerable burden on the courts but also on the construction industry, its architects and
76
civil engineers. The increasing costs of insurance have also placed burdens on those in practice who have to pay increasingly large insurance premiums, and those who have retired who still carry the risk of actions against them although they have long retired before the action is mounted.
It was within this background that the Law Reform Committee recommended, among other things, two new tests. The first was the knowledge or discoverability test, and the second was the long-stop test. Concerning knowledge and discoverability, the purpose there was to enable plaintiffs who had no means of knowing that they had suffered damage arising out of latent defect to bring their actions within three years, whether they knew or ought to have known that the latent damage had been suffered by them.
Secondly, in the long-stop provision which is the counterbalance on the other side, it is proposed here that there should be a long-stop period of 15 years stemming from the date of the breach of duty.
The result is that, as proposed by Lord Scarman's committee, these tests are running on top of the existing tests that I have just described. Significantly—and this is the important point—in their report Lord Scarman and his colleagues had to concede that they were unable to deal with the problem of differing accrual dates because it was outside their terms of reference. One might have thought therefore that the earlier report of 1977—and it would have been within the terms of reference of that earlier report, which were much wider than the terms of reference for Lord Scarman's report—would have reached a view on this problem. I am afraid to report to your Lordships that the answer is, not so.
It is true that the members of that committee were concerned about the multiplicity of different periods of limitation, but this is a different point. This refers to the length of the period of limitation and not to the point that I am addressing to your Lordships; namely, differing accrual dates.
In that report they signified an awareness of this problem. I quote from paragraph 1.11, which says:
"One relevant factor is that the same incident may give rise to a number of causes of action and it merely causes confusion if they are subject to different limitation periods".
However—and this is as recent as 1977—the Law Reform Committee was unsure of the extent of the problem, and spent some time expressing doubts over the decidendi of the two cases which has recently come before the courts concerning latent damage—and I refer to Anns' case and the case of Sparham-Souter and to paragraphs 2.12 to 2.20 of this report.
It fell to the Law Reform Committee of the noble and learned Lord, Lord Scarman, in November 1984, to highlight this problem. I read the relevant passage from that report, which is to be found in paragraph 4.4:
"In cases involving negligence, a plaintiff's cause of action might accrue at different dates depending upon whether the negligence was in the performance of a contractual duty, or a statutory duty or a duty of care at common law and this can lead to complications. Indeed a single set of facts could in theory give rise to claims for breach of duty under all three heads, with three limitation periods.

77
This situation was criticised by a number of those who wrote to us. Our terms of reference on the other hand are limited to the relatively narrow band of "negligence cases involving latent defects" and we consider that it would be quite inappropriate for us to make general recommendations, applicable for instance in the contract field, in the context of the present review."
That is the stumbling block to which I have drawn your Lordships' attention.
Turning back to my Unstarred Question, I am fully aware of the criteria under which the noble and learned Lord the Lord Chancellor, as I understand it, approaches matters of law reform. Law reform should be true law reform and should be handled with care. There should be consensus. Indeed the noble and learned Lord in this House in the earlier debate said, "Law reform by consent, or not at all". I am aware that the noble and learned Lord believes that it is imperative that the amendments to this Bill should not imperil its passage through this Parliament. I believe, however, that these criteria can be met.
I have been in discussion with members of the construction industry, the Bar and Members of this House. Indeed two Members of this House who unfortunately were not able to stay for this debate, the noble Lords, Lord Mishcon and Lord Campbell of Alloway, have both indicated their agreement with the proposal that I am putting before the House. Therefore all these matters lead me to think that consensus can be reached, and that it would be considered sensible and non-controversial to have a common accrual point for actions in tort, contract and breach of statutory duty.
8.7 p.m.
Lord Lloyd of Kilgerran: My Lords, may I thank the noble Lord, Lord Hacking, for raising these important matters so comprehensively. I can therefore briefly follow his presentation and support the request he is making to the Government to introduce such legislation as would produce greater certainty in the present law relating to limitation of actions, particularly in the areas to which I shall refer.
The implications of the present law relating to limitation and the uncertainty which prevails seriously affect a wide range of operations concerning professional bodies and such members of professional bodies as civil engineers, consulting engineers, architects, designers, even inventors, and certainly constructors, sub-contractors and suppliers. The uncertainties of the law not only affect them in their activities in this country, but they have, and may have, serious repercussions in the highly competitive international field where, for example, United Kingdom consulting engineers have such a high reputation and where small margins make such a difference in obtaining large contracts.
As the noble Lord, Lord Hacking, indicated, this uncertainty of the law presents serious problems for the insurance world, and of course increases the cost of insurance to those uncertain of their future liabilities. As I had the privilege of informing your Lordships in relation to another Bill a few months ago involving the work of United Kingdom consulting engineers, it is worth bearing in mind that the contracts with which
78
consulting engineers, for example, may become involved, involve very large sums indeed, and sometimes of the order of millions of pounds. The competition for such contracts, of course, is great.
On that occasion a few months ago, the Government Minister in the other place was gracious enough, with the assistance of the noble Lord, Lord Skelmersdale, who was speaking on behalf of the Government in the debate in your Lordships' House, to grant an interview at that late stage in the Bill to representatives of the Association of Consulting Engineers and myself. Through him we were able to put points to the Government which produced modifications in the Government's view, in the national interest.
I should like to join the noble Lord, Lord Hacking, in any further discussions about this serious problem which he may have with Government officials or with Ministers arising outside the rather narrow terms of reference of the recommendations in the 24th Report of the Law Reform Committee.
At this late hour I do not propose to go into the details of the arguments which should be put forward about this matter. I therefore hope that the Government will be willing to have further discussions in the national interest to ameliorate the uncertainties in the law which are causing so much anxiety in the areas covered, for example, by members of the Association of Consulting Engineers and other professional bodies. In conclusion, I apologise to the House, and once again to the noble and learned Lord the Lord Chancellor, that, owing to a prior commitment, I may not be able to stay to the end of the debate.
8.12 p.m.
Lord Denning: My Lords, I have been involved in a number of these cases. Quite recently, the law on negligence has been very much extended in relation to latent defects. They arose first before us in a case called Dutton v. Bognor Regis. A lady bought a house which had been recently built, but after some years it began to crack and to fall down. Then it was discovered that it had been built on rubbishy foundations. There was negligence both on the part of the builders and of the inspector of the local authority because he had negligently passed the bad foundations. The Court of Appeal held that not only the builder (I am afraid he might have been bankrupt by this time) but the local authority was responsible for the negligence of its inspector. That was the, first big case putting the liability on the builder and on the local authority. I am afraid that, to their cost, local authorities have been held liable a great deal for the negligence of their inspectors.
A few years later a point arose about how long can one wait until a defect is discovered. Some people said that the cause of action starts when the building is wrongly built and the time is six years from that. The Court of Appeal held that the six years ran not from the date when the negligent work was carried out, but from the date when the householder discovered it or, by reasonable diligence, could have discovered it. That is the Sparham-Souter case.

79
That held ground for a little while until a case called Pirelli carne to our Lordships' House in 1983, when it was decided that that was wrong. The period of limitations starts not from when the fault was discovered. This was the case of a tall chimney which had been built with the wrong material and it had cracked at the top. The person who had it built could not have discovered it as he did not go to the top of the chimney. Nevertheless the House of Lords held that the period of limitation ran from the date when the cracks appeared, not from the date when it was reasonably discovered. In the House Lord Scarman and others said that it was a matter for legislation to put right. That in a way is what is being recommended here.
I gather that the Government are prepared to legislate on the line of the 24th report that the cause of action runs for three years from the time when the damage is discovered or, with reasonable diligence, could have been discovered. That is the law in relation to latent defects against building contractors and local authorities as well.
The terms of reference show that the committee only had to deal with negligence. I go on to the next stage. Against people who were negligent, such as solicitors and architects, in the old days it was said that the action only lay in contract and the cause of action ran from the date of the breach of the contract. Now, after the case of Esso v. Marden, and also in another case of Mr. Justice Oliver, as he then was, it has been held that the injured person can sue either for breach of contract or for negligence. That raised a question: is not the time for breach of contract to be measured the same as if the action is in tort? In other words, I should like this to be permissible to be discovered whatever frame of the cause of action, whether it be in tort for negligence or in contract for breach of contract, or whether for breach of statutory duty when the facts are the same and the damage is the same. The only question is the date from which it should run. It should be the same whatever the form of action. That I gather is what my noble friend Lord Hacking wishes.
We should not confine this legislation to actions of negligence but let it go on to actions for breach of contract or for breach of statutory duty when the underlying facts are the same; that the structure has been badly built or advice badly given. Let the cause of action be the same in every case, and also let us deal with the troublesome point which is being argued out by academic writers. When does the period of limitations run for economic loss? I suggest that it is desirable that the legislation covers the whole field and should not be restricted to negligence.
8.17 p.m.
Viscount Colville of Culross: My Lords, I very much enter into the spirit of the Question asked by the noble Lord. Lord Hacking. I should have thought that s our Lordships would in due course welcome legislation to deal with the 24th report of the Law Reform Committee, if my noble and learned friend the Lord Chancellor brings it forward. I should therefore like to continue the discussion about whether that is adequate
80
to deal with all the problems that arise. I am not suggesting to my noble and learned friend necessarily that new clauses ought to be added to any legislation that he has in mind, because for various reasons that may be difficult. But the noble and learned Lord, Lord Denning, has just given some examples about how the law of limitation has been built up. He referred to case law and to the legislative corrections that were made.
The whole history of the development of limitation takes that form. It has always been narrowly confined legislation that has been introduced to deal with something that was thought not to be fair. Personal injuries were often involved, but on this occasion it is to do with the construction industry in the Pirelli case which evidently had to be put right. If one has a case to do with limitation of actions (it occurs to practitioners as well as those who sit in the Court of Appeal and other courts) it is difficult to explain to clients why it is all so difficult and why one particular cause of action, if one can explain what that is, produces a result in terms of the time within which one can sue which is quite different from another cause of action. I believe that the reason for this is because it has had such a haphazard history in terms of overall consideration. If the plea is either in the form of a consideration for forthcoming legislation or perhaps in wider terminology—and maybe the noble Lord, Lord Hacking, is looking a little further ahead—I should simply support what other speakers have said by one small example which came to me only the other day.
There is a form of building construction claim which arises out of mineral leases. In the old days, this used to arise out of a lease which was made under seal and is probably, or was probably (though not certainly because nobody knows exactly what is the scope of this) something called a specialty. If it was a specialty and it was not covered in any other part of the limitation legislation, the limitation period was 12 years. If it was converted into something else, the limitation period was probably six years.
In the case of these particular covenants to repair damage, it was converted by statute, for various extremely good reasons, into a remedy which is now recoverable as a result of various Acts of Parliament. It is therefore certainly no longer a specialty because it is dealt with in those terms because it is dealt with under other provisions in the Act. Thus, although the nature of the damage is identical and the kind of claim is identical—and I do not suppose that Parliament ever considered the matter for one single moment—merely by transferring it from a contractual agreement, with a document under seal, to a statutory provision, they halved the period of limitation.
It is only an example. I do not expect my noble and learned friend to deal with it at all this evening. However, it illustrates how these matters, not fully pursued by any of the enormously learned committees that have sat upon them, have grown up upon the statute book without a comprehensive look. It is within the terms of the construction industry, as it happens. I dare say there are many other examples outside that, where a number of different forms of action can arise, as has been said, from the same set of facts.

81
If my noble and learned friend the Lord Chancellor, in the course of his consideration of this very short question, can consider whether in due time—and perhaps soon—a rather more general consideration could be given to simplifying the law on the limitations of actions, I think he would make the public very much in his debt. He certainly would make it a good deal easier for lawyers to explain what it is that the law says and why it is sensible that it should say so.
8.23 p.m.
Lord Howie of Troon: My Lords, I must apologise for adding my name to the list very late in the day. I have been in Scotland on urgent family business for the past 10 days and could not be sure that I should be here at all. I apologise to the House for that.
This is a highly legal matter. Much of the discussion which has taken place around this report and this evening has been legal and by lawyers. However, I should like to speak as a civil engineer and reflect for a moment very briefly on how the proposals of the committee impinge upon the construction industry. I want to speak on only one aspect of the report. That is the long stop proposed by the committee, which is said to be a somewhat novel matter in English law. I want to touch on only two points relating to the long stop. These are first certainty, and secondly length of time, which of course is related to certainty.
I am thinking here of certainty not only on the part of the aggrieved person who suffers some defect in a building or other construction, but I am thinking also of certainty on the part of the civil engineer, the architect, the contractor, or any other person involved in the construction industry, who might have been the unwitting cause of the damage. I think certainty in a matter of this kind is something that should be sought after and reached, if that is at all possible.
I am not quite sure, though, that the proposals of the committee are sufficiently certain to satisfy many people in the construction industry. I say it for this reason. The date from which the long stop is to apply, so far as I understand the recommendations of the Committee, is from the date of the breach of duty. I am not at all sure that that breach can be very readily determined in time. There might very well be a considerable argument about when the exact breach took place, whether the breach was a breach of design, for example, which would be early in the state of the building, or whether the breach was in the matter of construction, which would be somewhat later on. There is an immediate and quite obvious area of uncertainty.
It seems to me that that uncertainty could be resolved very readily by adopting the date of the completion of the building or construction as the date from which the long stop would apply. That seems to me to be the most sensible date and certainly the most sure one because the date of completion is a specific day which is specifically certified, and about which there can be no doubt at all. There is no need to have recourse to the courts, for example, to determine when it is. It is exact, it is precise, it is certain.
82
I think that the committee would have been wiser to have adopted the date of completion rather than the date of the breach of duty which it did. I know it considered all these dates and it come to its own conclusion; but I think it should think again, or at any rate the noble and learned Lord the Lord Chancellor should think again.
Going on from the certainty of the date of the long stop, it is worth considering the length of time. The committee has proposed a period of 15 years, which is a fairly lengthy time. It has argued that to take the date of completion, that would make the 15 years even longer if the breach of duty were early in a long construction period. That is so, and there might be a possibility of what the committee calls a very stale case of negligence, if I remember the words properly.
I think that can be overcome by reducing the length of the period from 15 years from the breach of duty, whenever that might occur, to 10 years from the date of completion of the contract, when the building or construction is handed over. I think that would be quite long enough. It would be certain. It would of course be in accord with Continental practice. I think that the committee itself makes that point.
That is all that I wanted to say on this matter at this stage. I hope that the noble and learned Lord the Lord Chancellor will take these comments into account. They come not from a lawyer but from someone versed in the construction industry.
8.29 p.m.
Lord Silkin of Dulwich: My Lords, the House will be grateful to the noble Lord, Lord Hacking, for the useful contribution to discussions on the complex subject of limitation. The problem which he has highlighted is fundamental to the area of consideration of the Law Reform Committee. As I see it, that problem is to achieve a fair balance between the desirability of certainty in the law and the need to do justice to the person who is damaged by somebody else's default.
The committee recognises that if the law is too rigid in its search for certainty, a person who suffers loss through another's negligence may be left without any remedy at all, or with inadequate time to ascertain the facts and to bring proceedings. It was for this reason that the committee recommended that the injured party should be allowed a period of three years from his discovery of the latent defect or from its discoverability, even if the result is to create a degree of uncertainty by extending the period provided for by the present law. Notwithstanding the view just expressed by the noble Lord, Lord Howie, I agree with the committee in adopting that balance. In building cases in particular a local defect such as defective foundations may take many years to appear in the form of visible damage to the building. It will be wholly inequitable for time to run against the innocent owner or that, although he may perhaps be put to great expense, he is deprived of compensation before he knows, or even could know, of the existence of the defect.

83
The noble Lord, Lord Hacking, said in effect, accepting the degree of uncertainty which will necessarily arise from this additional period, let us at least have a certain principle of the point of commencment of the limitation period irrespective of whether the right is founded in contract or in breach of statutory duty. In my view there is very much force in the noble Lord's point.
It is true that, as the committee remarked in paragraph 2.9, no reform of the law can eliminate the factual uncertainties likely to arise in cases of latent damage; but that seems to me to reinforce rather than to weaken the case for seeking to ensure that uncertainties unnecessarily created by the law should be eliminated. Having gone that far in support of the noble Lord, however, I would invite the House to look again at the recommendations in the report on the basis that any change in the limitation structure may affect the general balance of equities.
The report seeks to soften the impact of the additional three-year period recommended by it by introducing a fixed long-stop period of 15 years from the date of the breach of duty. The effect of that would be that a remedy would be barred after 15 years even if the existence of the defect had not yet been discovered and was not yet discoverable. The committee conceded that a long stop of this kind is a relatively novel concept in English law. That is in paragraph 4.10. Indeed they rejected it in respect of personal injury claims. They justify it in this case on the basis that the claim might appear at a date so remote that the defendant would be quite unable to meet the claim either evidentially or financially.
But the unfortunate plaintiff, in consequence, might, through the default of the defendant, be put to very great expense which he the plaintiff, would be quite unable to meet himself. Moreover, the defendant might be in a much better position evidentially to defend himself than would be the plaintiff to prosecute his claim. In those circumstances, one might have expected that the committee would recommend that a degree of discretion be given to the court to decide whether the long-stop period should or should not be extended. If that discretion were given, the period would in any event terminate three years from the date of discovery or discoverability.
The discretion of the court could depend, on the one hand, on the extent to which the defendant would genuinely be disadvantaged by the additional period and, on the other hand, by the degree of hardship that the plaintiff would suffer if there were no extension. The committee, in paragraph 4.19, dismisses this idea quite summarily. They say that the value of a long stop would be lost if there were a discretion to postpone it. I confess that I do not follow that view, and the committee did not elaborate it.
In my view there is a strong case for looking at the possibility of giving the court the limited discretion which I have suggested so as to enable it the more carefully and justly to balance the equities in the particular case. I do not believe that the additional minor uncertainty would create greater unfairness
84
than would be created by a long-stop period which was fixed by law and unchangeable, irrespective of the realities of the factual situation.
It might be said that this point could very well be made irrespective of a point raised by the noble Lord, Lord Hacking. I have to accept that; but if his case is accepted so that there is a fixed starting point irrespective of the nature of the claim then, in my view, the case for allowing a limited discretion at the other end is certainly strengthened. There should, at any rate, not be rigidity at both ends. However, the point that I have made stands on its own. I have conceded that it is not dependent on the noble Lord's contention, and I hope that those considering changes in the law will give it full weight.
8.36 p.m.
The Lord Chancellor: My Lords, I am grateful to the noble Lord, Lord Hacking, for the graceful compliment to myself that he paid at the beginning of his remarks and to all noble Lords who have played some part in this short debate on the Unstarred Question. I confess that during the course of the afternoon, which began for me strictly when the Bishop read the Prayers, it occurred to me to wonder whether I was getting fair and reasonable remuneration for work actually done. But having said that, I will do my best to deal with some of the points raised, although I am afraid not all, because I think they rather indicate the truth of what I was saying in the other debate; namely, the wisdom of the late Lord Campbell that law reform is either by consent or not at all. And there has not been a very great degree of unanimity among noble Lords who have participated.
What I can say—and, of course, I had no notice apart from the terms of the Question as to what I should be asked—is that the only new factor that I can really introduce by way of information to the House (and this is in response to something in the Question as well as in response to what the noble Lord, Lord Hacking, said) is that the Association of Consulting Engineers with a number of other, I am told, learned and professional bodies have already put their points; that they are to meet officials of the Lord Chancellor's department and those of the Environment department with other representatives of the construction industry very shortly, next Wednesday, in fact. The second piece of information I can give is that the Minister for Housing and Construction is having regular separate discussions in addition.
The Bill to which reference has been made is not yet ready. It is likely to be printed during March, which is not very far away, and has not yet been approved in its final form. I do not therefore feel able to unveil the statue while the sculptor is still at work with his hammer and chisel. The problem, as many of your Lordships will realise, to which the Question relates became obvious to me fairly soon after my assumption of office as the result partly of the series of cases referred to by my noble and learned friend Lord Denning and, in particular, the so-called Pirelli case.
After a certain amount of discussion I decided to hand it over to the distinguished Law Reform

85
Committee chaired by my noble and learned friend Lord Scarman and composed of a number of distinguished lawyers, academic, practising and judicial. They reported to me in November 1984 and they reached the conclusion that the present law is just neither to potential plaintiffs nor to potential defendants, and that reform is therefore not only necessary but bound to be in effect a compromise between conflicting interests. They said that in their view the law required reform which will take care of the interests of both plaintiffs and defendants.
My noble friend Lord Hacking asks the question whether I am prepared to introduce legislation outside the terms of reference of the committee. Quite obviously, I am not bound by the actual terms, as the committee was. But equally obviously, any attempt at law reform which has not been previously researched and made the subject of proper discussions and consultation between the interests involved must inevitably result in a botched job, has a poor chance of getting through Parliament and is likely to lead to bad legislation if it does. I must therefore say to the noble Lord that the Bill which I intend if possible to introduce this Session, if not sticking absolutely to the terms of reference, will in fact be founded on the report.
My noble friend's Question relates to representations made to me by members of the building and construction industries, and so did the speech of the noble Lord, Lord Howie of Troon. The answer, strictly, is yes. Of course I listen to everything that is said to me and endeavour to arrive at a just solution; but I do rather wonder why my noble friend Lord Hacking has necessarily singled these out in particular, as if I was not likely to be even-handed in my consideration of the subject—because I must now refer him back to what the Law Reform Committee said. It said that the law was unjust to both plaintiffs and defendants. So, as I shall explain, it is; but there is this difference between potential plaintiffs and defendants.
The members of the construction and building industries, who are singled out in the Question, are, for reasons which I shall explain, mainly potential defendants and therefore on one side of the dispute and, as I shall indicate, only part of one side. They are also extremely well organised and very articulate. The potential plaintiffs on the other hand—that is, the consumers of the services in question—are not organised and not in the least articulate because many of them may not even know that they are potential plaintiffs.They are the potential victims of dry rot in their houses, or of unstable foundations, to use the example given by my noble and learned friend Lord Denning.
Also, I must add in answer to my noble friend Lord Colville of Culross that they can also be persons suffering from medical negligence or from an incompetent document drawn by a poor lawyer which has not yet shown its weakness. They may even be victims of a mistake by the Lands Registry, for which I am responsible, although happily the Lands Registry does have to indemnify people against a defect in title. So if my noble friend asks me the question, "Shall I pay attention to representations by members of the
86
two industries?" the answer is yes. But in singling them out he has in fact singled out for special attention a single group, potential defendants, who are well organised and articulate. That will inevitably place them in conflict with another group, potential plaintiffs, the consumers, who are neither articulate nor organised at all. That would be neither good justice nor good politics.
May I now take the opportunity to elaborate on what I wanted to say? We shall, of course, have plenty of opportunity for discussing this matter when the Bill comes forward, but I think the House is entitled to a short description from me of what the problem is and what the Law Reform Committee propose. The difficulty arises principally from the action in tort for negligence and not from actions for breach of contract or actions for breach of statutory duty; nor, although I have taken on board what my noble friend said, actions on a specialty.
It arises from the fact that the cause of action in negligence arises when the damage is actually done, even though the breach of duty may have been years before, and not when the breach of duty takes place, and even though the damage, when it begins to happen, is not really discoverable at all. In the nature of things, a potential plaintiff cannot tell, until his house begins to tilt, that the foundations are faulty although there may have been some damage done before that, or if he finds an inconvenient right of way that his title is defective; or until a cancerous growth has become patently obvious, that there has been negligent medical diagnosis or treatment.
On the other hand, the architect, the builder, the solicitor or the doctor may be permanently at risk for a breach of duty which he may never have committed—he may be completely innocent—but which, if it has taken place at all, took place so long ago that the evidence available to defeat the claim may have altogether disappeared. The committee say:
"In the Consultative Document our sub-committee suggested that there were two main criticisms of the law as it then appeared. First, it seemed to place an unduly heavy burden on professional advisers who in theory might be open to claims for negligence for an indefinite period of time. In such circumstances the cost of obtaining insurance could be formidable"—
that was the point made by the noble Lord, Lord Lloyd of Kilgerran—
"and there could also be difficulties in obtaining sufficiently comprehensive insurance. Secondly, the sub-committee criticised the law on the ground of uncertainty, in particular the uncertainty as to whether the effect of the Sparham-Souter"—
that is the case referred to by my noble and learned friend Lord Denning—
"and Anns cases was to make the accrual of the plaintiff's cause of action dependent upon the discoverability of the damage".
He may not be able to resist and, if he has insured, because of the uncertainty he may have been compelled to pay a heavy premium. I must add that the uncertainty is increased to some extent by the difference in periods to which reference has already been made, as to differences in the commencement date according as to whether the action is in contract, tort or statutory duty; but I do not think I need elaborate that further.

87
The potential plaintiff is equally in an uncomfortable position because—and I now return to the report:
"The substance of the law is more certain following the Pirelli decision. Unless a building is so defective as to be 'doomed from the start' a plaintiff's cause of action will accrue at the moment that physical damage occurs to it. The element of discoverability has been ruled out as irrelevant in determining when the cause of action accrues. Hence, as soon as damage as a matter of fact occurs, time will start to run in favour of the defendant and six years later the plaintiff's action will be statute-barred. The law has been clarified: but the difficulties of establishing the date of the occurrence of the latent damage—which are difficulties arising out of the facts in each and every case—remain as severe as ever they were. Where there is a disagreement neither a plaintiff nor a defendant can be certain as to this date until a court has ruled on it. The sad truth is that no reform of the law can eliminate the factual uncertainties which are likely to arise in cases of latent damage".
Then they go on to point out that it is unfortunately the case that
"The facts in Pirelli concerned latent defects in a building, but the decision in relation to the law of limitation of actions may extend still further. A significant feature of the modern law has been the extension of the tort of negligence to cover cases other than those of personal injury and physical damage. This extension presents problems in the law relating to limitation. If a solicitor gives his client bad advice and the client acts on it but in the result does not suffer financial loss until very much later, does the cause of action accrue and the period of limitation run from the time when the client acts on the advice or from the time when he first suffers financial loss? It is not much help to the client to be told that the limitation period runs from the date of damage unless it is possible to identify damage and its date. Despite its general application, therefore, Pirelli offers no guidance in solving such problems and uncertainties in the limitation law".
The fact must be faced that any limitation law, in any form it takes, is bound to be arbitrary in its effects, whether it is certain or uncertain and whether there is a period of discretion, such as the noble Lord, Lord Howie of Troon, suggested, or whether there is not. On the expiry of the period of limitation, a potential plaintiff is barred from rights which he could have exercised five minutes before the expiry. On the expiry of the same period a potential defendant is freed from an obligation to which he would have been liable five minutes before. But all systems of civilised law have had, and have, limitation periods of some kind, and most systems of law have different systems, differing according to the type of right or the type of context in which it is exercised. Some give rights to property. Some bar the cause of action. Not a few are the subject of international convention—a point which I shall attack a little later. Some are extensible. Others are absolute.
The report of the Law Reform Committee is based on three intelligible principles which they describe as of critical importance in this branch of the law. The first is that the plaintiff must have a fair and sufficent opportunity of pursuing his remedy. The second is that a defendant is entitled to be protected against stale claims. The third is that uncertainty in the law is to be avoided wherever possible. They go on in a rather melancholy tone of voice to say:
"We would not find any proposal for reform of the law acceptable which failed in any significant respect to satisfy these criteria."
I must say that I agree with that passage.
They then come to the two positive conclusions in relation to latent damage:
88
"In our view, the problem of limitation in 'negligence cases involving latent defects' can be solved by amendment of the existing limitation statute; i.e. the Limitation Act 1980"
—which is of course a consolidation Act—
"We recommend in such cases (i) that the ordinary period of limitation should be subject to an extension which would allow the plaintiff three years from the date on which he discovered or could reasonably have discovered that he had suffered significant damage; (ii) that there should be a long stop which, we suggest, should operate to bar all negligence claims involving latent defects or damage that are brought more than fifteen years"
and here I confirm what the noble Lord, Lord Howie of Troon, said—
"from the date of the defendant's breach of duty."
I admit, of course, that both the three-year period of discoverability in the first and the 15-year period of long stop in the second are open to criticism as being arbitrary. They are arbitrary. All powers of limitation are arbitrary. Those who view the thing from potential plaintiffs' spectacles think that 15 years' long stop is too short and that it should be, say, 20 like many other prescriptive periods in the world. Those who view the thing through the spectacles of potential defendants are equally sure that it is too long for their clients to be at risk and think that the period ought to be 10 years from some commencement date and not 15.
There are two factors which must be borne in mind. The first is the long list of those who gave evidence to the committee contained in the appendix. I counted—I am probably wrong—141 individuals or bodies. Am I to know better than the committee with that body of research behind it, or does the House think it wise to improve on that? In some respects, no doubt, the answer might be yes. In others a more cautious note might seem more prudent, and probably there is a happy mean to be drawn between the extreme on the one side and the extreme on the other.
The second factor, to which I have already adverted, must be borne in mind, and that is the comparative lack of organisation and inarticulateness on the part of potential plaintiffs and the extremely well organised and articulate lobby of potential defendants. How am I to hold the scales equally between these?
The Question also refers to the limitations placed on the committee by the terms of reference. On this the committee had this to say—and I think it needs to be repeated—
"In particular it [the sub-committee] noted that the Committee is not empowered to examine the question of who should be liable in respect of a particular type of loss. In the event a number of those who submitted comments to us did seek to open up this area. Another proposal made by a number of commentators was that there should be a system of compulsory insurance against latent damage during the period of a contractor's liability and that this should be taken into account in the price paid by the purchaser. These ideas, particularly the insurance suggestion, are interesting, and we think it desirable that they should be considered by an appropriately qualified body at some future date."
I am bound to say that, although this is vague, I have to endorse that. Then:
"However, they have very wide implications and we would be travelling far outside our terms of reference if we were to attempt in the present study to explore the field of business and law opened up by such proposals. They are therefore not covered in the recommendations which we make for the reform of the law. We have also refrained from making recommendations for a more general overhaul of the law in respect of accrual of causes of action"—

89
this deals with the point of the noble Lord, Lord Hacking—
"but for a different reason. We are satisfied that the proposals which we put forward for reform by amendment to the Limitation Act 1980 should achieve a substantial improvement in the law and can be enacted without a major overhaul of the law of tort. If a more general survey of the substantive law relating to the cause of action in negligence cases is believed to be necessary, it should be undertaken upon terms of reference not limited to cases involving latent damage."
So I am bound to tell the noble Lord that the prospect of getting a wide-ranging Bill on this range of subjects, or even of limitation, without a further Law Commission or Law Reform Committee report, either this Session or immediately in the future, is fanciful and as a matter of practical politics should not be pursued too far. Apart from anything else, some of our limitations, as I said before, are prescribed by international convention and these, at least, could not be changed unilaterally. Those who wish for a change in the law will I think, in practice, this Session have to be content with the law as it is—I think my noble friend Lord Colville recognised this in part of his speech—or a change in the direction (of course subject to the views of Parliament) on the same broad lines as the committee report referred to in this Question. Therefore, the answer to the noble Lord's Question is: Yes, I will listen to any representations made to me, either from those he names or from others. But, no, I am afraid that I must limit the prospect of legislation this Session more or less to the lines reported on by the committee; otherwise I believe we shall get into one of those treacle seas where law reforms of various attractive appearances are proposed and we get no legislation at all.
House adjourned at nine o'clock.

  BBC AND ITV: ANTI-COMPETITIVE PRACTICES
  BBC AND ITV: ANTI-COMPETITIVE PRACTICES
  NATIONAL HEALTH SERVICE EXPENDITURE
  NATIONAL HEALTH SERVICE EXPENDITURE
  DRUGS: NHS APPROVED LIST
  DRUGS: NHS APPROVED LIST
  MUSEUMS AND GALLERIES: FINANCE
  MUSEUMS AND GALLERIES: FINANCE
  AFRICAN FAMINE: UK AID
  AFRICAN FAMINE: UK AID