Sitting of 23 February 1987

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

    European Air Services
    Mr. Sayeedasked the Secretary of State for Transport what progress has been made, following discussions with his French counterpart, to encourage the further liberalisation of European air services.
    The Parliamentary Under-Secretary of State for Transport (Mr. Michael Spicer): I met M. Douffiagues on 4 February and exchanged ideas for significantly more liberal bilateral air service arrangements. At last week's informal Council of Ministers further progress was made. We made it clear again that we would only be party to an agreement which provided for proper competition between airlines.
    Mr. Sayeed: I congratulate my hon. Friend on the robust action that he is taking, particularly in view of the substantial vested interest. Has progress been made on the introduction of cheaper off-peak fares?
    Mr. Spicer: I thank my hon. Friend for his question. Yes, most of our European partners now seem to accept the principle that airlines should be able to introduce low off-peak fares. The British Government are determined
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    that such fares should not be strangled by absurdly restrictive restraints such as the Saturday night or six-day concession.
    Mr. Carter-Jones: Will the Minister take it from me that we wish him well in his endeavours, but that he needs an awful lot of luck to be successful?
    Mr. Spicer: I thank the hon. Gentleman for his kind words of encouragement.
    Mr. Ward: Is my hon. Friend aware of the difficulties concerning the city of Strasbourg, which is the centre for the Council of Europe and the European Parliament, and, in particular, the apparent attempt by the French to maintain a near monopoly there? Will he press for an improvement in communications with Strasbourg and more allowance for genuine competition?
    Mr. Spicer: My hon. Friend is absolutely right in stressing the role of competition in providing better services to Strasbourg, and indeed, elsewhere in Europe. In view of what my hon. Friend said, my right hon Friend will certainly press even stronger for more competition in air services with France and, indeed, with other European countries.
    Mr. Snape: What has the Minister actually done, which was the point of the question? Whatever he has done, why were we deprived of knowing about it? He failed to hold a press conference at the end of his six-month presidency, which is surely unprecedented with Aviation Ministers.
    Mr. Spicer: The hon. Gentleman has got it wrong again. Of course we held a press conference. The reason was to stress that we have almost total unanimity on access and capacity. The only matter on which we shall have further discussions is fares, and we are getting somewhere on that as well.

    Channel Tunnel
    Mr. Favellasked the Secretary of State for Transport what information he has been given on the levels of employment in Scotland and the north of England which will result from the construction of the Channel tunnel.
    The Secretary of State for Transport (Mr. John Moore): Eurotunnel's contractors, Trans-Manche Link, have already placed orders worth £6·4 million for the first two tunnel-boring machines with James Howden & Co. in Glasgow, and £1·2 million for locomotives with Hunslett Engineering Co. in Yorkshire. Letters of intent placed with these two companies total a further £8·5 million. In all, orders for equipment and materials for Eurotunnel are likely to account for some 7,000 to 8,000 jobs, and orders for British Rail another 2,000 to 2,500 jobs, outside the south-east during the construction period.
    Mr. Favell: Undoubtedly that is good news for the north, but what will be the effect on jobs in the north and in Scotland after the tunnel is opened?
    Mr. Moore: I thank my hon. Friend for his first remark. Of course the effect will depend on the degree to which British manufacturing and commercial industry utilise the tremendous freight advantages in being able to move goods from the United Kingdom into Europe, where about 62 per cent. of our export trade goes. Clearly, for the first time, they will have that unique freight advantage, and I trust that they will benefit from it.
    Mr. James Lamond: I also welcome the Minister's announcement, but will he bear in mind the reservations that have been expressed by many borough councils, for example in the north-west, including my own in Oldham, and their concern that the rail network should be strengthened sufficiently to make it economic to situate industry in that area and thus gain the advantage that will be forthcoming from the rail tunnel?
    Mr. Moore: Of course, I shall take note of the hon. Gentleman's point. He rightly draws attention to the opportunities for companies connected with our goods railway system. However, I know from the hon. Gentleman's point that he will be conscious of the enormous importance to British Rail, and to the northwest and other areas north of Birmingham, of the Channel tunnel development.
    Mr. Meadowcroft: Does the Secretary of State accept that many of us who are in favour of the tunnel on social and political grounds nevertheless have the same reservations about the problems for the north if the development is concentrated on the south-east? Does the right hon. Gentleman further accept that it is important for through running from the north on railway lines across London to be introduced at the same time as the tunnel is opened, rather than for the tunnel to commence operations without through-running trains?
    Mr. Moore: I recognise the great importance of through trains. I recognise the hon. Gentleman's point. I am delighted that he reaffirms his party's support for the Channel tunnel. I hope that he will remember what I said in answer to the question, that the jobs in relation to equipment and materials— all the jobs to which I referred—will be outside the south-east. They will be in the north, where our heavy manufacturing and industrial base is.
    Dr. Godman: With regard to Scotland's involvement, the Scottish Office is to assist financially with the study of the concept of the EuroWest Port. Is it the Secretary of State's intention also to provide some financial assistance for the idea of a EuroWest Port based on the Clyde?
    Mr. Moore: I shall talk to my hon. Friends in the Scottish Office about that point, but we have made it clear time after time that, other than the commercial decisions by British Rail in regard to additional ancillary railway facilities as a consequence of the Channel tunnel, no Government money will be put up for the Channel tunnel. However, I shall certainly look at the hon. Gentleman's specific point about the Clyde.

    British Airways
    Mr. David Marshallasked the Secretary of State for Transport what information he has about the total value of British Airways shares sold in foreign markets.
    Mr. Moore: About £148 million worth of shares were sold in foreign markets, out of a total capitalisation of £900 million.
    Mr. Marshall: As the Secretary of State obviously does not have a clue about the answer to the question that was asked, and in view of massive share trading as a result of the issue being considerably underpriced, how can the right hon. Gentleman guarantee that control of British Airways will not pass to foreigners or even to a predatory competitor foreign airline?
    Mr. Moore: The hon. Gentleman's first statement was total and complete nonsense. The articles require all foreign interests in BA shares to be disclosed to the company. Obviously, a system is already in place. On the hon. Gentleman's second point, I wonder whether he remembers what The Sunday Times said on the day before we priced the issue. The writer said that
    "at 125p, I would be luke-warm",
    and in fact, BA would be worth buying only under 125p.
    Mr. Watts: Does my right hon. Friend agree that many potential foreign investors were disappointed because of the tremendous interest of small investors in this country in British Airways, and that that is a tremendous vote of confidence in Lord King, his directors and all the people who work for British Airways, including many of my constituents, who have made it the most attractive airline investment opportunity anywhere in the world?
    Mr. Moore: I am delighted at my hon. Friend's welcome. He is right. He may not recall the only Labour privatisation, if it can be called that, when in 1977 the Labour Government sold British Petroleum shares to the nation, but they did not offer them to the wider public—20 per cent. of them were placed in the United States and the rest went to United Kingdom institutions. My hon. Friends will all be looking forward to a debate on Labour's transport policy document, "Fresh Directions", to see whether the Labour party will confirm— [HON. MEMBERS: "Hear, hear."] I am delighted. Clearly, one of Labour's Supply days will be used to debate that lovely document. We shall look forward to that occasion.
    Mr. Robert Hughes: Is not the truth that the Secretary of State swithered and dithered over the British Airways flotation, that he could not make up his mind whether he wanted to encourage or discourage the small shareholder and that in the end he panicked and set the price too low, so that he gave away £300 million of public money? If he is relying on The Sunday Times for advice on how to run his Department, no wonder he gets it so abysmally wrong.
    Mr. Moore: I do not think for one moment that the enormous success of the Government's privatisation

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    programme would at any stage be regarded by the public—no matter how it is regarded by the Labour party—as the result of panic. I believe that the reverse is the case. British Airways was one of the more successful privatisations. The 1·1 million shareholders will be very interested to know the Labour party's "Fresh Directions" attitude towards their share ownership. We look forward to hearing the Opposition's debate on that subject.
    Mr. Hayward: Would it not be more to the point to concentrate on those shares that were not sold abroad because the demand in this country, especially from British Airways employees and the small shareholder, was at such a high level that shares were brought back from foreign markets into the British market?
    Mr. Moore: My hon. Friend is absolutely correct to draw attention to the working of the clawback and the fact that 47 per cent. of shares were placed with the employees in the United Kingdom and in the wider individual share-owning market place. I know that my hon. Friend would be happy to remind British Airways employees of Labour's commitment in its new transport document to take back the shares at the issue price. When and how the Opposition do that will be of interest to the employees.

    Coaches (Speed Governors)
    Mr. Heathcoat-Amoryasked the Secretary of State for Transport if he will report progress on the consultations about fitting of speed governors to coaches.
    The Parliamentary Under-Secretary of State for Transport (Mr. Peter Bottomley): The Department has been actively involved in the preparation of a British Standard for speed limiters. We expect to be able to consult interested parties on regulations based on a draft British Standard within the next two months.
    Mr. Heathcoat-Amory: Is my hon. Friend aware that the tachograph record is used on the continent as a way of making on-the-spot speed checks, which is simple and quick and avoids the need for additional equipment? Would that not be a better way of enforcing speed limits for buses and coaches than requiring operators to fit these expensive new fangled speed governors?
    Mr. Bottomley: My hon. Friend will accept that if a speed limiter is in operation there cannot be an offence. It is also worth noting that speed limiters are also required in France. I am advised that by themselves tachographs are not sufficient evidence for a prosecution for speeding.
    Mr. Janner: I recognise the importance of a limit being placed on the speeds of coaches and buses, but do not many of the worst accidents happen at fairly low speeds, well below those speeds which would be achieved through the fitting of governors? Is the Minister aware that in my constituency a child was killed about 10 days ago on a road used by buses, coaches and cars, but where there was an insufficient layby area for coaches to pull in to collect and deliver children? Will he consider all aspects of that matter, including those points highlighted by the Anstey lane disaster?
    Mr. Bottomley: The hon. and learned Gentleman has made a very important point, that 80 per cent. of injuries and deaths on the roads occur in built-up areas where the maximum speed limits applicable in countryside areas do not apply. When my right hon. Friend the Secretary of
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    State publishes the new "Highway Code", he will draw attention to the simple rules that will eliminate virtually all injuries and deaths on our roads. I hope that those responsible for children will ensure that children are under control, and that when they reach the age of discretion they are properly trained. I know that bus and coach drivers will do all that they can to ensure that they do not kill or injure children.
    Mr. Adley: In contradistinction to the point made by my hon. Friend the Member for Wells (Mr. HeathcoatAmory), will my hon. Friend press ahead on that matter as fast as he can? Will he confirm the Government's commitment? Does he share the view expressed by my hon. Friend the Member for Wallasey (Mrs. Chalker) that the driving of some coaches on our motorways is little less than intimidation? Will he confirm that, in addition to governors, seat belts, flammability, and other design features are receiving the Department's attention?
    Mr. Bottomley: Yes, Sir.

    Cycling (Safety)
    Mr. Dormandasked the Secretary of State For Transport if he will convene and attend a meeting of representatives of cycling organisations to discuss safety and related matters; and if he will make a statement.
    Mr. Peter Bottomley: I am looking forward to opening the Conference on International Innovations for Safer Cycling, organised by Southampton city council and the Southampton Cycling Campaign on 23 May as one of the main events of National Bike Week 1987. The Department will be playing a full part in this event.
    Mr. Dormand: I welcome that announcement from the Minister who I know has a genuine interest in cycling. However, as 350 cyclists are killed and more than 6,000 seriously injured every year, is there not now an urgent need to reconsider what must be done in such a serious situation? I am not blaming any particular section of road traffic, but will the Minister consider three aspects of the problem? First, will he attempt to increase the awareness of motorists about cycling? Secondly, will he improve facilites for cyclists at turning places and crossing points? Finally, and this is important, will he institute a major campaign among school children about cycling and safety?
    Mr. Bottomley: I pay tribute to the work done for cycling by the hon. Gentleman, not only among Members of Parliament, but throughout the country. He rightly emphasises three aspects. I will do what I can on training, but will require much help from schools, local authorities and the Royal Society for the Prevention of Accidents. The hon. Gentleman will be aware of the advisory leaflets produced by the Department, which have been well received in cycling circles. As for awareness, I hope that when the new "Highway Code" is issued on 4 March the hon. Gentleman will welcome many of the changes, most of which are addressed not to cyclists but to others road users who cause so much danger to cyclists.
    Mrs. Virginia Bottomley: My hon. Friend will be aware that the headquarters of the Cyclists Touring Club is in my constituency—[Interruption.]
    Mr. Speaker: Order. I want to hear about the Cyclists Touring Club.
    Mrs. Bottomley: Before attending any meeting, will my hon. Friend read the club's 1987 manifesto, which was prepared for this European Year of the Environment? What has he done during the past year to publicise the fact that motorists and cyclists are fellow and responsible road users?
    Mr. Bottomley: I recall an Adjournment debate introduced by my hon. Friend, which was answered by my hon. Friend the Minister of State, Foreign and Commonwealth Office, the former Minister of State, Department of Transport, following which we made 18 changes to the "Highway Code" which provide greater protection for cyclists. I shall consider the CTC '87 manifesto. During the past year, I thought that I earned one brownie point by visiting CTC headquarters with my hon. Friend on a tandem, and I thought that I deserved a second brownie point for not telling the press.

    Light Dues
    Mr. Stottasked the Secretary of State for Transport what is his estimate of the cost to the shipping and ports industries as a consequence of the 14 per cent. increase in light dues he announced on 5 February.
    Dr. Godmanasked the Secretary of State for Transport what representations he has received following the announcement of an increase in light dues.
    Mr. Michael Spicer: Well over 80 per cent. of light dues are paid by foreign registered ships. The proposed increase will result in an additional charge to United Kingdom registered shipping of about £500,000 a year. Light dues impose no direct costs on the port industry. I have received several representations for and against the new charges.
    Mr. Stott: The Minister's reply was extremely complacent. Are he and the Secretary of State aware of the immense damage that the measure is likely to cause to United Kingdom ports and shipping? The British Ports Association estimates that light dues could increase container costs by 50 per cent., add £20,000 to the costs of each ship entering United Kingdom ports, and cost one ship owner £1 million per annum.
    The Minister must be aware that Britain alone in Europe charges shipowners this levy for entering and embarking from United Kingdom ports. The levy is directed at the industry and is one that the industry can ill afford to bear. The Minister should consult the Chancellor of the Exchequer and ask him, if he has money to give away in this year's Budget, to give it to ports and shipping— an important part of British industry— instead of levying this 14 per cent. increase on them, which will cause great damage.
    Mr. Spicer: The increases are necessary to cover costs. Before the hon. Gentleman gets completely carried away, he should remember that since 1981–82 light dues have decreased by 18 per cent. in real terms, even taking into account the new rates. He should further remind himself and some of his hon. Friends that light dues were at their peak in real terms in 1975, after Labour had increased them three times in 19 months by 10 per cent., 12 per cent. and 41 per cent. respectively.
    Mr. Godman: What types of fishing vessels are likely to pay dues in the future? Would it not make much more sense to rescind than to extend light dues to fishing vessels?
    Mr. Spicer: We are considering proposals to extend light dues to some fishing vessels. It follows the inclusion earlier this year of the cost of operating the United Kingdom navigator transmitters in the general lighthouse fund. I cannot discuss the details, because they have not been finalised.
    Mr. Squire: Although I do not endorse the hyperbole of the hon. Member for Wigan (Mr. Stott), will my hon. Friend recognise that there is genuine anxiety in the shipping industry about the effect of light dues? Will he undertake to listen most carefully and sympathetically to any representations that that industry makes to him?
    Mr. Spicer: Of course there are anxieties about increases, even if the charges are coming down in real terms. We shall see whether any restructuring between different types of vessels and what they pay should be undertaken.
    Mr. Wallace: What steps has the Department of Transport taken to set up user consultative committees to extend consultation to people who do not necessarily pay light dues? Will the Minister confirm that light dues are not charged by any of our EEC partners, with the exception of Greece and the Republic of Ireland? Does he agree that if a vessel has a choice between Rotterdam and a British port, Rotterdam is likely to be more attractive because increased light dues will now have to be paid in the United Kingdom?
    Mr. Spicer: We consult all elements of the industry. The cost differential between average ports on the Continent and in Britain is explained by light dues only to the tune of one seventh.

    London Underground
    Sir John Biggs-Davisonasked the Secretary of State for Transport if, when he next meets the chairman of London Regional Transport, he will raise with him the level of services on the London Underground; and if he will make a statement.
    The Minister of State, Department of Transport (Mr. David Mitchell): Yes, Sir. While I am not complacent, I congratulate him on increasing by 3 per cent. in 1986–87 alone the mileage of trains run on the Underground, and on his plans for further increases this year.
    Sir John Biggs-Davison: Is my hon. Friend aware that I am grateful for the interest that he and the chairman are taking in the suffering of my constituents on the Central line? Will sympathetic consideration be given to constructive suggestions which may be made by the Central line users action group and myself?
    Mr. Mitchell: Following a lengthy discussion with my hon. Friend, who raised several matters on behalf of his constituents, I have written to the chairman of London Underground Ltd. about them and I shall be in touch with my hon. Friend. As for the line users' association, of course I shall be happy to convey its views as well.
    Mr. Cartwright: When the Minister next meets the chairman of London Regional Transport, will he bear in mind the thousands of south-east London commuters who would love to have an Underground service about which to complain? How long will south-east London remain the forgotten corner of the city when it comes to the development of the Underground system?
    Mr. Mitchell: London Underground Ltd. is concentrating on improving its existing network and services. The hon. Gentleman may be interested to know that the number of passengers has gone up by 50 per cent. since 1982 to an all-time record and that some £260 million of investment— the highest ever level— will be carried through this year. We should see those improvements through before we undertake a further extension of the system.
    Mr. Dykes: Will my hon. Friend have a word with the management of LRT about the irritating failures of electronic time and destination warning signs, especially on the Northern line? They mostly show flashing correction messages rather than times and destinations.
    Mr. Mitchell: I am grateful to my hon. Friend for drawing attention to that matter and I shall pass it on to the chairman and managing director.
    Mr. Snape: Is the Minister satisfied with the level of service provided by LRT, bearing in mind the number of ticket machines that are switched off or are out of order and the lack of staff issuing or collecting tickets, especially late at night? If there is £20 million to spare in this newly nationalised industry, would it not be better to spend it on providing much needed improvements for passengers who travel on the system than to hand it back to the Government?
    Mr. Mitchell: Ratepayers are well satisfied at finding less than half the sum which the GLC would have required in subsidy to mop up the industry. Neither I nor the management are complacent. There are plans for automatic ticketing to be introduced.

    M6-M61 (M65 Link)
    Mr. Pikeasked the Secretary of State for Transport if he will give the projected date for commencement of construction work on the M65 link to the M6-M61.
    Mr. Peter Bottomley: Time will be needed for design work and the normal statutory procedures, including a public inquiry. Construction could then start in the early 1990s.
    Mr. Pike: Does the Minister accept that his answer is not acceptable to the people of north-east Lancashire? This motorway has the overwhelming support of the people in that part of Lancashire, and we have been arguing the case for it for more than 20 years. We want the motorway to be started by 1990, and we want it to be up to motorway standards.
    Mr. Bottomley: We will do the best that we can. The hon. Gentleman mentioned a 20-year delay. Part of that delay was due to the Labour party halving the money for new national roads between 1974 and 1979. Perhaps in the long-promised Supply day debate on "Fresh Directions" we may hear the Labour party's plans for road spending.
    Mr. Favell: There may be problems in Burnley, but a lot of good work is going on in the north-west. However, what about the A6M? There will be overheating not just of engines but of a lot of people in Stockport if something is not done about that soon. When can we expect the public inquiry?
    Mr. Bottomley: I hope soon to be able to announce the date of the public inquiry. We are considering a large
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    number of representations received since the inquiry into the Denton to Middleton section of the Manchester outer ring road ended in January last year.
    Mr. Straw: Does the Minister not understand that the reason for the inordinate delay in the construction of this link is that the Government cancelled the link altogether in April 1980 and did not restore it until three years later? Is he aware that the result has been to produce major congestion, especially on the northern roads around my constituency and on the road between Blackburn and Preston? Bearing in mind the delays so far, can the Minister give any promise that the work to put this link on to the M61 will be speeded up?
    Mr. Bottomley: We shall do what we can, but I cannot promise to speed things up. The hon. Gentleman referred to what happened in 1980. The reason why a number of schemes were suspended or shelved in 1980 was that the previous Government cut the money but did not cut the number of schemes. We must recognise the need for bet ter roads without covering the countryside with concrete. We want the roads that are necessary for industrial employment and we look forward to Labour party support as we continue to provide such roads. If the Opposition want to offer an alternative agenda, they should put a few sums to it.

    Business Aviation
    Mr. Aspinwallasked the Secretary of State for Transport what facilities exist for business aviation in the south-east area, particularly around London.
    Mr. Spicer: I have recently made visits to seven specialist business aviation airfields in the London area and am confident that the available facilities are well placed to compete in serving a thriving business aviation industry.
    Mr. Aspinwall: Is the Minister satisfied that customs and immigration facilities are adequate at business aviation airfields?
    Mr. Spicer: These matters are primarily for my right hon. Friends the Chancellor of the Exchequer and the Home Secretary. I can confirm that the industry has a unique business user concession providing on-call customs and immigration cover at about 40 small airfields throughout the United Kingdom. These are for United Kingdom and EEC nationals travelling for business purposes. The scheme is under continuous review and improvement, and a further enhancement should be made shortly.
    Mr. Soames: Is my hon. Friend aware that that is perhaps an unhappy answer to a situation that he knows very well is extremely unsatisfactory? Is he aware that no really satisfactory customs and excise facilities exist at Gatwick airport for business aircraft arriving and leaving? Will he take what steps he can to urge his right hon. Friends to ensure that this important service is not neglected?
    Mr. Spicer: I know that the industry would like to have. 24-hour cover at all airports for business purposes, but that would be extremely expensive. I shall, of course, make sure that my right hon. Friends hear what my hon. Friend has said, but I cannot make any promises.

    London Regional Transport (Fares)
    Mr. Greenwayasked the Secretary of State for Transport what was the latest fares increase on London Regional Transport undertakings; what was the increase in 1981; and if he will make a statement.
    Mr. John Moore: London Regional Transport fares increased in real terms by an average of 0·5 per cent. on 11 January. Fares have again been held broadly at their real level following the last fares change under the GLC-controlled London Transport in 1983.
    Mr. Greenway: Through my right hon. Friend, may I congratulate London Regional Transport on that very low increase in fares, which is so much below the level of inflation? May I also invite my right hon. Friend to compare it with the GLC's 100 per cent. increase in London Transport fares in 1982 at the same time as it increased rates by 100 per cent.? Does my right hon. Friend agree that it is to the eternal satisfaction of Londoners that London Regional Transport has been put in charge?
    Mr. Moore: My hon. Friend is quite right. He had experience of the impact of GLC policies on his constituents when they wished to travel. My hon. Friend will be interested to know that Labour's transport policy document "Fresh Directions" offers a GLC-type transport policy if ever we have the misfortune to have the Labour party in government again.
    Mr. Chapman: Will my right hon. Friend confirm that keeping fares broadly in line with inflation, and not ahead of it, has resulted in more people using LRT services, particularly on the Underground, and that that has made it possible for management to provide more services? Surely that is a good thing. Will he confirm that it has also led to an increase in the capital investment programme?
    Mr. Moore: My hon. Friend is absolutely right in all the points that he makes. About 30 per cent. more passenger journeys are now being made than in 1983. In fact, there is a record level of travelling on the Underground. That is a clear indication of the success of these policies.

    Bus Deregulation
    Mr. Beithasked the Secretary of State for Transport when he expects to receive the first report of the research he has commissioned into the effects of bus deregulations in rural areas; and if he proposes to publish the report.
    Mr. David Mitchell: I hope to publish first reports of the studies of selected areas in the summer. All the evidence available so far indicates that the level of rural bus services has been broadly maintained.
    Mr. Beith: In view of that reply, does the Minister not realise that the main bus operator in Northumberland reduced services by 25,000 miles a week in the aftermath of deregulation and that very few of those services were taken up by other operators? Must the public wait for the publication of all this research before some of the gaps are filled, and must people give up jobs because they are unable to get to work in the meantime?
    Mr. Mitchell: Most counties have made such savings by going over to competitive tendering for the provision of
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    socially necessary services and they have adequate resources to provide all the services that are necessary in rural areas.
    Mr. Speller: Is my hon. Friend aware that, contrary to what was said by the hon. Member for Berwick upon Tweed (Mr. Beith), in the west country and in north Devon in particular the deregulation of rural buses has resulted in the appearance of buses where none had been seen for more than a decade and that that has been entirely welcomed by my constituents?
    Mr. Mitchell: I am aware that that is so not just in Devon but in many other parts of the country.
    Mr. Heffer: Is the hon. Gentleman aware that the Crosville bus company, which is responsible for both rural and city bus services on Merseyside, has been purchasing bad second-hand buses from Birmingham which its employees have refused to drive? Is he aware that those workers have been sacked and are now unemployed purely as a result of the Government's deregulation policy?
    Mr. Mitchell: I am grateful to the hon. Gentleman for raising that point. It should perhaps be more widely known that Crosville, having won a large number of contracts that would have provided additional employment at the Love Lane depot, took in 10 second-hand buses which in the previous few weeks had been used on the roads and had been driven in the Birmingham area by Transport and General Workers Union drivers, but that when that opportunity was obtained for Liverpool the men refused to drive the buses. The hon. Gentleman may care to ponder why buses which were perfectly satisfactory when driven on the roads of Birmingham by TGWU drivers should be unacceptable in Liverpool.
    Mr. Robert Hughes: Surely the real evidence shows that there has been a severe disruption of bus services in the rural areas. Will the Minister define what he means by "broadly maintained", and will he now name the selected areas in respect of which the studies will be published?
    Mr. Mitchell: The selected areas in England for the special studies are west Wiltshire, Blackburn, the Medway towns and Nottingham. In Scotland they are parts of the Highland region, north-east Fife, the Dumfries and Galloway regions, parts of Strathclyde and part of Edinburgh. In Wales they are west Glamorgan, parts of Powys and parts of Clwyd. All the evidence so far shows that with minor variations there is broadly the same level of service as before, but with an increasing provision of minibus sevices, which are highly popular.

    Midlands, Regional Airport
    Mr. Roger Kingasked the Secretary of State for Transport what has been the total level of investment in regional airports in the midlands since 1979.
    Mr. Michael Spicer: Capital investment at airports in the midlands since 1979 has totalled more than £80 million. That compares with total capital investment of less than £16 million at all regional airports under the Labour Administration.
    Mr. King: I thank my hon. Friend for that answer. Does he agree that, despite the Opposition's allegation that we never invest any money in our infrastructure, this

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    substantial investment must mean an increase in traffic at those airports? Has my hon. Friend any idea of the present amount of traffic?
    Mr. Spicer: I am happy to tell my hon. Friend that the investment is, as he says, generating valuable new business for the region. At Birmingham airport about 180 direct scheduled services are operated each week to 17 foreign destinations. In 1986 alone, passenger traffic increased by more than 25 per cent. At East Midlands airport about 34 scheduled services a week serve five overseas destinations, and in 1986 traffic rose by 20 per cent.

  ATTORNEY-GENERAL

    Official Secrets Act
    Mr. Jannerasked the Attorney-General what recent discussions he has had with the Director of Public Prosecutions regarding investigations of suspected infringements of section 2 of the Official Secrets Act; and if he will make a statement.
    The Solicitor-General (Sir Patrick Mayhew): The Attorney-General has frequent meetings with the Director at which current investigations and pending prosecutions under section 2 are discussed when appropriate.
    Mr. Janner: Will the Solicitor-General tell the House how many investigations and prosecutions are current at the present time under this awful, intolerable section? Will he also say which is correct—the Prime Minister's letter to me saying that the Government have, in effect, no intention of amending the section or attempting to do so, or the leading article that appeared on the front page of The Sunday Times a week ago, which reported that Ministers had said that the section was to be amended or repealed?
    The Solicitor-General: A total of eight prosecutions or matters are at present under active consideration under section 2 of the Official Secrets Act. The hon. and learned Gentleman will recall that the Government have more than once acknowledged the inadequacies of the Act and sought to introduce amending legislation in the previous Parliament, but it did not find favour. Clearly, whether further legislation is introduced is a matter for my right hon. Friend the Home Secretary.
    Mr. Beaumont-Dark: Does my right hon. and learned Friend agree that although the Official Secrets Act may need amending the growing number of people who are willing to betray their country is a much more important problem?
    The Solicitor-General: My hon. Friend acknowledges, as do the vast majority of hon. Members of this House, that any community needs legislation which effectively protects its secrets. The difficulty is to get legislation which actively, accurately and appropriately balances conflicting interests.
    Mr. Nicholas Brown: Before getting to the question, may I ask the Solicitor-General if he will convey our best wishes to the Attorney-General during his convalescence? We hope to see him back here shortly. [Interruption.] That is not the question. Mild mannered I may be, but not that mild mannered.
    On the more contentious matters, will the Solicitor-General give the House an assurance that the matters
    14
    referred to in Granada television's "World in Action" programme last week about that despicable organisation the Economic League are being investigated, especially the possibility that the league's officials have contravened the Official Secrets Act? Will the Solicitor-General also give us an assurance that there is no political impediment to a prosecution?
    The Solicitor-General: The hon. Gentleman's opening remarks were characteristic of his generosity and were most gratefully received.
    On the second part of the hon. Gentleman's question. the procedures for drawing evidence to the attention of the prosecuting authorities are well understood. As has been made clear by my right hon. and learned Friend the Attorney-General, matters of political partisanship are never taken into consideration.

    BBC Scotland (Police Raid)
    Mr. Dalyellasked the Attorney-General on what date, and at what time, he first became aware of the police search of the British Broadcasting Corporation offices at Queen Margaret Drive, Glasgow, as part of inquiries initiated at his request into alleged breaches of the Official Secrets Acts in relation to a secret defence project.
    The Solicitor-General: On the morning of Sunday 1 February.
    Mr. Dalyell: Has it dawned on the Government that the raid on the BBC in Glasgow was an illegal act? Why do Ministers think that they know better than Professor Robert Black, professor of Scots law at the University of Edinburgh, who has argued convincingly that since a justice of the peace did not sign a warrant it was an illegal act? Why do they think that they know better than Professor Tony Bradley, professor of constitutional law at Edinburgh university and editor of Public Law, who says that the feelings of the victims—in this case, the Foreign Office—had to be taken into account?
    The Solicitor-General: Reluctant though I am to play so tempting a question away into the heather, that is not a matter for the Attorney-General.
    Sir John Biggs-Davison: Might not those who appear to believe in the divine right of investigative journalists reflect on what would have been thought, said and done if pre-war journalists had betrayed the secret of radar?
    The Solicitor-General: My hon. Friend makes an extremely important point. It is all very well for us to pay careful attention—and we need to—to the rights of a free press and freedom of speech, but the need for the United Kingdom to protect its essential security interests tends to receive less vocal support and recognition
    Mr. Alex Carlile: Does the Solicitor-General regard it as satisfactory that the law governing the obtaining of search warrants is different in England and in Scotland, thus enabling the authorities to indulge in the sort of gamesmanship of which we heard in relation to the Glasgow search?
    The Solicitor-General: The hon. and learned Gentleman invites me to stray into matters which are the responsibility of my Scottish colleagues, but it would he wrong for me to do so. It is right that the Act of Union should be respected and that the Scots should continue to be able to have a law of their own.

    Sentencing Policy
    Mr. Greenwayasked the Attorney-General what representations he has received about the use of his proposed powers under clause 29 of the Criminal Justice Bill to refer cases to the Court of Appeal for a review of their implications for future sentencing policy; and if he will make a statement.
    Mr. Peter Bruinvelsasked the Attorney-General what representations he has received in favour of a right of appeal for the Crown in rape cases, where he is of the opinion that (a) a judge has been lenient in his sentence or (b) has not complied with the Lord Chief Justice's guidelines on the subject.
    The Solicitor-General: I have not received any specific representations about the use of the proposed powers under clause 29 of the Criminal Justice Bill.
    Mr. Greenway: Will my right hon. and learned Friend reflect on the victim's position in the recent Ealing vicarage case and in similar cases in which, because the rapist pleads guilty, the full details of the case are not brought out before the judge, the victim's evidence is not heard and the case is thus not open to full assessment by the judge? Does he share my concern that in that situation the judge cannot make a proper evaluation of the mind of the victim and that something needs to be done?
    The Solicitor-General: This is an important point. It is' sometimes said that in making a speech in mitigation the defence counsel may reflect adversely on the character of the victim. If anything is said that the prosecution knows to be misleading, the prosecuting counsel should intervene to correct it to avoid the court being misled. The judiciary will always seek to ensure that any judicial observations are squarely based on fact.
    Mr. Bruinvels: Is my right hon. and learned Friend aware of the completely inadequate sentences being given by certain judges? Is he aware that the average sentence for rape is three and a half years and the term actually served only 20 months? Does he agree also also that if all judges looked at the Regina v. Billam case, useful guidelines would be given. Does he agree that when clause 29 is reconsidered there is a possibility of directly amending any particular ludicrously light and lenient sentence and thus the opportunity to deter other potential rapists from committing such a heinous crime?
    The Solicitor-General: To the extent that there is current public disquiet, it is important that clause 29 of the Criminal Justice Bill should be enacted, and I hope that it will be enacted. Without accepting the adjectives used by my hon. Friend, it is important— I believe that the House shares this view—that the guidelines that have been laid down by the Court of Appeal criminal division should be adhered to and applied by the judiciary.
    Mr. Campbell-Savours: Are there any aspects of the Kincora affair that could be brought to the attention of the Court of Appeal under the proposed powers of clause 29 of the Criminal Justice Bill? Is it not true that the file was given to the Prime Minister on 1 November 1984 by Mr. Wallace and Captain Holyroyd, setting out major allegations about the destabilisation of a Labour Government and the Government of the Irish Republic, but that no action was taken? Is it not about time that the
    16
    Government made a statement so that Parliament can learn the truth? We want to know whether the findings in the report are true or false.
    The Solicitor-General: I find it just as difficult as the hon. Gentleman must find it to see how clause 29 can relate to the Kincora affair. However, active consideration is being given to certain reports that have recently appeared about Mr. Holroyd and Mr. Wallace.

  OVERSEAS DEVELOPMENT

    Sub-Saharan Africa
    Mr. Stuart Hollandasked the Secretary of State for Foreign and Commonwealth Affairs what measures he is taking to seek to prevent the re-emergence of famine in sub-Saharan Africa.
    The Minister for Overseas Development (Mr. Chris Patten): We are working with the Governments of the affected countries, and other donors, including the international organisations, to help cope with the complex problems of famine. We seek to help increase indigenous food production, to prevent desertification, to develop food security and early warning systems, and to ensure that measures to avert famine can be taken swiftly.
    We are also continuing to respond quickly to emergencies. In the past two weeks I have announced more than £3 million for help in Mozambique.
    Mr. Holland: Is the Minister aware that his commitment to Mozambique amounts to only 20p per head of the population? As about 4 million people are threatened with starvation, and given the key strategic role of Mozambique for all the front-line states, why does the Minister not commit at least £10 per head for the famine population—or £40 million—through an income and foreign exchange support programme for Mozambique?
    What steps has the Minister taken, with his right hon. Friend the Chancellor of the Exchequer, on joint international action to write off a major share of the $130 billion worth of debt in the remainder of sub-Saharan Africa—a debt which denies such countries a chance of fighting famine and saving lives?
    Mr. Patten: As the hon. Gentleman should know, we have taken the lead in writing off official aid debts to the poorest countries. We have written off debts to the tune of about £264 million to the 13 poorest African countries. As for our assistance to Mozambique, the hon. Gentleman's views were not shared by Ministers in Mozambique a week ago.
    Mr. Prentice: Given the massive scale of the crisis that has developed in sub-Saharan Africa in recent years, and its likely duration, is there not a strong case for a substantial increase in the aid programme for that region alone, rather than having to help that region at the expense of other poor areas?
    Mr. Patten: I am grateful to my hon. Friend for his support. I know how much he knows about the subject. We are hoping to be able to spend more in sub-Saharan Africa in the coming year. This year we are spending about £570 million in Africa on our bilateral programme alone.
    Mr. Kirkwood: Will the Minister acknowledge that we are talking, not just about the quantity of money, but about the quality of investment? Will he also acknowledge

    17
    the importance of supporting subsistence agriculture? Will he assure the House that the percentage of United Kingdom bilateral aid in that direction will increase?
    Mr. Patten: I certainly agree with the hon. Gentleman about the importance of agriculture and the quality of our programme. I am pleased to be able to say that our bilateral project aid for the renewable natural resources sector rose by 50 per cent. in the five years to 1985 and now stands at £65 million.
    Mr. Dorrell: Does my hon. Friend agree that the worst way of dealing with sub-Saharan Africa is through a programme of indiscriminate debt write-off and undermining the adjustment programme supported by the IMF, as in the policy advanced by the Opposition last week? Would not such a policy be rightly interpreted as a charter for irresponsible Third world Governments, which all observers agree contribute to the lack of development in the Third world? Is it not essential to face the fact that development in the Third world, like economic activity anywhere else, involves difficult and tough choices?
    Mr. Patten: My hon. Friend is entirely right. There was a marked difference in tone between the action programme agreed by the African countries at the end of the United Nations special session last year and the document produced by the Labour party last week. However, if David Blunkett is to be believed, that document was entirely academic.
    Mr. Deakins: Will the geographical redistribution of the British aid effort in the next few years benefit sub-Saharan Africa? In particular, will the countries in the region get an increasing share of whatever that aid budget may be?
    Mr. Patten: That will certainly be my intention over the next year.
    Mr. Sackville: Does my hon. Friend agree that any benefit accruing from overseas aid to Mozambique, Zimbabwe and other African nations will be obliterated by the devastation that will follow a policy of universal sanctions against South Africa?
    Mr. Patten: Yes, Sir.

    Women's Health
    Mr. Simon Hughesasked the Secretary of State for Foreign and Commonwealth Affairs what impact he estimates the appointment of a women's health specialist at his Department will have on project work on women and development.
    Mr. Chris Patten: We believe that the appointment of a new nursing and health services adviser, with particular interest in women's health matters, should further strengthen our capacity to improve the health and wellbeing of women.
    Mr. Hughes: Bearing in mind the Minister's comments when he opened the Overseas Development Administration conference on 2 December, does the appointment of a women's health adviser signify a change of policy within his Department? Can we look forward to much-needed women's educational, economic and agricultural advisers in the near future?
    Mr. Patten: No, the appointment does not represent a change of policy. It represents the reaffirmation of an existing, sensible policy.
    Mr. Squire: Does my hon. Friend accept that all development policies, by definition, affect women? Will his Department continue to consider the impact of such policies on women, without forming separate women's units within the Department?
    Mr. Patten: I totally agree with my hon. Friend. I am against tokenism.
    Mr. Madden: Did the Minister see the article by Mr. Davie in The Observer yesterday? If so, what were his reactions, particularly to the suggestion that more positive help should be given to men and women in the Third world to resolve their problems rather than Western agencies imposing solutions upon them?
    Mr. Patten: I did not read that meaning into the article, but I was impressed by the article, as I am with most of Mr. Davie's articles. I took from the article the important role of non-governmental organisations in the development effort. I am delighted to say that we have spent a considerable extra amount on the joint funding scheme with non-governmental organisations and we intend to increase further the amount that we spend on that scheme in the coming years.

    Medically Qualified Personnel
    Sir David Priceasked the Secretary of State for Foreign and Commonwealth Affairs how many medically qualified personnel are responsible to him in relation to his overseas development responsibilities; and what rank is the most senior of such personnel.
    Mr. Chris Patten: The ODA has two full-time medical advisers on its permanent staff, both of medical officer rank, and a part-time nutrition adviser. One medical adviser post is currently vacant, but will be filled on 2 March. The ODA can also turn for advice to 13 medically qualified lecturers and senior lecturers whom it supports at the Liverpool and London schools of tropical medicine, the University of Edinburgh and the University of London. In addition, the ODA supports more than 80 medically qualified personnel working for Governments or public authorities overseas.
    Sir David Price: Does my hon. Friend agree that one of the best ways in which this country can help the Third world is through medical advice? From the Minister's reply, it is clear that the Department is inadequat:ely staffed with medical practitioners. Should not the Department have at least somebody of under-secretary rank, or preferably deputy-secretary rank? In view of the current problem of AIDS in Africa, we shall soon have to give a great deal of advice. Does my hon. Friend agree that it is a great deal more important to give sound medical advice than to throw a lot of money into the Third world? Will his Department do a bit better?
    Mr. Patten: I do not agree with everything that my hon. Friend has said, but I agree about the importance of our health and population programmes. At present we are spending about £38 million on those programmes. I believe that in those programmes more emphasis should be placed on primary health care. We should, of course, work through multilateral as well as bilateral prograrnmes

    19
    and we look forward to giving more support to the World Health Organisation and the work that it is proposing to carry out in relation to AIDS.

    Women
    Mr. Meadowcroftasked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on his Department's policy towards the role of women in development.
    Mr. Chris Patten: Our policy was set out in the booklet "Women in Development", copies of which are available in the Library.
    Mr. Meadowcroft: Is the Minister aware that the Government's attitude seems rather complacent in view of continuing reports that the position of women in
    20
    development issues is becoming worse, not better? Is he aware that a report to be published on Thursday by War on Want sets out the evidence for this? Will he read it carefully and respond positively to its findings?
    Mr. Patten: I hope that I shall respond positively, but I do not always agree with everything that War on Want says; nor, I think, does the Labour party. I am not complacent. I want to see more women being trained under our own programme. Only about 15 per cent. of places currently go to women. We are talking about how to improve that figure with aid-recipient Governments.
    Mr. Gow: What explanation can my hon. Friend offer for the new-found interest of the Liberal party in women?
    Mr. Patten: After the events of last week, I think that I should be careful about referring to the role of women in politics.

Leyland Trucks—DAF
3.31 pm
Mr. Michael Fallon: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 20, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the financial terms of the proposed Leyland Trucks— DAF joint venture".
I raise this issue at the earliest opportunity since the full details of the proposal became clear and since the publication of the Industry Act order on Thursday night. The matter is specific because it relates only to the joint venture. It is important because it involves several thousand people, 2,000 of whom are to lose their jobs in the industry. It is urgent because, unless the House has an opportunity to debate the joint venture, the proposal will be formalised within the next few days.
The joint venture proposal is one of the largest privatisation measures of this Parliament. Whatever one's views on privatisation, it should not be accepted that the proposal should be implemented without Parliament's endorsement, other than the brief statement which was made last week. If that endorsement is not made, by Executive decision a Dutch company will be given, free of charge and free of debt, substantial public assets and a 23 per cent. share of the United Kingdom market. It will have a virtual monopoly of component supply within that market.
Had that been done by Bill or by order, questions could have been asked about the detail of the proposal, the structure of the board of the joint venture and the obligations on the principals concerned in competitive purchasing. I submit that it would be entirely wrong for such proposals to be enacted without further debate in the House and without Parliament's approval.
Mr. Speaker: The hon. Member for Darlington (Mr. Fallon) asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the proposed financial terms of the Leyland Trucks-DAF joint venture".
I have listened with care to what the hon. Gentleman has said, but I regret that I do not consider that the matter which he has raised meets all the criteria under Standing Order No. 20. 1 cannot, therefore, submit his application to the House.

Personal Statement
Mr. Richard Hickmet: I wish, Mr. Speaker, to withdraw my remarks critical of you which I made last Friday outside the House. I realise now how seriously I have offended you and the House. I wish most sincerely to apologise to you, Mr. Speaker, and to the House for my remarks, which I withdraw unreservedly.
Mr. Speaker: I thank the hon. Member for Glanford and Scunthorpe (Mr. Hickmet) for his withdrawal. I accept fully what he has said.

Points of Order
Mr. Harry Greenway: On a point of order Mr. Speaker. On Friday I sought to table the following early-day motion—
Mr. Speaker: Order. The hon. Gentleman should not read out the motion. I have been informed about it. If the hon. Gentleman is dissatisfied in any way with the advice that he was given by the Table Office—I have not seen the motion, as it was not submitted to me—he should ask the Table Office to refer the matter to me. If he will do that, I shall examine it.
Mr. Kenneth Hind: Further to that point of order, Mr. Speaker. Conservative Members unreservedly accept your ruling on the question—
Mr. Speaker: Order. There is nothing more to be said on that matter.
Mr. Eric Forth rose—
Mr. Speaker: Order. There is nothing more to be said on that matter. I have accepted the apology that has been proffered.
Mr. Forth: It is on a different point of order, Mr. Speaker. I wonder whether you could help the House by making it clear what the position is henceforth with regard to the naming of any hon. Member in any early-day motion. Is it now clear, and is it now your policy and that of the Table Office, that from this point on no early-day motion will be accepted that names in any way whatsoever or attributes to any hon. Member any views, opinions or political positions? Is that now the position?
Mr. Speaker: That is certainly not the position. The normal rules apply as before. The only way in which the conduct of an hon. Member may be criticised is by way of early-day motion. What I hope that the House will accept is that hon. Members will refrain from making imputations of dishonour or disloyal conduct against each other, which we would not allow across the Chamber at Question Time and which I certainly would not wish to see as early-day motions on the Order Paper.
Mr. Forth: Further to that point of order, Mr. Speaker. Is it, then, clear that the attribution of views to an hon. Member is quite permissible and that the association of an hon. Member, where he has taken a position publicly in an early-day motion, is quite acceptable and will be accepted by the Table Office?
Mr. Speaker: I think that the whole House understands exactly what the position is. We have an obligation in the House to uphold the high standards that we have inherited. I hope we shall always do so.
Mr. Andrew Faulds: On a point of order, Mr. Speaker. The matter I wish to raise with you came to my notice only while travelling down this morning, in one of the daily journals—[Interruption.] I realise that the main reading of Conservative Members is Beano, but I was reading one of the quality newspapers in the train this morning. Since it arrived after 12 o'clock I could not raise this matter with you as one of the things that has to be brought to your attention by 12 o'clock. Could you advise the House as to what we can do about a very grave matter indeed? It is now quite clear that the President of the United States intended to kill President Gaddafi—
Mr. Speaker: Order. Among my many responsibilities, that is not one. That was certainly known before 12 o'clock.
Mr. Faulds rose—
Mr. Greenway: On a point of order, Mr. Speaker.
Mr. Faulds rose—
Mr. Speaker: Order. The hon. Gentleman must resume his seat.
Mr. Faulds: I did not know about it until 12 o'clock.
Mr. Speaker: Order. I cannot help that.
Mr. Faulds: Since the Prime Minister—
Mr. Speaker: Order. The hon. Gentleman is setting a very bad example.
Mr. Faulds: She gets away with murder. (See column 161, "Parliamentary Conduct".)
Mr. GreenwayI am most grateful for your advice, Mr. Speaker. I return to the question of the Table Office and the tabling of early-day motions. Having once done that, may I ask you, because I am unclear—
Mr. Speaker: Order. I am not prepared to allow the hon. Gentleman to read out an early-day motion which is not on the Order Paper. That early-day motion was not brought to me for my attention. If the hon. Gentleman wished it to be drawn to my attention he should have said so. I have now said that if he wants to have it drawn to my attention I shall ensure that it is sent to me. I have no knowledge of what it is.
Sir Kenneth Lewis: On a point of order, Mr. Speaker. May I ask whether you can assure the House that the rule which you have applied in connection with recent early-day motions, which is accepted by everybody, will also apply to early-day motions tabled by some people at some time in the past applying to people outside the House who have even less chance to justify themselves than those who are Members of the House?
Mr. Speaker: I am glad to have this opportunity to reaffirm that hon. Members should use with the greatest care their undoubted rights of free speech in naming people outside the House who have no opportunity to reply. Hon. Members should always exercise that right and privilege with the greatest consideration and responsibility.
Mr. Greenway: Further to that point or order, Mr. Speaker. I shall not read out my motion, but I must ask you why an early-day motion submitted by me was altered without reference to you.
Mr. Speaker: I understand that the hon. Member was given certain advice by the Table Office and that he accepted it.
Mr. Greenway indicated dissent.
Mr. Speaker: If the hon. Member did not accept that advice, he should have asked for me to be informed. I was not so informed.
Mr. Faulds: Further to the point or order, Mr. Speaker.
Mr. Speaker: Order. I am not prepared to take it.
Mr. Faulds: The Prime Minister—
Mr. Speaker: Order. I ask the hon. Member to resume his seat.

Sizewell Nuclear Power Station
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Portillo.]
Mr. Speaker: There is great demand to take part in the debate. If the ten-minute limit on speeches between 6 pm and 8 pm or between 7 pm and 9 pm applied today, I would have operated it. I ask hon. Members to be as brief as possible so that as many hon. Members as possible can be called.
3.40 pm
The Secretary of State for Energy (Mr. Peter Walker): I welcome the fact that Parliament will today debate the report produced by Sir Frank Layfield following his inquiry. It is, after all, a debate for which we have had to wait four years since my predecessor made it clear that he appreciated the strength of a case for a debate in Parliament before a decision was taken. I have studied his views on that and very much agree with him. I have therefore decided that, without this becoming a precedent, it would be a good idea for Parliament to have the opportunity to express its views before I make a decision on the report.
I have the responsibility to take a decision on the Central Electricity Generating Board's application to build Sizewell B and today, before making this decision, I shall listen with care to the views expressed in the House. I shall comply with your request, Mr. Speaker, that speeches should be kept to 10 minutes because, although I have the CEGB's application before me. I am unable to express any views on the inspector's report until I make a decision and, for that reason, my role in the debate will be one which I have not previously experienced in my 25 years in the House and one to which I am totally unaccustomed—that of listening and providing no views of my own.
I should, however, like to express my gratitude and appreciation for the work that has been done by the inspector and his staff. The inquiry opened in January 1983 and continued until March 1985, having heard 340 days of evidence. Sir Frank Layfield presided over the longest and most exhaustive planning inquiry in our history and he was assisted by a small secretariat and four skilled assessors. In fact, he and his staff dedicated several years of their lives to a painstaking analysis of the arguments for and against the building of a pressurised water reactor at Sizewell. It took from March 1985 until December 1986 to write the bulk of the report. The report summarised the vast quantity of evidence and it certainly illustrates the depth of this inquiry. Sir Frank Layfield prepared a summary of the report, which hon. Members and the public have found most useful.
I should like also to express one other appreciation. Irrespective of the views which any of us may have of the recommendations or observations in the report, I think that we can agree that Sir Frank has succeeded remarkably in producing a well-written report which made the task of those who had to read the entire report far less of a burden than it would otherwise have been.
Mr. Tam Dalyell: For the purposes of the debate and on a point of fact in relation to the Department of Energy, can the right hon. Gentleman say whether the lowest oil and coal prices which the Layfield committee assumed were likely between 1990 and the year 2000 are higher than those which his Department thinks likely,

27
given the recent fall in oil prices? This is a question about departmental judgment and the answer would help any hon. Members who are called in the debate.
Mr. Walker: I have no intention of commenting or making observations upon that or any other part of the report. I am advised that I should not do so.
Whatever decisions the Government make as to the forms of energy that we shall seek to develop, they are likely to have a profound effect for decades to come. The background to decision-taking on energy matters throughout the world is that this is the first century in which the world has been faced with energy problems. Nobody in the year 1900 would have predicted the quadrupling of the world's population, or the gigantic increase in industrialisation. Virtually all forecasts that have been made throughout this century have had one thing in common, and that is that they were wrong. In the main, they were wrong in underestimating the growth of population and industrialisation. None of us can predict with any certainty changes in population or industrialisation over the coming decades. The experience of this century and the nature of potential worldwide growth in the next century show that Britain and the European Community need to pursue energy policies in whatever form that can meet the potential needs of the future.
I am sure that within the debate there will be mention not only of the contribution that can be made by nuclear energy, if that course is pursued, but of the contribution that will come from other forms of energy, some of which, such as coal, oil and gas, we already possess, and others, such as the sun, the wind, the tides and geothermal energy, into which research has taken place both here and abroad on a considerable scale.
We also need to recognise the important ingredient of improved energy efficiency. In my judgment, an important contribution can be made to assist the balance between supply and demand. I know the interest and knowledge in the House on the diverse aspects of energy. My task today is to listen to the views expressed on both sides of the House during the debate. I hope that it is a debate of high quality in which constructive and creative views are expressed. I can only assure the House that, in coming to my decision, I shall take great care to note everything that is said in today's debate.
3.47 pm
Mr. Stanley Orme: After the Secretary of State's short contribution to the debate, the Government are about to make their most important decision about the future of electricity generation. For eight years, not a single power station has been ordered. On all assessments, the ordering of new capacity must now take place with some degree of urgency. It was with some wonder that in the past we heard from the Government that no decision would be taken on power station ordering until they reached a decision on the proposal to build a PWR at Sizewell. The CEGB itself has got it wrong. It did not anticipate the increased demand for generating capacity. In fact, it went to sleep during the four and a half years of the Layfield inquiry. Now we have had reports that the CEGB requires an urgent go-ahead for new coal-fired stations. To delay further is to create continuing uncertainty in the electricity generating industry, in power
28
manufacturing and in the coal industry. Yet to decide to go ahead with the PWR would be to go into a technological and economic cul-de-sac.
I agree with what the Secretary of State said about the industry and the application of Sir Frank Layfield and his colleagues. But the report is out of date. The inquiry closed in March 1985. Therefore, in over 3,000 pages of the report, there is no reference to Chernobyl. Since March 1985, the prices of oil and coal have altered dramatically. The conclusions reached in the report are based in the main on "substantial elements of judgment." Even without taking latter events into account, my assessment of the report is that the balance of judgment should be not to proceed with the PWR.
Layfield's recommendation to go ahead with the PWR at Sizewell is based on two assumptions concerning estimates of future fossil fuel prices and probabilities of safety. Through no fault of his own, Sir Frank Layfield has been unable to take post-1985 events into account in reaching his verdict. However, the Secretary of State has a responsibility to judge the decision on whether to go ahead with Sizewell B, not merely in the light of the inquiry's findings, but having given due consideration to subsequent events. The economics of nuclear power compared with other forms of electricity generation have come under considerable scrutiny. In his report, Sir Frank Layfield commented:
"The evidence showed that the CEGB had significantly over-estimated the likely future price of both heavy fuel oil and coal."
Sir Frank Layfield considered that an independent view of the cost benefits was so important that he introduced his own assessors, the Cambridge Energy Research Group. It was the group's submission on the then economics of nuclear power versus coal that convinced the inspector that nuclear power was a cheaper option. It is, therefore, of considerable significance that that same group has published an up-to-date assessment of the economic pros and cons. That report takes account of the major changes in fossil fuel prices since the end of the inquiry. The group has used the same formulas as an earlier Nuclear Energy Agency report, but, being a dispassionate observer, it has come to different conclusions. Mr. Evans and Mr. Bullen say in their report:
"The results show that the once prevalent view that nuclear is cheaper than coal cannot now be used as a basis for rational decision making by utilities and Governments. This does not mean that coal represents the cheaper option, simply that the uncertainty is great and that under a broad range of assumptions nuclear power is unlikely to offer substantial economic benefits".
Mr. Michael Fallon: The House should be clear on this point. The right hon. Gentleman says that he opposes the go-ahead for Sizewell. Will he make it clear what the position of a Labour Government will be if Sizewell has been given the go-ahead? Will Labour cancel it? What will happen to people in my constituency who work at Davy McKee, Whessoe, Darchem and Press Construction, which might be working on the project?
Mr. Orme: I shall deal with the hon. Gentleman's valid point.
The National Coal Board's own evidence on future coal prices was generally accepted by Sir Frank Layfield. He was convinced by the NCB at the time, and noted that
"the NCB has used these projections as the basis for its own investment decision making".

29
Since that time the NCB has completely revised its views, and it presented its new projections to the Select Committee on Energy. Since the evidence was presented to the Sizewell inquiry, productivity in the coal industry has increased by 23 per cent. The Central Electricity Generating Board has negotiated a contract with British Coal that provides increasingly cheaper coal for our power stations. There can be no doubt that if the Layfield inquiry were taking place now, different and lower assumptions on oil and coal prices would be used. Assumptions on capital costs would also be different. Sir Frank Layfield accepted the CEGB's assertion that it had got capital costs under control, particularly in relation to Heysham B and Torness. We now know that that is not so. In Heysham B and Torness, as well as every other nuclear power station built in the United Kingdom, there have been substantial over-runs and capital cost increases.
Mr. Gavin Strang: I know that my right hon. Friend may not want to say a great deal about Torness, but will he comment on the fact that there are serious difficulties at Torness in relation to safety, which is delaying the commissioning of Torness? Will he give the House an assurance that we oppose the commissioning of Torness and that a whole host of factors follows from those difficulties?
Mr. Orme: I shall be asking the Secretary of State for a statement on the fuelling of Torness and the problems that have arisen. I assure my hon. Friend that I shall pursue those points.
Mr. Dalyell: Will my right hon. Friend give way?
Mr. Orme: No, I want to continue now.
By the CEGB's own admission, the capital costs have risen by 11 per cent. since it gave its figures to the inquiry and that is even before construction has commenced. The CEGB estimates that the cost to the country is now £1,550 million.
We are dealing with a pressurised water reactor involving imported technology. The design and technology involved in the PWR will not be exportable by Britain. Indeed, the PWR is rapidly becoming out of date technology and the American designers, Westinghouse, are working on an advanced PWR in conjunction with the Japanese.
In the United States, nuclear power is supposed to have been operating on a commercial basis since the early 1960s. However, it still receives a third of all federal subsidies. Last year, Forbes Magazine, the United States financial journal concluded:
"nuclear power is an option nobody in their right minds would now consider seriously."
In this country, we are considering buying an American technology which the Americans have rejected. Since 1973, the United States has been cancelling orders for nuclear power stations, including the Westinghouse PWR, not commissioning them. In fact, the United States has not ordered a new PWR in the past 10 years.
Modern coal-fired stations, however, provide an important export market for the United Kingdom. British design and construction of coal-fired stations leads the world market and a most modern advanced station is currently being built in India and is breaking both cost and lead time estimates. It is vital for our power manufacturing industry that the industry is able to use its newest designs, incorporating techniques for cleaner coal burn, in the
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home market to maintain and expand export potential. Further delays in placing those orders, be they bureaucratic blind alleys or lack of political will, continue to undermine the ability of the power manufacturers to maintain jobs and create wealth for this country.
A similar position exists with regard to the retrofitting of the flue gas desulphurisation in existing coal-fired power stations. Since the Secretary of State for the Environment announced six months ago that a programme of retrofitting was to take place, no action appears to have been taken. Perhaps the Secretary of State can tell us what progress is being made.
It is not simply the power engineering industry that is affected by such decisions. The PWR at Sizewell and the desires of the CEGB to extend that to a family of PWRs throughout the country will have an increasingly detrimental effect on the British mining industry. Britain's mining technology is exported throughout the world. The industry employs more than 80,000 men and women and between 30 per cent. and 50 per cent. of their production is sold abroad because they are able to develop their equipment in the home market. British Coal has operated positive purchasing policies to enable that to happen. Both need to be able to plan ahead. To do that, they need to know that there is an expanding future market for British coal.
The arguments about the jobs potential of Sizewell B are deliberately misleading. We know that coal-fired power stations require more personnel to operate them. We have been told by leading power manufacturers— and I have met many representatives of these manufacturers in recent weeks—by NEI, Babcocks and GEC, that more employment is generated in the construction of coal-fired stations. To increase nuclear power in this country is to displace many thousands of jobs in the mining industry.
The cost to the nation, let alone the social cost to mining communities and others, of further cuts in that industry must be offset against the cost of nuclear power.
Contrary to the Government's propaganda, nuclear power looks increasingly more expensive. That was highlighted by the reports received by many of us this morning from the Council for the Protection of Rural England and the Town and Country Planning Association, among others. How, in those circumstances, can we expect the promised cheaper electricity'?
We have been told to look to France as an example of the fulfilment of that promise. The French electricity supply industry is the only one in Western Europe and the United States to have consistently made a trading loss. The 2 billion francs borrowed for its nuclear power programme has made France one of the heaviest borrowers of foreign exchange in the Western world. But has it provided cheaper electricity for consumers? Between 1975 and 1984, electricity prices in Britain doubled; in France, they trebled.
Mr. Peter Hardy: Does my right hon. Friend agree that Electricil de France is the largest corporate borrower in the world and is largely responsible for the fact that France is the third biggest borrower in the world? That has never been mentioned by the scores of hon. Members who, during the past three years, have been trumpeting cheap French nuclear power.
Mr. Orme: My hon. Friend has underlined graphically the points that I have just made. In France, prices to

31
industry are kept artificially low, but prices to domestic consumers are the third highest in Europe and 17 per cent. higher than the average in the United Kingdom. Let us not follow that example.
The inquiry report dismisses other sources of energy, including combined heat and power and the Severn barrage, as not having reached the stage where they can be considered as alternatives. It is vital to the long-term future of our energy resources that the Government give a higher priority to the development of those schemes. As well as stepping up research into all forms of renewable energy resources, a start should be made to the CHP lead city scheme and to the Severn barrage. I welcome the steps that the Government have taken recently to put more money into the Severn barrage, but we need much more investment in the alternatives.
We have always argued that energy policy should not be based solely on narrow economic criteria. The Government have always argued that that is a sound basis for deciding the future of our energy resources. It would be extraordinary if they did not apply the same stringent balance sheet approach to the nuclear industry as they have consistently applied to mining, steel and shipbuilding.
During the past 30 years, nuclear energy has received a total Government investment more than 40 per cent. greater than that given to coal. But coal and other energy industries must shoulder the burden of their own research and development. Only the nuclear industry has a separate account for part of its research and development, yet, despite the Government's investment, it proposes to import nuclear technology. The construction of the PWR would not only have no economic benefits, it would have serious side effects on jobs in other sectors of British manufacturing, especially in coal mining. On the Government's narrow criteria, the case for Sizewell B is not proven.
But the decision on Sizewell B cannot be based only on those criteria. Having considered the economic case, a judgment must be made on whether the risks involved in an extension of nuclear power outweigh the benefits. Layfield is on less secure ground here, even in his now out-of-date report. At one stage, he comments:
"there is no such thing as absolute safety. Experience has shown that accidents will happen."
As the world knows, accidents can and do happen. Layfield was unable to take into account the ramifications of the Chernobyl incident in the Soviet Union. I must put these points to the Secretary of State, bcause the public are asking questions to which we demand an answer. Has he raised that omission with Sir Frank Layfield? Did he at any time seek a reopening of the inquiry? Has Sir Frank Layfield corresponded with him on this issue and, if so, will he make that correspondence available? It is extraordinary that Sir Frank Layfield should spend four and a half years on a report, yet a major disaster in the Soviet Union is not taken into account by the inquiry. At the very least, the inquiry should have been recalled to deal with that.
I accept that safety in the British nuclear industry is as good as any in the world. Undoubtedly, engineering expertise can minimise the risk, but no superiority of design can write out human error. Sir Frank concluded:
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"the evidence on human factors shows that the effect of human error on safety is potentially large. There are no reliable methods yet for quantifying human error. Research and development work is in progress and some such methods should be devised for use in the future."
Is it not vital that "some such methods" are devised before a judgment is made and that they are not left to some time in the future? The evidence of the Three Mile Island incident, which was studied by the inquiry, only goes to prove that the potential for human error cannot be ignored or shunted aside, but must play a considerable part in reaching a decision.
That is not the only area of safety considerations that the report leaves open-ended or up in the air. No preconstruction safety report has yet been submitted to the Nuclear Installations Inspectorate, despite the fact that the Select Committee on Energy recommended— it was accepted by the Government— that the site licence should be given by the NII before the inquiry. The NII still cannot grant that licence. Layfield recommends that the preconstruction safety report be published. Can the Secretary of State give us any idea— if not today, certainly soon—whether that will be the case, when we might expect it and whether he will make a decision in the absence of such a publication and licence? The House is entitled to that information.
Sir Eldon Griffiths: Those of us who live in the vicinity of Sizewell and have wrestled with the matter would like the right hon. Gentleman's advice on this issue. Since the French pressurised water reactors on the Channel coast could present us with a problem of nuclear safety, how would it reduce the risks of nuclear accident in this country if the Labour party abolished PWR here?
Mr. Orme: Our point is that the PWR has not been constructed in Britain, so if we did not proceed, at least it is an element of safety. Unfortunately, we can do nothing about the French development, but at least we would be drawing to the attention of the world the fact that such a development is unnecessary. In an energy-rich nation such as Britain, it is certainly unnecessary.
Sir Frank Layfield seems to be prepared to leave the decisions on safety to the CEGB and the NII. He places
"great importance on the Nirs role in monitoring the development and implementation of the quality assurance programme for Sizewell B."
But, on the inspectorate's own admission, the business of assessing the safety of new nuclear projects is well behind schedule because it is understaffed. Giving evidence to the Select Committee on Energy in January, Mr. Eddie Ryder, Her Majesty's chief inspector of nuclear installations, said:
"Our priority is the safety of operating installations. For those being designed or under construction we face a choice of reducing our standards or delaying the work. We chose to keep up the standards and delay the new projects."
The question that we must ask the Secretary of State and the Government is why the inspectorate is understaffed at a time such as this when there is public concern.
What steps are the Government taking, prior to making their decision on Sizewell, to ensure that the NII can fulfil its crucial role of monitoring the safety of existing plants?
Layfield makes important recommendations with regard to operator training and safety, military security and increased research into the effects of radiation on the public and workers. He recommends:
"fuel loading shall not start until at least one year after a simulator for Sizewell B has been installed and is ready for use by training operators."

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Such training is obviously necessary, and the fact that it must be done for 12 months will affect the cost. The danger is clear if Layfield accords training such priority. Later, he recommends:
"the Secretary of State for Defence should consider whether there are practicable means of reducing the number of breaches of the Provost Marshal's ban on military flights within a defined air space around the Sizewell site."
Layfield urges:
"the NII should satisfy itself that the possibility of both generators being out of synchronism with each other and with the grid would not give rise to an intolerable risk".
None of those precautions is necessary for a coal-fired power station.
When assessing the evidence of radiological risks to the public and workers at the plant, Sir Frank Layfield recommends further co-ordinated and analysed studies to be made. The inadequate OPCS report, which was put in the Library last week, is an even more convincing reason for the research to be undertaken as a matter of urgency. My hon. Friend the Member for South Shields (Dr. Clark) will deal with that if he catches your eye, Mr. Speaker.
These and the many other recommendations made by the Sizewell B inquiry report must be accepted and acted upon if the Government make the ill-judged decision to proceed.
Would it not be better, safer and more economically sound not to have to pursue these drastic measures? The Government need not pursue them if the political concentration was not to further weaken the markets for coal. All this was before the Chernobyl disaster. How much more stringent would Sir Frank's safety recommendations be if he could take evidence on the effects of that disaster? The Chernobyl accident took place 1,600 miles away and almost 12 months ago, but our farming communities are still suffering the after effects. The world has realised that nuclear power is rightly called an unforgiving technology. To ignore the risks is to ignore the effects on present generations and generations to come.
Sir Frank concluded that Sizewell B should be built only:
"providing that there is expected to be economic benefit sufficient to justify the risks incurred."
Nobody believes any longer that that remains the case.The economics have changed and the probabilities of safety have changed. Public acceptability has certainly changed. In a caveat to his recommendations, Sir Frank Layfield stated:
"consent should not be given for building Sizewell B unless the risk is confidently expected to be at or below a broadly set level of tolerability. The level of tolerability should so far as practicable reflect the public's views".
Out latest estimate of the public's view is that two thirds oppose any increase in nuclear power. The public do not believe that the risks are worth taking.
Mr. Nigel Forman: As the right hon. Gentleman is now talking about nuclear power in general, I wonder whether he could enlighten the House on a related and important matter. What would be the stance of his party, if it came into government, on existing contracts for reprocessing at Sellafield and on future contracts? The House needs an answer to that question.
Mr. Orme: The Labour party has published its policy, which is clear for all to see. We are debating Sizewell B and I am restricting my remarks to that. My party's policy is absolutely clear.
Mr. Forman: Let us hear it, then.
Mr. Orme: The hon. Gentleman can read it. If he does not have a copy, I shall send him one.
On all the criteria—on economic grounds, on safety grounds—the case against Sizewell B is the strongest. For the Government to go ahead would be to fly in the face of all rational assessments of our future needs. We urge the Government to reject the recommendations of the Layfield report. If they decide to go ahead, we shall reverse that decision. To end delays, we will strengthen our electricity generating capacity by giving the go-ahead for a programme of modern, clean coal-fired stations. That is the case that I put before the House on behalf of the Labour party.
Mr. Dalyell: On a point of order, Mr. Speaker. It is a bit churlish to criticise the Secretary of State, because he said that he would listen to the House. My point of order concerns the treatment of the House. Is it not ludicrous to be asked to have rational and informed debate without the latest predictions about 1990 to 2000, which exist in the Department of Energy, and which are substantially different from the projections which Layfield had? I am not blaming the Layfield committee in any way—
Mr. Speaker: Order. That cannot be a point of order for the Chair. I know that the hon. Gentleman is anxious to take part in the debate, and those are just the type of arguments which he should raise if he is called.
4.16 pm
Mr. David Howell: As my right hon. Friend the Secretary of State said, the Layfield report is a painstaking and thorough document. There have been criticisms that its terms of reference were too wide. I do not agree. It is helpful and valuable to have such a comprehensive and detailed report which is such a massively studious and expert document. It provides a good start for the House to hold a debate on this important issue.
The arguments that the right hon. Member for Salford, East (Mr. Orme) advanced have been made informally outside the House and are quite familiar. They are that the Layfield report is outdated, although the right hon. Gentleman acknowledges its thoroughness. He made two groups of charges on that score. One relates to the outcome of Chernobyl and the lessons that we should draw from it, and the other relates to the changed economics, the evolution of oil and coal prices since March 1985, and whether they do not undermine the Layfield arguments in some way.
I should also like to explore a third set of considerations—conservation and other forms of investment and the inevitable inflexibility of huge 10-year investment, during which time many things can change. Before we give this gigantic project an affirmative or negative view, we must understand the advantages and dangers of that inflexibility.
Chernobyl was a major disaster and of extreme concern to the entire human race. It must be understood, however, what we were looking at and what the Russians were dealing with. We were lucky in that my right hon. Friend the Secretary of State had the opportunity of a close examination of the Chernobyl affair and, unusually, the Soviet authorities decided to be extremely explicit and set out the nature of the problem and what went wrong.

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The first point for the House to understand and for the right hon. Member for Salford, East (Mr. Orme) to accept, which I am sure he will, is that in the case of Chernobyl we are looking not at pressurised water reactors but at an entirely different generation of pressure tube reactors, which grew from military developments and were rejected by all Western countries four decades ago. In the Western world there is no civil nuclear reactor in any way related to the technology which the Soviet military authorities used and later handed to their civil engineers to build pressure tube reactors.
As the House now knows, the feature of pressure tube reactors is that they are unstable below 700 MW. The theory of the Soviet authorities was that instructions to human beings were sufficient to ensure that the reactors were never run below 700 MW. That theory with its reliance on human error has never been applied at any point in Magnox or AGR or any other design in the West. In other words, we build nothing like the Chernobyl reactor.
I do not minimise the horror of what happened at Chernobyl, but those who see a comparison between the design of Chernobyl and the design of existing, let alone future nuclear reactors of the kind proposed for Sizewell and possibly elsewhere, are making a comparison between two completely unlike and separate technologies, systems of engineering and scientific patterns of development. That is my view of Chernobyl. It justifies us being concerned about Chernobyl, but it should not lead us to believe that it invalidates the argument for Sizewell.
Mr. Alexander Eadie: I am trying to follow the right hon. Gentleman's argument. He says that the Russian reactor is a different type and that there is no comparable reactor in the United Kingdom. Surely the right hon. Gentleman must agree that one factor emerges—that civil nuclear power is an unforgiving technology. Sizewell B has not yet been built and his argument about it requires a little bit of elaboration. On the one hand we have an unforgiving technology and on the other we have a proposed nuclear reactor which has not yet been built.
Mr. Howell: I do not think that this debate will allow time for the elaboration that all these complex issues require. The technology at Chernobyl grew from a pressure tube military technology of 40 years ago that was abandoned by the Americans, the British and the whole of the West more than four decades ago. The comparison does not stand.
The second major charge laid by the right hon. Member for Salford, East and by many people is not a matter of party politics but one that we must try to examine dispassionately. It is the matter of economics. With the building of more nuclear stations are we heading towards cheaper electricity or will it become more expensive? If that were the case we would be foolish to ask taxpayers to do what business men would not do—invest over 10 years in an enormous project for a lower payback than might be obtained from other kinds of investment.
The first question to be addressed is how much weight we put on the variations in fossil fuel prices. At the time the Layfield committee was set up or even since it concluded the oil price first dropped through the floor and then came roaring up again. No one has the slightest clue about how oil prices will shape over the next five or ten
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years. The oil companies have always been spectacularly wrong. In 1979 they predicted that by now we would have $50 or $60 oil barrels, but we have no such thing. The estimates are heroic but nearly always wildly out or thwarted by events.
To a lesser extent the same is potentially true of coal. In the free market in Rotterdam coal is changing hands for about $30. I think that the CEGB is paying up to twice that to the British coal industry and that price could go higher or lower. With great respect to the right hon. Member for Salford, East one cannot base a technology and commitments that will last 10, 20, 30 or even 40 years on very temporary and largely unpredictable trends in fossil fuel prices.
The reason why I feel confident to recommend that the right hon. Gentleman should ignore those trends is that in a sense his case is in a plate in front of him. There will be more coal-fired power stations. Everyone knows that more coal-fired stations will be built in Britain and all round the world. As long as British coal is competitive with imported coal, is of high quality—which it is— and is mined efficiently—which in most cases it is—there will be an excellent future for the British coal industry, our mining communities and for our deep-mined coal technologists.
When the right hon. Gentleman puts up the case for coal he is not putting down the case for nuclear power. All he is saying, and most people will agree with him, is that we will continue to have a substantial coal-fired electricity generating capacity. The question that he and all of us have to address is how heavily in the 1990s and thereafter do we want to rely for our electricity supply on coal. Do we want the 80 per cent. reliance we have had in the past or have we not learned some bitter lessons from that? Regardless of party, most people would say that we have indeed learned some bitter lessons and that prudence dictates a more balanced electricity generating capacity in future.
We need a certain proportion of nuclear power—possibly somewhat higher than we have now and perhaps nearer the German or Japanese levels, as well as a substantial, efficient coal generating capacity. Oil and natural gas will possibly be burnt in power stations and we may have the more diverse technologies which my right hon. Friend the Minister has mentioned. These will make for a better balanced future generating capacity. Coal has a place in it, but so has nuclear power.
If we are to expand our nuclear capacity somewhat, which is essential, how should we do it? The price tag for the pressurised water reactor is now £1,550 million. I am advised that a second one would not carry launch costs and would be substantially cheaper. I take the view that it could be very much cheaper still. I should not like anyone to attribute to me the view that I endorse all the costs that arise from the CEGB's operations. Britain still builds and operates power stations too expensively.
I am not entirely convinced that a gigantic, centralised organisation like the CEGB is the ideal format for electricity generation for the next 20 years. The Japanese electricity supply industry has 13 per cent. more staff but produces three times as much power for two and a half times as many customers. Perhaps we can get many more efficiencies and larger cost reductions from building the next nuclear power station than the £300 million that has been mentioned.
On the overall economics, it is not possible for the right hon. Gentleman to take the trends of the past two years

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in either coal, oil or natural gas prices and build up a gigantic case for the next 10 or 20 years which says that the Layfield argument is wrong. If we are to have a balanced supply we need more nuclear power. Perhaps not the 40:1 ratio that Layfield recommends, but it is likely that nuclear power stations, if built and operated efficiently, will produce cheaper electricity. If that is true we would be crazy not to have an expanded nuclear element in our power supply.
Finally I should like to speak about the whole question of inflexibility. Is it right for us to go nowadays for giant investments that take 10 years to produce any payback, or should we look at small operations and investments of the kind that are employed in some of the American utilities? They are much quicker to build and because of that can be financed by the private market. There is much less risk involved if, while they are being built, the whole demand pattern changes. There is room for these developments, but they do not exclude further nuclear power. We shall see more 10-hour-a-day gas turbines being built in the United States. They can supplement the base load which has to be provided by nuclear power and coal and will continue to do so.
It is interesting to note how daily electricity demand in Britain has changed even in the past five years. There are now fewer sharp peaks and a greater opportunity, on top of the base load of fixed stations, to have smaller turbines coming into action for about 10 hours a day. I share with my right hon. Friend an enthusiasm for alternatives such as wind, wave and sun power, but they will be unable to provide the 8,000 to 17,000 additional MW about which we are talking for the next 15 years, although they can and should make a contribution.
Perhaps we should have another switching station. I was able to authorise one at Sellindge in 1981. When all the lines are working, that will bring in 2,000 MW a day of French electricity. I do not know what the price is to the French, but it is certainly much cheaper to us. The French have surpluses, and while we should not rely on them for ever, perhaps we should invest another £380 million for those 2,000 MW as that is considerably cheaper than building our own power stations.
When all those things have been done, we shall need very big stations to provide the base load, and I believe that such stations will have to be a mixture of coal and nuclear, whether the industry is publicly or privately owned.
Mr. A. J. Beith: Does the right hon. Gentleman believe that a privately owned and privately financed electricity industry would embark upon the Sizewell project without subsidy or guarantee?
Mr. Howell: I have studied the economics of the Kansai Electric Company in western Japan, which is building something very similar to the Sizewell plant, although with certain elaborations. It is doing so with private finance and without subsidy. Therefore, perhaps our private system could do so as well.
It has been argued that if our electricity supply industry was private it would never again build nuclear, but I do not think that that argument stands up, as many private utilities around the world—although not at present in America—are now doing so.
Nuclear power in the West has proved by its record that it is as safe as most forms of power generation. In fact, it
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is very much safer than many other forms of power generation. It is a sad fact that, tragically, deaths occur in our usually very safe mining industry. It is also a sad fact that hydro-electric dams come to bits and are destroyed. Someone told me the other day that 50 had collapsed in the last 50 years. Therefore, they are not very very safe either.
Of course there are risks. There is no such thing as total safety, but there is such a thing as efficient and total containment of any accidents that occur. I believe that our nuclear industry and nuclear engineers are fully able to deliver that level of safety.
Mr. Tony Speller: Will my right hon. Friend give way?
Mr. Howell: I am just about to finish as I know that many other hon. Members wish to speak.
My conclusion is that while we should be cautious about the economics, it is right to go ahead and build the PWR at Sizewell now. That will give us a better balance, better economics and a safer supply of electricity to old and young, industry and the nation, for many years to come.
4.33 pm
Mr. David Steel: While agreeing with some of the observations of the right hon. Member for Guildford (Mr. Howell) in respect of some of the alternatives that the Department of Energy should be pursuing, I nevertheless flatly disagree with his conclusion. I want to look principally at the economic and safety arguments.
Sir Frank Layfield was asked to make his report on the three principal questions of national policy, the economic benefits of the PWR, and whether it was necessary and whether it was safe. At the time the CEGB argued that its justification for the reactor was largely on the grounds of anticipated cost savings rather than capacity requirements. The board has subsequently changed its position to the one that has just been argued by the right hon. Member for Guildford— that the PWR is required on the grounds of anticipated shortfall in capacity. It bases this change of view on an unexpected rise in electricity demand.
Therefore, in coming to his decision, the Secretary of State must first look at the record of the industry in forecasting demand. I have in front of me the table of forecasts which the CEGB has given to the public from 1967 to 1979 which cover the years 1973 to 1986. I shall not weary the House with all the detailed figures, but throughout that time the CEGB's record on forecasting has contained an average error of 26 per cent. These errors have always been over-estimates in demand. Frankly, errors of that scale make opinion polling look like an exact science in comparison. I do not believe that we can possibly rest our case on the industry's track record in forecasting demand.
The hon. Member for Edinburgh, East (Mr. Strang) mentioned Torness. I took a particular interest in that inquiry because of my constituency interests in that project. In the public inquiry in 1974, the South of Scotland Electricity Board predicted a 6 per cent. growth in demand per annum. By 1980, it was possible to assess just how accurate that had been, and our own Select Committee pointed out that the real figure had been 1 per cent. In response to that Select Committee report, the

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SSEB revised its forward estimates to 1·75 per cent. growth per annum, yet in the six years since then the growth has been only 2·2 per cent. over the whole period.
As parliamentarians we are entitled to say that the industry's forecasting record is not one on which we can possibly base a case for making this investment decision now.
But even if we accept that, contrary to all previous experience, the board has got it right this time, I would still argue that constructing a PWR is a wholly inappropriate response. Load management and electricity-specific energy conservation would reduce demand more quickly than new capacity of any kind could be constructed and at less cost. I was cheered by the Secretary of State's reference to, and acknowledgment of, the scope for still further conservation measures. That is absolutely correct. There is now an abundance of evidence from the United States that this is by far the most attractive priority. More recently, the Norwegian electricity industry has found that it is cheaper to reduce demand than to build new capacity.
Here this House has responsibility, because in my view it is simply the rigidity of the CEGB's statutory basis and its institutional obsession with new power station construction that prevents it from taking full advantage of these opportunities. Were we to change the statutory requirements of the CEGB from providing electricity at the cheapest price to making the most economically effective use of its fuel and capital resources, that would go a long way towards allowing British electricity consumers, both industrial and domestic, access to the benefits that are already available in other countries.
In any case, if new capacity were to be required at relatively short notice, new nuclear capacity is surely the least attractive option. That is particularly true if, as the board is now proposing, that new nuclear option is of a design of which it has no previous experience, either in construction or operation.
I accept the point made by the right hon. Member for Guildford about the prudence in public policy of achieving a variety of supply. That is the basic weakness of the Labour party's case. It wants to take us back to a position in which we are over-dependent on coal production, despite the history of that sector.
Our first national priority should be to implement life extension programmes at some of our existing fossil fuel power stations. If we introduced a programme of rewiring generators, repiping boilers and reblading turbines, the life of those existing stations could be extended, their efficiency and economic performance could be improved, and in our view a regular programme of much-needed employment could be directed to the British electricity supply industry. I am not talking about new stations but about revamping what we have already.
The second priority should be to implement a programme of combined heat and power generation. We should insist that the CEGB implements the provisions of the Energy Act 1983 and allows more privately generated electricity to be supplied to the grid. Nothing so much displays the contempt of the board for the interests of the consumers or the wishes of Parliament as its failure to take advantage of the opportunities that we created by that legislation, or for that matter its current decision to sell off the sites that could be available for combined heat and power. I understand that at present there are 64 disused
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sites, of which 19 have been demolished and 33 are up for sale. Surely, as a matter of national policy we should be arguing that combined heat and power must have a far greater part in our programme.
The right hon. Member for Guildford paid lip service to this, but we are in danger of under-estimating the potential of new energy sources, such as the tidal barrages. As with other major projects, I accept that there must be. environmental impact assessments. These are going on at the moment, especially on the Severn and the Mersey. Their capacity for producing power at low cost, although not admittedly in great volume, could be immense. More important, barrage schemes could and should by now have provided considerable new technology with export potential for this country.
It is only after all those measures have been taken that any new centralised generating capacity of any sort should be considered and authorised as a sensible forward investment. Neither I nor the alliance adopt, a flat earth policy to the nuclear industry. We accept that it is possible that in future an energy gap may come up. That is why we continue to support the industry's research and development. We believe that in the immediate future there is no need for further commercial expansion of nuclear power production. Therefore, we would not proceed with this proposal.
The Layfield report's dismissal of the conservation and combined heat and power arguments is rather cursory. Sir Frank Layfield seems to have wholly misunderstood the attempts that have been made to compare public investment in conservation with that in new supply, regarding the former as some sort of public subsidy. He also assumes that there is no competition for capital and that money is available for any worthwhile investment. It is instructive for the House to note the recent report of the Comptroller and Auditor-General in which he said that energy management schemes in the National Health Service with a payback period of only two years were being stalled for lack of resources. That seems a short-sighted saving within the Health Service.
It is now widely accepted that the Layfield assessments of costs and benefits have been superseded by events since the ending of the inquiry. Although I accept the view of the right hon. Member for Guildford that the changes, for example in coal prices, may be temporary, nevertheless we must look at the balance sheet that was put in the suggested costings in the report as against what has happened since. Changes in the forecast of future coal prices and the rise in the real capital cost of the PWR have transformed a potential net benefit of £500 million over the life of the plant into a potential net loss of about the same range or even up to £1,300 million.
The Central Electricity Generating Board has already agreed that the capital cost has increased by 11 per cent. in a year. That alone, on the Layfield report's calculations, will reduce the economic benefits of the PWR to near zero.
The assumed world coal price in the year 2000 was $75 a tonne, yet British Coal, quite apart from forecasting a world coal price of around $40 a tonne, is also stating its intention not to produce coal at any price above about $60 a tonne. Its plans schedule any pit operating at above that price level for closure. To have one section of our energy industry operating on that assumption while another operates on a much higher long-term price level cannot be right. Surely some judgment must be made by the Department of Energy.

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The report's assumptions acknowledges that there is a one in four chance that the PWR would lose money. I would argue, that on those revised figures, the balance now tips precisely against the PWR when compared with any of the other alternatives, including electricity.
The overwhelming probability is that, even if the PWR were built on time—that is a feat that has not yet been managed for any British reactor—and even if its capital costs do not increase further, contrary to almost any previous experience anywhere else in the world, and its availability over its lifetime is as promised, it will still prove to be a burden and not a benefit to the electricity consumer.
The obvious course that the Government should adopt if they really believe in the economics of the PWR, is to do what they have done with the Channel tunnel and other major developments and that is to say, "All right. Let us invite private participation in the enterprise." The Government put great faith in the market place and the PWR. If the Government had the courage of their convictions, they would let one be the test of the other. [Interruption.] That is not Liberal policy. The Government will not do that either. But if the Government had the courage of their convictions, that is the logic of the case that they would put.
The Layfield report and its conclusions have been rather misrepresented. He says:
"I was not able to base my conclusions on a final safety case for Sizewell B, as none was submitted."
Since the primary purpose of the whole inquiry was to assess the safety arguments and reassure the public, that is a rather startling omission. There were repeated ministerial promises and promises by the nuclear installations inspectorate that the final safety case would be available before the inquiry was completed. Of course, that was not available, and it is still not available.
The question that I hoped that the Secretary of State might have mentioned, although perhaps he will when he replies, is: when will the departmental decision be taken in relation to the forthcoming nuclear installations inspectorate report? I am assuming that no decision will be taken until after that report is received. Yet, we have already been told, and the Select Committee was told only last month, that the nuclear installations inspectorate, as the official Opposition spokesman, the right hon. Member for Salford, East (Mr. Orme), mentioned, has not been fully staffed at any point in the past five years and that it failed to complete the 20-year safety reviews of the magnox power stations on time. Indeed, two of the 24-year-old stations have still not been completed, and the inspectorate has failed to provide the Sizewell inquiry with the assessment of the safety case.
That is an important matter and not one that we can simply shrug aside. It is just as well that we are debating this on the Adjournment and not as a formal motion. I do not see how we could because the House would not be in a position to come to a conclusion until that report was available.
The quotation in the report that particularly worries me is:
"the quantitative assessment of risk from Sizewell B has a high degree of uncertainty".
The report also states that the safety criterion
"has not been fully justified".
Here I come to the Chernobyl question. Since Chernobyl there have been studies in the Oak Ridge laboratories in
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the United States which suggest that we might expect a major accident on the scale of Three Mile Island or Chernobyl once in seven years in western Europe, or once in 15 years in eastern Europe.
What disturbed me most about the Chernobyl episode at the time that the facts and figures came out was that the Soviet scientists and, indeed, Soviet Ministers, had given the figure to the Soviet public at the time of the construction of Chernobyl of the possibility of an accident once in 10,000 years. That was precisely the same figure that was used by the Americans in the case of Three Mile Island. Therefore, despite the complete difference between the two, that I wholly accept, the basic risk figures for those relative populations, with different technologies, were precisely the same basis.
Mr. David Howell: It is not only different technologies. At Three Mile Island no one died. Therefore, there is also a total difference, in circumstance which the right hon. Gentleman should bear in mind.
Mr. Steel: I accept that, but I am talking about risk factors which are a matter of legitimate public concern. The same figure, once in 10,000 years, was given in the Soviet Union and in the United States for entirely different technologies. I have just quoted to the House the latest assessments given by the laboratory in the United States.
We can all argue to what extent we allow risk to the population, but one thing cannot be disputed is that since the Chernobyl incident, the costs built into the project for insurance have multiplied. The estimate I received is of a tenfold increase. That increase has arisen since the Layfield costings were done. Therefore, it is an additional cost factor that must be updated and put into the accounts.
In these circumstances the principal conclusion to which Sir Frank Layfield came was worded somewhat obscurely, or ambiguously. He said:
"there should be good confidence that Sizewell B, if built, would be sufficiency safe to be tolerable, provided that there is expected to be economic benefit sufficient to justify the risks incurred."
I read that statement over arid over again. It is a statement that is in danger of achieving circularity. If it has any meaning it is to suggest that if economic benefits are sufficiently large to justify the risks, the reactor should be sufficiently safe to be tolerable. In other words, some risks are acceptable only if the economic benefits are sufficiently large. If follows that if there are no economic benefits, as I believe, the risks are not tolerable. Since it is now clear that the purported economic benefits will not materialise, had Sir Frank Layfield been aware of the subsequent factors, it is at least arguable that he would have been compelled by his logic to find against the PWR on safety grounds alone.
There have been several questions to the Secretary of State, one only last week from my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith), about the Government's review of emergency and safety procedures in the light of Chernobyl. The Secretary of State answered all those questions by saying that he was still in a quasi-judicial capacity; so could not give the House the information sought. That is a little disturbing, because pre-Chernobyl the United Kingdom's emergency plans provided logistic arrangements to evacuate a maximum radius around nuclear power stations of one and a half miles. In the United States the plans cover a radius of 10 miles. However, in the Soviet Union evacuation of the

43
civilian population had to take place up to 90 miles from the power station. It is important that we know at some time, if it is not possible now, what the Government's revised planning is and what its cost implications are. That, too, is post-Layfield and must be included in the figures.
My colleagues in Somerset county council told me that when they put forward their new emergency plans for Hinkley Point, the CEGB refused to co-operate in extending the area covered by the plans. At some point the Government must make clear their view on that position, and the extra costs involved.
The report has gone some way towards clarifying the public debate about PWR generation. Our alliance parties are certainly not convinced of the case for it on either economic or safety grounds. The disposal of nuclear waste and emergency procedures are far from clear. Therefore, we see no case for ordering Sizewell B nor for proceeding with similar reactors at Druridge bay or Hinkley Point. Given that opposition, my conclusion and advice to the Secretary of State is that it would be highly irresponsible to proceed with Sizewell B in advance of a general election.
4.52 pm
Sir John Osborn: The Sizewell B inquiry has taken an inordinate length of time, but it has achieved two purposes. First, it has dealt with the installation of a PWR, redesigned by the CEGB with safety in mind. It has taken in the lessons of Three Mile Island and the experience of the operation of PWRs in other countries. Secondly, the inquiry has dealt with the suitability of Sizewell B as a site for the first reactor of this type in Britain.
As a member of a Council of Europe committee that has visited installations in France and elsewhere, I have been given the impression that our procedures tend to make us the laughing stock in other countries. Nevertheless, given that we have these procedures, I congratulate Sir Frank Layfield on completing a tremendous, almost impossible, task and on the way in which he has presented his findings. However, I genuinely wonder whether public inquiries of this type are the best way to tackle such difficult, complex technological and environmental issues. I hope that the Government will look into that. I read with interest Sir Frank Layfield's comments on the successor station to Sizewell B.
I spoke in the debate on Chernobyl. At that time the cost of energy to industry and energy strategy seemed vital issues. Indeed, they have been my study and interest. I am well aware that, in the late 1960s and early 1970s when I was a member of the Science and Technology Select Committee under the chairmanship of the late Mr. Airey Neave, it advocated the development of the steam-generated, heavy-water reactor. At that time I was among those who felt that others were too far ahead of this country in the development of the PWR reactor and that Britain should pursue another type. Since then—15 to 20 years ago—the PWR has proved itself.
The public debate on the Chernobyl accident went wider than this country and I have come across it in the Council of Europe. Perhaps the fear is the fear of not knowing what radioactivity is. The challenge suggested at a meeting in Berne was to let laymen know how it is
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measured. Such terms as sieverts and curies mean little to him. The measurement of radioactivity in simple terms so that the man in the street can understand it is a challenge.
My approach to the Chernobyl debate was international. In 1955 I was with the Westinghouse team, admittedly for odd industrial reasons, selling the PWR. That was at the first Atoms for Peace conference in Geneva. Since then a large number of PWRs have been brought into operation throughout the world and 75 per cent. of France's electricity is generated by the PWR. I am certain that the hon. Member for Midlothian (Mr. Eadie) remembers replying to a Western European Union debate for me when I was the rapporteur on the subject of Europe's capacity for building reactors. The trouble is that Britain did not move with the rest of Europe at that time.
There are 318 PWRs in the world. In France there are 43 in operation and 14 more under construction. All this nonsense—to other countries—about Sizewell justifies some of the comment that I have had from those who have led the way. There is the syndrome that nuclear energy, whether nuclear-fired electricity generation or low-level or high-level nuclear waste disposal, is fine but not in one's back garden. I very much hope the Secretaries of State for Energy and the Environment will arrange financial incentives, perhaps for local communities, so that rates are low where people are affected by this problem.
I have been worried about the impact of energy costs in Britain. The National Economic Development Office has been involved and there have been representations from many industries led by Lord Gregson. If energy prices in general and electricity prices in particular are available to our competitive industries at lower prices, because of the reduced cost of production, our industries will be at a disadvantage.
It must be appreciated that the French will have surplus electricity generating capacity which they can produce and sell well below Britain's prices. It alarms me that at present this country wishes to attract melting and smelting from other countries, including the United Kingdom, to France on those grounds. That is an entirely different story from that put forward by the right hon. Member for Salford, East (Mr. Orme).
Mr. Hardy: The hon. Gentleman has made a serious point for our area. Does he accept that the British Government should not sit idly by and see British industrial capacity wiped out because French nuclear electricity prices are so low that we cannot compete? Moreover, they are low simply because the receipts of Electricite de France do not match the loan charges which it must meet.
Sir John Osborn: I thank the hon. Gentleman for his intervention, which was exactly the same as his intervention in the debate on the Second Reading Coal Industry Bill. As the hon. Gentleman knows, I am concerned about the steel industry of the United Kingdom and, specifically, Sheffield. After the announcement of redundancies at United Engineering Steels at Stocksbridge last month I wrote to the Secretary of State for Trade and Industry and the chairman of the Trade and Industry Select Committee asking them to ensure that Britain does not operate at an unfair disadvantage to other countries. I hope that both of them will take up that matter, and I will send the Secretary of State for Energy copies of the correspondence.

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Lord Marshall and others, including successive chairmen of the British Steel Corporation, have said that electric arc steel melting, for instance, let alone other forms of steel melting, have become progressively less competitive because of the high cost of electricity. My theory is that the special steels industry has been too dependent on coal-fired electricity from high cost deep-mined coal, particularly in Yorkshire, and that that has been the real reason for the closures in Sheffield.
Last week Parliament had the privilege of hearing a presentation by Gavin Laird who spoke of the need for a thriving manufacturing sector, for expanding the market for our goods and for advocating new technology. He also reminded us that today Britain is importing more manufactured goods than it exports. Finally, he stressed the importance of new industries and our nuclear industry.
I have been asked what would have been the consequence if Sir Frank Layfield had recommended that the pressure water reactor, such as envisaged at Sizewell B, should not go ahead. What would have happened if a Secretary of State for Energy had then supported that recommendation? One thing is certain—Great Britain would have to close down a new technology industry which could give opportunities for employment and jobs, and export opportunities at a time when so many industries have had to face contractions. It would mean that the cost of electricity for industrial, let alone domestic users, would rise.
Last year the right hon. Member for Salford, East proposed a motion at Cambridge that
"This House should halt the nuclear power programme."
I opposed that motion, for some of the reasons that I have outlined. One thing is certain— if there had been a Labour Minister, regardless of the Layfield report, I doubt whether any new nuclear power stations would be built in this country now. I doubt whether existing power stations would be kept in operation, regardless of the consequences.
Not going ahead with a nuclear power programme would affect the lives of our children and grandchildren. It would reduce the availability, and raise the price, of electrical energy, which is of vital importance to our factories.
Nuclear energy as a practical concept is barely 50 years old. I read quantum physics at Cambridge 45 years ago and I have always supported the concept that the development of a nuclear power programme would last at least 100 years. In 50 years time the finite resources of oil, gas and cheap coal, particularly in Britain, will be less plentiful.
The Secretary of State, in a speech entitled "Energy for the next generation: the impending challenge", given in June last year, stressed that the availability of energy was the very foundation of the world economy. He said that we must ask ourselves about the abandonment of a nuclear programme. All wise people must ask that question. I have confidence in a Secretary of State who is prepared to say that, and I welcome the fact that the next phase in the development of a tidal project on the Severn is now being financed and considered.
The Secretary of State also reminded us that the provision of nuclear energy for mankind has its challenges and dangers. One of the characteristics of Britain and its people is that they are very good at knowing why
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something should not be done, whatever that may be, and then allowing our competitors, particularly from Japan and the United States, to jump ahead of them.
Each energy option for the future produces its own environmental hazards and safety problems. Acid rain from conventional coal-fired stations is an example. Nuclear-fired power stations creat a different challenge.
The CEGB has stated what it will be doing next. it has in mind, for the turn of the century, three to five pressure water reactors and two to four coal-fired power stations, probably on the south coast and possibly using British coal. Seven sites are available for nuclear power development.
I come from the main mining area of Britain— Yorkshire and Nottinghamshire—and I am concerned that the price of £42 a tonne, which the CEGB pays for coal, is uncompetitive against world prices. World prices have fallen by 55 per cent. since 1981 whereas British prices have come down by only 10 per cent. British Coal will have to drop its price by over 50 per cent. to be competitive. That is the reality on the other side of the argument and the House must face it.
I support the Secretary of State's resolution over the last year, and his approach to the question of the availability of energy, particularly electrical energy since the Chernobyl disaster. I accept that he has to make a decision and to listen to a debate in the other place as well. I welcome in principle the Layfield recommendations and I hope that the Secretary of State will endorse them, although I know that he cannot do that today.
This nation must take the next steps to ensure more competitive electrical energy for the future. The country should look to the next century and to the provision of energy for our children and future generations. Britain must have energy, at prices which are competitive with those available elsewhere in the world and we must bear in mind the unreliability of liquid and gaseous fossil fuels and perhaps the finite nature of solid fossil fuels.
5.6 pm
Mr. Jack Thompson: This is probably one of the most important energy debates in the history of the House—certainly in the last 40 or 50 years. The inquiry was established because of the lack of public confidence in the nuclear industry and the need for the Government and the CEGB to restore and encourage confidence in the industry. That exercise has not succeeded. The inquiry was based upon a local planning issue and the proposal to build a power generating plant in rural Suffolk. but superimposed upon that was the question of the PWR development, a comparatively new concept for the generation of electricity in the United Kingdom.
The use of PWRs has caused more consternation worldwide than any other form of power generation. The Layfield report notes that when the first power station was built in Britain there was not the same interest or protest that there is today. That is understandable. In the 1930s we did not understand about developing nuclear power stations or about the problems that might arise. Thirty years later, in the 1950s, people take a completely different view of the problems caused by electrical generation using nuclear methods. People are more aware. Even before Chernobyl people were more concious of the problems. People's awareness of the environment, the safety aspects and the costs involved in nuclear power stations has been enhanced.

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It is difficult for hon. Members to fully understand the implications of the inquiry, which runs to eight volumes. I should be surprised if any hon. Member has read all of them.
We must consider what practical steps can be taken in the interests of the population. More confidence would have been engendered by the inquiry if those who objected to the proposals had had the same opportunity as the CEGB to present their case.
Right from the beginning of the inquiry the CEGB—backed by considerable sums of consumers' and taxpayers' money—was able to present its case. The inquiry is said to have cost the board more than £5 million. Smaller organisations—most of them voluntary—could not raise such contributions and a number had to withdraw from making or developing their presentations because they ranout of cash. That contributed, right from the start, to destroying public confidence in the inquiry. That complaint ran throughout the inquiry and was referred to specifically by Sir Frank in the main documents and in volume two, parts 9.41 to 9.42.
Right hon. and hon. Members have concentrated on the safety aspects of the PWRs and the report placed great emphasis on that aspect. I believe that the more detailed comments in volumes two and three suggest Sir Frank's rather lukewarm response to the CEGB's policies. I wish to draw the attention of the House to one fact that has disturbed me greatly—the strained relationship, which is obvious when one reads the main report, between the CEGB and the nuclear installations inspectorate.
From the public's point of view the value of the NII is its independence. I was disturbed to learn—there is only the slightest hint—of some link between the NII, the Secretary of State for Energy and the Health and Safety Commission. The NII is responsible to the commission, which is, in turn, responsible to the Secretary of State. I find that somewhat disturbing as I always thought of the NII as independent.
Volume two of the report is possibly one of the most important volumes. I am sure that most of us will have read the summary of the conclusions, but when one studies the main documents one discovers that some elaborations within the main documents are not touched upon in the summary. That is no criticism of Sir Frank because, obviously, one has to condense things when making a summary. In chapter 8, Sir Frank states:
"The CEGB's statutory responsibility for the safety of US nuclear stations and the NII's responsibility for nuclear site licensing form a sensible foundation for a system designed to ensure nuclear safety."
That is a logical and sensible argument, but:
"the evolution of the licensing process from those foundations has been unsatisfactory: there has been little or no Parliamentary or Governmental guidance on the basis for safety assessment no on how the licensing process should be carried out."
That is a condemnation of this House and the Government rather than anyone else.
Sir Frank states:
"The lack of a clear division of responsibilities between the NII and the CEGB in relation to the licensing process is an important reason why Sizewell B has been delayed."
That is a sad reflection, not only on the way in which we have handled the inquiry, but on the development of the nuclear industry. Parts 9.26 to 9.29 of chapter 8 refer to the relationship between the CEGB and the NII. I find
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that most disturbing because, in common with all British people, I am dependent on the NII to do its job properly ad efficiently—it appears to be under-resourced to carry out that job—on my behalf. If the relationships between the CEGB and the NII are as bad as suggested in the report, I begin to lose confidence in the entire report.
Last week, the chairman of the CEGB referred to the development of future power stations beyond Sizewell. In a meeting held in the House last week the chairman suggested that the CEGB will still go ahead with Hinkley Point—that is definite—although the advice from Sir Frank was that such power stations should be considered one at a time—Sizewell first, then future power stations. The chairman went further than that, because he stated that the programme is not concerned with the development of one nuclear power station at Sizewell, but a series of anything from three to five stations.
One of those stations is proposed to be developed in my county, in the constituency next to mine, but close to my constituency boundary. It is within the constituency boundaries of the hon. Member for Berwick-upon-Tweed (Mr. Beith) and he and I have similar views about the proposal. It is the only greenfield site that is being considered as a proposed power station—the only one listed as such in the CEGB programme—and it is located on an attractive coastal area of the county.
The CEGB has not yet had a response from the Secretary of State about Sizewell, but it is so confident that that station will be built that it has already paid considerable sums of money to buy the land, complete general borings and make a significant investment in the design programme of the proposed station in my county. That displays a super-confidence in terms of the response that CEGB expects from the Secretary of State.
The board claim that the development in my county is necessary to improve the generating resources in the north of England. The location of the proposed station is three miles north of a private power station, which itself is four miles north of a CEGB coal-fired station. In essence, if the board gets its way, there will be three power stations in a line. The other two power stations that I have mentioned are also in my constituency.
The proposed site is on the landward side of a major coalfield that produces about 2 million tonnes of coal a year. The board's dogmatic and occasionally secretive approach to the policy has generated almost total opposition to what appears to be an environmental and economic folly. It is determined to ignore any positive arguments presented by anyone in the area—residents, the county council, district and borough councillors, political bodies of all shades, including Conservatives—and will not recognise the validity of the positive proposal to investigate the possibility of redeveloping and extending the existing CEGB facilities at the Cambois site near Blyth. That site houses a coal-fired station that consists of two units currently coming towards the end of their working lives. It would be logical to refurbish that site and possibly build another station close to it. The CEGB already owns the land and the county council is prepared to sell more land to the board if it is needed. That site, if redeveloped, could consume the coal that is present in large quantities under the North sea close at hand.
That proposition has been rejected out of hand by the board. It will not listen to the argument, nor will it present a counter-argument. We look forward to a change in

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attitude on the part of the CEGB and hope that it will listen to a little bit of logic. We may get a chance to witness that change once the dust has settled after Sizewell.
I am delighted that the Labour party has made a commitment to reject the Sizewell inquiry. As a consequence, the inquiry into the development of the station in my area will be rejected. I am sure that the public will respond to our proposal and we shall not see the power station built in my constituency or one built at Sizewell.
5.19 pm
Sir Eldon Griffiths: One of the most difficult tasks of any hon. Member is to strike a balance between what may be in the national interest and what many of his constituents perceive to be against their local interests. The Sizewell debate requires every hon. Member for Suffolk to wrestle with his conscience over the problem. For two of my colleagues, my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), the Minister of State, Ministry of Agriculture, Fisheries and Food, who is in his place, and my hon. Friend the Member for Suffolk, Central (Mr. Lord), who has studied the issue with the greatest keenness, the dilemma is especially acute. Their positions within the Government make it impossible for them at this stage to infonn their constituents of their views on a contentious local issue.
I have had the advantage of discussions with my right hon. Friend and my hon. Friend and I know that they would agree with me if I start at local level and say that we were all concerned to read Sir Frank Layfield's comments in section F of his report. At paragraph 2.207 Sir Frank states:
"If Sizewell B were built., local people would have to accept serious drawbacks without any corresponding benefits."
In an earlier passage, when discussing the site being within the Suffolk heritage coast, he states:
"The development of Sizewell B would be a massive intrusion into the area."
When dealing with the access road, Sir Frank concluded at paragraph 2.187:
"the CEGB's evidence in support of its case … was weak."
At paragraph 2.201—this is my final quotation on local matters—Sir Frank says:
"The new station would he a totally inappropriate intrusion into the Suffolk countryside … The detrimental visual effect … on the local landscape would be so great that unless the proposal is held to be justified in the national interest, consent should be refused."
Any Suffolk Member is bound to take seriously Sir Frank's observations on these matters. I have therefore to say that I would not agree to consent being given, unless I were convinced that my right hon. Friend the Secretary of State would impose on the CEGB all the environmental and traffic conditions that are recommended by the Layfield report, together with an absolute requirement to leave no stone unturned to secure the safety of Sizewell inside as well as outside its reactors.
I turn now to the national interest. On behalf of what I conceive to be the majority of our people, I would resist all attempts to deny our country the advantages of nuclear power. I say that for five reasons.
First, nuclear energy is virtually guaranteed to be available for the foreseeable future while fossil fuels are not. The precise economics of Sizewell B remains to be determined and I do not envy my right hon. Friend the Secretary of State his task as he wrestles with the Layfield
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report's comments on that issue. In the long term, however, it makes no sense to believe that extracting coal from the bowels of the earth or oil from the North sea is a more cost-effective way of meeting our energy needs for the next century than tapping the energy that is available from uranium, and before long, possibly, from hydrogen. Coal and oil are limited fossil resources. Once they are depleted there will be no more. By contrast, nuclear power taps a virtually undepletable resource. There is no foreseeable limit to its availability.
Secondly, I believe that nuclear power is environmentally less offensive than the burning of oil or coal. Having had some responsibility for pollution control as an Environment Minister, I know that the acid rain that British is accused, rightly or wrongly, of pouring onto the forests of Scandinavia does not originate from our nuclear power stations. It comes from the CEGB's coal and oilfired plants. Neither does the carbonmonoxide or lead that can pollute the air arise from nuclear energy. They are byproducts of fossil fuels. Nuclear power is the cleanest energy available to us on a large scale. It makes no contribution to the so-called glasshouse effect that the burning of coal and oil fuels are thought to be creating.
Thirdly, I should not be a party to handicapping British industry and British homes with higher fuel costs, while our competitors can look forward to the comparatively lower costs that they may expect from the PWR reactors that are already in place or being built in virtually all of our main competitor industrial countries. There are about 500 nuclear reactors in operation or being built outside Britain. I have visited some of them and no doubt other hon. Members have done so too. About 308 of these reactors are PWRs. The French obtain 65 per cent. of their energy from PWRs, while the West Germans obtain 32 per cent., the Spanish 24 per cent., the Belgians 60 per cent., and the Swiss 40 per cent. Japan has recently embarked on a gigantic £420 billion programme to expand its nuclear powered production. The Soviet Union, post-Chernobyl, is also building scores of new reactors, despite its abundant supplies of coal and oil.
The high comparative costs of our fossil-based power in Britain could be one of the reasons why our goods, in recent years, have been priced out of some export markets. To that extent, our high-cost power has contributed to a loss of jobs. Our relatively high energy prices also represent a severe burden on the old and the poor. When we face the next perishing cold wave and Opposition Members demand that the Government take action to assist the old and the cold, let no one doubt at that time that the CEGB will be able to meet our extra demands for power only if it keeps on stream the nuclear reactors that now supply 21 per cent. of its base load electricity. I hope that hon. Members will recall, too, that on such occasions we import power from France. Virtually all that power is generated by French PWRs., located on the Channel coast. Decommissioning our nuclear power stations could deal a serious blow to British jobs and to many of our elderly people, who would be deprived of the guaranteed supplies of heat and light that they need if they are to stay alive.
The fourth reason why shall oppose any attempt to deny our people the advantages of nuclear power arises out of a concern, which I understand the Labour party shares, for the well-being of Third world countries. I shall take one example. If over the next 30 years India, in which I declare an interest as chairman of the Indo-British association, were to expand industrially to the level that

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Korea, Taiwan and Hong Kong have achieved already, the increase in the Indian people's demand for energy will be equal to the whole of OPEC's present oil production.
For the poor and hungry of Afro-Asia, electricity is the key to progress. It alone will enable them to power their irrigation pumps, to provide light for their children to read by, and to warm their elderly people. That is why the Governments of India, China, Pakistan and the rest will not follow the lead of the Labour party in turning their backs on nuclear power. They know that to abandon nuclear power would be to condemn more than half of the world's population to misery and poverty in the century that lies ahead.
Finally, but perhaps most importantly, there is the question of safety. That is paramount. I therefore repeat, I believe on behalf of my hon. Friends from Suffolk as well as myself, that none of us would support the building of Sizewell B unless it is subjected to the most scrupulous and foolproof safety requirements. All else is secondary to that consideration.
But are we really to suppose, following the fears that were sparked by Chernobyl or for that matter Three Mile Island, that our British engineers would be so careless or so criminally negligent as to build into Sizewell B the same design faults as the Russians built into Chernobyl? Are we to suppose that the staff of our nuclear industry, whose safety record is second to none, would ignore the lessons that have been learned by American, Japanese, French and German experience?
No one should imagine that the rejection of Sizewell B, let alone the dismantling of all our nuclear power stations, would somehow magically remove our people from any nuclear risk. The French PWRs, from which we now import electricity into our national grid, are closer to south-east England and the people of Suffolk than many of our big power stations in the north. So if, as God forbid, there were to be a French nuclear accident, most of southeast England is just as much at risk from radioactivity from France, as it would be at risk from fallout from Sizewell. That is why the suggestion of nuclear-free zones is absurd. Like it or not, we are part of a wider European environment in which nuclear power has come to stay. The only question is whether we throw away the benefits of such power while still having to put up with the risks.
I end, as I began, in Suffolk. I ask my right hon. Friend the Secretary of State if not now then in the near future, to give the people who will be asked to put up with the undoubted inconvenience of Sizewell, in the event of its being built, two specific assurances.
The first is that during construction, the wholly inadequate B1122 road will be replaced by a new and better route and that this should be in use before any heavy construction commences. My right hon. Friend the Member for Suffolk, Coastal gave evidence on that point at the inquiry and his views should be taken with the utmost seriousness. Secondly, I ask for this assurance. My right hon. Friend the Secretary of State will know that many of the local authorities in Suffolk have had to accept, as have their people, the inconveniences of the Sizewell power stations without any of the contributions to the rates that ought to be paid in these circumstances. Therefore, I say, in the words of my right hon. Friend the Member for Suffolk, Coastal:
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"Justice demands that the locality be properly helped to deal with the pressures imposed by construction."
Suffolk county council, the district council and, above all, the town council of Leiston must clearly benefit in rate revenue from any new power station. There is already a real sense of grievance that Sizewell A is the only business in Leiston which can contribute not one penny to the town rates yet it uses the local facilities perhaps more than any other.
I hope that my hon. Friend the Minister who is to reply will say that those points will be firmly made to the CEGB and to our right hon. Friend the Secretary of State for the Environment before any decision to give consent arises.
5.34 pm
Mr. Tony Benn: I appeared as a witness before the Layfield commission of inquiry three and a half years ago against the PWR and I believe that the case against now is much stronger than it was then. I find it strange that in the course of speeches in the debate so far, from those favouring the PWR there should have been so little reference to the shift in public opinion that has taken place not only here but in the United States, where no PWR has been ordered for such a long time.
This is an important debate in that it cuts across party lines but I suspect that most people reading it in Hansard or hearing it on the radio will assume that the Government's mind is already made up and that the short statement made by the Secretary of State was for legal reasons, that he did not wish to give a view before he had to give his adjudication on the public inquiry.
Having said that, it is an advisory debate in two senses. First, there is no motion and the House is not being allowed to vote on the matter—
Mr. Dennis Skinner: We are.
Mr. Benn: We shall be voting on the Adjournment but not on a motion.
Secondly, it will be an election issue, however it is put. Many people will determine their view because their attitude to nuclear power will be uppermost in their mind. I do not think that the House or anybody else should be under any illusion about it; the proposal before us today is not only for Sizewell B, but to order other pressurised water reactors and, in addition, such a decision would confirm Britain's commitment to nuclear power.
Most hon. Members will be familiar with the old arguments for nuclear power which were that it was cheap, safe, and peaceful; that there was no alternative; that it was accepted worldwide; and that it was a technology in which Britain led the world. I want to put to the House arguments that will suggest that none of those initial arguments are really true. I say that having had longer experience as a Minister responsible for nuclear power than, I think, anybody else in western Europe. I spent four years as Minister of Technology and Minister of Power and four years as Secretary of State for Energy.
I entered into that task, just after the Dungeness B power station was ordered by my predecessor, Frank Cousins, with all the energy and enthusiasm at my command, believing, like many of my generation, that civil nuclear power was a classic example of "swords into ploughshares" and that, after Hiroshima and Nagasaki, to be able to use that hideous power for constructive purposes was advantageous.
I must confess that my experience over that period persuaded me, in my opinion all too slowly, that none of

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the arguments was true, and before I left office I wrote to the then chairman of the Atomic Energy Authority, Sir John Hill, just after the Three Mile Island accident, telling him to stop work on the pressurised water reactor. I also raised with him the latest and most serious leak at Windscale.
I shall first turn to the question of economies. I am not dealing with comparative prices but I will in a moment. The cost of nuclear power has never been fully accounted for by the generating board. The research and development, very largely in the early years, and entirely later and throughout, has been paid for in the defence budget. The decommissioning costs have never been included. I shall quote one estimate by the French Atomic Energy Commission's decommissioning director, who said that 40 per cent. of the cost of building a new plant would be the cost of decommissioning an old one. Those figures have never been included when we talk about the economics of nuclear power. We have never had a full and candid account of the outages; that is to say periods when the nuclear power stations have been derated or closed down. When there is the question of comparison with coal, like is never compared with like. If one compares a base load coal station with a base load nuclear station, my Department— I am sure that the present Secretary of State would get even more advantageous figures—would say that there is nothing in it at all, in terms of cost. Comparison is always as between smaller, or peak load, coal stations and base load nuclear stations.
Then, of course, there is the argument that has been fully put forward, that with oil prices first going up and then down, and with currency values changing— one must never forget that they can make a profound difference to energy costs—it would be ludicrous to base a decision of this magnitude over this period of time on any forecast, however conscientiously done. To make this point, I shall look back at the outcome of the Windscale inquiry in which, as Ministers, I and my right hon. Friend the Member for Bethnal Green and Stepney, (Mr. Shore) took part in April or May 1978. I shall look at what we said in recommending the thermal oxide reprocessing plant and at what has happened. Since I am criticising myself, I hope that the House will listen.
The capital costs of the head end and chemical plant increased by 60 per cent. in real terms, allowing for the change in prices, over the figure which I confidently presented to the House— from £520 million to—830 million. The total capital cost of THORP escalated from—1·2 billion to £1·65 billion by 1986, according to the same cost levels. The reprocessing charges which I mentioned then rose from £200,000 a tonne to £810,000 a tonne—a real price cost escalation of 100 per cent. It was assumed that the project would be of value to the electricity consumer but the reverse has happened, with the project costing probably £1 billion. As for construction time, we said the project would be completed in 1984, but it did not start until 1984 and will not be completed until 1992. As for waste management aspects, it has been clear that there are other ways of handling waste.
Mr. Steel rose—
Mr. Benn: I hope that the right hon. Gentleman will allow me to finish this point.
I have been—as has any Minister—the recipient of many conscientious forecasts presented by officials for my
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consideration. The right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) gave some vivid examples of generating board forecasts, all of which I requested at the time. Of course, those forecasts were wildly wrong. All I would say in supplementing what the right hon. Gentleman said is that the forecasts were usually very much bigger than the reality, if the CEGB thought that it could get a PWR. But when it was told that it could not, it turned out that the board did not want as much capacity. For many years, the generating board has wanted the American reactor.
Mr. Steel: The right hon. Gentleman will recall that I moved the motion against the THORP when he was the Minister. Two additional points made at the time have been fulfilled. Uranium prices have fallen, not risen and the dry storage facility has become feasible.
Mr. Benn: I am not trying to justify what happened. I am merely saying that, even with the best will in the world—I was an enthusiastic supporter of that project and that technology—in the light of experience we must take account of the fact that the best forecasts are wrong.
I raise another point because of the bitter resentment that I feel. Throughout the whole period when I was the Minister no disclosure was ever made to me that the plutonium from these atoms for peace stations was going to America for weapon warheads. That information was denied not only to me as the responsible Minister who had a duty to convey to Parliament and the public what was happening but to the House after I left office. When I was interrogated by Lord Silsoe on behalf of the generating board during the Layfield inquiry, I was rigidly cross-examined and asked three times to withdraw what I then knew to be true, because Dr. Hesketh, who was fired from the generating board for disclosing this information, said that it had happened.
I quote from one passage stating what happened on day 333 of the inquiry when the counsel for the generating board replied to Campaign for Nuclear Disarmament evidence. It states:
"the basis of the Board's position was to rely on Government statements and assurances that none of its civil plutonium has been diverted to weapons purposes".
That was a lie, yet it was said in the House and told to the public. It is on that basis that people still sometimes speak of "peaceful purposes". I am not trying to identify the Minister responsible. I do not suppose that he was told any more than I was, yet, according to the United States Secretary of State of Energy,
"the United States is required to use for military purposes all the CEGB plutonium received. under the defence agreement".
If democracy is to survive, people must be told the truth.
As for safety, nuclear power is a manifestly and inherently dangerous technology. It was born out of weapons and leaves a legacy for the future for which there is no parallel in any other technology. Yes, poisonous chemicals may seep into the ground and cause damage, but leaving high toxic waste— even if it were capable of being stored relatively safely—with a life running into hundreds of years gives rise to a totally different scale of problem from any that Parliament has ever considered. Of course, Chernobly is a reminder of what could happen.
It is not true to say that a nuclear accident could not happen here. That is like comparing one motor car with another driven by a person who was in a smash on a

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motorway and saying, "It could not happen to a Rolls-Royce—it happened to someone with an old banger." I know from experience that such an accident could happen here. An accident happened many years ago at Kyshtym, but it was covered up by the UKAEA. American intelligence told the authority not to tell British Ministers that there had been a disaster in Russia because they did not want anti-nuclear feeling to feed on a Russian disaster. At the time of Chernobyl, that argument was not used. Two hundred tonnes of uranium were stolen without British Ministers being told.
There is one example which I must put on the record because I am so incensed by the attempts being made to mislead people into thinking that a nuclear accident could not happen here. In 1969, when I was Minister of Technology and Minister of Power, there was corrosion in the early power stations, the Magnox stations. I was so concerned that I asked the chairman of the generating board, then Sir Stanley Brown, to come with me to Bradwell, and I spent the day there. That was 31 December 1969 and I quote from what I wrote on that night about corrosion that might prevent the control rods from going into the reactor. I wrote:
"If, by any chance, there were any displacement of the graphite blocks in which the fuel elements run, or are situated, or even more serious, of the channels into which the control rods drop, you might lose control of the reactor. The position would then be that one of the fuel elements might melt and if there was, at the same time, a rupture in the heat exchanger circuit, you could get a tremendously overheated reactor with the fuel elements melting and a major nuclear accident that would kill many thousands of people in the area of Bradwell and would send a radioactive cloud that might kill people in London."
I deeply resent the suggestion of the pro-nuclear lobby that a nuclear accident could not happen. An accident did not occur at Bradwell. Indeed, because I was so concerned, I called in Sir Alec Merrison, and corresponded when I was in Opposition, with the present Secretary of State for Energy. They found an answer which I think has dealt with a problem. There are many other examples—Three Mile Island, Brown's Ferry, the Windscale leaks and the accidents at Hunterston and at Winfrith. It is very dishonest to tell the British people that it could not happen here.
We are facing in the nuclear business the most powerful lobby in Britain. I have been in Parliament for many years, including 11 as Minister, and I have never come across a lobby with such power as the nuclear lobby. That lobby has known for years what it wanted. I have mentioned Frank Cousins' decision to go for Dungeness B, which was an advanced gas-cooled reactor. At that time, the Ministry of Technology wanted the boiling water reactor, which was in the pressurised water reactor family.
In 1974, the brief given to incoming Labour Ministers was that they should get the PWR, which I think was then called the light water reactor. It was essentially the same reactor. The lobby waited and waited until it could get a Government who would agree to that plan. Lord Marshall, my adviser, told me that he had seen the Shah of Iran, who had offered to buy half the British nuclear industry if we would adopt the pressurised water reactor. In other words, if we ordered it, the Shah would also, and so on.
With Westinghouse, the Ministry of Defence—because of its military interests—and the lobby here, the
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Government and Parliament are facing a lobby in which American interests are very strong. The star wars contracts allow the Americans to vet our technology if it is exported. What will be the limitations on any possible export of technology deriving from a British purchase of the American reactor now?
I advise the House to reject the pressurised water reactor. I believe that, as the nation is self-sufficient in oil and gas, and will be for a long time, and as our coal will last for 300 years—although the Romans thought that it would run out in about 200 AD—with conservation not fully developed as a possibility and with the alternative sources of energy including the Severn barrage, in which I have had a long interest, we should recognise that nuclear power has realised none of the claims that were made for it. The public, not for the first time, are well ahead of the Government in recogising that fact for themselves. I hope to God that the next nuclear accident—and there will be one—does not happen in Britain. If it does, a heavy responsibility will rest upon all those who advocated it, as I did, and even more upon those who decide to prolong it, if the PWR at Sizewell B goes forward to construction and completion.
5.50 pm
Mr. David Heathcoat-Amory: The story of nuclear power in Britain is one of missed opportunities and many mistakes. I do not absolve any past Minister or Government from those mistakes. It must be clear by now that we are on a branch line with nuclear energy.
The first generation of nuclear power stations— the Magnox series—is performing reasonably well, but the successor stations—the advanced gas-cooled reactors—are a major disappointment. No amount of misguided patriotism can disguise that fact. It is a sad reflection on our decision making that we have struggled on with the wrong technology from year to year in the belief that somehow or somewhere somebody will get it right. With each new advanced gas-cooled reactor nearing completion, we are told, "No, it's late: it may not perform up to specifications but perhaps next time we will get it right."
The French started with the same gas-cooled reactors that we had, but in 1969 they faced up to the fact, against all their political instincts, that they should have chosen the American Westinghouse design of pressurised water reactors, and they have never looked back. We must do the same. For us to plough on with the advanced gas-cooled programme would be an exercise in futile pig-headedness.
Why do we need nuclear energy at all? I think that that was the question posed by the right hon. Member for Chesterfield (Mr. Benn). My answer is simply that the world cannot do without it. The population of the world will at least double or even triple before it eventually stabilises. Demand for energy and power will continue to increase much more and much faster than that. The best analysis that I have seen shows that world demand for energy will more than double in the next 25 years. Most of the demand comes from the poorer developing parts of the world.
How will those countries cope? Are we telling them to cut down more trees, burn wood and dung and to use windmills or are we saying that they should compete against the richer countries for the diminishing reserves of fossil fuels, such as gas, coal and so on? That is a narrow and selfish view. It would be better to accept our wider responsibilities and leave the fossil fuels by and large to the

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developing and poorer countries and that our country, and countries like it, should contribute through nuclear energy. Physics gives us the opportunity to close the energy gap. It is a sad reflection on the anti-technology bias in the country and on the Opposition Benches that they refuse to face up to those facts.
Mr. Frank Cook: The hon. Gentleman refers to anti-technology bias and yet he displays that same bias by refusing to acknowledge the developments in renewable alternative fuels. Does the hon. Gentleman accept that to impose a nucler energy source on Third-world countries will in fact impose a sort of technological imperialism?
Mr. Heathcoat-AmoryI am not imposing any technology on any country. The estimates that I have already mentioned take full account of the increase in renewable energy and conservation programmes. However, those estimates still come up with one answer. They show that there will be an energy gap by the end of the centry unless we find ways, other than burning fossil fuels, to contribute towards the world's energy needs. As this country has the means we must develop nuclear energy and leave the fossil fuels to the developing world.
I shall refer to one or two more specific arguments against the Sizewell B PWR proposal. It has been claimed in the debate that the recent fall in the world prices of coal somehow undermines the case for Sizewell B. The inspector, in his report, warns against using short-term fluctuations as a guide to the future. That point was well made by my right hon. Friend the Member for Guildford (Mr. Howell).
More importantly, the inspector assumed in his report that any alternative coal-fired power station would be able to import its coal freely at world prices. I understand the need for that assumption in the report in assessing the economics of Sizewell B. I do not criticise the inspector on that ground, but in practice the assumption is unrealistic. Even under this Government, the CEGB has to pay up to 40 per cent. more for most of its coal than is obtainable on the world market. I am sure that the right hon. Member for Chesterfield will be in the forefront of Opposition Members who are against the import of foreign coal.
Therefore, under every conceivable scenario the inspector's assumption is unrealistic. If coal at the higher British prices were used, the case for coal would collapse completely. I hope that right hon. and hon. Members who follow me in this debate will touch on that point. I have read carefully the 100 or so pages of the inspector's analysis about future fossil fuel prices. Because he assumes, unrealistically, that the CEGB will be able to import cheap coal at world prices, I believe that he overestimates the case for coal. He gives it too great a degree of benefit. I await comments from those Opposition Members who are most vociferous in preventing the closure of the gap between domestic and foreign coal prices.
Mr. Dalyell: I think that the Secretary of State, in his short and careful speech, should have produced the latest assumptions and forecasts, on which his Department was acting, for the years 1990 to 2000. The Department has those figures and the House of Commons should have a copy of them.
Mr. Heathcoat-Amory: When the hon. Gentleman makes his speech I am sure that he will pursue that point.
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However, it does not detract from my argument, which is that, even though coal prices abroad may temporarily drop, it does not mean that the inspector's evaluation of the case for coal is anything less than valid. Indeed, it may be too generous.
People who want a complete as surance about the safety of Sizewell B are asking for the impossible. There are risks attached to every human activity and every industry. The inspector's analysis is about as rigorous as anyone could want. If the same searching techniques were applied to other industries we might conclude that they were too dangerous to tolerate.
There have been criticisms during our debate of the inspector's attempt to evaluate the risk in economic terms. He has had to try to balance risks against economic benefit. How else do we allocate resources to try to save lives? If anything, we are in danger of spending millions of pounds to try to reduce what is already a small risk, whereas the same amount of money could be spent designing better and safer cars and aeroplanes. In that way we could save thousands of lives. But that is not a criticism. I fully accept that that is the price that we pay for public acceptance of nuclear energy.
I want to refer to waste.
Mr. Kevin Barron: When we consider costings in relation to any likely danger in the nuclear industry, should we not take into account our indigenous fuel supplies? Our costings might be different from those used in Japan or France, which do not have such indigenous fuel supplies.
Mr. Heathcoat-Amory: No doubt the hon. Member for Rother Valley (Mr. Barron) will pursue that point in his speech. His argument in no sense invalidates the inspector's analysis or my remarks. If the hon. Gentleman is saying that we must accept expensive coal and that that is the end of the argument, I. must part company with him.
Of course people are concerned about waste. But I believe that a far more potent threat lies in the millions of tons of toxic industrial and chemical waste that we pump into the atmosphere and pour into landfill sites every year. The pollution of underground aquifers is the long-term threat to our water supplies. Unlike radioactive waste, which gradually decays, many chemicals and poisons do not break down but continue to be a threat for all time. Opposition to nuclear power on environmental grounds is misconceived. When properly managed and designed, nuclear power stations are less damaging to the environment than many other industries.
The CEGB has announced that it intends to apply for planning permission for Hinkley Point C in Somerset. Some allege that the Severn tidal barrage is the preferable option. I cannot comment on the advisability of such a barrage, as we still await a further study. However, it is certainly not clear to me that a barrage is to be preferred on environmental grounds. Criticisms about the potential threat to the coastline, wildlife and ecology must be taken on their individual merits.
If demand for electricity continues to grow at its present rate, we may well need both Hinkley C and the Severn barrage. Whether or not that is so I ask my right hon. Friend the Secretary of State to heed the inspector's comments about the need to benefit the local community through the rating system. Somerset does very badly out of the existing system of local government finance. and its

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rate support grant is very unsatisfactory. I endorse the point made by my hon. Friend the Member for Bury St. Edmunds (Sir E. Griffiths) that both Somerset and Suffolk should be allowed to retain some of the additional rate income generated by either or both of these large projects.
The inspector's report is formidable and deserves to be taken most seriously. I am not convinced that the right way of mapping out the future of Britain's energy policy was chosen, but no one can doubt the intelligence and application brought to bear on the problem by Sir Frank Layfield. I am amazed that Opposition parties, including the Liberal party, should have closed minds about the report. They have rejected Sir Frank Layfield's conclusions out of hand before even reading it.
It is well known that the inspector recommends a PWR at Sizewell. I hope that in due course we shall have a series of PWRs. The siting of each one will, of course, be subject to the due planning process, but if we replicate the standard design, future stations will be cheaper than Sizewell B. That decisively tilts the economic argument in favour of the PWR. The inspector was able only to cost Sizewell, but Hinkley Point C and other successor stations would be at least £200 million cheaper on capital cost. If that means closing off the AGR option, I think that we should do so. We should not raise expectations that we shall fudge the question again by trying to operate two technologies at the same time. Above all, let us give our scientists, engineers and technicians a clear agenda so that, as a nation, we can face the future with a clean, safe and efficient source of energy and, in so doing, make our contribution to solving the world's energy problems.
6.5 pm
Mr. Kevin Barron: I should like to discuss the recommendations about safety in the Layfield report. If Chernobyl and Three Mile Island have taught us nothing else, they should have acted as a warning that technology does not exist in a vacuum, but functions in tandem with the human beings who design and operate it. We should bear in mind that 80 per cent. of all major nuclear accidents have involved human error. The designers of the complex systems involved in a nuclear power plant try to engineer out the possibility of humans doing stupid things that will ruin the plant, but experience has shown that that is not always possible.
Much has been said about the accident at Chernobyl in the USSR. I should like to comment on what was said by the leader of the delegation sent by the British trade union movement to Chernobyl. Mr. John Edmonds, the general secretary of the General, Municipal, Boilermakers and Allied Trades Union and a number of his colleagues went to Chernobyl to meet the operators of the plant and the engineers responsible for the tests that were carried out. It was clear from their discussions that the operators themselves had carried out to the letter every order that they had received from above—except one.
I remind the House that a large number of GMBATU members are involved in the nuclear industry, and could hardly be classified as belonging to the anti-nuclear lobby. It is therefore significant that GMBATU is now calling for a moratorium on the construction of further nuclear power installations until the full lessons of the dreadful accident at Chernobyl have been absorbed in this country.
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There is a belief within the nuclear industry, which is dutifully trotted out by the industry's supporters, that it is possible to design a nuclear plant that can operate regardless of human error. We should recognise that that is a fallacy. Sir Frank Layfield accepted that human error was an important factor, and the NII said that it was a "potentially significant contributor to the risk from Sizewell B"
Layfield admits that the effect of human error on safety is "potentially large". Those conclusions should not be ignored.
I believe that both the CEGB and the NII have ducked the question of human error. I hope, before any decision is made, that consideration is brought into play. We should ask whether the Sizewell B plant will be safe both for workers and for the public. No one who has read the Layfield report can truthfully answer yes to that question. The CEGB says that at the Sizewell plant, the first PWR ever built in this country, it will reduce the exposure of workers to radiation to a level lower than that to which they are exposed in any other country in the world operating PWRs, apart from Switzerland, which has only three PWRs. To his credit, Layfield was not impressed by the CEGB's argument on this issue. He regards the plans for operator exposure as "ambitious", which is a barrister's way of saying that he does not believe them. Layfield also concludes that
"the risks to workers at the station may be higher than risks to most other industries considered to have high standards of safety".
That is another way of saying that, if we build a PWR plant, it will be a backward step for the safety of the operators who work there.
One of the major weaknesses of nuclear power revealed by the Chernobyl disaster was the emergency planning around nuclear plants. Women and children were evacuated as far away as 90 km from Chernobyl. We seem to have a great deal of optimism. Our emergency evacutation zones extend, at most, to two and a quarter miles from plants. After Chernobyl, we should ask questions about emergency planning. After the Chernobyl disaster, the Government recognised that there was a need to review the emergency planning arrangements, but, despite a gap of 10 months, the interdepartmental working party has yet to give us the fruits of its deliberations, despite their being promised on many occasions. We have a right to hear the conclusions of its work and to establish whether any changes are required before any decision is taken on the Sizewell proposal.
Mr. Jeremy Corbyn: Does my hon. Friend think that it is high time that the Government also made a detailed and considered assessment of the likely cancer effects of the Chernobyl fallout in Britain and Ireland, as has been done in other countries in Western Europe?
Mr. Barron: That is certainly true at this stage, in view of what has happened in agriculture in north Wales and Cumbria. Nothing conclusive will be produced for a long time about fallout from the plant. Some hon. Members have said that, if Sizewell does not go ahead, we still have facilities in France. Indeed, facilities in Russia could be a danger to public health in this country. It would be wrong to go ahead with this proposal until all the proper decisions have been taken.
When one considers that planning emergency exercises are carried out once a year at every plant, one becomes a

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little worried. I have tabled a number of questions on this matter to the Minister in the past few months since the Chernobyl incident. Taking into account the number of shifts at each plant and the number of people on leave, who are sick and so on, we might find that operators are involved with annual emergency evacuation plans only once every six to 10 years. Bearing in mind what is happening in the nuclear industry, that is quite feasible. It is worrying. It smacks of our saying that we would regard a factory fire drill once every 10 years as acceptable to people who are in danger of fire. I do not believe that that is the case.
The Secretary of State spoke for just six minutes when he opened the debate. I wish he had examined further what was stated in the Layfield report. Perhaps we shall find that his mind has been made up. Indeed, I suspect that the Cabinet's mind has been made up. In fact—I could be more accurate—perhaps the Cabinet's mind was made up on 23 October 1979, when, at a Cabinet meeting at Downing street, presided over by the Prime Minister, decisions were taken in relation to PWRs. I have a document marked "Secret". It is the Cabinet ministerial minutes for that meeting. The right hon. Member for Guildford (Mr. Howell) is mentioned in the report as saying that the construction of such a reactor— meaning, obviously, the PWR— would be conditional only on safety clearances from the nuclear inspector.
Perhaps that is a good thing. I refer Conservative Members, who are nodding their heads, to chapter 108.12 in the conclusions of the Layfield report. It states:
"many matters were examined only briefly if at all, and much work remains to be done on aspects of the safety case which were examined in evidence. Furthermore, the design was incomplete and not yet susceptible of a final assessment of its safety."
I should have thought that the right hon. Member for Guildford would not have been pleased, in view of what he said at the Cabinet meeting in 1979, they were to go ahead.
The Cabinet minutes refer to the Prime Minister's comments in relation to the nuclear industry and how she saw the nuclear industry going in the future. After talking about achieving a sizeable nuclear programme that should also include prospects of PWR, she also mentioned that "satisfactory clearances" should be obtained before she would be happy with the situation. Nobody can be happy with Sizewell. As Frank Layfield and many other serious, responsible people admit, there have been grave omissions from the inquiry into the safety and, indeed, the basic design of the PWR that is presently proposed. On safety grounds, we should not go ahead with Sizewell.
My right hon. Friend the Member for Salford, East (Mr. Orme) referred to the report from the Cambridge Energy Research Group, which did the initial costing of the Sizewell inquiry for the CEGB. The report, published this month, states:
"The report highlights the economic risks associated with pursuing the nuclear option, particularly with regard to capital cost overruns, exchange rate fluctuations"—
obviously, we all realise that we do not know what those will be over the next 12 months or the next 25 to 30 years—
"and upward pressure on discount rates."
That is, in relation to the cost of the PWR. At present, one could say that the latter case is likely to be 5 per cent. a year in terms of its total cost. Bearing in mind Conservative Members' designs for selling off publicly owned industries and so on, I do not think that, in all
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honesty, we could say thai keeping the 5 per cent. level for now and the next 30 years would be attractive. I question whether 5 per cent. is the level at which we should look.
There is also the matter of capital cost overruns The first magnox stations and the first AGRs that were built in this country had an average construction cost overrun of over two and a half years. The last three AGRs—Dungeness B, Heysham and Hartlepool— had a construction overrun cost of 10 years. The nuclear industry does not have a good record for providing planned electricity generation on time. It is farcical for anybody to stand firm, as Conservative Members do. and say how good Sizewell will be, and how we need it because we need electricity generation. If it is anything like its forerunners in the nuclear industry, there can be no guarantee that, in 10 years' or even 15 years' time, we shall generate electricity on the coast at Sizewell.
The right hon. Member for Guildford mentioned the report recently brought out by the Cambridge Energy Research Group. One of its conclusions directly relates to what the right hon. Member said. It states:
"Future coal prices are uncertain and we do not know what the price of coal will be during the 30 years life or the Sizewell station from 1995, any more than we did in the early 1980s when the Sizewell evidence was originally presented."
Of course that is true if the same parameters that were used to assess the cost of Sizewell in the early 1980s are used today. It cannot be wrong. Nobody can dismiss this month's report in relation to likely costs. The report. goes on to state, that, as far as the one in 40 chance that Frank Layfield reported is concerned, an economic case could be made for coal against nuclear power. It is certainly a lot less than that.
Bringing in coal by the CEGB at world prices has two implications for the nation. One is a balance of payments implication, as any imports have. It might be too big for us to bear. It also has the other cost, which my right hon. Friend the Member for Salford, East mentioned—that is, the cost to the nation of further running down the industry. For example, I refer to the coal industry, the social costs and many other matters. Many of these can be put to the rundown coal industry in my constituency. The loss to the Exchequer through unemployment benefits, national insurance and income tax for my constituency alone is between £34 million and £36 million a year. Those are the costs that would have to be taken into consideration before we said that world coal should be brought in.
For about 10 of the past 16 weeks, British miners have broken the productivity record. A coal mine in which I used to work in my constituency has been consistently good for many years. It consistently breaks records every other week at present. There is nothing to say that, with the right investment at that colliery, that cannot go on for ever. It is wrong for anyone to jump to the conclusion, even on the present costs of British Coal, that those costs will no go down over the next five years.
Mr. Heathcoat-Amory: How does the hon. Gentleman answer the point that the Sizewell inspector dismisses the case for coal, even assuming that we would be able to import coal freely at world prices? Now that the hon. Gentleman has conceded that British coal would be more expensive, how can he say that the case for coal is stronger than outlined by the Sizewell inspector?
Mr. Barron: I thought that I had attempted to explain that. The same parameters were used in the early 1980s as

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were used in the Cambridge Energy Research Group report. The same people who did the costing for the CEGB and the Layfield report have costed that report.
Mr. John Hannam: On world prices.
Mr. Barron: Yes, on world prices. I thought that I had explained that.
We do not know what the position will be in five years' time for the coal industry, nor do we know what the position will be for the nuclear industry. We do not know what will happen in 10 or 15 years' time, and whether any PWRs will be generating electricity at that time. No one can say that. Of course, many questions have to be asked. Given that the same criteria are being used now as in the early 1980s, I cannot see how one can come to any conclusion other than that it looks better now for coal than it did then.
I am sure that my hon. Friend the Member for South Shields (Dr. Clark) will refer to the risks to the environment. The effects on the environment and so on will have to be costed, too. It is said that it would take 50 to 100 years to decommission such a power station. If it was costed in the same way as a coal-fired power station, which takes five years to decommission, the economics of the PWR at Sizewell would be impossible.
Questions have to be asked. I believe that it is better not to go for the PWR. This country should not go for nuclear generation in view of our indigenous fuel supplies. In the report to which I referred, it is asked:
"Do the results of the study confirm the view often held by senior planners in both government and utilities that nuclear power will inevitably offer significant economic advantages over coal? We believe the answer is 'no'."
That is what the report concluded. Those are the same people who gave evidence four years ago to the Layfield inquiry. To use the argument that is often used now that there is a 40:1 chance that nuclear power will be better is wrong.
The House would be wrong to accept the Sizewell proposals. It would be much better to have a programme of building coal-fired power stations as urgently as possible. We need such a programme. Eight years have elapsed since there has been an order for any type of power station. The industry, NEI and others are crying out for us to go ahead as soon as possible. It is my opinion that this Government, for their own reasons, have decided to hold back on coal-fired power stations while they squeeze out of this country by any means that they can a PWR at Sizewell that this country could well do without.
6.24 pm
Mr. Robert Harvey: I congratulate my right hon. Friend the Secretary of State on the characteristic respect and modesty that he has shown in consulting the House before making a decision on Sizewell B.
There are so many Conservative Members who, like myself, so passionately reject the Labour party's unilateralist stance on nuclear weapons and so dislike the coalition of forces assembled behind the proposition that anything nuclear is bad that sometimes I think that we are all in danger of confusing the issue of nuclear weapons with that of nuclear power. For example, I am wholly committed to the retention by Britain of nuclear weapons
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for as long as our potential adversaries retain theirs. The nuclear balance has preserved peace in western Europe since 1945, and negotiation from nuclear strength may soon lead to the most far-reaching arms control agreement since the last war. But the issues are entirely different when it comes to the civilian use of nuclear power and there are many like myself who consider that it poses a greater potential threat than any posed by nuclear weapons.
In his exhaustive and admirable report on the proposed PWR at Sizewell B, Sir Frank Layfield has answered all the questions within his terms of reference. He has not gone outside those terms to answer the wider considerations. That is the task of the House. Those wider considerations will not go away. The main consideration is the debate on nuclear safety which, all over the world, has frozen the development of nuclear power. In the United States, the programme has long been at a standstill; in Italy and Brazil, likewise; in West Germany, it has slowed; in Austria, it has all but been abandoned. Only France and the Soviet Union are still pushing full ahead. It is true that the CEGB's record in Britain has been excellent, with not a single fatality resulting from a nuclear accident, but the safety doubts remain.
he first doubt concerns those working in and living around nuclear power stations. It is impossible to establish a direct link between radiation and the higher rate of leukaemia that appears to exist around power stations. That has not been finally confirmed, and we await the report on it, but the probability is high and it is a legitimate cause for public concern.
The second main area of concern is the potential danger to the public of a major accident. There are those who consider such accidents to be part of the inevitable price of progress. For example, how many people would have advised against the development of the jet aircraft if they had known in advance how many would die in air crashes over the years? But there is a difference. First, it is the task of Government not blindly to accept progress, but to help to direct progress where it can be of benefit to mankind. Secondly, those who fly in aeroplanes do so voluntarily; those affected by nuclear disasters have no choice. The nuclear industry's remarkable safety record so far is such that it is easy to minimise the danger. However, what is unique about the nuclear industry is that one accident could have such horrifying consequences.
The danger which, thankfully, failed to materialise at Three Mile Island in the United States came appallingly to life in the Chernobyl disaster, which was outside the terms of reference of the Layfield report. The awesome nature of that disaster has not sunk home to most people because it took place in an authoritarian and secretive nation. Suffice it to say that the official Soviet report showed that as much radiation was released at Chernobyl as in the atomic attacks at Hiroshima and Nagasaki, and the death toll of 31 to date seems likely to rise to 5,000 as a result of cancer caused by radiation exposure. Additional radiation effects were felt as far away as the hills of my constituency of Clwyd, South-West. One can react to Chernobyl by saying, "It couldn't happen here," and it is a good deal less likely to happen here because we have far higher safety standards and a more open society, but that is quite different from saying that it could not happen—and heaven help us if, on this overcrowded island, it does.
After Chernobyl, for any major country to proceed with an expansion of its nuclear programme, an overwhelming case has to be presented, either that it is the

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most cost-effective form of energy generation today, without which we would be at the mercy of those of our competitors who have nuclear power, or that impending shortages of coal and oil mean that nuclear power would be hugely cost effective in the long term.
The Layfield report makes a recommendation that, on balance, a nuclear plant would be cheaper than a coal-fired plant, but even that judgment has been cast into doubt by the subsequent fall in the price of oil and coal. I recognise that the long-term judgment is more difficult. Certainly, oil prices could escalate again and as our North sea reserves dwindle, the Government must begin to think in terms of maintaining a strategic reserve or stock for this country well into the next century. However, other forms of energy may have become feasible by then—not the absurdly expensive and environmentally damaging forms such as wind generation, but the safe production of power through fission. If the economic case for Sizewell is overwhelming, the power station project should proceed, but an overwhelming economic case for Sizewell B has not been made in the Layfield report. The only countries sold on nuclear power at present are France and the Soviet Union. If we join the ranks of the doubters— the Americans, the Germans, the Italians and the Austrians—we may affect public opionion in France one day.
While not abandoning nuclear technology and the possibility of its improvement to a degree of safety that might one day allow it to proceed. I urge the Government to gradually phase out the existing nuclear power stations that show signs of age and to phase down the Sellafield reprocessing plant in parallel as the number of leaks and operational difficulties at that plant continue to mount. I also urge the Government not to proceed with Sizewell B in the near future. I believe that the lid of hell itself was briefly blown off in the Chernobyl disaster before being sealed by a massive concrete casing. The more nuclear power stations there are at the existing stage of technology, the more likely it is that that ghastly episode will some day he repeated somewhere else.
6.31 pm
Mr. D. E. Thomas: I have the unexpected pleasure of agreeing with my neighbour the hon. Member for Clwyd, South-West (Mr. Harvey) who has spoken sensitively and has reflected the feeling within the farming community and the community generally in North Wales, where there are two Magnox stations. The area is faced with the aging station at Trawsfynydd in Meirionnydd Nant Conwy and the decision as to whether there should be a second generation of nuclear power stations. I believe that most people in that part of Wales would agree with the sentiments and the sensitive speech of the hon. Member for Clwyd, South-West. However, I suspect that the hon. Gentleman may not receive much response from the Government Front Bench.
I want to concentrate on the issues that affect my constituency and to highlight three of the issues raised by the Layfield report. The report raises more questions than it answers. As a process of public inquiry, which has been carefully judged and balanced the report provides a massive amount of evidence which, as it is reassessed in the period since publication, shows clearly that the balance of evidence is different from that judged by the inspector.
It is important that we get away from the notion that the report is a once-and-for-all determination of a programme for nuclear power stations. The Layfield
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report stresses that each fresh application must be considered on its merits. It is essential for those of us who are concerned in Somerset and South Wales, about the possible application for Hinkley Point C and the site at Druridge bay which was referred to by my hon. Friend the Member for Wansbeck (Mr. Thompson) and other sites in England and Wales which may be targeted by the CEGB for development, that each of those applications will be a fresh application in the context of the energy requirements at the time and particularly in the light of other emerging technologies. The House should firmly reject the notion that we are considering a final decision today.
I want to consider the aspects of radiological and environmental protection arising from the report and the interface of civil and military plutonium. I also want to consider the impact of power stations and energy policy on local communities.
Any assessment of the future development of the nuclear industry—as we are trying to assess tonight—must be based on our experiences of the way in which the industry operates. I am particularly concerned about the principle of the discharges from power stations— the principle of "as long as reasonably practicable" or ALARP as it is called— and its application to the Magnox station at Trawsfynydd. That station came on line in 1965. It is now more than 21 years old and still awaiting the report from the nuclear installations inspectorate which is reviewing Magnox stations.
I want to place on record my highest regard for the professional quality of the work of the staff at the station, most of whom are my constituents and at least some of whom are still my friends. They do as good a job as possible of running the plant up to a level of safety. Clearly those of us who live next to those power stations or who have public responsibility for them, must be concerned about the safety of the current generation of Magnox stations. We must assess the future of any further development on the basis of our understanding of that safety record.
It is my responsibility to raise questions about the safe environmental operation of the Trawsfynydd station. The figures to which I shall refer this evening are well documented and are publicly available from the CEGB. the Welsh Office, and the Ministry of Agriculture, Fisheries and Food. It is clear from the figures of environmental discharge that the principle of "as low as reasonably practicable" has not applied to discharges from Trawsfynydd. Trawsfynydd is an inland station, cooled from an inland lake and it is quite exceptional in that respect within the United Kingdom nuclear plants. However, the figures of discharges between 1977 and 1981 show that cobalt-60 levels rose by 400 per cent. The caesium discharges over the period from 1982 onwards reveal a substantial increase. The figures of discharge revealed in the mud and silt in the lake up to 1982 and the figures for a further three-year period show an increase from a relatively low level of five and 12 bq/kg of fish up to 36 bq. There is a more serious increase in caesium 137, with levels of around 1,500 bq/kg to 3,000 bq/kg in mud which has increased suddenly over the past three years to a level of 8,000 bq/kg.
If the principle of "as low as reasonably practicable" has been applied, how can such massive increases in discharge have occurred? Monitoring by the Ministry of Agriculture, Fisheries and Food and others has shown a

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massive increase in contamination in the lake. It is right that the board and the monitoring authorities should respond and give reasons for that contamination.
We can speculate whether fission products such as cobalt-60 have been flaking off from the tubing of the reactor as a result of thermal shock from rapid shutdown. We can speculate about the causes of such discharges. However, speculation is not good enough. We need to know the reasons for such increases. Any substantial increase in discharges from Magnox stations is unacceptable. That is why the local authority, Gwynedd county council, has recently set up an independent monitoring system and I am looking forward to the publication of all independent monitoring reports on the levels of discharge from the station.
If the board is serious in its commitment to openness and maintaining public confidence in the nuclear industry, it is important that the precise reasons for those discharges should be made plain.
That is not the only example of lack of information or secrecy in the industry. As my right hon. Friend the Member for Chesterfield (Mr. Benn) said earlier, we still have not had a clear statement from the Government or the nuclear industry on the precise relationship between civil and military plutonium. In paragraph 105.70 of the report, Sir Frank Layfield stresses the need for the reprocessing of spent fuel from Sizewell B or later stations to be carried out in buildings
"separate from those used for military reprocessing."
I assume from the Government's decision on co-processing that this is what will happen from now on at Sellafield, but we still have had no information about what has happened to military and civil plutonium in the past. Layfield recommends that a specific designation of civil or military plutonium should be applied to its origin and destination.
Nor have we been told what has happened to plutonium from Magnox stations. I have corresponded extensively on the subject with the Secretary of State and his predecessors. I have asked many parliamentary questions, but the Government's view is not clear. The Prime Minister tells me one thing and the Secretary of State tells me another. Apparently the official position is still as was set out by the previous Under-Secretary of State for Energy, who said on 4 February 1983:
"No plutonium produced in any of the CEGB's nuclear power stations has ever been used for military purposes."—[Official Report, 4 February 1983; Vol. 36, c. 206.]
Is that still the Government's position? From information that has come to light since then and from independent calculations, it is clear that that cannot be true. Yet the Government stick to that line and the CEGB, in its public pronouncements, hides behind misleading answers that have been given to the House. If the Government accept the principles of Layfield as they apply to the future separation of civil and military plutonium, the entire record must be made clear to the House. Statements made by Ministers in the House have misled the public, and the Government are obliged to make the matter entirely clear.
The third aspect with which I wish to deal is the impact of nuclear power stations on the local community. It is clear to those who have read the report in detail, especially the sections dealing with the local impact, and it was clear
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from the speech of the hon. Member for Bury St. Edmunds (Sir E. Griffiths) that the building of a nuclear power station brings little benefit to a community. Indeed, the report shows that there is a disbenefit in terms of environmental impact and dislocation of the local economy. Yet the main argument of supporters of nuclear power in my constituency is that it is the only way to create jobs in a rural area. But we know the sort of employment that is generated. A boom and bust syndrome is created by high employment during construction, lower employment during operation and even lower employment during decommissioning. The only long-term employment created by nuclear power stations is in the security guards who must maintain the core for 100 years. That will be a job for generations to come.
The net effect of a major construction project on a rural community is a diseconomy of scale in terms of permanent employment. The report brings out that fact clearly.
The Government have an obligation to communities that have hosted nuclear plants and are now faced with decommissioning not to look for new major nuclear construction projects in those areas but to provide public funding large enough to create alternative jobs. The county council, Mid-Wales Development and the local authorities in my constituency are seriously considering alternative employment. The Government have an obligation to those of us who have lived with the first generation of nuclear power stations. If they are serious about their obligation to the community, they should commit themselves to providing alternative employment for those who have provided energy from the present generation of Magnox stations.
6.45 pm
Mrs. Anna McCurley: It is generally recognised that all forecasts about future demand for energy have been wildly under-estimated. With that in mind, I urge the Government to support the British nuclear energy programme to the hilt and to go ahead with Sizewell B.
The capacity of Sizewell B would in no way impede the contribution of other forms of energy, including fossil fuels, to the ever-growing demand. Indeed, I should be the first to suggest that alongside a decision to go ahead with Sizewell, the Government should think seriously about speedily commissioning two coal-fired power stations. Experts agree that there is a need for a balanced fuel policy. I admit to having a constituency interest in both camps, as many of my constituents are employed by Babcock Power and would assuredly be involved in the construction of Sizewell and probably in the construction of coal-fired power stations. As employment has been a problem in the industry, the decision to go ahead with Sizewell, for which contracts amounting to millions of pounds have already been signed and to which many hundreds of man hours would be committed, would stabilise Babcock's employment figures. More jobs would also be created if the Secretary of State ordered two coal-fired stations, but I hesitate to make the need for jobs in Renfrewshire the paramount consideration in a debate of this kind.
Safety is, of course, of the greatest importance. There was a practical and positive approach in the Layfield recommendations. Chernobyl has happened since that report and has perhaps altered our perceptions, but we must not over-emphasise it. Since Chernobyl, we have put

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the perspective right on nuclear accidents. We now know what was previously the unknown. The Russians have admitted the design faults specific to the RBMK, where the onus of care was left not to technology but to the operators. The design and characteristics of the Sizewell PWR are completely different from those of the RBMK 1000, and safety standards here are much higher than they have been so far in the USSR. More important, until recently, the USSR did not have an independent nuclear inspectorate, although there are proposals to have one now.
I noted with interest that within weeks of the Chernobyl accident the Russians announced proposals to expand their nuclear power industry. That is probably because the extent of a nuclear accident is much better understood. For us in Britain, it is just as well to know the effects, as we live within a 350-mile radius of nuclear power stations operating in Europe. If Sizewell went ahead within 150 miles of London, we would have only 29·8 per cent. of operating capacity. The French make up the rest within 350 miles. including every United Kingdom station except Dounreay. We should have only 24·8 per cent. of capacity because the French, Dutch, Belgians and Germans have the rest, so we are under more threat from existing stations in Europe than we would be from Sizewell.
The radiation dose in the United Kingdom from Chernobyl amounted to 0·3 milliSieverts in Wales, Cumbria and my part of Scotland. That should be compared with background radiation of between 0·8 and 1·7 mSv per year in the United Kingdom, between 5 and 80 mSv a year in India and up to 125 mSv a year in Brazil. People are known to thrive in atmospheres with high background radiation. Perhaps I can put the figures in perspective by saying that the effect of the 0·3 mSv experienced in the United Kingdom from Chernobyl is equivalent to living in Aberdeen for four months. Some might say that there is a greater danger to health from living in Aberdeen. The dose can also be compared with drinking an extra bottle of wine or smoking one cigarette every 30 months. Such is the effect of radiation from Chernobyl in Britain. Moreover, the level at the Chernobyl site was never so high as the cases that I have cited.
We might compare that nuclear accident with the accident at Bhopal, where 2,000 people died. Another 100,000 at least are suffering severe after-effects, and the after-effects of Seveso are still not quantifiable. Bearing those accidents in mind, Chernobyl seems much less dramatic. We must keep that in mind. After all, if we had not had a balanced attitude to safety and innovation in the past, we should never have proceeded with coal mining or car driving. So long as we can guarantee that, with a PWR, there is no departure from operating procedures to carry out experiments such as were conducted in the USSR—believe that that would not be possible here—so long as it is clearly understood that other United Kingdom and Western reactors are designed to much higher standards, and so long as there is close security, unlike Chernobyl, we can be reassured. Even if operators ignored their instructions, United Kingdom reactors would not go what is called "prompt-critical".
I am not a nuclear scientist or physicist, but I know that a positive void coefficient is not acceptable. That was considered on the SGHWR, and displacer tubes were fitted in the core to make the void coefficient significantly negative. Although the inspector's report in no way denies
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the possibility of accident, I believe that the probabilities are well dealt with. In this regard, we have to consider and understand the principle of acceptable level of risk.
The Government and the industry have a proud safety record. No other country devotes so much time and money to safety. In those circumstances, and provided that they prevail in the future, I urge the Government to go ahead with a positive decision.
6.53 pm
Mr. Peter Hardy: I hope that the hon. Member for Renfrew, West and Inverclyde (Mrs. McCurley) will forgive me if I do not follow her, but I do not wish to make a long speech, although it will he a little longer than the Secretary of State's graceful and proper introduction. He reminded the House that he had been here 25 years but that he had never before been in the situation in which this debate puts him.
I hope that the Secretary of State will think back to the day when he first entered the House. He need not even think back that far. He might think back only to the early 1970s when hon. Members could take parties around the House without difficulty and when access to all manner of public buildings and travel through airports was a great deal easier. People who wanted to see their Member of Parliament were able to do just that, and we took them around the Palace without their having to go through X-ray machines and metal detectors. We did not suffer what I experienced last week. I was taking respectable people around, who probably would not recognise a bomb orgun if they saw one, but they had toqueue in the bittercold morning outside the Norman porch t o get in. That did not happen when the Secretary of State first entered the House. The difference is the result of serious and dreadful changes on our planet as terrorism and international crime proliferate. That gives rise to a serious reservation about the growth of nuclear power.
Conservative Members should understand that one result of the development of nuclear power in France has been a strengthening of the rather more positive— if that is the correct word— and vigorous policing that is practised there. People in France may be a little less enthusiastic about nuclear power than some Conservative Members seem to believe as a result of the way in which their protests might be dealt with. That is not a condition that any of us should wish to see here if we are to remain, as many hon. Members believe that we are, a free country and a bastion of liberty. The dangers of nuclear power assisting terrorism could be substantial. I believe that security would be maintained, but that we would be maintaining the growth of employment in the security industry, which is at present about the only growth industry in the United Kingdom.
Mr. Michael Morris: Rubbish.
Mr. Hardy: It is all very well for the hon. Gentleman to shout "Rubbish", but I have heard more rubbish from Conservative Members on this subject in the past seven years than on any other. Some hon. Members might recalll that there was a "Nuclear Forum" three or four years ago when Lord Marshall spoke of the advantages of cheap French nuclear power. I intervened on the Secretary of State and on the hon. Member for Sheffield, Hallam (Sir J. Osborn) to talk about that.
I hope that the Secretary of State will ensure that the Minister confirms what I am about to say. Electricité de

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France's debt has now reached $33 billion, or 220 billion French francs, because is has spent a great deal more than it needed to spend on PWRs, with the result that the French have such an obscene surplus of electicity that they are selling cheaply in France, although that is changing rapidly, and at a dumped price through Sellinge.
What are we paying for French electricity? Does the Secretary of State think that it is fair trade? Does he believe that it complies with GATT? Does it comply with the treaty of Rome? It is a tremendous subsidy. If we reflected it by exporting coal to France, I calculate that we would sell at £6·50 a tonne. That would be absurd, but it would be equally absurd for us to allow the French to export their unemployment to us on the present scale.
The French have done in nuclear power, perhaps more expensively, what they did with eggs, turkeys, and golden delicious apple production, but this is a very much more serious matter. I hope the Minister will be able to deal with the anxieties expressed by my right hon. Friend the Member for Salford, East (Mr. Orme) and others about EDF's enormous deficit and confirm that the speeches that we have heard from Conservative Members and others for the past six years were not so well founded as was initially thought.
That is not the only thing that worries me. In January I chaired part of the nuclear hearing in Paris organised by the Council of Europe. It was quite obvious there that a number of people in Belgium, West Germany and Luxembourg were extremely unhappy about developments in France. They were worried that they, as close neighbours, had not been told all that they should have been told about the condition of the French nuclear industry. I was therefore especially worried when I saw that in 1979 at Gravelines the safety valves controlling cooling circuits showed the same faults as those which occurred at Three Mile Island.
I spend much of the year in Yorkshire, which is twice as far from the House as the Gravelines nuclear power station. The Government seem to be rather more concerned about the south-east of England than they are about areas such as mine, but are they concerned enough to ensure that all the faults which have occurred or might occur in French PWR reactors are properly notified to the United Kingdom? Gravelines, Chinon, Grenoble, Les Choux, Brenelis, St. Laurent, La Bugey and Cottenom are all French nuclear power stations where things have gone wrong, and we are a lot closer to them than we are to Chernobyl.
I do not want to get involved in scare talk and I am prepared to accept that it would be foolish to say for all time that there should never be any nuclear power. I think that the Secretary of State will agree that future generations will face the prospect of desolation if we do not hand on to them an adequate energy base, but there is no need for us to devote a huge part of our capital expenditure capacity to this particular form of power. Through a proper conservation programme we could save as much energy as the output of at least two of the five PWRs that the CEGB needs. We should ensure that we invest rather more quickly in the clean combustion of coal than we seem to be doing—and as an environmentalist I make no apology for insisting that it should be clean.
There is no need for us to surrender, as it were, the heritage of the nuclear research which has culminated in the AGR and which may in due course see the development of fusion, but at this stage there is no need
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for us to invest the amount of money which is currently in mind for PWR purposes. Last week some people made the preposterous claim that PWR reactors and nuclear power today had a clean bill of health. I hope that before the Secretary of State makes his decision he will not only take careful note of Sir Frank Layfield's reference to the need to study leukaemia in relation to Sizewell A but will look at the various references to the need for the studies and investigations recommended in the document about nuclear power and lukaemia.
I accept that, apart from the matter of liver cancer, the CEGB locations have been given a clean bill of health, but several of those stations are comparatively recent and proper weight should be attached to the situation in pre-1955 nuclear establishments. I do not want to labour the point because it would be wrong to indulge in sensational comment, but in those studies there are at least six references to the need for further investigation. If the scientists can produce a positive record of incidence and mortality from cancer, leukaemia and lymphoma, the House should insist that before any firm decision to have a family of pressurised water reactors the investigations mentioned in this document should be carried out.
I trust that the Secretary of State will pay heed not only to the arguments about energy, but to those about the need to maintain liberty in our societies and to ensure the health of future generations.
7.4 pm
Sir Trevor Skeet: I should say one thing in fairness to Electricite de France. At present EDF is not proceeding on the basis of capital contributions from the state, nor is it receiving any subsidies. The hon. Member for Wentworth (Mr. Hardy) mentioned leukaemia, which had not been mentioned before in the debate.
The United Kingdom has a population of over 50 million and our nuclear programme produces between 18 and 19 per cent. of our total electricity. France produces 76 per cent. of its total electricity by nuclear power and it has a population of 55 million. In Belgium, electricity generated by nuclear power is roughly 60 per cent. of the total, and the population is 9·8 million. In the United Kingdom we are disturbed by small cells of leukaemia appearing all over the country particularly in the vicinity of nuclear stations. Nobody in France or in Belgium is concerned about that, and those countries have substanial nuclear programmes and one has a bigger population.
I shall read a small extract from a report called "Cancer Incidence and Mortality in the Vicinity of Nuclear Installations, England and Wales, 1959–1980". The Opposition demanded that this should be brought to the House and it has now been brought here in draft form.
That report says:
"These values suggest the majority of positives occur by chance and that the presence of the nuclear installations is not a contributory factor."
That is on the first page of the report. Further on, the report says:
"the results for control locations strongly suggest that the positive results for nuclear installations are predominantly due to data biases and to random fluctuations rather than to local environment."
When we hear anything about this subject we will be able to say authoritatively that there is nothing at all in it at this stage.

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The Secretary of State is perfectly right to suggest that safety is the prime consideration. Several hon. Members have also said that. It is important to bear in mind what is in chapter 2 of the Layfield report. It says:
"the safety record of the CEGB is outstanding by any standards; … the CEGB and NII both possess a sufficiently high degree of engineering and managerial competence to ensure plant safety;".
Those are remarkable commendations from a report which took about four years to compile. That committee adduced erudite evidence, not merely from people from Britain but from abroad. Certain matters were reserved by the Layfield inquiry and were identified by the Nil as requiring clarification before a site licence could be issued. Of the 79 issues that have so far been identified 76 have now been resolved leaving only three outstanding. A number of matters were raised by the NII the protesters and other people and Layfield stated that these matters should be considered in depth. All but three have been resolved.
One matter worries me and my constituents. It is about Chernobyl, the RBMK reactor. However, at the Vienna conference Professor V. A. Legasov said that the type of damage caused by a faulty Chernobyl type reactor could not occur in the United Kingdom or in any of the West's reactors. It is interesting to note that the Russians have gone ahead with their nuclear power programme and want substantially to advance its capacity by 2000 AD. They have resorted to their own version of PWR for future construction.
The Chernobyl reactor is also different from the ones in the West because of its sudden injection of reactivity. My hon. Friend the Member for Renfrew, West and Inverclyde (Mrs. McCurley) referred earlier to the positive void coefficient that may make that reactor go supercritical. That is not possible with reactors in the United Kingdom. In fact, several years ago some of us went to look at the Canadian reactor system to see whether it was applicable to the United Kingdom. We came back and suggested that that system should not be accommodated here.
The steam-generated heavy water reactor, which is the nearest equivalent to the reactor in the Soviet Union, was accepted temporarily but was later rejected. We have therefore adopted the right course and not pursued a reactor design that could lead to disasters. I am perfectly satisfied with the safety arrangements outlined in the report and also that the CEGB and nuclear installations inspectorate can get together and lay down the appropriate conditions to safeguard the public.
Since the nuclear programme was commenced in the United Kingdom, the record of the CEGB has been remarkable, such has been the nature of the safety regulations imposed on the industry.
On economics, the first argument to which I give great weight relates to the diversification of fuel sources. At present coal-fired plants dominate the CEGB system, but prudence demands a broader fuel base. There is also a need to prevent the demise of an important technological industry in the United Kingdom, because the teams could disperse if Sizewell is not ordered. It is important to establish a new line of PWRs with the most up-to-date technology. Such reactors could be exported at a much later date. The Kraftwerk Union borrowed its ideas partly from France and partly from Westinghouse in the United States. EDF in France borrowed its ideas from
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Westinghouse. It has added its own ideas, and ultimately has arranged for valuable disposal on the export market. That has been attractive. I have no doubt that once we have more experience of this type of reactor, we shall be able to do the same.
In my judgment the economics still favourable to Sizewell. In part, economics will be determined by the movement of prices in competitive fuels. The calculations require that such prices will have to be accurately gauged over the life of the plant—from 1995 to 2035—but not on the basis of immediate market trends.
The right hon. Member for Salford, East (Mr. Orme) said that because of two years of falling oil and coal prices he could project forward accurately over the next 40 years. That is absurd. In other words, the right hon. Gentleman is now drawing conclusions as to why we should not go ahead with the building of a nuclear power station in 1988 so that it can be ready for commissioning in 1995.
It is important to bear in mind that the capacity is warranted and that it must be available in 1995. The right hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Steel) asked why we should not consider the Severn barrage. While that might provide its full power, it would not do so until the year 2000 or 2005. Therefore, it would not be able to provide the additional capacity that the CEGB require at the right time.
According to chapter 70 of the Layfield report, international coal prices are accepted as the proper basis for economic appraisal in national resource terms, but it should not be forgotten that British coal prices are controlled by a variety of domestic factors. The CEGB pays £42 a tonne for its coal, but gets its third tranche at world prices. Yet that amounts to only 12 million tonnes. Therefore, it is almost totally insulated from the world market. Furthermore, British Coal is subsidised to the tune of £6 a tonne. If we delve even deeper, we will see that it is subsidised even more heavily, and that disruptive factor will cause great difficulty when making any realistic comparisons.
It is useful to calculate on the basis of world prices, as that avoids going into the complications of the coal industry, but those of us in the House who have been brought up on coal Bills know that the problem is much more complicated.
It has also been said that the price of nuclear power stations has escalated from,£1 billion to just over £1·5 billion. I agree that that is a considerable sum, but we should bear in mind the fact that the coal industry has also been subject to escalating costs and expensive outlays. The desulphurisation of flue gases is very expensive indeed. No decision has yet been taken on the removal of NOx, and until that problem is solved no new coal-fired power stations can be brought into operation. NOx may act as a catalyst with sulphur dioxide, causing destruction of fish and trees.
Mr. Barron: I agree with what the hon. Gentleman is saying, but is not that an easier problem to solve than the dumping of nuclear waste in Bedfordshire?
Sir Trevor Skeet: I am glad that the hon. Gentleman' has raised the problem of nuclear waste. I have never advocated that it should go to Bedfordshire—[HON. MEMBERS: "Oh!"] Obviously the hon. Gentleman did not hear me when I last spoke on the subject. The Layfield report says that nuclear waste can be kept at Sizewell B

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throughout the entire life of the power station. If that is correct, the waste would never come to Bedfordshire. I also recommended Bradwell and Fulbeck as two places to which the waste could go. However, I do not want to deviate too much from my main argument.
Carbon dioxide remains an environmental problem with fossil fuels. That has been partially explained, and in time, if there is to be increased coal-burning across western Europe, we shall have to find some way of containing its emission.
In addition, the recommendations of the Waddilove report on compensation for subsidence have never been faced. In underground mining, that could be desperately expensive, and I dare say that costings will have to be reflected in the price of coal. Even with substantial mechanisation, mining is still labour-intensive, high-cost, and liable to disruption.
As the Secretary of State will no doubt remind the House if he has the opportunity, last year we had great difficulties with miners in certain parts of the country, and had it not been for nuclear and oil-fired power stations, all the lights of the country would have gone out.
Mr. Frank Cook: That is rubbish.
Sir Trevor Skeet: The hon. Gentleman knows that it is the truth. If only Labour Members faced the facts of life, they would not in some cases be such idiots. I hope that I have not been too disrespectful, but if I have, I willingly withdraw what I have just said.
Another factor that adds to the price of coal is the increase in underground mining costs due to safety arrangements. However, I pay tribute to the miners for the way in which they have increased productivity. I have come to the conclusion that, while oil prices are to some extent a determining factor for coal, the real price of coal on the world market could be affected by increases in supply which would unsettle prices, albeit temporarily. The price on the United Kingdom market during the life of Sizewell, that is 1995 to 2035, which is the key matter, is likely to be on the upward grade. That is all that we have to establish.
The performance of exchange rates, which is also crucial to turning dollar prices into pounds, will be totally unpredictable during that 40 years. No one, apart from Layfield, would venture to conjecture on that. Between 1995 and 2035 the price of crude oil, and hence that of petroleum products, specifically fuel, will probably also be upwards as supplies diminish.
Having examined the Sizewell report carefully, I came to the conclusion that, fuel-wise, Layfield has made out a strong case and that the Central Electricity Generating Board, while it has been a bit too optimistic, has nevertheless reached a satisfactory position.
I reflect once again on the French. The Electricité de France nuclear construction programme could remain profitable for the French, right down to the price of $5 a barrel, never mind the fact that their programme is substantially based on the PWR. We are not likely to find that in the United Kingdom.
I do not wish to take too much time over this, but I shall finish by mentioning one or two points. Today we have been told by some hon. Members who are against the recommendations for Sizewell B that the nuclear industry is totally unsafe. We have been told by a Welsh
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Conservative Member, my hon. Friend the Member for Clwyd, South-West (Mr. Harvey) that he does not wish to see Sizewell B brought into operation.
In 1986, 21 power reactors were completed in eight states. Today, the world total is 394 nuclear plants. If the International Atomic Energy Agency figures—
Mr. Frank Cook: How many have been cancelled?
Sir Trevor Skeet: Nuclear is providing 15 per cent. of world electricity. There were cancellations in the United States due to interest rates and over-ordering. I shall not deal with those factors today. Twenty-six countries generate electricity by nuclear power plants in which the PWRs predominate. That is the world scene. Twenty-six countries the world over use nuclear power. PWRs is the system in vogue and it is the one that we may accept in the United Kingdom. The French, under Electricite de France, the Germans under their Kraftwerk Union, and Westinghouse of the United States have all made improvements. If we accept this model, we shall accept it with all those improvements vested in it.
It is important that we consider that. Yes, in the United States high interest rates and over-capacity in the days when they ordered too many nuclear reactors has affected matters, but between 1953 and 1979 orders for fossil fuel power stations were cancelled in the United States in exactly the same way as those for nuclear power stations. However, since Three Mile Island, 62 new nuclear power stations have been ordered in other countries and 113 of those were under construction in 1979 and have now been completed.
Finally, the Liberals tell us that we must turn to other methods. Will they have us put up some windmills to get a power station the size of Sizewell B? Three thousand of these windmills would be required, 500m apart. The ground coverage would be 27 sq km. What an environmental eyesore that would be! It would be totally unacceptable.
Mr. Steel: No one suggested that. I hope that the hon. Gentleman will not indulge in the old trick of putting forward views that no hon. Member has advanced in the House just to knock them down.
Sir Trevor Skeet: It is interesting that the right hon. Gentleman mentioned the Severn barrage. I told him that it would not reach full power until after the year 2000, and that the power was required by 1995. Therefore, it would pass the peak time when it was required. That is why it is essential to get going now, well before 1990, so that it can be commissioned by about 1995.
The most practicable solution of the lot is that we should import more electricity from France. A 2,000 MW line could be doubled to get more electricity. Layfield recommends that course. Chapter 62, paragraph 19 states:
the possibility of further links, with France in particular, should be actively reviewed … the cheapness of some electricity generated in France might make it economic to construct further interconnection capacity"
One might consider that, but the miners have cause to reflect that the French can market electricity in the United Kingdom at costs below that of our production. Would they suggest that that course should be followed? If we took any of the other alternative methods, even if money were spent on them, we could not produce the electricity that we require to keep the lamps burning and to keep

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industry productive on the scale required. None of that could be produced by 2000AD and the hon. Gentleman knows that.
Mr. Frank Cook: The hon. Gentleman has referred to the fact that the French can supply electricity at a lower cost than that produced by fossil fuels in this country. Will he tell us whether he is privy to cost figures that are not available to Labour Members in referring to the cost of electricity here?
Sir Trevor Skeet: I must be careful, because I have spoken for some time. I am prepared to talk with the hon. Gentleman on some other occasion. I am interested in the price of French electricity. I have been over to France and I have seen their network. It is most admirable that they have kept it. A Socialist Government came into power in France and promised to close it all down, but they kept it all going. That must be good and so must be the PWRs that we are seeking to get for the United Kingdom.
7.28 pm
Mr. Frank Cook: I have seen that we are destined to conduct our exchanges this evening under three shadows. Those shadows are three refusals. The first refusal was that of the Secretary of State to comment on the Layfield report or to answer questions upon it and, in fact, his refusal to speak for more than six minutes on it which, doubtless, was easy for him, as he had said that he had yet to make his decision. I am yet to be convinced that a decision is not yet made.
The second shadow is the refusal of the Government to heed the plea of my right hon. Friend the Member for Islwyn (Mr. Kinnock) when he begged the Leader of the House to table a reasoned and considered motion that could be subject to reasoned and considered amendment. Doubtless that tactic could be excused rationally by the Secretary of State's already recorded statement that he had yet to make his decision. However, I remind the House that it is also an excuse that allows hon. Members anywhere in the House, but particularly, it would seem, Conservative Members, to talk about any particular aspect of nuclear energy that they choose to seize upon.
I remind the House that tonight we are discussing the Layfield report and particularly the pressurised water reactor that is supposedly destined for Sizewell. Even that is not the biggest shadow. I suggest that the biggest shadow was the refusal of the head of the Central Electricity Generating Board, Lord Marshall, himself to present the CEGB's case at the inquiry. I am not one of those who would suggest that there was any conflict of interest between the principal procurer and the potential provider of this particular type of reactor—far be it from me to do so—but I find it astonishing that the noble Lord, who is acknowledged as one our foremost authorities on nuclear energy in all its forms, should refuse to present his case at an inquiry of this nature and thereby refuse to submit himself to examination.
Tonight we have a major responsibility which we should not shirk, even though it may go against party political lines. That responsibility is for the safety of the British public. We must decide whether to go ahead with a completely different type of nuclear reactor, the PWR. This step marks a major shift away from designs which we have previously used. Nuclear reactors generate electricity, but they are unlike any other power stations in that they
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contain within the reactor core a colossal amount of radioactivity which poses particularly difficult problems for both the designers of the plants and the engineers who build and operate them.
I used to work in the nuclear industry, so I speak with some knowledge of the truth about the safety and the design of plants. Some hon. Members would like to label me anti-nuclear. I reject that label because I am in favour of technology so long as it can be proven to be safe and to bring benefit to human beings. Hon. Members will recall that I denied the anti-nuclear label and said that it was as silly to refer to me as anti-nuc as it would be to refer to me as anti-food because I happened to be against food poisoning. Nevertheless, I remain unconvinced by nuclear power plants, in particular by the PWR.
Few people have seen a PWR and understand what is going on in its core. At the heart is a massive steel pressure vessel about 35 ft high and 15 ft in diameter. Inside there are about 40,000 fuel elements which produce a power density in parts of the core as high as 250 kW per litre during operation. That is like the heat from 140 single bar electric fires coming from a pint milk bottle. The amount of heat is colossal, which is why the whole reactor must be pressurised up to 150 times atmospheric pressure and why the reactor must be kept cool at all times. About 20 tonnes of water must pass through the core every second. The PWR is an engineering challenge, if nothing else.
The PWR is designed in that way because, originally, it needed to be compact to fit inside a submarine. Some senior people in the nuclear industry have pointed out that what is good for a submarine in not necessarily good for an electrical power plant on land. Indeed, Sir Francis Tombs, the managing director of Rolls-Royce, which makes PWRs for our submarines, made that very point in a letter to a certain publication printed at Wapping. The late Professor Ned Franklin, former managing director of the National Nuclear Corporation, also criticised the PWR. I hope that Conservative Members who have been giving us a blizzard of bland assurances tonight will listen to this. In November 1986 he wrote that he opposed the construction of PWRs in the United Kingdom because they were
"not sufficiently operator friendly under accident conditions … This view is based on a lifetime's experience which indicates that when operators are subject to conditions of extreme emergency … they will react in ways which lead to a high risk of promoting accidents rather than diminishing them. This is materially increased if operators are aware of the very small time margins available to them. What is definitely intrinsic for water-cooled systems is that the drive for economy leads to high fuel ratings and to an extremely rapid sequence of events, given an initiation such as a loss of coolant accident. The times available for intervention are such that the reactor has become a 'fly-by-wire' device rather than piloted one."
I remind the House that that comment comes from a man who spent a lifetime in the nuclear industry and who supported nuclear power to the end. His remarks relate specifically to the PWR. So much for the blizzard of bland assurances.
The PWR places major demands on the engineers in order to get the core cooling emergency systems right. Frankly, human operators cannot react sufficiently quickly. Instead of the minutes and hours that operators have at their disposal to react to accidents at AGRs and Magnox reactors, only seconds are available with the PWR. If human reaction is too slow and we do not feel that we can ask for such a rapid response from the

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operator, we must lock him out of the system. Then we become wholly dependent on a computer-guided system which can never possibly be acquainted with all the sets of circumstances that may arise. Therefore, in the light of all those extra demands on safety, how well, in the eyes of Layfield and others, does the PWR do?
Like most people from time to time I have taken my car in for an MOT test. When I do so, I do not say, "I am sorry but this is not the final design of my car. I want you to MOT it. Test what you have there and let me know whether the rest of it is in good shape too." With Sizewell B, that is exactly what the CEGB has done. As Layfield himself said:
"I was not able to base my conclusions on a final safety case"—
why not?—
"as none was submitted."
Nobody has seen the final design for Sizewell B, apart from the CEGB and the NII. Indeed, design modifications are still going on. Did Sizewell B pass its MOT test at the inquiry? The answer is no, it did not and never could have done. Layfield admits that the design was
"incomplete and not yet susceptible of a final assessment of its safety."
That is an extraordinary state of affairs when the design work for the proposal started back in 1979 and when we were promised that a final design for the reactor would be available before the start of the inquiry in January 1983. If anybody is under an illusion that Layfield passed Sizewell B on safety grounds, let me put them straight: what he did was to pass the buck to the CEGB and the NII to sort the matter out afterwards.
I do not suppose that many hon. Members have gone through the full details of the Layfield report and I would not expect them to. I suspect that most have read about it in the newspapers or glanced at some of the recommendations and conclusions. Close scrutiny of the report, particularly of the safety of the plant, does not give the real confidence needed to vote yes to Sizewell B at this stage.
Let me take up one or two aspects of the safety issue. Let us take the reactor pressure vessel which, if it fails, would have catastrophic consequences. Nobody would dispute that. Did the CEGB's evidence prove that it could meet the safety standards of an accident once in 10 million years of reactor operation? The answer is no. Layfield called on an independent assessor, Professor Kletz, who pointed out that, on a strict statistical basis, the absence of a failure so far could only support the conclusion that the true annual failure probability was less than 6·4 per million per year. Sir Frank, in his ultimate wisdom—or otherwise—decided that he was impressed by the work that the CEGB had done and that as far as he was concerned the CEGB could be trusted to achieve the safety standards which it had set.
Let us turn to the steam generators, which are a fundamental part of the cooling system. Layfield admits that
"it is impossible to say whether the model F steam generator as proposed by the CEGB for Sizewell B, will prove to be reliable or not."
What is his solution to this? It is simply to turn yet again to the CEGB, the credentials of which he accepts and regards as adequate to reach the required safety standards.
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What about fuel clad ballooning? There can be swelling of fuel elements which restricts cooling and can lead to melting of the fuel itself. Layfield admits that the nuclear installations inspectorate was not satisfied at the end of the inquiry and that some matters still remained unsolved.
Let us consider loss of coolant accidents, the biggest of which we saw at Chernobyl. That happened after March 1985. Layfield admits that there were major uncertainties in the CEGB's analysis of LOCAs—loss of coolant accidents. The nuclear installations inspectorate regarded the CEGB's work as
"a significant advance towards an adequate safety case, but was not yet entirely satisfactory."
Time and time again Sir Frank has ducked his responsibilities on safety, with all the major uncertainties outstanding, by simply passing the buck to the NII and the CEGB.
Mr. Forman: The technologies which the hon. Member is discussing are, almost by definition, impossible to be totally sure about because of their complexity and safety. Does he not see the strength of Sir Frank Layfield basing his judgment on the best expertise available at the time?
Mr. Cook: I take the point without reservation, but allow me to tell the hon. Gentleman about the scientists on both sides of the Atlantic and around the globe who have stated categorically that research and development finished too soon and that production started too early. We have not advanced the technology to the stage where we can safely put it into operation. If the hon. Gentleman listens further, I shall continue to prove just that.
One of the fundamental issues at the Sizewell inquiry was the question of risk. What level of risk is acceptable to hon. Members, to me or to the general public? The CEGB thought that one in a million was an "acceptable" level of risk. What does one in a million really mean? It is intended to tell us that an accident simply could not happen. Well, the accident at Three Mile island—TMI as we are told to refer to it—did happen. The clean-up costs are estimated at $1 billion—about $300 million more than the plant cost to build. The accident at Chernobyl did happen. So far 31 people are dead, over 200 people are still seriously ill and between 10,000 and 50,000 long-term cancers are expected. Clean-up costs in Russian are already over £2·5 billion, and over £3·5 million has been paid to sheep farmers in the United Kingdom.
There have been two major accidents in seven years—one in a capitalist country with a PWR, the other in a Communist country with a pressure tube reactor. Even if we believe all the CEGB's risk estimates, one in a million is still not acceptable. We cannot afford a single such accident. Such an accident would devastate the United Kingdom and our continental neighbours and have appalling consequences for the national economy.
The industry's assertion, and the Government's response to all this, is to say that such an accident could not happen here. What arrogance. What misguided belief in the supremacy of technology and the ability of humans to be perfect.
At the post-Chernobyl conference in Vienna last August, Dr. Morris Rosen of the International Atomic Energy Authority was a damned sight more honest than many of our own scientists. He told reporters:
"I might say that one of these accidents could happen once every ten years. I might say it could happen every year. If you

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did the figures you might still find nuclear safer. You're going to have to tell me whether that's acceptable or not. All I can say is that there were two accidents in seven years."
I ask the House to think about that for a moment. Rosen was saying that a major nuclear accident every 10 years might be acceptable. "Acceptable", or, in the words of Layfield, "tolerable"? I do not think so and I doubt whether my constituents do.
The CEGB has to convince me and my constituents that an accident like Chernobyl or Three Mile Island could never happen in this country. We have a right to demand this because a nuclear reactor is not like coal-fired station, a gas turbine, or a wind or wave generator. Coal miners, like uranium miners, suffer illness and death. The safety record has improved and it must continue to improve.
Comparing the complete coal and nuclear fuel cycles, Layfield concluded that the risks appeared to be of a similar magnitude. However, nuclear reactors have the potential for catastrophic consequences. That is what makes them so different. They have a capacity not just to harm workers, or people living near a plant, but to harm people living hundreds of miles away, and future generations through genetic disease and the exposure of children in the womb.
Three Mile Island and Chernobyl are warnings to us that we have not yet tamed this technology. Layfield has not been able to prove that we have tamed it. Arguments about jobs, the price of electricity and France are, frankly, incidental compared with safety. From the CEGB we are offered only one thing—surised water reactor, plus a lot of delay in order plant for future coal-fired stations— delay designed, perhaps, to exert pressure towards acceptance of the PWR proposals.
In regard to that, I should like to record the concern of the national organiser of the engineering union, TASS, Mr. Keith Sneddon, who said:
"While the nuclear debate continues, the industry is spiralling downwards, causing even more job losses in areas of already massive unemployment. Without the orders, Britain will soon find itself having to rely on imported power equipment."
I commend national organiser Sneddon of TASS for those thoughts.
I remind the House that today we not only put ourselves in prospect of importing power equipment, but we debate our intention to rely on imported power technology.
Sir Frank stated that he was impressed by the confidence of the CEGB and the NII Does the performance of those organisations justify that confidence? Let us take the NII I have a great deal of respect for the NII and for the difficult job it must do. However, it is seriously under-staffed, with 23 fewer inspectors than it requires. Even at full strength, we have far fewer inspectors per nuclear plant than many other countries. Less than four weeks ago, in giving evidence to the Select Committee on Employment, senior representatives of the Health and Safety Executive confessed the difficulty they had in obtaining staff with appropriate qualifications of acceptable standards. The NII is under-funded and underpaid.
Until recently it worked hand in glove with the nuclear industry. As John Rimmington of the Health and Safety Executive admitted, some of his inspectors may have "gone native" in the past and not been sufficiently rigorous in their oversight of the plants. The Health and Safety Executive's extremely critical report on BNFL at
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Sellafield, which was published last year and which threatened closure of the plant, was an indictment of its performance. Having made many criticisms of BNFL's safety standards in 1981, the Health and Safety Executive allowed it to get away with things for a full five years before public outcry, after a spate of accidents at Sellafield forced the Executive to act. That critical report was as much an admission of its failure on safety matters as BNFL's. I consider that the NII is still on trial as to whether it is to be regarded as truly independent of the nuclear industry and standing up for public safety.
Future generations will not thank the House for lacking the courage of its convictions tonight. It is not enough for hon. Members simply to troop through the Division Lobbies tonight like a bunch of radioactive sheep— 300,000 of which are still banned from human consumption in this country, 10 months after Chernobyl.
The House should reject the Sizewell proposals and get started with tackling the real energy problems in this country. Sizewell B is nothing more than an enormous white elephant, which the CEGB, like a spoilt child, does not want to give up even when every reason for building it has disappeared.
In relation to the bland assurances that we have received tonight, Conservative Members should listen to the words— it is fitting that they should be the final words— of the man who was the father of the PWR, Admiral Hyman Rickover. In 1962, when he addressed the House of Representatives and confessed his fatherhood of the PWR, he said:
"I'm not proud of the part I played in it— the most important thing we could do now is to start having an international meeting where we first outlaw nuclear weapons then we outlaw nuclear reactors too."
Our meeting is hardly international, but let the House heed Admiral Rickover today as it ponders the proposals for the adoption of his bastard child.
7.52 pm
Mr. Nigel Forman: In one respect I aim markedly to depart from the hon. Member for Stockton, North (Mr. Cook), in that I shall not seek to emulate his rather disagreeable tone.
The purpose of this debate is consultative. It is an opportunity for hon. Members on both sides of the House to make brief, perhaps well-chosen remarks of benefit, one hopes, to Ministers and the Government.
In the first place, was Layfield asked to address the right questions? If one considers the terms of reference, originally given in a written answer on 21 July 1981 in column 126–127 of the Official Report, it is fairly clear that, essentially, Layfield was asked to involve himself in something in which he already had considered expertise— a detailed and extensive planning inquiry. However, right from the start, according to the terms of reference, inadequate attention was paid to the broader issues of energy policy and their possible impact upon the wider political and ecological environment.
Secondly, one needs to ask whether Layfield gave satisfactory answers within the terms of reference as stated in that written answer. I believe that the honest response to that must be "Yes, but" and "but" is the important word. Having listened to various hon. Members, it is clear that the economic argument and the economic conclusion reached by Layfield depend critically on three factors: first, the future cost of other fuels and other energy

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technologies; secondly, the future level of interest rates and the appropriate discount rate that would be connected to those interest rates; thirdly, the ability of the constructors to build such reactors as Sizewell B to time and to cost. The "but" in the affirmative is therefore almost as important as the affirmative itself.
When one considers the safety aspect, it is clear that the conclusions reached by Layfield depend on three equally important factors. The first—this was brought out by the hon. Member for Stockton, North who is no longer in the Chamber—is the degree to which it is appropriate for Layfield to have placed such trust in the CEGB operators and the NII supervisors of this technology. If one reads the summary volume of the Layfield report— I freely admit that I have not had the time, due to my busy parliamentary duties, to read much more than that—it is clear that a process of conceptual narrowing took place in the course of the report. When one studies the concluding volume, it is clear that the focus of attention is on the generating process only. If one focuses on that, different conclusions are reached from those which would flow from the entire nuclear fuel cycle and attendant matters.
The safety argument also depends on credibility and public acceptability. The heroic task undertaken by Layfield was to seek to balance the alleged economic benefits that he thought he saw in such a reactor choice against incalculable safety risks—I am sure that Layfield would admit to that.
With regard to such risks, it is well to remember the remarks of the distinguished Swedish scientist Hannes Alfven, that the real dilemma in the calculus between cost and risk with regard to nuclear power and many other advanced technologies may be summarised in the question: "How do you put an acceptable probability on an unacceptable risk?" That leads me to ask whether there are any other questions that the Layfield inquiry or a wider, similar inquiry should have addressed, but, apparently, did not address in sufficient detail in this inquiry, long though it was. I believe that there are.
The central question that underlay the nine volumes, but which does not seem to have been addressed in sufficient clarity, at any rate in the conclusions reached by Sir Frank, is what would be the implications of going nuclear with a family of PWRs. I know that it was described as a small family and that in the relevant parts of the report it spoke only of four or five other reactors—a small "nuclear family" if you, Mr. Deputy Speaker, will pardon the pun. It is that to which we should address attention.
If, in the light of consultations, the House and the Government go ahead with Sizewell B, no one assumes that it will stop there. Indeed, the CEGB has never said as much. How would such a development, a family of PWRs, affect the economic and safety case and the levels of public acceptability? I would hazard a guess that the economic case would be impoved by going forward to series ordering. That is score one in favour of Layfield. On the other hand, the safety case would move in an unfavourable direction as a result of series ordering, if only for the rather simple arithmetical reason that the more reactors and the more of these complicated processes we have, the more possibility there is for human error and the greater the risks, other things being equal.
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The third consideration that arises from series ordering is the level of public acceptability. I suspect that the problem of achieving public acceptability would increase when reactors of this sort became more common and were to be found in more places, sometimes sited closer to large pockets of population. The CEGB has been careful over the years to follow a remote siting policy, but on islands such as ours the possibility of following that policy ad infinitum is not all that great. There is a small recommendation in the Layfield report which is worthy of the Government's attention. It is the idea that it might be wise to provide in central Government financial controls on local government for the emulation of that which takes place in France. We know that the Electricite de France subsidises to a considerable extent to make nuclear siting worth the while of local authorities. In areas where French nuclear installations exist, EDF ensures that the authorities receive some direct financial benefit from what is otherwise centralised technology.
There are a number of other issues that, in the interests of time, I can only touch on. These are issues that should have been addressed more fully in the report. For example, I think that the House and the country would like to know more fully the implications for the AGR programme if we are to go ahead with a nuclear family of PWRs. I suspect that it would mean effectively the slow demise of that programme. The House has already considered the implications for the coal programme. One of the strongest parts of the Layfield report is the section that makes it clear that it is possible to run a continuing and modern coal programme in tandem with a small family of PWRs. When it comes to the more fanciful ambitions of some members of the pro-nuclear lobby, they are looking to a future in which coal plays only a small long-term role and nuclear power becomes the dominant factor. I would prefer a more even balance between the two sources of energy.
Finally, there are implications for energy policy generally. In that context it would have been salutary for the report to address to a greater extent than at present the key question of the implications of not going nuclear. The Swedish example, and some of the work done some years ago by Gerald Leach in his excellent book which hon. Members may have read, which is entitled "A Low Energy Strategy for the United Kingdom", should have been brought into play much more.
I do not have time to set out fully my views on energy policy issues in the context of the Layfield report in what must be a short speech tonight. Suffice it to say—I shall put my views in shorthand for hon. Members—that I think we should opt for what could loosely be described as a six-fuel economy. That is the path of prudence and flexibility. This means coal and nuclear power, chiefly for the production of electricity; oil and gas, recognising that they are finite, and alternative sources on a much more advanced and adventurous scale. There should also be a healthy slug of conservation, to an extent that even this Government have not yet managed. If we had a prudent, judicious and flexible policy that used all these mechanisms, acting both on the supply side and the demand side, we would carry public confidence much more readily with us.
My last point is more methodological than previous ones. In spite of the intelligence and hard work of Sir Frank Layfield and all those who worked with him on this lengthy report, I do not believe that a glorified planning

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inquiry under section 40 of the Town and Country Planning Act 1971 is the appropriate way in which to address such momentous issues. I have come firmly to that conclusion. I know that it is easy to say that now, but it is as well to get this on the record. I think that instead there should have been a full-blown and comprehensive inquiry into future energy needs. That was the key issue. Consideration should then have been given to the costs and benefits of the various ways of meeting those needs. That points much more to the traditional and now out-of-favour institutional model of a Royal Commission than to the course which was followed.
The House is being asked to offer its views on what is a gigantic, but conceptually limited inquiry, which is inspired by what I shall describe as the doctrine of the limited case—in other words, one reactor in one place at one time. None the less, in the fulness of time it will constitute a definitive test for PWR-type approval. Let no one imagine that we shall go through this long rigmarole again. Future Governments of whatever party will say, "PWR type-approval was settled at the Sizewell inquiry and that will be the end of it."
Successive Governments have chosen effectively to demonstrate, first in the Parker inquiry into reprocessing at Windscale and now in the Layfield inquiry into Sizewell B, that, in the lapidary words of chapter 47, paragraph 62 of the report:
"there is nothing fundamentally secret or sinister about civil nuclear power in the UK."
I suggest that, because public acceptability is the crucial test in the end, and because the public do not yet appear to be convinced of or reassured by the statement to which I have just referred, Ministers will be wise to proceed cautiously to what might be predominantly a nuclear electric future.
8.7 pm
Mr. Jeremy Corbyn: This is an important and timely debate. It is worth while to take up the remarks of the hon. Member for Carshalton and Wallington (Mr. Forman) for a while, to think about the public inquiry system, and to ask ourselves whether it is a fair way of assessing a decision of major national importance.
Is it right that we should appoint one person, with assessors, to sit for such a long time to prepare such a report? Was Sir Frank Layfield in a position to hear balanced opinion? He had before him representatives of the CEGB and British Nuclear Fuels Ltd. In support of them was the lobby of the electric power industry and the nuclear power industry. Against that representation were the interest groups and pressure groups, which had largely to be self-financing throughout the inquiry. In common with other hon. Members, I received today a letter from Mr. N. O. Ratcliff, the chairman of the Joint Parish Councils Sizewell B Committee. The committee represented Middleton-cum-Fordley, Theberton and Eastbridge, and Yoxford. The letter makes it clear that in making its submissions, the committee was forced to finance all its efforts itself. Having experienced road inquiries in the past, I ask whether it is a fair system of inquiry when objectors are expected to employ their own barristers, call their own expert witnesses and marshal their own evidence, generally in opposition to something that in essence has been decided upon by the Government in advance and promoted by Government agencies.
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The amount of publicity and propaganda that has been pursued by British Nuclear Fuels Ltd. and the CEGB in support of nuclear power as a concept has been enormous and overwhelming. That pressure, influence and that lobbying leads us on to the research programmes of the Department of Energy, which deliberately underfunds research into possible renewable sources of energy, advanced coal-fired power stations and other options. The result is that we are led inexorably towards the conclusion that only nuclear power can solve our energy problems. This pressure is to be found within the EEC generally and not only within Great Britain. Energy predictions deliberately understate the reserves of coal in Europe by ignoring the coal that is underground in the pits that have been closed. This pushes the EEC more and more in the direction of coming to the conclusion that only nuclear power can solve Europe's energy needs.
Apparently the Secretary of State is listening to the debate and taking notes. That being so, I find it surprising that he has not been in his place for most of the debate. Secondly, it is scarcely credible that he has not made up his mind whether to order the go-ahead for Sizewell, despite the serious reservations that were expressed throughout the inquiry and in part of the report that was prepared and produced by Sir Frank Layfield.
The terms of reference of the report mention the need for a debate about the energy needs of this country and their widest consequences. We are not taking a decision just about Sizewell. Indeed, we are not taking a decision at all. The Secretary of State will be taking the decision at some future date. We are really taking a decision about nuclear power in the long-term future of this country and about energy needs for a long time to come. This is very much a turning point and an awful lot hinges on the decision.
I am one of those people who are extremely sceptical of the claim that nuclear power is inherently safe. I am one of those who are sceptical of the claims that there have been no serious accidents at nuclear power stations in this country or elsewhere. In the case of the Chernobyl accident, as many hon. Members have repeated many times, there have been a large number of deaths already, there are several thousand people seriously ill in hospitals in the Soviet Union and there are unquantified future cancers throughout the whole of western and eastern Europe as a result of one nuclear accident over 2,000 miles away.
It is true that nobody died immediately from the accident at Three Mile Island. It is also true that no one died immediately at Idaho Falls in 1961 or as a result of accidents that happened at Windscale. However, we have seen the storing up of cancers for a long time to come and the inherent secrecy of the way in which the nuclear power industry seeks to operate.
I have before me eight pages dealing with some of the major accidents that have happened at Windscale, now renamed Sellafield. That is supposed to be a safe nuclear plant. All those accidents have been reported and quantified somewhere. If the Minister or the hon. Member for Bedfordshire, North (Sir T. Skeet) or hon. Members from other places say that nuclear power is safe and that leukaemia risks are minimal, I refer them to what Sir Frank said about that. He said:
"I make the following observations: data on leukaemia in all workers and former workers at Sizewell A should be assembled over as long a period as possible and analysed with

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a view to establishing whether there are any grounds for suspecting the action of a specific cause associated with Sizewell A power station".
He goes on to say that similar data should be assessed in conjuction with all other CEGB nuclear power stations. He also says:
"if action has not already been taken on the fifth recommendation of the Black Report to arrange coordination centrally for monitoring small area statistics on cancer and hereditary diseases around major installations such as power stations, then the Office of Population Censuses and Surveys and the Medical Research Council should be asked to undertake that co-ordination work as soon as possible."
That is a serious recommendation by Sir Frank. It is a serious matter.
The research that has always been done on cancers around the Sellafield plant, pollution of the Irish sea, problems that fishermen and fish stocks have suffered in the Irish sea, leukaema on the Antrim coast of Northern Ireland or the coast of the Republic of Ireland, shows some of the dangers of the nuclear reprocessing industry. People may say, "The nuclear reprocessing industry is not what we are talking about today." In reality, that is very much what we are talking about. If we decide to go ahead with the development of the nuclear power station at Sizewell it will mean development of the reprocessing industry and, in turn, a development of the importation of uranium, the transport of that uranium and a further development of the whole industry and the pollution that automatically goes with it.
We are leading ourselves into a chain reaction. The nuclear chain starts with the exploitation of uranium mining in Namibia, Australia and other countries. It starts with the destruction of the lifestyle of aboriginal people in Australia and the corruption of the political system in those countries by that end of the nuclear industry. It then goes on to the transport of uranium to western Europe, initially as fuel for nuclear power stations. That then goes for reprocessing and some of it eventually becomes nuclear weapons through the development of plutonium. It also leads to a problem of nuclear waste.
I recall, not so many months ago, a group of Conservative Members getting up one after another saying, "Please, no nuclear waste dump in my constituency. Put it some place else." The problem is that it will have to go somewhere if we decide to continue the expansion of the nuclear power industry. Pollution is inevitable. When hon. Members say that the waste can be stored for the lifetime of the power station, I ask the simple questions: what happens when the life of that power station has been spent? What happens when the power station is no longer there? Is it all to be bricked in and concreted over? Is the land to be declared unfit for human habitation for many years to come? We have to assess some of the dangers of nuclear power.
There is another aspect which, perhaps, is not so obvious to many hon. Members. The concern about the nuclear power industry goes far and wide. There is not just the danger of nuclear power stations or what happens to uranium mining sources, but the transport of nuclear waste. A nuclear waste train passes through my constituency three or four times a week. That causes a great deal of worry. The nuclear waste passes playgrounds of the schools in my area and in the constituency of Islington, South and Finsbury and many other
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constituencies. There is a legitimate concern about the safety of those trains and the transport of that sort of nuclear waste.
There are not just those immediate dangers from the nuclear power industry but the loss of civil liberty that occurs because of the determined secrecy of the nuclear industry, the determination to push through the policies and the determination of that industry to be able to provide plutonium for the development of nuclear warheads. What we have seen in France, where the CRS riot troops have been used to break up the smallest demonstrations against the development of nuclear power stations, and the antics of the police in this country concerning nuclear power, begins to show us what is in store in the long term.
One Conservative Member rather gave the game away earlier. He was talking about nuclear power and the reliability of coal-fired power stations. He and other hon. Members know perfectly well that the problems of acid rain can be largely overcome. They could be overcome if more research was put into coal-fired power stations and if high-temperature burning and more efficient coal-fired power stations could be developed.
There is a political purpose in the development of nuclear power and I believe that that is the determination of the Government, which is well catalogued for a long time, to break the power of organised labour in the energy industry and to break the National Union of Mineworkers during that year-long strike. Opposition Members know what went on during that strike. Conservative Members and the Secretary of State for the Environment know what he was doing in 1978 in his development of the famous Ridley plan to take on and break the mineworkers' union. One of the motives— not the only one— in the development of nuclear power is a way of trying to break organised labour in the mining industry and in any other energy industry.
We have to look at the alternatives for the future. It has been said that there is no alternative other than the development of nuclear power. This country has large reserves of coal. We could use that coal far more efficiently and get a far quicker cost-benefit return if we invested money in the conservation of energy rather than the development of large new power stations immediately. Conservation of energy would be far more useful and of far more immediate benefit to consumers and people suffering high electricity bills at present. We also need far more money to be spent on alternative energy research such as renewables—wind, wave and barrage power. No one of those can solve the problem. More research should be put into the development of solar power in Britain and in other places.
The decisions we are about to take have long-term and worldwide dimensions because the nuclear power industry is a pollutant. It cannot be anything but that. It is inherently a dangerous industry, as we have seen from the accidents at Chernobyl and Three Mile Island and other places and from the cancer deaths that have resulted from those accidents. Therefore, I hope that public opinion, which is increasingly and loudly expressed, concerning the safety of nuclear power stations and the nuclear power industry as a whole will be able to get some voice in the House.
Shortly after the publication of the Sizewell report, an article in The Independent of 28 January 1987 stated:

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"Half of Britain's voters believe an accident similar to the Chernobyl disaster could happen at a British nuclear reactor, according to a poll published yesterday."
British people are not happy about nuclear power or the nuclear power industry, despite the large sums of money spent by British Nuclear Fuels and the CEGB to convince them that nuclear power is cheap, clean and safe. They are not happy because they know that we do not have the technology to control nuclear power and to provide power safely. We must look to other forms of energy. That is why there must be an immediate increase in expenditure on energy conservation. Immediate expenditure on research into alternatives is important.
We have heard that France depends heavily on nuclear power— that is true— but, even there, expenditure per capita on energy conservation is considerably higher than in this country. The 1980 ratios in European economic units give reasonable comparative figures. Expenditure per capita on energy conservation was: Netherlands, 8·7; West Germany, 5·8; France, 3·5; and the United Kingdom, 0·9. This shows that other European countries are more concerned about the development of conservation measures than Britain.
The need for nuclear power to be developed in Third-world countries has been mentioned. It is true that poor, developing countries need increased energy resources, but I and many people in those countries are not convinced that importing technology from Western Europe or the United States and importing the uranium which goes with it will do anything other than cost those countries a great deal of foreign exchange in immediate development. They will not give them a real return on capital investment for a long time and indeed, might not be appropriate energy sources for those countries.
If western Europe and the United States are concerned about the provision of energy to meet needs in Third-world countries, they would be prepared to spend money on funding research into alternative energy sources rather than trying to foist high-technology nuclear power on those countries, which in many cases do not want it. It is a matter of our relationship with those countries rather than of our determination to shovel those systems on to those people.
A decision will be taken on the expenditure of at least £1·6 billion on the development of this Sizewell nuclear power station. Many people have expressed their fears about the safety of the nuclear industry. Accident records at Sellafield, Chernobyl, Three Mile Island and other places show the dangerous industry with which we are dealing. No amount of political lobbying and pressure will convince people of anything other than that they are dealing with a dangerous industry.
The arguments that we are provided with cheap electricity through nuclear power have been exploded— partly by the reduction in world prices and partly by the rather cock-eyed way in which price comparisons are made. The economic case put forward at Sizewell was one of the flimsiest parts of the inquiry. The authorities know perfectly well that the safety factors cannot be measured against the immediate cost of energy generation. In the more advanced coal-fired power stations which are being developed 2.46p per kilowatt hour is a reasonable figure to assume for the generation of electricity by coal. That is cheaper than for the proposed AGR. It is likely to be cheaper than for many other nuclear power stations which are planned. We must carefully consider those cases.
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The overriding case must be that Chernobyl happened 2,000 miles away and thousands of people throughout Europe will die of cancers as a result. A nuclear power station accident nearer home in France would kill many people in Britain. We do not have to step up the dangers of that accident by building another nuclear power station so near London. I hope that the popular understanding of the dangers of nuclear power and of the dangers as a result of the development of the nuclear power industry, and nuclear weapons industry which goes with it, will eventually force the Government, whoever they are, not to go ahead with the Sizewell nuclear power station.
It is curious that in Atom, the monthly magazine of the United Kingdom Atomic Energy Authority, there is a long article quoting the Secretary of State for Energy talking about the opportunity of the 1990s and how Britain's nuclear power industry will be a great success story. A small piece beside that article is headed "Sizewell motors ordered" and states:
"Sizewell B electric motor orders worth more than£4 million have been won by Laurence, Scott & Electromotors. The two contracts are Westinghouse in the USA and the Glasgow-based Weir Group."
The article briefly explains what those orders are. We know that the CEGB is already involved in considerable long lead ordering for the Sizewell nuclear power station, supposedly in advance of a decision by the Secretary of State. Does anyone really believe that the right hon. Gentleman has not already made up his mind that Sizewell will go ahead and that he is going to import this unproven American technology, which even the Americans are not prepared to have in their country, with all the dangers that go with it? We must say no to Sizewell and no to nuclear power and start looking for safer alternatives.
8.25 pm
Mr. John Hannam: This debate, although technically about the siting of just one nuclear reactor in Suffolk, is reaching out to cover the wider question of nuclear power and whether this country can or should turn its back on 25 years of nuclear electricity development.
Ever since I entered Parliament and became involved in energy matters, there has been a running battle between the coal lobby and the nuclear protagonists, so one would have expected that battle to continue today, although I have never seen the energy arena in that light. 1 have always held the view that both these resources were needed in a balanced energy programme with coal increasingly regarded as a valuable long-term industrial feedstock to replace oil when it runs out. To talk in terms of "either or"—either nuclear or coal—when there is 80 per cent. coal burn in our electricity generation is ridiculous.
The other strand of this debate is the choice of nuclear reactor, given that the decision is going to be made. Here again, as in other aspects of United Kingdom industrial scientific development, we seem to be good at the initial research but inclined to go adrift during the development period, often trying the wrong schemes and thereby losing the lead that we had at the start. During the 1970s we changed our choice of reactors three times and finished up with the AGR, which does not seem to be performing as well as it should.
I must therefore express some scepticism about the methods used in the past by nuclear officials to arrive at these crucial decisions. There has been far too much secrecy and not enough commercial input. However, since

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Layfield began the inquiry in 1983, a much healthier open debate has developed and, since the ghastly Chernobyl accident, the international nuclear scene has opened up to the advantage of us all. The problem is that nuclear power is such a highly technical subject that it is very difficult for the layman to sort out the detailed, often opposing, information coming at him from the two sides of the nuclear argument— whether it is nuclear versus coal, AGR versus PWR, or both coal and nuclear versus conservation and alternatives, as we have heard today. The argument goes on and people become ever more confused.
Sir Frank Layfield's inquiry has to be regarded, therefore, as a detailed and authoritative attempt to answer the key questions in the United Kingdom debate. The inquiry's findings are clear. The Sizewell B project is justified in terms of cost, safety and national need. Since its publication a few weeks ago, as was expected, a wave of criticism has emanated from opponents of nuclear power who feel that it is their duty to rubbish Layfield's findings. Their main criticisms relate to the price of world coal, the replacement of nuclear power by conservation and alternatives and the inherent safety of the PWR system. The latter two points I shall come on to, but we need to know the facts about coal prices before any decision is taken by the Government. I cannot believe that coal-fired electricity generation can be truly competitive with nuclear power unless we have access to massive supplies of cheap imported coal from the United States, Australia and, indeed, South Africa.
The coal lobby and the Opposition would not buy those options. In any case, we must think of what would happen to world coal prices if we became a major buyer on the open market—all this apart from the problems of acid rain and sulphur pollution. The coal price debate, based on the Cambridge Energy Research Group's report, shows that we would need to have a price of about $50 a tonne to produce a 5 per cent. return. In fact, the CEGB is paying $60 a tonne on current average prices. If we add on the $9 equivalent Government subsidy, the figures add up to the Layfield final decisions.
Some Opposition Members implied that, in some ways decommissioning costs are not included in the capital estimates for the nuclear stations. That is not so. Decommissioning costs are included in the capital estimates for nuclear stations. That point must be made absolutely clear.
This country has been extremely fortunate in having a variety of indigenous energy resources on its continental shelf. They have not been cheap resources, such as middle east oil or United States coal. We have had great difficulty in matching the energy costs of our competitors abroad.
In the world as a whole, the population has increased four times in a relatively short period, and industrialisation is speeding up throughout the developing world. In the foreseeable future, these two factors will place great strains of energy supplies, particularly on our traditional fossil fuels. I shall try to put that matter into some perspective.
This century is the first in the history of mankind when a world crippled by a shortage of energy has become a possibility, but the problems facing the 20th century are as nothing compared with the problems of the 21st century. Oil reserves in Europe are estimated to last about
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10 years, gas about 38 years, and coal, at economic prices, about 90 years. This is at a time when 35 per cent. of the Community's electricity is produced from nuclear energy. Without the nuclear component, Europe will have to increase its use of alternative fuels by the equivalent of about 3 million barrels of oil a day—far greater than the whole of the United Kingdom's production.
Europe is more dependent on fuel imports than are the United States, the Soviet Union or China. That dependency is increasing rapidly. Japan is in the same situation. It already has 25 per cent. of its electricity supplied by nuclear power. Within a decade, that will increase to 35 per cent. Ninety per cent. of the known reserves of coal are in China, the United States and Russia. Half the world's gas reserves are in Russia, and half of the oil reserves are in the middle east. Without nuclear energy in Europe, the cost of imports will rise by£35 billion a year simply to replace our own nuclear power.
In world global terms, the story is about the same. Oil is expected to run out in about the middle of the next century, gas a few years later, and coal between the years 2066 and 2076—although I would not put any money on betting that that is the exact period when that will happen. Uranium, in its cheap form, is in plentiful supply for years to come. The fast breeder reactor, which is already operating in some countries, will need very little uranium. Our existing stocks of depleted uranium in the United Kingdom would, in fast reactors, represent an energy potential equal to our total recoverable coal reserves.
The 21st century is when the known finite energy resources of the world are destined to run out. Population growth and accelerating industrialisation make the next century—not so far away now—the one in which energy supply will be the great challenge; and with the Third-world demand for electricity energy creating huge increases in imports of energy, the vital need will be for cheap energy. The estimates are that, by the year 2030, 15 to 20 per cent. of the world's energy needs will have to be met by nuclear power. Without it, we will need to discover the equivalent of the North sea oilfields every two years or, in coal, a huge new Colombian coalfield every six months.
Faced with these forecasts and with the Chernobyl accident spreading a degree of fear of the unknown, we understandably have to look at all the alternative forms of energy that we might harness. Japan, nearly totally dependent on imported energy, has poured countless millions of pounds into research and development of alternative forms of energy. Yet the most promising sources of renewable energy supplies— solar, hydro, tidal, wind, waves and geothermal— might, in combination, contribute a proportion of increased electricity demand but could not hope to replace the 20 per cent. of existing demand now met by nuclear power.
We must look at the other alternative— energy efficiency. I totally agree with the remarks made by my hon. Friend the Member for Carshalton and Wallington (Mr. Forman) that we can contribute towards filling a large part of the gap with energy savings. We are obviously working in all directions, but we are still lagging behind the increased growth in demand. We could reduce our demand to about 20 per cent. below what it might have been over a period of years, but it is still an uphill struggle. Over the past 35 years, we have improved energy efficiency by 35 per cent., but demand for all energy increased by 37

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per cent. So we come back to the energy resource to which the world is turning as the only viable source of energy for the future—nuclear power.
Huge investments of £10 billion a year are taking place in nuclear power stations; by the year 2050, the market for nuclear fuel services will be worth £25 billion a year, and capital investment in power stations will average £20 billion a year. Britain has the skills and expertise to share in that expanding nuclear market, and many thousands of jobs will be at stake if we opt out.
The world will continue with nuclear energy now that the true facts of the Chernobyl accident are known. France derives 65 per cent. of its electricity from nuclear power, Belgium 63 per cent., Finland 38 per cent., West Germany 31 per cent. and rising, Hungary 24 per cent., Spain 24 per cent., and Sweden 40 per cent. The United States has 25 stations under construction and 95 operating. Russia is doubling its capacity in five years. China is embarking on a major programme. All this has to be accepted as evidence of the world's inescapable belief in the future of nuclear power as a safe and plentiful source of energy for the 21st century.
The United Kingdom has had nuclear power for 25 years, building up without deaths or any serious accidents to the point at which about 20 per cent. of our electricity requirement is met by nuclear generation and, with the stations to be commissioned in the near future, it will rise to about 25 per cent. Our safety standards, operated by the Health and Safety Executive's nuclear installations inspectorate, are the highest in the world, as borne out by Sir Frank Layfield's report. Having carried out the most exhaustive inquiry ever, he has concluded unequivocably that there is a national interest in building a PWR, that the national interest can best be met by building a station at Sizewell in Suffolk, and that the economic benefits outweigh the risks that are likely to be incurred.
Layfield found that there is only a one in 40 chance of coal being more economic than a PWR, and that there is only a one in four chance of an AGR being more economic.
These findings are all based on a one-off PWR, which will cost £200 million more than any successor of the same design. So, if we are to believe the expert's report, the PWR can be built safely and economically, as it has been and is being built in France, Germany, Japan and other countries. Therefore, do we really need any of these reactors? Do we have enough capacity already? Those are the questions to which we finally come.
Just a few weeks ago, the increase in average demand for electricity reached a peak during the cold weather, and on 12 January demand reached an all-time record of 48,300 MW. Even with imported electricity from France, which we brought in as fast as we could, the CEGB had to shed load with a 3 per cent. voltage reduction. This was followed by two cuts of supplies to industrial customers, and for the first time since the 1960s we were at risk of electricity blackouts in England and Wales.
New power stations take seven to 10 years to build, and with a 1 to 1·5 per cent. increase in demand per year, plus the phasing out of the old Magnox stations, about 10 new stations the size of Sizewell will be needed by the year 2000. That is why plans are ready not only for nuclear stations but for several coal-fired stations to come into operation by the mid-1990s.
The objective for this country, therefore, is not to have the massive French-style nuclear programme— that is
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necessary because they do not possess other fossil fuels as we do— but to maintain a base load supply of cheap electricity at 25 per cent. nuclear content, to continue to bring our coal prices down through greater productivity in the pits, to develop the alternatives as fast as they become viable and to conserve energy with every effort that we can make. We might then scrape through until the mid-21st century when the next generation of fast reactors will be removing the problems of plutonium waste.
For the other parties to choose the path of what they think is electoral advantage and to "phase out" or fail to expand or replace our 25 per cent. nuclear content is, in my view, an act of reprehensible folly. Our industries would decline as continental energy savings defeated them, our electricity costs would rise sharply, and ultimately the integrity of our supply system would break down. Nuclear power has its challenges and dangers, like most other major industrial processes, but we know that we can meet those challenges; and I trust that in the coming weeks we can carry the country with us on this crucial issue.
8.40 pm
Mr. Tam Dalyell: Some, although, I am bound to say, not as many as this generous House normally accords to authors of reports, polite tributes have been paid to Sir Frank Layfield and his colleagues. I fear that I am a bad fairy in this debate. 1 believe that it was an expensive fiasco, coming up with wrong, indecisive, late and ill-supported conclusions, many of which have been overtaken by events.
How many Members of Parliament actually went to the Makings at Snape to see and hear what was going on? I did for half a day. It was one of the most bizarre spectacles that I have encountered. Here were these lawyers going on and on, on a stage which really belonged to the late Peter Pears and the late Benjamin Britten. I thought of happier times in that hall.
I ask this question. Should it ever have been a matter for that sort of lawyers' paradise? Here we had distinguished QCs mugging up their technical brief— how long they will remember it I know not— and questioning various witnesses, in the catch-out way that lawyers do.
The terms of reference were deeply muddled and flawed. Part of it was about whether there should be a power station on the Suffolk coast and part of it was about the future of reactor choice. Those two subjects should never ever have been entangled.
I ask my first question of Ministers. What was the cost of all that? I am told that it is not much less than £25 million. The Secretary of State must know. Can he confirm or deny it? He remains silent. I think that the £25 million is correct.
I would listen willingly to Sir Frank Layfield on local income tax, but why should we listen to him particularly on reactor choice? Is a lawyers' bonanza the way in which to settle those matters— clever lawyers rather than a sensible engineering decision from the point of view of the country? Truth in the interests of the country will be achieved not by legal one-upmanship, but by a group of scientists and engineers with a leavering of laymen. That is why 1 was so sympathetic to the hon. Member for Carshalton and Wallington (Mr. Forman). It should have been some sort of Royal Commission.

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I am deeply critical because the set-up of the inquiry took on a life of its own. Doubtless it was agreeable for a lot of well-paid people to go up and down to Suffolk.
It is dangerous to be frivolous about it, but one might well ask how many trees were cut down in providing the sheer amount of bumf that sourrounded the Sizewell inquiry and how many man hours were spent by busy people giving evidence, who surely could have been better employed.
Will this country ever again enter into such an inquiry? I hope to heaven that we shall not.
Nor am I greatly impressed by the consultation that is being apparently accorded to the House of Commons. This is in danger of being a polite farce. If the Secretary of State had been serious about giving consideration to the views of the Commons, he would certainly have given the projections that exist in his Department. I suspect that the House of Commons is paid as much attention as an entity as a rubber stamp on his desk. During the speeches by the Secretary of State's hon. Friends and mine, I have not seen him take a single note. I may do him an injustice—
Mr. Peter Walker: Yes.
Mr. Dalyell: If I do, the right hon. Gentleman might like to intervene.
Mr. Peter Walker: The notes that Hansard reporters take are more accurate than mine.
Mr. Dalyell: All right. I am glad that the right hon. Gentleman will take serious notice of what is said.
I interrupted the Secretary of State's opening speech to ask whether the lowest oil and coal prices that the Layfield committee assumed were likely in 1990 until 2000 were higher than those which his Department thinks likely, given the recent fall in oil prices. That is a central question. The figure should have been given to the House, because the updated view of the Department on what is likely to happen in 1990 until 2000 is a matter of considerable importance in the debate.
I wish that this country had decided to take the advanced gas-cooled reactor road. The performance of the South of Scotland Electricity Board's AGR power station at Hunterston over the past three years has been outstanding. Along with colleagues, I have visited Hunterston. I have also scrambled over Torness. The Hunterston B performance over that period has proved that the AGR design has now reached maturity.
The standard measure of a power station's ability to produce power is expressed as a percentage of the full output load factor. In the past three years the Hunterston B reactors have continued to operate at consistently high levels. In the year ending 1984, the declared gross output per unit was 562 MW. In 1985 it was 598 MW and in 1986 it was 623 MW. The load factor as a percentage in unit 1 at Hunterston in 1984 was 891 and in unit 2 it was 69·9. There were planned outages for statutory inspections in those years. In 1985 the load factor was 73·8 per cent. for unit 1 and 91·1 per cent. for unit 2. In 1986 it was 91·5 per cent. for unit 1 and 72·6 per cent. for unit 2, including the outages. The average was 84·9 per cent. for unit 1 and 78 per cent. for unit 2.
I come back to the road of the AGR, which was dismissed. Although the unit rated output capacity is
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below the design figure of 660 MW, the output per channel in the reactor is greater even than at Torness. My earlier figures are therefore more representative of the expected performance for later AGRs to this design than load factors based on the original design output.
Performance figures for the Western world's nuclear power stations are published in the journal Nucleonics Week, and they are expressed in terms of the gross design output. Even on that basis, the Hunterston B reactors are performing well as detailed—the 1984 output was 71·2 per cent.; in 1985 it was 77 per cent. and in 1986 it was 77·4 per cent. The consistently good performance of the Hunterston B type AGRs together with the construction experience at Torness where the first reactor was completed to the planned six year programme— and work on the second is well advanced—show that these reactors have now reached maturity. That reinforces the South of Scotland Electricity Board's confidence in that design.
The load factor as a comparison for the large American PWRs has been about 55 per cent. over the past three years. The load factor on the two pressurised water reactors of the design similar to that proposed at Sizewell B at Callaway and Wolf Creek was about 70 per cent. last year. The AGR has many advantages over the PWR.
I want to consider the details of the Sizewell inquiry. Paragraph 88.4 of the report states:
"Those figures are subject to considerable uncertainty. Taking that uncertainty into account, I"—
that is, Sir Frank Layfield—
"concluded that Sizewell B was likely to provide lower cost generating capacity than an AGR. There was a probability that the AGR would have lower costs: my broad judgement was that this probability was about one in five."
That is a matter of opinion. Is a lawyer's broad judgement to be absolutely paramount in these matters?
In paragraph 88.7 Sir Frank Layfield states:
"I did not regard the limited experience as justifying the economic appraisal of the AGR on target time and cost estimates which the SSEB suggested should be adopted."
We in Scotland are entitled to ask, "Why not?" The figures for improvements in AGR construction and performance are of recent origin and are necessarily based on a small number of stations. Layfield admits that it was too early to be sufficiently sure that the improvements would be maintained for all of them to be adopted when assessing the figure for central estimates. Four years have passed and the record is known and it is a good record.
Paragraph 88.8 of the report claims:
"Nonetheless the evidence revealed that the construction of new AGRs was running to programme and budget, that the performance of existing AGRs had improved markedly, and that the results of research into plant performance encouraged the belief that further improvements in performance were likely."
Progress has been m ade on AGR performance. These improvements have taken place. Paragraph 88.8 continues:
"Progress in AGR performance should be kept under close review."
Is the Department of Energy keeping it under review? That observation was three or four years old. Anyone who considers the review and the figures that I have given must be impressed.
Paragraph 88.8 continues:

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"Should that progress be maintained for a few years (after 1984) there may be a firm basis for allowing those improvements to figure in the economic appraisal of a new AGR and in reviewing its comparative ranking."
Is that being done? Paragraph 88.10 states:
"Since the time of the Thermal Reactor Assessment in 1977, it has been argued that because of the large numbers of PWRs operating outside the UK there was a risk that accidents abroad might necessitate design changes or shutdowns of PWRs in the UK. The same risk does not apply to the AGR. The Nil thought there was only a small chance of a serious PWR accident abroad leading to important design changes in possible UK PWRs. But it agreed that accidents overseas would not affect the AGR except when they had features common to both reactor types."
The AGR wins on that safety score.
Paragraph 88.13 states:
"It should be noted that the economic comparisons between small programmes of AGRs and PWRs were made for illustrative purposes only; no firm conclusions can be drawn from them."
When we consider the small print, the picture rather alters to coming down firmly on the side of Walter Marshall's prejudice for the PWR. Paragraph 88.16 states:
"The Board wished to retain an AGR design and engineering capability until at least 1990, by when it would be clearer whether the CEGB or the SSEB was likely to place a further order for an AGR."
Are we or are we not keeping the AGR in being?
Paragraph 2.163 of the report states:
"If the performance of the AGR since the Inquiry has continued to improve, it may well merit a reappraisal of reactor system choice when the figures are sufficiently reliable."
Is there to be such a reappraisal? This debate is very difficult because on questions of judgment I can understand that Ministers do not want to reply. I complain that Ministers are absolutely mute on questions of fact about what is happening in their Departments. That does not help the House or the country and I believe that that is an extraordinary attitude.
Paragraph 2.164 states:
"The evidence did not enable me to determine what effect consent for Sizewell B would have on the UK's ability to build further AGRs. I agree with the Select Committee's comments that there are problems in keeping open two different types of reactor for the UK. Proceeding with Sizewell B would, in my opinion, impair the UK's AGR capability."
Sir Frank Layfield can say that again. Is it not possible to go ahead with two reactor types? Is that option open? It is either open or closed, yet again the Secretary of State is silent. That is not helpful to the general argument. Layfield continues in paragraph 2.164:
"Doubtless the Secretary of State will wish to weigh the AGR's future when considering the CEGB's application"
What is the future of the AGR? We are not getting much further in this debate in ascertaining that important technological fact.
I am a Scottish Member of Parliament, the first to speak today from the Opposition Benches. Scotland is proportionately one of the world's leading users of nuclear energy. Currently about 45 per cent. of the electricity consumed north of the border comes from nuclear sources and when the new power station at Torness is fully commissioned, the proportion will reach about 60 per cent. The success of the Magnox and AGR reactors at Hunterston has enabled Scotland to keep electricity prices among the lowest in Britain. It follows that the SSEB has a heavy commitment to the continued success of nuclear power in the United Kingdom. That is the view of a great many of my constituents who are concerned about jobs.
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After their early teething troubles, the Hinkley Point B and Hunterston B AGRs have operated extremely well. The Heysham and Torness AGR stations based on the Hinkley-Hunterston design began construction in 1980 and are nearing completion. They have confirmed that AGRs can be built to programme and close to budget.
Mr. Michael Morris: The hon. Gentleman says that Scotland will have 60 per cent. low-cost nuclear power, yet all afternoon he has been questioning my right hon. Friend the Secretary of State, saying that the lower price of coal undermines the basis of the Layfield report.
Mr. Dalyell: I have just been asking for the facts. We should argue this on the basis of current knowledge, not knowledge that is three or four years old. The hon. Gentleman is a member of the Public Accounts Committee. As a previous member, I know that there are genuine difficulties in relying on figures that are out of date. Sometimes that has to be done in the work of the PAC and other committees. What is so absurd is that there are projections in the Department, yet the House of Commons is served up with facts that are known to be out of date. Although we may sometimes have to deal with out-of-date facts, why serve them up when more recent ones are available?
Then we come to Dungeness B, Hartlepool, and Heysham. The AGRs are in the early operational phase and teething troubles are being overcome. They are providing useful supporting information. However, assessment of future AGR projects must be concentrated on the successful reactors at Hinkley, Hunterston, Heysham II and Torness. The construction of Heysham II and Torness has proceeded to programme. They are nearing completion, and the main commissioning tests have been commenced at both sites. The experience is there. Why waste it?
In the United States, no PWR station has commenced construction since the Three Mile Island incident; I agree with Zabrowski Rasmussen and others that it was an incident, not an accident. The Sizewell B inquiry sat for 340 days hearing evidence on a PWR proposal. One of my main complaints about the way in which the Layfield committee went about its work was that relatively little attention was paid to the AGR, although the CEGB statement of case concluded that the PWR offered lower electricity costs to the consumer.
The case for the AGR was never properly heard by the Layfield committee.
The inspector asked the SSEB, as the only other operator of AGRs, to give evidence. The SSEB, which was not otherwise a party to the inquiry, concluded that, in the light of current experience, the CEGB's assumptions about a future AGR were unduly pessimistic, and it deduced that the PWR did not offer any identifiable economic advantage and in practice could increase electricity charges.
It is now envisaged that no more than 7,000 MW of new nuclear capacity will be required before the end of the century. In those circumstances, it would not make industrial or economic sense to maintain a capability for building two reactor types. The CEGB effectively acknowledged the latter point towards the end of the Sizewell inquiry by stating its wish to build a family of four or five PWRs. The South of Scotland Electricity Board believes that there is no need to build a PWR in the United

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Kingdom to establish the option, and it is clear that if Sizewell PWR is built the AGR infrastructure will decay and the AGR option will be foreclosed.
Do Ministers accept that if they go ahead with the PWR, the AGR option will be foreclosed? The Department must have made a judgment on this. It must at least know what it thinks about the matter. It is unrealistic to suggest that, with a PWR at Sizewell, the United Kingdom will have the choice thereafter of building an AGR or a PWR, whichever appears to be preferable.
Now we come to construction times. With the construction of the first Torness unit more than 90 per cent. complete, all the key dates have so far been met on target or earlier, and the original date for starting the main commissioning tests has been advanced by three months. Heysham II is also on programme. Can the same be said of Sizewell? As my hon. Friend the Member for Stockton, North (Mr. Cook) said in a most important speech, we are building a foreign reactor. The idea that we could build a foreign reactor as well as the most experienced American builder—hat his experience would be some years old—is moonshine.
Do hon. Members remember the Spey engine and the problems of putting British engines into American aircraft? There are technological difficulties.
Any suggestion that the AGR is inherently difficult to build is dispelled by experience now available. With major advances in factory fabrication and assembly, the proportions of factory and site work for AGR and PWR plant are at best similar. The advantage may be with the AGR. The present AGR design is well adapted to construction on site. It provides good access and allows manpower to be widely dispersed over many workplaces. The SSEB programme for a future AGR station of 75 months from start of main construction to full load on the first of its two units—the Torness baseliner programme— therefore includes some margin, especially with the scope for streamlining erection techniques further.
What a pity it is not to go ahead, after all the agonies that we have had with the AGR, and to throw British expertise to the winds and suddenly go American. That would be unpatriotic and technological nonsense.
We come next to safety, a point that was importantly put by my hon. Friend the Member for Stockton, North. All types of reactor have to be shown to meet the same numerical safety standards to the satisfaction of the licensing authority. Standards in the United Kingdom are comparable with the most stringent applied anywhere in the world.
The AGR, however, has certain inherent features which reduce its dependence on engineered safeguards. The combination of a single-phase coolant, a large thermal capacity and a relatively low fuel rating makes the shutdown reactor change temperature relatively slowly even should there be a failure of the engineered safety provisions.
I see my hon. Friend the Member for Stockton, North nodding in agreement. He knows from his engineering experience that this is a very important point as it allows the operators several hours for well considered remedial action as compared with the possibility of a matter of minutes available to the operator of a water-cooled reactor in similar circumstances.
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I also was a close friend of the late Ned Franklin. We owe it to his memory and to the opinion of others to accept that one of the great advantages of AGRs in a crisis is that at least there is time, which was in scarce supply at Three Mile Island. Time is of the essence when dealing with a crunch reactor crisis.
The NII said at the Sizewell inquiry that it would wish to review three aspects of the AGR for any future project. The first—the gas baffle—has since been reassessed in the industry and been confirmed to be of high integrity.
The second, conformity with updated seismic design criteria, can be achieved, and initial assessment suggests that there would not be significant cost implications.
The third, the risk from aircraft impact, is not expected to impose any greater siting restriction on this account than for any other reactor types which might be built in the United Kingdom. The safety argument comes down in favour of the AGR.
As for public acceptability, gas-cooled reactors have achieved significant acceptability; PWRs have not. In 1968, the Minister of Power made a statement to the effect that either Magnox or AGR stations in pre-stressed concrete pressure vessels could be constructed much nearer urban areas than had previously been permitted. Hartlepool and Heysham are examples of semi-urban sites. That policy was reaffirmed by the decision to build Heysham II in 1980 and by the Nil in its evidence to the Sizewell inquiry.
Siting flexibility is an important issue, in densely populated or, by public reaction, not so densely populated areas. A further constraint on siting is the large quantity of cooling water which is required. Due to the higher thermal efficiency of AGRs as opposed to PWRs, some 40 per cent. more capacity can be stored for a given heat release to the environment.
Does the Department in any way dispute these judgments? If so, it will have to say so, and soon. If not 'in the winding-up speech, these questions will have to be answered at least by Ministerial letter as there are many people in Scotland and elsewhere, besides me, who want to know the answers.
I shall now turn to the issue of the impact on industry. The effect which the choice of future reactor will have on British industry is important and three aspects have to be considered. First, there is the impact on the manufacturing sector, secondly the impact on the design and construction sector and thirdly, the impact on the electricity supply industry. The Heysham II and Torness design is repeatable for further AGRs using an industrial infrastructure consisting of existing factory buildings, plant, designs, technical services and training in which the United Kingdom has already invested £250 million.
Industry has the resources and proven capability to build AGRs to budget and programme. Replication of this design standard must lead to further economies in manufacture and construction. It would make one weep if all this British investment were to be thrown to the winds for an American reactor. Make no mistake about it, if we go ahead with the PWR we shall become yet again, as in helicopters and elsewhere, America-dependent. For a country with our record in the development of nuclear power that would be a terrible, crying shame.
With the PWR there is at present no committed plan to create in Britain the infrastructure for manufacturing the reactor pressure vessel and some other specialised

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reactor components. To establish this with a predictable demand must be very questionable while there is massive over-capacity in other industrial countries.
The foreign exchange element of the Sizewell B PWR design royalties and imports—let us not forget royalties—is expected to amount to about 10 per cent. of the station cost. That 10 per cent. would not affect an AGR. The imports include, and could well continue to include, the most advanced elements of design, engineering analysis and production which will tend to stay to advantage at the high technology end of the British nuclear manufacturing and construction industry.
We must also consider the all-important matter of job creation. The difference in capital cost between the AGR and the PWR implies that a programme of AGRs would create marginally more jobs in the United Kingdom engineering and construction industries than a programme of PWRs—even if no component or service were imported and no royalty had to be paid for the PWR. However, since royalties will have to be paid and components will have to be imported, the advantage of the AGR is overwhelming and the distribution of jobs among firms could differ.
Apart from raw graphite material for the reactor core, the AGR is almost entirely British designed and manufactured. Its total import content is about 10 per cent. The kind of briefings that we have had in the past from impartial shop stewards as well as briefings that my hon. Friends the Members for Stockton, North and Wentworth (Mr. Hardy) have had from manufacturing industry, show that there is an overwhelming case for the AGR.
The choice of a future reactor type is a major national decision. At best, the PWR could do little more than break even in economic terms with the AGR. The reality is more likely to be additional costs and uncertainty, and those difficulties will be faced if the industry is made to carry another British prototype through its learning stage. A decision to discontinue the AGR invites identifiable penalties—
Mr. John Powley: On a point of order, Mr. Deputy Speaker. At the start of this debate Mr. Speaker told the House that a large number of hon. Members had said that they wished to speak in it. I was one such hon. Member. Mr. Speaker said that he would be grateful if hon. Members kept their speeches to a modest length. The hon. Member for Linlithgow (Mr. Dalyell) has been speaking for 33 minutes. Would you care to say that other hon. Members wish to contribute to the debate?
Mr. Deputy Speaker Mr. Ernest Armstrong): Some hon. Members have been here for most of the debate and I regret that they will not have an opportunity to speak.
Mr. Dalyell rose—
Mr. Deputy Speaker: Order. I have no jurisdiction over the length of speeches.
Mr. Dalyell: I understood that the Whips' agreement with this side of the House was 9.15 pm.
The operation at Hinkley Point B and Hunterston B and design and construction experience at Heysham II and Torness give confidence that the massive effort put into resolving detailed problems has taken the AGR to maturity. There is opportunity to benefit from this. The
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design of the AGR now established provides a basis for replication and detailed refinement. Worldwide experience suggests that success stems from a continuing commitment to a well founded, proven design.
I end—at 9.15 pm—with the plea that before it is too late, at the 11th hour and 59th minute, this country goes back to its proven technology that we have developed with our brains and that at this stage does not go American simply because of the prejudices of those at the top of the CEGB. The South of Scotland Electricity Board has been right all along and the CEGB has been wrong. The Scots are just as good engineers and scientists as anyone else south of the border.
9.15 pm
Mr. Peter Rost: As a member of the Energy Select Committee I have had the opportunity of seeing PWR reactors in America, Japan, Germany, France, Spain and elsewhere. Everywhere they have worked effectively, they have been a cost benefit to the economy, and on the whole they have been built to time and cost. I am satisfied, as was Sir Frank Layfield, that if we are to build a PWR in this country we could and would do so safely.
However, there are doubts, which to my mind have not been satisfied by the Layfield report, about whether we could build PWRs according to the cost estimates presented in the report. There is not much in the record of our nuclear industry—unfortunately a record of indecision, muddle, cost overruns and delays—to suggest, except to the most optimistic person, that we could build PWRs that would result in the cost benefits that are claimed for them. Therefore, there must be an element of doubt and scepticism about the advantages of PWRs.
I hope that those doubts can be resolved. Nevertheless, it is right for the House to express them. Conservative colleagues in particular, like myself, have been waiting all day to contribute to the debate. Unfortunately. it is unlikely that they will be able to contribute. But they have a view which fundamentally disagrees with the view just expressed by the hon. Member for Linlithgow (Mr. Dalyell). I think in particular of my hon. Friends the Members for Norwich, North (Mr. Thompson), for Norwich, South (Mr. Powley) and for Northampton, South (Mr. Morris). I shall not attempt to make their points for them, but I very much agree that, although the AGR is a British system, and although we have built it. it has not proved the economic merits of nuclear power nor has it exactly been an export success. I certainly have not seen any abroad.
We must accept that if we are to have more nuclear power—and I believe that we should—we must devise a system that can achieve that objective. There are 400 PWRs working in the rest of the world. That is the way that technology has gone. If we are satisfied on safety grounds and that we can do so economically, we should go ahead.
I believe that the pro-nuclear lobby, among which I include myself, would make more impact on the public debate about nuclear power if it did not try to discredit all the alternatives. To some extent that is my main criticism of the Layfield report. I have doubts about the economic viability of the PWR, which, hopefully, we may overcome, but I also have doubts about the way in which the alternative options were discussed in the report. There

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were one or two serious weaknesses in it. I agree that greater investment in energy efficiency would be highly cost-effective and would, to some extent, reduce the demand for extra electricity. However, I accept that most of the savings that would result from energy efficiency would be taken up in higher living standards and not in reduced energy consumption. Therefore, I do not accept the arguments put by some hon. Members that we can avoid building more nuclear power stations simply by investing in greater energy efficiency.
All the evidence is that people have a dissatisfied demand for greater energy, especially more warmth and heat, and would use greater installation standards by enjoying a higher living standard rather than using less energy. I also agree with the Layfield report that most of the renewables, with the exception of tidal power, cannot make more than a modest and long-term contribution to replacing nuclear power.
The Severn tidal power scheme could produce the equivalent of two or three Sizewells and probably at lower cost per unit of electricity, but unfortuntely not within the time scale within which we may require extra power.
The Layfield report was weakest in its comments on the only viable alternative to nuclear power that it seriously considered but rejected on the grounds that it could not make a big enough contribution in time. That was the alternative of using our power stations for heat and electricity production combined and producing more of our electricity from within industry. Sir Frank Layfield assumed that, because most of our electricity today comes from within the nationalised industry monopoly, or effective monopoly, it will always be so. Chapter 53.12 states:
"In the UK about 7 per cent. of electricity in 1983 was privately generated."
The assumption is that, because only 7 per cent. of electricity is privately generated in the United Kingdom, that is more or less the only contribution that the private sector can make. Yet, if we look abroad, we see that the private sector electricity industry is where the greatest growth is taking place. In America one of the main reasons why nuclear power stations are not being ordered is because the utilities in America have worked out that it is cheaper to buy in the extra electricity from industry, in other words by co-generation, rather than by building new power stations themselves. That is where the biggest growth in electricity capacity is taking place. There is already the equivalent of 40,000 MW of co-generated electricity in the United States. That is the equivalent of more than 30 Sizewells.
What Layfield has not taken into account is that, if the economic circumstances were even-handed in this country, there would be more private generation of electricity. Since he made his assumption the Energy Act 1976 has changed the rules and has improved the economics for private generation of electricity. Indeed, that is now taking off. Many projects are going ahead within industry which process heat and produce electricity for export. The economics of that are far more robust than the electricity-only power stations proposed by the CEGB. The report should have assessed that as an alternative, as it should have assessed the alternative of large-scale city district heating combined with electricity production as an additional source of electricity capacity.
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The report dealt with that at great length in chapter 58, but came to the conclusion that district combined heat and power would not develop fast enough to meet the needs for extra capacity.
The report completely fails to address itself to why combined heat and power and city district heating are not likely to expand fast enough in the United Kingdom to meet the demand. In Europe 3,000 cities have combined heat and electricity production and the systems are expanding fast. It is not expanding fast here simply because the ground rules are not even-handed. The Government expect city consortia, such as Sheffield, Leicester, Corby, Newcastle and Edinburgh, to get on with district heating combined with electricity production and to raise the money in the private sector at commercial rates of return without the support of the electricity industry. Yet they say to the electricity industry, "You can build nuclear power stations at a discount rate of 5 per cent." In other words, if the Sizewell project goes ahead, it will be subsidised by public money because a 5 per cent. real rate of return is not a commercial market rate. As the Layfield report acknowledged, the main potential alternative cannot go ahead because it must raise its money in the market place at a commercial rate of return which is higher than that at which the electricity industry can invest.
Mr. Barron: Would the hon. Gentleman care to say what the real rate of return should be if 5 per cent. is not big enough?
Mr. Rost: The real rate of return should be the market rate of return.
The only way in which the problem can be resolved and we can assess whether there is an alternative to more nuclear power which is viable and, perhaps, has a better rate of return is to put it to the test of the market. Why is it that when we want a Channel tunnel the Government say, "Yes, let us have it, providing it is a good economic proposition. That can be proved only if investors are prepared to put up the money."? Why is it that when we say we want the Severn barrage the Government say, "Fine, providing private investors are prepared to put up the money."? Why does the whole private sector say that in this case, but the Government say, "No, we can have Sizewell and nobody needs prove whether it is commercial."?
The only way to prove whether Sizewell B is a commercial proposition is to put it to the test of the market place in the same way that the Government expect the alternative to Sizewell to be tested by the market place. We should have a privately led investment in Sizewell and a commercial return should be demanded, not a 5 per cent. discount rate. Then we would probably get not only Sizewell and more nuclear power, but other alternative investments—perhaps the Severn barrage and certainly city district heating in many cities—which would produce a higher rate of return and increase the capacity of our electricity production.
Only if we put energy production of new capacity to the market test, as private utilities must do to assess which is the most cost-effective, will we gain savings in the PSBR and test whether we are putting our nation's resources to the best advantage.
That must be the test for Sizewell. I hope that, if that test were applied, the project would go ahead, as would viable alternatives.
9.30 pm
Dr. David Clark: This debate is unique in the sense that it is the first time that I have taken part when the Secretary of State has been banned by his quasi-judicial responsibilities from addressing us. We understand that. However, it is a pity that we have not been able to draw out the facts of the case as opposed to the judgment. We accept the difficulty for the Secretary of State, but hope that he might reply by letter to some of the factual points put from both sides of the House.
The Secretary of State says that his main role is that of a Trappist. He says that he has to sit and listen. In that spirit we think that it might be useful to give him a further indication of our views by dividing the House so that he has a feel of how the House feels. We shall divide, since that is the only way to register our opposition to the proposed PWR construction at Sizewell, in line with early-day motion 636.
We have had a long debate. That is right because we have discussed a long report produced as a result of a lengthy inquiry. The report might be long, but it is lucid, as hon. Members on both sides have said. Sir Frank Layfield has the facility to translate complicated and technical issues into words which the layman can follow.
The report has about 3,000 pages. I fear that it will have a similar fate to "Das Kapital"—many people will quote from it, but few will read it. That is a pity, because the report is in depth, thorough and well written.
I say that it is a pity for a more fundamental reason. It is a pity because, if one reads the report carefully, one sees that the main conclusions by Sir Frank are not substantiated by the detailed analysis in the report. That has been said by several hon. Members. The tone and tenor of the detailed arguments in the text are often at variance with the general conclusions, as I shall attempt to show.
First, I shall deal with another fundamental shortcoming of the report, for which Sir Frank is blameless. I refer to the way in which he was precluded by statute from referring to any events following the closure of the public inquiry on 7 March. Almost every hon. Member taking part in today's debate has recognised that there has been an event of considerable magnitude affecting our nuclear debate—the Chernobyl accident. That tragic accident in the Soviet Union has reshaped the whole nuclear debate. Sir Frank Layfield was prohibited from discussing that accident, but it is the duty of the House to try to interpret his report in the light of the Chenobyl experience. That is our responsibility.
To ask Sir Frank Layfield to write his report on nuclear power generation without reference to Chernobyl is like commissioning a war historian to write the history of the second world war without any reference to the events following the Normandy landing. It is as simple as that.
The effects of Chernobyl have been truly traumatic. Following it, how many people can seriously accept Layfield's bland assertion:
"An accident at Sizewell B, if built, would almost certainly have tolerable consequences, at worst requiring measures such as the banning of milk near the station. Theoretically possible accidents which could cause hundreds of thousands of deaths would almost certainly not occur."
Sir Trevor Skeet: We are dealing with entirely different reactor systems. One contains a design fault that is extremely serious, but it is most important to state that that fault is not found in the United Kingdom reactors.
Dr. Clark: I expected the hon. Gentleman to anticipate my next point. I accept that there is a difference in technology between the Chernobyl reactor and the PWR. I will not call in aid the Three Mile Island incident that involved a PWR system. Has the hon. Gentleman not heard of the debate that is currently raging in the nuclear sector relating to fuel clad ballooning? That is what can happen to the Zircaloy casing surrounding the PWR's fuel elements in an accident in which the cooling water that flows through the core of the reactor is lost. In such an accident the high temperature and stress can cause the cladding to distend and deform. The result is that the cooling system is affected. Released super-heated steam combines with the Zircaloy and produces hydrogen. That is exactly what happened at Chernobyl and that is what blew the top off that reactor. It could also happen to a PWR.
I also wish to remind the hon. Gentleman of the dangerous concept associated with PWR—the China syndrome. That syndrome cannot occur in a heavy water reactor, but it can take place within a PWR. That is what terrifies so many nuclear experts.
Everything is not as simple as Conservative Members would have us believe because every nuclear station has its own design weaknesses. Nuclear scientists recognise that, and the purpose of spending so much time on the design and its safety is to minimise the design weaknesses of the reactor. Conservative Members have tried to minimise the risk, and that is a disservice to the House and the nation.
My fears about safety are supported by such eminent groups as the Nuclear Electricity Information Group—not an anti-nuclear group— that recently issued an information document in which it said:
"Could there be a major accident in a British nuclear power station? The answer must be `yes'."
Those are not my words. I ask the House not to minimise the danger of a nuclear accident in a power station.
The effects of Chernobyl were serious, and they are still with us. The accident affected, not only the Soviet Union and the immediate neighbouring states, but every country in the northern hemisphere. It will continue to affect people for many generations to come. The United Kingdom was not immune from the effects. One school of thought believes that too little information has been released to the public concerning the effects of Chernobyl on the United Kingdom.
In the period immediately before the Chernobyl accident, March 1986, the National Radiological Protection Board published a new recommended upper limit for exposure of the public to artificial radiation. It recommended a level of 1 mSv per year. The existing legal limit is 5 mSv. However, the new level of 1 mSv is still much greater than the level in the United States of 0·25 mSv, or West Germany where the level is 0·3 mSv.
It is estimated that the average dose in Britain for the first year, post Chernobyl, is 0·07 mSv. If that is correct. it is not too worrying. However, in the northern region of the United Kingdom—the: north, the north-west, Scotland, Yorkshire and Northern Ireland— the radiation exposure level for more than 250,000 children under the age of five was close to the 1 mSv level. Such was the danger for the British people, and we must accept that they were in that position.
As I have said, the effects will be felt for years to come. The director of the National Radiological Protection Board said that about 45 people might die of cancer over

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the next 50 years in the United Kingdom as a result of Chernobyl, and that is widely regarded as a most conservative estimate.
I do not want to go on about Chernobyl, as I think that the point has been taken, but it is a landmark in the history of the nuclear debate. It is worth reminding ourselves that not only human beings are affected. As in so many other instances, we can obtain the first warning signs from animals. It is remarkable that even now, almost 12 months after Chernobyl, the levels of radioactivity in sheep and in grass in some of the infected areas of Cumberland are as high now as they were immediately post-Chernobyl.
The Government have tried to play down the effects of Chernobyl, but the alarm was set off originally when the chief scientist of the radiochemical inspectorate telexed the Department of Energy at 21.30 hours on 5 May 1986. He reported high levels of radioactivity having been recorded in Britain. He added:
"Alpha emitters have been detected at not insignificant levels."
It is little wonder that the chief scientist was worried. At least one reading of caesium-137 in Cumbria was 16,900 bq/kg. That is rather meaningless to most of us, but it becomes meaningful when I tell the House that that was 600 times the normal reading. That was the level of exposure in certain hot spots in Cumbria and other parts of the United Kingdom after Chernobyl. In other words, the reading was serious.
It is interesting that this situation caught our scientists unaware. Even the Prime Minister wrote to me saying that she was surprised at these events.
The problem remains with us. Earlier this month one of the scientists at the Institute of Terrestrial Ecology, based at Grange-over-Sands in the southern part of Cumbria, was reported to have said:
"The radioactivity was safely locked away from plant uptake when it combined with clay. Unfortunately, these upland soils are very thin and not suited to locking away the cesium. It could be a case of years before it is locked away in the soil. There will possibly be a lot of unlocked cesium available in the soil for uptake this spring. We're not sure exactly how much yet."
That is the senior scientist of the ITE speaking about levels of radioactivity on the Lakeland hills. It is no wonder that the farmers, as they approach another lambing season, are worried about the effects of radioactivity. I have made that point at some length because it is important not to underestimate the Chernobyl position.
The section of the report that deals with nuclear waste is one that concerns me. There have been a number of debates on the subject in the House, and the hon. Member for Bedfordshire, North (Sir T. Skeet) he said repeatedly that he does not want nuclear waste to be stored in Bedfordshire. He said that again today, and many others have said the same when talking about their constituencies.
Sir Frank Layfield seems to think that the problem has been solved. In paragraph 41·2, the report states:
"The Department of the Environment believed that there were no technical difficulties in disposing of waste from any envisaged nuclear programme."
As the House knows, there is a world of difference between there being no technical difficulty and an acceptable solution. When it comes to issues such as radioactive waste, there must be a solution that is acceptable to the general public. The storage of nuclear waste under
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Billingham—that industrial, chemical town— was technically feasible, but it was politically a non-starter. There is no doubt about that.
Mr. Frank Cook: It will stay that way.
Dr. Clark: My hon. Friend the Member for Stockton, North (Mr. Cook) has made his point on a number of occasions most effectively.
Layfield's failure to appreciate that point leads us to doubt some of his other basic assertions. That is evidenced by his naive statement in paragraph 41–51, which says:
"Since 1976 a clear strategy for the management of radioactive waste has been established by Government; the means of putting that strategy into practice arc now emerging."
With respect, if Sir Frank believes that, he is not living in the real world. However, I am being a little unfair because he was precluded from discussing Her Majesty's Government's ever-changing policy in that respect since 1985. He was not permitted, therefore, to refer to the NIREX initiatives at Bradwell, Elstow, Fulbeck and Killingholme. I hope that those right hon. and hon. Members who protested most strongly about the deposit of nuclear waste in those areas will not go into the Lobby in support of the nuclear industry tonight because they must follow the logic of their arguments and stop the development of an industry that is producing waste that they are not prepared to accept.
In the same reference to nuclear waste, Sir Frank, in paragraph 41.53, says:
"steps must be taken to ensure that a site is ready early in the 1990s."
Is he being realistic, bearing in mind that the test drilling on the four sites will continue for at least another six months, that there will then have to be an evaluation and that then the Secretary of State has promised a public inquiry? I doubt whether that deadline can be met. The House must be convinced that Layfield's deadline is right or we should reject his report because that is a fundamental part of it.
Safety, as Layfield acknowledged,
"was the most important subject considered at the Inquiry."
He goes on to say:
"Any serious doubts about the fundamental safety of Sizewell B would be sufficient grounds for recommending that consent should be withheld."
I think that we would all go along with that viewpoint. In the same chapter he gives general approval to the safety provisions of Sizewell B, declaring:
"My confidence is founded principally on the quality of the CEGB's and NII's evidence, and the way in which it withstood searching and extensive examination."
That crucial statement appeared in volume 3 of the report.
Imagine my utter amazement when I read in volume 4 Layfield's detailed examination of the licences and procedure by which safety standards are set. In paragraph 49.1 he said:
"evidence showed that there were serious management and procedural weaknesses in the conduct of the licensing process."
He goes on to say:
"those weaknesses are of considerable significance."
In paragraph 49.17, he says:
"The inability of the NII to articulate clearly its responsibilities at the design stage suggests confusion in its thinking."
When I make those points I am not being critical of the NII, because it has been understaffed and underfunded and asked to do a job which was far too great for the

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facilities it has available. Nevertheless, Layfield found major shortcomings in the work of the NII. He goes on with an even more worrying statement:
"The high level of mutual understanding needed between the CEGB and the NII is not furthered by the lack of sufficiently clear and agreed safety criteria."
I was surprised when I went on and read criticism after criticism. Indeed, chapter 49 is riddled with similar criticisms. Therefore, I was not surprised to find that he said:
"The evidence showed serious weaknesses in the management of the licensing process, but emphasised the inherent difficulties facing the Nil and the CEGB."
Layfield started volume 4 with the assertion:
"Public opinion on the PWR will be affected by the confidence fell in the organisation of safety."
He followed that in paragraph 48.2 with the statement:
"The regulation of nuclear safety in the UK is centred on the licensing process."
Layfield is absolutely correct in his fundamental assessments. I put it to the House that, bearing in mind what Layfield repeatedly wrote in volume 4, there can be little public confidence in the licensing and thus the safety question.
Even more amazing is Layfield's statement in paragraph 47.64 that he is satisfied with the safety situation, as he has placed
"a great deal of reliance on the CEGB and NII to provide continuing assurance of safety."
All that contradicts what is written in volume 4.
The House will recall having been given repeated assurances by Secretaries of State that licensing would be completed before the inquiry began. Therefore, it is right and proper for the House to ask: why has that not been done and what is the standing of those numerous assurances today?
As we end this fairly short debate, another point must be made. It is appropriate to note that there is no unanimity of view among nuclear scientists on the safety of the PWR system. Lord Marshall, chairman of the CEGB, does not have it all his own way. My hon. Friends the Members for Stockton, North and for Linlithgow (Mr. Dalyell) quoted Ned Franklin, a former professor of chemical engineering at Imperial college and former managing director of the National Nuclear Corporation, who wrote an article which appeared in The Chemical Engineer of November 1986. I shall quote his comments again because they are vital. Understanding of this point may well change one's whole perspective of PWR.
Ned Franklin, who was a pro-nuclear man, was
"opposed to the construction in the UK of pressurised water reactors on the grounds that they are not sufficiently operator friendly under accident conditions. This view is based on a lifetime's experience which indicates that when operators are subject to conditions of extreme emergency arising from a combination of unforeseen circumstances they will react in ways which lead to a high risk of promoting accidents rather than diminishing them. This is materially increased if operators are aware of the very small time margins that are available to them … what is definitely intrinsic is that for water cooled systems the drive for economy leads to high fuel ratings and therefore to an extremely rapid sequence of accident events given an initiation due, for example, to the loss of coolant … to give sufficient statistical assurance that such a device will 'fly' without crashing, large degrees of redundancy in safety systems have to be provided. The consequent increase in complexity makes it even more likely that the operator, if he intervenes, will do something counter productive."
This evening, because of the shortage of time, I have not been able to deal with many other points in the Layfield
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report which we find rather doubtful. We have not even referred to the disastrous effect of Sizewell B on the natural environment and the heritage coast. I have not been able to refer to combined heat and power, district heating and renewable energy, which should be discussed. However, I hope that the Opposition have shown that events have changed dramatically since Layfield's deadline of 5 March 1985. My right hon. Friend the Member for Salford, East (Mr. Orme) has provided irrefutable evidence that the economic case can no longer be substantiated and I have shown how Chernobyl has changed the whole safety perspective.
"The golden rule of safety is that we must assume the worst that—anything which can go wrong will go wrong".—[Official Report, 23 May 1986; Vol. 98, c. 667.]
Those are the wise words of the Parliamentary Under-Secretary of State for Energy, the hon. Member for Eddisbury (Mr. Goodlad), and it is wisdom that Layfield fails to match in his report. I hope, therefore, that the House and the Secretary of State will reject the report.
9.55 pm
The Parliamentary Under-Secretary of State for Energy (Mr. Alastair Goodlad): I believe that we have had a most useful and constructive debate this afternoon and this evening. My right hon. Friend and I have listened most carefully to everything that has been said, and I know that my right hon. Friend will carefully study the transcript of the debate before he reaches his decision on the Central Electricity Generating Board's proposal. More than 20 hon. Members have spoken in the debate. Other Conservative Members had hoped to speak, but time ran out.
Mr. Powley: I draw my hon. Friend's attention to the fact that a number of hon. Members representing East Anglian constituencies wished to make a contribution to the debate in view of their nearness to the Sizewell 13 location. Because other hon. Members have taken rather too much time, they were unable to make what I consider to be valuable contributions.
Mr. Goodlad: My hon. Friend is quite right. My hon. Friends the Members for Norwich, South (Mr. Powley), for Norwich, North (Mr. Thompson), for Rochford (Dr. Clark) and for Northampton, South (Mr. Morris) were unable to participate as they wished. My hon. Friend the Member for Bury St. Edmunds (Sir E Griffiths) is a Suffolk Member whose constituency is near Sizewell. My right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) the Minister of State, Ministry of Agriculture. Fisheries and Food, in whose seat Sizewell is situated, has been present during the debate.
I should like to take the opportunity to record my deep appreciation for the painstaking and dedicated way in which Sir Frank Layfield approached his task. He faced one of the most demanding tasks in planning history and has discharged it with the most thorough professionalism. He opened the inquiry in January 1983 and heard over 340 days of evidence. This was the longest and most exhaustive inquiry in our history.
Evidence was taken from 195 witnesses on 344 occassions. Two hundred proofs of evidence were presented, supplemented by over 500 addenda, and 14 written statements were read. About 4,330 supporting documents were lodged with the inquiry secretariat. Over 4,000 letters of objection and 112 written submissions were

111
received. The amount of evidence submitted was vast. The 340 volumes of the daily transcript alone are estimated to contain 16 million words. I am sure that hon. Members who have read the inspector's report will appreciate the clarity with which he has handled this amount of evidence. We are all heavily indebted to him for his work.
I also wish to pay tribute, as I am sure does the House, to the four assessors who helped Sir Frank. Sir Christopher Foster assisted the inspector on economic matters, Dr. Vennart on the biological effects of radiation, Professor Hall on engineering matters and Professor Alexander on the transport of nuclear fuel. Each gave considerable time during the inquiry, often sitting with the inspector to hear evidence, and then afterwards devoted even more time to the preparation of the report.
I should also like to thank the staff of the inquiry who ensured its smooth running and gave the inspector the most valuable assistance with the preparation of the report.
As my right hon. Friend the Secretary of State said earlier, we must recognise the fundamental importance for the future of our decisions on the forms of energy that we seek to develop. We are making decisions that are likely to have a profound effect for decades to come. As my right hon. Friend concluded, the experience of this century and the nature of potential worldwide growth in the next century show that Britain and the European Community have a need to see that they pursue energy policies, in whatever form, that could meet the potential needs of the future.
This has been a wide-ranging and well-informed debate, and I should like to thank the House for the valuable and constructive contributions that have been made today.
Question put, That this House do now adjourn:—
The House divided: Ayes 0, Noes 191.

Division No. 98]

[10.00 pm

AYES

Nil

Tellers for the Ayes:

Mr. D. E. Thomas and

Mr. Allen Adams.

NOES

Abse, Leo

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

Alton, David

Brown, Ron (E'burgh, Leith)

Anderson, Donald

Bruce, Malcolm

Archer, Rt Hon Peter

Buchan, Norman

Ashdown, Paddy

Caborn, Richard

Ashley, Rt Hon Jack

Callaghan, Jim (Heyw'd & M)

Ashton, Joe

Campbell-Savours, Dale

Atkinson, N. (Tottenham)

Canavan, Dennis

Bagier, Gordon A. T.

Carlile, Alexander (Montg'y)

Banks, Tony (Newham NW)

Carter-Jones, Lewis

Barron, Kevin

Cartwright, John

Beckett, Mrs Margaret

Clark, Dr David (S Shields)

Beith, A. J.

Clarke, Thomas

Bell, Stuart

Clay, Robert

Benn, Rt Hon Tony

Clelland, David Gordon

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

Clwyd, Mrs Ann

Bermingham, Gerald

Cocks, Rt Hon M. (Bristol S)

Bidwell, Sydney

Cohen, Harry

Blair, Anthony

Coleman, Donald

Boothroyd, Miss Betty

Conlan, Bernard

Bray, Dr Jeremy

Cook, Frank (Stockton North)

Brown, Gordon (D'f'mline E)

Cook, Robin F. (Livingston)

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Corbett, Robin

Madden, Max

Corbyn, Jeremy

Marshall, David (Shettleston)

Craigen, J. M.

Martin, Michael

Crowther, Stan

Maxton, John

Cunliffe, Lawrence

Maynard, Miss Joan

Cunningham, Dr John

Meacher, Michael

Dalyell, Tam

Meadowcroft, Michael

Davies, Ronald (Caerphilly)

Michie, William

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

Mikardo, Ian

Deakins, Eric

Millan, Rt Hon Bruce

Dewar, Donald

Mitchell, Austin (G't Grimsby)

Dixon, Donald

Morris, Rt Hon A. (W'shawe)

Dormand, Jack

Morris, Rt Hon J. (Aberavon)

Douglas, Dick

Nellist, David

Dubs, Alfred

O'Brien, William

Duffy, A. E. P.

O'Neill, Martin

Eadie, Alex

Orme, Rt Hon Stanley

Eastham, Ken

Owen, Rt Hon Dr David

Evans, John (St. Helens N)

Park, George

Faulds, Andrew

Parry, Robert

Field, Frank (Birkenhead)

Patchett, Terry

Fields, T. (L'pool Broad Gn)

Pavitt, Laurie

Fisher, Mark

Pendry, Tom

Flannery, Martin

Pike, Peter

Foot, Rt Hon Michael

Radice, Giles

Forrester, John

Randall, Stuart

Foster, Derek

Raynsford, Nick

Foulkes, George

Redmond, Martin

Fraser, J. (Norwood)

Rees, Rt Hon M. (Leeds S)

Freeson, Rt Hon Reginald

Richardson, Ms Jo

Freud, Clement

Roberts, Allan (Bootle)

Garrett, W. E.

Roberts, Ernest (Hackney N)

George, Bruce

Robertson, George

Gilbert, Rt Hon Dr John

Robinson, G. (Coventry NW)

Godman, Dr Norman

Rooker, J. W.

Golding, Mrs Llin

Ross, Ernest (Dundee W)

Gould, Bryan

Ross, Stephen (Isle of Wight)

Hamilton, James (M'well N)

Rowlands, Ted

Hamilton, W. W. (Fife Central)

Sedgemore, Brian

Hancock, Michael

Sheerman, Barry

Hardy, Peter

Shields, Mrs Elizabeth

Harrison, Rt Hon Walter

Shore, Rt Hon Peter

Hart, Rt Hon Dame Judith

Short, Ms Clare (Ladywood)

Healey, Rt Hon Denis

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

Heffer, Eric S.

Skinner, Dennis

Hogg, N. (C'nauld & Kilsyth)

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

Holland, Stuart (Vauxhall)

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

Home Robertson, John

Snape, Peter

Howarth, George (Knowsley, N)

Soley, Clive

Howell, Rt Hon D. (S'heath)

Spearing, Nigel

Howells, Geraint

Steel, Rt Hon David

Hoyle, Douglas

Stewart, Rt Hon D. (W Isles)

Hughes, Robert (Aberdeen N)

Stott, Roger

Hughes, Roy (Newport East)

Strang, Gavin

Hughes, Sean (Knowsley S)

Straw, Jack

Hughes, Simon (Southwark)

Thomas, Dr R. (Carmarthen)

Janner, Hon Greville

Thompson, J. (Wansbeck)

John, Brynmor

Thorne, Stan (Preston)

Kaufman, Rt Hon Gerald

Tinn, James

Kennedy, Charles

Wallace, James

Kirkwood, Archy

Wardell, Gareth (Gower)

Lamond, James

Wareing, Robert

Leadbitter, Ted

Weetch, Ken

Lewis, Terence (Worsley)

Welsh, Michael

Litherland, Robert

White, James

Lloyd, Tony (Stretford)

Wigley, Dafydd

Lofthouse, Geoffrey

Williams, Rt Hon A.

Loyden, Edward

Winnick, David

McCartney, Hugh

Woodall, Alec

McDonald, Dr Oonagh

Wrigglesworth, Ian

McGuire, Michael

Young, David (Bolton SE)

McKay, Allen (Penistone)

MacKenzie, Rt Hon Gregor

Tellers for the Noes:

McNamara, Kevin

Mr. Frank Haynes and

McTaggart, Robert

Mr. Ray Powell.

McWilliam, John

Questions accordingly negatived.

REME Workshop, Chilwell
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Portillo]
10.11 pm
Mr. Jim Lester: I am delighted to have this Adjournment debate because, as you may know, Mr. Speaker, throughout last week the Opposition were unsure as to whether they would vote in the Aye Lobby or the No Lobby. My debate has been off and on, but since they voted tonight that the House should not adjourn, I can make a constituency case to the House about which I feel strongly.
My hon. Friend the Minister will know that since 25 June 1984, when the first notification of the closure of 38 REME workshop was received in my constituency, the trade unions and I have tried to offer constructive proposals to the Ministry of Defence, with a real interest in the defence capability as well as my constituents, to reverse that decision. I acknowledge that every facility has been given to me and my constituents to make that case. Indeed, after two trade unionists met the Secretary of State in July, we received a letter on 18 December in which he said that although it would be impossible to reverse the decision,
"I appreciate that the closure of 38 Central Workshop is a very painful process for our employees there; and I naturally regret this."
Events since then have made the closure even more painful and the knife has been turned in the already sore wound. Tonight I wish to make one more attempt, first, to ensure that the men affected are treated fairly and, secondly, on the basis of real evidence, to prevent the Ministry of Defence from falling into a no-win situation where they may lose the skills inherent in 38 REME workshop. It is the only place in the entire REME set-up where a tank can be totally stripped, repaired and rebuilt. The Ministry of Defence might discover that, for reasons that have been argued many times, even by rejigging existing provision, Bicester workshops, which will take part of the work from REME in Nottingham, will be unable to meet the targets set. The review that was designed to save money glossed over the most important element, which is a trained, coherent, committed work force. It takes years to create those skills and that ability, and it is easily dispersed. I submit to my hon. Friend that people and skills really matter.
May I deal first with fairness. Despite the fact that the operation of 38 REME workshop has been extended to build engines, many men—especially those aged under 50—with considerable service have been advised to take voluntary redundancy before April 1987 on the grounds that no better terms would be available and that the quicker they entered a difficult job market the better for them, because they might find alternative work.
Some have followed that advice. I am satisfied that at no time were they advised by their trade unions that the unions were negotiating a new redundancy package which affects all Ministry of Defence workers and which was first announced on 2 December 1986. It was a fundamentally changed basis of redundancy which represented a real improvement for the over-50s in technologies that are unlikely to get more orders. They are the very people who are working out their voluntary notices.
The transition arrangements are worked out on a national basis. Intelligently, we always introduce them, but
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here they miss virtually every man at the workshops who is now under notice. The already painful process of losing a job has turned into a lottery which affects some 556 men significantly.
I should like to quote from just one letter of the many that I have received. It is from Mr. Hadfield. He wrote:
"Dear Jim Lester,
As you know, 38 Central Workshop, Chilwell is closing down. I am being made Redundant on 27 March 1987. With the new Redundancy Terms starting April 1, I would have been getting about £12,000 more Redundancy pay. I feel it is very unfair that some employees will be getting up to three time their original Redundancy pay, whilst others like myself stay on the old terms. We are all being made Redundant from 38 Central and I feel we should always all be treated equally. I am 49 years old and have been at Chilwell for 10 years as a Coach Trimmer … With taking … promotion … men with less service will be there after me, which I was not told at the time."
People with less service will get more redundancy pay.
My hon. Friend the Minister will I am sure agree that this is a matter of heartfelt concern. People who have given many years' service have patently been given wrong and damaging advice.
I agree with the way in which the Nottingham Evening Post summed it up when it reported:
"It seems inconceivable to us that the date for this scheme could have been agreed in ignorance of the Chilwell situation. It must be the largest body of civil servants being made redundant at the present time, so it could hardly have gone unnoticed.
And if the Chilwell redundancy date was know n, then steps should have been taken to treat the workers there as a special case."
The argument that I want to put before my hon. Friend the Minister is that there is a fair way out.
The non-industrial staff have terms and conditions which allow them to choose which option is most beneficial. I acknowledge that the majority of workers at the workshops will benefit from the new arrangements. The unfairness arises for the people who have been advised to take voluntary redundancy in the last year. They will be badly affected. Some people in their 50s who worked on the basis of getting a redundancy payment to set up in small business or whatever will not have that option under the new scheme, but a pension arrangement instead. I ask my hon. Friend to consider this matter. If it would be helpful, I shall be pleased to see him and discuss the details.
My hon. Friend will know that there has been voluminous correspondence over a considerable period of time. I know that he has been to Bicester. He wrote to me on 31 December 1986 as follows:
"As for the difficulties affecting Bicester which led to the adjustment of the Chilwell rundown plan these are being overcome. The recruitment of non-industrial supervisory staff has improved and is now well back on track. Recruitment of industrial staff of the right calibre is admittedly more of a problem because of the relatively high cost of housing in the Bicester area and the competition with other industries in Oxfordshire. Steps have, however, been taken to attract recruits from our maturing apprentices from other REME Base and District Workshops and from the Chilwell workforce, as well as through local job centres and the media. Manning levels are in consequence very nearly up to requirements."
I quote that part of the letter because recently another letter came into my possession from a Mr. Ward who is the unit civilian staff manager responsible to Colonel Ayscough, who is the chairman of the local joint productivity council which is doing the recruiting. My experience of Bicester goes back to when I was stationed there in 1950–51. Mr. Ward's voice is much more accurate

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and authentic, because he is the man at the sharp end who has responsibility for recruiting these very scarce and necessary craftsmen. His letter says:
"The facts are these. There is a shortage of Vehicle and Electrical Fitters in Oxfordshire. The wages the Ministry of Defence pays equates, at best, to that of a semi-skilled person in outside industry in this area. For this rate of pay we ask the highest qualifications of a formal apprenticeship. There is not a great pool of unemployed craftsmen in Oxfordshire awaiting to start work here, nor is there a group able to increase their earning power by giving up their present job and coming to work at 32 Base Workshop."
Then Mr. Ward talks about recruitment from a distance. The letter says:
"Now let us turn to recruitment from a distance. It is true that there is a large number of unemployed people in various parts of this country. Among those there are craftsmen but, believe it or not, those who have been made redundant in ship-yards, coal-mines, steel-works, railway workshops and the like do not have the qualifications and experience you demand. When recruiting from a distance not only does pay present a problem but so does housing. In the last 12 months the lowest priced housing in this area has advanced from around £30,000 to £40,000 and the trend is upward. Prospective employees are not prepared to sell their own house for £25,000 in the North, which in some places is a substantial property, and come down here and live in a box for a mortgage they cannot afford on the wages paid by MOD. They are not prepared to step down from home ownership to rented accommodation."
Two sentences in this letter bear out the fears that I have had the whole time. They read:
"At the time the decision was taken to expand operations in Bicester it was made known to all concerned that there would be difficulties recruiting all forms of craftsmen. We have exactly the same difficulties over Painters and Carpenters for the COD."
The letter goes on to say:
"the Department of Employment is continually approached, but I am not responsible for their inadequacies. We are not pursuing new advertising avenues through the Daily Mirror's Job Line and that service provided by Central TV on Teletex. There arc therefore many aspects of the recruitment of craftsmen which are beyond our control or perhaps even influence. We cannot change the cost of housing in Oxfordshire nor can we alter Government legislation. We have little chance of changing wage levels, though we may have a little influence."
The only proposal that he can make is that they dilute the skills required simply to make to make up the numbers. Yet these men are charged with the responsibility of repairing our A vehicle, the Chieftain tank, an essential part of our defence capability. I should like to make one further point from this letter. It indicates to those who were not present at the meeting as a result of which the letter was written, that no recruiting had taken place in September 1986. The letter says:
"The wastage rate is of great concern to me. A cursory look at this wastage indicates that craftsmen leave for the same reasons as we cannot recruit them. On the 9 January 1987, for instance, you lost a Vehicle Mechanic, who we recruited in September 1986, who left for other employment. Others who left just before Christmas did so for employment giving more money or because there were difficulties living away from home."
That letter echoes an authentic voice speaking about the real problems of getting a committed craftsman in the centre at Bicester who would stay and build on the acknowledged skills that my constituents have gained over many years to provide the service that the armoured divisions require.
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I put it to my hon. Friend most emphatically that he should take this question seriously. I would welcome him on an urgent visit to Chilwell. As I said at the beginning, a reappraisal will be too late if it is not done quickly. The skills and capacity will have gone before capital expenditure at Bicester is undertaken, and the sheer inability to recruit sufficiently skilled men to meet the task is well proven.
I return to the original constructive suggestion that we made on behalf of 38 REME workshop at Chilwell. It should be kept in existence so long as Chieftains stay in Army service. The Chieftains should go to Chilwell and the Challengers to Bovington. That solution would be better for the Army and my constituents and would do something to correct the drift from north to south about which politically, in terms of employment and jobs, we should be extremely conscious.
10.25 pm
The Parliamentary Under-Secretary of State for the Armed Forces (Mr. Roger Freeman): I congratulate my hon. Friend the Member for Broxstowe (Mr. Lester) on securing this Adjournment debate, and I pay tribute not only to the interest he has shown in the future of 38 central workshop at Chilwell but also to his concern to ensure that the Army continues to receive the support that it needs from the REME static workshop organisation as a whole. I am sure that those of his constituents who work at 38 REME workshop, Chilwell, are appreciative of all the efforts that he has made over recent years, as on this occasion, in pursuit of the interests as well as those of the Army as a whole.
My hon. Friend raised two issues. The first was the effect of the new redundancy provisions that will operate from 1 April. The second was the recruitment problem at Bicester. I shall try to deal with both issues. However, it might be helpful if I take this opportunity to explain the basis of the reorganisation of the REME workshop organisation which is currently under way and how it is progressing.
Before dealing with the specific points raised by my hon. Friend, I should like to set out briefly the principles that underly the plan that we announced in June 1984—and following a period of consultation with all interested parties confirmed in December 1984—to rationalise the static workshop organisation in this country, of which the sad closure of No. 38 central workshop at Chilwell is but one element.
The first principle is our duty to the taxpayer to ensure that the funds which Parliament has voted to meet defence needs are applied in the most cost-effective and efficient manner. The MOD review of the REME static workshop organisation in 1982 was undertaken against that background. It showed that overall the organisation was running with substantially more capacity than the Army would need to meet its forecast workload—nearly 20 per cent. more, to be precise. Clearly, retaining excess capacity of that order is not efficient or economic, and we accordingly needed to reduce the overhead costs of the operation. That meant concentrating the Army's base repair work at fewer workshops. I ask my hon. Friend to contemplate those essential facts. With overcapacity in the REME central workshops, it was essential for us to contract the reorganisation for efficient and economic reasons.

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The second principle we have followed is that work should not be retained in-house if it can be done satisfactorily but less expensively by industry, except where operational considerations preclude this. We therefore looked at the scope for putting out to contract repair work, in particular on equipment of relatively low operational priority and significance—for example, B vehicles. By having repair and overhaul work on such equipment performed under competitive contract, we found that we could obtain better value for money and significant cost savings.
The plan that we announced in 1984 involved the closure of the workshops at Chilwell and Newark and an expansion of those at Bovington, Bicester and Old Dalby, a substantial increase in the amount of base repair work carried out by contract, and manpower reductions of the order of 500. This would produce a leaner overall organisation with the right capacity and at the right locations to meet the Army's requirements and deployment.
That plan has significant consequences for many of the Army's employees. Therefore, we made every effort to ensure that ample time was allowed for consultation with the work force and its trade union representatives. I hope that my hon. Friend will agree that we have gone to considerable lengths to consult the trade unions and their representatives both in the trade unions and in Parliament. As my hon. Friend will be aware various delegations and representations were received by Ministers and their officials. Our decision to proceed with implementation of the rationalisation plan was taken only after most careful consideration of all the points which had been put to us.
Over the past two years since we announced that decision most of the changes to which I have referred have been proceeding according to plan. For example, the transfer of the residual load from 33 central workshop at Newark into 35 base workshop at Old Dalby has now been completed. The transfer of part of the workload of 38 central workshop, Chilwell into 18 base workshop Bovington and 34 base workshop Donnington is also running well on schedule.
At the beginning of his speech my hon. Friend implied that tanks can be stripped and repaired only at Chilwell, but Bovington also has that capacity. However, there have been some difficulties over the transfer of the residual part of the Chilwell workload to the workshop at Bicester. These have led to a one-year deferment, to March 1989, of the originally planned closure date for 38 central workshop, although the bulk of the manpower savings expected from closure will still be achieved by March 1988.
The rundown of the workshop at Chilwell is already well under way. Its total strength has already reduced by more than half since May 1984. Its industrial strength has reduced by 260 by the end of January this year and 154 of the workers there have received compensation on early retirement terms. We expect that a further 59 members of the work force will have left on similar terms by the end of March. Fifty-four of those who have already left have been transferred to other Ministry of Defence employment and have received the normal public assistance with the costs of their transfers to other locations.
My hon. Friend mentioned the fact that the new terms for early retirement were announced on 1 December 1986 to take effect from 1 April 1987. These represent a significant improvement for members of the industrial Civil Service leaving on redundancy. Negotiations on these
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new terms began in 1985, and in June 1986 a joint statement was made by management and the trade unions informing all staff—I stress "all staff" including those at Chilwell—of the broad outline of the new arrangements.
My hon. Friend suggested that that created some inequity for those who have already left or expect to leave prior to 1 April. I shall certainly look with care at his point and write to him. If a meeting would help, I am happy to have one. I must make it plain that our run-down plans at Chilwell pre-date these general improvements for the industrial Civil Service. Irrespective of them, we have still needed to meet our manpower target reductions by voluntary or, sadly, compulsory redundancies. As I have said, I shall consider further the seeming inequity created by the new redundancy provisions and write to my hon. Friend.
I turn now to the financial aspects of the static workshop review and the question whether the balance sheet of costs and savings had altered since our decisions were announced in 1984 in a way which affects its validity.
As my hon. Friend knows, we undertook a re-appraisal of the original costings last year at the request of the trade unions. This, indeed, showed some changes. The expected non-recurring net savings—that is, once-only savings net of once-only expenditure—have reduced from just over £1 million to £300,000. However, the expected recurring net savings have increased from £750,000 to £2·5 million per annum. This increase in the recurring savings has arisen largely because the costs of putting work to contract are less than orginally estimated. The figures that I have quoted do not include redundancy costs. We estimate that these might amount to about £4 million for the two workshops at Newark and Chilwell which are closing. Nor do they include the extra costs of about £1 million arising from keeping the Chilwell workshop open for an extra year until 31 March 1989. However, my hon. Friend will see that even if these additional elements are taken into account, we should break even within two years of full implementation of the reorganisation. Therefore, there are no financial grounds for reconsidering our decision.
The point was also raised whether the revised disposition of repair work under the plan would guarantee that the Army continues to receive the repair service that it requires, especially in the light of the loss of the expertise which exists at Chilwell. I pay tribute to the long and dedicated service of those who have worked and are still working at Chilwell.
I am satisfied that the Army will continue to be well served. For example, the concentration of tank main equipment repair at Bovington will capitalise on experience there of handling first and second line tank repair. As I have already mentioned, the transfer of this work is going well, and the people we are recruiting as skilled fitters have all completed four-year apprenticeships and are thoroughly competent to undertake the work we require of them.
I turn now to the recruiting problems at Bicester. It is true that recruiting was always likely to be more difficult at Bicester than at Chilwell. Factors such as competing local industries and housing all contribute to this. My hon. Friend was right to emphasise that.
The problem needs to be put into perspective. For example, 18 months ago the Bicester workshop employed 34 industrials as the direct labour force—that is, those who actually carry out the repair work as opposed to those who supervise or work in a supporting capacity. Today.

119
their number has risen to 73, which is only 10 fewer than the number required for the prime task—the repair of heavy armoured vehicle assemblies. The plan requires an increase to 145 by March 1989 to cater for the other work that we intend to transfer to the Bicester workshop in order to provide a balanced work load. The current rate of recruiting may leave us a little short of this requirement.
There is sufficient flexibility within the static workshop organisation for part or all of this other repair work to be undertaken elsewhere at the continuing workshops. Indeed, this flexibility will stand us in good stead should the manpower reduction at Chilwell reduce more quickly in the future than we expect.
So, recruiting is proceeding reasonably well at Bicester, despite the difficulties. But we are not being complacent. The Department is taking vigorous steps to maintain and, hopefully, improve the rate of recruitment. I visited Bicester on 16 February, and was greatly impressed by those members of the work force whom I met. These included several young men from northern cities such as Liverpool, Sheffield and Leeds who were returning to their homes at the weekends. I am conscious that housing in the Bicester area is a particular difficulty and may be
120
hindering recruitment. Therefore, I have arranged for a review to be made of MOD-owned housing in the area to see what scope there may be for providing temporary accommodation for new recruits while they are seeking permanent housing.
To sum up on the main issues raised by my hon. Friend, we are confident that the rationalisation of the REME static workship organisation, of which the closure of Chilwell is a necessary part, is financially well founded. As my hon. Friend knows, all the ground has been gone over most thoroughly by my right hon. Friend the Secretary of State for Defence. He has made it clear that he can see no grounds for throwing the whole plan back in the melting pot at this late stage. We have a duty to manage our resources responsibly and cost-effectively and unfortunately this can involve painful decisions. We much regret the closure of 38 central workshop at Chilwell, which is a necessary but unpalatable consequence of our overall plans. I assure my hon. Friend that I shall take careful account of what he said about inequities, and I shall be writing to him.
Question put and agreed to.
Adjourned accordingly at twenty-two minutes to Eleven o'clock.

SOLICITOR-GENERAL FOR SCOTLAND
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Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES On the Woolsack.
Prayers—Read by the Lord Bishop of Carlisle.

Devonport Dockyard: National Security
Lord Diamond: 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 they are proposing to protect national security at Devonport dockyard under new management.
The Minister of State for Defence Procurement (Lord Trefgarne): My Lords, the vital interests of national security to which the noble Lord rightly refers will be protected by the existing arrangements, which apply to all defence contractors, and the foreign control safeguards written into the contract. In addition, companies involved in nuclear work will be required to operate in accordance with the relevant requirements of the Nuclear Installations Act 1965. The Government believe that these arrangements, taken together with the unchanged role of the Ministry of Defence Police, will fully meet the circumstances created by new management.
Lord Diamond: My Lords, I am most grateful to the noble Lord for that informative Answer. May I ask for a little clarification on what he said about nuclear arrangements? Am I correct in believing that no American is allowed to see the propulsion unit of any nuclear submarine being built at Barrow? If that is correct, can he say whether the Government are quite content about the new arrangements there under which an American company with Libyan connections is available to maintain those propulsion units?
Lord Trefgarne: My Lords, the Libyan connection to which the noble Lord refers relates, I understand, to the construction there of an irrigation facility. Let me be quite clear about the extent of Libyan involvement in this country. There are, I understand, two Libyan nationals based in the Brown and Root office—I think that is the firm to which the noble Lord refers—in Kingston. Brown and Root's dockyard team operates from quite separate offices in Colliers Wood, to which the Libyans will not of course be allowed access. The two projects are quite separate.
I assure the noble Lord that we are quite satisfied with the current security arrangements for premises and staff employed by Brown and Root (UK) Ltd.—which, as the noble Lord will be aware, is the Government's favoured contractor for the Devonport contract—at its sole office dealing with matters affecting Devonport dockyard.
Lord Irving of Dartford: My Lords, leaving aside the nuclear aspect, in view of the fact that an American company will be tendering and it is the Government's present policy to have competitive tendering for defence equipment, can the noble Lord assure us that an American company will have no advantage over a British company in tendering for defence contracts?
Lord Trefgarne: My Lords, I am happy to give the noble Lord the assurance for which he asks. We have had a successful competition with regard to both of the dockyards. But I emphasise that my right honourable friend has not quite made up his mind with regard to the Devonport contract.
Lord Graham of Edmonton: My Lords, as the Minister is talking about national security, can he also say something about local security? Can he tell us how the discussions and consultations (which are part of the legislation) in respect of the social and economic consequences of the privatisation for the city of Plymouth are going ahead?
Lord Trefgarne: My Lords, if the noble Lord will forgive me, that is a rather different question. However, I can tell him that my right honourable friend has now completed his consultations with

3
regard to the Devonport contract and will be making up his mind shortly.
Lord Lloyd of Kilgerran: My Lords, can the noble Lord either now or later clarify the position in relation to any intellectual property rights that may arise with employees at Devonport or in relation to contracts placed?
Lord Trefgarne: My Lords, intellectual property rights are not one of the major issues that have arisen during our consultations on these contracts, but the noble Lord can be assured that, such as they are, they will be properly protected.
Lord Denning: My Lords, in view of the great importance to our national security of the Royal Dockyard at Devonport may I ask, especially in view of the nuclear implications, whether the Minister would reconsider the position of the control of the dockyard? Should it not be entirely under British control and free from any foreign influence whatsoever, and indeed be kept as a Royal dockyard? Ought not the proposed vesting date, 5th April, be put back a little for considerations of security to be further examined?
Lord Trefgarne: My Lords, I should perhaps underline the fact that Brown and Root (UK) Ltd., which is a United Kingdom company, but controlled by an American parent, will have just 30 per cent. of the shareholding in Devonport Management Ltd. That is the maximum limit that we have set under the contract, as the noble and learned Lord will be aware. The Government have carefully examined the issue and we are quite satisfied that we have arrived at proper arrangements. But I emphasise that my right honourable friend has not yet reached a final conclusion.
Lord Cledwyn of Penrhos: My Lords, is it not inevitable that national security should be at a greater risk following privatisation? Can the noble Lord say a word about the two Libyans? Who are these two Libyans? Are they employees of the Libyan Government and Colonel Gaddafi, and are they the only Libyans employed in these sensitive areas?
Lord Trefgarne: My Lords, as I said earlier, these Libyans have nothing whatever to do with the matter that we are now discussing. They are concerned with the construction of an irrigation facility in that country, which has no connection whatever with the activities of Brown and Root so far as the dockyard is concerned.
Lord Cledwyn of Penrhos: My Lords, will the Minister answer my question and say whether there are any other Libyan nationals employed in sensitive areas such as this?
Lord Trefgarne: My Lords, to the best of my knowledge and belief there are no other Libyans involved.
Lord Mellish: My Lords, can we have an assurance on how long the Libyan connection is to go on? When will the work they are doing end? Can we have an assurance that there will be no more work given to Libyans?
Lord Trefgarne: My Lords, as I understand it the Libyan involvement relates only to the irrigation facility contract to which I have referred. I therefore presume that the Libyans will return to their country when that contract is completed.
Lord Diamond: My Lords, is not the Minister aware that there is considerable anxiety in the House both about the Libyan connection and about the nuclear situation? Does he recollect that one of his own Back-Benchers, on the last occasion this matter came before the House, asked him whether he could remember any possible case where the Americans were doing the same with us in reverse? The answer was that there was no possible suggestion of the Americans being as foolish in a contract which we might have in one of their dockyards as they are with us. Does the noble Lord realise that he simply has not answered fully the question as to why there is this totally inconsistent treatment? Why do we deny Americans the right to see the propulsion unit and give a firm—which I repeat has Libyan connections and, in spite of what the Minister says, has a majority control of the work—the right to inspect what other Americans are denied in Barrow?
Lord Trefgarne: My Lords, access to our most sensitive equipment is determined on a case by case and a need to know basis. It is not determined by the nationality of those involved, though clearly those from some nationalities would have very great difficulty indeed in persuading us that they had business to have access, say, to our nuclear facilities. As for Brown and Root itself, I remind your Lordships that that company very recently received the Queen's Award for Technological Achievement, which is an award not lightly given to unreliable companies.

Gibraltar: Heritage and Land Transfer
2.45 p.m.
Lord Merrivale: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are satisfied that the planning procedures in Gibraltar are adequate to safeguard its heritage when they make defence lands available to the Gibraltar Government for development.
Lord Trefgarne: My Lords, the safeguarding of Gibraltar's heritage is a domestic matter for the Government of Gibraltar, as is the use of defence lands that are transferred to them; similarly, responsibility for planning procedures rests with that Government.
Lord Merrivale: My Lords, I thank my noble friend for that not unexpected reply. Is he aware that the proposal to build a hotel on top of Engineers Battery has been approved in spite of the 1982 report Save

5
Gibraltar's Heritage, which states that it would be a disaster in scenic terms? As planning policies and individual planning decisions are not open to public discussion, because there is now no legal redress in planning matters, will the Minister be willing to consider attaching conditions when MoD land surplus to requirements is transferred?
Lord Trefgarne: My Lords, I do not think it would be appropriate for us to proceed as my noble friend suggests. The Government of Gibraltar are responsible for these matters and we have no power to direct them, if that is what my noble friend has in mind, or for that matter to impose what we know they would find unacceptable conditions upon the transfer of the land. The availability of land in Gibralter is very strictly limited and thus sites for development, even important developments of the kind that my noble friend refers to, are hard to find.
Lord Irving of Dartford: My Lords, can the noble Lord say whether the Government of Gibraltar have indicated a wish to develop at any places other than Rosia Bay and Queensway; whether there is anticipated to be a significant increase in employment; what the development costs will be and whether the British Government are contributing to those development costs?
Lord Trefgarne: My Lords, the Government are not directly responsible for providing money for these developments, but we generally transfer the land free of charge, and that is a considerable contribution.
Lord Molloy: My Lords, is the Minister aware that the Gibraltarians are very proud of their heritage and their close links with the United Kingdom? We hope, for example, that the Barbary apes will not be endangered by any developments, but if there should be any cause for the Government to be apprehensive will they proffer assistance and guidance if that is necessary?
Lord Trefgarne: Yes indeed, my Lords. The Government are always willing to offer advice to the Gibraltar Government on this matter, but I emphasise that it is only advice. Indeed, we sit on the committee that deals with these things. That committee is called the development and planning commission, which has four Gibraltarians and two British members as the voting committee.
Lord Merrivale: My Lords, does the Minister recognise that there is a precedent for attaching conditions, as a condition was imposed when the old command education centre was tranferred in May 1975?
Lord Trefgarne: My Lords, I think that if we were to attach such a condition these days it would be regarded as undesirable.
Lord Leatherland: My Lords, can the Minister assure us that Gibraltar will still be of use to us as part of our defence organisation?
Lord Trefgarne: Yes of course, my Lords. Although the dockyard is now under commercial management in Gibraltar, Gibraltar remains a very worthwhile and useful facility for the Royal Navy. Indeed, even the dockyard itself is currently undertaking quite a bit of Royal naval work.

Food and Drink Marketing
2.50 p.m.
Baroness Elliot of Harwood: 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 progress is being made in improving the marketing of British food and drink.
Lord Hesketh: My Lords, the Government attach particular importance to this issue and Food from Britain's work in this area. Since 1983, Food from Britain has spent about £15 million in improving marketing, most of it provided by the Government. It has established the British quality foodmark scheme, which began with five products in 1985 and now covers 22. In each of the past two years, its export promotions in Benelux, France, West Germany and the USA have resulted in direct sales worth over £30 million. In 1985, total food exports to those markets increased in value by 9 per cent. compared with 1984, and in the first nine months of 1986 by 5 per cent. compared with the first nine months of 1985.
Baroness Elliot of Harwood: My Lords, I thank the noble Lord for that admirable Answer. I am delighted that things are going so well because this is one of the most important subjects that one can think of. The over-production from which the agricultural industry is suffering can only be dealt with by finding more consumers and more markets. Therefore I hope that the Government will continue to encourage every kind of selling operation which would help the industry.
Lord Hesketh: My Lords, I should very much like to thank the noble Baroness, Lady Elliot, for her very useful comments on something which the Government consider to be a success.
Lord Boyd-Carpenter: My Lords, can my noble friend confirm that one export within the category of this Question which requires absolutely no promotion or pushing is Scotch whisky?
Lord Hesketh: My Lords, I am very grateful to the noble Lord, Lord Boyd-Carpenter, for his question. The fact is that this year Scotch whisky exports will exceed £1,000 million; and, as he rightly points out, it is not an area where the Government need to give assistance as regards marketing.
Lord Strabolgi: My Lords, following the question of the noble Lord, Lord Boyd-Carpenter, is the noble Lord aware that the marketing of Scotch whisky in Japan is experiencing very great difficulties owing to the extremely high import tariffs imposed by the Japanese? Are the Government doing anything about this?
Lord Hesketh: My Lords, I am going to have to write to the noble Lord on that question.
Lord Gallacher: My Lords, as marketing is at the heart of this Question, can the noble Lord say whether the Government are satisfied that major British food retailers are adequately represented on the council of Food from Britain?
Lord Hesketh: So far as I am aware, yes, my Lords.
Lord Lloyd of Kilgerran: My Lords, can the noble Lord the Minister give assurances that the problems involved in the marketing of Welsh lamb in France have now been completely overcome?
Lord Hesketh: My Lords, I am not aware that there is a problem now.

Economic Growth
2.52 p.m.
Lord Beswick: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what informa-tion was available to the Secretary of State for Employment about the current United Kingdom trading account when he made the statement on 28th January that we are "entering our seventh successive year of economic growth". (H.L. deb. col. 1332)
The Secretary of State for Employment (Lord Young of Graffham): My Lords, I based my statement that,
"we shall shortly be entering our seventh successive year of economic growth"
on our achievement of six years of uninterrupted growth, averaging around 3 per cent. a year, the low rate of inflation and the fact that since the last election ours has been the fastest-growing major economy in the European Community. All independent forecasts predict continued growth this year.
Lord Beswick: My Lords, I am grateful to the noble Lord for his usual statement of how well we are doing. Does he not now agree, looking back, that it would have been better had he stated on the 28th January that despite those seven successive years of growth we were, for the first time in those seven years, going into deficit on our trading account?
Lord Young of Graffham: No, my Lords, most assuredly not, because our current balance this year is broadly in balance and I have to do no more than look at the independent forecast made today by the Confederation of British Industry to have a real look to see what lies ahead of us in our country.
Lord Beswick: My Lords, does the noble Lord agree with the statement by the DTI which was made at the same time as his own that we were for the first time in those seven years going into deficit to the tune of £187 million, not in manufacturing only, but overall?
8
Would it not have given us a much more balanced picture of our economic state of affairs had he included that information?
Lord Young of Graffham: No, my Lords, but I am very grateful to the noble Lord, Lord Beswick, for putting this question today so that we can at least ventilate this particular problem. It is misleading just to look at one component of the whole picture. Much more important is to look at the overall current account, which is in broad balance. Perhaps I may say that from 1979 to 1986 it showed a cumulative surplus of something like £21 billion as against a cumulative deficit of some £5 billion between 1974 and 1979.
Lord Bruce of Donington: My Lords, is the noble Lord aware that we on this side of the House will welcome economic growth at any time? However, is he also aware that the economic growth to which he refers is due entirely to the fact that our oil output during that time increased by no lesss than 60 per cent. over the figure that it was in 1980? Can the noble Lord now tell us when the output from manufacturing industry in the United Kingdom is likely to reach the level that it was in 1979?
Lord Young of Graffham: My Lords, what is actually much more to the point is that manufacturing exports are now picking up strongly and they rose by 5 per cent. in the last quarter of 1986 compared with a rise of only 3½ per cent. in manufactured imports. There is no doubt that so long as we maintain a considerable improvement in United Kingdom unit wage costs, which in this country are rising lower than the rate of inflation and lower than the rates in Germany and Japan, we can look forward to a very good future for exports.
Lord Diamond: My Lords, is the noble Lord aware that he would have given the House a fairer descrip-tion of the growth of this country, to which this Question referred, if he had started his figures from the point of time at which his Government took power and had responsibility for them? Is it not the case that whereas the long-established trend in this country over this century is a growth rate of 2.4 per cent. per annum, the average growth rate achieved by this Government is one half of that?
Lord Young of Graffham: My Lords, I do not desire for one moment to indicate from any statement that we are about to enter our seventh year of successive growth: nor do I need, at any time I make a speech or a statement, to have to go back with a caveat for the year when we first came into power—for the year when there was last a Liberal Government for that matter—or for any other particular matter. In fact, I must say that I look with great satisfaction at the amount of growth that we have achieved in the past seven years, and I compare it with the amount of growth that we achieved during the 1970s.
Lord Leatherland: My Lords, can the Minister tell us whether there are still over 3 million unemployed people in this country?
Lord Young of Graffham: My Lords, yes, there are over 3 million umemployed in this country.
Lord Beswick: My Lords, is the noble Lord aware that I look back with some satisfaction to the fact that last year the aerospace industry had exports of £4.74 billion? We draw satisfaction from that; but ought not the noble Lord also to be considering what kind of growth is represented by the rest of the figures that he gives? Is it not an extraordinary growth that we have seen in the country recently in the business of selling loans and getting us all into debt? Has there not been an extraordinary growth in the number of unnecessary estate agents? Was there not an extraordinary figure of £500 million expended last year in the business of arranging mergers? Is that kind of growth going to earn us our living in the future?
Lord Young of Graffham: Yes, my Lords, I have no objection to growth so long as it is properly based, and this growth is properly based. Unlike the recovery that we had in 1975 and 1979, fixed investment grew in real terms by over 4 per cent. a year from the first quarter of 1981 until the first quarter of 1986, compared with only one and a quarter per cent. per annum during that earlier period. This country is on a period of real economic growth, and it would do us well if we were to accept the judgment of the CBI in this matter and not try to pick holes in what is rapidly becoming a good performance.
Lord Bruce of Donington: My Lords, can the noble Lord now answer the two questions that I put to him?
Viscount St. Davids: My Lords, can the noble Lord confirm that the figure that is given as a deficit includes enormous sums in multi-millions that we are investing abroad? That has made us the third richest creditor in the world after Germany and Japan. It will also provide an income for us for generations to come after the oil bonanza has ceased.
Lord Young of Graffham: No, my Lords. I hate to take issue with the noble Viscount, but so far as I am aware we are the second highest overseas investor, preceded only by Japan.
Lord Beswick: My Lords, if the noble Lord is quoting the CBI, ought he not to make reference to the fact that the director general advised Ministers—and I have no doubt he had the noble Lord in mind—that we should not make headlines of the so-called boom in industry?
Lord Young of Graffham: My Lords, perhaps the noble Lord will not take it amiss if I say that I did not put down this Question on the Order Paper and I am quite happy with what I have said in that answer.
Lord Bruce of Donington: My Lords, will the noble Lord do me the kindness of answering the two questions that I put to him?
Lord Young of Graffham: My Lords, if the noble Lord would do me the even greater kindness of reminding me what they were.
Noble Lords: One question!
Lord Bruce of Donington: I feel bound in all courtesy to comply with the noble Lord's request and refresh his memory. I asked him whether he was aware that we on this side of the House were very pleased to welcome economic growth of any kind. But I also asked him whether he was aware that the increase in total output during that time was due to the fact that our oil output increased by 60 per cent. At the same time, I asked him whether he would give a date when he expected manufacturing output of the United Kingdom to reach the level it achieved in 1979.
Lord Young of Graffham: My Lords, if the noble Lord put the second part of that question down on the Order Paper he would find that even then I should be reluctant to answer it. I do not see that it is any part of my task to forecast when certain events are or are not likely to come about. What we are seeing now is manufacturing industry based on a firm foundation and moving forward. I hope that that will continue. If it continues in a satisfactory manner, I think we shall find that all will go forward.

Business
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Committee stage of the Local Government Finance Bill will be adjourned at approximately 7 p.m. for approximately one hour and that during this adjournment the Third Reading of the Debtors (Scotland) Bill will be taken.
Banking Bill
Brought from the Commons; read a first time, and to be printed.
National Provident Institution Bill [H.L.]
Read a second time, and referred to the Examiners.
Newcastle upon Tyne Town Moor Bill [H.L.]
Read a second time, and committed to an Unopposed Bill Committee.
Advocates' Widows' and Orphans' Fund Order Confirmation Bill
Read a third time, and passed.
Chevening Estate Bill [H.L.]
Read a third time; an amendment (privilege) made; Bill passed, and sent to the Commons.

Local Government Finance Bill
3.4 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Skelmersdale): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Skelmersdale.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 1 agreed to.
Schedule 1 agreed to.
Clause 2 [Rate fund revenue accounts: further provisions]:
Baroness David Baroness David moved Amendment No. 1:
Page 3, line 15, leave out subsection (4)
The noble Baroness said: This amendment calls for the deletion of subsection (4) of Clause 2, which empowers the Secretary of State to specify kinds of income expenditure to count against rate fund revenue account. I should like to say at once that this is by way of being a probing amendment.
Clauses 1 to 3 of the Bill put onto a legally robust basis the way in which relevant and total expenditure are calculated for rate support grant purposes. The need for Clauses 1 to 3 comes, at least in part, from a legal housekeeping exercise undertaken by the DoE following litigation by local authorities. One outcome of the exercise is to state in law things which authorities have been doing or things which are implicit in the Local Government, Planning and Land Act 1980. The concept of a rate fund revenue account is an example of this.
Clauses 1 to 3, in arriving at the construction of the rate fund revenue account—thus an authority's relevant total expenditure and thus its grant—have reference to three main criteria: first, the accounts specifically listed in Schedule 1 which are excluded from the rate of fund revenue account; secondly, proper practices; and, thirdly, the power of the Secretary of State to specify in respect of any year the kinds of expenditure or income to be debited or credited to a rate fund revenue account. Although there may be misgivings at leaving things in the hands of the accountancy bodies to define proper practices, it is the third item, the power of the Secretary of State to specify, which gives most cause for concern. It is for this reason that we propose its deletion from the Bill.
The Secretary of State seems to be taking powers to override proper practices. Why? In what circumstances will the Secretary of State not agree with proper practices as defined by local authority accountants and policed by local authority auditors? We should like to hear from the Minister on this. Is the key
12
in the Explanatory and Financial Memorandum, where Clauses 1 to 3 are stated only broadly to reflect,
"what has been done in practice for past years"?
Will the Secretary of State be using the Clause 2(4) power to pick off authorities on the basis of accounting techniques that they might have employed even in accordance with proper practices? Perhaps it should be remembered that Clause 9(6) provides that use of the power in Clause 2(4) may be only,
"in accordance with principles to be applied to all local authorities".
It was the anxiety of the local authority associations which I quoted at Second Reading and I should like to repeat what I said at that point. The ACC said about Clauses 1, 2 and 3 that they,
"are of particular concern as they contain greater powers of interference and control than are necessary to achieve the objects of the Bill".
The ADC expressed its concern at the poor drafting. Its letter to me said that it was confused by the references in Clauses 1, 2 and 3 to proper practices juxtaposed with the proposed powers to enable the Secretary of State to specify certain types of expenditure. It also said:
"The Bill's main focus should be on validating past actions, not introducing new areas of political conflict".
There has been no satisfactory explanation as to why the Government believe they need this power, so we hope that the Minister will explain.
I apologise. In moving Amendment No. 1 I should have said that I should like it to be grouped with Amendment No. 2. Therefore I should now like to refer to Amendment No. 2. This amendment is another attempt to probe the difference between proper practices and the power of the Secretary of State to specify accounting entries to the rate fund revenue account. The effect would be to make the Secretary of State specify entries of the rate fund revenue account only in accordance with proper practices. It negates the plan of the Government in wishing to override proper practices by the powers given under subsection (4) of Clause 2. But when would the Government wish to make a specification that was improper?
I hope that the Minister can give us some further explanation. We may have to come back to this matter later. There was a bit of an exchange at Second Reading between the Minister and my noble and learned friend Lord Silkin. I therefore hope that the Minister may be able to enlighten us further on this matter. I beg to move.
Lord Skelmersdale: This part of the Bill—namely, Clauses 1, 2 and 3—is designed to define relevant and total expenditure, by reference to the rate fund revenue account, which is made statutory for the first time. It is therefore a revenue account and not a capital one—something we will discuss further later on today. Clearly then it is important that local authorities should know in precise terms what items are to be treated as income to and expenditure from that account.
I suggest to the Committee that our lives would be made considerably easier if we could agree that this is both necessary and right. This belief of mine is given some validity by the fact that we have just agreed to

13
Clause 1 and Schedule 1. Unfortunately accountancy is an art which is constantly changing. The state of the art is defined by the use of proper practices which vary from time to time. However, it is important that the Secretary of State retains a power of direction and it is regarding this power of direction that the noble Baroness is principally questioning me.
These amendments seek to delete or modify the provisions in Clause 2(4) of the Bill relating to my right honourable friend's powers to make specifications that certain kinds of expenditure and income are to be regarded as of a revenue nature and hence are to be included in the rate fund revenue account unless they should be included in accounts referred to in Schedule 1 to the Bill or specified under Clause 1(6).
The purpose of these powers is to enable my right honourable friend to specify that some item of expenditure or income is of a revenue nature where there may be some doubt. In such circumstances it is our intention to make specifications so that authorities must compile their rate fund revenue accounts in the form of the non-statutory rate fund revenue accounts which authorities in general have kept in the past. This is necessary if we are to fulfil our prime objective of maintaining the status quo for the calculation of relevant and total expenditure which in the past has been calculated by reference to these same traditional non-statutory rate fund revenue accounts.
Given the purpose of these powers, we also need to provide, as in Clause 2(5), that the general requirement for authorities to comply with proper practices should be subject to any specification made under Clause 2(4). This is not so that we can turn generally accepted practices on their head but simply so that the specifications can be used in situations of doubt as to what is required by proper practices.
An example of where we might make a specification is as follows. All rate income is normally credited to the rate fund revenue accounts which authorities traditionally have kept, and we would wish to see this practice continued even though it might be argued that that part of rate income used to pay for capital expenditure is not of a revenue nature. In these circumstances a specification might be made for each year stating that all rate income is of a revenue nature.
At this point perhaps I should say something about proper practices, if that would be helpful to the Committee.
Baroness David: Yes.
Lord Skelmersdale: Local authorities prepare their accounts according to proper practices and their auditor is required to satisfy himself under the Local Government Finance Act 1982 that proper practices have been observed in the compilation of the accounts. These practices are not set out in statute and accountants and auditors—in particular the professional accountancy institutes—have developed, and indeed are continuing to develop, a body of accounting practices which are considered proper for local authority accounts. The Bill also does not specify precisely what the proper practices are. As I have already made clear, it is not our intention to interfere with local authority accounting. What Clause 2 of the Bill does is to provide that the practices to be applied
14
to the statutory rate fund revenue accounts are those applicable in 1986–87 to traditional non-statutory rate fund revenue accounts, but taking account of variations of practice occurring from time to time. And the clause also provides that on the key question of what is of a revenue nature there is a mechanism for dealing with situations where there is doubt.
Returning to the question of the specifications, if they had to be complied with only if they conformed with proper practices, this would mean that the specifications would be of doubtful effect in any situation where proper practices were unclear. But the very purpose of the specifications is to deal with situations where there may be some doubt as to what is required by proper practices. Making the specifications have effect only where they conform to proper practices would mean that the specification-making power could not be used in precisely those situations in which it is needed.
The powers we are seeking in Clause 2(4) are both appropriate and necessary, and I hope that with that explanation the noble Baroness will see fit to withdraw the amendment.
3.15 p.m.
Lord Silkin of Dulwich: The noble Lord the Minister has given an explanation of the necessity for specification. However, there remain two points which seem to me to be of importance as regards the drafting of Clause 2.
The first point is that under subsection (5) the provision is that subsection (1) is to have effect,
"subject to section 1(3) above and to any specification under subsection (4) above".
I do not know how those two interrelate. The subsection does not tell us which is to have predominance in case of conflict between the two. I should have thought that in any event a provision which made that clear is necessary.
Coming to the more directly relevant point regarding the amendments before the Committee, of course we accept that proper practices may involve a difference of view between one possibility and another. Accountants may differ as to which is to be preferred, while agreeing that both are proper practices. If that he so, then I should have thought that it would be perfectly reasonable for the Secretary of State to specify which of the two practices should apply. Surely the Secretary of State must accept that what he cannot do is to specify something which is an improper practice and which would not be classed as a proper practice at all; that is to say, where it is not a matter of comparing two proper practices and selecting the more appropriate one, but rather of specifying something which is not a proper practice at all.
The Minister did not deal with that possibility. No doubt the Secretary of State, as a matter of his own practice, would not specify something which he regarded as improper. However, the Bill as it now stands does not say that. The Bill as it now stands appears to give him the power to specify in such a way as to override proper practices and also in such a way as to specify that which is not a proper practice, notwithstanding that by doing so he may override proper practices.

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It is with that in mind that the second amendment has been put down, and the Minister has not really dealt with the fundamental basis for the amendment. I hope that he will either do so or accept that some change to the wording of this clause is necessary or desirable, even if he does not completely agree with the way in which we have done it.
Lord Skelmersdale: In looking after this Bill I want to be as accommodating as I possibly can be to noble Lords in all parts of the Committee. I take the point that the noble and learned Lord does not want my right honourable friend to specify what he calls an improper practice, yet another concept with which I suspect we shall have to grapple in a moment.
Before we get on to that point, as I hope we shall, the noble and learned Lord asked about the drafting of subsection (5) in lines 19 and 20:
"Subsection (1) above shall have effect"—
that is right: we have agreed that proper practices do exist, should exist and need to exist—
subject to section 1(3) above".
Clause 2(3) defines as closely as it is possible to define in this uncertain accountancy world what proper practices are:
"The practices are the proper practices applicable to accounts … kept by local authorities for the year beginning in 1986".
In other words, it is not accounts which may have varied in their make-up from 1981–82 onwards but we have defined a particular account on which to base the future regime,
"for the entry of items of the same kind as those falling to be entered in rate fund revenue accounts [which are set up by Clause 1], but taking into account variations of practice occurring from time to time",
a phenomenon with which the noble and learned Lord did not find a problem.
With regard to improper practices, at Second Reading I repeated what my honourable friend the Parliamentary Under-Secretary of State said; namely, that we have no intention of specifying something to be revenue which the whole world sees to be capital. The noble and learned Lord was not quite satisfied with that because he suggested that nonetheless we could still specify what he called improper practices. I take the point that the whole purpose of this Bill is to provide certainty for local authorities in their dealings with matters financial, both their own and those of central government intervention. I shall most certainly look at what the noble and learned Lord calls improper practices.
Baroness David: I thank the Minister for his explanations. As I said, this is a probing amendment because there is still a great deal of uncertainty about exactly what is meant. It is a complicated subject and I should certainly like to read what he has said.
I should also like to consult the local authority associations to find out whether they are satisfied. As the Minister has just said, what they want is certainty. That is what we should aim for. If they are satisfied with what he has said we shall probably also be satisfied. I reserve my right to come back to this matter
16
again at Report stage, but in the meantime I shall withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 2 not moved.]
Clause 2 agreed to.
Clause 3 [Meaning of local authorities' expenditure]:
On Question, Whether Clause 3 shall stand part of the Bill?
Baroness David: Clause 3 defines relevant and total expenditure, in Clause 3(1) and 3(7) respectively, and as such it is one of the clauses which should broadly be necessary in a Bill designed merely to correct the law. The other clauses are Clauses 1, 2 and 5 for England and Wales and Clauses 13 and 14 for Scotland. Very much more limited legal immunities would be required than those contained in Clauses 4 and 6.
The definitions are built on the structure of accounting set out in Clause 1. Relevant and total expenditure are included in the first instance by reference to debit and credit items charged to the rate fund revenue account with certain items being disregarded as accepted items. As such the definitions broadly endorse previous practice. However, we should like to raise certain questions in connection with the power of the Secretary of State to make adjustments to the accounts under Clause 3(7). This power was extended at the Committee stage in another place to include adjustments to relevant expenditure as well as total expenditure.
Under the Bill as published on 18th December there had been only a power to make adjustments in total expenditure. In moving the amendment at Committee stage to extend the power the Minister of State, Dr. Boyson, said that the wide power was necessary to exclude items entered contrary to proper practices and to exclude deficit financing of special funds. He stated that under the old system the DoE would have intended to exclude such items in the process of calculation. The new system was introducing formal specifications in such a case on which there would be consultation. Specifications would be introduced according to common principles.
We should like a word on how this would work. Can the Minister explain a little more about this? Will the local authorities have a proper opportunity to put their point of view? Will Parliament be alerted in any way before the Secretary of State can make specifications referred to in subsection (8) of this clause?
Lord Skelmersdale: This clause provides for 1987–88 and subsequent years a new method of calculating relevant and total expenditure by reference to the items of account debited or credited to the rate fund revenue account required by Clauses 1 and 2. The provisions of this clause are designed so that for these future years the method of calculating relevant and total expenditure will be broadly the same as that which has in practice been followed each year since 1981. This clause will enable us to fulfil our objective of maintaining the status quo on relevant and total expenditure.

17
The noble Baroness raised a particular problem over subsection (7). Perhaps I may introduce this by saying that subsections (6) and (7) are linked because they repeat the 1980 Act concepts and knit this Bill in with the current system. That is basically what they are there for. Subsection (7) provides that for the purposes of Part VI of the 1980 Act the total expenditure of a local authority in relation to any future year is the expenditure which is for those purposes the authority's relevant expenditure in relation to the year; first, reduced by the amount of any item of account which is credited to the authority's rate fund revenue account for the year and represents a relevant grant to the authority; and, secondly, adjusted by making such additions or subtractions or both as are specified in respect to the year concerned by the Secretary of State.
The noble Baroness also asked whether my right honourable friend the Secretary of State would "bounce" Parliament and local authorities in respect of specifications. I am advised that he must consult before acting.
Clause 3 agreed to.
Clause 4 [Validation for past and general provision for future]:
3.30 p.m.
Lord Silkin of Dulwich Lord Silkin of Dulwich moved Amendment No. 3:
Page 4, line 32, leave out subsection (1) and insert—
("(1) Insofar as the Secretary of State may before the passing of this Act have done anything in relation to any of the initial years or intermediate years for the purposes of the relevant provisions which

(a) consisted of or was dependent upon a calculation of total expenditure or of relevant expenditure; and

(b) if it had been done after the passing of this Act in relation to a future year, would by virtue of the provisions of this Act have been lawfully done,

it shall be deemed to have been done in compliance with those provisions.").
The noble and learned Lord said: With the leave of the Committee, I shall take with this amendment Amendments Nos. 6, 12, 14, 16 and 18. These amendments are necessary to remove what we see as a major constitutional blemish from the face of the Bill. The legislation is highly complex. Perhaps I should add that it does not contain a great deal of what is these days sometimes referred to as sex appeal. I cannot undertake to provide the latter but I shall try to define the issue as simply as possible.
Over many years the Secretary of State has erred in his interpretation of past legislation, so he comes now to Parliament asking it to do two things: first, to enable him in the future to continue as he did in the past but lawfully instead of unlawfully; and, secondly, to regard his past unlawful acts as though they were lawful. We say that this second objective should be permitted but no more widely than the first. The Secretary of State says that Parliament should give a very wide effect to the second objective. In order to do that he has framed what I can only describe as a catch-all formula in Clauses 4(1) and 6(2).
In my speech on Second Reading I said:
"Retrospective legislation is always regrettable but is at times a necessary evil. At least it should be a plainly limited evil. If even potential ambiguity can be removed, it should be removed".—[official Report, 10/2/87; col. 585.]
The noble and learned Lord, Lord Denning, and I both criticised the width of the retrospective provisions in this Bill in indemnifying the Secretary of State. I said:
"As a matter of constitutional practice this House should insist, in the absence of the very strongest reasons to the contrary, that all retrospective legislation is specific and related to clearly defined errors".—[col. 584.]
There has been no dispute on that principle up to now. So how has it been followed in the Bill? The noble and learned Lord endorsed the comments of four eminent academics whom the noble and learned Lord quoted as saying:
"The breadth of protection afforded by this Bill is unprecedented, unnecessary and is contrary to the basic principles of executive accountability under law".—[col. 581.]
Therefore we have two criticisms of the retrospective provisions in the Bill: first, they are unnecessarily and unconstitutionally wide and, secondly, they are ambiguous in that there is no clear and specific limit to their retrospection.
To bear that out, let us first define the retrospection required by reference to the declared objective of the legislation. It is found in the first paragraph of the Explanatory and Financial Memorandum, which states:
"Relevant expenditure and total expenditure, which are essential elements of the rate support grant and rate limitation systems in England and Wales, have been calculated in a way which conflicts with the legislation concerned … The Bill is designed to deal with the situation which has thus arisen".
There one has a clearly defined objective.
We now examine the wording of the subsection concerned to see whether those criticisms which have been made are justified. Clause 4(1) reads:
"Anything done by the Secretary of State before the passing of this Act for the purposes of the relevant provisions in relation to any of the initial years or intermediate years shall be deemed to have been done in compliance with those provisions".
The relevant provisions are set out in subsection (2)—mainly Part VI of the 1980 Act but there are a number of sections in other legislation which are similar. As can be seen, they go quite widely into the fields of education and elsewhere.
That covers the initial and intermediate years. Clause 6(2) is in similar terms and covers the financial years beginning 1985 and 1986. Neither of those subsections expressly limits their retrospective operation either to the calculation of relevant and total expenditure or to the specific actions which, unlawful in the past, the Bill will make lawful in the future. In each case it is,
"Anything done … for the purposes"
of a wide range of legislation.
Anything so done, though unlawful, is to be deemed to have been done in compliance with that legislation. Therefore on the face of the Bill there is no limit to the retrospective indemnification so long as what is done is done for the purposes of the legislation. By the use of that language the Bill seeks to rule out any legal challenge, whatever its basis may be, for the actions of the Secretary of State in respect of any rate support grant decision since the year 1981–82 and any rate limitation decision since the year 1985–86, that being dealt with by Clause 6.
Therefore on the face of the Bill it is irrelevant whether those decisions relate or do not relate to the calculation of total or relevant expenditure. Immediately, therefore, we must put this inquiry. If all legal challenge is ruled out, what possible justification is there for that? However, if we are told that that is not what the subsections mean and that they mean something different from what appears on the face of the Bill, then what do they mean, what are the limitations and why are the subsections in such apparently wide terms?
Both in another place and here on Second Reading we sought to find out from the Government why this very wide and at best ambiguous language has been used. We have not sought to oppose the Bill in principle. We accept the need for it. However, we say that it should not go too far and we seek no more than to limit its retrospective width to what is really necessary and no more than that. There has been no clear explanation. In fact, there have been two quite contradictory explanations.
The first, given by the Secretary of State on 19th January last, was that the wording is sufficiently tight to exclude that which is extraneous. The Secretary of State said:
"if the matter is totally extraneous to total expenditure and is about something totally different like multipliers, which are not affected, it will be possible for the court to continue to determine the issue just as it is possible for a court to decide that I was not wearing a seat belt when I should have been".—[Official Report, Commons, 19/1/87; col. 644.]
Two days later the Secretary of State's seat belt seems to have become somewhat tangled because he then stated:
"total expenditure or relevant expenditure is endemic in all of the sections of those Acts that are quoted in the Bill. It is impossible to disentangle some parts of any conceivable court case from those parts that relate to total expenditure".—[col. 995.]
If that is so, one may ask: why not leave it to the courts to perform their normal task of disentangling what relates to total or relevant expenditure and what does not? Why should Parliament perform in advance what is the customary function of a court and so usurp the court's province? That second explanaton put forward by the Secretary of State is particularly striking. The very example given by him two days earlier of what would not be affected by the retrospection provisions being, as he put it, wholly extraneous to total expenditure, consisted of multipliers, and multipliers are calculated under Part VI of the 1980 Act, and so, on his second explanation, are not capable of being disentangled from total or relevant expenditure.
Under his first explanation one could go to the courts on a decision which related to multipliers; and under his second one could not. But multipliers are not the only matter. There are many other similar ones which arise under Part VI of the 1980 Act and the other provisions detailed in the subsections. Other provisions are equally capable of being disentangled from total or relevant expenditure. I can mention some of them: the Secretary of State's duty to consult local authority associations on certain matters; the determination of the aggregate amount of domestic rate relief grant; principles to be specified in the rate
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support grant report where the Secretary of State is required to set out the principles on which he is acting; the power of the Secretary of State to apply multipliers to the product of grant-related poundage and gross rateable value; the duty to frame guidance by reference to principles which are applicable to all authorities and not to discriminate between them. All those would apparently be covered by the immunity as the Bill now stands.
These examples will certainly not come as a surprise to the Government because the Opposition in another place specifically mentioned them. That is at col. 55 of Hansard. Unfortunately, the Secretary of State did not give any reply to the citing of those examples. However, in this House at Second Reading the Minister reiterated the Secretary of State's second explanation—and I am quoting from cols. 598 and 599 of Hansard for 10th February. He justified it by the argument that:
"Although the determination of the aggregate domestic rate relief grant is not in itself dependent on total or relevant expenditure, domestic rate relief grant is part of aggregate Exchequer grant, which the Secretary of State determines in the light of his view of relevant expenditure".
Although it is not dependent on it, it is part of a whole which consists of the aggregate Exchequer grant, and other parts of that whole are of course total and relevant expenditure.
What he appears to be saying is that if in order to calculate C, the Government have to add A to B, then if A is wrong—as is here conceded—then C also will be wrong. The Government's argument is that if you deem A to be right, you must necessarily deem both B and C to be right. That, in my view, is logic turned on its head.
The whole justification produced by the Minister (at col. 599 of Hansard) was:
"It is therefore quite wrong to suggest that these matters have nothing to do with total or relevant expenditures and therefore could be exempted from the validation proposed".
In saying that, he misunderstood and misstates arguments from this side. We do not say that these matters have nothing to do with total or relevant expenditure. Of course there is a connection. They have as much to do with it as, for example, the Secretary of State's view of the future economic situation, future interest rates, and so on, which may affect his final decision on the grant. The courts are entirely familiar with the tasks of disentangling the relevant error from the irrelevant error. It would be wholly undesirable and unjust if, because the Secretary of State has made relevant errors for which the statute pardons him, he should therefore be pardoned for irrelevant errors of which Parliament was wholly unaware when it passed the legislation—and that merely because in reaching his ultimate conclusion the Secretary of State erred not once but twice or more.
The purpose of these amendments—for which as the Committee sees I have distinguished cross-party support—is to disentangle what the Bill is about from what it is not about. It narrows down the retrospection to that with which the Bill is intended to deal, that which consisted of, or was dependent upon, a calculation of total or relevant expenditure such as to bring it fairly and clearly within the ambit of the Bill's provisions. It will then be for the courts, if it be

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necessary, to disentangle the unlawful which the Bill makes lawful from that which it does not.
The amendment I put forward as having the merits of certainty and clarity avoids improper words and ambiguity. Even if the Government think—wrongly, in my view—that it is not strictly necessary for reasons which they may explain, the amendment cannot possibly weaken the objective of the legislation. Indeed, I shall be wholly satisfied if the Minister says: "We think this is unnecessary, but it can do no harm and on that basis the Government accept it". I beg to move.
3.45 p.m.
Lord Denning: I should like to support this amendment. It raises an important constitutional question. The Government have undoubtedly made mistakes over the past five years. They made the first mistake when they passed the 1980 Act in which they purported to define the words "total expenditure" and "revenue expenditure".
To show what a mess they got into, I will read the definitions of those two sentences in the 1980 Act. I hope the Committee can follow Section 56(8). It is just the draftsmen again:
"'Total expenditure', in relation to each such authority, means the expenditure which is relevant expenditure within the meaning of subsection (5) of section 54 above reduced by the amount of any grant to them mentioned in subsection (2) of that section and adjusted by the addition or subtraction of such descriptions of expenditure or receipts as the Secretary of State may direct".
That is the definition of total expenditure. I am sure the Committee are no wiser!
Then I shall go to the next sentence. They refer back to Section 54(5):
"in this section 'relevant expenditure', in relation to any year, means the expenditure for that year falling to be defrayed out of the rate fund of a local authority—

(i) reduced by the amount of any payments of such descriptions as the Secretary of State may specify which fall to be made for that year into the rate fund; and

(ii) exclusive of the items of expenditure mentioned in subsection (6) below"

I have read those sentences in full so as to show they are completely incomprehensible. They are typical of our modern form of legislation. Thank goodness that when we get to this new amending Bill, the provision which we have passed already makes it clear. It says by definition what is to be included and what is to be excluded, specifying the items. That is infinitely better.
Let me tell you what happened as a result of the clauses in the 1980 Act. The Government put a wide interpretation on them but the local authority associations said that the Government had got it wrong, that such meaning was never intended and that there ought to be a narrower interpretation of those clauses. The Government replied, "Yes, you are right after all. We will proceed in the way you want things done and follow the method by which local government associations make up their accounts because we were wrong". So the Government gave in and adopted the viewpoint of the local authorities. The accounts were improperly prepared in the sense that they were not in accord with the statute; they were properly prepared in the sense that they were what the local authorities wanted.
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What were the Government to do about it, since they had made that mistake all the way through? They had to admit that they had made a mistake and had done the calculation in a way that conflicted with the relevant legislation. So they admit the mistake and say, "This Bill is designed to deal with the situation that has thus arisen". They do not confine the remedy to the mistake which was the calculation that they agreed was wrong. They do not confine it to that. In Clause 4(1) they intend to give themselves a blank cheque, saying that anything that the Secretary of State has done wrong shall not be regarded as wrong but shall be regarded as right. Clause 4(1) reads:
"Anything done by the Secretary of State before the passing of this Act for the purposes of the relevant provisions … shall be deemed to have been done in compliance with those provisions".
That means that it has been deemed to be done wrongly.
The provisions of Part VI of the 1980 Act cover 20 sections (Sections 48 to 68) and take up 18 pages of the statutes at large. Under these provisions the Secretary of State is entitled to do many things. He may determine this, he may order that, or he may say what is the grant. There are 101 powers in those 20 sections of the 1980 Act. The present clause proposes that anything done by the Secretary of State in pursuance or in purportive pursuance of those provisions shall be lawful. In other words, effectively the Secretary of State is saying, "Not only do we want to correct. that mistake that I made but I may also have made lots of other mistakes and we want Parliament to say that it does not matter. Furthermore, we do not want the courts to be able to say that it is wrong". That is the effect of subsection (3).
Over 20 sections of an Act of Parliament that declare what the Secretary of State can or cannot do, the Secretary of State is trying to establish a right to say, "I may have done many things wrong but Parliament says that they are deemed to be right. Parliament says that should the courts go into those matters and affirm that they do not like them, it does not matter what the courts say and they must be deemed to be right anyway".
For that reason I say that this measure is unconstitutional. The Government are asking Parliament to validate wrongful acts committed by the Secretary of State contrary to the law. I do not mind them invalidating the particular mistake that has been made—that is why the amendment has been put down—in so far as he has done wrong in regard to a calculation of total expenditure and so forth. That can be put right. Let the specific mistake be remedied. However, I object—and I hope that the Committee will object—to the Government giving the Secretary of State a blank cheque so that he can say, "What I have done under all those provisions" (and there are 20 sections of the relevant part of the Act covering 18 pages of the statute enabling him to do no end of things) "is lawful and is not for the courts to inquire into".
The Government are putting the Executive and the Secretary of State above the law. They are asking the Committee to put the Secretary of State before the law and to say that anything that the Secretary of State can do is to be regarded as lawful even when he has done it wrong. That is why I say there is an important

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constitutional matter involved. The amendment seeks to provide that we do not validate the 101 actions that the Secretary of State has in his power to perform but only to validate the one admitted mistake that has been made and to put it right. Therefore I support the amendment and, as a matter of principle, the last four or five amendments in this group.
Lord Lloyd of Hampstead: I should like to add my support for this amendment. Unfortunately I was not able to be present at the Second Reading of this Bill, but having read Hansard I saw the reference made by the noble and learned Lord, Lord Denning, to the letter that he had received from four distinguished academics in matters of law. In that letter they pointed out that the way in which this clause attempted to exonerate the Minister from unfortunate mistakes was, as they described it, constitutionally offensive. I agree with the trenchant judgment and acknowledge the admirable way in which the noble and learned Lord has developed that argument.
Of course one recognises that such mistakes arise. I think that it is very unfortunate, as the noble and learned Lord, Lord Denning, has just pointed out, that we seem to find it impossible to improve the general way in which drafting is carried out, notwithstanding the conclusions of the excellent Renton report which tried to teach some useful lessons about how we could improve it. Despite that, we still carry on in the same way, which is a very unfortunate state of affairs. Nevertheless, one recognises that mistakes are made and it is not unreasonable to ask that legislation be passed to exonerate Ministers from the unfortunate consequences.
It is true that this process involves retrospection. But retrospection in such administrative matters is generally regarded as acceptable. Indeed, we do not have any constitutional provision concerning retrospection because of course we do not have a written constitution. However, it is not like an attempt retrospectively to create a new criminal offence whereby people may be held guilty of a criminal offence when at the time they committed the act in question no such offence existed. That is objectionable in virtually every conceivable circumstance.
The present kind of retrospection is not so objectionable but it is subject to some constitutional conventions. It is not unconstitutional in the strict sense because we have no written constitution and so do not have the notion that provisions can be struck down because they are contrary to some parts of it. Nevertheless, "unconstitutional" has a recognised and very important meaning. It means that there are certain established conventions which should be adhered to strictly. Certainly one of those conventions which I think would be universally recognised is that where such unfortunate errors occur and not unnaturally the Government wish to secure their position, the remedy must be carried out on a very narrow front. The precise mischief that has arisen must be specified and legislation must be precisely directed toward correcting that error.
In the present case, unfortunately, the Government have taken the unusual course of trying to give themselves carte blanche for every conceivable error that may have arisen during the years that this
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legislation has manifestly been misinterpreted. Such a blanket is highly objectionable. Moreover, it is unnecessary because, as has been pointed out by the noble and learned Lord, Lord Silkin of Dulwich, the matter can be dealt with by suitable amendments. He has put forward amendments which enable that unfortunate situation to be corrected without covering the Minister with a mantle of total innocence for every conceivable mistake that may have arisen under a long series of complicated provisions in the original legislation. There is a strong case for the Committee to be invited not to accede to this blanket protection but, on the contrary, to specify it as narrowly as it can reasonably be specified.
I confess that I have attempted to understand the various explanations and justifications put forward by the Government as to why they have chosen this unusual course. So far as one can see, what their justifications amount to is that at the back of their mind they have an apprehension that various things, which they cannot at the moment anticipate, may arise and unless they express the protection in the widest possible terms, they may find themselves in the ignominious position of having to return to Parliament to ask for still further protection. That is naturally a course that they do not wish to contemplate.
With all respect, that is not good enough. It is up to the Minister, having come along contritely in a white sheet to say, "We have made these mistakes, and we ask Parliament to put them right", to state specifically what difficulties have arisen and ask Parliament to give the Government protection in regard to those specific matters and no others.
I endorse the view expressed in the letter to which the noble and learned Lord, Lord Denning, referred, that this procedure is constitutionally offensive. It flies in the face of established convention. It should not be supported by the Committee. As a convenient and satisfactory alternative has been put forward by the noble alnd learned Lord, Lord Silkin, and his colleagues, there seems to be an overwhelming case for the Committee to endorse the amendments rather than to accept what is, after all, a rather, if I may say so, shoddy expedient which is being pressed upon the Committee by the Government.
4 p.m.
Lord Campbell of Alloway: May I say a brief word in opposition to the amendment? I listened with great care to what the noble and learned Lord, Lord Silkin of Dulwich, said. It seems to me that the objection to the amendment, if he will allow me to say so, is that it inevitably leads to litigation. The merit of the government drafting is that it avoids that. Everyone accepts that there has been something of a muddle over the past five years. No one has understood the drafting. There is nothing unusual about that, but five years is rather a long time not to understand drafting.
It is said that the circumstances are wholly exceptional. It is dangerous to say circumstances are wholly exceptional. I accept that the Government will have to justify "anything" in Clause 4(1), but in a way it is justified in part by what the noble and learned Lord, Lord Denning, said. He has been through Part VI of the 1980 Act. He rightly says that the Secretary of State can do many many things. It is not possible

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practically to disentangle what is or what is not extraneous to total or relevant expenditure. It is accepted by the noble and learned Lord, Lord Silkin, that the matter should be left to the courts.
With the greatest respect to the Committee, I question that. I should have thought that the Government's approach is broadly right in an unfortunate and regrettable situation. It is, cry a halt to litigation.
Lord Foot: I intervene in this discussion with some hesitation on various counts, one of which is that I am totally ignorant of the mysteries of local government finance. But the debate on this amendment raises a matter which I think is within my comprehension and which is something that all Members of the Committee can comprehend and make a useful judgment upon. In one way what we are discussing today is the meaning of words. What do the words mean?
I suspect that there is agreement on all sides of the Committee upon certain aspects of this matter. They are ones to which the noble and learned Lord, Lord Silkin, referred. Firstly, I think it will be agreed that the Government are, with this Bill, introducing legislation to correct mistakes which were previously made. Secondly, there is probably no serious disagreement on the proposition that occasionally (this is one of those cases) retrospective legislation is necessary to cure an error.
The third matter upon which I hope there is agreement on all sides of the Committee is that such legislation is always regrettable. But if that is right, it follows that there are two corollaries to the proposition. The first is, as the noble and learned Lord, Lord Silkin, made plain, that the legislation should be not drawn more widely than is necessary to cure the error. The second, which I think follows from the belief that such retrospective legislation is always regrettable, is that the legislation should not inhibit or circumscribe the authority of the courts, except in so far as it is strictly necessary to cure the error which has been made.
I suspect, and indeed the Government made it clear on Second Reading, that they take the view that this Bill and this part of the Bill conform with those propositions and requirements. The opponents of the Bill and this part of the Bill say that they offend against both those propositions. The Government say that it is neither the intention nor the effect of the Bill so to offend. Who is right about that? The discussion is largely about the meaning of words.
Two observations therefore seem to be proper. The first is: why should we accept from the Government that this legislation is proper and right? Why should we accept from the Government that their interpretation is right when it was their misunderstanding of the earlier legislation that made the Bill necessary? Their judgment of the meaning of the words of this Bill is suspect on that account.
There is another good reason for believing that on this occasion the Government have it wrong. That is the matter to which both the noble and learned Lords, Lord Silkin and Lord Denning, have referred. If one looks at the declared purposes of the Bill in the
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Explanatory and Financial Memorandum, one finds what the object of it is. If one then looks at the amendment moved by the noble and learned Lord, Lord Silkin, one finds that the effect of it is precisely to accord with the Government's declared object of the Bill; whereas if one looks at the clauses as they are now drawn by the Government, it is perfectly clear—it was put beyond any doubt by what was said by the noble and learned Lord, Lord Denning—that the terms of this Bill go far wider than the requirements of putting the original error right.
Therefore, we are faced with the very odd situation that, when we come to divide the Committee, one of the issues will be what these words mean. Are we right on this side of the Committee in thinking that they go far too wide or are they within the limits of what is proper in the retrospective legislation, as the Government contend?
Will it not be very strange that we go into the Lobbies to decide not so much a constitutional issue—although there is a very big constitutional issue here—but to a very large extent what is the meaning of the words? I contend that it has been overwhelmingly explained that the words mean what the amendment of noble and learned Lord, Lord Silkin, says. Therefore, I think I am right in saying that the proposition of the noble and learned Lord will receive the overwhelming support of those on whose behalf I speak.
Lord Monk Bretton: My noble friend Lord Campbell of Alloway was quite right when he raised the important point that we do not want a great deal of legal difficulty arising from now on because of this mistake. However, I know there are those in local government of the same political persuasion as myself who are concerned that there may be extra powers in this Bill that should not be useable retrospectively upon the audited accounts of individual authorities. It is that worry and that worry alone which concerns me. If that is unlikely to happen, I am much more content with the Bill as it is than I should be otherwise.
4.15 p.m.
Lord Bancroft: I shall be brief though not quite as brief as the noble Lord who preceded me. I rise to support this amendment in the context of the connected amendments which the noble and learned Lord, Lord Silkin, mentioned when he introduced the debate. It has always struck me as something of a whimsical irony that this should be one of the most centralising administrations of all in my experience. The gap between the rhetoric and the practice can be greeted by shocked horror, as it frequently is—which I think is entirely inappropriate—or by a degree of courteous derision. Temperamentally I find the latter more acceptable.
I pass over in silence, as is only proper at this stage of the Bill, what has been done to the health service, what has been done to the central machinery of government and what has been done to the education service, whether the curriculum or the pay and conditions of teachers. I concentrate instead on this amendment in relation to local government.
In my view, it is an exaggeration, although a pardonable exaggeration, to say that the heart has

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been torn out of local government and buried somewhere in Marsham Street. In each case the Government have started out from a perfectly legitimate and understandable point. In local government there was the legitimate wish to curtail the extreme capers of some local councils, but it ended up with leaving the capital city without even a small elected government to oversee a narrow range of activity. It also ended up by giving central government unlimited powers—reserve powers, I accept—to cap the expenditure of every local authority in the land.
We have a similar feature here. What started off as a perfectly understandable and acceptable wish to correct a legal flaw has ended up as a tote bag of blanket powers for the Secretary of State and his officials. To watch this Administration, who are putting into practice what are in many ways the splendid Tory ideals of decentralisation, is rather like watching a toddler trying to plough a 10-acre field with a spoon and pusher. I think that this amendment is right in confining itself to correcting the specific mischief and not going wider. For that reason I support it.
Lord Bellwin: Let me pick up one or two points on what the noble Lord, Lord Bancroft, said when he rather took us away from the subject by his references to local government generally. Many of us on this side of the Committee, and I suspect even on the other side, would disagree very strongly with him on a number of things he said. For example, he referred to the Government having taken powers to cap rates on every authority in the land. It should be put on record that every authority in the land does not have its rates capped; it is only those that choose to spend far beyond what is reasonable. Indeed, the people who have to pay the rates and taxes within those authorities are thankful that there is such a measure.
One hesitates to enter into a debate with so many noble and learned Lords who quote so much of the legal side of a complex subject. Indeed, I should probably know that more than most, having been involved in the introduction of the 1980 legislation. I had to smile when the noble and learned Lord, Lord Denning, read out the definitions which were called for in the Act. Nevertheless, this has always been a complex matter.
When we talk of relevant expenditure and—the new term now to come in—revenue rate expenditure, aggregate exchequer grants and all the other terms, I am sure that most Members of the Committee wonder what on earth this is all about. That is understandable; it has always been a complicated matter. As I have said in this Chamber in the past, whenever one sets out to divide some £12 billion, £13 billion, £14 billion or £15 billion of money among some 430 or so authorities to take into account their respective needs and resources, it is bound to be a formula which will turn upon judgment and many different factors. It will never be simple and easy.
However, that is not the issue today. I do not see the issue, as does the noble Lord, Lord Foot, as a matter of interpretation alone. It is certainly that, but to me the issue is the simpler one of whether we stick to the narrow definition or go for the wider one which the
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Government prefer. What is the right thing to do? No one disputes that this has to be put right. If it were necessary to go into the reasons why it needs to be put right I should want to say much more. I suspect that it is not necessary; I therefore do not want to take up time in doing so. Should the definition be wider? Should the courts decide if we leave it too narrow. In many debates in this Chamber I have heard it said that we should try not to leave issues to the courts to decide, but should try so far as possible to cover such matters by legislation on the face of the Bill. That must be right wherever possible.
I am not without sympathy for the points that the noble and learned Lord, Lord Silkin, made so very ably. On a personal note perhaps I may say it is the first time that I have had the pleasure of listening to him in the Chamber. While I did not agree with everything he said, I hope I shall hear him on many more occasions. However, on balance I feel that the Bill should provide for the wider interpretation. I understand and recognise its shortcomings and the concern of those who feel otherwise. But I am bound to say, thinking as seriously as I can about a complex subject which is difficult for all of us, that on balance I very much hope that the Government will stick to their position and not accede to the amendment. I shall listen with much interest to what the Minister says.
Baroness Gardner of Parkes: I wish to oppose this amendment and support the Government mainly because of the report of the General Purposes Committee of the London Boroughs Association, which has considered this Bill quite carefully. The association expresses a number of concerns. In particular it is worried that in trying to control the bad people in local government one may damage the good ones. However, the sentence I wish to read to the Committee is from the association's minutes and I think it is highly relevant. It reads:
"In expressing the Association's concern we have urged the Secretary of State to be mindful of the uncertainty that might be created, and have asked him to use his anticipative powers with that in mind".
I consider that that is what this whole debate is about: whether the Government should make the provisions wider and use these anticipative powers. The London boroughs are certainly hoping that the Government will do that. The original Bill supports that view but the amendment does not.
Lord Skelmersdale: No one who has read the papers over the last few weeks can fail to be aware that Clause 4(1), Clause 4(6) and Clause 6, which deal with the validation of past decisions on rate support grant and rate limitation have given rise to much misunderstanding, confusion and criticism. I observe that the noble and learned Lord, Lord Silkin, called this a major consitutional blemish; and the noble Lord, Lord Lloyd of Hampstead, followed that view, and said that it was constitutionally offensive.
This subject of validation is a very difficult area indeed. I believe that all noble Lords who have spoken have made that point. On the one hand the Government obviously do not want to validate more than is absolutely necessary. On the other hand the law must be as clear and effective as possible. We all heard the speech that my noble friend Lady Gardner of

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Parkes has just made. In spite of what the noble and learned Lord, Lord Silkin, said, nothing can be clearer than the word "anything" which appears not only in the Bill but in his own amendment. Unfortunately, the noble and learned Lord is clearly rather embarrassed by it because he backs away from it as fast as he decently can only two lines later.
All these amendments in one way or another seek to modify the provisions of the Bill relating to the validation of anything done before the passing of the Bill for the purposes of the provisions specified in Clause 4(2)—provisions dealing with rate support grants. In passing, I hope that I am right in my understanding that we are dealing not only with Amendment No. 3 but also with Amendments Nos. 6, 12, 14, 16 and 18.
Lord Silkin of Dulwich: Yes.
4.30 p.m.
Lord Skelmersdale: I am grateful for that confirmation. The Government did not produce this Bill lightheartedly or overnight. Each subsection was crawled over for days. Indeed, this crawling over was the reason for the Statement that I repeated last week which caused a certain amount of angst from the noble Baroness, Lady David. At an early stage in drafting the Bill we considered very carefully provisions that were not dissimilar to the amendments which we are debating today. However, for reasons to which I shall come in a moment, we decided that they simply would not do. I believe that what we have in the Bill is absolutely necessary to cover what needs to be validated properly. This is in the interests of all local authorities; and that is a statement which I now have to seek to prove to the Committee.
Amendments Nos. 3 and 14 go to the heart of the validation provisions. As I said, at an early stage in the preparation of the legislation this approach was considered carefully, but after a full examination we concluded that it did not achieve our objectives for a number of important reasons. First, there is the question whether all the matters which need to be validated are matters which consist of or were dependent upon a calculation of total expenditure or relevant expenditure.
The noble and learned Lord, Lord Silkin, had great fun commenting on what he said were two distinct explanations by my right honourable friend the Secretary of State in another place suggesting that he has confused the issue. This was miles away from his intention. My right honourable friend was particularly concerned in his second Statement to build on the words of his first Statement on 19th January. The previous words did not cover the whole position. His subsequent words did. I shall therefore have to have another go.
No one regrets more than I do the complexity of our local government finance legislation. However, a rate support grant report contains literally a myriad of decisions. The way in which these decisions are reached involves at some stage or another total expenditure or relevant expenditure considerations. however, the statutory provisions do not in all cases make express reference to those concepts. For example, grant related expenditures are figures of total expenditure and the principles for grant related
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expenditure have reflected the narrow interpretation of the rate fund revenue account. The relevant statutory provisons make no reference to total expenditure. The calculation of multipliers for certain purposes takes into account an authority's total expenditure, but again the relevant statutory provisions here do not refer to total expenditure.
Our view is that not all the matters which need to be validated consist of or depend upon total expenditure of relevant expenditure. In many cases there would be considerable room for legal argument as to whether a particular decision consisted of or was dependent upon a calculation of total or relevant expenditure.
Do Members of the Committee consider that the grant related expenditure principles consist of or depend on such a calculation? The principles for grant related expenditure depend on the interpretation of the rate fund which has been accepted in the past. Some of the components relate specifically to that interpretation: for example the grant related expenditure for contributions to special and capital funds. Under the wide interpretation of the rate fund such contributions are nothing more than internal transfers within the rate fund. Similarly the grant related expenditure component for the financing of capital expenditure incurred since 1981/82 has assessed all such financing costs, including the costs of financing internal loans; for example from a balance on the rate fund revenue account or from capital funds. Under the wide interpretation of the rate fund, these internal capital charges would not count as expenditure.
Does the Committee consider that the determination of the amount available for grants depends on a calculation of total or relevant expenditure? Under Section 54(4) of the 1980 Act my right honourable friend must take into account the latest information available to him as to the rate of relevant expenditure before determining the amount available for grant. What about close-ending adjustments under Section 62 of the 1980 Act? What about multipliers for the purpose now under Section 2(2) of the Rate Support Grants Act 1986?
We cannot afford for there to be any doubt whatsover over these important matters. It must be clear what we intend to validate. The amendment proposed would leave all the questions on these important matters unanswered. We do not want to provide a fertile field for litigation. My noble friend Lord Campbell of Alloway made this point very strongly and was backed up by my noble friend Lord Monk Bretton.
Another reason why the amendments do not work is that they validate things done only if they would by virtue of the provisions of the Bill have been lawfully done if they had been done after the passing of the Bill in relation to a future year. This ignores the fact that the Bill does not provide a complete definition of relevant and total expenditure for future years.
What the Bill does is to provide definitions with powers for my right honourable friend to specify adjustments. Under the 1980 Act there were also provisions for specifications under Section 54(5) in relation to relevant expenditure and directions under

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Section 56(8) in relation to total expenditure. Specifications and directions were made each year, usually in the rate support grant report for the year. The specifications and directions made for each year reflected different circumstances in that year.
The result has been that the definitions of relative and total expenditure have never been precisely the same in each year. Nor have they been the same as the provisions of the Bill provide for future years, as these provisions envisage specifications being made. All this means that none of the calculations of relevant and total expenditure in the past will have complied with the provisions of the Bill alone for the future. In short the amendment would mean that nothing was validated.
A general point has been raised in relation to the width of the validation provisions in Clause 4, and I assume by implication that this point also covers Clause 6. It has been suggested that the executive is putting itself above the law of the land. As I explained, this is simply not the case. If this Bill becomes an Act it will be the law of the land. Parliament and not the executive will have decided what the law of the land should be; the executive will have to comply with it and the courts will interpret it in the same way as any other Bill. The noble and learned Lord, Lord Denning, is quite right when he says that the Government have put a narrow interpretation on the matter in accordance with local authority wishes.
It has also been suggested that the Bill's provisions give a blanket indemnity to my right honourable friend. I have explained why it is absolutely necessary that the validating provisions should be as they are and why the amendments put forward do not cover them. These provisions deal only with decisions taken before the passing of the Bill. All future decisions will be reviewable by the courts in the normal way. Therefore it is not right to claim that the Bill takes away any obligation of my right honourable friend to remain accountable to law. This is why I dispute the suggestion that this is a constitutional outrage.
These provisions must be clear. As I said with reference to the last group of amendments, the Bill attempts to provide clarity and certainty. On the admission of the noble and learned Lord, Lord Silkin, the amendments would leave the position in certain circumstances to be determined by the courts. I must ask the Committee whether that provides the certainty for local authorities that is required. I suggest that the answer is no.
My noble friend Lord Campbell of Alloway was absolutely right when he took the view that such an approach would provide a fertile ground for legal argument as to whether a particular decision was consequent upon or depended upon such calculations. Under Part VI of the 1980 Act the Secretary of State has to take many individual decisions under the relevant statutory provisions. In many cases those provisions do not expressly refer to relevant or total expenditure but in one way or another they depend on the definition of total expenditure.
For example, although the duty of the Secretary of State to consult the local authority associations is not itself dependent upon total or relevant expenditure, he
32
has consulted annually on proposals based on an erroneous calculation of total and relevant expenditure. To avoid arguments of the kind I have described, we concluded that it would be more satisfactory to validate clearly anything done for the purposes of relevant statutory provisions relating to rate support grant and anything done for the purposes of Part I of the Rates Act 1984.
I regret to say that these amendments provide only half the cure. In the light of this I urge the Committee to reject the amendments. They would be very much against the true interests of local government.
Lord Silkin of Dulwich: I have listened with a little surprise to the distinguished noble Lord, Lord Campbell of Alloway, deprecating the idea of asking the courts to decide those matters which customarily come before the courts; that is to say, matters which fall within the legislation and matters which fall outside the legislation. I listened with growing amazement to the explanation given by the Minister. It seemed very much to turn on its head the basic principles which I thought the Committee was considering.
The Minister told the Committee that the words "anything done" are clear and definite and at the same time that they are sufficiently wide to encompass anything which has a connection with the subject matter of this legislation. Therefore local authorities and others that may be affected by the actions of the Secretary of State would be deterred from litigation. I understand the Government's desire not to have more litigation than is strictly necessary. Without wishing to make a party point, this desire follows very much from the course of such litigation over the past few years which undoubtedly has embarrassed the Government.
That is not to say that wide wording should be deliberately used. Clearly, from what the Minister has said in this case it has been deliberately used. He told us how amendments which were somewhat similar to the amendment which I have moved were considered and rejected, and in the end this very wide wording was accepted. It does not mean that very wide words should be used where it is possible to define clearly what is intended.
Why can we not define clearly what is intended? As I understood it from what the Minister told the Committee, it is because, even though the Bill is about total and relevant expenditure, those terms are not terms of art which can be clearly expressed in legislation. In fact, they are expressed in Clause 3, which tells us what the terms mean specifically. It is difficult to see, therefore, why in Clause 4 a definition of what can properly be validated by reference to those very terms should be matters to which exception should be taken.
What I also found extremely difficult to follow was the Minister's explanation of the history of this matter, beginning with what he described as crawling over the drafting, the Secretary of State then giving an explanation to the other place of the reasons for this formulation, which he found it necessary—I think was the expression used—to build upon two days later. One would have thought that if the wording had been

33
so carefully considered and the possible alternatives rejected for good reason, that would have been clearly shown to Parliament as soon as the matter was raised, if not indeed before.
When we come to the explanation today it departs even from the explanation given on Second Reading. It may be that the Minister believes himself to be building upon what he said. What he is now saying is that in order to avoid possible future litigation let us draw the indemnification widely enough to cover anything that may possibly be connected with the subject matter of this legislation, whatever the basis for it.
He cites as his instances of why that ought to be done a number of matters to which we have referred as matters which are plainly not within the terms of consisting of, or being dependent upon, a total or relevant expenditure. The noble Lord is quite bold about it, saying that certainly those matters are not part of total or relevant expenditure, nor do they depend upon total or relevant expenditure. Nevertheless they are all part of some enormous whole which may include both them and the definition of total and relevant expenditure, and so to avoid possible future litigation let us regard them as being validated, and so on.
Lord Skelmersdale: I am grateful to the noble and learned Lord for giving way. Having heard what he has just said, of course the bottom line of all this is the validating reports that have been made by my right honourable friends since 1981–82 and laid before another place. One cannot validate a report without validating the decisions that led up to the making of that report. It is this about which we are arguing. These, as the noble and learned Lord has himself just said, do not necessarily depend on the previously described total and relevant expenditure. Therefore one must, by definition, have a wide validatory provision, and that is what is found in the Bill.
Lord Silkin of Dulwich: Now we are going round in circles. My argument, and that of those noble and learned Lords and noble Lords, who support my amendment, is precisely the point that the Minister is making. There are many matters which are within the wording of the relevant provisions which are divorced from—which are not calculations of or dependent upon—relevant and total expenditure. Because they are separate, and because it is only total or relevant expenditure with which this Bill deals, they should not be validated if there were errors made by the Secretary of State relating to them. The Minister is saying that for that very reason they should be validated.
The issue between us is clear. I hope that the Committee will take the view—this is clearly a matter that must be put to the decision of the Committee—that it is highly desirable, whether the exact words of my amendment are accepted or not, that the words of the Bill should be narrowed down to no more than is absolutely essential. I stand upon that principle, and I ask the Committee to support it.
4.45 p.m.
On Question, Whether the said amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 119; Not-Contents 123

DIVISION NO. 1

CONTENTS

Addington, L.

Kilmarnock, L.

Airedale, L.

Kinloss, Ly.

Amherst, E.

Kirkwood, L.

Ardwick, L.

Lawrence, L.

Attlee, E.

Listowel, E.

Ayleslone, L.

Llewelyn-Davies of Hastoe, B

Bancroft, L.

Lloyd of Hampstead, L.

Banks, L.

Lloyd of Kilgerran, L.

Beaumont of Whitley, L.

Lockwood, B.

Bernstein, L.

Longford, E.

Beswick, L.

Lovell-Davis, L.

Birk, B.

McGregor of Durris, L.

Blyth, L.

McIntosh of Haringey, L.

Bonham-Carter, L.

Mackie of Benshie, L.

Bottomley, L.

McNair, L.

Briginshaw, L.

Mitford, L.

Broadbridge, L.

Milner of Leeds, L.

Brockway, L.

Molloy, L.

Brooks of Tremorfa, L.

Morton of Shuna, L.

Bruce of Donington, L.

Munster, E.

Burton of Coventry, B.

Murray of Epping Forest, L.

Campbell of Eskan, L.

Nicol, B.

Carmichael of Kelvingrove, L.

Ogmore, L.

Cledwyn of Penrhos, L.

Phillips, B.

Collison, L.

Pitt of Hampstead, L.

David, B.

Ponsonby of Shulbrede, L. [Teller.]

Dean of Beswick, L.

Denning, L.

Porritt, L.

Diamond, L.

Prys-Davies, L.

Donaldson of Kingsbridge, L.

Rathcreedan, L.

Dowding, L.

Ritchie of Dundee, L.

Elwyn-Jones, L.

Robson of Kiddington, B.

Ennals, L.

Rochester, L.

Ewart-Biggs, B.

Ross of Marnock, L.

Falkender, B.

Seear, B.

Falkland, V.

Serota, B.

Fisher of Rednal, B.

Shannon, E.

Flowers, L.

Shaughnessy, L.

Foot, L.

Shepherd, L.

Gallacher, L.

Silkin of Dulwich, L.

Gladwyn, L.

Simon of Glaisdale, L.

Graham of Edmonton, L.

Somers, L.

Greenway, L.

Stedman, B.

Grey, E.

Stewart of Fulham, L.

Hampton, L.

Strabolgi, L.

Hanworth, V.

Taylor of Blackburn, L.

Harris of Greenwich, L.

Taylor of Gryfe, L.

Hayter, L.

Tavlor of Mansfield, L.

Hirshfield, L.

Tordoff, L. [Teller.]

Hooson, L.

Underhill, L.

Houghton of Sowerby, L.

Wallace of Coslany, L.

Howie of Troon, L.

White, B.

Hughes, L.

Wigoder, L.

Hunt, L.

Williams of Elvel, L.

Hutchinson of Lullington, L.

Wilson of Rievaulx, L.

Hylton-Foster, B.

Winchilsea and Nottingham, E.

Ilchester, E.

Jeger, B.

Winterbottom, L.

Jenkins of Putney, L.

Young of Darlington, L.

John-Mackie, L.

Ypres, E.

Kennet, L.

NOT CONTENTS

Alexander of Tunis, E.

Biddulph, L.

Allerton, L.

Birdwood, L.

Auckland, L.

Blake, L.

Bauer, L.

Boardman, L.

Beaverbrook, L.

Boyd-Carpenter, L.

Belhaven and Stenton, L.

Brabazon of Tara, L.

Bellwin, L.

Brougham and Vaux, L

Beloff, L.

Broxbourne, L.

Belstead, L.

Bruce-Gardyne, L.

35

Butterworth, L.

Luke, L.

Buxton of Alsa, L.

Lyell, L.

Byron, L.

Malmesbury, E.

Caithness, E.

Margadale, L.

Cameron of Lochbroom, L.

Marley, L.

Campbell of Alloway, L.

Marsh, L.

Campbell of Croy, L.

Marshall of Leeds, L.

Carnock, L.

Maude of Stratford-upon-Avon, L.

Clitheroe, L.

Cottesloe, L.

Merrivale, L.

Cowley, E.

Mersey, V.

Craigavon, V.

Milverton, L.

Crawford and Balcarres, E.

Monk Bretton, L.

Cromartie, E.

Morris, L.

Cross, V.

Murton of Lindisfarne, L.

Cullen of Ashbourne, L.

Newall, L.

Davidson, V. [Teller.]

Nugent of Guildford, L.

De La Warr, E.

Orkney, E.

Denham, L. [Teller.]

Orr-Ewing, L.

Derwent, L.

Pender, L.

Dilhorne, V.

Plummer of St Marylebone, L.

Drumalbyn, L.

Dundee, E.

Portland, D.

Elibank, L.

Rankeillour, L.

Ellenborough, L.

Rodney, L.

Elles, B.

Rollo, L.

Elliot of Harwood, B.

St. Davids, V.

Elliott of Morpeth, L.

Saltoun of Abernethy, Ly.

Erroll of Hale, L.

Sandford, L.

Faithfull, B.

Sempill, Ly.

Ferrier, L.

Skelmersdale, L.

Fortescue, E.

Strange, B.

Fraser of Kilmorack, L.

Strathcarron, L.

Gainford, L.

Strathspey, L.

Gardner of Parkes, B.

Sudeley, L.

Gormanston, V.

Suffield, L.

Gray of Contin, L.

Swansea, L.

Gridley, L.

Swinton, E.

Haig, E.

Teviot, L.

Hanson, L.

Thomas of Swynnerton, L.

Harmar-Nicholls, L.

Thorneycroft, L.

Hesketh, L.

Tranmire, L.

Hives, L.

Trefgarne, L.

Holderness, L.

Trenchard, V.

Home of the Hirsel, L.

Trumpington, B.

Hooper, B.

Vickers, B.

Kaberry of Adel, L.

Vivian, L.

Kimball, L.

Ward of Witley, V.

Kinnaird, L.

Whitelaw, V.

Lane-Fox, B.

Wolfson, L.

Lauderdale, E.

Wynford, L.

Layton, L.

Young, B.

Long, V.

Young of Graffham, L.

Lothian, M.

Resolved in the negative, and amendment disagreed to accordingly.
4.55 p.m.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 4:
Page 4, line 40, leave out ("Conclusive block grant calculations") and insert ("Any basic block grant calculation").
The noble Lord said: I trust that it will be convenient to the Committee if I speak also to Amendment No. 5 at the same time. These are both technical amendments to Clause 4(3) and, for the avoidance of doubt, I use the word "technical" in the narrow and not in the wide sense which other noble Lords would probably apply to the whole Bill.
The amendments are to make clear that when we make the conclusive calculations for the block grant for 1981–82 and 1982–83 for England and Wales and also for 1983–84 for Wales we take account of the education pooling adjustment in the way we were intending and in the way that local authorities expect. I commend the amendments to the Committee. I beg to move.
Baroness David: I should like to thank the noble Lord the Minister for having had the kindness to send me letters about the amendments which were put down. That was extremely helpful, but I have to comment about the number of government amendments, including several lengthy amendments to Schedule 3.
We do not want to oppose this amendment. We agree that it is technical, but I think we have a right to complain about the number of minor technical amendments, as the Minister describes them, which have been made and the increasingly complex and fragmented nature of the law relating to local government finance. It does not make it very easy for those having to operate the system if the changes are made, even at this very late stage. These amendments were put down only at the end of last week and the Bill has been in print since 18th December. While we accept the amendments, we want to protest that they have been tabled as late as this.
Lord Skelmersdale: Nobody is more aware than I of the complexity of local government finance. At least I can say that it is a good deal less complex since 1980 than it was when the party of the noble Baroness was in power.
Noble Lords: Oh no!
Lord Skelmersdale: It was so complex then that there was not a computer in this country to do the calculations and they had to go by satellite every time to Columbus, Ohio. That is what I call real complication.
Having said that, inevitably I must regretfully confess that a number of amendments have been put down late, right at the end of last week, because in our constant crawling over the existing legislation we have discovered that it is necessary to refer in this Bill to that legislation although originally we were unaware of that. I can only apologise to the Committee that this is so. While recognising that we shall reach other government amendments, which I think I am right in saying consist of only four blocks of which this is one, I am grateful to the noble Baroness for her reception of Amendments Nos. 4 and 5.
On Question, amendment agreed to.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 5:
Page 5, line 1, leave out from ("a") to end of line 3 and insert ("basic block grant calculation is a calculation made for the purposes of section 66(2) of the 1980 Act of an amount of block grant payable, without taking account of section 63 of and Schedule 10 to that Act (education adjustments).").
On Question, amendment agreed to.
The Deputy Chairman of Committees (The Earl of Listowel): Before I call Amendment No. 6 I must point out to the Committee that if this amendment is agreed to I cannot call Amendments Nos. 7, 8 and 9.
[Amendment No. 6 not moved.]
Baroness Robson of Kiddington Baroness Robson of Kiddington moved Amendment No. 7:
Page 5, line 13, leave out ("whether").
The noble Baroness said: At the same time I should like to speak also to Amendments Nos. 8, 18 and 19.
I am hopeful that the Government will consider this a very reasonable amendment. In the debates on the Bill, both at Second Reading and earlier this afternoon in debating Amendment No. 3, great concern was expressed on all sides of the Committee about the legal position of the Secretary of State and the fact that he cannot, in our view, be challenged in a court of law.
I know that the noble Lord, Lord Skelmersdale, said in reply to the debate on Amendment No. 3 that future decisions in court can be challenged. However, if we read Clause 4(6) we see that it says:
"Subsection (I) above shall have effect notwithstanding any decision of a court (whether before or after the passing of this Act) purporting to have a contrary effect."
What this amendment wishes to do is to remove the word "whether", and Amendment No. 8 seeks to remove the words "or after". In my view, that would still leave the Bill in the way that the Government wish to have it.
Clause 4 validates all past decisions by the Secretary of State in respect of the calculation of rate support grant and in respect of the calculation of expenditure limits and rate limits. But Amendment No. 7 puts on the face of the Bill the right of the courts to make decisions in the future about the Secretary of State's calculation of rate support grant. This amendment would allow authorities to take actions for judicial review of ministerial actions to court after the enactment of the Bill. I hope that the Government will feel this is an amendment to which they can agree. I beg to move.
5 p.m.
Lord Denning: I should like to support this amendment. It seems to me plain that after the passing of this Act the courts will go by the whole of the provisions and then our new subsection, as it will be, subsection (4), will come in. After the Act is passed the courts will decide according to the Act as passed. It seems to me quite wrong that this clause should in effect say that a decision is wrong after the Act has been passed. It is quite all right to take a decision before the Act is passed, but not after. Therefore I should like to support the amendment.
Baroness David: I should like to add my support. We have already expressed our anxiety about the blank cheque which is being given to the Government by this subsection. This is another effort by a different method from that of my noble friends to try to get this changed. I should like to support the noble Baroness.
Lord Skelmersdale: It is quite clear that the Government know what they want to achieve but it is not so clear that the rest of the Committee either agree with what they want to achieve or indeed are going to allow us to do so.
These amendments seek to modify the validation provisions of the Bill, one of which we have just accepted, relating both to rate support grant and to rate limitation. They would mean that we would no longer be able to cater for the eventuality where a court case was heard before the passing of the Bill and decided on the existing statute but judgment is handed down after the passing of the Bill. The possibility of
38
such a situation is slim but any Bill must cater for even the most remote of eventualities.
The effect of the amendments would be that in a situation of the type I have mentioned the matters which were the subject of the court decision would not be validated. This defeats the very purpose of the Bill, which is to validate without doubt past decisions relating to rate support grant and rate limitation. In other words, the offending words to which the noble Baroness, Lady Robson, refers in Clause 4(6)—the ones in brackets—
"(whether before or after the passing of this Act)"
are for cases in the pipeline. I should also make the point that this Bill is concerned only in this validation respect with decisions of my right honourable friend taken before the Bill gets on to the statute book. Therefore I am not sure whether the noble Baroness's worries still pertain.
Lord Silkin of Dulwich: Before the Minister sits down, he seems to he saying that the words "or after" are necessary. Perhaps he could confirm that the Government are saying that. Why should they be necessary? The noble and learned Lord, Lord Denning, said quite explicitly and in my view rightly that after the passing of the Act it is the provisions of the Act which will have effect. You do not need to say a second time that they will have effect whether the litigation started before or after the passing of the Act, even if after the passing of the Act the court makes a decision which conflicts with the law. Why does the Minister say the words are necessary?
Lord Denning: May I add just a word? As it stands, it is not confined to cases which are in the pipeline: it applies to any cases after the passing of this Act, and so if it is going to be confined to the pipeline cases it ought to be put in a different way.
Lord Skelmersdale: I accept the point made by the noble and learned Lord, Lord Silkin, that after the passing of this Act it will become the law. That is quite natural and normal. But let us take a court case which is entered into today. By the very nature of things it is going to take three weeks or so for this Bill to get on to the statute book. It is quite likely, knowing the speed of the courts—and the noble and learned Lord will know of this much better than I do—that a decision handed down will not be given until after the passing of this Act although that decision will have been made on the position under the existing legislation. Therefore this is something else that quite clearly the Bill needs to validate, and the draftsman has chosen this particular way in which to validate it.
I shall have to study carefully in the Official Report what the noble and learned Lord has just said. There may be different words to express the intention of what I have just spoken about, in which case the Government will naturally consider the matter very carefully.
Lord Denning: I am glad to hear that, because clearly this is far wider than cases in the pipeline. In the case the Minister put forward, the court was actually hearing a case and was about to give judgment. Immediately after this Act is passed it ought to be

39
brought to the attention of the court. I suggest that the clause be reconsidered so that it can be confined solely to cases in the pipeline.
Baroness Robson of Kiddington: In view of the Minister's reply, and particularly his last words, I think that the wording as it stands at the moment, at least to a layman, is dubious. I should be very grateful if the Government would think about rewording that clause; and in the expectation that they will, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 8 not moved.]
Baroness David Baroness David moved Amendment No. 9:
Page 5, line 14, at end insert ("after the laying before Parliament of a report by the Secretary of State setting out the effects of the operation of this subsection in relation to that decision").
The noble Baroness said: The purpose of this amendment is to enable Parliament to be made aware of the implications of subsection (6) at the time when it operates to override a court decision. The amendment would require a report to be made by the Secretary of State at the time when Clause 4 operated to override a court decision; that is, at the time of that decision. The report would not prevent the decision being overridden but it would enable Parliament to be made aware of the implications of the clause on each occasion that it took effect.
Clause 4 validates retrospectively anything done by the Secretary of State before the passing of the Act in relation to rate support grant from 1981–82 to 1986–87. Any decision of a court on these matters shall have no effect where they purport to have contrary effect to the purpose of the clause. The exclusion covers decisions made both after and before the passing of the Bill, as we have just been discussing.
At the time that a court's decision is given in favour of the plaintiff and then is taken to have no effect, the amendment would require a report to be laid explaining what had happened. In practice, the plaintiff would be likely to be local authorities or ratepayers who had sought to challenge an aspect of the Secretary of State's actions on rate support grant other than any decisions connected with definitions of total and relevant expenditure. Assuming that a court was willing to hear the case, in view of the exclusion of decisions from having effect, the decision would be valid where it upheld the Government but excluded from having effect where it did not.
There is some doubt as to whether cases could continue to be brought against rate support grant decisions by the Secretary of State for the years concerned after Royal assent. The Bill does not preclude the courts having jurisdiction but denies their decisions having effect where those decisions run counter to the Bill. There seems to be an element of farce in this, in that the authorities, or whoever it is, can take their case to court but the possibility of having a decision in their favour is no good because it can be overruled.
The operation of the legal exclusions in respect of Clause 6 has meant that the challenge brought by the London Borough of Greenwich against the Secretary
40
of State has effectively been frozen by the Bill's publication; and your Lordships will hear more of this when we come later to Amendment No. 21. Where Parliament is so exercised about the powers that the Secretary of State is taking to himself—and it has been clear from the speeches this afternoon that a great many of us all round the Committee are exercised—it seems reasonable that a report should be available so that everyone can be aware of what is happening and how the Act is working. I beg to move.
Lord Skelmersdale: I am grateful to the noble Baroness for explaining the amendment so clearly, but, as I said in my intervention towards the end of the winding-up speech of the noble and learned Lord, Lord Silkin, in the second block of amendments which we considered this afternoon, all we are interested in validating are those reports which have already been made and those decisions leading up to making those reports. There is a whole list, which I think I am right in saying I gave on Second Reading, as to what still has to be done which will not be covered by this Bill.
It may or may not help the Committee if I read out that list. The future decisions on rate support grant relating to current and past years are as follows. For 1981–82 and 1982–83 we still need to make conclusive calculations of authorities' block grant entitlement; for 1983–84 it is intended to make one further supplementary report and thereafter the conclusive calculations; for 1984–85 it is intended to make one further supplementary report and thereafter the conclusive calculations; for 1985–86 it is intended to make a supplementary report immediately after Royal Assent to this Bill, a further supplementary report sometime later and thereafter the conclusive calculations; for 1986–87. it is intended to make a supplementary report immediately after Royal Assent to this Bill, a supplementary report early in 1987–88, two further supplementary reports and thereafter the conclusive calculations. None of these things will be touched by this Bill.
What it is important for everybody to realise, and realise clearly and with certainty, is what is and what is not validated. To that extent I agree with the noble Baroness. It may be wholly unclear at any time to what extent the provisions of Clause 4(1) have effect under this amendment. To ascertain this an investigation would need to be made of all relevant court decisions, of whether reports or orders had been made and of what would be the position if the order was prayed against. The complications, I suggest, simply do not bear thinking about.
I hate to use the expression—I cannot for the life of me at this moment think of another one—but at the end of the day no purpose would be served if things done before the passing of this Bill were not validated at certain times. I understand the objective of the noble Baroness in having a report laid before both Houses of Parliament—to provide absolute certainty. But the way she has chosen does not provide that certainty. Perhaps if she and I can get together before the next stage of the Bill—
Noble Lords: Oh!
Lord Skelmersdale: If the offer is going to be refused, then the offer will be refused. As I was saying,

41
it' the noble Baroness and I can get together on this matter, perhaps with our advisers, we may achieve an end result with which we are all happy. But at the moment I am afraid that I must advise her that this is not the way ahead.
5.15 p.m.
Baroness David: I thank the Minister. He has it wrong if he thinks we were pouring scorn on what he was saying. It is a surprise and a pleasure when there is an offer of co-operation and another look at something.
This amendment comes at the end of subsection (6) of Clause 4, and so it applies to court decisions and not to the laying before Parliament of the supplementary reports which the Minister quoted at Second Reading and quoted again from col. 598 of Hansard for 10th February. I hope he will remember what I have just said about the amendment being to the subsection which deals with court decisions. But I shall be very happy indeed to have a talk with him and his advisers in the hope that we can produce something at Report stage which will satisfy everybody. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 4, as amended, shall stand part of the Bill?
Lord Silkin of Dulwich: As I said in my speech on the amendments, this is an extremely important clause. The provisions relating to validation are outstandingly important. They are, in particular, in subsections (1) and (6) of the clause read together. As a result of the other amendments that have been moved, the Minister has been good enough to agree to look again at some of the wording, and so we are in the position that this clause generally will be yet again reviewed or crawled over, to use the Minister's own term.
I hope that in the process of crawling the Minister and the Secretary of State will give emphasis to the discussion which we had on the amendments to subsection (1) and indeed to the very narrowness of the decision of the Committee upon it. It is clear that the Committee was evenly divided. I know that one is enough and in this case it was four times one, but four out of a total of some 240 is within the permissible margin of error, in terms that are frequently used these days on other matters.
At any rate, apart from statistics I hope that the Secretary of State will recognise the considerable force of the arguments that were put forward by very distinguished Members of the Committee from every quarter expressing their anxiety about subsection (1), and will look at it again on the basis that, even if the Government have reservations about my attempt to narrow down the issue; that subsection can be narrowed down and put into language which will plainly explain to local authorities what it is that is validated, as to which there is no need for them to go to law—they will not be successful if they do—and what is not validated.
In the course of his replies to a number of amendments, not only that one but others, the Minister gave a much clearer indication than we have
42
had in the past of the matters which in his view would be validated and those which would not; those which would fall within the subsection and those which would not. It occurs to me that that would be extremely helpful. I do not say that we should regard it as satisfying our anxieties. However, it would go some way towards satisfying them and it would be helpful to the local authorities if the Government were to put down a new schedule which specifically set out those matters either one way, the other way or both ways. The matters I refer to are specifically those which they would regard as coming within the words "anything done" and those which would not. At least local authorities would then have the plain words of the statute and an itemised list of matters. They would not have to go to counsel every time a dispute arose to ask whether a matter fell within the deeming provisions of subsection (1). I hope that the Minister will consider those matters with his right honourable friend.
I now turn to subsection (6), concerning which the Minister promised to look at the wording again. I see no necessity for any wording that refers to decisions made after the passing of the Act. It seems to me that if a court makes a decision after the passing of the Act even in relation to litigation which began before the passing of the Act—litigation in the pipeline, as it was put—a court would be compelled to have regard to what the law was at the moment before the decision was made by the court. The court would therefore automatically be wrong if it made a decision, albeit based on what it conceived to be the law previous to the passing of the Act, which was in conflict with the Act. I therefore hope that the Minister's consideration of that subsection will be wider than that which he has promised.
I shall also go further to say that I did not move Amendment No. 6, which I asked the Committee to take together with the amendments which I did move and the corresponding amendments to Clause 6. However, I ask the Minister to look at the wording, as it seems to me that subsection (6) as it stands is really the wrong way round. We have a provision in subsection (1) that certain things are deemed to have been done in compliance with the provisions of the legislation. When we come to subsection (6) we are told that subsection (1) shall,
"have effect notwithstanding any decision of a court (whether before or after the passing of this Act) purporting to have a contrary effect".
Why should that be necessary? That which the Act says shall be deemed to have been done, shall be deemed to have been done. It does not seem necessary to repeat that it shall still be deemed to have been done even if a court has made some earlier or later decision.
Perhaps the reality of the matter is that what we are concerned about is making it clear that a decision of a court, which may be rightly made before the passing of the Act or wrongly made after the passing of the Act, will have no effect after the passing of the Act. That is why Amendment No. 6, which I did not move, was put in precisely those terms. I ask the Minister to look at that matter.
I am not asking for a decision on any of these matters now. However, I am asking the Minister to look at the suggestions which we think might mean considerable improvement and the removal of

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uncertainty in the legislation. It is with that that we are all concerned, because we are not objecting to the principle of the legislation.
Lord Denning: Having expressed anxieties about Clause 4, which will no doubt pass the Committee stage, it seems to me that by careful drafting most of those anxieties could be removed and Clause 4 could be made acceptable. At the moment I retain the view that it is too wide. However, I hope that by Report stage it can be put in terms which are acceptable to everyone.
Lord Skelmersdale: I should not call it a vain hope. However, it is a very wide hope. What I actually promised to do was to look at two particular amendments and the speeches made by noble Lords regarding them.
The first matters for consideration were Amendments Nos. 7 and 8 and, by reference, Amendments Nos. 19 and 20 on the rate-capping side. Those refer to Clause 4(6) and in preparation for this debate I looked at the very point which the noble and learned Lord, Lord Silkin, has just raised. He raised the matter of the word "purporting" in Clause 4(6) and also in Clause 6(4). In those provisions the draftsman was addressing a problem which is a real and difficult one which my advisers describe as "semantic". I had always felt that there was a slight undertone of rudeness in describing arguments as semantic. Apparently I was wrong, as I often am.
Any decision of a court given after the enactment of the Bill would not have a contrary effect, although it might be delivered in terms of previous law, which is the point which the noble and learned Lord has just raised. Accordingly, I am advised that the word "purporting" is apt to describe the legal position. However, I readily accept that this is a matter upon which there is plenty of scope for argument, and I shall look at what the noble and learned Lord has said.
What the noble and learned Lord has just said shows that I was quite right to offer the noble Baroness and perhaps the noble and learned Lord himself a joint colloquy as to the exact nature of the validation provisions which we are now seeking in Clause 4. I am grateful to the noble and learned Lord, Lord Denning, for saying that he is sure that an acceptable solution will be found. Therefore, I think at this stage I can do nothing more than to ask the Committee to allow Clause 4 to stand part of the Bill.
Clause 4, as amended, agreed to.
Clause 5 [Further provision as to future]:
Baroness David Baroness David moved Amendment No. 10:
Page 5, line 41, at end insert ("and the Secretary of State shall pay compensation to local authorities for any additional expenditure incurred or expenditure rendered abortive by them as a consequence of the provisions of this section.").
The noble Baroness said: The purpose of this amendment is to require the Secretary of State to compensate the local authorities for the effects of the Bill in relation to accounting procedures. It is intended to highlight the question of the extent to which the Government are to blame for the difficulties caused to local authorities by the Bill.
Clause 5 retrospectively applies the definitions of total and relevant expenditure to the intermediate years, 1983–84 up to 1986–87. That includes the power of the Secretary of State to introduce adjustments in respect of particular authorities. In those circumstances, authorities could face additional costs arising from variations in accounting practices applied retrospectively up to four years afterwards.
While costs in terms of staff time or otherwise may not be substantial in most cases, they could be substantial in some cases and there is the question of principle, given that the Bill in no way arises from error by local authorities or still less by ratepayers. The question has now been resolved as to why the Government's initial legislation on block grant (which is the 1980 Act) failed to take proper account of a legal issue which has now arisen.
It is true that the Government somewhat reluctantly agreed to adopt the interpretation preferred by local authorites and that doubts existed at the outset about its correctness. It remains unclear why the definition adopted was not clearly set out, if necessary in amendment legislation. In that sense the Govenment have been prepared to take risks with this aspect of local Government finance for several years; and it is ultimately their responsibility.
After all, we have had plenty of Bills concerning local government finance since 1980. Even when the error was discovered last September the Government did not move with haste. Another month or so passed before the Attorney-General confirmed the initial legal view, and it was 16th December before the Secretary of State admitted the existence of the error. This was despite several meetings with local authorities at which the then current redetermination applications were discussed, and there were opportunities in the Commons, including a Private Notice Question from my honourable friend Dr. Cunningham, to clarify what was happening with the overdue block grant settlement.
When the Bill finally appeared, it went far beyond the limited claims made as to its purposes. The complexity and contentious nature mean that it is still before Parliament and is even now being used by the Government as their pretext for dropping the privatisation proposals. We do not mind so much about that. They are doing so because of the complexity of the Bill and the drafting of the Bill which from the debates we have had already this afternoon still seem so totally unsatisfactory. In the meantime authorities have been left in a state of uncertainty with their accounting practices as much as four years in arrears. The amendment seeks to place the moral responsibility and any financial cost for the situation on the Government. I beg to move.
5.30 p.m.
Lord Denning: I support the amendment by going back to our civil law. It has been the case for the past 20 years or so that if a person negligently gives advice which is erroneous, or negligently makes a statement which is erroneous on which another person acts to his deteriment, then he can recover damages in respect of that negligence. I am afraid that the Government have made a statute—and some people would say it was

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negligence—which is erroneous and has to be corrected; and local authority associations have done important work in correcting, as they were bound to do, the errors of the Government. On the principles of civil law, they ought to be compensated for the expense to which they have been put. That is the civil law. I do not say that it applies to our statute law; but, on the other hand, is there not a good moral case for this amendment to be accepted?
Lord Skelmersdale: In answering this amendment, perhaps I may make the general point that in my experience the law is rather like the mills of God: it grinds exceedingly slowly. I do not think that the noble Baroness should be surprised that lawyers have taken so long to make up their minds on the exact formulation that has been produced in this Bill.
Reverting now, after that very interesting Second Reading speech of the noble Baroness, to the amendment in question, I have to advise her that it contravenes Clause 15 of the Bill, which as I understand the point is by way of being a money resolution clause. Clause 15 states:
"There shall he paid out of money provided by Parliament any increase attributable to this Act in the sums payable out of money"—
and this is the point—
"so provided under any other Act".
In other words, as I read it and assuming that my advice is correct, if money was paid out under the 1980 and 1982 Acts which are directly relevant to this Bill, it is cricket to continue paying them out, albeit in a slightly altered form. But what the noble Baroness is proposing here is an increase, or rather a different form of payment, which is in none of the previous Acts relevant to rate support grant. Therefore, because of the money resolution, I am advised that this is slightly improper as an amendment. I have been trying to check up on this point; but, regretfully, I have not totally succeeded. However, that is what I understand the position to be.
Baroness David: I was lucky enough to meet the Minister after lunch before we came into the Chamber and he warned me that this would be his reaction to the amendment. I had time to look up Clause 15. My understanding of the clause is that it prevents this Bill from increasing grant payable under other legislation such as the Local Government, Planning and Land Act 1980. The last words of Clause 15 say,
"Out of money so provided under any other Act".
However, this amendment is designed to provide for a small amount of grant to be payable under this Bill, not under any other Act.
My second point is that I have looked up the Notes on Clauses and I can find no guidance whatsoever on Clause 15. Perhaps I may read out Clause 15 as it appears in the Bill:
"There shall be paid out of money provided by Parliament any increase attributable to this Act in the sums payable out of money so provided under any other Act".
I went to the Notes on Clauses for guidance and found that all they say about Clause 15 is this:
"This clause provides that there is to be paid out of money provided by Parliament any increase attributable to the provisions of the Bill in the sums payable out of money provided by Parliament under any other Act".
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The Notes on Clauses merely repeat the words of the clause and so that is not particularly helpful.
We put forward the amendment to test the principle. If the Government object to the drafting, we shall be happy to take it away and bring back another amendment at Report. However, it is, as the noble and learned Lord, Lord Denning, said, really a matter of moral responsibility. The Government have let local authorities in for this because they were willing earlier to accept the wrong interpretation of the 1980 Act. We feel that the wretched local authorities should have some form of compensation.
Lord Skelmersdale: Did I detect a certain sharpness in those last words of the noble Baroness, Lady David?
Lord Graham of Edmonton: I hope so.
Lord Skelmersdale: The noble Lord, Lord Graham, says that he hopes so. If I may be sharp in return, I do not recall that when the Clay Cross position was validated by the last Labour Government, any issue of compensation to local authorities was even thought of or considered by the party opposite, Therefore I do not think that compensation, which as I understand it has never been used in this way for local government in the past, has any justification for the future; and, after all, the Explanatory Memorandum says that this will not cost extra money.
Lord Pitt of Hampstead: I cannot allow the Minister to get away with that one. As we understood it, the whole purpose of the 1980 Act was to control local government expenditure and the way in which rate support grant was determined. During several debates we have had on local government expenditure the Goverment have always claimed that they were trying to help the local ratepayer. On this occasion the local ratepayer is disadvantaged. The amendment is saying that if the local ratepayer has been disadvantaged, he should be compensated. I cannot understand why the Government cannot accept such a simple principle.
Lord Skelmersdale: The Government do not accept that the local ratepayer has been disadvantaged.
Lord Dean of Beswick: I should like to take up a point that the Minister has made. He said that the last Labour Government had validated the action of Clay Cross. What did he mean by that? My recollection is that there was very little if any validating. In fact the councillors involved paid the full penalty under the law as prescribed and some of them are still disqualified from holding public office.
Lord Skelmersdale: I have forgotten the name of the Act in question but I believe it was the "something or other" Housing Act 1974.
Lord Dean of Beswick: The Opposition are entitled to a fuller explanation than that. My information—and like the noble Lord the Minister I am speaking off the top of my head—is that there was no retrospective legislation passed to protect the Clay Cross people. As I said, some of them are still paying the penalty for what they did.
Lord Skelmersdale: I have now been provided with the title of the Act. It is the Housing Finance (Special Provisions) Act 1975. The whole purpose of that Act was retrospectively to relieve councils who were liable to financial penalties but had not yet been surcharged. That is why I referred to that Act.
Lord Silkin of Dulwich: I am glad that the Minister has now identified the legislation because I have more than once said that when I die that title will be found to be blazoned across my heart. The distinction between that legislation and the present Bill, from the point of view of the amendment, is that in relation to that legislation there was no advice by the Government which caused the local authorities concerned to act illegally. There is no analogy at all.
Rather against the Government's own will, because at first sight they thought that the law was otherwise, and presumably after taking such advice as local authorities would expect the Government to take in the circumstances, the Government said, "Right, local authority associations want to interpret the legislation in this way and we are prepared to interpret it in this way". Not unnaturally, the local authorities accepted that. I am quite certain that in those circumstances if I were a clerk to a local authority I would say to myself "Well, the Government did not like the idea to begin with but now they have accepted the view that we have taken. They must have obtained proper advice on the subject and formed the opinion that they are within the law in doing so. Therefore we ourselves, in so far as any action is called for by us, are entitled to rely on the advice that the Government have taken and the view on the law that the Government are putting forward".
However, it now appears six years later that unhappily the Government were wrong and that they misled the local authorities. Perhaps there had been no additional expenditure and no expenditure was rendered abortive, but all we say in this amendment is that if there had been then the Government, having put the local authorities in that position, ought to see that they and the ratepayers do not suffer as a result.
I must say that I was surprised when, in his first reply, the Minister did not raise the point of principle which he raised during his previous two or three replies but instead dealt with the matter on a basis which he himself might describe as semantic, by reference to Clause 15. I do not know whether or not Clause 15 is amendable. If it is not amendable—and I confess my ignorance of the rules of this place in that repect—even though we have not yet reached it the Minister may be right. I do not know. However, if it is amendable I do not follow the semantic argument. It is the question of principle which is important and I hope the Minister will accept what my noble friend said and the support he has been very properly given.
Lord Skelmersdale: As I sought to explain in what the noble and learned Lord deigned to call my semantic initial argument, I understand that the amendment is improper because of that clause in the Bill. I attempted, off the top of my head, to explain that there are no compensation provisions in existing legislation. Therefore because of Clause 15 if it is unamendable (I suspect we will not have a definitive
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ruling on that until tomorrow) and if I am right in what I said to the Committee—I have no reason to believe that I was wrong—Amendment No. 10 would fall because of Clause 15.
However, I am not, I hope, an unreasonable man and if it is necessary to come back to the Committee tomorrow and apologise, and even more necessary to debate this again on Report, I am totally in the hands of the Committee and would expect to do both those things.
Baroness David: We have moved perhaps a little further as we have debated this point. The Minister said—twice, I think—that he was talking from the top of his head. Therefore I hope he will make inquiries to be absolutely certain that he is correct in what he said. Of course we shall also take advice on exactly what Clause 15 means and whether it is possible to amend it and therefore make Amendment No. 10 possible. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.45 p.m.
Baroness Fisher of Rednal Baroness Fisher of Rednal moved Amendment No. 11:
Page 5, line 41, at end insert—
("( ) In the application by virtue of subsection (1) above of section 3 above in relation to an intermediate year, the Secretary of State shall not have power by virtue of subsection (1) or subsection (7) of that section to specify an adjustment to the relevant expenditure or total expenditure of a local authority by reference to an item of account being a debit or credit to any account of any fund established under paragraph 16 of Schedule 13 to the Local Government Act 1972 which has been approved by the auditors of the local authority.").
The noble Baroness said: Before I speak to this amendment, I am absolutely fascinated by the thought of the Minister crawling over the complexities of it. I wonder whether this is a new weekend leisure sport for Ministers.
Lord Skelmersdale: I did not say that I personally had crawled over it. I said that it had been crawled over, which is a different point, whether at the weekend or not.
Baroness Fisher of Rednal: Perhaps if the Minister himself had crawled a little it might not have been so complex. Perhaps the noble Lord will accept that as a bouquet for him.
When I spoke on Second Reading I said that my knowledge of local government finance would get me a C-minus. Since then, as the noble Lord may have noticed—or perhaps not—I have not been in the Chamber as often as usual. That has been for medical reasons, but it has given me an opportunity of doing a little more reading than I might otherwise have done. Local government finance has not been convalescence reading, by any stretch of the imagination. However, I think I now have some of it completely firmly in my mind. Clauses 1 and 2, where the Government describe the narrow basis for the interpretation of the general rate fund, are out of the way; and that is now clear in my mind. What was not clear previously was where the local authorities asked for the narrow basis and the Government initially thought that they needed

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a wider basis. We come back again to the phrase "narrow basis". It is complicated to understand. It might have been better if the Government had gone for the middle way and taken the middle lane when we would perhaps have had the best of both worlds.
However, understanding that and the fact that it takes place from 1st April 1987, I am now quite clear on relevant expenditure and total expenditure. The noble Lord, Lord Skelmersdale, has defined those clearly this afternoon. They must be the items in the account but also with the proviso that the Secretary of State can make amendments. Therefore I have those definitions firmly in my mind and no doubt the noble Lord the Minister will tell me if I am wrong.
When we come to the relevant expenditure I can see that point clearly and I hope I have that aspect right too: that the Government have this big cake that they intend to give out to local authorities. Local authorities of course think it is a very small cake. Nevertheless, there is this overall cake and so the total expenditure really is the slice of each part for each individual authority. I think I have that right.
Then the noble Lord, Lord Skelmersdale, talked about distributing the block grant. This means that individual authorities notify the Department of the Environment about the level of their budgets and then, as time goes on, about changes to the level of spending, ending with the final returns. What the Minister said was important. There are the conclusive entitlements to grants which have to be worked out some time after the year ends. It so happens that the noble Lord said that final conclusive calculations have only been valid for 1981–82 and 1982–83 for authorities in England. I do not know about Wales or Scotland; he did not make mention of those. Adjustments by way of supplementary rate support grants still remain to be made for other years.
I feel sure that noble Lords are not particularly interested in the rate support grant and that their conversation is perhaps a lot more interesting. Thank you! No doubt I do not speak loud enough! I can shout, of course!
Adjustments by way of supplementary rate support grants still remain to be made for other years. It is very easy for the Minister to say that, but all local authorities are concerned. They are in limbo. What we are talking about is not words on a piece of paper: it is finance. Finance to local authorities means money for services. One really needs to say to the Government that it is important that as soon as possible the adjustments by way of supplementary rate support grants are made. The Minister has assured us that they will be made but it would be interesting if he could tell us the actual date when they will be made so that local authorities will know how they have to plan within the next two years when they are looking long term.
Then we come on to Clause 5 of the Bill. I hope I have got this part of the Bill clear as well because to my mind this requires the new system of accounting to be applied to those years I have mentioned—1983–84, 1984–85, 1985–86 and 1986–87. Noble Lords will appreciate that many authorities have closed their books; they have had their books audited for those years. Therefore any change will mean that notional accounts will have to be created on the new basis
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because the system created by the Bill did not exist at the time. What a great difficulty that puts the local authorities in. It makes it more difficult to see whether they are getting all that they ought to get from the rate support grant.
In applying the new system to those years—the Bill calls them the intermediate years—the Secretary of State has indicated that he intends to use his new powers to take out of relevant and total expenditure so much of any contributions to special funds as exceeds any rate fund revenue account deficit for that year where that contribution does not relate to specific liabilities of the authority to third parties. He goes further than that. He is also going to deny those authorities which are concerned the benefit of using that contribution to reduce spending in later years.
The Minister talked about complexity. The wording of that letter denying the authorities the right to use their contributions to reduce spending in later years actually comes from the Department of the Environment itself. To clarify that, it sent out a letter on 16th December and had to send another letter on 18th December saying:
"I am afraid that the second sentence of the first paragraph was not properly addressed and should read".
If the matter is complex and if the department cannot even get the letters right, are we sure we are getting this Bill right? It is important.
We then find that the practice of using special funds—I am going to speak about Birmingham later because I know the Minister loves me to speak about my beloved Birmingham—as a means of smoothing out differences in grant entitlements from year to year is well known. The Department of the Environment is fully aware of it and has been for a long time. Local authorities use it. It is a well-known practice.
The particular complaint of the Secretary of State is that in the case of Birmingham—there are some other local authorities; I think there are 11 local authorities chiefly concerned, covering all political complexions, and even hung councils—they allowed their rate fund revenue account to go into deficit in order that this result might be achieved. This is not accepted by Birmingham. I hope the Minister will accept that local government revenue accounts are kept on a receipts and payments basis during the financial year but, unlike central government, year-end accounts are drawn up on an income and expenditure basis, including debtors and creditors. It follows that a year-end deficit does not automatically mean a cash deficit.
It was quite wrong in the debate which took place in the other place for the Secretary of State to say that Birmingham's fund contribution in 1984–85, equal to the rate fund deficit, did not exist. That is completely untrue. The circumstances surrounding the fund contribution were fully examined by that very well-known firm Price, Waterhouse, who are the auditors, and the Audit Commission itself. They see nothing illegal about it. In fact, in May of last year Price, Waterhouse actually notified the Department of the practice that Birmingham was operating. In the Second Reading debate in the other House the legality of Birmingham was not challenged by the Secretary of State. In fact, as I said on Second Reading his words were that there was nothing illegal.

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Therefore we find this great difficulty that has arisen. It is a great difficulty because the amount of money could be £8 million or £13½ million. What I am saying this afternoon so far as concerns Birmingham is that the Secretary of State has completely misunderstood the council's overall financial position in 1984–85 when there was a deficit on the rate fund. The council's overall cash position was not in deficit and it is wrong to suggest that the contribution made to the fund was somehow without real money.
As the noble Lord is no doubt aware, the subject was extensively discussed in the other place on 26th January. I refer him to cols. 67 to 83 of Hansard. The legal officers in Birmingham crawled all over the law. There were two different city treasurers. In fact, the first city treasurer left Birmingham to become what I believe is the highest paid treasurer in the country. He has gone to Kent, where perhaps they have a much better climate than in Birmingham, though I do not believe that people there can in any way be nicer. Some very eminent solicitors are employed by the city of Birmingham and no doubt the city treasurers are also eminent people. Moreover everybody knows that the chief executive officer of Birmingham is a man who for a long time has been working with the Association of Municipal Authorities.
There was nothing wrong with what they did. However, the powers in the Bill, and in Clause 5 in particular, bring into question the legality of Birmingham's actions. This measure is pure retrospection. The Secretary of State is giving himself powers to take away from the city a large amount of money which may come to between £8 million and £13½ million. I am aware that in the Department of the Environment a close study is being undertaken of this matter because of further information that has been sent to it arising from the Second Reading of this Bill in another place. I hope that this information will enable the Secretary of State to keep an open mind on the issue, as he said he would when he spoke during Second Reading, and to accept that Birmingham's fund contributions were properly made.
I have spoken primarily about Birmingham but I feel sincerely for all other local authorities which find themselves in the same predicament. It is not a case of bad accounting or a case of fiddling the books; it is a case of operating the Act as it was when they were given necessary powers that are now to be taken from them. I beg to move.
6 p.m.
Lord Dean of Beswick: I rise to join with my noble friend and colleague in support of this amendment. She has ranged fully through the purposes of the amendment. However, I was somewhat surprised when I heard the Minister say that my noble friend and colleague Lady David, who is leading for this side of the Chamber, had almost made a Second Reading speech. At least, reference was made to a Second Reading speech on a previous amendment.
The way in which the different clauses of this Bill are listed and the intentions of the Government in the Bill almost provoke Second Reading debates. For instance, earlier today a distinguished Cross-Bencher
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referred to centralisation by the Government and admitted to being rather surprised that a government of the colour of the present government should aim to carry out such a policy. There is no question but that this is happening in regard to this particular finance Bill. The rate support grant system will be that which the Secretary of State wishes it to be and no one will be able to alter it in any way whatsoever.
I shudder at the thought of what may happen sometime in the distant future when perhaps we have an elected government who are directly opposed to the aims of the present one and who have a more extreme way of thinking than many of us in this Chamber today. I wonder how they will use the powers that are asked for by the Secretary of State in this Bill. I think that they are very dictatorial powers indeed. In fact, one of the main purposes of the Bill is to deny local authorities the right to have recourse to the law as a final resort.
In this Chamber during debates, at Question Time and when discussing Bills such as this one there is continual reference to local authorities, and one would think that we were talking about a group of people who act on their own behalf in nobody's interests but their own. One would think that they were almost a self-elected corporate body. However, they are not. Most of the people who man these local authorities face the electorate more regularly than any other elected men and women in this country. Very often their decision on activities must be voted upon, and they are approved or disapproved accordingly. These local authorities are fighting to protect the interests of their ratepayers full stop.
The Government continually say that they have no money of their own; that the money they have is collected from the community on behalf of, the community and is apportioned to that community. That is the situation in local government. I think that the Bill before us is a bit strong, bearing in mind that from many sides of the Chamber—not only from these Benches but from the Alliance Benches and the Cross-Benches—there have been continual complaints about a succession of statements on rate support grant that, at least over the three and half years since I have been in this place, have become steadily more complicated and more difficult to understand, so that obviously the Government have had to come back and change them at the next drop of the hat.
This amendment, which deals with a major part of the Bill, makes sure that there will never be any need for a Secretary of State to make a statement on the rate support grant other than to inform us of what he wants to be in it. One can talk about consultation and negotiation, but those of us who have been involved know from past experience that when a decision is made as to the percentage there is little consultation. I wonder why the Government are insistent that local authorities should not have the recourse to law that is available to other individuals and sections of the community. Could that have its roots in the fact that the present Secretary of State for the Environment, in his earlier capacity as Minister for Transport, on more than one occasion had to go before the courts to account for some of his actions and it was found that he had misinterpreted his powers? He had in fact

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misinterpreted the law and corrective legislation had to be brought in retrospectively. He had broken the law, though probably unknowingly. The fact of the matter nonetheless is that he broke the law.
I think that it is a dangerous situation when, in the final analysis, the Government intend to tie up the law so completely that nobody has recourse to the law and people do not have the benefits of the impartiality for which our courts are famed. I think that it is a regrettable state of affairs. Sometime in the future the Government may cast their mind back and may well say that this was something they would rather forget. Nevertheless, the amendment is designed to prevent the Secretary of State from having power to disallow for block grant any contribution to a special fund, or expenditure financed from a special fund, prior to 1st April 1987.
This amendment deals with one aspect of this Bill which goes beyond putting the legal base of the rate support grant on to a sound footing. My noble friend Lady Fisher referred to the 11 authorities to which the Secretary of State has already written. I had a list of 13. There may be more by now, because my information is a little dated. There are nine Labour-controlled and four Conservative-controlled authorities among them. There is therefore a spread of political views and responsibilities. The Secretary of State has written to those authorities asking for further details of transfers that they had made to special funds and which have resulted in deficits on their rate funds. I understand that the letter also said that the Secretary of State proposed to use the powers contained in the Bill to put beyond doubt the fact that such transfers cannot be made for 1983–84 and subsequent years.
The objection to that proposal is that it is retrospective. The Government may pedantically say that, inasmuch as they will change the rules in future supplementary reports it will not be retrospective. However, the authorities have brought into account the grant that those transfers produced. Against that, the Government will say that the cash flow will not take effect until next year and therefore authorities can budget for it. The authorities undertook those transfers in good faith. Their actions were often backed by auditors' opinions. The Government will argue that those authorities are gaining grant by unfair means at the expense of other authorities. Against that, the Association of Metropolitan Authorities believes that those authorities should be paid the grant that they claimed on the basis of a bona fide interpretation of the law. The Government will argue that those transfers were illegal and that the grant would not have been paid on the basis of those transfers. It can be said that the fairest way to resolve that dispute would be to let the courts decide who had correctly interpreted the law.
There is a great deal in that last point. It encapsulates what this dispute is all about. Under the Bill, there will be no recourse to the law. The Secretary of State will determine what will happen. That is not the way that Conservative or Labour governments traditionally do things. I support the amendment.
Lord Bellwin: I shall make just one or two observations on what the noble Lord, Lord Dean, has said. The record has constantly to be put straight when
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we debate this subject. For my sins, I am one of those who well remember all this. The noble Lord expressed his anxiety at the power that the Bill may give an extreme government in the future. If we ever have such a government with a majority, he can be sure that they will do what they want. We should have no doubts about that.
Lord Dean of Beswick: That is no excuse.
6.15 p.m.
Lord Bellwin: I had to smile when the noble Lord talked about local authorities fighting to protect their ratepayers' interests. I wonder what the people who live in some of the inner London boroughs will say to that. They may wonder what kind of fighting is being done on their behalf. I suspect that they may think that the local authorities are only fighting to extract ever more money. The last thing one could accuse them of is fighting to protect their ratepayers' interests.
The noble Lord said that the rate support grant was becoming more and more complicated and difficult to understand. Complicated it is; and difficult to understand it is. I well remember the meetings that I attended to try to fathom out how the system worked. When we debated block grant in this place in 1980, we were told that the system was so obscure that no one could understand it. I said that I would sit down and give way to anyone who could explain how the system worked. Not one Member of this place stood up. I had to say ask how, if no one understood how the system worked, they could object to what was then being proposed. Nothing more was said. Complicated it is; but new it ain't. It is not getting easier, but it never was easy.
The noble Lord said there has been little consultation. That depends upon the view that one takes. I would only say that there is a darn sight more now than there ever was when I was involved. If that was inadequate, there it is.
I was interested to hear great concern expressed that we should all now go to court to have the issues decided. I have stood in this place to bring forward Bills. I was told that the last thing we wanted to do was to go to court. Suddenly there is a new-found wish to do so. That may be what the noble Lord and the noble Baroness would like, but it is not what I should like and I suspect that not many Members on this side of the Committee would like that.
As I said in the earlier debate, I am not without sympathy for the underlying theology of what is being said about retrospectively disallowing expenditure and such matters. It is not an ideal situation. No one has sought to say that it is. When trying to decide how it came about, all one can do is look at the interpretation of the 1980 legislation which the noble and learned Lord, Lord Denning, so effectively ridiculed earlier. That had merit, because of the way the legislation was set out. No one would deny that. The legislation was a genuine attempt by the Government to try to meet the wishes of the local authority associations. It seems that we just cannot win. We say either "Yes" or -No" or "We will" or "We will not". We cannot do right.
I hope that we shall not accept the amendment. I can understand why it has been brought forward. It

55
was done with good intentions and in an attempt to try and limit central government's centralisation of local government. I am not without sympathy for that view. I understand it. If we must have this legislation, and I think everyone agrees that we must, it is just about as right as we shall get it.
Lord Dean of Beswick: I think that I should respond. I think the contribution of the noble Lord, Lord Bellwin, goes a little wide of the amendment. I was not suggesting that I wanted to hold up the eight inner London boroughs as an example of those fighting to protect ratepayers' interests. The noble Lord fully belaboured that point for about 20 minutes a couple of weeks ago. In contrast to those eight London boroughs, there are a mass of other authorities, including some of those I have read out which are Conservative-controlled, which have acted with discipline and reasonableness. But they find themselves on the receiving end. Those are the authorities which I was talking about. We should not let the way that the leaders of eight London boroughs have behaved blight the whole of local government.
Lord Bellwin: The noble Lord has a background in local government for which I have great respect. If he and others who speak on that side of this Committee would only join in the open condemnation of what those people do to the whole of local government, not only should we have more respect for the argument but I think it would help. That is all that I have sought to do in my observations on local government during the past couple of months.
Lord Dean of Beswick: If the noble Lord had been in his place during our last local government debate, he would have heard my criticism of my local authority in Manchester.
Lord Underhill: I was going to say the same as my noble friend Lord Dean. I am sorry to have to cross swords with my old antagonist the noble Lord, Lord Bellwin. He and I cut our teeth on either side of the Dispatch Box way back in 1980 and we have regarded ourselves as bosom friends since then.
We are almost having a Second Reading debate. As my noble friend said, we debated the whole question of the inner London authorities, exhaustively for hours and hours. My noble friend referred to a list, but when one looks at the list one finds that the authorities are not all in inner London authorities nor are they all Labour.
It may be appropriate for the Committee to hear the list, because the Secretary of State wrote to all 13: Birmingham, Warwickshire, Cambridgeshire, West Wiltshire (I believe that is solid socialist), Oadby and Wigstone, Hammersmith and Fulham, Lewisham, Liverpool, St. Helens, Wigan, Leeds. Leeds featured quite a lot in the debate in the other place, along with Birmingham.
I am not allowed to quote from speeches of non-Ministers from the other place, but I noticed in col. 73 of the Official Report of 26th January that the Secretary of State said:
56
"We can resolve the issue of what Leeds city council has done by the council coming to my Department and giving it the full details".
That is what the Minister said. Perhaps Birmingham will note that.
Lord Bellwin: Let me just say that the Minister would never have written to Leeds during my time there.
Lord Underhill: For the benefit of the Committee, it is best that the noble Lord is here rather than staying in Leeds.
The Secretary of State went on:
"As I have explained, the deficit financing issue first came to light in a letter from the Birmingham auditors of 16 May".
I thought my noble friend Lady Fisher explained the Birmingham position in detail. I hope Members of the Committee appreciated it. I almost regard Birmingham as my adopted city, as I lived there for 13 years during the reconstruction period; Birmingham does not have a lot of madmen; it does not have a lot of crazy Left-wing politicians. It has very responsible leadership. Birmingham is included in the list, and it feels it has been hard done by. My noble friend Lady Fisher explained the reasons for that.
As the association of which I am president has made perfectly clear—and I reiterate what my noble friend Lord Dean said—the authorities undertook the transfers in complete good faith, often backed by auditors' opinions. In the case of Birmingham I understand its action was definitely based on auditors' opinion. When local authorities' actions have been justified and backed by their auditors, it seems that consideration should be given to that. The AMA said that it believes that those authorities should be paid the grant which they claim on the basis of a bona fide interpretation of the law as it was at that time.
I do not think we should be sidetracked into considering the actions of inner London authorities. We should deal with the amendment as it stands, keeping in mind the details of the case of Birmingham which my noble friend Lady Fisher has given.
Lord Skelmersdale: Before I start to answer what has developed into a surprisingly lengthy debate on the amendment considering the scope of the subject—the length is principally about other matters—I must take a retrospective action. In answer to Amendment No. 10 I said that, as I understood the position, it contravened Clause 15 of the Bill and was covered by a money resolution. I am now advised that it may well not be within the scope of the money resolution, but if the amendment were adopted—as of course it still can be in the future—another place may decide to invoke financial privilege to reject it. That is not to say—this is where I am totally at fault, and I apologise most sincerely to the Committee—that it cannot be moved here. I promised earlier that I would make the position clear as soon as I reasonably could, and I hope that the Committee will accept this apology.
Baroness David: I am extremely grateful to the Minister for that handsome apology and for having cleared up the point. It is extremely helpful. In the light of what he said, we shall reconsider what to do at Report stage, knowing what the facts are. I thank him.
Lord Skelmersdale: I have absolutely no doubt that the noble Baroness and her team will consider most carefully what I have said and what actions they wish to flow from it.
Amendment No. 11 is about actions flowing from various things. I am extremely grateful to the noble Baroness for her exhaustive reading on the subject of local government finance when, unfortunately, she was recovering from an illness, about which I did not know. I hope that she has fully recovered and is back in fighting form, as her speech certainly shows.
I can confirm that what we have been talking about both on Second Reading and today is the narrow interpretation which maintains that status quo; in other words, what local authorities have always used for these calculations and what the Government have always used. There is nothing sinister in what we are doing. The argument that has been expressed both on Second Reading and today, as I understand it, has been about whether we are going about it fairly and properly.
As far as the cake is concerned, the noble Baroness is quite right, but I take issue with her on the local authorities' definition of meanness of the cake. An extra £3 billion being made available for the next financial year cannot be mean by any possible stretch of the imagination.
I thought that the debate would get to Birmingham sooner or later. Birmingham is a very good example of what the noble Baroness, Lady Fisher, was talking about. The position there appears to apply also to some other local authorities. Let me say at the outset that we have reached no final view of what those authorities have done. A number of them have written to us and we are considering carefully what they said. In the case of another authority, at its request it has a meeting with my honourable friend the Parliamentary Under-Secretary of State and on Thursday my officials are meeting Birmingham's treasurer, Mr. Caulcott, whom the noble Baroness did not name.
Baroness Fisher of Rednal: Mr. Caulcott is not the city treasurer; he is the chief executive. Mr. Farrer is the city treasurer.
Lord Skelmersdale: I apologise. I am grateful to the noble Baroness for the correction.
Much has been said about the Government overriding what auditors have accepted and trying to move the goal posts. Such comments betray a complete misunderstanding of the position. The issue is quite simply this. Should grant be paid on the basis of figures of total expenditure affected by contributions from the rate fund revenue to special funds which have created or added to a deficit on that account and which are not related to known specific liabilities, or not? This is a matter for my right honourable friend the Secretary of State and is quite different from the responsibilities auditors have in relation to the accounts. While my right honourable friend has reached no final view on this, and indeed he already has powers to reach such a view, he has indicated his first thoughts on these matters; namely, that he does not believe that this practice—which now is
58
commonly termed deficit financing—is an equitable basis on which to pay grant. I am sure the Committee would agree with that sentiment.
Although my right honourable friend has reached no final view, Birmingham's papers, to which the noble Baroness referred, make the following matters clear. First, the council took a decision to put a certain sum into a special fund knowing that this would create a deficit on the general rate fund. It did this in order to gain an increased entitlement to block grant. Secondly, the Audit Commission, when asked about the proposed action, expressed considerable reservations and suggested that the city council's auditors draw it to the attention of my department. Thirdly, although the auditors took the view that the transaction was lawful, they agreed to draw it to the attention of my department to consider the rate support grant implications. They did this in the letter of 16th May 1986. Therefore, although it was legal, quite clearly everybody thought that it was questionable. It is on the fact that it is questionable that my right honourable friend has to make up his mind.
I am not sure that the noble Baroness, or any noble Lord, in this wide-ranging debate exactly used the expression, but the suggestion is about moving the goal posts. Nonetheless, the impression is around that this is what the Government intend to do. The present statutory position is that total deficit financing transactions are excluded from relevant and total expenditure, as are all transactions relating to contributions to special funds.
The Bill provides that in general contributions to or from special funds are included within relevant and total expenditure—in other words, what Birmingham was doing. However, it appears with a number of other authorities to be going slightly over the top. We therefore need a provision for the Secretary of State to deduct these transfers which cause a deficit on the rate fund revenue account.
The Bill also provides that it is open to my right honourable friend to make specifications which would enable him to exclude deficit financing transactions from relevant and total expenditure when we come to make further rate support grant reports and supplementary reports. Before making any such specification he will of course consider all representations received and will consult where required. The views of all authorities can be taken into account. There is no question of retrospection. Authorities such as Birmingham have made returns of expenditure for us to use when we come to make further supplementary reports, and any specification which my right honourable friend makes will apply to the future reports and estimates of grant entitlement that we make thereafter.
On going to court—which has been a concern in this short debate—if my right honourable friend makes a specification about deficit financing, that specification will be reviewable by the courts in the normal way, because it will have been an action taken after the passing of the Act. The amendment is designed to prevent my right honourable friend from making such specifications. The overall effect of not making such specifications will be that deficit financing transactions for the first time will be statutorily included in relevant and total expenditure. I am sure that the Committee

59
will agree that it would not be appropriate so to amend the Bill that it would no longer be open to my right honourable friend to make specifications having the effect of excluding deficit financing. Therefore I hope that the noble Baroness will be able to see fit to withdraw this amendment.
I could dilate at length—although I hope that the Committee does not wish me to—on Birmingham and the differences in the positive and negative marginal grant rates that have existed over the last two years since it adopted this process. I am quite happy to go into Birmingham's finances as expressed in the letter of 16th May as much as anyone wants me to. But I hope that I have said enough to explain why my right honourable friend needs these powers.
6.30 p.m.
Lord Silkin of Dulwich: There is only one point that I wish to raise arising from what the Minister said. It concerns the relevance or otherwise of Clause 9(6), which provides:
"any power to specify"—
under certain parts of the Bill—
"shall be exercised in accordance with principles to be applied to all local authorities".
I wish to ask the Minister these questions on the subject of deficit financing, as it has formed a prominent part of what he has just said to the Committee. First, is subsection (6) applicable in relation to the amendment which we are now debating and to that part of the Bill which the amendment will affect; or is the Secretary of State able to make his decisions—still unmade, I gather from the Minister—without regard to the provisions of that subsection? In other words can the Secretary of State say, "The deficit financing of local authority A was"—to use the Minister's term—"rather over the top but that of local authority B was acceptable. I shall therefore act in relation to local authority A but not in relation to local authority B "; or is the Secretary of State required to say in effect, "I am against deficit financing wherever it may have occurred", or, "I am prepared to accept it wherever it may have occurred"; and depending on which of those views he accepts after receiving the necessary representations and consulting local authority associations as provided for by Clause 9(4), that is the decision and it is to be applicable to all local authorities which may either have acted or wish to act in the future by way of deficit financing?
That is obviously an extremely important question. The Minister has accepted that deficit financing is lawful. But he has used the term "questionable" in relation to it. In other words, it is not altogether desirable or proper, although lawful. There is nothing, I gather from what the Minister says, that could be complained about by a ratepayer as being unlawful. Indeed I suppose one would have to say to a ratepayer of a particular authority who complained, "This is lawful and we have done it in order to benefit you, the ratepayer, of our authority because we hope that we shall do better by the use of deficit financing than if we do not use it".
From the point of view both of those local authorities that have been using that system and of
60
those that may be thinking about it for the future, it is of great importance to know the answer to that question. It does not bear directly upon the amendment. However, it bears upon the amendment by virtue of what the Minister told us. I hope that he will give us the answers.
Lord Skelmersdale: Yes, both subsections directly bear on the subject of this amendment and indeed any specifications that my right honourable friend may make under the Bill when it becomes an Act. At the top of page 8 subsection (4) says:
"Before exercising the power"—
in other words, the power to make a specification—
"the Secretary of State shall consult such associations of local authorities as appear to him to be concerned and any local authority with whom consultation appears to him to be desirable".
That is a perfectly normal formulation of consultation in local authority law.
If my right honourable friend decided to specify on a subject which is now being given the unholy title of "deficit finance", both that subsection and subsection (6) would apply. Subsection (6) simply means that any specification made under Section 2(4) or 3(1) of the Act and so on must have general effect for all local authorities. In other words, my right honourable friend will not be allowed under the law to pick different local authorities off the tree to suit his convenience. This would be totally unfair and improper. My right honourable friend does not intend to do it.
Baroness David: I should like to add one word in support of this amendment which is in the names of my noble friend Lady Fisher of Rednal and myself. This amendment deals with one aspect of the Bill which goes well beyond putting the legal basis of rate support grant on a sound footing. I hope that the Minister realised the strength of feeling particularly in Birmingham, although the amendment also refers to other authorities. There is very great deprivation in Birmingham. If this amendment is not accepted by the Government, Birmingham will lose millions of pounds of grant and there will be a great deal of deprivation for the people of that city and the ratepayers will suffer as a result.
Although I do not live in Birmingham I know a great deal about the situation which exists there because I have a daughter who works as a full-time social worker for Birmingham city council. I hear a great deal about what happens there. It is only fair that this situation should be put right and not be put aside by the Government. It is a very important consideration.
Lord Skelmersdale: The Government are not unfeeling and they are certainly not unaware of the situation in Birmingham to which the noble Baroness, Lady David, has made reference. I should like to remind her that this year's rate support grant for Birmingham is £30 million more than last year.
Baroness Fisher of Rednal: I should like to thank all noble Lords who have spoken in support of this amendment. The thinking behind the decision of the Birmingham city council—which was agreed to by all

61
members on the advice of its officers—was not to increase the block grant as the Minister said. I should like to correct him and say that it was in order to avoid penalties. Penalties affect a large local authority such as Birmingham in that a 3 per cent. overspend (that is £11.6 million overspend) would cost £42 million worth of grant loss to the city on a penalty because they had overspent by 3 per cent.
As the noble Baroness, Lady David, said, it was only a few weeks ago in this House that we had the very moving debate which was initiated by the noble and learned Lord, Lord Scarman and the most reverend Primate the Archbishop of Canterbury in which they spoke very movingly about inner cities. For that reason (and also because for a number of years I was a member of the city council and, in another place, a Member for an inner city area). I feel so strongly that the penalties that this Government are putting down are penalties which such authorities cannot take. The Minister says that the Government care, but I say that they do not care enough.
In so far as concerns Birmingham and other such local authorities, they operated the law as it was. There was nothing wrong in what they were doing. The Secretary of State does not say that they were doing anything illegal. In the debate in another place he said that there was nothing illegal. I am a magistrate and if an accused person comes before me in the court and at some stage the clerk says that there is no case to answer, there is no contravention of the law, then the accused is discharged. He walks out free. This is the situation here: nothing illegal has been done and there is no case to answer. I am not so eminent as the noble and learned Lords, Lord Silkin and Lord Denning, or the noble Lord, Lord Foot, who is not in his place at present. I speak as a lay-magistrate and the way that I have to interpret the law. One would have thought that the law was the law. If you have not done anything illegal, you have done nothing wrong. Therefore the Birmingham city council and the other local authorities that have been mentioned have done nothing wrong.
The transaction was completely open and above board. The facts were given first to one and then to another committee of the council which comprised Tories and Labour members. A course was precedented in previous years by the Tories when they were in control in 1982–83. They taught the Labour council a very good lesson. The Labour council thought, "well, if the Tories can get away with it, we will be able to get away with it". Obviously that is when the goal posts change and when people start acting in a different way.
The transaction was sanctioned by a firm of very well known accountants, and the auditors were beyond reproach. Nothing that the Minister has said this afternoon has convinced me that what took place was wrong. Therefore, I am going to test the opinion of the House. I hope that Members of the Committee will recognise that an injustice will be done if this amendment is not carried.
6.47 p.m.
On Question, Whether the said amendment (No. 11) shall be agreed to?
Their Lordships divided: Contents, 79; Not-Contents 128.

DIVISION NO.2

CONTENTS

Airedale, L.

Longford, E.

Amherst, E.

Lovell-Davis, L.

Attlee, E.

McGregor of Durris, L.

Beswick, L.

Mclntosh of Haringey, L.

Boston of Faversham, L.

McNair, L.

Bottomley, L.

Milner of Leeds, L.

Brooks of Tremorfa, L.

Molloy, L.

Campbell of Eskan, L.

Morton of Shuna, L.

Carmichael of Kelvingrove, L.

Murray of Epping Forest, L.

Cledwyn of Penrhos, L.

Nicol, B.

David, B.

Northfield, L.

Dean of Beswick, L.

Phillips, B.

Denning, L.

Pitt of Hampstead, L.

Diamond, L.

Ponsonby of Shulbrede, L.

Elwyn-Jones, L.

[Teller.]

Ennals, L.

Prys-Davies, L.

Falkender, B.

Rea, L.

Fisher of Rednal, B.

Ritchie of Dundee, L.

Fitt, L.

Robson of Kiddington, B.

Fletcher, L.

Rochester, L.

Gallacher, L. [Teller.]

Ross of Marnock, L.

Gladwyn, L.

Seear, B.

Grey, E.

Serota, B.

Grimond, L.

Shepherd, L.

Hampton, L.

Silkin of Dulwich, L.

Hanworth, V.

Stedman, B.

Harris of Greenwich, L.

Stewart of Fulham, L.

Howie of Troon, L.

Taylor of Blackburn, L.

Hutchinson of Lullington, L.

Taylor of Gryfe, L.

Jeger, B.

Taylor of Mansfield, L.

Jenkins of Putney, L.

Tordoff, L.

John-Mackie, L.

Underhill, L.

Kagan, L.

Whaddon, L.

Kennet, L.

White, B.

Kilmarnock, L.

Williams of Elvel, L.

Kirkhill, L.

Wilson of Rievaulx, L.

Kirkwood, L.

Winchilsea and Nottingham,

Listowel, E.

E.

Llewelyn-Davies of Hastoe, B.

Young of Dartington, L.

Lloyd of Kilgerran, L.

Ypres, E.

Lockwood, B.

NOT CONTENTS

Allenby of Megiddo, V.

Clitheroe, L.

Allerton, L.

Coleraine, L.

Ampthill, L.

Colville of Culross, V.

Auckland, L.

Cowley, E.

Bauer, L.

Cox, B.

Beaverbrook, L.

Crathorne, L.

Belhaven and Stenton, L.

Crawford and Balcarres, E.

Bellwin, L.

Davidson, V. [Teller.]

Beloff, L.

De La Warr, E.

Belstead, L.

Denham, L. [Teller.]

Bethell, L.

Dilhorne, V.

Biddulph, L.

Dundee, E.

Blake, L.

Elibank, L.

Boardman, L.

Elles, B.

Boyd-Carpenter, L.

Elliot of Harwood, B.

Brabazon of Tara, L.

Elliott of Morpeth, L.

Brougham and Vaux, L.

Elton, L.

Broxbourne, L.

Enniskillen, E.

Bruce-Gardyne, L.

Faithfull, B.

Butterworth, L.

Fanshawe of Richmond, L.

Buxton of Alsa, L.

Ferrier, L.

Caithness, E.

Fortescue, E.

Cameron of Lochbroom, L.

Fraser of Kilmorack, L.

Campbell of Alloway, L.

Gainford, L.

Campbell of Croy, L.

Gardner of Parkes, B.

Carnegy of Lour, B.

Gormanston, V.

Carnock, L.

Gridley, L.

Cathcart, E.

Haig, E.

63

Halsbury, E.

Nugent of Guildford, L.

Hanson, L.

Onslow, E.

Harmar-Nicholls, L.

Orkney, E.

Hesketh, L.

Pender, L.

Hives, L.

Peyton of Yeovil, L.

Holderness, L.

Plummer of St Marylebone,

Home of the Hirsel, L.

L.

Hood, V.

Rankeillour, L.

Hooper, B.

Redesdale, L.

Kaberry of Adel, L.

Renwick, L.

Killearn, L.

Rodney, L

Kimball, L.

Rollo, L.

Kinnoull, L.

Rugby, L.

Lane-Fox, B.

St. Davids, V.

Lauderdale, E.

Saltoun of Abernethy, Ly.

Layton, L.

Sandford, L.

Lindsey and Abingdon, E.

Shannon, E.

Long, V.

Sharples, B.

Lothian, M.

Skelmersdale, L.

Lucas of Chilworth, L.

Strange, B.

Luke, L.

Strathcarron. L.

Lyell, L.

Strathsclyde, L.

Mackintosh of Halifax, V,

Sudeley, L.

Malmesbury, E.

Swinton, E.

Margadale, L.

Thomas of Swynnerton, L.

Marley, L.

Thorneycroft, L.

Marshall of Leeds, L.

Tranmire, L.

Maude of Stratford-upon-

Trefgarne, L.

Avon, L.

Trumpington, B.

Merrivale, L.

Vickers, B.

Mersey, V.

Vivian, L.

Milverton, L.

Ward of Witley, V.

Monk Bretton, L.

Whitelaw, V.

Morris, L.

Wise, L.

Mottistone, L.

Wyatt of Weeford, L.

Munster, E.

Wynford, L.

Murton of Lindisfarne, L.

Young of Graffham, L.

Resolved in the negative, and amendment disagreed to accordingly.
6.55 p.m.
On Question, Whether Clause 5 shall stand part of the Bill?
Baroness David: We have had a good discussion on this clause, but I cannot let it pass without making one comment. The 13 authorities we have been talking about—I think my noble friend Lord Underhill read out which they were—will, as a consequence of the rate support grant order soon to be laid before the other place, receive less block grant than their entitlement. In the case of Birmingham, that amounts to millions of pounds of income that will have to be found from the ratepayers.
In Birmingham's case (and this may well be true of the other authorities) the authority's financial accounts have been closed and subsequently audited and approved by the external auditors—in this case Price, Waterhouse, as has been mentioned—and the Audit Commission, which expressed some doubts earlier on, accepted that this was all valid. It simply cannot be right that authorities should be retrospectively penalised for actions which were at the time clearly within the law and within the proper professional practices of accountancy. Those are the reasons why we do not like this clause.
Lord Skelmersdale: The noble Baroness has yet again managed to read more into the clause than the clause actually deserves. Subsections (1), (2), (3) and (4) provide for future years—that is, the financial year
64
1987–88 and those following—in both England and Wales until such time as we can get on to a new finance system for local authorities, which the noble Baroness and I have in recent weeks agreed is desperately necessary. However, what we are concerned with now is the situation we have at the moment.
Those subsections apply the new system back to the intermediate years. In other words, they create a notional rate fund revenue account for those years. As I seem to have said repeatedly this afternoon, local authorities have always kept traditional non-statutory main revenue accounts. Clause 5 provides that block grant will be paid on a notional rate fund revenue account which is essentially the same as the accounts local authorities have always kept.
I do not see this as penalising local authorities. If my right honourable friend finds the need—which he does not—to penalise local authorities, there are other methods. I can assure the noble Baroness that Clause 5 of this Bill is not among them.
Clause 5 agreed to.
Baroness Hooper: This may be a convenient moment to take a break in proceedings. In moving that the House now resume, may I suggest that we do not return to this Bill before eight o'clock? I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Debtors (Scotland) Bill [H.L.]
6.58 p.m.
The Lord Advocate (Lord Cameron of Lochbroom): My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Debtors (Scotland) Bill, has consented to place her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read a third time.—(Lord Cameron of Lochbroom.)
On Question, Bill read a third time.
An amendment (privilege) made.
Lord Cameron of Loch broom: My Lords, I beg to move that this Bill do now pass. In doing so, I should like to express my gratitude to the noble Lord, Lord Morton of Shuna and the noble and learned Lord, Lord Wilson of Langside, and their colleagues on the Benches opposite for the general welcome that they have given to this Bill. They have nevertheless given the Bill their most careful consideration. The amendments made to the Bill on Report were a tribute to the very useful debates we had during the Committee stage, when I was pleased to be able to accept the principle of certain amendments put down by the noble Lord, Lord Morton of Shuna, for which I am particularly indebted.

65
I should also like to thank my noble friends Lady Carnegy of Lour and Lord Sanderson of Bowden, the noble Lord, Lord Carmichael of Kelvingrove, and the noble and learned Lord, Lord Wilson of Langside, for their contributions to the debate during the Committee and Report Stages.
The noble Lord, Lord Morton, himself remarked during the debate in Committee that it made a pleasant change for a debate on a Scottish legal Bill to involve something more than a discussion between the respective Front Benches. I fully endorse that sentiment. While we have perhaps strayed at times into household realms involving refrigerators and champagne, it has nevertheless been a most important and much needed measure of law reform which we have had before us and which has been yet further improved by the consideration it has had given to it by noble Lords. I beg to move.
Moved, That the Bill do now pass.—(Lord Cameron of. Lochbroom.)
Lord Morton of Shuna: My Lords, the Bill is a considerable improvement on the law as it was. I am grateful to the noble and learned Lord for what he said about such amendments as he was prepared to accept from me, but I have a great regret that he was not prepared to accept the debt arrangement scheme which the Law Commission had recommended. I have a feeling that the Bill is perhaps not as good as it might otherwise have been, but subject to that it is better than nothing and I give it a welcome.
On Question, Bill passed, and sent to the Commons.
The Earl of Dundee: My Lords, I beg to move that the House do now adjourn during pleasure until eight o'clock.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.4 until 8 p.m.]

Local Government Finance Bill
House again in Committee.
Clause 6 [Validation of past acts]
[Amendment No. 12 not moved.]
Baroness David Baroness David moved Amendment No. 13:
Page 5, line 46, at end insert ("provided that any such total shall have been reasonably estimated")
The noble Baroness said: In speaking to Amendment No. 13, I should also like to speak to Amendments Nos. 15, 17 and 22. These amendments require the Secretary of State to have acted reasonably in relation to rate-capping—the word "reasonably" appears in all these amendments—and will require decisions retrospectively validated to have been made reasonably as a condition of immunity.
These amendments concentrate on the provisions of Clause 6(2), which validate retrospectively anything
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done by the Secretary of State before the passing of the Act in connection with his powers under Part I of the Rates Act 1984 for the financial years 1985–86 and 1986–87: that is rate-capping. As will have been clear from the previous group, the clause effectively means that no legal challenge will now be possible against the Secretary of State's actions in relation to rate-capping since its introduction in 1985–86 up to the present time.
The amendments propose an alternative mechanism, although within the context of the Bill's proposals. Only those past decisions of the Secretary of State which were arrived at reasonably, having regard to the exercise of his discretion, would be validated retrospectively. Likewise, the retrospective deeming of calculations of total expenditure by the DoE to have been lawful under Clause 6(1) would also need to have been made reasonably. Thus the amendments would preserve the criterion of reasonableness in judging the lawfulness of these acts and as a consequence—this is the important point—leave some opportunity for testing issues in the courts.
The last amendment in the group, Amendment No. 22, deals with unreasonable acts. Under the new subsection, Clause 6(5)(a), they would continue to be validated retrospectively, provided that the procedures in the new Clause 6(5)(b) were complied with. Under that subsection, the Secretary of State would be required, if he were to earn the legal protection of the clause, to specify what he ought to have done in the particular case to have made his action lawful in the first place. This explanation will be required within 14 days of the Royal Assent or of the final decision in respect of any court case brought against his actions: for example, the case of Greenwich.
If this amendment were put into operation it would expose any doubts which may exist in the DoE about other areas of the exercise of discretion as well as the legal problems with relevant and total expenditure. The wide scope of the retrospective provisions must give rise to suspicions that such official doubts exist. Although under this amendment the Secretary of State could ultimately have his retrospective immunity, in order to achieve it he would have to announce publicly the steps taken in the unreasonable exercise of this discretion. If he failed to admit to such areas of doubt within 14 days, further legal challenges would be possible at a later stage on those points, against which he would have no retrospective protection under the Act.
The aim of these amendments is to put a few controls on the Secretary of State. There is still great uncertainty within the local authorities about how extensively the Secretary of State will use his new powers. The local authorities would feel that there were some safeguards if this group of amendments were accepted. I beg to move.
Baroness Hooper: There has already been considerable discussion about the scope of the validation of the Secretary of State's past decisions on rate limitation, and it is now being suggested by means of these amendments that we should in some way aim to validate the decisions so that they cannot be challenged on the grounds of the problems relating to

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relevant and total expenditure but would be open to challenge on the grounds of unreasonableness.
I have to say to your Lordships that even if it were possible to achieve this while making it clear how the past decisions are affected by the Bill, it would be an utterly unnecessary complication. When taking rate limitation decisions, my right honourable friends have always been bound by the general administrative law requirement not to act unreasonably, and they firmly believe that they have fulfilled this requirement. Even the recent court challenge to certain of my right honourable friend's decisions—in the cases of Greenwich and South Yorkshire—have not been brought on the grounds of unreasonableness and nobody has suggested that my right honourable friends have acted unreasonably.
Indeed, the rules of the Supreme Court and the Supreme Court Act 1981 require that challenges be brought promptly and at any rate within three months, except in exceptional circumstances. So local authorities know that challenges to all these decisions should have been brought by now. One may therefore presume that no local authority considers that any decision in issue here was unreasonable, in the sense of the Wednesbury case—which is of course the leading authority on the subject. I would also remind your Lordships that we have conceded the Greenwich and Islington cases solely on the ground of the total expenditure problem. My right honourable friends do not accept that their decisions were flawed on the grounds suggested by the authorities.
The purpose of Clause 6 as it stands is this. The Secretary of State's past decisions on rate limitation are affected to a greater or lesser extent by the practice adopted in defining total and relevant expenditure. We have clear advice that that practice is incorrect in law. It is a practice which local government asked us to adopt in the first place, and in those circumstances it would be quite wrong, we believe, to leave any uncertainty about whether those past decisions are valid. Clause 76 gives that certainty and we feel that these amendments put forward by the Opposition would undermine it. I therefore recommend that the Committee should reject these amendments.
Lord Dean of Beswick: It is with some regret that we hear, through the Minister, that the Government are almost totally unsympathetic to what these amendments are trying to achieve. We fully accept that the Government understand the purpose; but we fail to understand the total non-acceptance of what we are trying to do. The rejection of these amendments, as we see it, means that once the Act becomes law the Secretary of State will have almost carte blanche authority to do what he wants. In her reply, the Minister indicated that Greenwich and another local authority were being accepted as being outside the particular scheme and were being allowed to go ahead at present. Can she confirm whether that was in fact correct?
Baroness Hooper: I said that the concession on the Greenwich and Islington cases was made on the basis of the total expenditure problem.
Lord Dean of Beswick: Is one to assume from that that the Government think that only Greenwich and the other local authority in question have that financial problem? I suspect that there are others in a somewhat similar position. I do not know that one can pick out one-offs in terms of local authorities when dealing with rate support grant, rate capping and the conglomerate of conditions that are imposed on local authorities in arriving at the final support grant figures.
What I think is odd is that only two authorities have been singled out. The Minister said that it was because of the peculiarity of the financial situation there, but I should have thought that when you start dealing with two local authorities in a different way from the rest you are to a great extent varying the principle that is being put through in this Bill. The Minister is nodding his head—
Lord Skelmersdale: I am shaking it.
Lord Dean of Beswick: Is the Minister saying that there are circumstances in which some of the other local authorities will be allowed the same freedom to act as Greenwich and the other authority that has been mentioned? Is he saying that now?
Baroness Hooper: No. As I understand it, it is up to the local authorities to challenge the decisions of the Secretary of State, and so far the local authorities that have done so are the ones to which I have referred. As I mentioned earlier, the normal period for making these challenges is within three months unless the circumstances are exceptional. In the case of all the decisions and orders referred to in the various subsections to which amendments have been proposed, I believe that the last order was laid last July, which has allowed the local authorities plenty of time.
Lord Dean of Beswick: So what the Minister is now saying is that the other authorities are out of time? Is the Minister saying that they have missed the bus?
Baroness Hooper: I could say that it would be unreasonable to allow them to do otherwise.
Lord Dean of Beswick: It seems odd that the Government are saying that it would be unreasonable to allow them to do otherwise, when a number of other local authorities could say, "Our financial position and our latest appraisal are the same as Greenwich and we are in an identical position". If we are now making law, I do not see why the Government cannot say that if an authority is in the same position as Greenwich and that other local authority, it can have the same consideration. This Bill is trying to rewrite the law on the rate support grant and I see no reason why this amendment cannot be accepted on that basis.
As my noble friend and colleague said in moving this amendment, and as will be seen from the previous group, the clause effectively means that no legal challenge will now be possible against the Secretary of

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State's action in relation to rate-capping from its introduction in 1985–86 up to the present. Bearing in mind that this Bill will become a new Act of Parliament, I take it—though I am not legally qualified like my noble and learned colleague Lord Silkin—that it puts in limbo most of the things that we believed to be the law until it becomes a new law retrospectively.
Therefore, it is not unreasonable to ask that all local authorities should be treated in the same manner. If this were a completely new Bill, making history with no history to fall back on, the Government could well be accused of hybridity by treating some local authorities differently from others. On that basis, this is a reasonable series of amendments and I hope that the Government will give some serious and more sympathetic consideration to it.
8.15 p.m.
Lord Silkin of Dulwich: I must confess that I was surprised to hear the noble Baroness resting the department's case on the Wednesbury decision. It is one with which, from time to time, I had something to do in an earlier period, as may be imagined, and I came to know it fairly thoroughly. My understanding of Wednesbury was that what was decided was that one cannot challenge the decision of a Minister or a public authority on the grounds that it is an unreason-able decision unless no reasonable person in the position of the Minister or a public authority could possibly have made such a decision. In other words, it must be a decision which is beyond all possible reason in the circumstances. Unless you can reach that very high standard, according to the decision in Wednesbury, judicial review would not lie.
To equate that with the meaning of "reasonable" in these amendments seems to be quite wrong. Indeed, the noble Baroness assumed that that equation existed without stopping to discuss whether it should exist. But the word "reasonable" does not always mean reasonable in the very limited Wednesbury sense. In fact, if one looks at subsection (5) of Clause 7, one finds the phrase "As soon as is reasonably practicable". Quite clearly, the word "reasonably" in that context does not mean reasonably in the Wednesbury context. It would be a very limited meaning if that were so. It means what the word ordinarily means. It must be not merely practical, but reasonably practical.
Here in Clause 6, what these amendments are seeking to do is this. It is being said: "Here is a clause which quite unusually, quite exceptionally, is purporting to give to the Secretary of State very wide powers to validate what he may have done in the past, which it is conceded may have been unlawful, and within the terms of the clause, though unlawful, those actions shall be deemed to have been lawful and to have been done in compliance with the provisions of the Bill." It does not seem to me to be unreasonable, using the word in its widest sense, that that special privilege which is being given to him, exceptionally, by this legislation should be defined by reference to actions which were reasonable in the broad sense of
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the term and not in the very narrow Wednesbury sense.
I do not know the reasons why local authorities have not challenged decisions of the Secretary of State previously and have allowed the time to elapse to which the noble Baroness referred. But, inasmuch as they could not have challenged them except within the terms of the Wednesbury decision, they would have had to put forward the contention that no reasonable Secretary of State could possibly have made those decisions, which they may well have felt was far too strong a burden to undertake. It is very understandable, and on many occasions it is an argument which in another capacity I have been able to use when attacks have been made upon decisions of Secretaries of State.
Where one is dealing, as now, with a much wider meaning of the ordinary word "reasonable" and is not tied down to the Wednesbury definition of it, one cannot say whether if that had been available to those local authorities they would have had grounds for bringing proceedings within the period that the noble Baroness has mentioned. Therefore, the whole opposition founded on the Wednesbury decison falls and a better ground needs to be found before opposition to the amendments is justified.
The case for the amendments is as I have already stated. It is obvious that the constitutional importance of the exemptions and the forgiveness which Parliament is now being asked to give to the Secretary of State is so great that it should be given only if he has acted reasonably in the widest possible sense of that term. It is that argument which the Minister needs to meet rather than an argument founded on the narrow definition of "reasonable" in the Wednesbury case.
Baroness Hooper: I start by saying that I believe there is no hybridity risk in this clause since all authorities are treated in exactly the same way. Nor does the clause in any way give the Secretary of State carte blanche authority to do whatever he wants to do. This clause covers only past decisions.
I pointed out that we felt the amendments were not necessary and I also said in answer to the point raised by the noble Lord, Lord Dean, that individual cases were not finalised on the grounds of unreasonableness. I therefore feel that his analogy does not apply.
In referring to the general provisions of administrative law and the Wednesbury decision, I should not disagree with the interpretation of the noble and learned Lord, Lord Silkin. It is my understanding that the general administrative law principles which require the Secretary of State to act reasonably in the Wednesbury sense refer to decisions which are outrageous, which are reached without taking account of relevant factors or indeed which are reached after taking into account irrelevant factors. I agree that that is perhaps a narrower definition than that which noble Lords seek to achieve by their amendment. Nevertheless, we feel that there is always some difficulty in interpreting what is reasonable and what is

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unreasonable. For example, perhaps the noble and learned Lord could explain what he means in Amendment No. 13 by "reasonably estimated".
Having said that, I return to the original premise, which is that what we want to achieve with the clause is certainy for local authorities. We do not believe that that would be achieved if the amendments were allowed.
Lord Silkin of Dulwich: Since I am invited to construe Amendment No. 13, I should have thought that it is reasonably simple. I might possibly have altered the wording slightly in that instead of reading,
"provided that any such total shall have been reasonably estimated".
it would have read,
"provided any such total shall be a reasonable estimate".
Lord Dean of Beswick: I am grateful to the Minister for the way in which she replied to the point that I made. However, perhaps she misunderstood what I meant by carte blanche I was not referring to the Bill as a whole; I was referring to the fact that in the case of retrospection the Bill gives the Secretary of State total control without any recourse, because the right to go to a court is taken away. If it is possible to have recourse to a court, I should be pleased to hear it.
Baroness Hooper: I think that the noble Lord is in error in his understanding of this point. The effect of the clause is to cover only past decisions made by the Secretary of State, which, as I have said, have already been laid as orders or in some other way, so that there is no future effect as a result of the clause.
Lord Dean of Beswick: That means that the Secretary of State can deal with such matters as he wishes. The decision is unchallengeable; that is the point I am making. It is a retrospective carte blanche. It must be.
Baroness Hooper: It is not as the Secretary of State wishes; it is as he has done already, and I think that should leave no one in any doubt.
Lord Underhill: If I may raise a small point, I believe that the noble Baroness referred to something which had already been done. However, I believe she also said that a local authority could not take advantage of the position because it would be out of time. If that is so, why is there anything at all in subsection (2) relating to the year beginning 1985 and the year beginning 1986, when according to the Minister no action can now be taken by local authorities irrespective of the Act?
Baroness Hooper: I was referring to general principles of administrative law, which under normal
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circumstances require that challenges should be brought promptly or at any rate within three months, except in exceptional circumstances. The general point is covered by that principle and I believe that the reference made in subsection (2) is again a reference to past decisions. Once again, it is not a matter which is liable to arise in the future.
Lord Underhill: I bow to legal opinion on this. However, if such a matter is not likely to arise or connot arise in the future, why do we have subsection (2) at all?
Baroness Hooper: The noble Lord has me slightly on this. However, it is my understanding that although the decisions all relate to occurences in past years, in the complicated methods of referring to some of those decisions and their effects, the reference to "intermediate year" is necessary in the subsection in order to make it clear that it relates to past decisions. I think elsewhere in the Bill will be found—although I am not absolutely sure where at the moment—a definition of "intermediate year". Courts do give leave in exceptional circumstances. Therefore, it is intended to cover exceptional cases and possibly cases in the pipeline.
Lord Underhill: Therefore, does the noble Baroness agree that if a court allowed a case to be heard in exceptional circumstances, that part of the amendment specifying that the Secretary of State should have acted reasonably could take effect and therefore the amendments would be in order?
Baroness Hooper: The point which I tried to make earlier is that the amendment is not necessary. The circumstances in which the general rules of administrative law apply on the grounds of unreasonableness will apply in any event.
Baroness David: We have had quite an interesting discussion on the amendment. We shall have to read the debate with great care. It seems to me that we were wise to bring these amendments forward. They may well be necessary. However, in fairness to the noble Baroness, we must read Hansard carefully and decide what to do at the next stage. She has not yet convinced me that the amendments are unnecessary. We shall look with great care at Hansard and I should not be at all surprised if we returned with the same amendments at Report stage. However, at this moment I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Earl Cathcart): In calling Amendment No. 14, I should advise the Committee that, if it is agreed, I cannot call Amendment No. 15.
[Amendments Nos. 14 to 20 not moved.]
8.30 p.m.
Baroness David Baroness David moved Amendment No. 21:
Page 6, line 15, at end insert ("except where such a decision is given in respect of litigation before the courts on or before 18th December 1986.").
The noble Baroness said: This amendment has to do with Greenwich. Its purpose is to remove immunity against the case brought by Greenwich. It is to allow the Greenwich case against the Secretary of State to proceed further. Greenwich had taken the Secretary of State to court over two issues and had appeared in court at first instance before 18th December, which was the date of the publication of this Bill. The Government conceded on the first limb of the Greenwich case but not on the grounds that the borough was correct on the point taken. They conceded because they argued that, knowing as they did that all their calculations of total and relevant expenditure were illegal, they could not defend the case.
I think it is important from the point of view of this amendment to give a little history of the Greenwich case and to say what was really happening in the courts. The Greenwich challenge sought, first, to quash the Rate Limitation (Prescribed Maximum) (Rates) Order 1986 as it related to Greenwich. This is the 1986–87 rate-capping order. This limb of the challenge has succeeded. The Secretary of State consented to judgment in favour of Greenwich, and a consent order was made by the High Court on 17th December, 1986, which, as noble Lords will be well aware, was the day before this Bill was read a first time in another place. Clause 6 of the Bill seeks to reratecap Greenwich in 1986–87 and to reverse the High Court decision; and of course it goes much wider than that.
Secondly, Greenwich sought to prohibit the Secretary of State from redetermining multipliers determined for the London boroughs in the Rate Support Grant Report (England) 1986–87 as proposed by the DoE consultation paper Local Government Finance (Grants) 1986 No. 50. This limb of the challenge was heard on 29th and 30th January 1987 and 2nd February 1987. The proposals have now been embodied in the 1986–87 First Supplementary Report announced to another place on 13th January 1987. The Secretary of State is anticipating the outcome of the proceedings, and this I shall explain.
The "redetermination of multipliers" sounds complicated and it is. In simple terms, the Secretary of State received a complaint from Bromley that it did not get an adequate allowance in RSG terms for taking over additional highways on the abolition of the GLC. The Secretary of State agreed and proposed to give Bromley more grant. He also adjusted the grant of authorities charged with running Hainault Forest. He decided to find this money by penalising other authorities, and inner London boroughs in particular. Greenwich is the largest potential loser, with an envisaged loss of £3.822 million of grant in 1986–87 entitlement. Tower Hamlets and Lewisham will also lose more than £1 million.
Greenwich objected that the Secretary of State had no power to do this, and this he now acknowledges. But he has taken powers in the Rate Support Grants Act 1986 which he considers give him that power. The Act received Royal Assent on 31st October. Although Mr. Ridley says himself that he is the only person who is certain what the law is, Greenwich still maintains that he does not and that he still has no power to redetermine multipliers and to penalise Greenwich as proposed. What I shall say will describe the position in a little more detail.
The stated intention of the 1986–87 RSG report was to avoid losses or gains to ratepayers as a result of the abolition of the GLC. That was in paragraphs 20 and 21 and Annex G. This was to be achieved by determining multipliers to adjust the RSG entitlement of successor authorities. As a preliminary it was necessary to make an expenditure assumption to reflect the transfer of functions from the GLC to successor authorities. In other words, the Secretary of State had to divide the GLC budget between successor authorities. If noble Lords want to look that up, they will find it in paragraphs 6, 7 and 8 of Annex G to the report.
This division/allocation of the GLC budget was notified to Greenwich and to other successors by a DoE letter of 20th December 1985 which purported to give the final allocations of the GLC budget. Multipliers were determined in the RSG report using this allocation. That is in paragraphs 15 to 17 of Annex G. The allocation to Greenwich was £22.779 million. Greenwich is having to spend £24 million on ex-GLC services and estimates that expenditure of not less than £26 million is required. But it does not have the resources to spend at this level. The Secretary of State is now proposing to change his final allocation and to reduce this to £20.513 million, or thereabouts—it is very difficult to get accurate information from the DoE. Thus the original inadequate allocation of £22.779 million will be reduced.
As the original allocation was inadequate it meant that as a result of GLC abolition there were losses for Greenwich ratepayers, contrary to the stated intention of the Secretary of State. The Secretary of State now proposes to increase those losses. The effect of his proposals is to withdraw £3.822 million of Greenwich's 1986–87 block grant entitlement. Greenwich ratepayers would have to find a further £3.822 million over and above the losses which they have already suffered as a result of GLC abolition.
Grant taken away from Greenwich and other inner London boroughs is being given to Bromley, Barnet, Sutton and outer London boroughs. The outcome is even more serious, as it relates to the base position following GLC abolition and will affect grant entitlement in 1986–87 and future years as well. There is a lot to play for. Following the protest by Bromley, the Parliamentary Under-Secretary of State, Mrs. Angela Rumbold, announced on 31st January 1986 at col. 1256 of the Official Report that a mistake had been made in the allocation of the GLC budget for

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highway maintenance to successor authorities. It is to be noted that this is but one element of the GLC budget. The Secretary of State is not proposing to correct errors which disadvantaged Greenwich such as his misallocation of land drainage expenditure. Greenwich was allocated only £138,000, yet actual expenditure, which is in the form of a levy to the Thames Water Authority, over which Greenwich had no control, is £769,000.
On 6th March 1986 the Minister of State for the Environment, Countryside and Local Government, Mr. William Waldegrave, announced how the Secretary of State would deal with his error. The intention was to redetermine the multipliers determined for London boroughs in accordance with Annex G to the draft supplementary report. There is to be a temporary safety net to limit grant losses to the equivalent of a 2p rate, but only as a temporary arrangement to be removed in a subsequent supplementary report.
Greenwich objected that the Secretary of State was proposing to act in an unlawful manner. This he now acknowledges, but he claims to have taken powers—paragraph 10 to Schedule 1 of the Rate Support Grants Act 1986—to act as he proposes by amending Part VI of the 1980 Act, the Act at issue in Clause 4 of this Bill. Thus the Secretary of State was forced not to proceed with his March proposals but introduced new proposals to the same effect in the DoE paper referred to earlier. He proposes to implement the proposals using the new powers which we believe are available to him after the Rate Support Grants Act received Royal Assent at the end of the last Session.
However, Greenwich strenuously maintains that the Secretary of State still has no powers to implement the proposals now incorporated into the proposed First Supplementary Grant Report for 1986–87 announced on 13th January 1987. Judgment in the case is expected this Thursday. I shall return at the end of my speech to a number of questions that I should like to put to the Minister arising from a possible decision in Greenwich's favour.
I now refer to the rate cap challenge. This was successfully concluded on 17th December and it is not necessary to give full details. But included in the grounds of challenge were, first, that the Secretary of State took into account his unlawful proposal to reduce Greenwich's block grant entitlement; and, secondly, that it was bad enough taking into account the proposal at all as the Secretary of State failed to disclose this to Greenwich prior to proposing a maximum rate to Parliament. But this conduct was all the more serious as the proposal was unlawful, as the Secretary of State now acknowledges. Thus on 30th January 1986 Greenwich had a meeting with Mr. Waldegrave and asked for a higher rate limit, enabling it to incur expenditure above the redetermined expenditure level of £95.228 million.
The DoE know at that meeting that it was proposing to reduce Greenwich's block grant entitlement, and
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hence the level of £95.228 million at which it could incur expenditure without recourse to reserves, but concealed that from Greenwich. On the following day, 31st January, an announcement was made to Parliament but no details as to how this affected individual authorities were given.
In the course of February the DoE produced proposals which did contain details of the effect on individual authorities but it did not disclose these to Parliament or to Greenwich prior to inviting Parliament to approve the draft Rate Limitation Order. The draft order was laid before the House of Commons on 13th February and approved on 25th February 1986. On 26th February the Secretary of State made the order.
It was not until 6th March that Parliament and affected authorities were told of the proposals which undermined the basis on which the order had been approved by Parliament and made by the Secretary of State. Thus Greenwich was denied the opportunity to make representations as to this crucial element of the rate-capping calculation. It follows that the Secretary of State conducted consultations and statutory negotiations under the Rates Act 1984 on one basis, whereas the Secretary of State reached a final decision on a different basis, taking into account an uncommunicated decision—to reduce Greenwich's RSG entitlement. Greenwich accordingly contended that the Secretary of State acted in an unlawful and procedurally improper manner and to its prejudice.
In the event, the Secretary of State avoided a detailed examination of his conduct by submitting to judgment on the tangential point of the definitions of relevant and total expenditure. As it was only necessary to win on one point, the other issues were not ventilated in the High court. The Greenwich case is now poised at a very interesting stage. As I said, judgment will be given this Thursday on the RSG aspects of the case.
The Government's QC stated that the Bill would not affect the outcome in respect of the RSG aspect on the basis that the Bill validates past decisions and that the decision on multipliers is still to be taken. The proposal to recalculate multipliers, however, first appeared in March. It was withdrawn but then reappeared in the consultation paper. It is incorporated in the Rate Support Grants Act 1986, which amends the 1980 Act to give the Secretary of State the necessary powers—at least in the Government's view—and it now appears in the supplementary report which is awaiting the passage of the Bill before it proceeds. It is difficult to see how all these steps are divorced from a final decision.
The Minister should state tonight the position on the following points. First, will the Government confirm that, although they conceded the case on rate-capping because of the definitions, this Bill will validate the 1986–87 rate cap anyway and without an opportunity for Greenwich to re-mount a challenge on the main issue? Secondly, if Greenwich wins the RSG limb of the case on Thursday, the Bill will affect none of the past proposals, Acts and so on on this issue?
Thirdly, will the 1986–87 supplementary report be withdrawn as a consequence, and what will be the time-scale for all authorities' RSG adjustments for that year? Fourthly, in relation to the second question, if it affects none of the past Acts on this issue, how does this square with the words "Anything done" in Clauses 4(1) and 6(2)?
Finally, in a letter to Margaret Hodge dated 20th March 1986 the Secretary of State gave an assurance that in later years—that is, 1987–88 onwards—he would consider the implications of changes in grant entitlement resulting from the removal of the temporary safety net when calculating rate limits for those years. It is worth noting that in this Bill the Secretary of State has prevented himself from honouring this assurance by the terms of this clause and Clause 7, which prevents consideration of the position of individual authorities prior to setting a rate limit.
I am sorry to have gone on for so long but it seems to me that Greenwich has had a hard time. It is important that the situation should be thoroughly understood. I hope that the Minister will be able to respond to this long explanation of Greenwich's situation. I beg to move.
8.45 p.m.
Lord Skelmersdale: I shall try, but whether I succeed only the noble Baroness and perhaps her colleagues on the Front Bench opposite will be able to tell. I think it would be best for me to go back to the Bill before referring to the terms of this amendment and to look at Clause 6. This may or may not save time on the Clause 6 stand part debate which I anticipate we shall have fairly shortly.
The important part is subsection (3), which states:
"For the purposes of section 7 below and Schedule 2 to this Act—

(a) any designation of an authority under section 2 of the 1984 Act in relation to the financial year beginning in 1987, and

(b) any determination and notification under section 3(1) and (3) for that Act of a level for an authority's total expenditure in that year,

shall, if made before the passing of this Act, be deemed to have been made in compliance with the provisions of Part I of the 1984 Act"—
that is, the Rates Act. What is germane to this particular subsection is that when the axe fell, as it were, my right honourable friend had taken only two decisions for next year; namely, he had selected who should be rate-capped and he had made a decision on their limits. He had not yet decided on anything else and so, by definition, must fall outwith the scope of this Bill.
This amendment seems to be a further attempt to modify the validation provisions we are seeking for past actions on rate limitation, so that in the case of at least some of these matters there still remains scope for effective judicial review, and the things done which are the subject of the amendment relate to matters which were the subject of litigation which was before the courts on or before 18th December 1986—the day on which the Bill was introduced into another place.
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I accept that what we are proposing will cut across the normal judicial review process in a few cases. However, we are talking not of a plethora of cases but of only a few. There are only three cases which fall within the category of the amendment: two brought by the London Borough of Greenwich and the South Yorkshire Passenger Transport Authority related to rate limitation for 1986–87 and one brought by the London Borough of Islington was a challenge to their designation for 1987–88. Because total expenditure runs throughout the rate limitation system, we have conceded on total expenditure grounds alone.
As I understand the law—and I am sure the noble and learned Lord, Lord Silken, will correct me if I am wrong—that means that even though that was the limb of the case on which the Government conceded, the whole case is conceded with it. As my noble friend Lady Hooper has just said in answer to the last amendment, two of the cases—Greenwich and Islington—have already been conceded and we are conceding the third. The court has therefore already made a decision in two of these three cases, and the effect of the amendment is that Islington's designation for 1987–88, Greenwich's rate limit for 1986–87 and South Yorkshire Passenger Transport Authority's precept limit for 1986–87 would not be validated. It is quite clear that the Bill therefore needs to validate these decisions.
The noble Baroness spoke at great length about the Greenwich multiplier case which I can tell her is about a future decision which the Bill does not validate at all. The case is wholly outside the validation provisions of the Bill and will be decided in the usual way. I, like her, understand that judgment is likely to be given on Thursday of this week. The future decision will be taken in the first supplementary report for 1986–87. This has not been taken, which is why it cannot be validated by this particular Bill. It will be taken, however, after Royal Assent.
I do not see therefore how arguing the merits of the Greenwich case relates either to the Bill or indeed to the amendment. Even if it did on the Greenwich multiplier case, my right honourable friend cannot take any further decisions until after the Bill is enacted. They will still be for review in the courts, if Greenwich still wants them, in exactly the same way as has happened up to now.
In answer to the quick-fire questions of the noble Baroness, Lady David, at the end of her speech, while my introduction covered two of the points, I can tell her that the Bill validates the 1986–87 rate cap and all past rate support grant decisions. So far as concerns the other questions, if I have not answered them, I shall clearly have to write to the noble Baroness because otherwise we shall get this matter referred to time and again in our future discussions on the Bill which I for one should like to avoid. That is all I can say in answer to this particular amendment and I trust it has been helpful enough to the noble Baroness to allow her to withdraw this particular amendment.
Lord Silkin of Dulwich: Would the Minister be good enough to repeat (perhaps a little more slowly than he

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did when making his speech) the part of his remarks in which he apparently was seeking my agreement? Why that should help him, I am not sure; but evidently he thought a great deal of that fortification of his argument. Before I fortify it I should like to know what it is I am fortifying.
Lord Skelmersdale: I shall try and repeat what noble Lords will find in Hansard tomorrow because it is not something that I had written down before I said it. What I said was that as I understood the legal position, when a government concedes a case in administrative law, the whole case falls. The bit which was not conceded has no direct judgment on it. Obviously, the case is given away in that respect as it is in the concession respect. That is what I was seeking confirmation for. The noble and learned Lord may or may not tell me I am right, but that is what I sought to say.
Lord Silkin of Dulwich: I am grateful to the Minister. Whether he is right or wrong really depends on what exactly he means. I am still not very clear about that. Perhaps I can put it in my language. If proceedings are brought seeking, as in this case they would be, the annulment of a decision and the plaintiff—in this case a local authority—relies on four grounds, it is sufficient for him to succeed on one. The fact that he has succeeded on one does not mean that he has either succeeded or failed on the other three.
Lord Skelmersdale: Without taking it in particularly rapidly at this time of night, I understood that what the noble and learned Lord has just said is confirmation of what I said earlier. However, we shall no doubt both look at Hansard in due course and decide whether I am being erroneous or not, since that seems to be the going word of the afternoon!
I am not convinced that whatever happens we should simply accept the decisions of the court. We could not possibly agree to this. This is the decision on the cases which started as a result of the procedure before the Bill. It is essential that, notwithstanding the total expenditure problem, we maintain the discipline of rate limitation. The need for this discipline is all too clear as is illustrated by the Audit Commission's Report on certain London authorities. It would be irresponsible of us if we allowed the technical problems on total expenditure to leave ratepayers unprotected, even for one year, from the burdens which high spending councils might otherwise impose on them.
That is a sentiment that I shall express in rather longer and wider terms tomorrow when we actually get down to the nitty gritty of the various formulae that are proposed in the Bill. In the meantime, I hope that the noble Baroness, and indeed the noble and learned Lord, will feel that even if I have not been helpful I have at least tried to be helpful in respect of this amendment.
Baroness David: The Minister has made a good effort because I made a long speech and I asked a lot of questions. He has answered some but not all of
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them. I hope that he will do what he said he would, which is to read Hansard in the morning, and if possible to get fairly quick answers. It would be helpful if some communication could come before we get down to what he calls the nitty gritty tomorrow afternoon, even though I cannot bring this particular amendment up again until Report stage. If he can give any sort of communication to us before we start on the second Committee day tomorrow, that will be extremely helpful. With that said, I am prepared for the moment to withdraw the amendment, but I think the Minister wants to say something else.
Lord Skelmersdale: Time being what it is, it may not be possible to send to the noble Baroness a written missive; it might have to be an oral one. However, I shall certainly do my best so that she is well armed to attack me tomorrow.
Amendment, by leave, withdrawn.
[Amendment No. 22 not moved.]
On Question, Whether Clause 6 shall stand part of the Bill?
Lord Silkin of Dulwich: I do not intend at this hour to take up much of the time of the Committee on clause stand part. I rise to draw attention to the fact that, although a number of amendments have not been moved on Clause 6 because of the narrow defeat on the major amendment of Clause 4, that is not to say that those amendments are considered to be wrong.
No doubt in due course we shall want to come back to those matters, so far as we are able to do so, in order to make quite sure that the whole basis of validation, which is the fundamentally important part of this Bill, is in the most appropriate language, as the noble and learned Lord, Lord Denning, said in the course of his earlier speech. That applies of course to both Clause 4 and Clause 6.
9 p.m.
Lord Skelmersdale: Perhaps I may quickly say that, as the noble and learned Lord, Lord Silkin, has just said, Clause 6 validates past Acts in relation to rate limitation. When considering the amendments that we have debated at length this afternoon, the nature of the validation provisions that we are seeking in this clause was fully and extensively discussed, and indeed, as the noble and learned Lord has just said, voted upon. As I explained then, and have continued to explain throughout the afternoon, our principal concern is to provide absolute certainty about precisely what is validated so that there can be no argument that something done in the past is not valid.
Of course I understand the concern of a number of noble Lords about the scope of the validation provisions that we are seeking and about the fact that these provisions put past decisions—and I must emphasise past decisions again as I did on the last amendment—effectively outside the scope of judicial review. However, noble Lords opposite have not suggested any satisfactory alternative. As I have explained, the amendments that have been put forward simply will not work. They either will result in nothing being validated or will lead to great uncertainty about what is validated.

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We have not embarked lightly on the course that we have chosen, as I have said. We have carefully considered the nature of the validation provisions that are necessary to deal with the problem on relevant and total expenditure and I have listened carefully to the arguments that have been put forward today. I remain convinced that there is no alternative to the provisions that we are seeking in Clause 6. I believe that they are both right and necessary. However, I have said, and I say again to the noble Baroness, that I shall study Hansard with the greatest care and—to use an expression on which I think the noble and learned Lord, Lord Silkin, pulled me up a little time ago—I shall crawl over it personally and I shall answer in the light of that crawling. I hope that this clause may stand part of the Bill.
Baroness David: I am grateful for the noble Lord's remarks. From what he has said I believe that he has been impressed by the very powerful opposition that there has been to certain parts of Clauses 4 and 6 of this Bill. There was very distinguished opposition when my noble and learned friend Lord Silkin moved his Amendment No. 3, and I am very glad that the noble Lord is taking that into account. There are a great many people who are very unhappy about many parts of this Bill. Having had so many mistakes about
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legislation in the past, it will be another very big mistake if this measure gets on to the statute book with so much uncertainty as to the meaning and the breadth of so many of the clauses in the Bill. I am very glad that he is taking that sensible attitude to it.
Lord Skelmersdale: If there is any uncertainty under the Bill there will certainly be even more uncertainty as to what is and is not validated so far as concerns the amendments that have been put down on the Marshalled List today. I have said that I and the Government want certainty, and the noble Baroness has agreed with me about that. Perhaps with a bit of luck we shall actually achieve it.
Clause 6 agreed to.
Baroness Hooper: It may be for the convenience of the Committee if we break our deliberations now. I therefore beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at five minutes past nine o'clock.

  METROPOLITAN POLICE: SUPERVISORY AUTHORITY
  METROPOLITAN POLICE: SUPERVISORY AUTHORITY
  PUBLIC ORDER ACT 1986: IMPLEMENTATION
  PUBLIC ORDER ACT 1986: IMPLEMENTATION
  OFFSHORE PLATFORM REMOVAL: REPORT
  OFFSHORE PLATFORM REMOVAL: REPORT
  OFFSHORE INSTALLATIONS: INTERNATIONAL LAW ON REMOVAL
  OFFSHORE INSTALLATIONS: INTERNATIONAL LAW ON REMOVAL
  SDI: DEPARTMENTAL RESPONSIBILITY
  SDI: DEPARTMENTAL RESPONSIBILITY
  UNIT WAGE COST COMPARISON
  UNIT WAGE COST COMPARISON
  OIL SPILL DETECTION SYSTEMS
  OIL SPILL DETECTION SYSTEMS